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4 Oil Firms Will Settle McColl Suit

September 16, 1994|LESLIE BERKMAN | TIMES STAFF WRITER

FULLERTON — The U.S. Environmental Protection Agency said Thursday that four oil companies have agreed to pay $18 million to settle a lawsuit over the long-delayed cleanup of the McColl toxic waste dump in Fullerton, created during World War II.

The payment by Shell Oil Co., Atlantic Richfield Co., Union Oil Co. of California and Texaco Inc., will reimburse the state and federal governments for past costs associated with preparing for the cleanup of the 22-acre McColl site.

While the settlement is a significant step in the complex litigation over the cleanup effort, the dispute over McColl is far from over. The oil companies are waging a countersuit to determine if the federal government should also pay part of the cleanup costs, which could reach $125 million.

"The U.S. EPA is pleased the oil companies have recognized their responsibility at this site," Jeff Zelikson, the agency's regional hazardous waste management division director, said in a prepared statement.

Under the settlement, the oil companies reimburse the government for the $18 million spent between 1980 and mid-1990 to secure the dump and explore cleanup options.

The EPA deemed McColl a major toxic problem in 1979, and added it to the federal Superfund priority list of toxic cleanup sites in September, 1983. A fence has been built around the area and a security guard is posted to keep out intruders while debate continues over how to proceed with the cleanup.

The site, in a once-remote area in Fullerton, is where about 100,000 cubic yards of petroleum waste were discarded in the 1940s, later to be covered by oil drilling muds and topsoil. Eventually, the area became part of the Los Coyotes Country Club golf course. In the 1970s the golf course was shouldered by homes, whose buyers complained of strong smells that caused headaches, and of black goo that oozed into their back yards.

Settlement terms order $13.25 million to go to the EPA and $4.75 million to the state to replenish the Superfund account to pay for cleaning up other contaminated sites.

"The settlement prevents the McColl site from becoming an expensive orphan that consumes millions of dollars from the state and federal treasuries," said William F. Soo Hoo, director of the California Department of Toxic Substances Control.

Participating in the announcement of the agreement were the U.S. Department of Justice, the U.S. attorney's office and the state.

The settlement figures, which were contained in a consent decree filed Thursday in U.S. District Court in Los Angeles, represent a compromise, according to EPA officials, who originally sought $25 million from the oil companies.

Greg Ritter, assistant regional counsel for EPA in San Francisco, said the agency is negotiating with McAuley LCX Corp., owner of Los Coyotes Country Club, to pay the $7-million difference.

Settlement negotiations between EPA and the oil companies began after the district court ruled in September, 1993, that the oil companies were legally liable to pay for cleaning up the wastes they deposited at McColl in World War II during the production of aviation fuel. Until then, the oil companies had denied responsibility.

Bill Duchie, spokesman for the oil companies, said Thursday that the firms will proceed with a countersuit contending that financial liability for the total cleanup should be shared by the federal government since the dump was created as part of the war effort.

Duchie said the oil companies agreed to put up funds for the past costs "because we want to move directly into the issue of what portion of liability can be assessed to the U.S. government."

If the federal government is found partly responsible, Duchie said, the oil companies will seek to recover a portion of the $18 million they have now pledged.

EPA and oil company officials contend that the legal wrangling over financial responsibility is not what has been delaying cleanup efforts at McColl.

However, A. Richard Olquin, spokesman for the Fullerton Hills Community Assn., which represents homeowners in the vicinity of the former dump, disagrees.

"The courts have had to force the parties involved to make decisions on paper about what should be done and the delay increases the cost. There is money being spent every day at McColl," Olquin complained.

As early as 1978, Olquin recalled, owners of homes abutting the dump site in Fullerton complained of odors and ooze emanating from 12 sumps filled with waste.

Over the years the EPA has evaluated and discarded a variety of proposed cleanup approaches, including removal and incineration of the waste, as too costly or hazardous.

In June, 1993, the EPA decided to go ahead with a plan to solidify and neutralize the waste by mixing it with a cement-like material, but feasibility studies of the process are still underway. Ritter said the oil companies, under orders from the EPA, are designing the cleanup effort. A large-scale field test of the procedures is scheduled in November. Ritter said he expects the cleanup to be completed in four to six years.

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