San Gabriel Valley struggles with toxic cleanup woes.

Cleaning up decades of pollution proves problematic

Imagine Uncle Sam informing your company it owes a huge environmental clean-up bill, but won't disclose how much it will be, when it will be due or when the work will be wrapped up.

Now imagine yourself in Bill Peters' shoes.

For nearly a decade, Peters' firm, El Monte-based Trail Chemical Corp., has been one of dozens of San Gabriel Valley companies targeted to pay for the decontamination of the area's fouled groundwater. So filthy is the water that the federal government 12 years ago put it on the national Superfund list, the registry of America's worst pollution spots.

Yet after countless rounds of debate and study, no settlement has been hammered out and the amount each industrial outfit will ultimately be required to pay remains unclear.

"We made statements we didn't use the chlorinated compounds the Environmental Protection Agency was finding, but they said, 'Guilty; you've handled chemicals, and you must spend money to prove you didn't do it,'" said Peters. "It was an impossible situation."

For Trail Chemical -- a 22-worker operation that makes industrial coatings and generates roughly $2 million in yearly sales -- the consequences have produced more than a few migraines. Like other affected business owners, Peters said his business has suffered financing troubles and quashed expansion plans because of the looming Superfund bill.

Though no one knows for sure what the total price tag will ultimately come to, it could cost as much $300 million to $400 million to purge the groundwater of dangerous contaminants regionwide. Unless a new approach is found, the EPA will hand down a "regulated decision." Under such a decision, the EPA mandates a specific dollar amount that must be paid to clean up contamination, but leaves it up to the liable parties to decide among themselves how much each party will pay. In many such cases, regulated decisions trigger a raft of lawsuits, as liable parties sue each other over their respective clean-up responsibilities.

However, there is some hope that harnessing the power of the marketplace may accelerate the clean-up without cleaning out the scores of small concerns unable to afford hefty EPA payments.

Creative assistance

In El Monte, for instance, the city is crafting a redevelopment plan to aid the electronic, chemical and manufacturing firms targeted by the federal government. The idea is to generate new tax increments, possibly by helping the companies expand or secure favorable equipment loans, so higher property taxes could help finance a city-run water treatment plant. That plant, in turn, would then be used to help purify the polluted groundwater, thereby shrinking each company's clean-up costs.

"We have these solid-gold companies paying (workers) $15 per hour, and what happens if we lose these?" said El Monte City Attorney Dave Gondek.

In nearby Baldwin Park, where the groundwater contamination is so heavy that clean-up expenses are estimated at between $100 million and $150 million, another concept is being floated.

Spearheaded by the San Gabriel Basin Water Quality Authority, the plan is to construct a treatment plant to purify roughly 30,000 acre feet of groundwater a year, enough to quench the needs of 175,000 people annually. Once purged of toxins, the water would be sold to local agencies through the giant Metropolitan Water District. It would be priced at $412 per acre foot, roughly $200 per acre foot less than it costs to treat and deliver, with the targeted companies making up the difference.

That would reduce the Superfund businesses' bill to regulators by a whopping $50 million, while providing MWD with a new source of water in case of renewed drought. Should that win government approvals, secondary agreements would be inked to prevent companies from getting sued or suing others to recover costs -- a chronic problem in Superfund settlements.

Superfund squabbles

Though lambasted as unfair, Superfund law holds that both polluters and entities that reside nearby or transport contaminated material can be named "potentially responsible parties" by the EPA. Frequently, major corporations are named potentially responsible parties first, and they react by using smaller companies to share in the bill.

Chris Bateman, vice president of Rosemead-based Hermetic Seal, is among those who have lived with that threat for years. His company, which makes connectors used by aerospace and automotive contractors, is pinning its hopes on El Monte's redevelopment plan, especially after a Superfund reform bill died in Congress.

"It's the worst kind of problem to be grappling with because you can't know the answer," said Bateman.

Meantime, some believe that just having the threat of endless groundwater lawsuits has scared off millions of dollars in San Gabriel Valley land investment, even a Coca Cola Co. bottling plant in Irwindale. That's the gridlock the San Gabriel Basin Water Quality Authority wants to break.

"Entrepreneurial solutions are far cheaper than regulated solutions, and that's been proven a dozen times across the country," said Jim Goodrich, the authority's executive director.

Expansive problem

The dirty groundwater has tainted parts of a 167-square-mile underground aquifer supplying water to residents from La Verne in the eastern valley to Alhambra. The contaminated plume rests mainly under Irwindale, Baldwin Park, El Monte, Industry and Azusa, and officials believe that about 30 percent of the aquifer's water contains dangerous volatile organic compounds that have been seeping into the water table since the 1940s.

Thousands of sources -- including defense contractors, trucking companies, landfill operators, septic tank owners, laundries, farmers and small manufacturers -- are responsible, informed sources said. However, pinning down who is responsible for what over the last 50 years could take years, squelching new investment and delaying the decontamination effort.

EPA officials said they are interested in the local market proposals, but insisted they need more time to study the details. For Peters and other executives, the EPA's blessing couldn't come too soon.