McWane Inc. Settles with EPA, Agrees to Resolve Violations at Manufacturing Facilities in 14 States

July 15, 2010
EPA, the Justice Department, and the states of Alabama and Iowa announced that McWane Inc., a national cast iron pipe manufacturer headquartered in Birmingham, Ala., has agreed to pay $4 million to resolve more than 400 violations of federal and state environmental laws.

The settlement, filed in federal court July 9, covers 28 of McWane’s manufacturing facilities in 14 states and also requires the company to perform seven environmental projects valued at $9.1 million.

“In addition to meeting its environmental obligations and taking corrective measures, McWane will go beyond compliance and take action to protect communities that are at the greatest risk for air and water pollution,” said Cynthia Giles, assistant administrator for EPA's Office of Enforcement and Compliance Assurance. “The additional environmental projects included in the settlement will protect children, pregnant mothers, local residents and workers from harmful pollution and are an example of securing public health and environmental benefits in addition to those achieved by compliance with our nation’s environmental laws.”

“In 2004, we proposed to EPA and DOJ a transparent and innovative framework for the resolution of past civil compliance issues at our company,” said McWane President President Ruffner Page Jr.

Noting the proposed consent decree includes a comprehensive settlement of all outstanding historical civil environmental enforcement matters at 28 of McWane’s plants, some of which date back more than 12 years in the past, Page added, “This settlement establishes a fresh and positive relationship with EPA that will help us maintain our position as the industry leader in environmental, health and safety performance."

“As a result of this agreement, McWane has completely re-engineered its environmental management systems to ensure that it remains in compliance, and has committed over $9 million to environmental projects that will remove significant amounts of pollutants from the environment and benefit the surrounding communities,” said Ignacia S. Moreno, assistant attorney general for the Environment and Natural Resources Division.

The $4 million civil penalty will be divided among the United States, Alabama and Iowa. The environmental projects McWane will perform will address storm water contamination at numerous locations; reduce mercury emissions in Provo, Utah and Tyler, Texas; reduce volatile organic compounds (VOCs) emissions in Bedford, Ind. and Anniston, Ala.; and enhance air quality in Coshocton, Ohio. Additionally, McWane already has undertaken corrective measures to resolve the violations, at a cost of more than $7.6 million.

The settlement resolves civil violations over the past decade of the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act, the Emergency Planning and Community Right-to-Know Act, the Toxic Substances Control Act, the Safe Drinking Water Act and the Comprehensive Environmental Response, Compensation and Liability Act, as alleged by the United States, Alabama, and Iowa in the complaint.

As part of the settlement, the United States also required McWane to develop and implement a corporate-wide environmental management system (EMS) to promote environmental compliance, achieve pollution prevention and enhance overall environmental performance. The EMS was implemented prior to the filing and now is complete.

“We agreed to turn over to a third-party mediator results of prior environmental audits that we had conducted at our plants through independent, third-party auditors during two separate years,” said Page. “The mediator reviewed the audit results and recommended appropriate resolutions of the issues. These recommendations, together with issues identified by EPA and participating state environmental agencies, provided the foundation for negotiating the final settlement.”

The agreement requires McWane to conduct an audit of the EMS to evaluate the adequacy of the system. In addition, McWane has modified its corporate-wide stormwater pollution prevention plan and will develop or upgrade facility-specific plans as part of the agreement.

At its Coshocton, Ohio iron foundry, McWane will operate a cupola furnace, which is a particulate emissions source, in accordance with its newly revised Clean Air Act Title V permit. The consent decree further establishes operating conditions and emission limits for the furnace, and is separately enforceable by EPA.

The environmental projects included in the settlement will result in reduction of more than 4 million pounds of pollutants annually.

In the past, multiple McWane divisions and facilities have been the subject of criminal investigations that have resulted in five federal prosecutions. As a result, the company has paid more than $25 million in criminal fines and penalties and spent approximately $5 million on environmental projects. Company executives have been sentenced to prison terms of up to 70 months and the company and certain executives have been placed on probation.

“It is important to point out that this settlement does not involve new matters that reflect the current state of our operations; rather, this settlement is the beginning of the final chapter in the resolution of the historical questions that have been under discussion over the past several years,” said Page. “With the goal of 100 percent compliance, 100 percent of the time, we dedicated ourselves to go beyond mere compliance with laws and regulations and to become the model for our industry.”

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