Posted on 06.04.15
Legal, cleanup costs for old Bozeman landfill add up
Source: http://www.bozemandailychronicle.com, June 4, 2015
By: Eric Dietrich
Between multiple lawsuits and an expensive cleanup project, the city of Bozeman’s leaky former landfill off Story Mill Road is an expensive liability for taxpayers, totaling almost $2.2 million in costs and counting since 2012, according to a financial document released this week.
However, the issue shouldn’t have a major impact on city services if a plan to sell the city’s North Park property goes through and the city’s attorneys get landfill-related costs covered by its insurance, said City Manager Chris Kukulski and other city officials.
The financial report, prepared by the city at the Chronicle’s request, indicates that $1.3 million of the $2.2 million figure has gone toward engineering to study the issue and design a new system to alleviate contamination from gasses seeping from the old dump.
Actually building the system, which is required by state environmental regulations, will cost the city at least $2 million more, said Public Works Director Craig Woolard. Those costs will be financed with a 20-year loan, he said.
The city has spent another $321,000 installing systems to pump potentially harmful gasses out of homes built near the landfill in the Bridger Creek phase 3 neighborhood. That includes payments to 25 homeowners intended to cover electric bills for operating the systems for 10 years, sums that range from $1,009 to $2,017 each.
“If there was a problem, we wanted to address that,” said Woolard, adding that the in-home systems could be installed in months, while work on the primary remediation system on the landfill site is still ongoing. “That was a proactive public health call.”
“It was the right thing to do to defend the city against future claims,” Kukulski said.
A study commissioned by the city, released in April, has since determined that volatile organic compound levels in Bridger Creek homes were on par with typical American residences, and that chemical exposures attributable to landfill leakage present a negligible health risk. Those findings have been questioned in court filings by attorneys representing one of several groups of homeowners who have filed suits against the city and Bridger Creek developer Golf Course Partners.
The company that prepared the risk assessment, Maryland-based CPF Associates Inc., is one of many environmental science, engineering and law firms that have received money from the city for landfill-related work. CPF was paid $48,010 for its work with the risk assessment.
Others firms listed in the city’s financial report include the Helena-based law firm Gough, Shanahan Johnson & Waterman, PLLP, paid $387,018 to date; Manko, Gold, Katcher and Fox LLP, a Pennsylvania-based law firm that has been paid $17,632; and the local engineering firm Nicklin Earth & Water, Inc., paid $12,837.
Tetra Tech, which oversaw the installation of the in-home mitigation systems and has been the city’s primary environmental engineering firm with the landfill issue, has been paid $1.5 million. The company is headquartered in Pasadena, California, and maintains a Bozeman office.
Additionally, the city has spent $221,000 so far to assert that it does indeed have insurance coverage for landfill-related cleanup work and liability. Those costs stem from a tangled dispute involving the Montana Municipal Interlocal Authority, an insurance pool for Montana towns and cities, and the entity that underwrote the city’s environmental policy, Pennsylvania-based XL Insurance Co.
The city has spent another $321,000 installing systems to pump potentially harmful gasses out of homes built near the landfill in the Bridger Creek phase 3 neighborhood. That includes payments to 25 homeowners intended to cover electric bills for operating the systems for 10 years, sums that range from $1,009 to $2,017 each.
“If there was a problem, we wanted to address that,” said Woolard, adding that the in-home systems could be installed in months, while work on the primary remediation system on the landfill site is still ongoing. “That was a proactive public health call.”
“It was the right thing to do to defend the city against future claims,” Kukulski said.
A study commissioned by the city, released in April, has since determined that volatile organic compound levels in Bridger Creek homes were on par with typical American residences, and that chemical exposures attributable to landfill leakage present a negligible health risk. Those findings have been questioned in court filings by attorneys representing one of several groups of homeowners who have filed suits against the city and Bridger Creek developer Golf Course Partners.
The company that prepared the risk assessment, Maryland-based CPF Associates Inc., is one of many environmental science, engineering and law firms that have received money from the city for landfill-related work. CPF was paid $48,010 for its work with the risk assessment.
Others firms listed in the city’s financial report include the Helena-based law firm Gough, Shanahan Johnson & Waterman, PLLP, paid $387,018 to date; Manko, Gold, Katcher and Fox LLP, a Pennsylvania-based law firm that has been paid $17,632; and the local engineering firm Nicklin Earth & Water, Inc., paid $12,837.
Tetra Tech, which oversaw the installation of the in-home mitigation systems and has been the city’s primary environmental engineering firm with the landfill issue, has been paid $1.5 million. The company is headquartered in Pasadena, California, and maintains a Bozeman office.
Additionally, the city has spent $221,000 so far to assert that it does indeed have insurance coverage for landfill-related cleanup work and liability. Those costs stem from a tangled dispute involving the Montana Municipal Interlocal Authority, an insurance pool for Montana towns and cities, and the entity that underwrote the city’s environmental policy, Pennsylvania-based XL Insurance Co.
XL, said city Finance Director Anna Rosenberry, has been “absolutely unresponsive” after denying the city’s claims without explanation, leaving no way to challenge the denial other than legal action.
“We’ve been denied the insurance coverage that we paid for,” she said.
Kukulski said the landfill was listed on documentation provided to the insurers, and that MMIA is covering the city’s defense costs for the time being. However, he said, if the courts rule against the city on the matter, “Then we’re going to have to take a whole new look at the financial plan.”
The sale of the North Park property also represents a “critical piece” of the city’s plan to manage the costs of the landfill issue, Kukulski said, providing revenue to replenish a pool of money that had been previously set aside for post-closure costs associated with the landfill. Previously, the City Commission voted to sell the property for $1.5 million, though the deal hasn’t been finalized and faces an August deadline.
If both the insurance coverage and the sale fall through, Kukulski said, the city will likely have to dip into its cash reserves then build them back up with several years of bare-bones budgets.
The 85-acre North Park property, formerly known as Mandeville Farm, was acquired for $3 million in 2003 as part of a never-realized plan to build a city waste transfer station. The city’s hopes for the property were abandoned after a local developer sued on the basis that a former city manager had undermined a plan of his own to buy the land.
“We’ve been denied the insurance coverage that we paid for,” she said.
Kukulski said the landfill was listed on documentation provided to the insurers, and that MMIA is covering the city’s defense costs for the time being. However, he said, if the courts rule against the city on the matter, “Then we’re going to have to take a whole new look at the financial plan.”
The sale of the North Park property also represents a “critical piece” of the city’s plan to manage the costs of the landfill issue, Kukulski said, providing revenue to replenish a pool of money that had been previously set aside for post-closure costs associated with the landfill. Previously, the City Commission voted to sell the property for $1.5 million, though the deal hasn’t been finalized and faces an August deadline.
If both the insurance coverage and the sale fall through, Kukulski said, the city will likely have to dip into its cash reserves then build them back up with several years of bare-bones budgets.
The 85-acre North Park property, formerly known as Mandeville Farm, was acquired for $3 million in 2003 as part of a never-realized plan to build a city waste transfer station. The city’s hopes for the property were abandoned after a local developer sued on the basis that a former city manager had undermined a plan of his own to buy the land.
