Title blight: is our public policy for contaminated sites creating barriers to remediation?

Title blight: is our public policy for contaminated sites creating barriers to remediation?

Since the 1970s, legislation and regulations have been progressively developed and more stringently implemented in Australia to protect human health and the environment from the adverse effects of land and water contamination. Little research on the consequences of these actions and the extent of the impact on remediation efforts exists in Australia.

An adage among property developers is ‘don’t buy trouble’. Since the introduction of public policy measures through legislation and regulation to manage site contamination in Australia, developers seem to view parcels of land that require remediation as trouble. That is, they present a number of hurdles, or barriers, to redevelopment, and are perceived as being afflicted with ‘title blight’ and the attendant reduced value. Many of these barriers have their genesis in the requirements for compliance with, and obligations under, legislation and regulation for managing contaminated sites.

Projected population growth over the next 20 years and the subsequent need for residential housing in Australian capital cities are creating pressure for redevelopment of previously industrial (contaminated) urban sites. Remediation and redevelopment of these sites is considered essential to the sustainable management and allocation of land resources for competing residential, commercial and industrial uses. Currently, there appears to be widespread reluctance by developers to remediate and redevelop contaminated sites that are not, prima facie, profitable.

Do we need government intervention or other measures?

CRC CARE has provided a PhD scholarship to research whether the effects of current Australian environmental public policy for managing contaminated sites has contributed to title blight, and to what extent these effects have created barriers to remediation and redevelopment of sites. This research also aims to determine whether options for mitigation of public policy effects of title blight, including government intervention, are required and justified. Unremediated sites are noted internationally, with some jurisdictions introducing incentives schemes, tax concessions and funding schemes to promote remediation and redevelopment of idle sites.

The literature on barriers to contaminated site redevelopment focuses on:

  • fears over future liability, and the legal and litigation costs associated with any disputes with other legally liable parties
  • lender reluctance and the difficulty of obtaining finance
  • economic uncertainty – the ratio of investment to clean-up and compliance costs
  • public perceptions.

There is also a paucity of research, particularly in Australia, that explores the development of incentives schemes as a means to address the effects of specific aspects of public policy designed to protect human health and the environment from site contamination.

Surveys have been developed to gain insight from environmental consultants and auditors, owners of contaminated sites and developers, and real estate agents.

Your help in completing and submitting the survey between now and October 2017 is needed for this important research. Survey links have been delivered to peak industry bodies such as ACLCA and ALGA.

Published September 2017 Issue 18