Gov. James McGreevey announced Wednesday that his administration had reached a “historic” $17 million settlement with three companies who allegedly deposited carcinogens at various sites throughout Hudson and Essex counties, mainly in Jersey City.
For more than 70 years, Hudson County was home to three of the nation’s six plants that generated chromium for machinery parts and other uses. Although it’s a natural element, its processing creates hexavalent chromium, a waste product that is now found to be a cancer-causing agent.
Standing at a podium behind the fog-enshrouded Statue of Liberty and next to a fenced-off chromium site in Liberty State Park, McGreevey said the settlement signaled the beginning of the state’s aggressive pursuit of companies who “desecrate or destroy” New Jersey’s natural resources.
“The message today is clear,” he said. “Through the offices of the attorney general and the Department of Environmental Protection, we are holding corporate America responsible.”
The $17 million payout – which came from talks between the state and the three companies and did not involve any litigation – addresses the “natural resource damages” (NRDs) stemming from the contamination of both groundwater and 210 chromium waste sites across Hudson and Essex counties.
In the agreement, Morristown-based Honeywell International will pay $8.6 million; Pittsburgh, Pa.-based PPG Industries will pay $6.7 million; and New Brunswick-based Tierra Solutions, Inc. will pay $1.6 million.
While environmentalists lauded the settlement, some Jersey City politicians present at the event unabashedly picked the governor’s settlement apart on two points, saying it is glaringly insufficient and unfairly allocated.
“By my estimation, there is $800 million in [chromium pollution] damage throughout Jersey City, and 20 percent of the total damage is what’s commonly used by environmental engineers to determine a ballpark figure for natural resource management,” Assemblyman-Elect Louis Manzo said. “And now they’re negotiating a deal for $17 million? These guys are insane.”
Under Manzo’s formula, the amount Jersey City needs to properly rehabilitate its natural resources should be $160 million.
From whence the money?
State officials and local preservation activists took great care last week to explain that the $17 million settlement was earmarked for “natural resource damages,” which is the dollar value of the total restoration necessary to compensate the residents of New Jersey for the injury to its natural resources. These injuries, state spokespersons said, are either ecological (actual damage to wetlands, wildlife or groundwater) or human use (such as the closure of a beach for swimming or a waterway for fishing).
The money awarded for NRDs, officials emphasized, does not go to site cleanup.
State officials said it will be used to fund priority projects, developed in concert with community and environmental representatives, that enhance local community and natural resources damaged by the contamination, including wetlands restoration at Liberty State Park and open space purchases that will improve water quality in the area.
The $17 million number was generated using a publicly available formula that estimates the volume of contaminated groundwater, the value of the water, and the duration of the injury to arrive at a settlement amount, Department of Environmental Protection [DEP] Commissioner Bradley Campbell said. He would not elaborate Wednesday on the specifics of the negotiation process, including the difference between the formula estimate and the actual amount settled on between the parties.
Where it’s going
The settlement money will be shuffled into DEP coffers through its Office of Natural Resource Damages, which was created in 1993 by former Gov. Christie Whitman. The DEP will then allocate the money for restoration projects and land purchases in the same watershed or general area of damage, Campbell said.
“We’re very pleased the administration is bulking [the NRD office] up because it means the polluters are paying,” said Greg Remaud, president of the Liberty State Park Conservancy. “I’d like to wholeheartedly thank Governor McGreevey, DEP Commissioner Campbell and Attorney General Harvey for bringing to life the [NRD] program.”
Remaud also said the potential of these NRD monies was significant, and he used as an illustration a different multi-million dollar restoration of Jersey City’s Lincoln Park from the initial settlement of $250,000 from a caustic soda spill in South Kearny.
Wednesday’s announcement marked a milestone for the McGreevey administration, various officials said. The $17 million is part of $24 million in NRDs that have been collected since McGreevey took office two years ago, an amount in excess of what the office was able to collect in the previous eight years of its existence.
The reason for this, preservation officials said, was the prior Republican administration’s reticence at bringing companies to task for their polluting habits.
“Republicans gutted the law for the state to get natural resource damages and made it so that it could only collect through litigation,” said Jeff Tittel, New Jersey Sierra Club director. “This is the real deal. It’s the best the state can get.”
Many attorneys who worked for the state during the Republican administration were previously employed by the companies from which the state was trying to collect, he said, and it was no surprise that the intake of NRDs was as low as it was.
Ironically, Whitman was appointed the head of the national Environmental Protection Agency shortly after President George W. Bush was sworn into office in January 2001. She has since resigned from that post, citing a desire to spend time with her husband, children and Hunterdon County home.
Most sites in Jersey City
Long-term exposure to hexavalent chromium through direct contact, inhalation or digestion may cause allergic reactions, respiratory or kidney problems and increased risk of lung cancer.
When the factories were processing the chromium and generating millions of tons of its harmful waste, it wasn’t widely known that it was a carcinogen. A common disposal method of the time was to use the chromate waste as fill material and disperse it among various sites across the region.
The state has since discovered that there are 210 chromium waste sites in the area, spread across residential, commercial, industrial and recreational areas. Of those 210 sites, 207 are located in Jersey City.
And the fact that Jersey City has been the most affected municipality in the chromium contamination is what led current and former local politicians to renounce McGreevey’s settlement.
Assemblyman-elect Manzo, who served as the city’s environmental protection officer in the early 1980s, said contaminated sites remain undiscovered in Jersey City. He urged that the state use that money to implement a health study in the area.
Former mayor Gerald McCann, who was also present at Wednesday’s press conference, said Jersey City should be the sole benefactor of the $17 million.
“Seventeen million dollars is a drop in the bucket,” McCann said. “One hundred percent of that money should come to Jersey City. Our damages far exceed what they settled for.”
Other settlement
McCann said that because Jersey City led the $1.5 million assault against those companies with its 1983 lawsuit against Honeywell predecessor Allied Signal Corp, it should be Jersey City who enjoys the spoils of the lawsuit. To further the injustice, the municipality suffered even more damage in the unavailability of the many contaminated parcels for development, which has contributed to the city’s low rate of taxable properties.
“The point of it is that we spent a lot of our own money to sue them,” McCann said. “And it goes to the state to fix their own park?”
As of press time, it was unclear whether the city had the legal recourse to seek compensation for those aspects of the damages incurred by the contamination. It was also unclear whether the $17 million settlement precluded those three companies from being responsible in the future to pay damages for other sites.
The settlement is also separate from other prominent complaints such as the one filed against Honeywell by the local Interfaith Community Organization [IFO], which targeted a chromium spill site on Route 440 next to the Hackensack River. In May 2003, a judge found in favor of the IFO and ordered Honeywell to clean up the site, costing the company approximately $400 million.
Although Honeywell is appealing that decision, company representative Kate Adams said Wednesday that the settlement illustrated the company’s efforts at restoring contaminated properties to their original conditions.
“This is a wonderful accomplishment,” said Adams, who is the deputy general counsel for Honeywell. “It shows Honeywell’s long-standing commitment to corporate environmental responsibility.”