City and county leaders are still looking at buying the vacant Farmland Industries site to turn it into an industrial park, despite the interest of a private company that’s ready to do the same.

Officials with Connecticut-based TRC Companies Inc. said Monday they were committed to turning the mothballed, 467-acre fertilizer plant into an industrial park – rather than residential or retail uses, which county leaders have opposed.

“We have no intention of taking on the city and the county to create an end use that doesn’t meet their vision,” said David Miller, senior project manager for the company. “We don’t have any interest in getting into an adversarial relationship.”

TRC had told the Journal-World in June that it was working through Farmland’s bankruptcy process to buy the property – which is east of Lawrence on Kansas Highway 10 – but at the time stopped short of ruling out nonindustrial uses for the site.

Building momentum

Douglas County Commissioner Charles Jones said despite the new statements from TRC, city and county commissioners were still exploring options for bidding on the property, which ultimately will be sold at a bankruptcy court auction.

City and county commissioners are scheduled to meet before tonight’s City Commission meeting in a closed-door executive session to discuss the property.

“We want two things for that property,” Jones said. “We want a clean site and we want industrial activity on the site. We’re not sure whether we’re going to get there best through TRC or by submitting our own bid.”

Jones said he anticipated city and county commissioners would decide within the “next few weeks” whether to attempt the purchase, which likely would cost several million dollars.

Representatives of the Farmland bankruptcy trust also sense a decision coming soon. Kamyar Manesh, the executive overseeing operations at the site, said four groups – including one just last week – had toured the site. He confirmed TRC and the city/county group had sent representatives to the property. Two other groups he declined to name also have been researching the property.

“The momentum has really picked up,” Manesh said. “I would not be surprised that in the next 30 to 90 days that there is some solid, solid progress on the sale of the property.”

Public vs. private

Jones said the site – which has been vacant since the plant closed in 2001 – was an important piece of property for the community as it sought industrial ground to lure new companies to town. He said commissioners needed to weigh whether it was best for the property to be controlled by the public or private sector.

“We would get some certainty that the property would be managed with the long-term interest of the community utmost in mind,” if the city and county bought it, Jones said.

Jones also said he had concerns a private company might seek control of nearly $6 million in escrow controlled by the Kansas Department of Health and Environment. The money was set aside by Farmland Industries to clean the property, which has significant amounts of soil and groundwater contamination related to decades of fertilizer spills at the site.

“We’re not interested in a short-term profit,” Jones said. “None of the city and county commissioners get paid more if we’re managing the Farmland site.”

Risk appetite

TRC is a for-profit, publicly traded company that specializes in cleaning up environmentally damaged properties. It posted a loss of about $8 million on revenues of about $370 million after undergoing a corporate restructuring in 2005. It expects to post a similar loss in 2006 before returning to profitability, according to financial statements it has released.

TRC’s Miller, though, said there were reasons a private company might be in a better position to undertake the project.

“There’s a certain amount of risk involved with the environmental cleanup of the site, and that is what we’re familiar with,” Miller said. “My take from both the city and the county is that they don’t have a very high risk tolerance when it comes to the environmental cleanup.”

Miller said he had met with representatives of the city and the county on numerous occasions. He said he had told them TRC would be interested in a public-private partnership involving the two governments. But if the city and the county make their own bid, that won’t deter TRC, Miller said.

“We’re prepared to compete with any potential bidder,” Miller said.

Industrial concerns

Other bidders also may emerge. Randy Jostes, president and chief executive of St. Louis-based Environmental Liability Transfer Inc., told the Journal-World in June his company was considering purchasing the site. On Monday, he said his company was still interested, but would want the option of developing some of the ground for residential or retail uses.

If city and county commissioners will allow only industrial development, he said, he’s concerned the site may remain uncleaned a number of years.

“I just don’t know that the market is calling for heavy industry on that site,” Jostes said. “I know everybody wants jobs, but I don’t know if there are manufacturers who want to be there.”

None of the potential bidders has indicated how much they would be willing to pay. Jones said the city and county hadn’t yet had detailed discussions about how they would pay for the site.

“We’re still dealing with the more fundamental issue of whether we’re going to be in the game or not,” Jones said.