$2 MILLION IN FINES, FEES FIRM HIT FOR PREDECESSOR'S ILLEGAL ACTS.

Byline: Lisa Mascaro Staff Writer

NEWHALL - After just one visit to the former Special Devices Inc. facility, the state toxic department scientist saw what became the basis for investigation.

Remnants from the manufacture of the pea-size devices used to detonate car air bags were being burned without permits, he said - with emissions going into the air and ashes settling into the ground.

And most importantly, said hazardous material scientist Larry Stuck, ``there was definite potential somebody could have gotten hurt.''

More than a year after that August 1999 investigation began, SDI agreed to a $500,000 civil settlement with the state.

The company also pleaded guilty to three federal felony violations of hazardous waste handling and was fined $1.5 million and sentenced to three years' probation.

``This was a big case for us,'' said Jeanne Garcia, a spokeswoman for the Department of Toxic Substances Control. ``The settlement is large for us.''

DTSC is expected to begin a study of the site where hazardous wastes were handled.

A company spokesman said the new owners had no idea of the violations that had been a part of the firm they took over just months before the investigation began.

``They didn't realize there were any environmental problems at all. As soon as they found out about it, they were determined to clear it up, and they did,'' said SDI spokesman Allan Mayer.

The company, since relocated to Moorpark, hopes to put its record behind it and run its business according to the permits and regulations required.

``The company certainly owned up to it,'' Mayer said. ``They've been very eager since they discovered all these previous problems to get them settled and move on.''

As part of its settlement with the state, SDI must write a paper that could serve as a how-to guide for companies getting into the hazardous waste handling business.

Also as part of the settlement, the company will not be liable for future penalties at the Newhall site, but would be responsible for future cleanup if the property owner fails to do so.

In business for 40 years, SDI is most known as the company that makes the igniters for automobile car air bags.

The company started in the air bag business in 1989, making devices used in most American car models after decades of work for aerospace, including the devices used in ejector seats for fighter pilots.

But a key ingredient in operations, zirconium potassium perchlorate - a chemical used in tiny amounts to spur the devices - is highly volatile.

In 1999, one worker was killed while loading a pickup with two-pound canisters of the chemical at the Newhall facility, and two employees were injured. Last year, two workers were injured, one critically, when they were loading the chemical into a machine at the Moorpark facility.

State officials said their investigation showed years of unpermitted burning, at least since 1995, at the company's Placerita Canyon facility.

The company would burn off leftover air bag devices and papers contaminated with the zirconium potassium perchlorate - first in an open tunnel, later in a steel one.

``Thousands of pounds burned up there over the years,'' said Stuck.

The August investigation came shortly after an explosion at the facility when workers burned off waste that had been in storage, possibly for years, Stuck said.

Stuck said the company was in the process of moving to Moorpark, and while cleaning out its facilities, it found additional waste in igloo- shaped storage structures.

``They were burning every day trying to keep up with the waste they were generating. Some of that got left in these igloos. Out of sight, out of mind,'' he said.

After Stuck's tour that day and follow-up interviews, the state filed a civil case for violations of hazardous waste handling.

The company faced several hazardous waste violations - improper labeling, storage and treatment - stemming from not having permits to handle explosive wastes.

``They made some kind of attempt to get a permit, but didn't go through the proper channels,'' Stuck said. ``There's not many places that burn this kind of waste stream. It's hard to know if it's permittible.''

Without permits, there was no oversight of operations or disposal - regulators didn't know hazardous waste was being burned at the facility, Stuck said.

``When we issue permits, we make sure they have safeguard to protect the employee,'' Stuck said. ``We have no oversight.''

The federal suit stemmed from that investigation.

``This is a significant violation, and the burning of these hazardous wastes presents serious potential danger and risk to safety and to the people handling (it),'' said Assistant U.S. Attorney Steven Arkow.

Arkow said there is an ongoing investigation of individuals.

DTSC is scheduled to prepare a study of the area this year, as part of the settlement.

Company officials say they are optimistic that, under new ownership, the past violations are behind them.

Mayer said the company wanted to reach a settlement. Of its federal fine, $1 million will go toward environmental programs in the National Park Service - including those in the Santa Monica Mountains National Recreation Area, Channel Islands National Park, Joshua Tree National Park, Mojave National Preserve.

Mayer said the new owners, a private unnamed investor group that bought what had been a publicly traded company, see promise in the company with annual revenues of $170 million - an old-fashioned investment in an era of failed dot-coms.

Mayer said the new investors ``felt there was great potential in this company that wasn't being exploited. They were determined to run it in a more effective way.''

He said, ``They're very careful to stay within the letter and the spirit of the law.''

DTSC said they will be certain as well that regulations are being followed.

``We are going to keep an eye on them,'' Stuck said.