$8 million water pollution fine hits out at corporate environmental cost cutting

A US steel company which violated the US Clean Water Act over a seven year period has been fined $8,244,670 in the second highest penalty that a judge has awarded to the United States since the law was passed in 1972.

The fine represents a doubling of the $4.1 million estimated to have been saved by the Allegheny Ludlum Steel Corporation by its delay and failure to invest in the necessary environmental controls, at its steel mills on the Allegheny and Kiskimenetas Rivers outside Pittsburgh.

Specifically, Allegheny Ludlum saved money by avoiding the costs of staffing four treatment plants 24 hours per day, delaying modernizing a wastewater treatment plant at its Vandergrift mill for many years while investing its capital to increase production of steel at that mill, and refusing requests from its own engineers to perform a number of capital projects to eliminate or reduce spills of acids and oils.

In 1995, the Justice Department on behalf of EPA filed a case alleging numerous violations by Allegheny Ludlum of its permit limits for toxic metals zinc, chromium, nickel and other metals. This also covered chronic spills of oil and grease, into the Kiskimenetas and Allegheny Rivers from its plants at Brackenridge/Natrona, West Leechburg, Bagdad, and Vandergrift, Pennsylvania. The Clean Water Act prohibits companies from discharging toxic and other pollutants into rivers and streams, but companies may obtain a permit for discharges within specific limits.

“Companies who violate the Clean Water Act face penalties much higher than any savings they think they will achieve by avoiding or delaying environmental investment,” said Thomas L. Sansonetti, the Assistant Attorney General for the Environment and Natural Resource Division of the Department of Justice. “This penalty is a fitting consequence for Allegheny Ludlum’s corporate disregard for compliance prior to the federal lawsuit.”

The court’s decision recognizes that the company is presently in compliance, but finds that Allegheny Ludlum’s record improved only after many years of state enforcement and filing of the federal lawsuit in 1995.

The court found that a substantial penalty was warranted by the frequency, magnitude and seriousness of these violations, which included 893 violations of toxic pollutant limits, 180 days when the company exceeded permit limits by at least 1,000%, and a “notorious” July 1994 oil spill from the company’s West Leechburg mill, which spread 30 miles downstream.

Allegheny Ludlum was also found liable for a large number of spills of chemicals and/or oil into rivers near Pittsburgh. These spills also posed the risk of health hazards because of nearby drinking water intakes, and they had a severe impact on the communities’ ability to use boats, swim and otherwise enjoy the rivers.

In 1997, the largest ever fine was imposed on Smithfield Foods Inc. and two subsidiaries, who were ordered by the US District Court, Eastern District of Virginia, to pay a civil penalty of $12 million for violating the Clean Water Act on thousands of occasions. In September 1999, the US Circuit Court of Appeals for the Fourth Circuit upheld the lower court’s ruling.

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