City leaders are beginning to become more comfortable with the idea of purchasing the environmentally troubled Farmland Industries site, even though state leaders can't guarantee how high cleanup costs may run.
City Manager David Corliss said last week that he would be asking city commissioners in the near future to submit a new bid for the 467-acre property that sits along Kansas Highway 10 east of Lawrence. City commissioners have long been interested in converting the former fertilizer plant - currently controlled by a bankruptcy trust - into a new business park.
"It is just critical for the community to be constantly on the march for additional jobs," Corliss said.
But earlier this summer, it appeared prospects for the Farmland site were dimming. Leaders with the Kansas Department of Health and Environment estimated it would cost between $10 million and $16 million during the next 30 years to clean up the property, which has been damaged by years of nitrogen fertilizer spills. Those cost estimates were significantly higher than the $5 million mark that city leaders had been contemplating.
Commissioners also said they wanted KDHE to agree to a monetary cap of how much the city would have to pay for any future cleanup costs. KDHE recently notified the city that it could not agree to such a cap, Corliss said.
But several commissioners this week said they were still interested in looking at a possible purchase. Mayor Mike Dever said that since July, when KDHE announced its cost estimates, he has talked in detail with state regulators familiar with the site and past consultants that have worked on the property.
"I'm more optimistic because I've had more time to digest the technical data and determine that the information is valuable," said Dever, who is an environmental consultant by trade.
Willing to take risks
City Commissioner Rob Chestnut also said the lack of a firm financial cap by the state was no longer a deal-killer for him. He said he's become more comfortable with the city's ability to handle the cleanup, which primarily involves pumping nitrogen-tainted ground water to ensure that it doesn't spread to other water supplies.
"In most economic development opportunities, you are going to have to take some risks," Chestnut said.
The city may be willing to take more risks now that other economic development opportunities are in motion. The city in July committed $75,000 a year for 10 years to help fund the construction of a new biosciences incubator on Kansas University's west campus. One of the major concerns of commissioners at the time was that the incubator facility would be built, would grow promising companies, but then the community would not have a new business park for the companies to grow into.
Commissioners are in agreement that the Farmland site may be the best in the county for industrial and business park development. It is serviced by a rail line, has access to Kansas Highway 10, and is adjacent to the East Hills Business Park.
But some still have nagging doubts.
"Not having the cap, that is a concern," Commissioner Mike Amyx said. "As I look at this, we're going to have to have a discussion as a community. Now is the time to decide whether we are in or out."
The money factor
Money, of course, is the big fear. The property is unique because when Farmland Industries filed for bankruptcy in 2002, it was required to set aside several million dollars in trust funds to pay for future site cleanup. City commissioners long had thought the trust fund money would be enough to cover all cleanup costs and perhaps cover some infrastructure costs, such as extending sewer and roads to the site.
But the new cost estimates by KDHE raised the possibility that the trust funds may not be enough to cover even the cleanup costs. Currently, the trust funds contain about $10 million.
Dever, though, said he's becoming more comfortable with the idea that the city may be able to do the cleanup for less than what the state has estimated. He said the city has employees in its Utilities Department who are well versed on complying with environmental regulations. The department also has employees trained to operate and maintain a variety of pumps that would be used in the cleanup process.
"Instead of paying a private contractor $100 an hour, we may be able to pay someone in-house $25 an hour to do the same job," Dever said.
Commissioners are scheduled to talk about the Farmland project in more detail at their Nov. 18 meeting.