To add funds for cleaning up the Farmland site, the city is considering a contract with Chicago-based attorney who will pursue claims against insurance carriers for the property owners prior to Farmland.

In preliminary environmental surveys, ground contamination by various chemicals used in the plant was detected. The cost to remove the pollutants is estimated at around $2 million. The city expects to pay it through insurance and governmental

grants.

The city obtained a court order to enforce the demolition of the plant, which was damaged by a fire in July of last year. The $3 million cost for the demolition would be covered by a fund escrowed from insurance proceeds to Farmland. But, the retained money can be spent only on damages inflicted by the fire, not on pollution caused by pre-fire activities.

The city is targeting insurance policies held by Wilson Foods Inc., which owned the property for most of the last century until 1983. The city has already hired a firm specialized in the insurance archeology to research and identify several policies that were in force at the time of Wilson’s operation.

If approved at the council meeting Monday, the city will hire attorney Matthew Cockrell, and he will start negotiations for the insurance recovery. Cockrell is one of only a few attorneys in the nation who handle this type of work, according to City Manager Paul Sparks.

Although Wilson is bankrupt, the city believes the insurers are still liable for the coverage. Standard commercial general liability insurance policies are usually “occurrence-based,” which means they never expire if damage is shown to have occurred within the policy period.

Many insurance policies up to the 1960s contain no pollution exclusions and aggregate limits. Though policies after the mid-’80s started excluding coverage for pollution, some state courts interpreted that they would eliminate only expected or intended pollution.

The move indicates that the city is determined to acquire the land. Sparks said it will happen whether or not Farmland decides to resume operations in Albert Lea.

The city’s original plan was to exchange the land with new site in the Habben Industrial Park, assuming Farmland is coming back. The deal is still on the table, but the Chapter 11 bankruptcy filing by the stringent company in May has made the feasibility slim.

Now, the city will try to convince Farmland to give away the property, offering the takeover of environmental cleanup. A fear is that the premier gateway site to downtown will be abandoned for years if Farmland keeps the property.

The deadline for Farmland to initiate demolition is December. But the city wants to accelerate the process by obtaining another court order to forward the date, Sparks said. Upon the completion of demolition, either by Farmland or the city, the city will conduct a comprehensive environmental survey. If the city’s attempt to get the land is successful, redevelopment projects will follow.