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Archive for Friday, June 11, 2010

Former Farmland Industries property likely to be in city’s possession within the next 90 days

The former Farmland Industries site on the east edge of Lawrence has been vacant for several years. The city must decide whether to pursue ownership of the property or turn it over to private development interests.

The former Farmland Industries site on the east edge of Lawrence has been vacant for several years. The city must decide whether to pursue ownership of the property or turn it over to private development interests.

June 11, 2010

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After years of haggling, the former Farmland Industries property likely will be under city ownership within the next 90 days.

Farmland Industries deal nearly done

The city is moving ever closer to finalizing a deal to take ownership of the former Farmland Industries Plant. The deal is expected to be completed in the next 90 days. Enlarge video

City commissioners at their meeting on Tuesday will be asked to sign the final documents needed to complete the transfer of ownership from Farmland’s bankruptcy trust to the city.

City Manager David Corliss said once the documents are signed, the city likely would assume control of the 467-acre piece of eastern Lawrence property by October and then begin converting it into a business park.

City commissioners seem ready.

“As far as job creation goes, I think this is one of the biggest items I’ve ever been involved with,” said Mayor Mike Amyx, whose political career stretches back to the 1980s.

Commissioners have previously expressed support for the complicated deal that will put the property, which has been contaminated by years of fertilizer spills, into the care of the city.

Here’s a look at major provisions of the deal:

• The city won’t pay a purchase price for the property. Instead the city will assume all liability for cleanup of the site. The city will receive $8.5 million in funds from a trust fund set aside by Farmland.

• The Kansas Department of Health and Environment estimates cleanup of the property will cost about $15 million. The city must sign documents saying it is prepared to use its general taxing authority to clean up the property if trust fund money proves to be inadequate.

But Corliss said he does not believe the city will need to use taxpayer funds to do the environmental cleanup work. Instead, the city hopes to start selling clean pieces of the site to businesses by 2011. The city will use proceeds from the sales to supplement the trust fund.

The city also believes it will save money by using existing city employees for parts of the cleanup, which largely involves pumping nitrogen-tainted groundwater onto area cropland.

• If new types of contamination are found on the property, the city will be responsible for cleaning it up. But Corliss said the property has been studied for multiple years to assess its environmental condition.

“There are risks and there probably will be some surprises,” Corliss said. “But the property has been extensively analyzed and we think we’re in a good position to manage the project.”

• In addition to cleanup costs, there will be significant costs to extend infrastructure to the site. Corliss said city staff members have begun looking at ways to extend O’Connell Road north to 19th Street and to build a new road that would connect adjacent East Hills Business Park with O’Connell. Corliss said he may request about $1 million in city funding over the next two years to deal with some infrastructure issues. Other infrastructure costs may be financed using special benefit districts, which would require future business park tenants to help pay off those costs.

Amyx said the deal is not without risks, but he believes the potential rewards to the city could be great.

“This one just makes a lot sense,” Amyx said. “The location of the site being near city utilities, along a major corridor in K-10, next to East Hills Business Park, these are things that make a whole lot of sense.

“And this really is a chance for us to create a brand new entrance for the community.”

Corliss said several salvage crews already have begun to contact the city about removing the remaining tanks and structures from the site.

Commissioners meet at 6:35 p.m. on Tuesday at City Hall.

Comments

LogicMan 4 years, 6 months ago

I'm sure it will be expensive, but at least there's now hope to cleaning up that eyesore/open wound on a major entrance to the city.

dataman43 4 years, 6 months ago

thought to ponder on......how extensive is the groundwater pollution ? I remember back in the early 70's, the creek that flowed to the north to the Kaw river was always "green" in color from the waste that was dis-charged from there.

steveguy 4 years, 6 months ago

A BIG mistake. But thats Lawrence for you,

50YearResident 4 years, 6 months ago

The expenses and problems will now begin.

beerbaron03 4 years, 6 months ago

Did anyone else notice that they already removed a couple of the large tanks that were there?

Also, while I like the idea of getting rid of the eyesore, the last thing K10 needs is more unprotected left turns if that becomes a business park...it's bad enough already.

Richard Heckler 4 years, 6 months ago

Real estate sales are not going well.

Planning on revenue from sales of real estate will likely NOT come quickly.

Transparency is the issue here. Taxpayers need to know exactly how much WE are investing and exactly how much properties are sold for.

The real estate market is simply not that hot and no one on radio news sees any light at the end of this tunnel anytime before 2012.

Don't expect another unsustainable "boom town economy" to pull this off. It simply will not happen.

There is so much real estate on the market.

AGAIN Transparency is the issue here. Taxpayers need to know exactly how much WE are investing and exactly how much properties are sold for. City Hall has no idea who will buy this property and taxpayers cannot afford empty structures anywhere in Lawrence,Kansas.

Richard Heckler 4 years, 6 months ago

There is always this matter to keep in mind all the while rhetoric is coming from City Hall.

By Kim McClure

July 24, 2009

To the editor:

The July 14 editorial asks, “What’s downtown going to look like five, 10 or 15 years from now?” The answer can be known, and the picture is not pretty.

Lawrence has enough spending to support about 4.1 million square feet of retail space, but the City Commission permitted developers to expand the supply to over 5.5 million square feet.

Lawrence has too much retail space chasing too few vendors, which means that many stores go empty, especially in the older shopping centers like downtown.

The surplus development has stalled redevelopment plans downtown and has pushed the vacancy rates so high that disinvestment and blight now threaten. Investment, both public and private, is wasted. The taxpayers’ $8 million parking garage stands largely empty. The Hobbs-Taylor building and the 600 block of Massachusetts should be the top performing spaces in the community, but they have significant vacancies.

The recession has contributed to the problem, but had we properly managed our growth we would be much better off.

The developers’ short-term gain is now our long-term loss. Managed growth would have prevented much of the problem and would have protected and enhanced our downtown.

It will take many, many years to absorb this surplus space and, until this happens, it will be hard for downtown to compete. We can only look forward to many years of high vacancy and disinvestment. We need a City Commission that knows how to pace the growth of supply so as to protect our unique downtown.

McClure is from Lawrence

http://www2.ljworld.com/news/2009/jul/24/retail-space/?letters_to_editor

Richard Heckler 4 years, 6 months ago

America Is Over Stored

This decade's building frenzy produced a bumper crop of new retail space. But the occupants haven't materialized.

The carnage in retail hasn't been this bad since an anarchist bombed Chicago's Haymarket Square in 1886. In January, Liz Claiborne said it would shutter 54 Sigrid Olsen stores by mid-2008; Ann Taylor announced that 117 of its 921 stores would be closed over the next three years, and Talbots axed the Talbots Men's and Talbots Kids concepts and 22 Talbots stores. (Those muffled screams you hear are Connecticut preppies trying to suppress their rage.) Even Starbucks has scaled back its yearlong saturation-bombing campaign.

Blame that exhausted marathon runner, the American consumer. Fueled by cheap credit instead of PowerGel, she looked great at Mile 16, but bonked at Mile 23 and is now crawling to the finish line.

Sales fell in December, putting the cap on a miserable Christmas season. Last week the government reported that retail sales rose 3.9 percent between January 2007 and January 2008. But back out inflation and sales of gasoline, and retail sales fell in real terms in the past year. Clearly, demand is down.

And supply is up. This decade's building frenzy produced a bumper crop of new retail space—from McStrip malls built near new McMansions, to hip new boutiques in the ground floors of hip new Miami condo buildings.

But as is the case with those McMansions and condos, the occupants for new retail space haven't materialized. In the fourth quarter of 2007, the national retail-vacancy rate rose for the 11th straight quarter to 7.5 percent—the highest level since 1996, according to research firm Reis, Inc.

With new projects coming online—34 million square feet of retail space will be completed in 2008—the rate is expected to spike further to 8 percent. In the parlance of the trade, many chains are simply over-stored.

Con't http://www.newsweek.com/id/112762

Ron Holzwarth 4 years, 6 months ago

We don't need any more retail space with the growth of web based sales. Sure, we need grocery stores and gas stations, but for everything else? Buy it on the internet because it's cheaper even with shipping costs added.

Partly because the overhead of retail space is not there. Just think about how much property taxes the stores have to pay!

When you're ready to purchase, go to your computer and type in Ebay.com or any of thousands of other sites. Don't head for a store. That's old fashioned, and you can often avoid sales tax too. Here in Lawrence that's damn close to 9% right there.

GardenMomma 4 years, 6 months ago

I see that we will be on the hook for about $6.5 million at least, maybe more if the clean up ends up costing more than expected. Where's that money going to come from? Don't raise my taxes to cover that!!!!

Ron Holzwarth 4 years, 6 months ago

"Don't raise my taxes to cover that!" - GardenMomma

You might have to move out of Lawrence to escape higher taxes over this!

There's an undisclosed reason why the property is changing hands for nothing, you can bet your bottom dollar on that. There's no insurance on this deal except that the former owners are going to be off the hook once the papers are signed. So, the taxpayers here in town are going to have to pay if something surprising is discovered by the EPA.

LloydDobbler 4 years, 6 months ago

This is a big mistake...the City doesn't have the internal expertise to perform the environmental remediation let alone develop it. Congrats, City Commission. We are now officially looking for a home outside of the city limits.

Ron Holzwarth 4 years, 6 months ago

LloydDobbler, remember the wonderful job they did when they developed our beautiful RiverFront Retail Mall?

It was wonderful until the music stopped, and there weren't enough shoppers to fill the cash registers.

Thinking_Out_Loud 4 years, 6 months ago

Although I think the Riverfront Mall management could have recruited stores more appropriate for the Lawrence demographic, I don't think the Commission was responsible for the Riverfront Mall's demise. The collapse of the outlet shopping sub-industry was more drectly responsible, IMO. Look at the number of outlet malls left, and you'll see what I mean.

BruceWayne 4 years, 6 months ago

why was the city not involved all those years farmland was dumping toxins into the soil. as voters we BLEW the last two elections. we had better start getting it right, or Lawrence will be no more.

conservative 4 years, 6 months ago

Worst idea ever. We are bankrupt and raising taxes while unable to keep up with basic city repairs. Why would we want to add millions and millions of dollars of liability when others are willing to assume the risk themselves. Don't tell me because that way it gets cleaned up properly. If private companies were doing the cleanup they'd be held to the same criteria the city will be. Don't tell me it's because we need more industrial space on that side of town, the East Hills Business park is literally next door and has many vacant lots and many vacant buildings too.

repaste 4 years, 6 months ago

Who is the holding company that made a few million from the city off this deal?

BigPrune 4 years, 6 months ago

I did not know the City has laborers experienced in cleaning up environmental disasters. There must be more taxpayer money from Obama on the way.

I do like it when the City gets involved in things they know absolutely nothing about because they are ALWAYS money makers....like the M-T Bus, the Eagle Bend Golf Course, the parking garage downtown, the Lawrence Arts Center, or even the swimming pool.

Waste not want not: if we are not wasteful of our resources that we currently have, we will still have them in the future.

Richard Heckler 4 years, 6 months ago

Keeping as many dollars local as possible keeps money in town and creates jobs. Without jobs and local spending taxes will increase to cover the cost of this high tax dollar bedroom community. Shopping online will not save that much money.

Friday I purchased a new bike light at Cycle Works for $7.00 less than on line plus there would have been shipping costs.

If you shop on line Weavers is on line as well as the Free State Brewery. Many Lawrence stores offer shopping on line.

Unfortunately our retail community is overloaded = economic displacement NOT economic growth.

7,000,000 more homes going on the market = additional flooding to a flooded market

What is Lawrence looking at ? About a $20 million clean up?

As stated before counting on real estate sales to help fund the clean up is reckless and risky business and may well be a bad management decision in the end. Lawrence taxpayers cannot afford speculation.

Randall Uhrich 4 years, 6 months ago

Wow! 467 acres of free land! Might have a little bit of polluted groundwater, though. What could possibly go wrong there?

BigPrune 4 years, 6 months ago

Merrill, Your over retailed comment just perpetuates a fallacy created by the restrictive progressives who conspired to make it virtually impossible to rent out empty spaces for 5 years by imposing some of the worst red tape in the country for someone wanting to open a business. You should check into it, as your people are the ones who implimented those restrictions.

just_another_bozo_on_this_bus 4 years, 6 months ago

"by imposing some of the worst red tape in the country for someone wanting to open a business."

This is undoubtedly supported by mounds of exhaustive research, right?

BigPrune 4 years, 6 months ago

Just look at the development code the progressive commission passed, if you can get a copy. Luckily, the new commission changed their crazy policy.

I know because I wanted to open a business in Lawrence. Instead I went to Lenexa - much easier and far less red tape at the time.

just_another_bozo_on_this_bus 4 years, 6 months ago

Well, that certainly was exhaustive research-- not.

50YearResident 4 years, 6 months ago

I think it would be a good idea to have each commissioner that voted for this deal to sign a personal bond guarantee that says they will assume and pay any additional unforseen costs associated with this purchase that are over and above the estimated expenses that have been made public.

crackers 4 years, 6 months ago

Can the city rezone a few of those acres. Olive Garden restaurant, or possibly another bank would be nice at that location?

George_Braziller 4 years, 6 months ago

OK, I'm confused here. If a large part of the contamination is nitrogen-tainted groundwater, what's the point of pumping it from one spot to another? Yes, the crops would enjoy the extra nitrogen, but why does it have to be removed from the Farmland site? It's not like they're going to be drilling a well for drinking water.


"The city also believes it will save money by using existing city employees for parts of the cleanup, which largely involves pumping nitrogen-tainted groundwater onto area cropland. "

Tricky Gnosis 4 years, 6 months ago

I pretty much just skip any Merrill comment; it's just going to be angry agit-prop in which Business and Growth are the source of all evils.

vuduchyld 4 years, 6 months ago

Unbelievable, truly. We'll just take some city workers, give 'em some gloves and respirators, and we can take care of an environmental mess like this??? Terrible decision.

50YearResident 4 years, 6 months ago

Still not explained is how much contaminated soil depth (in feet) is going to have to be removed and where will it be disposed at? Also, how is this KC firm thas has a "financial interest" in the deal aqctually involved? I guess these questions will have to be presented to the Journal World public forum questions section to get answers.

dubstep 4 years, 6 months ago

Well, between this and the 155 acres on the Farmer's turnpike, we have no shortage of land for industrial use now! The CoC kept talking about the two biggest hindrances to our economnic development being our bad reputation (which the commish has taken big steps to redress such as approving every development, settling with Walmart, creating THREE new special sales taxes) and a lack of industrial space. Now the lawsuits with the 155 acres are slowing its development, and the cleanup will slow the farmland down, but according to the Chamber, we have addressed all of our "problems."

So if we fail to fill these spaces with the high-tech and high-pay jobs we were "promised" and instead get low-wage jobs or, even worse, empty buildings, then who can we blame? Will the CoC and commish stand up and say, "Ooops! Our bad!" or will they find another excuse? My guess: people will get upset and they'll go back to the "reputation problem" excuse.

irvan moore 4 years, 6 months ago

This is a really bad idea. The city can't afford to take care of what it has now.

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