Dow Chemical settles with feds on enviro violations

Federal officials have announced a deal with Dow Chemical over several longstanding environmental problems associated with operations at the company’s Midland complex.

On July 29 the U.S. Environmental Protection Agency and the Justice Dept. said that Dow has agreed to a pay a $2.5 million fine for practices that regulators found violated federal environmental laws and endangered public health.

The alleged violations were identified during inspections that took place between 2005 and 2007. Officials said it took years to investigate and negotiate a comprehensive settlement to address all the violations at Dow’s large Midland complex.

In a 24 count complaint filed in the Eastern District of Michigan court along with the settlement, the government accused Dow of violating Clean Air Act rules for monitoring and repairing leaking equipment, for demonstrating compliance with rules for chemical, pharmaceutical and pesticide manufacturing, and for failing to comply with reporting and recordkeeping requirements.

Dow also violated the Clean Water Act’s prohibition against discharging pollutants without a permit, the government said, and violated the Resource Conservation and Recovery Act’s requirements for hazardous waste generators.

In November 2007 when EPA notified Dow and the public that it had found potential clean air and hazardous waste violations, the agency said that the alleged violations may have increased public exposure to hazardous pollutants including ethyl chloride, toluene, ethylene, perchloroethylene, methanol and hydrogen chloride.

Hazardous air pollutants may cause serious health effects including birth defects and cancer and may also cause harmful environmental and ecological effects. These pollutants are also volatile organic compounds and are major precursors of ground-level ozone (smog). Smog is formed when a mixture of pollutants react on warm, sunny days. Smog can cause respiratory problems, including coughing, wheezing, shortness of breath and chest pain. People with asthma, children and the elderly are especially at risk, but these health concerns are important to everyone.

Though it took the chemical giant nearly four years to formally address the problems identified by regulators, and the company did not admit any wrongdoing, officials celebrated the settlement and its associated compliance program as a “model for industry” and a development that will protect people from emissions of hazardous air pollutants.

As part of the settlement Dow agreed to implement a program to reduce emissions of volatile organic compounds (VOCs) and Hazardous Air Pollutants (HAPs) though improved monitoring and better repair of leaking equipment. The company also promised to install improved valves that are less likely to leak.

“Dow worked cooperatively with the government to resolve this matter,” said Ignacia S. Moreno, assistant attorney general for the Environment and Natural Resources Division at the Department of Justice, “and in doing so set an example for responsible compliance with our nation’s environmental laws.”

According to EPA’s Enforcement and Compliance Online (ECHO), Dow’s Midland facility released 275,912 lbs. of toxic chemicals in the last year.

Craig Harris, a specialist in environmental sociology at Michigan State University, sees problems with the financial dimension of the settlement with Dow.

Via e-mail he said:

“During the 12 months of 2006, dow’s net income was $3.7 billion,” Harris said. “Extrapolating this to the 20 months during which the violations occurred would give a net income of $6.2 billion … in other words, the fine to which ‘our’ government agency has agreed represents less than one-half of one-tenth of one percent of Dow’s net income during the period of the infractions.”

“It’s hard to see how this reduces the incentive for future violations, as the U.S. EPA press release claims,” he said.

EPA officials said that the fine was determined using enforcement response policies that take into account factors including harm to public health and the environment, history of violations at the facility, degree of willfulness, cooperation of the defendant in resolving the violations, and litigation risk.

The agreement is subject to a 30 day comment period and final approval by the court.