We reported two weeks ago that the bill to extend the brownfield cleanup program (BCP) that had been passed back in June had finally been sent to the governor. The BCP tax credits are scheduled to expire at the end of 2015 and the legislation would have extended the tax credits to March 31, 2017 to give the Governor and Legislature time to reach agreement on a reform proposal. More information about the history of the BCP negotiations is available here.
The governor had until December 29th to sign or veto the bill. Since the bill would have died if not signed by the end of the year, the conventional wisdom was that the governor would sign the bill. However, war gaming this governor is a fool’s errand. Late in the evening of December 29th, he vetoed the bill The memo explaining the veto is available here.
The governor will be introducing another set of BCP reforms with his legislative proposals in January. Early indications were that the proposal would be structually similar to his 2014 proposal that called for a so-called two-gate approach for the tax credits with some changes on the margins. However, the NYSBA brownfield task (which I co-chair with David Freeman) assembled a group of stakeholders during the fall and this group reached a consensus on framework that would preserve the tangible tax credits as-of-right concept for all applicants. To address the concerns over the costs of the program and to better target the tax credits, the framework calls for lowering the $35MM cap but then providing bump ups for certain types of projects.
The NYSBA Brownfield Task Force prepared a report that memorialized the key elements of this framework into a report that was approved by the NYSBA Environmental Law Section. The NYSBA then sent the report to the Governor and legislature before the holidays. A copy of the report is available here. Hopefully, the Governor will consider these recommendations as he finalizes his BCP reform bill.