title
GAINESVILLE JOB CORPS CENTER FINAL SETTLEMENT AGREEMENT AND FINAL CONSENT ORDER (B)
recommendation
The City Commission: 1) approve the terms and conditions of the Settlement Agreement and the Consent Order and; 2) authorize the City Attorney to execute the Agreement and Order on behalf of the City of Gainesville.
explanation
INTRODUCTION
This endeavor originally started several years ago at the initiative of Erik Bredfeldt when he served as the City's Economic Development Director. Several lots at the Airport Industrial Park were affected by the contamination that migrated onto the City-owned property from adjacent property. The contamination made the lots unavailable for sale and development. The contamination also potentially threatened the City's wellfield which is downstream from Little Hatchet Creek raising concerns of GRU. The City Attorney's Office with the assistance of Bill Pence, Special Counsel, worked diligently over the past years to bring about this desired result.
BACKGROUND
In the early to mid-1990s, chlorinated solvent contamination was discovered at the Site. For several years following discovery, DOL, as the current property owner, worked with FDEP by retaining environmental consulting firms to attempt to delineate the extent of environmental impacts at the Site. By April 2001, the results of such investigations identified significant groundwater contamination present along the southern boundary of the Site, which had migrated onto several unimproved lots within Airport Industrial Park which the City seeks to sell for commercial development.
The source of contamination was suspected to have been the result of releases of chlorinated solvents from the Site during the former operation of The Sperry Corporation ("Sperry") manufacturing plant, which operated at the Site from approximately 1955 to 1978. To encourage Sperry to come to Gainesville in the early 1950s, the City's Employees Fidelity Fund ("EFF") entered into an agreement with Sperry pursuant to which EFF agreed to construct a manufacturing plant and office building at the Site in return for long term rental payments that were set based on the EFF's cost to acquire the Site and construct the buildings. Sperry closed the plant in 1978 and exercised an option to purchase the land for a nominal sum. On August 31, 1978, Sperry took title to the Site and, thereafter, sold the Site to DOL on October 2, 1978 at market value.
Migration of the contamination onto the northern parcels within Airport Industrial Park has impaired the City's effort to develop such tracts for commercial uses. To facilitate the sale of parcels within the periphery of such impacts, such as the parcel acquired by Florida Food Service, Inc., the City was required to indemnify the purchaser from any liability that may arise solely as a result of ownership of the parcel onto which the groundwater contamination had migrated. As a result, the City has doggedly pressed FDEP to require DOL, as current owner of the Site, and Unisys Corporation, as successor to Sperry, to complete site assessment and construct a permanent remedy for the Site.
In the early 2000s, DOL retained a new consultant that suggested, for the first time, that the impacts detected on the Site were not related to past uses of the Site but were, in fact, caused by releases of contaminants on the Airport Industrial Park parcels located immediately downgradient of the Site. Unisys agreed with DOL's consultant and further work at the Site stopped. The City then spent several years seeking to convince FDEP of DOL's and Unisys' legal liability for Site conditions. After several high level meetings, including one with current FDEP Secretary Mike Sole, the City was successful in convincing FDEP to file suit against DOL. After suit was filed by FDEP, DOL and Unisys agreed to pursue further investigations at the Site. The results of those investigations confirmed that the groundwater impacts present at the southern boundary of the Site, which have migrated onto several parcels within Airport Industrial Park, were the result of releases of contaminants from Sperry's manufacturing plant during its past operations.
FDEP, Unisys, DOL and the City have been engaged in negotiations over the past year in an attempt to resolve the question of liability for current contamination at the Site and the Airport Industrial Park parcels located immediately downgradient. As a result of the negotiations, the parties recently agreed (the City's agreement is subject to approval by the City Commission) upon the terms and conditions of a Settlement Agreement and Consent Order. A discussion of the major provisions of each document follows.
SETTLEMENT AGREEMENT
The Settlement Agreement requires Unisys to be solely responsible for performing all work required to remediate the reported chlorinated solvent contamination (trichloroethene and its breakdown products) at the Site, including the off-site impacts on the Airport Industrial Park parcels, pursuant to FDEP's cleanup criteria rule, 62-780 Florida Administrative Code ("F.A.C."). In return for this commitment, DOL agrees to pay to Unisys the sum of $728,000 as a cash-out settlement. DOL is obligated to pay additional sums to Unisys in the event the total cleanup costs exceed $3,360,000.00. DOL agrees to be solely responsible for remediating PCB contamination identified on the Site (which has not migrated onto Airport Industrial Park parcels).
The City's obligations under the Settlement Agreement are limited to several "in kind" services, none of which require any cash payment to Unisys. These include the following:
1. Grant access to City-owned or leased property as needed for the remedy.
2. Assist Unisys in obtaining access to property not owned or leased by City as needed for the
remedy, providing such effort does not require City to pay any sum of money or provide other consideration for such access.
3. Accept at no charge purge water from Site groundwater monitoring wells delivered by Unisys to City's permitted wastewater treatment facility. This is not expected to generate any material volume of wastewater (several hundred gallons at most).
4. Provide clearing and grubbing and installation of temporary gravel-based roads on City-owned or leased property, similar to that provided by City during prior investigations at the Site, as may be reasonably necessary for performance of the remedy. City Staff provided similar services during prior field investigations.
5. Prepare and record deed restrictions for City-owned property impacted by the reported contamination, limited to restricting: (a) use of groundwater for any purpose; (b) drilling for water on the property; and (c) installation of any wells on the property without FDEP's consent. The deed restrictions are limited to those already agreed to by FFS upon its purchase of an adjacent parcel within Airport Industrial Park and, therefore, are not expected to reduce the marketability of the remaining impacted parcels.
Unisys also agrees in the Settlement Agreement to assume City's environmental indemnity obligations to FFS with respect to the reported contamination and to extend such indemnity obligations to any subsequent indemnity containing similar provisions that the City may be required to provide in connection with the sale of other parcels in Airport Industrial Park impacted by the reported contamination.
All three parties agree in the Settlement Agreement to release each other from prior claims arising out of the reported contamination, providing each party complies with its respective obligations under the Settlement Agreement. (Note: Due to bulk and size, the Settlement Agreement is not attached and is available for inspection and review in the Office of the Clerk of the Commission.)
CONSENT ORDER
The Consent Order obligates DOL to pay Unisys the cash out sum provided in the Settlement Agreement. The Consent Order obligates Unisys to: (i) complete assessment and remediation of the reported chlorinated solvent contamination in accordance with 62-780 F.A.C.; (ii) submit a start-up report to FDEP within a specified time period; (iii) submit quarterly progress reports to FDEP; (iv) submit a pilot test report to FDEP within a specified time period; (v) submit a Remedial Action Plan to FDEP within a specified time period; and (vi) reimburse FDEP $81,721.56 for costs and expenses incurred by FDEP at the Site.
The City's sole obligation under the Consent Order is to provide access to Unisys to the City-owned parcels within Airport Industrial Park that are immediately adjacent to the Site and which have confirmed groundwater impacts present on them. The access must remain available until FDEP has issued a Site Rehabilitation Completion Order for the Site. Failure to provide this access will subject the City to stipulated penalties of $200/day.
In return for all parties having performed their respective obligations under the Consent Order, FDEP waives its right to seek civil damages or penalties against all parties for the reported contamination.
CONCLUSION
As a result of the City's persistent efforts to compel the responsible parties to proceed with remediation of the Site, the parties have now reached agreement on the terms and conditions to provide for remediation of the Site.
In order to facilitate the settlement, the City, subject to approval by the City Commission, has agreed to provide several limited "in kind" services that are not expected to result in any material commitment of time or expense by the City or its staff. In addition, the City will be required to provide access to several City-owned parcels within Airport Industrial Park and agree to record limited deed restrictions for such parcels. The extent of the deed restrictions are similar in nature to those obtained from FFS at the closing of the sale of an Airport Industrial Park parcel to FFS. In return for this limited commitment, DOL agrees to pay a substantial sum of money (at least $728,000.00) to Unisys to be used to fund site cleanup work and Unisys agrees to be fully responsible for implementing further investigation and remediation work at the Site, all in accordance with 62-780, F.A.C.
The City's proposed obligations under the Settlement Agreement and Consent Order are reasonable and should be approved by the City Commission in order to facilitate implementation of a final remedy at the Site.