The agreement settles a 2001 claim brought by the federal government under the Superfund law to recover past and future costs related to asbestos removal from homes, businesses, schools and playgrounds in Libby, officials with the U.S. Justice Department and U.S. Environmental Protection Agency announced Tuesday. The action came a full eight years after media reports first made public the fact that asbestos was killing people in the tiny northwest Montana town. More than 200 Libby residents have died from asbestos-related disease.
Numerous department officials characterized the agreement as the largest Superfund settlement in history for cleaning up polluted sites.
The settlement requires W.R. Grace to pay the $250 million within 30 days of approval by a federal bankruptcy court in Delaware, Ames said. The court will ultimately determine whether it's in the best interest of the public and the creditors to resolve Grace's liabilities in Libby.
This week's bankruptcy settlement has no bearing on the criminal charges against W.R. Grace and its senior corporate officials, who allegedly conspired to hide the dangers of asbestos and obstructed justice during the EPA's investigation and cleanup.
Since 2000, the EPA has spent approximately $168 million removing asbestos-contaminated soils and other materials in and near Libby, said Paul Peronard, the EPA emergency coordinator who has been involved in the cleanup since 1999. The money also went to medical investigations, X-rays and CT scans for thousands of Libby residents.
Peronard estimates that an additional $175 million will be required before those cleanup efforts are considered a success, though he concedes that “the actual cleanup targets are uncertain.”
“Even if I figure out how clean is clean, there will be material left behind in Libby, either because we missed it or because it's hidden in a wall or underneath somebody's septic tank,” said Peronard, currently the EPA's project team leader for cleanup in Libby.
If approved by the court, the settlement proceeds will be paid into an independent Superfund account that can be used to recoup cleanup costs, recover future cleanup costs, pay for future investigations and help with operation and maintenance. Also, $11 million will be immediately set aside for future projects, such as home renovations that require emergency cleanup or asbestos education programs.
“I don't ever see a time when we don't need some kind of program in Libby,” Peronard said. “That being said, I think we will be able to come up with a notion of what cleanup can ultimately accomplish.”
The $250 million will be used to fund projects outlined in an upcoming report, or record of decision, to be issued by the EPA. Once the work set out in the report has been completed, the money will go back into the main Superfund, Peronard said.
“But the idea is that this money is set aside in an account for Libby, and it is to be used first and foremost for work in Libby,” Peronard said.
The EPA has been removing asbestos contamination in Libby since 2000. The federal government filed suit against W.R. Grace in March 2001 to recover its investigation and cleanup costs. A month later, Grace filed for bankruptcy protection to ward off thousands of asbestos-related lawsuits.
U.S. District Judge Donald W. Molloy presided over a notable 2003 lawsuit in which he ordered W.R. Grace to pay the EPA $54.5 million to cover costs of asbestos cleanup in Libby. That award has not been paid due to the company's bankruptcy. However, this week's settlement resolves the 2003 judgment in addition to cleanup costs the EPA has incurred since.
At the criminal trial expected to open in Missoula in April or June, federal prosecutors intend to rely on studies and investigations conducted by EPA officials.
One federal study concluded that more than 1,200 people in Libby and surrounding areas show signs of lung abnormalities tied to asbestos diseases from the mine. The problems appeared not only in miners who had worked at the site, but Libby residents who came into contact with fibers in the course of their daily lives.
Professor David M. Uhlmann, the former chief of the Justice Department's Environmental Crimes Section who helped prosecutors mount their case against Grace, said Tuesday's “record settlement helps recover the costs of the EPA cleanup in Libby, Montana.
“But the bankruptcy settlement leaves for another day the question of whether W.R. Grace and its senior corporate officials are criminally responsible for knowingly endangering the citizens of Libby, Montana and obstructing justice during that EPA cleanup,” said Uhlmann, currently the director of the Environmental Law and Policy Program at the University of Michigan Law School.
After the settlement announcement, U.S. Sen. Max Baucus, D-Mont., issued the following statement:
“More money for Libby is always a good step. But, as always, the devil is in the details. W.R. Grace knowingly poisoned the people of Libby and devastated an entire town. $250 million is a drop in the bucket compared to the destruction and pain our neighbors in Libby have been through. EPA has spent approximately $120 million on Libby already and they still can't tell us how clean is clean. I've been fighting for folks in Libby for a long time and I want to make sure they get the health care they need and their town is cleaned up once and for all.”
U.S. Sen. Jon Tester, D-Mont., also released a statement Tuesday afternoon:
“You can't put a price on human lives, and far too many folks were lost in Libby because of asbestos. Cleaning up the mess and taking care of the Montanans poisoned by W.R. Grace will take years of hard work. It will also require responsibility from a company that knowingly turned so many Montana families into victims.”
Reporter Tristan Scott can be reached at 523-5264 or at tscott@missoulian.com.
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