Inconvenient Truths and Unintended Consequences
by David Begelfer and George Bachrach
It’s not every day the real estate community and the environmental community share common ground. Increasingly, however, we understand a healthy economy and a healthy environment are mutually beneficial. We also understand the Commonwealth, like every other state, faces a fiscal crisis that must be met with painful budget cuts and a disciplined focus on economic development. But we must avoid cuts which undermine the very economic growth and job creation essential to our recovery.
The Commonwealth’s Department of Environmental Protection (DEP) is more than a protector of the environment. It directly affects economic development. If developers cannot get environmental permits within a reasonable timeframe, the resulting delays could kill a project – especially during this fragile economic recovery. Without timely and predictable permitting, companies looking to relocate or expand in Massachusetts may look elsewhere – taking jobs and tax revenue with them.
DEP also reviews and approves chapter 91 licenses for large, complex projects near public waterways. Many of these projects have a major economic impact and stimulate further development. For example, the newly opened Legal Sea Foods and other restaurants developing in South Boston’s Seaport district will create hundreds of new jobs and lead to further development and jobs in the city. These new projects need timely permitting, but staffing for DEP’s chapter 91 program has already been cut by more than 50% over the last three years, with more cuts to come in the FY ‘12 budget. Given the positive ripple-effect of these developments, the proposed budget cuts would be penny-wise and pound-foolish.
Economic, environmental, and public health interests inevitably intersect when it comes to cleaning up hazardous waste sites and contaminated brownfields. If DEP staff cannot expedite this critical cleanup, we will not redevelop and revitalize depressed urban centers. We will not create jobs for those who need them most, and we will put our environmental and public health at risk.
The litany of unintended consequences goes on. Without reasonable funding, DEP cannot provide the critical pre-permitting consultation that initially attracts new enterprises by facilitating complex development projects. DEP cannot provide compliance assistance to those businesses seeking to do the right thing under environmental regulations. It cannot assist municipalities with stormwater management, solid waste disposal, hazardous waste protection, wetlands protection, the mitigation of noise and odor nuisances, and the protection of safe drinking water. It will not be able to assist homeowners faced with oil spills or asbestos problems. Quite simply, DEP will be unable to do its job.
DEP’s budget has been disproportionately reduced by 40% in less than a decade, devastating a staff that has dropped from 1,200 employees in 2002 to about 745 under the proposed FY ’12 House budget passed in April. Although all of the other agencies under the Energy & Environmental Affairs Secretariat received an average 1% cut from the last fiscal budget, DEP was cut by 10%.
As the Senate develops its budget, it must consider the importance of adequately funding DEP. Under the House budget, DEP may be forced to close one or more regional offices and eliminate another 20% of its permitting staff, causing delays and stalling economic development. No growth, no jobs, no tax revenue, no environmental protection. We strongly suggest that the Senate apply the same percentage cut to DEP used for the other environmental agencies.
James Carville once famously advised then Presidential candidate Bill Clinton, "It’s the economy, stupid."
We get it. Funding for DEP is not merely about the environment. It’s about the economy. Tourism is a $14 billion industry. If we cannot protect our beaches and rivers and parks we will lose the jobs that go with it. The fishing industry is a $5 billion industry. If we cannot protect our oceans and ports, we run the risk of losing these jobs as well. And unless Massachusetts can be perceived as a national leader on both environmental protection and clean energy technology, we risk the "green" jobs that will be one of the important economic engines of the 21st century.
We recognize the need to cut government budgets. But the analysis must include unintended consequences that adversely affect our economy.
David Begelfer is the CEO of NAIOP Massachusetts, the Commercial Real Estate Development Association, and George Bachrach is the president of the Environmental League of Massachusetts.