Environmental Cleanup Incentives as Place-Based Redistribution: Evidence from the EPA’s Brownfields Program
Grant Type
Early Career Research Award
Publication Date
3-30-2026
Description
Previously contaminated industrial sites, commonly known as brownfields, have long constrained job creation by discouraging private investment, limiting access to credit, and fostering uncertainty about environmental liability. These frictions disproportionately affect economically distressed regions, where industrial decline and weak labor demand have left many sites abandoned or underutilized. The U.S. EPA estimates that 450,000 brownfields spanning 15 million acres exist nationwide. This study investigates how the Inflation Reduction Act (IRA) of 2022 reshaped local employment and business formation through its expansion of incentives for brownfield cleanup and redevelopment. By expanding cleanup grants and adding enhanced clean energy tax credits, the IRA created a policy setting in which environmental remediation may function as a catalyst for sustained employment growth rather than as a purely environmental intervention. We test this hypothesis using administrative data from the EPA merged with finely geocoded commercial credit bureau and housing transactions data. We overcome the endogeneity of site selection inherent in place-based policies by exploiting time-varying cutoffs for cleanup grant awards via regression discontinuity designs.