APPLICATION FOR BROWNFIELD REVOLVING LOAN FUND GRANT

Bemen County Redevelopment Authority (Applicant)

Benton Harbor Brownfield Redevelopment Authority (Coalition Member)
St. Joseph Brownfield Redevelopment Authority (Coalition Member)

The Bemen County Redevelopment Authority is requesting $3 million for a Revolving Loan Fund
(RLF) Grant in coalition with its strategic partners, the Benton Harbor and St. Joseph Brownfield
Redevelopment Authorities. Pursuant to Act 381, Public Acts of Michigan, 1996 and resolutions
adopted by their respective units of government, as filed with the Michigan Department of State, all
three entities are recognized instrumentalities of their respective political subdivisions and are
therefore "eligible entities" for the purposes of this RLF Grant application. This application is made
with the formal approval and support of each governmental entity herein described, documentation
of which is provided hereto as Exhibit #l.

Prior to the submittal of this application, it is reasonably estimated that over 3,000 people
attended the numerous bus, helicopter, and boat tours, public meetings, and service club
luncheons conducted in regards to the redevelopment plans specifically described herein. The
hallmark of these efforts was the mutual respect and trust created through the community's
. visioning of a "shareddevelopmentJJstrategy, as articulated in the resolutions of support, which
serve to document the most recent public forums in which public participation and comment has
been solicited by each of the eligible entities. It should be M e r noted that a summary of this
particular RLF Grant application has been published in the Benton Spirit, The Herald Palladium,
and a full copy of this application has been provided for public comment at meetings of all three
Brownfield Redevelopment Authorities held prior to the submittal of this application. Also
noteworthy to the public meetings and community notification efforts specifically described
herein, the designated redevelopment project referred to as "Edgewater - River Run", for which
the majority of funding is being sought under this application, has long been part of the larger
"Edgewater Redevelopment Plan", a physical and social redevelopment effort that has been
recognized by the Michigan Department of Environmental Quality (MDEQ), Federal
Environmental Protection Agency (EPA) and numerous other agencies and organizations as one
of the most successful brownfield redevelopments in the Midwest. As such, it can be further
shown that the redevelopment plans embodied in this particular application have been scrutinized
in hundreds of public meetings, hearings, and planning sessions conducted over the course of the
past several years.
-- --

Letter from thcrSiiteEnvironmental Authority ~ -''I-

-- I
A letter from the MDEQ acknowledging the intent of the applicant to seek federal financial
assistance and its plans to establish a revolving loan fund and conduct cleanup activities is
attached hereto as Exhibit #2.
 1 D. Site,Eligibilityand Property Ownership Eligibility
This section is not applicable, as this proposal is for "Community-wide" RLF Grant funding.

/ E. Cleanup Authority
- and Oversight Structure
All loan and subgrant recipients shall be required to enroll in a state response program under
which compliance shall be determined by the MDEQ. Cleanup work shall be performed under
the auspices of the Berrien County Redevelopment Authority pursuant to a brownfield RLF that
shall be established and referred to hereafter as g ~ i c h i ~ a n Great
's Southwest Cleanup Fund".
On all sites under which these RLF funds are used, the Berrien County Redevelopment Authority y.
shall maintain a lien interest superior to all others in order that it may access the sites and secure
the loans and subgrants issued in the event of an emergency or default of a loan agreement or
non-performance under a subgrant, the legal authority of which is demonstrated in counsel's
opinion letter, which has been attached hereto, and described in Section G, below.
IF., Cost Share
Cornerstone Alliance, a community-based economic development organization, and Whirlpool
Corporation will collectively provide $3.3 million of funding toward the development costs
associated with the designated redevelopment area referred to herein as "Edgewater- River Run".
Included in this budget will be at least $600,000 toward the cost of eligible and allowable
environmental assessment, cleanup, and expenses requisite to the successful redevelopment of this
area, consistent with the use of the RLF Grant. =lpool has also offered to commit land it owns
along the'watdont in the City ofSt.. Joseph as an anchor for any development opportunity capable .---
of d4viqg &Ale investment
-tliFEXEiis undeve1oped;state and structural change into the City of Benton Harbogl (The value of
- - ---_-__.
-2-.-
__ .__. -- -
- -.
A - b - -is assessedby
.- - .- , the community at over $4,000,000.) s
.

In addition to these local cost share commitments, the State of Michigan, through its Clean
Michigan Initiative, has awarded $300,000 for additional site assessr@nt~workin the designated
redevelopment area within Edgewater known as -''lgg~+ter - Harbor ~ d w n ? and
, an additional
$450,000 has been awarded to the City.of St. Jose>h for environmental cleanup on Parcel 4 o,f
the Edgewater development area. The, st#e. has-ialso .committed another $125,000 for a m g ~ uj;
paraPd'
7 -,-
.
be:i~on~~cfid$ih~@e4~d"g~~a'tef5d6~e1"&$hdnt -&a. #And finally, Cornerstone ~ l l i E
and Whirlpool Corporation have further committed $600,000 toward &&elevationof.a vehri,dular 4
and -within the Edgewater - River Run redevelopment Teal

/ G. Legal Authority to Manage a Revolving Loan Fund

An opinion from legal counsel demonstrating the applicant's legal authority to perform the
actions necessary to manage a revolving loan fund is attached hereto as Exhibit #3.

RANKING CRITERIA

IA. RLF Grant Proposal Budget

The following budget represents the anticipated distribution of RLF Grant proceeds among the
subgrant and revolving loan fund segments of this application. Although eligible, programmatic
costs for activities considered integral to achieving the purpose of the grant have been explicitly
excluded. All programmatic costs will be incurred by the applicant,pand are considered an
administrati<;-and operating expense for which- Increment Financ$=venues will b s
leveraged. In this manner, all RLF Grant proceeds awarded under this application will be
applied directly to the assessment and removal of environmental impediments at brownfield
sites.

I Budget I Task 1 I Task 2 I Task 3 I Task 4 1 Task 5 I Task 6 1 Task 7 I Total 1

Task 1 - Environmental Evaluations/Assessments and Inventorying

Task 2 - Interim Response Activities
Task 3 - Baseline Environmental Assessment (BEA) Preparation
Task 4 - Due Care Plans
Task 5 - Due Care Response Activities
Task 6 - Due Care Disclosure Requirements
Task 7 - Remedial Actions Necessary Under Part 20 1 of the Natural Resources and
Environmental
Protection Act, 1994 PA 45 1, as amended (NREPA) and for Redevelopment

IB., Community Need -

A map -gutl@ng,the br0@,:.at;~~jref~ed+fh,,1~6@:II'$:;q~'".~gewater"

, c is provided it #4. *This
large tract $of ldnd has been under constant planning and redevelopment in order to create
development opportunities for Benton Harbor, St. Joseph and the surrounding area. Anchoring
redevelopment in this area will provide the demand stimulus requisite to facilitating further
b r o d e l d redevelopment throughout Berrien County as contemplated and described in subsequent
sections of this application.
Objective...
The overriding objective of this effort is to simultaneously add tax base for the distressed
community of Benton Harbor while reversing the population and job loss being experienced
throughout all of Berrien County. The work proposed within this application is considered
critical to the creation of long-term sustainable change.
Background.. .
Since beginning work on this project in 1997, the Michigan Economic Development Corporation s
(MEDC), Michigan Department of Transportation (h4DOT), Michigan Department of @
Environmental Quality W E Q ) , and Michigan Department of Natural Resources (MDNR) have all
partnerd
&
, *. w?%"*~
,a-
with the commdty in helping to bring new inkstructure and businesses into this key
"development area. &Sin& commencement of the project, new office buildings and residential t

development have become a realityh the City of St. Joseph, and hearly 1.75 million square feet of
dilapidated manufacturing buildings have been razed to facilitate remediation and redevelopment in
the City of Benton Harbor. Concurrent with these efforts, the Federal EPA has invested
approximately $7 million in the cleanup of the abandoned Aircraft Component Site located along the
Paw Paw River.
Within the Edgewater area the foundation for a redevelopment effort has been achieved, but now the
structural work of real development must occur. The redevelopment potential on which this
application is based is summarized in Exhibit #5. 4
Challenges...
The City of Benton Harbor is a unique, political, social, and economic dilemma. Located just 55
miles directly across Lake Michigan from Chicago, Benton Harbor is a city encompassing less
than four square miles and fewer than 11,500 people. The dropout rate in high school hovers at
an alarming 70% ratio. It is estimated that over 60% of the housing stock in this community is
substandard, with reasonable estimates of 30% of homes shuttered and derelict. In fact, it has
been said that no community defines the current social and economic disparity in our nation
better than that of the Benton Harbor-St. Joseph area - twin cities whose residents are as diverse
as you will find anywhere in the country. Benton Harbor is 94% Afiican American with more
than 40% of its residents living in poverty. St. Joseph is 97% Caucasian with high levels of
education and per capita achievement. The impact of Benton Harbor's strife can easily be seen
in the adjoining community land values.
In areas adjacent to Benton Harbor, planned waterfkont communities are the norm. Yet in the
immediate area, waterfiont land has not been as developed because of the negative perception of
Benton Harbor. As a result, the entire region has not benefited fiom a strong tourism base, or a
corresponding economic expansion tied to tourism. Perhaps, this is best illustrated in the median
household income for the 162,000 residents of the Benton Harbor Metropolitan Statistical Area
(MSA) being the lowest of all MSAs in Michigan.
The hardships of Benton Harbor are evident in any statistical measurement. Every single census
tract in the city has a poverty concentration of 50% or higher. According to the 2000 Census
data, the median family income in Benton Harbor is only $8,965, which is well below Berrien
County's measure of $37,095 and more dramatically below the state's median family income of
$44,221. (The city ranks last in Michigan in this category.) Alarmingly, when compared to the
core city average household income of $17,471, Benton Harbor still ranks 60% lower than the
next lowest core urban city in Michigan (i.e., Saginaw at a rate of $28,015).
Literacy is another key area dividing the residents. Based on 1990 Census data and the 1992
National Adult Literacy Survey, many adults in the region function at Level 1 or Level 2 literacy
levels. Adults at Level 1 can read a little, but they can have difficulty filling out a job
application, reading a food label, or reading a child's storybook. Adults at Level 2 usually have
about the same level reading and problem-solving skills as Level 1 adults, but can also perform
more complex tasks like comparing, contrasting or integrating pieces of information.
From a health standpoint, a 2002 Behavioral Risk Factor Study conducted by the Institute for
Public Policy and Social Research at Michigan State University showed that nearly 20% of
Berrien County residents viewed their health as fair or poor. Another 31% of residents stated
that they did not participate in any type of physical activity on a regular basis. In both
categories, women fared worse than men, and lower-income households were worse off than
more affluent ones.
Just as residents' income levels, literacy levels, and health conditions are diverse, so too are their
education levels, transportation needs, family structures and recreational interests. The Benton
Harbor School System suffers with the inability to invest in millage necessary to replace
buildings constructed in the 1950's. The combination of recycled poverty and a struggling
school system results in a drop out rate in excess of 70% for all that enter their freshman year,
further contributing to the ongoing cycle of joblessness and social decay within the community.
Benton Harbor is also a community that is squeezed with acute poverty and loss of tangible tax
base. A strong gentrification in housing and a millage rate that is the second highest in the State
of Michigan (ranging between 30%-70%, higher than all surrounding communities [2000 Census
data]) have served as disincentives for new investment. Even more alarming is the fact a recent
assessor's office review reveals no home has been sold for more than $100,000 in this city and
the average assessed value is under $50,000 per dwelling.
Benton Harbor was once the hustling economic hub of the region. Diverse commerce was the
norm. Yet rapid change occurred from 1978 to 1986 when over 5,500 high-wage, low-skilled
jobs were lost and with it, the city lost 22.3% of its population. Whirlpool Manufacturing, VM
Corporation, Benton Harbor Malleables, Superior Steel, along with the Auto Specialties
Manufacturing Company all closed their doors. With the exception of Whirlpool, each entity left
behind orphaned, industrial buildings that until recently served as a constant reminder of the
glory days, and extracted an exhaustive financial burden on the dwindling city treasury.
All of these hardships culminated in June of 2003 when the city was besieged by media
including all four major news networks, The London Times, The Los Angeles Times, Chicago
Tribune, The Wall Street Journal and CNN reporting on a three day melee involving riots in the
streets and the burning of some 29 dwellings. The paradox of the disturbance was the visible
signs of progress within the community - a community whose journey of advancement is far
from over in creating an environment where no one is left behind.
Working Together to Create Solutions ...
A city that once had the highest per capita murder rate in the nation (1993-1994) is not without a
vision for redeveloping itself Over the past six years, significant efforts have been made to
create a strategy and ultimately a structure by which the community can assemble to create
-
systemic change. Since 1994, Whirlpool Corporation has pledged $1 million per year that has v
been matched by otlier(businessorganizations to address regional economic development change 9
with special emphasis on Benton Harbor. f The results are tangible. The Main Street cose
from a 94% vacancy rate to just fewer than 4 5 % ~ Several new ,
E-iheeeii?iGeZ'g:6 area. Oier 1,750,000 square feet of abandoned
manufacturing space has been acquired and demolished.
 Unfortunately, the progress being made from an economic development standpoint has not
reached far enough into the community to effect change for all residents. $:order to deal with **
the issues of diversity and inclusion, the Council for World-Class Conmumties (CWCC) was
Tormed in 2001.4 This organization has been actively engaged in bringing the entire region
together to focus on the issues of diversity and inclusion, and to implement related strategies for
assisting the entire region, especially Benton Harbor.
The CWCC has trained hundreds of people to be “diversify-with- inclusion^^ facilitators who
conduct on-site diversity training at area businesses, faith institutions and organizations. Its
"Bridges to Digital Excellence" program is helping bridge the technology divide by providing
free computers and training to more than 630 Berrien County families (the majority of whom
live in Benton Harbor). Law Enforcement Diversity Training has also been held to help improve
the relationship between area law enforcement agencies and residents.
Collectively, the CWCC, Cornerstone Alliance, the United Way of Southwest Michigan, and a
host of other~orgaiizationshave engaged literally hundreds of individuals in helping to transform r
,the City of Benton Harbon By working cooperatively, these entities will continue to build upon
the revitalization of downtown Benton Harbor, and also the shared development opportunities
arising throughout Michigan's Great Southwest.
The Next Step.. .
The applicant recognizes that development opportunities in the City of Benton Harbor must be
viewed within the limitations and obstacles described above. Therefore, the regional strategy
embodied in the Edgewater - River Run project creates a development opportunity by which the
high millage rates in the City of Benton Harbor will not be a disincentive. By accessing enough
land to breate the 'critical mass --*-**A
needed for structural change, and by incorporating a high-end&
.
-> *-
community and all of the planned amenities that are associated with such a development,,
including ,recreational boating- ----&.--
access, the Wget market purchasers of homes and commercial +
centers .%il not be deterred by rthe~bhi~&er..thanaverage property taxes.$ Ultimately, the project
will generate the type of development that will create jobs .by cap<@J1izingon the greatest asset B
found in the community of Benton Harbor - namely .its waterfront8 The development is expected'
to create at least $200 million in new tangible tax base for the City, and with it an additional
$150 million in the adjoining St. Joseph and Benton Township parcels. This tax base will also
create new tourism-based economies, result in growth and employment, and over time, create a
community of choice in which new employers will locate in the area.
p e development will create a tax base that is over ten times the current size of the City of
Benton Harbor, and when completed, will provide the economies of scale to allow for more
tolerable tax rates for the residents and the potential for issuance of millage proposals necessary
;to re-invest in the school system and community policing proposals necessary to stabilize the
economy, improve individual achievement, and stimulate economic growth. In other words, the
'
.: project is of the size and scope considered necessary to create structural and sustainable change
A

+inthe city of Benton Harbor and with it create the economic stimulus sought for the entire
region.
%<
The success of the Edgewater - River Run redevelopment project hinges on the ability to turn
brownfield sites into productive assets. Due in part to its declining manufacturing base and
bankruptcies of such industrial giants as VM Corporation and Auto Specialties Manufacturing
Company among others, Berrien County has the second largest number of identified brownfield
sites in the state of Michigan (as measured by the MDEQ). 'Given the historical dependence o$
industry on watemont locations, the situation -has now 'developed whereby these orphaned {,
b"rb&e'lds are more than just unappealing to the eye; they are limiting accessibility to what are +
otherwise highly desirable waterfiont locations. 4

The work to be undertaken and outlined in this application is seen as the linchpin in synergizing
the community efforts to date. The Edgewater - River Run project and the ensuing brownfield
remediation efforts will juxtapose the economic revival of a community in which substantive and
structural change is desperately needed.

I C. Site Selection Process

Background Leading to the Selection of the Edgewater - River Run Site.. .
It's hard to overcome the paradoxes found in the cities of Benton Harbor and St. Joseph. A
master strategy known as -$e Harland Bar(ho1omew Study mas commissioned in late 19884hat
outlined a strategy capitalizing on the river and waterfiont areas of both Benton Harbor and St.
Joseph with an eye on driving development along Business Route 94 and Main Street to assist
the City of Benton Harbor. Numerous follow-up studies were conducted and several initiated
attempts at redevelopment occurred between 1989 and 1995. The stumbling block to these
developments was both hdamental as well as philosophical.
The hdamental challenges rested with the over 1,750,000 square feet of orphaned and
condemned manufacturing buildings that lay fallow between the two cities. In addition, the
remains and foundations fiom the former Auto Specialties Manufacturing site remained clearly
visible fiom the 3ean Klock Park areqas well as the City of St. Joseph, which further served to
limit private invehent.
The road systems, including an antiquated state highway (M-63) built over the top of the
Edgewater area with access ramps encumbering a massive 20-acre interchange at Jean Klock
Road (built originally to support heavy traffic to the once bustling manufacturing centers), all
served as an impediment to the creation of a viable redevelopment strategy.
The philosophical challenges occurred as a result of the differences between these two sister
cities. Several development strategies had more tax base located in the City of St. Joseph and
other strategies required that development occur in St. Joseph fust to drive and stimulate the
development in Benton Harbor.
The philosophical rift that was created was due solely to a lack of trust. In 1996, the
redevelopment efforts were rekindled. A consulting firm was retained to conduct a three-day
charret involving all elected officials, employees, and selected community residents to help
define a long-term vision that could be "shared" by both communities.
The outcome of this process was the ~~dgeyater:Redevelopment Plan", a complex strategy to,
redevelop an expansive area connecting.the5citigsof Benfon H a r b ~ and
r St. Joseph that -included,
what was once knowh as "the eighth most contaminated site .in Michigan" by the MDEQ.,
component of the p
-
dation of housi~~g.in t h e : g m c r i i : & a d area of$
*-
.
.
.L
A

pr, the Edgewater, WvCr Run fifbject is considered integral to the

"Edgewater Projeq. Accordingly, two-thirds of the funds available under I 1 ,
 the Michigan's Great Southwest Cleanup Fund will be earmarked by the applicant tod
Comerstone Alliance$a not-for-profit
.W-+"&mwlli.
.). -,.. intermediary that will oversee the Edgev&.$~;&ivve~&gg-~ ++
- - , d . " ^ * . - . P L ~ ' Q W ~ ~ ~ ~ &
5?/3
-project on-behalf of the Benton flarbor and St. Joseph, Brownfield Redevelopment Authorities.
b , ; ~.*. .
$ 2
P.Y

-/

The Process of Selecting Other Borrowers and Subgrantees. ..

While two-thirds of the community's RLF will be earmarked for .Edgewater - River Run, the
remaining funds will be accessible through the Berrien County Redevelopment Authority, with
information as to their availability being published on the county's website, through marketing
brochures, presentations, and special information packets which shall be provided to all of the
local units of government within the County's jurisdictional boundaries. This material will
convey general information about brownfield risks and the benefits of reuse, as well as how-to
information needed by target constituencies. Proposals will be received four times per year fiom
potential developers and small businesses who partner with these local units of government
andor individual brownfield redevelopment authorities.
Projects/sites will be prioritized and selected based on the strength of community partnerships, as
evidenced by input of local units of government and their financial andor staffing participation
in the planning and application process. To ensure public involvement, applicants will be
required to consciously identify the stakeholders network specific to their project by completing
a Worksheet for Stakeholder Identification such as that attached hereto as Exhibit #6. A
prioritization model based upon an applicant's submission of a ProjectlSite Profile Form and the
completion of a Site Prioritization Worksheet similar to those attached hereto as Exhibit #7 shall
provide the basis on which applications are screened. Computer software will be used to apply a
simple weighted sum methodology whereby each projectkite can be evaluated against how well
it fits up to 10 weighted, predetermined criteria established by the County based on local
community input. Furthermore, subgrant applicants must clearly demonstrate a 20% cost share,
and loan to value ratio& must not exceed 80%. Liens shall be filed by the Berrien County
Redevelopment Authority on all loan recipients.
Applicants will receive priority scores of as much as 20% if redevelopment efforts are taking
place in those locations where the unemployment rates for the immediate census tract area are
120% or higher of the countywide average. Further, projects will be given additional priority
contingent on signed investor andor developer agreements such that tangible taxable
investments are committed subsequent to the cleanup.
Community Involvement.. .
Applications will be compared to community redevelopment objectives, in which the citizens'
employment opportunities, neighborhood and housing options, commercial and retail space, and
recreational and cultural facilities are described and prioritized. Consideration will only be given
to projects demonstrating a consistency with the community's economic development goals, are
realistic in their ability to achieve these goals, are focused on longer-term objectives (with a view
10 to 20 years ahead), and which are supported by community consensus.

1 D. Description Target Market and Business Plan for RLF and Subgrants
Mrhir!pool Corpoi-ation,, in partne of Benton Harbor, St. Joseph, Berrien 6
County, and Cornerstone A1,lianc abk'kd to ,underwrite a project aimed at
identifying tangible development opportunities in and around .Klock Road, North Shore Drive,
 --- ,.- of the City of Benton Harbor.? The Melrose Company, a South .&
and the Higman Park Road areas
Carolina - based master developer has been retained bf%%irlpool and has been working with thg
I d icholas Group and Michael Redd & Associates to .develop _ _ _ * _ several
_
_* "
strategies capable-ofdriving
l.-C--.
taxable investments along the shared river arteries of Benton Harbor and St. Joseph$ Over the
past 12 months, over $500,000 has been invested in completing the preliminary market study p
necessary to evaluate the possibility of a planned, integrated, recreational and residential
community predominately located inside a designated (targeted) redevelopment area of Benton
Harbor called "Edgewater - River Run". An additional budget of $3,000,000 has been identified
to move this project into the underwriting and development phase. Additional budgeting and
planning information pertaining to this project are attached hereto in.:E@ibit'#5.
The Edgewater - River Run project will link Lake Michigan to the Paw Paw and St. Joseph s8
h e r s inside the designated redevelopment Area .through the construction of a Nicholas ( 9 ; ~X
)/%a
Signature Golf Courseand with it the residential components necessary to stimulate tax base and
adjoining commercial and industrial development within the City of Benton Harbor and
adjoining communities.
In order to bring formal structure to the Edgewater - River Run redevelopment plan, a Limited
Liability Corporation (LLC) will be formed involving Whirlpool Corporation, the Berrien
County Redevelopment Authority, the Benton Harbor and St. Joseph Brownfield Redevelopment
Authorities, and Cornerstone Alliance. Given the frnancial strength of Whirlpool Corporation
and Cornerstone Alliance, the loans and subgrants provided by the applicant in support of the
Edgewater - River Run project will be both highly collateralized and reinforced by an overall
financial capacity normally reserved for much larger projects. By earmarking two-thirds of the
funds to such a strong credit worthy and multi-jurisdictional project as Edgewater - River Run,
and by balancing the remaining one-third across smaller loans throughout Berrien County, the
financial viability and impact of the RLF Grant will be assured.

v u i t a i n a b l e Reuse of Brownfields ,

Through necessity and by choice, the community has become skilled at addressing the challenges
of brownfield redevelopment. The redevelopment strategy described herein for the Edgewater -
River Run project serves as the community's model for the sustainable reuse of brownfields in
which a collaborative effort links environmental protection, economic growth, and community
goals in a coordinated, comprehensive, and consistent manner. This model reflects the
co~nmunity's proactive efforts to overcome the hurdles of developing brownfields and its
commitment to sustaining the reuse of these properties through a coordinated communications
effort aimed at clearing-up misperceptions and educating stakeholders on the benefits of
brownfield redevelopment. To date, these efforts have included, but are not limited to the
promotion of an education, awareness, and information exchange utilizing the technical support
of the Federal EPA-sponsored Great Lakes Environmental Finance Center, and through
community meetings, seminars, and publications. Sq~port@g-theseefforts, a centralized point.of ,?
qontact or brownfield ombudsman.has been establfi;hed within the redevelopment authohties of
each conibuniq. Going forward, sustainable reuse will be further ensured by continuing to
prioritize projects that retain or create the largest number of better paying jobs, are unlikely to be
remediated and redeveloped in a timely manner without RLF support, have the greatest potential
to foster additional capital investment in the area, can be developed in ways that will not add to
 pre-existing contamination in the area, and are located in relatively close proximity to the
available labor pool.
Like Edgewater, the community recognizes the importance of integrating brownfield
redevelopment strategies with existing community plans and objectives geared toward job
creation, capital investment, improving neighborhood quality, preserving sensitive ecological
resources and farmland, maximizing the use of existing public services and infrastructure, and
reducing risk to human health, safety and the environment. In this manner, the community may
leverage other public and private hnds to the greatest extent possible, and ensure the sustainable
reuse of its brownfield sites.
Removing disincentives (and creating incentives) for voluntary remediation by facilitating access
to tax credits, deductions and other financial benefits, and continuing to support the
establishment of reasonable standards for risk-based remediation, broad liability protection for
innocent purchasers, and additional funding at the state and federal levels, and loan pools by
community-based lenders required to meet their Community Reinvestment Act obligations will
all help to support a sustainable brownfield initiative in the community. Further, the community
will remain supportive of the environmental management practices embodied in IS0 14000
standards that minimize hazardous substance use, prevent site contamination, and reduce waste
in a manner that improves the hture use of properties. To this end, energy efficient "green
buildings", open space, conservation, easements, and oiher innovative planning techniques ,
capable ,of ,c.ontributing, to the-quality of life both now and in the distant future will be
encpwaged. a

The sustainable reuse of brownfields is a priority within the applicant community. As noted4
above ,and-throughout this docurhent, the community has committed itself to a basic strategy-
built on co&unications and public involvement, strengthening and building the capacity of the
local goyernmental units and nonprofits
---- - such ai Cornerstone kliance, supporting streamlined-
regulati~~~,eiii&~~~~g~$rivate-sector investment, improving access to public financing,
preventing pollution, and influencing regional planning.

/ F. Creation andor Preservation of GreenspaceIOpen Space or Nonprofit Purpose

Cleanup and redevelopment is an important objective and the primary basis for this application.
However, given the socio-economic challenges existing within the City of Benton Harbor (see
Section B, above), this is but one part of a larger set of quality-of-life issues, not the least of
which is the creation and preservation of open space for public purposes.

--A ke~~finding
ofth~
Corpoiat'e Properties,Sfudy (described in, Section G, below) was the need to,
diversify thgLrecreation mix in the community by developing strategies that would link the%
riverfront in B&o-b,o_r_apd St. Joseph to the exi~ting~residentialneighborhoods. The Stud8
also:conc6%d that the need to incorporate .the Jean J.$Jqck Park area into a development strategy*
was' crucial to stimulate new investmeht in a region plaged by population and economic out- v
migration.*"Bqilt.around .a golf course and *residentialdevelopment, the Edgewater - River Ruqv
; project will accomplish these objectives, and exemplify a livable community in which vital T,
" -
resource land*~s~t~"bf*e"d';~~sustainable
,&. .--m.w-T*% &P*r-U.r.-

transportation trends are reversex and energy and non-.+,

d h m ' , a
renewable resources we conserved. M a t is currently a hodge-podge of former abandoned
manufacturing sites, old junkyards, and substandard buildings will be converted into
 sensitive" community in which the residents and visitors alike will benefit fiom integrated
walking trails, landscaped roads and dedicated wetland peas.
And while the,City of Benton Harbor has long had an outstanding . ..-. public facility in Jean Klock ,
PZk, due to fiscal restraints, the community is not able to mahtain the park in its hi&est and P
best usel statusdThe development of the mixed-use recreational venue Edgewater - River Run
will not only provide the funding-to maintain this important community asset, but will result 'in at t.
lea3*L$~&llionof additional park land being dedicatedAf&public purposes throughout the <:
Edgewater development area, and ,.jn~.d%72Jo&~wide public easement along all waterfiont
n s assessments will result in the accessibility and
1ocatlonsdpiQ c o m b i n a t i o ~ ~ e s t n c t i oand
maintenance of these park areas for the benefit of the public in perpetuity.

1 G. Community invo~vement 7
The Voices of the Community Support Positive Change.. .
The residents have made it clear that similar, tangible, and concurrent development must occur
both in the City of Benton Harbor and the City of St. Joseph. Having a noted lack of any r
waterkont development housing in the City of Benton Harbor, as was so readily seen in the City f

of St. Joseph, the leaders and residents City of Benton Harbor impressed on the Edgewater y
planning
-T
team the need to provide waterkont housing to create a sense of shared development
b e t w e e n i 6 ' c i t i e s . @ T h e residents emphasized how such a shared development would help
et ,
.-
draw the two co&unities together. , -7
c- mk55
; A social redevelopment strategy occurred when the Edgewater Operatlug Agreement?entered
into between the City of Benton Harbor, the City of St Joseph, Whirlpool Corporation, and ~ b +;L>g
J-+L2
Cornerstone Alliance dictated a shared development and a shared opportunity scenario.
Embodied within the agreement is the notion that housing in the Jean Klock Road area of the
City of Benton Harbor is critical to the success of the entire Edgewater Project.
-
History of the Edgewater Redevelopment and Community Involvement Process...
The first action of the Edgewater Operating Team was to hire Corporate Properties, Ltd. of
Rhode Island to conduct an exhaustive $150,000 economic modeling study, including the
development of a seven-year implementation plan for Edgewater. This plan concluded the need
to access public funding for the lowering of M-63, the elimination of the Klock Road
Interchange, and the demolition of the abandoned Benton Harbor Malleables, Superior Steel, and
the VM Corporation buildings.
Corporate Properties conducted interviews with over 100 stakeholder groups to best determine
the mechanics necessary to achieve the goal of a shared development strategy. The principals of
the Corporate Properties study were then incorporated into the Edgewater Operating Agreement.
As noted earlier in Section F above, a key finding of the Corporate Properties Study was the need
to diversifjr the recreation mix in the community by developing strategies that would link the
riverkont in Benton Harbor and St. Joseph to the existing residential neighborhoods. The Study
concluded that the need to incorporate the Jean Klock Park area into a development strategy was
crucial to stimulate new investment in a region plagued by population and economic out-
migration.
Progress Begins to be Seen.. .
The final Edgewater Agreement stipulated a need to determine ways in which shared
development could be seen by residents in both communities. Hence, as office development
sprang up in St. Joseph, redevelopment projects were worked on in downtown Benton Harbor.
For example, Whirlpool Corporation and Cornerstone Alliance helped redevelop a building
along Main Street in Benton Harbor for offices. The $3,500,000 renovation of this historic
building helped to bring 100 professional jobs back into the downtown area. Additionally,
several groups partnered with Cornerstone Alliance on the over $5,000,000 restoration of the
Fidelity Building, Benton Harbor's largest and oldest office building, which had been abandoned
for over 25 years. And that is just the beginning. During the course of 1996 through 2000
access to state funds to demolish the abandoned Benton Harbor Malleables facility occurred, and
the availability of $4,000,000 of state funding to anchor the M-TEC Training Facility in Benton
Harbor, and $16,000,000 to lower M-63 and eliminate the Klock Road Interchange all became
reality.
As old deteriorating buildings were demolished and cleared in Edgewater, new industrial
facilities such as the Whirlpool Cooking Technologies and Edgewater Automation centers were
built in St. Joseph. Shared projects such as Atlantic Automotive and Integrity Design were then
advanced in Benton Harbor.
Future Plans Callfor Additional Development.. .
Realizing the need to further drive development, the Edgewater Operating Team retained the
services of Partners Development, a Tennessee-based international consulting firm, to refine the
Edgewater Development Strategy, which included the active participation of many community
residents and city officials.
Partners began by affirming the community's need to further create strategies of development in
Benton Harbor and expand on the waterfi-ont development opportunities available in St. Joseph.
Funding was acquired totaling $1,800,000 to build a bridge connecting the St. Joseph Edgewater
area into Riverview Drive, which is the main corridor of Benton Harbor. Over $2,000,000 of
funds were acquired to redevelop 88 single family houses along the St. Joseph River as part of a
$60 million project in Benton Harbor called "Edgewater - Harbor Town", and an integrated
strategy that includes the Jimmy Carter Work Program taking place in 2005 anchors a 200 unit
single-family development which is also currently in the works in the City of Benton Harbor.
The integrated development and social strategy embodied within the Edgewater Redevelopment
Plan has become a reality and its recognition by the MDEQ, Federal EPA and numerous other
agencies and organizations as one of the most successful brownfield redevelopments in the
Midwest demonstrates the unified commitment of the community, its elected officials, and
partner organizations. However, more work is yet to be done.
The Culmination of Community Involvement (Edgewater - River Run). ..
The Edgewater Operating Agreement stipulates the need to have a structure whereby
representatives of each of the parties meet on a bi-weekly basis to provide updates on project
work and to plan for needed and necessary public discourse. Since the inception of the
Edgewater redevelopment effort, well over 100 public meetings at local units of government,
dedicated meetings, and public hearings have been held. Numerous meetings have been held
with neighborhood associations as part of the redevelopment effort and the Edgewater structure
has continued to serve as an effective platform from which the River Run project team has
solicited community involvement. Tools considered supplemental to this process have included
a range of written materials (regular news publications/briefs, targeted informational mailings),
and the internet. Future tasks include the creation of a database of available brownfield site
information that can be integrated with such tools as the Michigan Site Network, an industrial
and commercial site database created through a collaborative effort of the MEDC and the
Michigan Economic Developers Association.
Attached hereto as Exhibit #8 is a communications plan setting forth a process in which: 1) all
neighborhood associations are ensured an active role in the decision making process; 2) that all
state and federal stakeholder groups will be included; and, 3) public meetings will be held in
order to arrive at the final design and recreational use consensus for the Edgewater - River Run
project.
As is further contemplated in the Edgewater - River Run communications plan, a structured
partnership will be formed with the Governor's office, the MDEQ, the MDNR, the MEDC, and
the Michigan State Housing Authority. Local partnerships wiU be formalized with the
Brodeld Redevelopment Authorities of Benton Harbor, St. Joseph, and Berrien County, as
well as all neighborhood organizations in and around the redevelopment area.
Finally, a public relations fm will be retained to communicate ongoing progress to all citizens
of the area, and a team of graduate students fiom Indiana University will be utilized to follow the
project from inception to completion. Continually and throughout the project, significant efforts
will be made to interview residents regarding their concerns, issues, and aspirations for the
project and to obtain feedback with regard to the investments being made and the transformation
occurring within the community. Among the local stakeholder organizations whose members
will be asked to participate in this process include: the CWCC; the Citizens for Progressive
Change; the Benton Harbor Housing Commission; Cornerstone Alliance; the St. Joseph
Improvement Association; St. Joseph Today; and, the Benton Harbor Empowerment Committee.

/H. Reduction of Threats to'Human Health and Environment 1

Assessment and cleanup standards in Michigan are risk-based - that is, cleanup standards are
based on differences in presumptive risk, depending on whether the end use is residential,
commercial, or industrial. Properties that meet their respective standards and will adhere to the
prescribed end use need no further remediation. Where standards are exceeded, protection can
be obtained by removing contamination from a site through engineered controls that limit
exposure to contaminants, and also by restricting a property to a specific purpose or by imposing
institutional controls such as restrictive covenants that effectively reduce or eliminate the
exposure pathways, thereby mitigating threats to human health, safety and the environment.
The essential first step toward reducing threats to human health and the environment is to
inventory and categorize properties on the basis of location, size, use (present and past), identity
of owners and previous ownership, contamination in the soil and groundwater, source of
contamination (on and off-site), cost of remediation, futures uses, and so on. Working on behalf
of its partner communities, Cornerstone Alliance has begun to assimilate these elements into a
database that will serve as the centerpiect for a sustainable brownfields management program.
As with any database, its utility is dependent on the accuracy and completeness of the
information on which it is based. To this end, working closely with the MDEQ, Cornerstone has
concluded that much of the available information pertaining to soil and groundwater
contamination within the 500 acre Edgewater - River Run project area is preliminary or obsolete
in terms of its ability to support a determination with regard to the state's risk-based cleanup
criteria. Therefore, in order to quantify the risk and ensure protection, federal financial
assistance awarded under this RLF Grant will be used to 1) assess the nature and scope of
environmental concerns, 2) determine the remedies available under current Michigan law, 3)
identify the specific nature of the site contamination and the -degree of remediation that will be
required in light of the site's proposed future use, 4) determine the remediation plan most
appropriate to the project and the associated costs, 5) evaluate the proposed redevelopment to
determine if, and in what way it may serve as part or all of the required site remediation, 6)
determine the remedy that best meets the community's needs, 7) implement the selected remedy,
and 8) document the process as required by state, federal and local agencies, including due care
obligations with respect to any residual hazardous substances. By working in partnership with
the MDEQ in the brownfield redevelopment and remediation process, this RLF Grant will help
to identify solutions that will expedite redevelopment and protect the public interest in a time-
and cost- efficient manner.

II. Leveraging of Additional Resources 1

The Edgewater - River Run project has a $52 million overarching budget under which initial
funds of $3.3 million have been committed and provided as described in Threshold Criteria 'F',
above. At the heart of this development will be public recreation property including, but not
limited to, linear parks, and a 75-foot-wide public easement along all waterfront parcels as well
as the dedication of at least $1 million of appraised land into permanent park preservation. In
addition, the project is located inside a renaissance zone as well as a State-approved brownfield
redevelopment zone. Both designations provide significant tax benefits to the investor as well as
opportunities for tax increment financing for many of the eligible expenses tied to the project.
These incentives will be used to leverage the private investment necessary to create a successful
residential integrated planned development within a 500-acre area presently characterized by a
hodge-podge of former abandoned manufacturing sites, old junkyards, and substandard
buildings.
The Edgewater - River Run project is dedicated to utilizing land for affordable housing. Access
to RLF dollars will help leverage necessary investments in public utilities and environmental
cleanup required for a residential development, which are normally associated with local units of
government. Therefore, given the budget consequences found inside the City of Benton Harbor,
the community's proposal for this RLF Grant is considered a critical component for the
redevelopment of this particular brownfield area.
Finally, the River Run project will leverage more than = in infrastructure improvements
already made through various grants andlor other private investments, and all roads, water and
sewer lines will either be used as part of the project, or new lift stations and mainlines will be
upgraded for the betterment of the entire region.
In addition to the funds that the community has identified and committed to the Edgewater -
River Run project, a variety of other tools and leveraged sources of public funding have already
been accessed as part of the overall Edgewater Redevelopment Plan. Since beginning work on
this project in 1997, the MEDC, MDOT, MDEQ, and MDNR have all partnered with the
community in helping to bring new infrastructure and businesses into this key development area
through the community's leveraging of Tax Increment Financing, Single Business Tax
Brownfield Credits, Obsolete Property Rehabilitation Act funds, State Brownfield Site
Assessment Grants, Clean Michigan Initiative Brownfield Cleanup Funds, State Revitalization
Loan Funds, State Brownfield Redevelopment Grants, and Michigan Tax Free Renaissance Zone
benefits.
...... . . . . . . .
a ;hartjderidG&$he
". . . ./.. .. . ,'.: ..... .:. . . h!ea I ~ ~ .. ~. a,r c e l 'which
de$el]~~rijeIit'
c ,,? s ,~ .~ad,
tang aqtic~pgtkd+ivestmel;if tied :to.;the,project. Also
provided within this exhibit is a chart illustrating the County's integrated approach toward
brownfield assessment and financial leveraging.

IJ. Abiity to Manage Grants/ Management Structure

Berrien County has a long and excellent history of managing federal funds. The County is aware
of no instances of an adverse audit finding resulting fiom an audit conducted by a federal, state
or local governmental entity. Further, the County is not aware of any requirements to comply
with high-risk terms and conditions under agency regulations implementing OMB Circular A-
102. On an annual basis, an independent accounting fm audits Berrien County's major federal
programs in accordance with provisions of the United States Office of Management and Budget
(OMB) Circular A-133 Compliance Supplement. A summary of the-Single Audit Report
findings for the past seven years (1997 - 2003) is provided herein. Further, the relevant pages
fiom the audit reports are attached hereto as Exhibit #lo. During each of the past seven years,
the County has received an unqualified audit opinion and no material weaknesses in internal
control were noted. During the 2003 audit, two reportable conditions were identified and
corrective action plans have been implemented to correct these two conditions, the copies of
which have also been included within Exhibit #lo.
Berrien County
Single Audit Act Compliance
Schedule of Federal Financial Assistance
1997 - 2003 I
Federal Material Reportable Questioned Audit
Year
Expenditures Weakness Conditions Costs Opinion
1997 $3,522,197.00 None None None Unqualified
1998 3,771,072.00 None None None Unqualified
1999 3,877,791 .OO None None None Unqualified
2000 4,677,799.00 None None None Unqualified
2001 5,313,944.00 None None None Unqualified
2002 5,049,946.00 None None None Unqualified
2003 6,334,625 .OO None Yes* $21,750.00 Unqualified
* Corrective actions plans have been implemented to correct these reportable conditions which
relate to the HOME Investment Partnership Program and the Health Department Immunization
Grant.