HUD Policy Change to Stimulate Multifamily Development on Brownfields Sites

December 8, 2008
Client Alert Newsletter December 2009

The U.S. Department of Housing and Urban Development ("HUD") recently implemented a policy change that is expected to increase the construction of multifamily housing developments on brownfields sites. Specifically, HUD's revision to the environmental requirements in its Multifamily Accelerated Processing Guide repeals a previous prohibition on the building or redevelopment of HUD financed multifamily housing on sites with active groundwater remediation. In addition, incomplete removal of contamination through the use of engineering controls is now permissible at HUD-financed multifamily construction sites if the costs to remove such contamination are deemed excessive, if removal is impractical or if there is no known or expected risk of off-site contamination. Developers seeking to leave contaminants in place are required to submit justification for incomplete removal to HUD with a remediation plan, demonstrating that the costs of incomplete removal are sufficiently below the costs of complete removal.