BEFORE THE KANSAS DEPARTMENT OF HEALTH AND ENVIRONMENT

Charles Curtis Building

1000 SW Jackson Suite 560

Topeka, Kansas  66612-1368

IN THE MATTER OF                                             )                       CONSENT ORDER

                                                                                    )                       Case No. 10-E-94 BER

POLLUTION AT FORMER FARMLAND         )

INDUSTRIES, INC. NITROGEN                         )

MANUFACTURING PLANT                               )

LAWRENCE, KANSAS                                         )

FIRST AMENDMENT TO CONSENT ORDER

            Pursuant to Paragraph XX.2. of the Consent Order dated June 28, 2010, in Case No. 10-E-94 BER (“the Consent Order”), the parties thereto, the Kansas Department of Health and Environment (“KDHE”), and the City of Lawrence, Kansas (“Respondent”) mutually agree to amend the Consent Order as follows:

            1.         Paragraph IV.C.17 of the Consent Order is amended to read as follows:

Annual Budget Summary Report: Respondent shall provide an Annual Budget Summary Report to KDHE within thirty (30) days after the end of each calendar year or as otherwise agreed by KDHE.  Said Annual Budget Summary Report shall document past expenditures and project future expenditures of Remediation Trust Funds for activities required pursuant to this CO. 

            2.         Paragraph VI.e. of the Consent Order is amended to read as follows:

e.         To the extent that Respondent is using Remediation Trust Funds as financial assurance under this CO, document all expenditures from the Remediation Trust Funds and income earned during the last quarter, including an updated summary of total expenditures, total funding remaining, income earned and projected quarterly expenditures and activities.   

            3.         Paragraph XV.1. of the Consent Order is amended to read as follows:

1.         In order to ensure the full and final completion of the activities contemplated herein (“Work”), the parties acknowledge Respondent timely established, and shall maintain, financial security to complete the obligations of Respondent as set forth in  the Consent Order for the Site.  Respondent will use a combination of financial security with remainder of the Remediation Trust Funds that Respondent placed in an Escrow Account in accordance with requirements of the Paragraph XV1.(d), and another financial assurance mechanism subject to approval of KDHE.  Respondent intends to continue to provide the remainder of the financial assurance provided by the ad valorem taxing authority of the Respondent and KAR 28-29-2112, as allowed under subparagraph 1(f) of Paragraph XV, subject to such demonstration as KDHE may require under that regulation.  Such financial security shall be provided by Respondent in one or more of the following forms, which must be satisfactory in form and substance to KDHE:

a.         A surety bond, unconditionally guaranteeing payment and/or performance of the Work that is issued by a surety company among those listed as acceptable sureties on Federal bonds as set forth in Circular 570 of the U.S. Department of the Treasury;

b.         One or more irrevocable letters of credit, payable to or at the direction of KDHE, that is issued by one or more financial institution(s) (i) that has the authority to issue letters of credit and (ii) whose letter-of-credit operations are regulated and examined by a U.S. federal agency, or agency of the State of Kansas;

c.         A trust fund, established for the benefit of KDHE into which the Remediation Trust Funds, including funding from both Remedial and Administrative Accounts that Respondent receives through the Acquisition Agreement, shall be placed by Respondent to be used for activities performed pursuant to this CO.  Such trust fund shall be administered by a trustee that has the authority to act as a trustee and whose trust operations are regulated and examined by a U.S. Federal agency, or an agency of the State of Kansas;

d.         An identified separate escrow account into which the Remediation Trust Funds, including funding from both Remedial and Administrative Accounts that Respondent received through the Acquisition Agreement, shall be placed by the Respondent to be used for activities performed pursuant to this CO and/or for activities performed to benefit the Site and which account will be available for use by KDHE in the event of any Work Takeover under Paragraph 9 of Section IV C of this CO;

e.         A demonstration by the Respondent satisfactory to KDHE that it meets the financial test criteria of 40 CFR § 264.143(f) with respect to the Estimated Cost of the Work, provided that all other requirements of 40 CFR § 264.143(f) are met;

f.          Other financial mechanism(s) consistent with state and federal laws and currently included as financial assurance in other state environmental programs, including but not limited to KAR 28-29-2111 through 2113; or

g.         A combination of the above.

All remaining provisions of the Consent Order not specifically modified herein remain in full force and effect. 

IN WITNESS WHEREOF, the parties have affixed their signatures below:

RESPONDENT:

            Date:

By: 

Title:  Mayor

STATE OF KANSAS:

            Date:

Robert Moser, M.D., Secretary

Kansas Department of Health & Environment

CERTIFICATE OF MAILING

            I hereby certify that on this  day of , 2014, a true and correct copy of the above and foregoing First Amendment to Consent Order was deposited in the United States Mail, postage prepaid, and addressed to:

            City Manager

            City of Lawrence

            P.O. Box 708

            Lawrence, Kansas  66044

                                                                                    KDHE Staff Member