Durham News

Cleanup cost concerns stall closing on police HQ site

Worries about soil contamination at the former Carpenter Chevrolet site have held up the city’s closing on the site for a new police headquarters.

Purchase of the 4.5-acre tract on East Main Street was scheduled to close Friday, but City Council members balked after learning that the amount of soil and asbestos contamination and the cost of dealing with it remain unknown.

“We’ve identified the potential for there to be a significant cost,” said Lori Denton of the Terracon environmental consulting firm, which is assessing the site for contaminants.

“We don’t think there’s a major smoking gun, but there’s potential for a lot of little ones,” she said, mentioning old petroleum tanks, drains and locations where automobile servicing equipment stood.

Attorneys for the city and the site owner, GWC Properties, reached verbal agreement Friday for a 60-day extension of the city’s option, according to City Manager Tom Bonfield.

“They’re trying to tidy up the terms,” he said.

In October, the council agreed to buy the GWC site for $5.5 million, along with another owner’s 0.84-acre adjacent tract for $200,000.

Terracon had recommended more testing at the site, and during their work session last week council members approved up to $40,000 for that purpose, raising the total contract price with Terracon to a maximum of $82,691.

“These additional services ... are reasonable and fair under these circumstances,” said General Services Director Joel Reitzer.

Terracon’s initial site assessment included “an estimate of the possibility of up to $254,000 worth of cleanup” required in preparing the site for construction, Reitzer said, but could be twice that much.

Based on its own assessment, he said, GWC thinks the cost will be considerably less.

GWC had already volunteered to set up a $500,000 escrow account to cover cleanup costs, an amount “more than sufficient,” said the firm’s attorney, Richard Prentis, who argued against putting off the closing during the council’s work session last week.

“We anticipated closing before the end of (last) year,” Prentis said, and had already agreed to extend the option several times.

The escrow account would be GWC’s total liability for cleanup, any amount above that would be at the city’s expense, Reitzer said.

Bonfield told the council he did not want to close the transaction until the members knew the potential risks.

Councilwoman Diane Catotti said she was reluctant to let the sale go through without knowing the extent of contamination and cleanup cost, particularly in light of unexpected contaminants that added cost and time to the Southside East apartment project.

“We’ve been burned before,” said Councilman Eugene Brown.

“The seller is asking us to take a risk that, in normal real-estate transactions, (is) not allowed,” said Brown, who owns a real-estate business. “At this point I cannot agree to move forward with the closing.”

The remaining site testing and cost estimates should be done in 30 to 45 days, Reitzer said.