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LIVINGSTON - Burlington Northern Santa Fe Railroad is planning to buy most of a small neighborhood on the city's north side, an area that overlies a plume of contaminated groundwater that has spurred several lawsuits.

"It's pretty much the whole neighborhood," said John Bauer, who lives on North L Street, right beside the railroad property.

He said BNSF officials had told him the properties are likely to be bulldozed.

"I think they're going to raze them," Bauer said.

BNSF spokesman Gus Melonas refused to give any details beyond a prepared statement: "Part of our approach in remediating the Livingston site beyond the rail yard includes exploring properties for possible future purchase to enable BNSF to effectively manage this ongoing environmental process."

BNSF pulled out of Livingston in 1986, sold its mammoth shops here and leased its rail line to Montana Rail Link, which uses the tracks today.

However, the company is still responsible for the big pollution problem it left behind. Park County, at least two individuals and three private companies have sued the railroad over pollution issues over the past 15 years.

Purchasing the neighbors' property could make cleanup easier, plus avoid potential legal troubles down the road.

"Your plume isn't moving off site if you buy all the properties around you," Jarrett Keck, project manager for the Department of Environmental Quality, said this week.

Melonas declined to say how many properties will be purchased or what the railroad plans to do with them.

However, Bauer and two local realtors said railroad officials have been approaching neighborhood residents with offers to purchase their property.

The railroad has been offering 115 percent of appraised value, if the owner sells immediately.

If the owner wants to stay on his or her land, they can accept a fee and grant BNSF a right of first refusal. The company will then pay appraised value when the owner is ready to sell.

"It's win-win for me," said Bauer, who operates an automobile repair shop on his property. He also owns a rental house he has agreed to sell to the railroad.

The purchase price could allow him to pay off his mortgage on his home and shop, then continue to operate his business until he is ready to retire, he said.

So far, he said, BNSF officials have been easy to work with.

The neighborhood the railroad is looking at is just east of the railroad shops and south of Gallatin Street. It includes about 10 homes and a similar number of trailers, plus a handful of industrial businesses, such as a brickyard and a cement plant.

The railroad's pollution problem in the area is twofold.

One plume of diesel fuel floating on the groundwater resulted from decades of spills and dumping by BNSF and its corporate ancestors. That plume extends east of the railroad shops and is less than an inch thick in most places, although it expands to a few inches thick in some places, according to a 2002 water quality monitoring report.

A second plume consists of volatile organic compounds, some of which have been listed by the Environmental Protection Agency as likely causes of cancer.

Both plumes extend off of railroad property, complicating BNSF's legal situation.

In 2001, the owners of C&P Packing, a slaughterhouse on neighboring property, sued BNSF, alleging it had rendered C&P's property too polluted to use. The railroad bought the property and the packing plant shut down.

Two other companies near the railyards have sued since then - Hallett Minerals and Ruggles Excavation.

"We're seeing high concentrations of solvents on both properties," said Dave Erickson, an engineer from Butte who tested waters on them.

DEQ's Keck said he is not aware of any recent changes in the pollution or new discoveries; both plumes have been decreasing over time.

A final round of tests are scheduled for this month to measure the air in people's homes for traces of chemicals that could be leaching up from the ground.

The pollution was discovered in the 1980s, when several barrels of BNSF waste were found in the Park County landfill. Those hazardous substances were removed, but a subsequent investigation turned up the dirty groundwater.

Park County later sued BNSF and won a $14.7 million judgment for the dumping in the landfill.

About 90 percent of the diesel plume has been removed, partly by mechanical means and partly by natural degeneration, according to the 2002 report. The solvent plume also is growing less virulent in most areas, Keck said.

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