IN WHOSE POCKET? ROCKETDYNE, STATE TRIED TO DISSOLVE OVERSIGHT PANEL.

Byline: Terri Hardy Sacramento Bureau Copyright 1999, Daily News of Los Angeles

Internal state Department of Health Services records show the agency cooperated with Rocketdyne company officials in an effort to get rid of an independent panel overseeing health concerns at the Santa Susana Field Laboratory in the Simi Hills, the Daily News has learned.

The evidence - e-mails and correspondence from DHS files - has led legislators and others to charge that state health officials and Rocketdyne plotted to overthrow the oversight panel and hand-pick a group of replacements that might help bring the 10-year investigation to a close.

``I was shocked but not surprised at the blatancy of it. I don't think we've even plumbed to the depths of the collusion between Rocketdyne and DHS,'' said Assemblywoman Sheila Kuehl, D-Encino.

``I can understand Rocketdyne acting in its own interests - it's inconvenient for them to have people homing in on their actions. But I think a department that has the name `health' in it would be on the side of keeping a community healthy, instead of being captured by an industry it works with,'' Kuehl said.

Officials at Rocketdyne and at the Department of Health Services strenuously disputed the allegations of improper conduct and insisted there is nothing inappropriate in their relationship.

``We absolutely deny any sort of collusion between Rocketdyne and the DHS at all,'' said Rocketdyne spokesman Dan Beck. ``We absolutely deny that we have too close of a relationship.''

Kuehl and others said the documents, recently obtained from official state records by an anti-nuclear activist group, show that new legislation or new administrative agreements - or both - are needed to strengthen the hand of the oversight committee by setting forth more clearly the panel's authority in relationship to the DHS.

``Gov. (Gray) Davis needs to fire all the state people on this project and start over again. It's clear that the state has bent over backwards to do Rocketdyne's bidding,'' said Richard Katz, a former assemblyman from the San Fernando Valley who, along with other lawmakers, in 1991 demanded the creation of the oversight panel.

Kuehl and others said the documents indicate that Rocketdyne and the state health department planned to oust members of the independent oversight panel, put a weaker panel in its place and wrestle away control of health investigations into whether pollution from the nuclear reactor and rocket fuel at the Field Laboratory posed health risks to workers and residents.

`Smoking gun'

``Those documents were the smoking gun,'' said Daniel Hirsch, co-chairman of the panel. ``Now I could see that Rocketdyne told DHS to kill off the panel - and DHS followed orders and tried to do it.''

The memos and e-mails - including a survey kept from the public that showed higher-than-normal incidences of lung cancer among Simi Valley residents near the lab - were recently unearthed from the health department's files under the Public Records Act by the Committee to Bridge the Gap.

Based on those documents, Kuehl and Katz have called for the ouster of the state's three top administrators overseeing health investigations at Rocketdyne.

Kuehl, who also has met with the governor and the newly appointed secretary of the state Health and Human Services Agency to discuss this issue, described both leaders as ``quite upset'' about the problems within the DHS, which operates under the HHSA.

One piece of new evidence is a December 1997 memo sent from a Rocketdyne consultant to the state Department of Health Services that proposes a new advisory panel of ``limited scope and time duration.''

Among key criteria for this group, the memo says, is the ability to ``form a constructive relationship with Rocketdyne,'' and it pushes for the state to take the lead in the health investigations.

Prepared by Rocketdyne consultant Susan Santos after conference calls with DHS officials, the document describes how Rocketdyne could assist the department in the process by recruiting new committee members through letters, meetings and advertising - and it also provided names and phone numbers of area residents Rocketdyne preferred for the panel.

Forming such a group would mean ``the state is least open to criticism from all parties,'' Santos wrote.

Also included in the documents were notes and a detailed time line written by DHS officials showing a step-by-step plan for creating a new advisory group, which outraged the existing oversight panel.

``Rocketdyne would like to replace us with people who are in their pocket,'' Hirsch said. ``This is the crucial fight for them. Rocketdyne faces massive liability.''

Work completed

Rocketdyne officials say they strongly believe the oversight group should be replaced.

``The existing advisory panel has completed its work - it's time to turn over the reins to one that has much more environmental expertise,'' said Steve Lafflam, Rocketdyne director of safety, health and environmental affairs. He also said the current group was ``not effective'' and biased.

Lafflam said Rocketdyne has concerns about whether two cancer studies issued by the University of California, Los Angeles, that found higher-than-normal rates of cancer in laboratory workers were ``good science.''

``Rocketdyne has been kept out of the process by the panel,'' Lafflam said. ``That's why we wrote the memo (on the panel change). We were working with the health department so we could keep good science in the process.''

Any new panel should include a representative from Rocketdyne, he added.

Lafflam said members of the panel were driven by special interests. Hirsch, for example, is a member of an anti-nuclear organization, and others are part of lawsuits against Rocketdyne, he said.

Raymond Neutra, chief of the DHS's Environmental and Occupational Disease Control division, said the oversight committee proposal, the time line and phone calls between the state and Rocketdyne were not sinister.

As a public agency, it is DHS's duty to talk to all groups involved in the health probe, Neutra said.

``Rocketdyne was not happy with the panel and was trying to influence the composition of the committee so they could work together in a less adversarial way. That was the extent of it. They were concerned, and we listened to them,'' he said.

Neutra, in a Dec. 18, 1998, letter to an Atlanta health official, discussed the need for a new panel.

The DHS would be willing to oversee a community health probe if it had ``a credible advisory committee including those members of the existing committee who wish to remain active,'' Neutra said in the memo.

Independent audit

Jim Stratten, deputy director for prevention services for the Department of Health Services, said an independent audit branch of the DHS launched a probe into the relationship between state and Rocketdyne officials when Kuehl recently called for the removal of the three top DHS administrators.

He hadn't been part of the investigation, but after participating in a conference call interview with Neutra and a Daily News reporter, Stratten said he would be asking his own questions.

``I would like to sit down and have direct conversations with staff about this,'' Stratten said.

The probe into the health department's relationship with Rocketdyne will accelerate as a result of the new information, several officials said.

At the heart of the fight over the oversight committee is the issue of who will decide on the crucial next step for the health investigations.

In written communications, Rocketdyne has long pushed for an ``exposure assessment'' that would look only at its reports of radiation and other pollution, and compare those to state and federal limits.

Community study?

However, members of the oversight group want to determine if a much more rigorous study of the entire community can be authorized to analyze what effect, if any, Rocketdyne's pollution has had on residents. Spreading the study out to the community is vital, panel members argue, because the federal Environmental Protection Agency in the past has found Rocketdyne monitoring unreliable, and studies have uncovered health harms among laboratory workers with exposures within legal limits.

Lafflam and Neutra said any decision on what kind of study to pursue should be made by a new panel with more environmental expertise.

Hirsch agreed that the panel could benefit by adding environmental scientists but was vehement that any such decision is up to the existing oversight committee - not Rocketdyne or the DHS.

The outcome of the committee's struggle for autonomy is crucial to people like Barbara Johnson, an oversight committee member who lives in the shadow of the laboratory. ``From the beginning, I wanted to believe that Rocketdyne hadn't caused any problems because I live here,'' she said.

``But over time, we've been told one thing from Rocketdyne and then found out something else was true. They would say no pollution got off site, and then we found out differently.

``The main thing we need to put to rest is the health issue. People need to know if the cancer they have is caused by pollution from Rocketdyne. They need to know if they should live in the area or move.''

Johnson is part of a class-action lawsuit against Rocketdyne. She said she has been given advice from her attorney not to comment on the suit.