‘Cast of Thousands’ Helps Farm-Way Make Over Ex-Brownfield

  • Dennis Perusse of Lajeunesse Construction works on the Farmway expansion in Bradford, Vt., on Aug. 27, 2015. (Valley News - Jennifer Hauck)

    Copyright © Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

  • A single boot rests on a window sill above a display wall in Farm-Way Inc.’s new addition on Thursday, Aug. 11, 2016, in Bradford, Vt. (Valley News - Mac Snyder) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

  • From left, Farm-Way Inc. owners Carol Metayer, Bobbie Gallerani, Paul Gallerania and Skip Metayer stand for a portrait in the store's new 18,500 square foot addition on Thursday, Aug. 11, 2016, in Bradford, Vt. (Valley News - Mac Snyder) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

  • Aerial photographs of Farm-Way Inc.’s property, family photographs, maps and a calendar hang from the wall of the office in the apparel section of the store on Thursday, Aug. 11, 2016, in Bradford, Vt. (Valley News - Mac Snyder) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

  • Taxidermy is interspersed among retail displays in Farm-Way's addition on Thursday, Aug. 11, 2016, in Bradford, Vt. (Valley News - Mac Snyder) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

  • Amid piles of boxes filled with gear, veteran employee Alicia Hood works to inventory merchandise in the rear of Farm-Way Inc.’s 18,500 square foot addition on Thursday, Aug. 11, 2016, in Bradford, Vt. (Valley News - Mac Snyder) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

  • Farm-Way Inc.’s 18,500 square foot addition extends from the rear of the retailer’s original store on Thursday, Aug. 11, 2016, in Bradford, Vt. (Valley News - Mac Snyder) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com.

Valley News Business Writer
Sunday, August 28, 2016

Bradford, Vt. — It takes a village.

In the case of Farm-Way, it was actually a town.

Not to mention a federal program, three state agencies, one state board, two nonprofits, an act by the Legislature, two banks and public hearings — not to mention lawyers. And not least, a business owner with a lot of patience.

Those are the parties whose participation was required for Farm-Way, Bradford’s noted clothing, farm and recreational supply store, to build a 19,500-square-foot expansion on a designated brownfield site. The addition, which finally opened last month, six years after its conception, provides a long-needed warehouse and retail space for Farm-Way’s boot and shoe department.

“It was a long, long process and I’m sure for the people at Farm-Way it must have bordered on agonizing,” said Ted Unkles, a member of the Bradford Selectboard.

“It’s a little more complicated to do business in Vermont,” said Carol Metayer, president and co-owner of Farm-Way.

On the other hand, the $1.8 million project showcases how the public and private sectors can collaborate to clean up a contaminated property, develop it, return the asset into operation for a local employer and place it back on the town’s tax roll.

“From our perspective and others its to be used as a model in the redevelopment of private property,” said Eric Sandblom, principal engineer of KAS, the Williston, Vt., environmental firm that was hired to clean up the brownfield site.

Crimped for Space

Farm-Way draws shoppers from across the Upper Valley and Twin States to its barn-like complex off Interstate 91, a short distance from the Bradford exit. Opened in 1983 as a feed store managed by Metayer, the operation expanded into apparel — the first in the Upper Valley to carry a then little-known brand called Carhartt — before the business was acquired by her parents, Paul and Bobbie Gallerani. Over the years the Galleranis and the Metayers, who later became co-owners, added camping and hunting gear, outdoor furniture, home furnishings, gardening and pet supplies to Farm-Way’s shelves. Today, the business has 42 employees and generates more than $11 million in annual sales.

Yet despite an 18-acre property and steady growth, Farm-Way was always crimped for storage space. More than 20,000 pairs of footwear were stocked in four trailers, requiring sales staff to dart outside the store each time to fetch a customer’s particular size of boot or shoe picked from the display wall. The Metayers bought a golf cart for the 200-foot trip to ease the burden for employees.

Farm-Way had spent years looking for a way to bring its shoe stock under one roof, but had limited options when it came to building an addition onto the 31,500-square-foot main building. Adding a wing to the front or east end of the building would have extended into the parking lot, and building out on the west end was blocked by the old Boston & Maine railroad tracks.

The only feasible option was to build on the backside of the main complex to the north. But that presented a problem: A portion of the land upon which the addition would protrude was owned by the estate of Twin State Fertilizer, a supplier that operated on the site from 1972 to 2008 when it fell into bankruptcy after its owner died.

More troubling, the adjacent 1.35-acre parcel was a designated brownfield site with an assortment of toxic chemicals left by the mixing of fertilizer ingredients. Bradford Oil Co. had also once operated on the site, leaving its petrochemical footprint in the soil.

Environmental analysis had found in the shallow soils polycyclic aromatic hydrocarbons, total petroleum hydrocarbons, and dioxin and furan congeners. Traces of pesticides, herbicides and metals were also detected in the ground water but, with the exception of one location, were within acceptable state levels, according to a report by KAS.

If Farm-Way were to buy the property, it would have to bear the costly cleanup of chemicals left in the ground that had also contaminated two structures. Moreover, Farm-Way, as owner of the property, would be exposed to any liability claims arising from the pollution.

On top of the environmental and legal complications, the Twin State Fertilizer property owed the town of Bradford $65,000 in back property taxes. Liens had been filed against the estate stemming from unpaid bills owed to suppliers.

Looking for guidance, the Metayers in 2011 turned to Green Mountain Economic Development Corp., the White River Junction nonprofit organized to foster small business growth in Windsor and Orange counties. Joan Goldstein, the former head of Green Mountain who is now the commissioner of economic development for Vermont, remembers a meeting was called early in the process at Wells River Savings Bank, which held the mortgage on the property, to figure out how to untangle all the encumbrances.

“There was a cast of thousands. The bankers, different vendors, Department of Environmental Conservation, Agriculture, the Metayers, the Galleranis, lawyers. They asked me the question: ‘Why don’t you take possession of the property and get the cleanup money and deed it back to Farm-Way?’ ” Goldstein said, pausing before adding, “I like complexity.”

Tainted History

There was more to the question than simply facilitating a project on behalf of a local business.

As a regional development corporation, Green Mountain would be able to tap into federal funds from the U.S. Environmental Protection Agency for the costly cleanup. After the remediation, Green Mountain could transfer the property to Farm-Way for its expansion.

The Metayers also reached out to Two Rivers Ottaquechee Regional Commission, which had a good track record in securing EPA funding to assess brownfield sites in Windsor and Orange counties. Two Rivers drew upon a portion of EPA money received in 2010 to hire KAS, the environmental consulting firm, to evaluate the site.

It wasn’t the first time the site had been investigated for contaminants. In fact, it had been known for years that prior operators had left toxic substances behind them.

The site was previously part of a larger parcel owned by the former Boston & Maine railroad. In 1990, Craig Trischman, owner of Twin States Fertilizer, bought a parcel from the railroad company and divided it into two parts. After selling less than an acre to Farm-Way, he kept the remainder for his business.

However, from 1960 to 1990 the Bradford Oil Co. had operated a bulk oil storage facility on the property, which was previously operated by Esso. As early as 1995, petroleum contamination was found in the soil and groundwater and had been the object of some remediation before more aggressive actions were taken in 2006.

Eventually, the state spent $260,000 from its petroleum cleanup fund to clean up the oil, according to John Schmeltzer, a hazardous site manager with the Vermont Department of Environmental Conservation.

Twin State filed for bankruptcy in 2008, two years after Trischman died. In 2009, a trespassing incident prompted the EPA to dispatch a team in hazmat suits to remove pesticides left in a garage at the site.

“We looked out the window one day and saw these guys in orange suits wandering around outside and it scared the hell out of us,” said Paul Gallerani, Farm-Way’s co-owner.

Since the contaminants were pesticides, which in Vermont is regulated by the Agency of Agriculture, Food and Markets, another state arm became involved.

“Our inspectors show up and the place was basically abandoned,” recalled Cary Giguere, pesticide section chief with the Agency of Agriculture. “We had (chemical company) Syngenta come in and they took everything that had their name on it. … Pesticides are dangerous and we didn’t want anyone coming in and harming themselves or the environment. So the EPA did a $250,000 cleanup on the site. When we left, we locked everything up.”

The emergency removal nonetheless left residual contaminants in the soil, which would require further action if the site were to be developed for business.

Then in May 2011, The Johnson Co., a Montpelier environmental firm, conducted a “Phase I” environmental assessment — a preliminary investigation that includes record reviews and interviews with owners, neighbors, occupants and local officials to learn the history of the site.

Eight months later, KAS was hired to conduct a “Phase II” study to identify on-site contaminants and formulate a “corrective action plan.”

GMEDC was ready to purchase the property in 2012 once an agreement could be hammered out among the estate, bank, creditors and town for settling the estate’s liens and back taxes. “Farm-Way is a great beacon in the community,” said Goldstein, the former GMEDC head. “So it was a no-brainer: Let’s figure out a way to make this work.”

The Liability Issue

One serious stumbling block, however, was liability. Under then-existing law, GMEDC could have found itself in the so-called “liability chain” as an owner of the property even if it wasn’t the cause of the contamination.

“You could have purchased a property that you never knew was contaminated, and still be liable to the state,” said Peter Van Oot, a Lebanon environmental lawyer and chairman of GMEDC, of the risks that attend brownfield projects.

To limit the liability of entities acquiring brownfield sites, the Vermont Legislature in 2007 had passed the Brownfields Reuse and Environmental Liability Limitation Act, or BRELLA.

The problem was that the law was designed for deep-pocketed developers who could afford the cost and time of environmental remediation. But the costs and risks would be too much for a small business like Farm-Way or nonprofit like GMEDC.

Solution: Design a “safe harbor” from the liability for nonprofits.

“Joan pointed out it would be very beneficial for a regional development commission to provide them a safe harbor so they could take control of the site and then pass it along to a responsible developer,” said state Rep. Jim Masland, a Democrat from Thetford who is a contractor and longtime GMEDC board member.

A committee of lawmakers and interested parties began crafting a bill that, by the time it was passed in 2013, also covered regional planning commissions and municipalities.

Among the conditions in the new liability exemption law is that the nonprofits cannot hold onto the property but must turn around and sell it to a developer. The liability exemption passes to future owners, with the state becoming responsible for any claims, according to Van Oot.

Ready for Expansion

GMEDC bought the property from the Twin State Fertilizer estate in January 2014 for $175,000.

“The Farm-Way folks contributed to an escrow fund, so we bought the property with the money they gave us, and then applied for a federal grant from the EPA to clean up the site,” explained Bob Haynes, who succeeded Goldstein as head of GMEDC when she became the state’s economic development chief in 2015.

GMEDC used $200,000 in EPA money to have KAS clean up the site. The project included demolition of an 8,000-square-foot fertilizer barn; the 3,500-square-foot garage had earlier been swept of contaminants but the walls would be recovered for use as a storage facility.

KAS sealed off the contamination by installing a membrane over the brownfield area and then laying a foot of clean soil on top of it.

The addition itself was further secured by the pouring of a concrete foundation and the installation of vapor depressurization system to deal with gases emitted by deteriorating organic compounds.

The project would also require sign-off from the Vermont Agency of Transportation for a permit to change traffic access at the store, an OK from the Vermont Division for Historic Preservation under Act 250, and the customary review of the Bradford Planning Commission.

When the Farm-Way project came before town officials for review, “it appeared all very complicated,” said Marcey Carver, chair of the Bradford Planning Commission, recalling the regulatory shoals the project had to navigate to win approval.

However, the Planning Commission role, Carver said, was confined to “the site plan, to make sure there was adequate lighting and following the setback that was required and that it didn’t impinge on the abutting mobile home park.” As it turned out, “there were no appeals at all, no issues with neighbors. From that standpoint it was smooth sailing,” Carver said.

The Planning Commission approved the site plan last September. Lajeunesse Construction of East Barre, Vt., broke ground on the project that fall and completed work earlier this summer.

In addition to the $1.5 million construction costs — financed by Woodsville Guaranty Savings Bank — Farm-Way had other out-of-pocket expenses, including $175,000 to buy the property; $85,000 to demolish the old fertilizer barn; $25,000 to clean and renovate the garage; and $65,000 for the back taxes. When the EPA grants are included, the total cost of the project exceeded $1.8 million.

Farm-Way also used the opportunity to undertake at its own expense an environmental cleanup of a former petroleum storage facility across the road that cost another $300,000.

“It was frustrating we couldn’t get assistance on that,” Carol Metayer said (the site is not part of any immediate development plan and therefore wasn’t included in Two Rivers’ assessment or Green Mountain’s cleanup proposal).

When Farm-Way opened it new shoe wing and warehouse at the end of July, more than 500 people attended the ribbon-cutting ceremony.

“There were so many people even I couldn’t get something to eat, and for that’s something for me,” said Gallerani.

Unkles, the Bradford Selectboard member who acknowledged the tortuous process that Farm-Way had to go through, averred that nonetheless “in the end everyone was very happy.”

Even the lawyers aren’t complaining.

“The law is doing exactly what we think it should do,” said Van Oot. “It’s one of those rare cases where Vermont passes a law and, hey, it actually works.”

Brownfield properties “all over the state” are standing idle that could be cleaned up and put back into use by involving regional development commissions and regional planning commissions, Goldstein said.

“That is the essence of economic development,” she said.

John Lippman can be reached at 603-727-3219 or jlippman@vnews.com.