Aerojet-General and Seven Other Polluters Agree to Cleanup Deal
Source: 
San Gabriel Basin Water Quality Authority

$250 Million Cleanup Agreement Culminates Two Years of Negotiations

Aerojet-General Corporation and seven other San Gabriel Valley companies accused of polluting the groundwater in the San Gabriel Basin agreed Monday to participate in a $250 million cleanup agreement.

The action culminates more than two years of private negotiations for a cleanup deal to finance, construct and operate facilities to remove industrial contaminants and restore groundwater supply in the Azusa-Baldwin Park area, which has been on the federal Superfund cleanup list since 1984.

The agreement was reached shortly after the San Gabriel Basin Water Quality Authority publicly released a draft of the groundwater cleanup agreement, despite the objections of Aerojet and other polluters who said the cleanup negotiations should remain behind closed doors.

The WQA board had voted unanimously Friday to release the draft agreement in hopes the action would result in a successful conclusion to the negotiations, saying that after 28 months of talks, they felt an obligation to let the public, and especially water rate payers, know the details.

"It's been 22 years since contamination was first discovered in the San Gabriel Valley's groundwater. Everybody's happy that this day has finally come," said Bob Kuhn, chairman of the Water Quality Authority board. "We have said all along that the polluters should pay for the cleanup and not the water ratepayers. This agreement guarantees that that will happen."

Mr. Kuhn thanked the EPA's newly appointed Region IX administrator, Wayne Nastri, and Region IX superfund director, Keith Takata, for their roles in the ongoing negotiations. "Wayne came in with a fresh perspective and an attitude of how are we going to get this done." The WQA also thanked Sen. Barbara Boxer (D-CA) and other San Gabriel Valley elected officials for their support.

The comprehensive project agreement defines six water cleanup and supply projects that would be constructed, operated and maintained for at least 15 years. Operation and maintenance would be approximately $4 million the first year, $8 million the second year and $12-$14 million in subsequent years. When all of the new cleanup and water supply projects are in full operation they will produce a combined total of 38,250 gallons of water per minute to augment the area's water supply.

"I am just relieved we can now move forward with assurance that we will have the money to move quickly on the cleanup projects," said WQA board member Ken Manning. "Most of the designs on the projects are already in place."

Five areas of the San Gabriel Valley, including the Azusa-Baldwin Park area, were placed on the federal Superfund cleanup list in 1984 after traces of industrial solvents and rocket fuel were found in the groundwater.

Water providers have maintained a safe water supply by closing more than 30 wells affected by spreading contamination. But without the cleanup they are in danger of losing more and more wells, which provide 90 percent of the valley's water supply.

The U.S. Environmental Protection Agency has identified Aerojet and 19 other Responsible Parties as the source of the largest contaminated area, which is in the vicinity of Azusa-Baldwin Park area. In September 1999, Aerojet and 11 other polluters made an offer to fund a $200 million cleanup but the talks broke down a year later without an agreement.

The EPA ordered Aerojet and the others to begin the cleanup without an agreement and WQA and other water providers sued Aerojet to recover public funds they had already spent on emergency cleanup facilities. In January 2001, Aerojet and six other responsible parties made a $4 million payment to WQA and other water providers and agreed to resume negotiations for a comprehensive agreement.

With no agreement after nearly a year, local water agencies including the Water Quality Authority called on EPA to help exert pressure on Aerojet and the responsible parties to sign the agreement.

Eleven other Responsible Parties in the Azusa-Baldwin Park area who refused to participate in the negotiations remain at risk for legal action by other parties to recover a fair share of the project costs.

The WQA, the Main San Gabriel Basin Watermaster, and the water purveyors have maintained from the start that the polluters should pay for the cleanup and that the clean water, which meets all state and federal drinking water standards, should not be wasted but used to replace the water supply that had been lost due to contamination.

But water providers have lost more than 31 wells to migrating plumes of underground contamination since the valley contamination sites were put on the federal Superfund list 18 years ago.

Under federal law, the WQA, Watermaster and water providers would have been able to sue the polluters later to recover costs after they have spent the money. But in order to raise the initial capital necessary to build the projects, some water providers had said they might have to raise water rates. In effect, ratepayers would have funded the cleanup pending the outcome of federal lawsuits.

The California Legislature created the San Gabriel Basin Water Quality Authority in 1992 to coordinate and accelerate the cleanup. The WQA has generated $35 million for cleanup projects, including $12 million in government grants and $13 million from potentially responsible parties who entered into settlement agreements to pay a share of the cleanup.

Urgency projects completed with WQA participation have removed 10 tons of contaminants from the basin, more than half of all contamination removed since 1979. But this is only a small portion of the total contaminants that will be removed by the cleanup facilities outlined in the EPA's cleanup plan for the Basin.

 
Fact Sheet

 
San Gabriel Basin Water Entities

 
Project Agreement Summary

 
• Comprehensive Project Agreement defines six water cleanup and supply projects that would be constructed, operated and maintained for at least 15 years.

• Eight Responsible Parties involved in negotiations would provide more than $250 million in funding for construction, operation and maintenance.

• Eleven other Responsible Parties in the Azusa-Baldwin Park area who refused to participate in the negotiations are at risk for legal action by all parties to recover a fair share of the project costs.

• When all of the new cleanup and water supply projects are in full operation they will produce a combined total of 38,250 gallons of water per minute to augment the area's water supply.

• Capital costs for construction of the new facilities would total about $80 million. Operation and maintenance would be approximately $4 million the first year, $8 million the second year and $12-$14 million in subsequent years.

• The costs may be offset by public funding obtained and allocated to the Azusa-Baldwin Park cleanup by the Water Quality Authority.

• After 15 years, the parties will be able to negotiate again for an extension of time as long as may be needed to clean up the groundwater.

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