Wichita Confronts Contamination Essay Example

the town’s economy by implementing substantial public improvement projects to spur additional private investment to the tune of $375M (Stillman, 2009, p. 145).

In August of 1990 it was reported by the Kansas Department of Health and Environment (KDHE), acting on behalf of the Environmental Protection Agency (EPA), that Wichita was on top of an underground lake contaminated by commercial and industrial chemicals that measured about four miles by one and a half miles. To make matters worse the aquifer was directly beneath the city’s central business district affecting 8,000 parcels of land valued at $86M. Initial estimates to clean the site were $20M and would take 20 years (p. 146).KDHE offered two recommendations: (i) the companies responsible for the contamination could work together and cleanup the area or (ii) the state would place the site for National Priority Listing and try to get the site eligible for Superfund (p. 146).

If the site were deemed a Superfund site, all 508 area businesses would be potentially liable for cleanup costs regardless of whether they had contributed to the contamination. In addition the recent US vs. Fleet Factors Corp. court case ruled that a lender may incur Superfund liability and in this case “financial institutions made ideal targets for Superfund cleanup cost recovery” (p. 46).In response Wichita bankers stopped all lending to the heart of the city further stalling the city’s economic activity and halting all development within the central business district.

Worse yet, the city’s residents were now unable to liquidate property due to the contamination and many elderly individuals were caught in the mix (p. 146). Affected properties generated more than $12M of the city’s

total $203M in property taxes and reduced valuations from the contamination and economic pressures would cripple the redevelopment plan and have a catastrophic impact on the town (p. 46-147).For comparison purposes, a similar but substantially smaller contamination issue was found three years earlier and it lowered property values 40%.

The businesses responsible formed a PRP group to investigate but couldn’t cooperate to resolve the problem and the site went onto the National Priorities List (p. 147). If the EPA were involved in the cleanup effort costs would likely increase up to 40% since they would hire an oversight contractor to ensure the work of the regular contractor was being performed appropriately.These incremental costs would possibly be borne by the businesses collectively responsible and the EPA could overcharge as necessary to punish noncomplying businesses (p. 147).

The legal ramifications of Superfund held innocent parties financially responsible and led to an incomprehensible number of civil suits in response – to illustrate one city with a $30M cleanup effort had approximately $700M in civil law suits and on average of the ten years taken to cleanup a site, the first seven were spent on administration and legal proceedings before the actual cleanup began (p. 48).The KDHE warned the city of Wichita that in January they needed to report to the EPA on the progress at the Gilbert-Mosley site and unless there was an active cleanup plan in place they would have no choice but to recommend that the EPA take over (p. 149). Wichita’s City Manager Chris Cherches ended up proposing a tax “decrement” plan where the city would devalue the affected properties but again immediately raise values

back to pre-contamination levels and use those tax funds to pay for the cleanup effort to restore the lost property values (p. 149).

AnalysisUpon reviewing the “Wichita Confronts Contamination” case it is readily apparent that federalism plays a role in how the events unfolded as they did. David Rosenbloom (2008) defines federalism as “the division of political authority between a central government and state or provincial governments” (p. 95). In short and in application to this case, federalism is simply the separation of powers between different levels of government – namely the city of Wichita, KDHE and the EPA. Rosenbloom (2008) goes on to state that different levels of government obtain their power through their respective higher level of government.

Hence Wichita is granted powers to act from the KDHE and the KDHE is acting on behalf of the EPA as discussed briefly in the case. The primary advantage of the federalist system in application to Wichita is that by giving local governments the ability to resolve their own problems before kicking it up to a higher level of government is that it essentially saved the town from a much less appealing future characterized by economic decay and commercial flight due to federal regulations such as the Superfund that would cost many innocent businesses dearly.Oddly enough the case is also a bit of a contradiction to federalism as it normally relates to a strong unified central government that responds to problems and not delegating authority as seen in Wichita – it’s more likely that intergovernmental relations played an important role in defining the case’s outcome. Intergovernmental relations is how different governmental levels/units (as defined in the

previous paragraph) interact and work together to execute processes and accomplish goals.

Intergovernmental relations is about the complex sharing of powers between different governmental entities. This sharing of power was in the effort to provide effective and efficient administrative services but can include policy, financial and administrative dimensions (Stillman, 2009). A key point of intergovernmental relations as it applies to this case is that Cherches throughout the cleanup process always aligned mutual incentives to keep each level of government in check and create win-win solutions for all parties involved.Had Cherches not done this there likely would’ve been more rifts and conflicts with other governmental organizations but Cherches’ actions ensured that the city of Wichita was making efforts to make the lives of the KDHE and the EPA easier through the city’s innovative solution. By having Wichita assume some responsibility it allows these different governmental entities to share power accordingly and create a solution that was truly for the betterment of the city instead of crushing it economically for decades.

This same example also helps to illustrate the concept of political bargaining.Political bargaining is the process of negotiation between politicians, governmental units, etc. in order to find win-win solutions for all parties involved. This give and take process has been displayed by Cherches as he negotiated his tax “decrement” plan and also when dealing with the KDHE and EPA in order to keep them out of Wichita throughout the cleanup process and prevent Superfund from crippling the local economy.

Granted Cherches had nothing to lose given his situation which made the negotiation process a bit easier since any outcome was better than what he was expecting albeit

much more dire.Given that over 500 businesses were involved at Gilbert-Mosley it seems highly unlikely that they would be able to collectively reach an agreement with regards to liability. It’s important to keep in mind that there is little incentive for the businesses to come to a timely solution since the longer they can drag out the process the longer they wouldn’t have to pay for the cleanup and also the more likely that the responsibility would get diffused across other businesses thereby lessening their financial costs.As a result bargaining was also demonstrated by these businesses behind the scenes as they were responding to their own sets of incentives. Interdependency is another concept that cannot be overlooked as influential factors leading to Wichita’s success.

Interdependency is essentially the complex collaborative relationships between different parties and how they rely on one another.Flowing logically from political bargaining, Cherches’ actions to enlist lenders as allies illustrates the interdependent relationship of Wichita and these businesses since the fate of their investments were intertwined with the fate of Wichita while the city needed the financing for their redevelopment plan of their central business district. Since the banks risked losing the value of all their Gilbert-Mosley investments in addition to the liability of any cleanup costs, they were logical allies given the incentives for the cleanup to succeed and avoid the Superfund litigation process.