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Tuesday, November 30, 2004

Environment/Economic Development - Gary-NIPSCO lakefront deal moves forward

The Gary Post-Tribune reports today:


Gary Mayor Scott King’s plans for an open lakefront and expanded airport are closer to fruition after reaching a deal with NIPSCO for the city to acquire the Dean H. Mitchell Generating Station. Under the deal, the city gets 100 acres. King plans to use much of that land to expand Gary/Chicago International Airport’s smaller runway so it can accommodate large jets.

“There is only so much shoreline on the Great Lakes,’’ King said. “This is long overdue. We have an obligation to people to be as wise of a shepherd of this incredible asset.”

The area is close to property owned by Majestic Star Casino developer Don Barden and a 200-acre parcel the city would claim in a property tax settlement with U.S. Steel. “We’re talking about a water-front in excess of 500 acres,’’ King said. “The meetings with NIPSCO have been positive and non-confrontational.”

The city is contracting with a third party, which will provide insurance so that the costs to clean up the 100-acre site will be fixed and not increase later. Northern Indiana Public Service Co. says the generating plant has asbestos problems and will likely have PCBs and possibly other chemicals. * * *

Because the cost of remediating the site could be staggering, both NIPSCO and the city are contacting a third-party consultant to arrange for an insured fixed-price contract for the demolition and cleanup of the property.

The city hopes to select this company by next month and wants an estimated cost of remediation and demolition by next fall. The consultant will study the site and come up with the proposed costs. King said if the costs to clean the site go over the set price, the insurance will pay the remainder.

NIPSCO is under no obligation to fund the costs to clean the site under the deal. The city will try to drum up financial resources from state and federal officials. King admitted the cost of cleaning up the power plant site could change once the process begins. * * *

Earlier this year, NIPSCO and the city of Gary reached an agreement in which the company would not restart the aging Mitchell power plant. NIPSCO President Mark Maassel maintains the generating station, which was built in the 1950s, is obsolete and unreliable and would cost too much to start up again.

“We don’t see that as an effective way to serve customers,’’ Maassel said. “It costs us more to restart it.”

In May, King petitioned the Indiana Utility Regulatory Commission to take over the site after learning that the power company was considering restarting the plant. NIPSCO shuttered the plant in March 2002, but had listed the shutdown as indefinite.

An earlier ILB entry on these plans can be found here, dated July 25, 2004.

Posted by Marcia Oddi on November 30, 2004 08:39 AM
Posted to Environment