KEVIN LEININGER: Do 29 prime downtown acres justify a blank check from Fort Wayne City Council?
Ten years ago, the city paid $25,000 for an option to buy a 29-acre former scrap yard just north of downtown for $4.3 million but never completed the deal — perhaps because, as Mayor Tom Henry said at the time, the city first needed to know how the property would be used and how much the environmental clean-up would cost.
Tuesday, City Council members will be asked to consider a resolution that would clear the way for the city to pay $4.63 million for the same site by assuming that cost as a “reasonable and necessary condition to achieving the redevelopment of the North River property to support the redevelopment goals of the city.”
But the resolution does nothing to address the questions that should be answered before council absolves the former OmniSource owners of any liability: How much contamination remains at the site, how much will it cost to remove and how much exposure should Fort Wayne taxpayers accept now in return for the possibility of economic benefits later?
“Should we do this if we don’t know the cost? I’m still pondering that,” said President Tom Didier, R-3rd, who believes council is faced with a difficult-to-resolve Catch-22: If it agrees to indemnify the property’s current owners, it will assume a financial liability that remains undetermined despite environmental studies that were conducted a decade ago but have never been released. But if council refuses, he said, a property considered crucial to downtown and riverfront redevelopment “could just sit there for the next 100 years.”
Council members aren’t the only people struggling with a Catch-22. When the city conducted its $80,000 environmental assessment 10 years ago, it agreed to keep the findings confidential until the property changed hands — which means council members will be forced to vote on assuming liability for the clean-up without being told details about what will be required and how much it might cost.
“We’re asking them to trust our expertise and assessment that they wouldn’t be assuming too much risk,” said Greg Leatherman, director of community development and the former director of city programs to clean so-called “brownfields” like the former OmniSource site. The previous study, he said, confirmed the removal of underground tanks, groundwater monitors that revealed acceptable levels of contamination and 90 soil borings that also revealed minimal levels of contaminants, mostly metals.
All of which might make the site unsuitable for housing but not for other possible tenants, including a hospital, science technology park, railroad-themed attraction or other commercial uses.
The city has a good relationship with the U.S. Environmental Protection Agency and the Indiana Department of Environmental Management and could probably qualify for clean-up grants, Leatherman said. Clean-up costs could also be recouped through development of the site, which would be directed by the Redevelopment Commission.
Any exposure to Fort Wayne taxpayers, he said, “would not be a big number if we do this the right way.”
Unfortunately, authorization of a “not to exceed” clean-up cost does not appear feasible. It is equally unfortunate the previous study contained a non-disclosure clause that prevents council members from being given the information they need and deserve in order to cast an informed vote.
Leatherman is right when he says council’s vote will be based to a large degree on the level of trust that exists between the Republican-dominated council and the administration of Democratic Mayor Tom Henry. Is that trust secure enough to persuade council to assume the environmental risk and the Capital Improvement Board to provide the restaurant tax revenues needed to pay for the land? Is council willing in effect to sign a blank check?
That prospect rightly worries Russ Jehl, R-2nd, who says council’s being asked to deal with an “unforced error,” not a Catch-22. Even though details of the old study can’t be released, he wonders why the administration can’t at least provide an estimate of clean-up costs. And if the cost is as negligible as some say it is, why the hurry to have the city bear the expense?
Didier and Leatherman agree: It’s a tough call. But Leatherman is right about something else: The property is an important community asset, and if the city doesn’t control it, somebody else eventually will — perhaps even a scrap yard or some other industrial use compatible with the contamination but not the community’s unfolding vision for downtown.
Here’s something else to consider: The agreed-upon purchase price of $4.63 million is well below the $6 million asking price and, thanks to inflation, that $4.3 million option in 2007 is equal to $5.24 million today. Does that make North River a good deal? I wish I knew and so, apparently, do City Council members who are supposed to expose public dollars on the basis of something more than an educated guess.
This column is the commentary of the writer and does not necessarily reflect the views or opinions of The News-Sentinel. Email Kevin Leininger at email@example.com or call him at 461-8355.