Federal, state and Kenosha officials on Thursday will announce an agreement to prepare the former Chrysler Kenosha engine plant site for redevelopment.
The plant closed a year ago. Selected assets of Chrysler were acquired in 2009 by Italy-based Fiat SpA, after Chrysler entered Chapter 11 bankruptcy. But Fiat did not acquire the Kenosha plant.
The plant, which sits on a 109-acre site in the middle of the city of Kenosha, is owned by Old Carco Liquidation Trust, which was created during the Chryslter bankruptcy process to dispose of several Chryslser properties and then wind down.
Under the agreement between Old Carco, a consortium of lien holders led by JP Morgan Chase, federal, state and city officials, the company will sell the equipment at the plant and then will be responsible for demolishing the plant, said Kenosha city administrator Frank Pacetti. Only concrete slabs will be left in place.
Then Old Carco will abandon the property and it will be turned over to the city of Kenosha. Under the agreement, the city will not be responsible for contamination at the site, Pacetti. "We know there is (contamination there)," he said. "It was an industrial auto plant for over 100 years."
The federal government will provide $10 million to pay for removal of contamination from the site, Pacetti said.
Once cleanup is complete the city will work with planning experts and residents to create an urban redevelopment plan for the site, which is located in the middle of a residential area. It is too early to say what the redevelopment plan will include, Pacetti said.
The city plans to get take ownership of the property in about 18 months, but it will take several years before development occurs there, Pacetti said.
"At least we now have a path forward," he said. "Without the cooperation of our friends in the federal government, the EPA, the (U.S.) Department of Justice, (the U.S. Department of) Treasury, our friends in state government, the (state) Department of Justice and the DNR, this would never have been possible."