The Massachusetts Brownfields Tax Credit (BTC) is an incentive program that allows property owners or lessees to remediate contaminated land. Since Massachusetts requires owners or lessees of contaminated properties to remediate the land regardless of who caused the contamination, the BTC exists to lessen the financial burden for owners who did not cause the contamination but are obligated to clean the land up.
MassDEP states that the BTC program exists to foster, “the cleanup and redevelopment of brownfields properties as a way to stimulate the economy and promote environmental protection goals.”
The BTC amounts to 50% of the eligible costs of a qualified remediation when the permanent solution does not contain an Activity and Use Limitation (AUL), and the BTC amounts to 25% of the eligible costs when the site is closed with an AUL. The costs that are BTC eligible are those “direct” environmentally related costs.
The costs include:
- LSP costs
- lab testing costs
- 21E related legal expenses
- soil removal and disposal
- clean fill costs
- site preparation
- and more
The Brownfields Tax Credit is earned following the remediation of an environmentally contaminated property that has “achieved” a permanent solution or ROS.
Current Requirements to receive the BTC:
- Taxpayer cannot have caused the contamination
- Taxpayer must be the owner or lessee of the contaminated site during the cleanup period
- The site must be closed out with a permanent solution or ROS
- The money spent on the remediation must amount to at least 15% of the site’s assessed value at the time the remediation began
- The site must be in an economically distressed area
- The site must be used for business purposes
- The remediation expenses must be incurred by an entity, trust, not-for-profit corporation