History: The Environmental Response Fund (ERF) helps revitalize sites by providing funding to assess and clean up contamination. This helps overcome barriers that added costs of environmental cleanup pose to site improvement or redevelopment. Cleaning up these sites reduces the risk to human health and the environment.

Minnesota Statutes, sections 383B.80 and 383B.81, authorize the county to collect a mortgage registry and deed tax for the purpose of establishing an environmental response fund. The board established the ERF in 1997 (Resolution 97-06-410R1) and authorized the grant program in 2001 (Resolution 01-615).

Projects supported by ERF grants provide a variety of community benefits, including creating affordable and moderately priced housing, supporting economic development, developing green space, and making infrastructure improvements. Many ERF grants address environmental contamination in communities with significant disparities in health, including low income areas and communities of color. Some of these sites become a catalyst for new development in neighboring areas, which can help address racial disparities in housing, employment and income.

As a major economic center for 150 years, the county has a concentration of contaminated sites. Much of this contamination was caused by chemical spills or improper disposal of hazardous waste prior to the existence of environmental regulations. These improper disposal practices of the past can still cause soil and groundwater pollution that present environmental risks today.

Since 2001, the county has awarded 386 ERF grants totaling $53,967,304.

Current Request: This request is for County Administrator authorization to negotiate 9 ERF grant agreements during various periods, with the total combined amount not to exceed $1,617,299.

In June 2018, the county solicited proposals from municipalities and nonprofit and for-profit developers. In an effort to maximize collaboration between funders, the timing of the ERF grant round coincides with additional contamination cleanup grant programs administered by the Minnesota Department of Employment and Economic Development and the Metropolitan Council.

A committee reviewed the grant applications and recommend funding 10 of the 13 project applications received. Applications were evaluated on project need; degree of contamination; how the project will address contamination; creation or preservation of affordable and/or moderately priced market-rate housing; how the project supports economic development; and the readiness of the project to proceed.

The fall 2018 ERF award recommendations are summarized as follows and are described in detail in the report, Environmental Response Fund fall 2018 funding recommendations.

ERF Projects:

• Checkerboard, Minneapolis - $290,000 for abatement costs associated with the construction of an estimated 125 affordable and 125 market-rate rental units and retail space. (Grantee: City of Minneapolis)
• City of Lakes Community Land Trust Homebuyer Initiated Program, Minneapolis - $200,000 for abatement costs associated with the rehabilitation of at least nine owner-occupied, permanently affordable (land trust), single-family homes. (Grantee: City of Lakes Community Land Trust)
• Creekside at Van White, Minneapolis - $173,018 for contaminated soil cleanup associated with the construction of a new office building along Bassett Creek. (Grantee: City of Minneapolis)
• Currie Park, Minneapolis - $165,474 for contaminated soil cleanup associated with park cleanup and improvements. (Grantee: Minneapolis Park and Recreation Board)
• Gateway Northeast, Minneapolis - $260,739 for contaminated soil cleanup and abatement costs associated with the construction of a mixed-use residential apartment complex, which includes 50 market-rate and 75 affordable rental units, and retail space. (Grantee: City of Minneapolis)
• Lake Street Affordable Housing, Minneapolis - $222,236 for contaminated soil cleanup, demolition, and abatement costs associated with the construction of 111 affordable rental units and retail space. (Grantee: Lake Street Affordable Housing, LLC)
• Minnesota Brownfields Gap Financing Program, countywide - $200,000 to continue the Brownfields Gap Financing Program, which provides small environmental assessment grants to government entities and non-profit organizations.(Grantee: Minnesota Brownfields)
• Portland and Washington Mixed-Use Development, Minneapolis - $81,364 for contaminated soil cleanup and abatement costs associated with the construction of 240 market-rate and 90 affordable rental units, a fire station, and office/retail space. (Grantee: City of Minneapolis)
• Robbinsdale Apartments, Robbinsdale - $24,468 for contaminated soil cleanup associated with the construction of 197 market-rate rental units. (Grantee: City of Robbinsdale)
  This request also is for approval for grantees to incur costs after the board approval date, with reimbursements being paid upon execution of the grant agreements.

Impact/Outcome: The recommended ERF grant awards will fund asbestos and lead-based paint abatement and contaminated soil assessment and cleanup. This funding supports projects that create economic development by increasing the tax base, creating permanent jobs, enhancing green space, and creating affordable and moderately priced market-rate housing. The recommended grants provide for the renovation or construction of an estimated 452 affordable housing units. ERF grants help address environmental contamination in communities with significant racial disparities in health, and supports projects that help reduce disparities in housing, employment and income.