Parties in Vertac suit ask judge to end case

Jacksonville site now home to industrial park

Just beyond a flat expanse of concrete where workers are building a state-of-the-art police and fire headquarters for the city of Jacksonville, tall leafy trees loom over fields of green grass.

If you didn’t know it, it would be hard to believe that the area just west of Marshall Road and a stone’s throw from the Little Rock Air Force Base was once part of an industrial eyesore consisting of dilapidated buildings and thousands of rusting barrels of toxic waste stacked three high.

The site has been the subject of a lawsuit that has remained in the federal court system for three decades.But the case could see a final resolution by the end of this year. It is a resolution that has been a long time in coming.

In 1979, the Environmental Protection Agency discovered that the area had been contaminated by toxic waste as a result of four decades of herbicide manufacturing. The agency declared 93 acres then occupied by Vertac Inc. an official “Superfund” site and began years of hazardous waste cleanup that was financed by the multi-billiondollar trust fund.

A federal lawsuit the EPA filed in 1980 to recoup the cleanup costs from the manufacturers under the newly passed Comprehensive Environmental Response, Compensation and Liability Act was ultimately resolved in 2007 when the U.S. Supreme Court upheld a 2005 ruling assigning liability to two of the manufacturers.

Hercules Inc., a Delaware company that bought the property in 1961 and sold it in 1976 to Vertac Chemical Corp., was saddled with the lion’s share of the liability - nearly $120 million - while the former Uniroyal Chemical Corp. was held jointly responsible for about $3 million of the total. Both companies paid up in 2007.

Now, more than 32 years after the lawsuit was filed and five years after the Supreme Court silenced all appeals, the remaining partiesin the case are asking the latest judge to end it once and for all.

The remaining parties consist of Hercules, which under a 1984 court order continues to monitor and maintain the grounds, and remains responsible for any potential problems; attorney Lee Thalheimer of Little Rock, who has been the court-appointed receiver since Vertac abandoned the property in 1986; and the state Department of Environmental Quality.

At the urging of U.S. District Judge D. Price Marshall Jr., who inherited the case in December 2010 shortly after beginning his lifetime appointment, the parties have been working behind the scenes for months to draw up a mutual agreement to close the case.

Hercules attorney N.M. “Mac” Norton filed a proposed settlement agreement last month. Marshall, who inherited the case from U.S. district judges George Howard Jr. and Henry Woods, both deceased, has set a hearing for 1:30 p.m. Dec. 19 in his Little Rock courtroom to consider the request.

Meanwhile, any creditor or other interested party objecting to the proposed settlement has until 5 p.m. Dec. 7 to file a written objection with the U.S. district clerk’s office at 600 W. Capitol Ave., Room A149, in Little Rock. A public notice to that effect was published last week in the Arkansas Democrat-Gazette.

In an Oct. 5 brief, the 62-year-old Norton told the judge, who was a teen-ager when the case began, that, “This case has been going on for more than half of undersigned counsel’s life, and he is the oldest lawyer still standing in it.”

“Judicially,” Norton wrote, “this matter needs an end. The settlement agreement provides a resolution that is fair and practical for all concerned and will allow this case to be dismissed and closed.”

WHAT WOULD HAPPEN

If the judge approves the proposal, the receivership will have permission to convey or abandon its interest in the property that includes both uncontaminated and “remediated” zones. The agreement would require East Bay Realty Services Inc., a subsidiary of Hercules Inc .,to continue treating ground water and monitoring the site until regulatory authorities determine that no environmental hazard remains.

Hercules would be required to “immediately take all appropriate action” if “any incident ... causes or threatens to cause an additional release of hazardous substances from the site or an endangerment to the public health, welfare, or the environment,” and to follow up with a written report to the EPA.

“The settlement will allow this litigation to be terminated with all outstanding claims dismissed; it establishes remedial requirements (and associated funding obligations) related to the property ... and it provides for the creation of a regime of restrictive covenants to prevent inappropriate use of that property,” according to the motion filed by Norton and J. Mark Davis,both of the Wright, Lindsey & Jennings law firm in Little Rock.

Attached to the motion is a draft declaration of restricted covenants that Norton said “will insure into the indefinite future that no potentially harmful use may be made of or occur upon the property.”

According to the declaration, the property could be used only for industrial or commercial development projects that don’t have residential components or involve exposure to soils. That would rule out nursing homes, day care centers, playgrounds and church grounds, for example, unless environmental authorities approve exceptions in writing.

The declaration prohibits groundwater usage or contact; drilling or mining unless required for remediation; soil excavation unless permitted by environmental authorities; backfilling with untested or hazardous soil; and surface water use, including fishing.

Among other requirements, it stipulates that state and federal environmental authorities must retain unrestricted access to monitoring wells, pressure-measuring devices and streams on the property; fencing must be used to restrict certain areas; and storm-water runoff requirements must be met.

“The reuse possibilities will be evaluated as requested by any potential purchaser or leasee once this agreement has been finalized,” said Kelly Robinson, public information coordinator for the Arkansas Department of Environmental Quality.

“Some of the areas are proposed for limited industrial use and others less restricted,” Robinson added.

ALREADY ON SITE

In addition to the public safety building that the city is constructing on some of the acreage, which the state transferred to the city a few years ago to recoup lost tax money, the city operates a drive-through recycling center on the site.

Robinson said a contractor at the Air Force base is considering using a portion of the site for a training center. No other potential uses for the property have been publicly discussed.

So far, no one has registered any opposition to the proposed settlement, and Mayor Gary Fletcher said he doesn’t anticipate any.

He noted that Jacksonville’s proximity to the air base makes its population largely transient, which means that many residents who were once afraid to go near the old Vertac site have since moved away, while others who have grown up around it don’t even know about it.

As a former alderman who once championed a failed community effort to prevent the on-site disposal of contaminated waste through incineration, Fletcher says that even he no longer worries about hidden dangers lurking in the soil.

“I would sooner have a picnic with my family on this land than in my own front yard,” Fletcher said, motioning to an expanse of lush greenery, and noting that residential yards are often treated with pesticides.

He pointed out that wildlife, such as deer and foxes, are often seen romping through the once-suspect land - “and I haven’t seen any with three heads.”

Fletcher could barely contain his excitement about the fact that the sprawling, 45,000-square-foot public safety building, with large windows looking out on the green fields, is scheduled forcompletion in mid-December.

Already, between the recycling center and the land where the public safety headquarters is under construction, the city has a multi-story facility where firefighters practice extinguishing fires and rescuing trapped occupants. Varying roof heights, slopes and materials are used for realistic practice sessions, as are deliberately dark and murky interior hallways that mimic what firefighters encounter inside burning structures.

Fletcher, while admitting he’s no scientist, is optimistic about the site.

While hesitating to speculate about the safety of fenced-in areas that continue to be monitored for possible dioxin contamination, Fletcher confidently declares that the part of the land on which the city is building a future is nothing to worry about.

“It’s a new day,” he says with a wide smile.

If the judge agrees, the city and the parties in the case will soon be able to move beyond the Vertac days and leave the dioxin contamination stories of previous decades in the history books.

In fact, court records show that’s exactly what Thalheimer, the receiver, intends to do.

In documents filed on his behalf in August by attorney Richard Ramsay of Little Rock, Thalheimer notes that in order to close the receivership, he must dispose of all company assets, including company records that have been held in storage and that he believes have “historical value.”

“To that end, the Receiver has been in negotiations with the University of Arkansas at Little Rock Center for Arkansas History and Culture/Arkansas Studies Institute concerning a potential donation of the Vertac company records,” the document states.

The university, it says, has “agreed to receive the company records; to house them; to process and preserve them according to standard archival procedures; and, to make them available to scholars and researchers.”

An attached “donor agreement” indicates that the process of transferring the records would occur in three stages and cost an estimated $9,422, which includes renting storage units, hiring two students to work nine weeks, and buying supplies such as shelving, boxes, examination gloves and face masks.

Northwest Arkansas, Pages 7 on 11/19/2012

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