Responding to the Freedom Industries chemical spill
If you or your business were harmed by, or you incurred damages from, the Freedom Industries disaster in January 2014, there is a new opportunity you should consider for recovering your losses. Here is a link to the Charleston Gazette story from this past week.
Federal prosecutor Booth Goodwin has created a Web site for victims of the indicted officials of Freedom Industries. All victims of federal crimes have rights, created by federal law, in federal criminal cases. As listed in the Gazette story, these rights include:
Unlike the federal bankruptcy case involving only the empty carcass of the Freedom Industries corporation, the federal criminal case involves the human beings who made the decisions that created the disaster.
You can register your victim claim using this form, provided on Goodwin’s Web site. The form specifically asks you for any damages you have incurred as a result of the crimes committed:
You are not automatically entitled to recovery of your damages, because it will be up to the judge in the case to award restitution. But you will never have a chance for recovery unless you tell the judge what the criminals owe you. Note that you also have a right to speak at any public hearing on plea deals or sentencing of the criminals involved.
On Tuesday, WV American Water filed its “notice of intent to file a general rate case.” Under Public Service Commission rules, the company has 30 days until it has to file more information, including the amount of the rate increase and the supporting financial documentation. The PSC then has 300 days to decide how much of a rate increase it will allow – so a decision should be expected sometime in the first quarter of 2016.
The Charleston Daily Mail provided a little bit more information, including that WV American Water has spent $105 million in capital expenditures since 2012 that it wants to put into rates and that the losses incurred during the Freedom spill “could be included.”
As we know, WV American Water was completely unprepared for a chemical spill. It had even removed chemical testing and monitoring equipment from its Kanawha Valley plant about ten years ago to cut costs. Effectively, WV American Water was betting that a spill would never occur. That business strategy created a risk that should be borne by shareholders of its parent company, American Water Works — not its customers.
Though WV American Water hasn’t said so publicly yet, their proposed rate increase may well also include a request to increase the company’s return on equity (profit). WV American Water has consistently been earning only 4-5% per year – dragging down the overall return of its parent company American Water Works, which has averaged a 8-9% return for the past couple years.
On Tuesday evening, Freedom Industries and the DEP held a public meeting to discuss the remediation of the Freedom Industries site. But there didn’t seem to be too much real information to share. Freedom appears to be trying to minimize the cost of the cleanup because there is not enough money in Freedom’s bankruptcy estate to meet DEP Secretary Huffman’s earlier requirement that there should be no detectable MCHM left at the site. DEP gave Freedom permission to enter the DEP’s “voluntary remediation” program, which Freedom was desperate to do in order to avoid having to remove MCHM down to “non-detect” levels. Now Freedom must remediate the site according to a “risk-based” approach, which has never been defined. It’s not really clear what “risk-based” would mean in a context where the long-term health risks of the chemical are unknown.
Freedom and DEP have until the end of this month to agree on a plan for the cleanup of the site, unless they agree on an extension. One plan discussed at the public meeting was the idea of putting a cap over the soil so that rainwater runoff will not wash MCHM into the Elk River. DEP and Freedom officials did not provide any information about sub-surface movement of water through the site, so we have no assurance that a surface cap will really control migration of MCHM from the site.
When DEP and Freedom do come up with their plan, they should provide the public with real answers to questions like:
And, speaking of transparency, it would also be good to know at what level WV American Water’s new chemical monitoring equipment, due to be installed by the end of this month, can actually detect the various chemical constituents of MCHM.
Even after all that happened in January 2014, it is stunning to see that the officials at Freedom and the DEP still don’t seem to be taking seriously the fact that the former Freedom tank site lies 1.5 miles upstream from the only water intake for the only water treatment plant for 300,000 people.
On Tuesday, March 24th from 5-7pm at the Charleston Civic Center, consultants from Freedom Industries and the Department of Environmental Protection will host a public meeting about the remediation of the Elk River site.
Though the tanks have been removed from the site, the ground is, of course, still contaminated with MCHM and the other chemicals that leaked from the tank.
Last week, Freedom Industries was accepted into the DEP’s voluntary remediation program, which requires “risk-based remediation”, whatever that means, as opposed to the more expensive alternative of full removal of MCHM from the site. According to the Gazette, Freedom’s chief restructuring officer, Mark Welch, hopes that “there is little remediation left to do, other than put a cap over the site and establish some sort of environmental monitoring program.” The DEP, meanwhile, has repeatedly stated that it will not accept any plan that does not eliminate the risk of MCHM contaminating the Elk River.
Under the requirements of the voluntary remediation program, Freedom and DEP have until March 30th to agree on a timeline for sampling, risk assessment, and development of a workplan for the site – unless both parties agree on an extension. No such agreement has yet been reached.
Freedom’s chief restructuring officer told the Gazette’s Ken Ward that, at the meeting, Freedom will provide “further assurances on remediation, soil removal and chemical analysis.” Yet the DEP spokeswoman said, “[w]e can’t give any specifics about the plan for Freedom, though, because there isn’t one yet.”
Should be an interesting meeting.
Everyone said that having the water crisis happen during the legislative session last year was a great thing. I disagree.
The timing of the water crisis meant that public attention focused immediately on the legislature with the expectation that legislators would “fix” the problem. There was less discussion of the longer-term causes of the crisis, particularly the failure of existing regulations – a problem that has persisted in this state for many decades. Instead, the prominence of the legislative response meant that the dominant narrative was based on the idea that the problem could be fixed quickly through legislation.
Let’s take a step back and remind ourselves of the factors that contributed to this crisis. They include:
1. Lack of regulation of aboveground storage tanks
2. Weak enforcement of existing regulations, including the Clean Water Act and Safe Drinking Water Act.
3. An unsafe water system controlled by a holding company that is not interested in investing in West Virginia infrastructure
4. Lack of federal regulation of tens of thousands of chemicals that were grandfathered into the Toxic Substances Control Act
While passage of Senate Bill 423 is a step backwards as regards regulation of tanks, it has nothing to do with any of these other issues that were exposed during the water crisis. And, in fact, slow progress is being made on some other fronts. The Freedom Industries executives have been indicted. And public pressure pushed the Public Service Commission into opening an investigation into WV American Water; Advocates for a Safe Water System is continuing to build pressure on WV American Water to fix its system.
The legislature has proven that they are not going to be much help to us in fixing the problems that led to the water crisis. But there is still plenty to do.
On Saturday, the legislature passed Senate Bill 423. This bill weakened the Aboveground Storage Tank Act passed a year ago – reducing the number of regulated tanks from nearly 50,000 to 12,000; reducing the frequency of inspections; and allowing even more tanks to be exempted if they show compliance with existing DEP permits.
This rollback cannot be blamed solely on the Republican takeover during the November election; corporate influence at the legislature cuts across party lines. The former democratic Speaker of the House, Tim Miley, led the charge to rollback the Aboveground Storage Tank Act on behalf of the natural gas industry last summer. Industry knew last year that fighting the tank bill during the water crisis would have been much more difficult than waiting for public attention to dissipate and then gutting the bill later – as they did.
Almost regardless of the actual content of the bill, the symbolism of the Legislature rolling back the Aboveground Storage Tank Act – widely seen as *the* state’s response to the water crisis – really doesn’t look good. It signals that the legislature is not serious about addressing the underlying problem of under-regulation that led to the Freedom Industries leak in the first place.
In order to recover from last year’s water crisis, Charleston needs to use the crisis as an opportunity to transform the image of the city – from one that had its water supply poisoned to one that implemented changes to have some of the safest water in the country. That is the only way to regain the trust of the public and local businesses for the long haul. The city has not yet taken the initiative to do this. And the legislature is certainly not helping.
After the House Judiciary Committee passed Senate Bill 423 in a 13-12 vote last night, the bill now moves to the House floor for a vote.
The WV Safe Water Roundtable is encouraging people to write to Speaker of the House Tim Armstead (R-Kanawha) to urge him to kill the bill. Armstead can be reached at firstname.lastname@example.org; 304-340-3210. His office at the capitol is Room 228-M. You can also find and contact your delegate here.
Good news and bad news from the legislature yesterday. The good news is that the proposal to reclassify the Kanawha River as a drinking water source was passed by the Senate Judiciary Committee without any harmful amendments.
The bad news is that the House Judiciary Committee narrowly passed Senate Bill 423, the bill to gut the Aboveground Storage Tank Act. The bill was passed without amendment, although one amendment – which would have increased the frequency of tank inspections and tightened the standards by which tanks could be exempted from the Act – was offered and narrowly defeated. The Gazette has more details about the bill here.
Here is the final vote count, 13 to 12, which breaks down neatly along lines of party and geography:
Against Senate Bill 423:
For Senate Bill 423:
Senate Bill 423 will now advance to the House floor.
One thing is clear — it wouldn’t have taken much for this vote to go the other way. Conspicuously absent was the voice of Mike Manypenny (former Democratic delegate and House Judiciary Committee member from the 49th district), voted out last November in favor of Republican Amy Summers, who voted to rollback the tank bill.
There will be a public hearing this Friday, March 6th at 8:30am in the House of Delegates Chamber on Senate Bill 423 – the bill to roll back last year’s Aboveground Storage Tank Act. As I posted last week, Senate Bill 423 has been amended since it was originally introduced. The amended bill still significantly weakens the Aboveground Storage Tank Act passed in response to the water crisis.
Last year, we were able to pass strong legislation because of the action of hundreds of people who sent emails, made phone calls, and showed up at the legislature. Come out on Friday to tell the legislature not to roll back the progress made last year.
Anyone can sign up to speak at the hearing. Here are some tips:
And here are some suggested talking points:
Earlier this week, the Senate Judiciary Committee passed an amended version of Senate Bill 423. We posted about SB 423 before - the original version would have completely gutted last year’s Aboveground Storage Tank Act, eliminating tens of thousands of tanks (including the Freedom Industries tanks!) from the regulations.
The amended version of Senate Bill 423 is not as destructive as the original bill, but is still less comprehensive than the original Aboveground Storage Tank Act. The amended version:
This amended bill is expected to pass out of the Senate this week and then be taken up in the House Judiciary Committee.