Batesville Herald Tribune, Batesville, Indiana

June 13, 2014

Underground contamination will be cleaned up

Debbie Blank The Herald-Tribune
The Batesville Herald-Tribune

---- — State rules have caught up with an abandoned Batesville business.

Mayor Rick Fledderman said June 9 during the Batesville Board of Works meeting that there has been an investigation of the former Feller’s Service Station, now owned by Becker Properties LLC, Batesville. “The conclusion is the city is going to acquire that property” if the two other BBW members agreed.

Attorney David Guevara of Taft Stettinius & Hollister, Indianapolis, explained, “In 2012 we became aware of the fact that 18 N. Elm St. had underground storage tanks that were used for a gasoline service station that were out of compliance” with Indiana Department of Environmental Management standards.

If tanks are not intended to be used for six months, they must be temporarily closed to prevent leaks. If not used for 12 months, they need to be permanently shut down.

The attorney reported, “We approached the owner of the property and inquired about his intentions … the owner didn’t have the financial wherewithal to properly address” the issue.

The mayor had a limited subsurface investigation done in March by August Mack Environmental, Indianapolis, to determine if the tanks had leaked and there was contamination.

In April results showed “that indeed both the soil and groundwater at the site are contaminated,” Guevara reported. IDEM set the acceptable limit of benzene (a gasoline component) in groundwater at 5 parts per billion. The Elm Street site exceeds that number by “a signification amount,” testing at 185 parts per billion. Guevara advised, “This is a contaminant release that is going to need some attention.”

He met with the owner again and the response was the same. He could not financially afford to remedy the problem.

The study showed “there are at least 6 inches of product in the tanks, a further source of contamination.”

Fledderman and Guevara discussed possible solutions. If the owner is unable to address it, “the city could come in possession of the property and take care of the contamination.” For underground storage tanks, there is a state excess liability trust fund to fix releases from properly registered storage tank systems. An entity can use up to $2 million for investigation and remediation.

In order to qualify, the firm must be properly registered with IDEM and pay annual fees. According to the attorney, “Unfortunately, the property owner has not paid” the fees since 2010. He explained if the city came into possession of the property and paid past Becker Properties LLC fees totalling $1,080, it can qualify for trust fund dollars.

Guevara noted there is a $35,000 deductible before the city could access the trust fund. “Before you could remediate the site, you would have to remove the underground storage tanks” at an estimated cost of around $35,700, which is not covered by the trust fund. Board members learned the city would end up spending about $70,700 before state trust fund money could be used to remove the tainted soil and other underground materials. After remediation, city leaders would sell the property with the hope of recouping spent funds.

Guevara continued updating BBW. “The property owner indicated the transfer could occur, but it would be for a significant amount of money ... he eventually agreed to transfer the site” if the city pays the outstanding property taxes.

Fledderman said during executive sessions in the fall and recently, the city council and BBW have been made aware of the situation.

He added, “There have been some people who have expressed interest in this property,” but had environmental concerns. The mayor observed the former gas station “continues to be an eyesore, a detriment to that neighborhood and could affect neighboring properties and property values.”

Guevara said the vacant property is considered a “brownfield,” a site that’s underutilized for economic development purposes because now no property taxes are being paid and no persons are employed there. “It has a ripple effect on the values of surrounding properties.”

A timetable was detailed. Fledderman said state officials need 60 days notice before anything could happen. Guevara said once the tanks are removed, the extent of the problem could be understood by 2015’s first quarter.

Clerk-Treasurer Ron Weigel asked whether IDEM inspects the property once remediation has occurred. According to the attorney, “You do get a no further action letter from IDEM ... It would protect you from a negligence suit, but it’s not a release of legal liability.” With the letter in hand, the lot “becomes very marketable. A developer would know no further action is necessary.”

City officials had questions. Gene Lambert, a BBW and council member, said, “We believe this is in our best interests to get this cleaned up. Let’s just say we don’t do anything with it. Who has to clean it up at that point?” Guevara said if Batesville leaders are aware of contamination, they must act.

He added that investigation results must be reported to IDEM. If the city doesn’t want to take over the property, the state agency “would seek to have the current property owner address the issue” by issuing a special notice of liability letter. If there is no response, the state department likely would issue an enforcement order that, if ignored, could result in fines and penalties. “In the long term, IDEM may address the impacts then and more likely than not put a lien on the property ... that would be years” from now.

Council member Jim Fritsch asked about the possibility of the Indiana Department of Environmental Management waiving property taxes and underground storage tank fees to lessen the financial blow to the city. The attorney’s opinion? “It’s unlikely.” Meanwhile, the city would have to spend money on attorney’s fees for the waiver documents.

Fritsch then questioned, “What are the health hazards with benzene ... Are they talking cancer or irritants?” The attorney explained because the concentration of benzene and its duration underground hasn’t been determined, “it’s too difficult to tell.”

Council member Kevin Chaffee wondered, “What if the cleanup cost exceeds $2 million?” According to Guevara, the environmental consultant estimated it would cost around $272,000 for a more complete investigation and remediation. If, however, the work did exceed that $2 million, “the city would have to find another way to fund it,” possibly a state brownfields remediation grant.

Chaffee made a suggestion. “What if we hired that consultant to come back in and widen the scope of the investigation? Take a month and get some additional samples and analyze them” to fully understand the cleanup’s extent and estimated cost. The civil engineer said, “I’ve seen these kinds of projects start out at $200,000 and end up at $5 million.”

Fritsch agreed with Chaffee that more boring samples are needed to assure the remediation won’t exceed the $2 million state limit.

Council member Beth Meyers disagreed with the need for more borings. “There’s no reason to prolong the issue.” Guevara reasoned even if the consultant’s estimate is “off by 100 percent, you’re still way under $2 million.”

One attendee weighed in on the problem. Mike Vonderheide, who worked for IDEM when it started the underground tank program 25 years ago and was the former Batesville Water and Gas Utility manager, cautioned, “This contamination could have gone blocks down the street” because many lines have been replaced. “Be prepared for it to get very much bigger ... this could be a very long-term remediation and a long time before you would ever be able to think about selling the property.” He predicted a clearance letter could take 10-20 years.

In the end, the Batesville Board of Works voted to allow the property to be transferred to city ownership.

Fledderman emphasized, “It is a tough situation for the city to be in.”

The Batesville City Council voted to proceed with funding 4-1, Chaffee opposed because he wanted more investigation before committing city funding. The mayor said the initial $70,700 could possibly come from the Cumulative Capital Development, Cumulative Capital Improvement, Rainy Day or Economic Development Income Tax Fund.

Debbie Blank can be contacted at debbie.blank@batesvilleheraldtribune.com or 812-934-4343, Ext. 113.