$1 deal could turn contaminated St. Paul land into riverside park

St. Paul and ExxonMobil have reached a deal that would give the city control over a blighted 36-acre property that used to house oil tanks. It will be turned into parkland if the agreement is finalized.

By CHRIS HAVENS, Star Tribune

Last update: October 28, 2009 - 10:38 PM

The city of St. Paul has reached a settlement agreement with ExxonMobil for a 36-acre chunk of land that used to house oil tanks in the West Seventh neighborhood.

Under the agreement, the city's Housing and Redevelopment Authority would buy the land for $1, and ExxonMobil would give the Housing Authority $5 million for cleanup and redevelopment. The property must be used for permanent parkland and cannot be used for housing or commercial development, according to the agreement.

The City Council and Housing Authority approved the agreement Wednesday, but ExxonMobil still needs to sign off on the deal.

Representatives from ExxonMobil did not return a call seeking comment.

If the deal is approved, it's a significant end to a drawn-out legal fight that has spanned several years.

The land was once the site of separate oil tank farms owned by Koch Refinery Co. and Mobil Oil Corp. Neighbors and the city had been sizing it up since 1995, when both companies simultaneously shut down operations.

Koch sold its land, but ExxonMobil had been unwilling to sell its portion if the city was going to build housing on it. The company was concerned about future liability for the contaminated land.

The land is between W. Seventh Street, Otto Avenue, Shepard Road and Montreal Way.

The site had been envisioned as part of one of the city's largest housing developments ever. At one time, plans for the 65-acre Victoria Park called for 850 housing units.

The city said it could clean the land and make it safe for housing. In 2004, it began condemnation proceedings.

Last December, a court-appointed commission determined the land's value at $7 million.

Both sides disagreed with that and continued negotiating, said Cecile Bedor, the city's Planning and Economic Development director. That is when the agreement was reached.

"This is great news for the city. We have done a lot of work to redevelop this important corridor along West Seventh with new businesses, housing and clinics," Mayor Chris Coleman said. "Reaching this agreement allows us to continue that revitalization, clean up the land and create an asset for the community."

Bedor said it will take two or three years to complete the cleanup; 4 feet of clean dirt needs to be put down.

The pollution is petroleum hydrocarbon, the naturally occurring organic compounds in gas and oil. Bedor said it should be easy to remedy.

She said she hopes that gaining control of the land and turning it into park space will help spur development on surrounding properties.

A community process will be started and run by the West Seventh/Fort Road Federation to figure out what kind of park folks want, said Council Member Dave Thune, who represents the area. The park could be defined as a playground, trail, open space or sports fields, but stadiums would not be allowed.

Chris Havens • 612-673-4148

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