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Working Paper: Measuring the Social Benefits of EPA Land Cleanup and Reuse Programs

Paper Number: 2006-03

Document Date: 09/2006

Author(s): Robin Jenkins, Elizabeth Kopits, and David Simpson

Subject Area(s): Hazardous Waste; Valuation Methods; Benefit-Cost Analysis

Keywords: hazardous waste sites; land revitalization; brownfields

Abstract: The EPA has a cornucopia of cleanup and reuse programs ranging from the Superfund Program which addresses sites posing imminent danger and many of the most hazardous sites nationwide, to the Brownfields Program which addresses lower risk sites. These programs provide a common set of primary benefits: reductions in health risks and ecosystem damages, and improvements in amenity values. Indirect benefits include changes in factor, especially land, productivity. A different indirect benefit stems from better information in land markets compared to when land is contaminated, a situation that seems marked by asymmetric information and that might depress the frequency of land transactions. Both indirect benefit categories are a result of the primary benefits and would not be added to them. Cleaning up and reusing urban contaminated sites might generate two additional types of benefits: preservation of green space, and agglomeration benefits. Limited empirical work has addressed each of these benefit categories.

Taken as a whole, the literature providing information on the social benefits of cleanup and reuse is spotty and incomplete and perhaps raises more questions than it answers. Would a comprehensive study of the benefits of all cleanup programs, or even of all aspects of one program, do better to focus on primary effects or property value changes? What is the appropriate baseline for hedonic studies? Under what conditions does reusing contaminated land deter greenfield development on the urban periphery?

This paper is part of the Environmental Economics Working Paper Series.

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