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Anyone interested in a cleanup in Pulaski County?

The county has $815,000 in funds sitting around from the federal environmental program that helped developers revitalize downtown Little Rock's Main Street.

Since receiving the money last year, no one has applied to use it, said Josh Fout, the county's brownfields administrator.

The U.S. Environmental Protection Agency Brownfields Revolving Loan Fund distributes money to government agencies for the assessment or cleanup of properties that are complicated to develop because of the presence or potential presence of a hazardous substance, according to the EPA.

In the mid-2000s, more than $1 million in brownfields program money helped clean up several Main Street buildings, which allowed developers to build Main Street Lofts and K Lofts, major staples of the new Main Street.

Last year, the EPA announced $55.2 million in brownfields grants to 131 communities, with Pulaski County receiving the highest funding award of $820,000. Since then, the county has spent only $5,000 of that money on administrative costs for its brownfields program.

The EPA awarded the Western Arkansas Planning and Development District $400,000 at the same time as Pulaski County last summer. Those funds were to be used for assessments of properties for potential cleanups.

Community Development Director Tracee McKenna said the district has performed assessments at two buildings in downtown Fort Smith for possible use of the funding and plans to go out to sites in Ozark, Mulberry and Booneville.

When Pulaski County wrote for the brownfields grant, Fout said, officials had a few neighborhoods in mind that might be interested in using it.

But development has slowed in Arkansas because of changes to the state's historic tax credit laws, said Scott Reed, managing director of Portland, Ore., based Reed Realty Advisors. Reed's group developed Main Street Lofts, which it sold this year, and used brownfields funding to clean up the Hall and Davidson buildings on Capitol Avenue, which it also sold this year.

"It's a good program," Reed said. "It helps get a lot of buildings back in play."

Reed said he expects development in Arkansas to ramp up again soon, now that developers have had time to adjust to the tax credit changes.

"You should see the brownfields program get into swing again because of that tax credit," he said.

Projects are now limited to a single tax credit of $125,000 per eligible property in a two-year period, after previously being allowed to take multiple credits for one property.

The idling of the brownfields funds isn't unique to Arkansas.

Last month, the EPA office of inspector general reported that about $10.9 million in brownfields funds were not being spent as intended.

In 10 of the 20 government agencies that received brownfields money reviewed by the inspector general, contaminated properties are not being cleaned up and redeveloped. In those locations, which didn't include Arkansas, government agencies cited poor market conditions, no identified projects and the use of previous brownfields money as reasons they had not spent their money.

The EPA agreed to an inspector general recommendation that future brownfields grants have deadlines for spending the money or returning it to the EPA. In many of those cases, the agencies had not spent money received as far back as 2010.

The EPA announced Pulaski County's funding in May 2016. Shortly thereafter, Fout said he visited events in various Little Rock neighborhoods, including the East Village area and the 12th Street corridor, and heard interest from people he spoke with.

About a year has passed, Fout said, and no one has applied to use the money. So Fout said he's planning a brownfields workshop to reach out further.

To be eligible for a brownfields grant or loan, a property owner must have conducted an environmental assessment of his property before taking ownership of it. Additionally, single-family homes are not eligible.

Outside of downtown Little Rock development, brownfields funds have cleaned up the former Smarthouse Way industrial property -- yet to be developed further -- in Argenta in North Little Rock and the site on which Our House built its Children's Center just off Roosevelt Road in Little Rock.

Fout said feedback has been positive when he's talked about the brownfields program with people, but acknowledged that giving the money out can be complicated by timing issues.

"It is a very useful tool to get projects redeveloped," he said, "but it's one of those things where the developer has to be interested in it."

Metro on 09/10/2017

CORRECTION: An earlier version of this story online listed the wrong location in the headline. Pulaski County said no one has applied to use money from a federal environment program.

Print Headline: Funds for LR-area cleanups sitting idle

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