City leaders want to purchase the environmentally troubled former Farmland Industries site, but they want to assure residents the deal won’t create a legal nightmare for the community.

City Manager David Corliss confirmed Monday that the city’s bid for the 467-acre property east of Lawrence will be contingent on the city having no legal liability to clean up the site that has suffered from decades of fertilizer spills.

Instead, the city will propose to the federal bankruptcy judge overseeing the property that the bankruptcy trust remain responsible for ensuring the property is cleaned to state and federal standards.

But Corliss said regulators will ensure the property is cleaned, and if the city owns the property, it will insist upon it as well.

“Environmental compliance is a very important value for the community,” Corliss said.

Corliss said city leaders feel most comfortable avoiding the legal liability that comes with the cleanup. In exchange for not taking on any of the cleanup responsibilities, Corliss said the city will not ask for any of the approximately $6 million that Farmland was required to set aside in an environmental trust fund. The bankruptcy trust will be allowed to keep that money to continue cleanup efforts.

The city, however, will ask for money from an administrative trust fund set aside for the property. Corliss said that money could be used to demolish buildings at the site and, perhaps, to extend sewer service and improve roads to the property.

Kamyar Manesh, who is overseeing the property for the Farmland bankruptcy trust, said the administrative trust fund contains about $7.8 million. A key question the court must answer, he said, is how the trust fund can be used. City leaders are planning to lean on the fund heavily to convert the property into a business park.

“We’re hopeful that the trust funds available will be a very strong start to get the property ready for use as an employment center,” Corliss said.

Whether the city gets a chance to do anything with the property remains a question. Manesh confirmed Monday that at least two other parties remain interested in purchasing the property. Manesh said TRC Cos., a large national firm specializing in cleanup of blighted property, has submitted a purchase proposal. One other entity, which Manesh said he could not identify, also has submitted a proposal.

Officials with TRC previously told the Journal-World they don’t have specific plans for the property, but just want to clean it so it could be sold. Attempts to reach a TRC representative were unsuccessful Monday.

Ultimately, the bankruptcy court will conduct an auction for the property.

“I’m very optimistic that we’ll have an active auction for the property,” Manesh said.

But the auction may not be a typical auction during which bidders increase the purchase price with each bid. Corliss confirmed that the city thinks the property can be bought without any upfront expenditure.

Instead, potential buyers likely will compete by bidding on how little money they would take from the two trust funds to return the property to productive use. In essence, the winner will be whoever can take over the property and leave the most money in the trust funds, which would be returned to Farmland creditors.

Corliss said that is how the city thinks it can afford to purchase the property during such tight budget times.

City commissioners at their meeting tonight are scheduled to give Corliss the authority to file paperwork with the bankruptcy trust to move the city’s bid forward.

Corliss said he did not have a good estimate of how long it would take for the property to come to auction. It could take the rest of 2007, he said.

“Quick is not a word that is going to be affixed to this project,” Corliss said. “There will be more lawyers than shovels for some time to come.”