Table of Contents
Governments Undercut Publics Right to Compensation for PCB Damage
Problems with the SettlementAlabama Settlement also Shortchanges the Public
Background
Economic Damages Not Included
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For more information about PCBs visit www.FoxRiverWatch.com
Governments Undercut Publics Right to Compensation for PCB Damage
A bad compromise on top of compromise
Secret meetings between Georgia-Pacific Corporation (formerly Fort James Corporation) and state, tribal and federal officials resulted in a badly compromised settlement as compensation for G-Ps share of PCB contamination of the Fox River and Green Bay.
G-P agreed to pay only $14.5 million as compensation and was allowed to choose projects it wanted to fund. G-P also would pay the governments $1.6 million as partial reimbursement of assessment costs and management of the 56/57 sediment dredging demonstration.
If settlements with the rest of the companies follow this example, the TOTAL compensation will be only $65.9 million. Well be left with only a token effort for one of the worst toxic cases in the country.
The publics interest is NOT being served.
1. It meets only 20% of G-Ps minimum responsibility We were told last year by U.S. Fish and Wildlife Service in its Assessment to expect total compensation of $333 million if sediment clean up will take more than 40 years to achieve its goals, which it will under DNRs proposal (in fact the damages will continue more than 100 years into the future). According to a DNR study, Georgia-Pacifics share of responsibility is approximately 22% of this total, or $73 million. If justice is to be served and minimum compensation granted, G-P needs to provide the $73 million.Background
Keep in mind the original $333 million was an extremely conservative estimate, a major political compromise from a higher calculated value closer to $600 million, and even that number did NOT include many major types of economic damages. (See page 6.) The TRUE damages are likely to be well over $1 billion.
At the 5 public hearings held in Green Bay, Appleton, Oshkosh, Sturgeon Bay and Escanaba, citizens repeatedly said they felt the $333 million was too low, but the U.S. Fish & Wildlife Service said they wanted to be sure they had a rock solid number they could easily defend in court without question.
It was obvious they considered $333 million as the bare minimum, not as a high starting point to be negotiated downward.2. Settlements in the Dark How can citizens evaluate the fairness of this individual settlement, without knowing what the final overall plan says? (The formal Restoration Plan for all the mills may be released in just a few weeks, but AFTER this comment period ends.) Were opposed to this premature piece-meal approach. What good is a comment period, if we arent being given key information?
3. What is G-Ps Formal Allocation? The percentage of responsibility allocated to G-P could tell us more about the overall size of the Restoration Plan, but the agencies refuse to tell us their final calculation. Were forced to assume G-Ps share is 22% based on an older DNR study.
4. Wrong types of projects A major share, 27%, of the G-P settlement ($3.9 million) is for human park and recreation enhancements, which were heavily criticized a year ago. In recent years, the U.S. Fish and Wildlife Service conducted numerous public opinion surveys (at high cost) and learned that the public placed highest priority on projects designed to stop toxicity. Second priority was to protect and enhance fisheries and wildlife habitat. Third priority were projects to stop land run-off pollution (non-point pollution). A distant fourth were enhancements for human recreation, such as boat ramps, docks, parking lots and trails. Most Northeast Wisconsin and Upper Peninsula Michigan residents believe we already have a lot of these human amenities, but the waterways and wildlife deserve more attention. Now, it seems the federal government has abandoned their carefully prepared research which went to public hearing and was finalized last year. Instead, G-P is being allowed to fund high-profile local political projects, and regional public wishes are being ignored.
5. Northern communities completely neglected ALL of the $3.9 million in G-P recreational dollars are targeted for Brown County communities only, where G-P operates its manufacturing facilities. NONE are planned for Door, Oconto,Marinette Counties, or Upper Michigan communities which also have serious PCB fish-eating warnings due to Fox River pollution. If recreation is the goal, then ALL the northern people should have equal access to these recreation dollars. Instead, it appears G-P has been allowed to buy-off local officials with juicy projects, with every Brown County municipality getting a piece. In addition, all the land purchases for wildlife habitat are on the Bays westshore, with nothing for the eastshore, Michigan or Door County, though most of the PCBs are concentrated up the Door County shoreline. The DNR claims future settlements with other mills may balance these issues better, but how can we be sure when we have a comment period now but wont be see the big picture plans until later?
6. Misuse of the Fox River Remedial Action Plan The DNR claims to be following the old Remedial Action Plan started in 1986, but that effort was dominated by Brown County people and included no one from the impacted north. Also, that plan did not set a high priority on recreation projects. To the contrary, recreation access was far down the list of concerns. The DNR is misusing the work of a lot of people, including Clean Water Action Council members who participated in that process.
7. The Bush Administration has abandoned federal leadership This settlement is just a larger version of the DNRs surprise solo $7 million proposal in November 2000. It contains all the same flaws which were roundly criticized by the U.S. Fish and Wildlife Service and other federal agencies at that time. Its obvious that the federal government is now taking a back seat and allowing the state to decide everything, even though the state fought against negotiating for ANY compensation for several years.
8. The Cart Before the Horse Under Clinton, we were promised many times that the Restoration Plan and individual settlements like this couldnt be finalized until after the sediment cleanup plan and EPAs Record of Decision (ROD) are announced (possibly only a month from now). This timing sequence was important because the scale of the restoration is supposed to be based on how long it takes for sediment cleanup to achieve results. If it takes longer, then more compensation is due from the polluters and dollar amounts should increase. Now, under Bush, were being told its OK for the Restoration Plan to be released before the ROD, deliberately keeping the public in the dark on this issue.
9. Inflated, False Settlement Dollars We found many discrepancies between last years dollar values and this years in the settlement deails Even though last years deal called for fewer recreation projects, they were estimated to be worth a million dollars more than this years larger projects. (Were we being misled last year?) And last years land acquisition value for the Peshtigo Marsh property was much lower than this years high land values. Only 363 more acres of land were added to this years deal, but the dollar values rose by $5 million. This equals $13,774 per acre added. (Are we being misled now?) We need to know true costs of land purchases, not inflated values to make this settlement look bigger than it really is.
10. Stopping the Federal Process? The U.S. Fish and Wildlife Service (under Bush) now says they may not write a Report of Assessment, though this is supposed to be the final stage of the Natural Resources Damage Assessment process. This report would have included a responsiveness summary (the agencies written responses to citizens hearing testimony and letters). Also, it would have included a preliminary estimate of damages with more complete totals than previously reported, and a demand for sum certain (a final bill to be presented to the responsible polluters.) Weve been told now that as long as the governments were satisfied with the negotiated settlements, the Report of Assessment could be skipped, because the polluters dont want to have to pay for its preparation. The Service says they will write the report only if a polluter sues to oppose their settlement. Citizens will be asked to comment on the final proposed Restoration Plan without this information, and we may never have a final accounting.
11. Taypayer Costs Should Be Fully Reimbursed This G-P settlement allocates only $1.5 million to reimburse federal costs of assessment, $50,000 toward the states costs, and $50,000 towards the $311,322 cost of federal management of the 56/57 dredging site cleanup. Weve been told the feds spent about $10 million to prepare the multi-document scientific damage assessments and economic damage models, over the 7 year study period. We must insist these costs are separate, and in addition to, compensation and restoration settlements from the polluters. State costs should also be reimbursed completely. (After all, why should taxpayers be stuck with this?) G-Ps $1.6 million isnt enough.
12. Industry Pressure Politics and Political Favors Weve heard that the Fox River Group of paper industries have been sending company lawyers and lobbyists to meet with our local, state and federal agency officials and our elected representatives, keeping up constant lobbying pressure for weakening the cleanup and compensation plans. Ordinary citizens have no means to match that pressure, and its obviously costing us millions of dollars now.
Campaign contributions also seem to play a role: Congressman Mark Green, a prominent Republican influence in these negotiations, received $6,500 in contributions from Georgia-Pacific Corporation for his most recent election cycle. Not surprisingly, Greens been a big defender of the paper industry against PCB cleanup and compensation.
Another influence is Lee Thomas, President of G-Ps Division of Building Products and Distribution. Thomas was the U.S. EPA Administrator from 1985 to 1989, under the Reagan and Bush (Senior) Administrations. He previously served as EPA Assistant Administrator for Solid Waste and Emergency Response, which included management of the Superfund Program. Its obvious Thomas would still have strong connections within the new Bush Administration, and he would know exactly how to use his influence within the Superfund and related NRDA programs.
(See last months newsletter for additonal corporate links within the Bush Administration.)13. This Settlement is NOT Better than Last Years Last years $7 million proposal was to cover only the State of Wisconsins share, and did not include further dollars to compensate Michigan, tribal and federal damages. Those damages would have required a second separate settlement. Therefore, the doubling of dollars over last years proposal is misleading because ALL the government damages from all levels are combined in this one settlement. This is definitely not a better deal.
14. Bad Precedent Being Set Government officials call this settlement a good start, but it is final and sets a terrible example as the first of 7 settlements with individual corporations which dumped PCBs in the Fox River. If G-P gets away with paying only 20% of its responsibility, the others will demand equal treatment.
15. G-P Can Afford Much More Georgia-Pacific is a huge multi-national corporation which had $6.3 billion in total assets in 2001. Keep in mind that when Fort Howard Corporation and James River Corporation merged just a few years ago, they spent $500 million just on the costs of restructuring. Then two years later, G-P bought the merged company and spent huge sums to go through restructuring again. Their executives were shuffled or let go at a cost of many millions, and their current executives are paid very handsomely. This corporation can afford to meet its moral and legal obligation to compensate the public for damages it caused.
In Novemer 2000, the U.S. Fish and Wildlife Service announced the final Restoration and Compensation Determination Plan, for the Fox River and Green Bay, as compensation for economic damages to our region from PCB contamination. Five public hearings were held. This concluded 7 years of economic and technical research, and preparation of numerous reports documenting damages as part of a Natural Resources Damage Assessment.(NRDA)
[Note: We have two separate, but parallel projects to follow: the CLEANUP plan and COMPENSATION plan. The NRDA is the compensation plan.]
The Service was joined by several other governments as co-trustees of our natural resources: the State of Michigans Attorney General, on behalf of the Governor of Michigan; the National Oceanic & Atmospheric Administration (under the U.S. Dept. of Commerce); the Oneida Tribe of Indians of Wisconsin, the Menominee Tribe of Wisconsin, and the Little Traverse Bay Band of Odawa Indians (in Michigan). All these governments worked well together to write a plan.
Unfortunately, the State of Wisconsin, under Governors Thompson and McCallum, rabidly opposed the concept of compensation. Their DNR has argued that ALL the money is needed for sediment cleanup, and compensation is not important. Because of this basic philosophical difference, the state lobbied aggressively against the NRDA, and in 1997 signed a surprise contract with the 7 paper companies (with no prior public awareness or input) to have the companies pick consultants to write a state-version of an NRDA in direct competition with the federal-led NRDA. Not surprisingly, the resulting state plan grossly undervalued the publics losses and undercut the federal-led NRDA. The state was not willing to fight for justice in the publics interest.
Shortly after the U.S. Fish & Wildlife Service announced its final compensation and restoration plan, the state announced it had signed a surprise NRDA settlement with Fort James Corporation (now Georgia Pacific) for $7 million, and refused to hold a public hearing. This was widely criticized as too little. After an investigation by the state Legislative Fiscal Bureau, the DNR suspended the agreement, (it has just surfaced again with this proposed settlement.)
Last summer (2001), the Intergovernmental Partners (federal, state, and tribal) proposed another surprise deal: a $40 million downpayment from Appleton Paper Company and NCR Corporation over a 4 year period. In exchange, the governments would agree not to sue for more and the NRDA process would be suspended during that time frame. This was the first major policy departure for the federal government.
The U.S. Fish & Wildlife Service estimate of $333 million in PCB damages was an extremely conservative, because the following factors were not included:
Damages to the Lake Michigan Economy Only Fox River and Green Bay damages were included, despite the fact that up to 70% of the waterborne PCBs in all of Lake Michigan have come from the Fox River, and will continue to circulate in the Lake for at least a hundred more years. The PCBs have already led to many decades of fish-eating advisories for sport anglers and strict prohibitions against commercial harvest of many fish for market or restaurant sales all around Lake Michigan..Please send your Comment Letter TODAY!Discouraged Anglers For decades, thousands of discouraged anglers have stopped or never started fishing on the Fox River, Green Bay, or Lake Michigan, due to PCB contamination. The resulting economic losses could easily dwarf the losses experienced by currently active fishermen and the businesses (charter boats, baitshops, restaurants, hotels, gas stations, marinas, etc.) that depend on them. The Service was too conservative in calculating damages based only on currently active anglers.
Closed Commercial Fisheries Several species of river and bay fish are off-limits to commercial fishermen. Many multi-generation family businesses have been forced to close, or have had serious financial losses.
Discouraged Duck Hunters Duck hunters have also faced strict consumption advisories due to PCBs.
Human Medical Costs and Lost Work The Service was not allowed by law to include economic losses due to human health effects. Roughly 40,000 people along the waterfront face PCB cancer risks equal to smoking two to three packs of cigarettes a day, due to fish eating. Non-cancer PCB risks (thyroid disease, diabetes, heart disease, liver damage, memory problems in adults, learning disabilities in children, etc.) may affect thousands more. A private civil action is required to get compensation for citizens who believe they have been harmed by PCBs. (Documentation of several types of human health risks from PCBs is online at: www.FoxRiverWatch.com)
Lost Food Value Thousands of subsistence fishers and hunters (including low income and ethnic people) face major economic losses if they follow the fish advisories and are forced to purchase an equal quantity of store-bought fish or other protein sources. Green Bay is one of the most productive estuaries in the entire Great Lakes region. The grocery store value of the thousands of tons of fish which could be produced annually is enormous.
Dredge Disposal Costs Harbors and marinas face high maintenance costs due to disposal rules for PCB contaminated sediments dredged from shipping channels and boat slips. The costs run into the millions.
Drinking Water Costs Because the river and bay are polluted, area communities rely on dwindling groundwater or expensive pipelines to Lake Michigan for drinking water supplies. More than a billion dollars will be spent on pipelines alone (when longterm financing is included.) Local water ratepayers are paying higher rates because the abundant water on our doorstep is unfit for drinking even after standard treatment. At the same time, some of the same corporations, such as Georgia-Pacific, use high-capacity wells to draw down the publics groundwater supplies, adding further to home ratepayers costs. These corporations are being offered the lowest rates as bulk water users, while citizens are forced to pay more.
Swimming Impacts Popular swimming beaches are closed due to pollution. People dont feel safe swimming in the Fox River or Bay, largely due to PCBs. (A study with monkeys found that 14% of PCBs spread on their skin was absorbed in 24 hours, according to Wis. Division of Health. (See www.FoxRiverWatch.com for more information on skin absorption of PCBs.) Local communities have had to build costly artificial pools and water parks to compensate for the polluted condition of our natural river and bay beaches.
Wildlife Damages Damages were not included to economic interests in lake trout, terns, and other wildlife suffering deformities, tumors and reproductive failure. Threatened and endangered species have been harmed and deserve habitat compensation above and beyond the human economic losses. Bird-watching and other valuable wildlife enjoyment activities have been harmed, with significant economic effects.
Growth Factors As human population grows over the next 100 years, the economic and social losses due to PCBs will also increase. Brown Countys population alone increased 14.5% in the last 10 years, and such growth should be factored into the economic damages.
Property Damage Many waterfront homes, businesses,and public properties have been devalued for decades due to the PCB contamination.
Non-adjacent Counties Damages were estimated only for counties adjacent to the Fox River and Green Bay, and did not include PCB impacts on anglers, hunters, wildlife watchers, or businesses in other nearby (or distant) counties. For example: a sporting goods store in Shawano County could have had significant losses over the years due to suppressed fishing and hunting due to PCB contamination.
Citizen letters are extremely important. They will be shared with the federal judge who rules on whether this settlement is acceptable. The judge has wide latitude to decide whether to delay or modify the settlement, or send it back for renegotiation. Public acceptance is supposed to be a major consideration in the judges decision-making. If you are short on time, please clip-and-mail the letter included on page three of this newsletter!
You can also send additional comments with it.
Write to the Dept. of Justice
Assistant Attorney General
Environment and Natural Resources Division
United States Department of Justice
P.O. Box 7611
Washington, DC 20044-7611
(In your letter, refer to the case: United States and the State of Wisconsin v. Fort James Operating Company, Civil Action No. 02-C-0602 (E.D. Wis.), and DOJ Reference Number 90-11-2-1045/1.) Comment deadline: August 3
Alabama Settlement also Shortchanges the Public
The Bush Administrations EPA secretly negotiated a bailout agreement dramatically lessening Monsantos clean up responsibility just weeks after the giant company was found liable for outrageous behavior by an Alabama jury, due to its PCB pollution of a town there. Anniston was one of Monsantos lead PCB manufacturing centers in the U.S.
The federal actions have embittered Anniston residents, city officials and the states environmental regulators. The state and local citizens had been aggressively pursuing lawsuits to force cleanup and compensation. Political favoritism is suspected, with former Monsanto operatives in key Bush Admin. decision-making channels. As a Senator, Attorney General John Ashcroft received $18,000 in campaign contributions from Monsanto. Deputy Attorney General Larry Thompson once served as Monsantos in-house counsel. The chair of the Council of Environmental Quality, James Connaughten, was GEs chief lobbyist arguing against a Hudson River PCB cleanup. Linda Fisher, Deputy Administrator of EPA and former Monsanto lobbyist and Bush campaign contributor, was forced to recuse herself from the deal.
EPA agreed not to list the Anniston site on the National Superfund Priorities List (as the Fox River is also NOT listed). This effectively limits the cleanup scope, the list of contaminants to be researched - and Monsantos potential liability for the contamination of the homes, the churches, and the people of Anniston.
For more information, call Laura Chapin of Environmental Working Group at 202-667-6982. Or visit their website: www.ewg.org
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