The Port of Los Angeles last week warned that it may scale back recreational development in the harbor if air quality officials shut down its largest exporter of bulk commodities because of complaints about dust from recreational boaters.
In a written statement distributed at a meeting of the South Coast Air Quality Management District hearing board, the port warned that closing the Kaiser International bulk-loading facility along the West Channel in San Pedro, as recommended by the AQMD staff, "would impact planning for all future facilities in the West Channel area of the port."
The port has already spent $45 million on a new marina and recreational complex in the West Channel, and it plans to spend an additional $30 million on other marinas and recreational facilities in the area. There are about 2,000 private slips in the West Channel, all of which are on property owned by the Harbor Department.
"We can't live with having another administrative agency say that industrial facilities can't be here because the recreational users complain," said Jonathan P. Nave, deputy city attorney for the port, in an interview. "It would allow the tail to wag the dog."
Board Votes to Delay Hearing
The AQMD board Thursday voted unanimously to delay until June 17 a hearing that could force Kaiser International out of business because of complaints that its coal and petroleum coke operations are the source of black dust that pollutes the air and damages boats.
The port joined Kaiser International in requesting the delay, saying a shutdown would have a "strong impact" on the port's willingness to set aside space and money for recreation in the harbor. Port officials did not elaborate on what projects could be jeopardized.
Kaiser International, which handles about 90% of dry bulk exports from the port, exports about 1 million tons of coal, 600,000 tons of petroleum coke, 300,000 tons of steel scrap and 200,000 tons of copper concentrate each year from the bulk loader.
Company officials estimate that the operation pumps about $75 million a year into the Southern California economy, and port officials said the company pays about $2 million a year to the port in tariff charges. The port owns the $23-million bulk-loading facility, which it built in 1965, and has leased it to Kaiser International since 1984.
Port and Kaiser International officials asked for the delay so that they can review documents submitted by air quality district inspectors in March that explain why the inspectors denied the company two essential operating permits for the bulk loader.
District inspectors refused to issue the permits in March, not because of air-quality violations but because they concluded the facility constituted a public nuisance due to the boat owners' complaints. Inspectors said the nuisance determination came after they verified three times that boats were being covered with dust, twice in November and once in December.
Kaiser International has been operating with permits issued to the bulk loader's previous operator while air quality officials reviewed its applications for new permits, officials said.
Kaiser, which says the dust does not come from its operations, last month appealed the permit denials to the AQMD board.
Boaters from several marinas near the bulk loader praised the inspectors' decision to deny the permits and said the decision to delay the public hearing gives them more time to prepare their case against Kaiser International.
"We are in a better position to know what is going on," said Camilla Burgher, who works at Holiday Harbor marina and lives on her boat there. "We'll just get more pictures to show them."
Air quality inspectors and Kaiser International officials were sharply divided Thursday over whether the company can legally operate the facility during the appeal process.
Kaiser International President Richard E. Holdaway said after the board meeting that the company can legally operate the bulk loader so long as its applications have not been denied by the hearing board. But Patti Woods Goldberg, senior deputy counsel for the district, said, "The permits have been denied and therefore they must cease operation."
Holdaway said he has no intention of closing the bulk loader. After the board meeting, he lashed out at Goldberg in a hallway, saying she was trying to force his company out of business. Goldberg told Holdaway that she was sorry that he felt that way.
Michael Czap, air quality supervisor for the district, said that the district's enforcement division will order Kaiser International to shut down its operations soon. He would not give a specific date. If the company ignores the order, Czap said, it could be fined up to $25,000 a day if the hearing board upholds the decision to deny the operating permits.
Holdaway also accused Czap of trying to force his company out of business. Czap replied, "We're just trying to keep the air clean."
Nave, the deputy city attorney, said the Harbor Department has formed a task force that is investigating the possibility of moving the bulk loader to Terminal Island away from the marinas. That move, however, would take three to five years, he said.