A company agreed to sell a major chemical manufacturing facility. The state environmental agency refused to transfer the water discharge permit to the buyer, due to the seller’s past and ongoing discharge violations. The state told the seller it would not transfer the permit without a corrective mechanism in place, enforceable as to the seller and the buyer.
Settlement with EPA and the State
The sale of the facility closed. The buyer began operating the facility, even though the permit was not transferred, and other alleged violations remained unresolved. EPA and the state brought enforcement action because of the discharge violations, failure to comply with the operation and maintenance provisions of the discharge permit, failure to follow the facility’s risk management program, and failure to comply with hazardous waste management regulations. Over one year after the buyer began operating the facility, the parties reached a settlement and filed a proposed consent decree.
Seller Pays Penalty, Buyer Implements Compliance Program
In the settlement, the seller agreed to pay a $2.4 million penalty, split evenly between EPA and the state. The buyer is a necessary party to the consent decree, which requires the buyer to hire a third-party environmental auditor and take specific actions to bring its water discharges and hazardous waste management into compliance; the buyer is responsible for stipulated penalties from not complying with these requirements.
The state agreed that the consent decree qualified as the corrective mechanism necessary for transfer of the water discharge permit.
To see EPA’s news release on the settlement, which includes a link to access the consent decree https://www.epa.gov/newsreleases/eastman-chemical-resins-inc-pay-24-million-penalty-multiple-environmental-violations