2020 Environmental Real Estate Issues

The US Department of Justice (DOJ) announced that Formosa Plastics Corporation, Texas will pay $2.85 million in civil penalties to resolve allegations its facility in Point Comfort, Texas violated the Clean Air Act (CAA).  Formosa has also agreed to upgrade its risk management program (RMP), with an estimated cost of at least $1.4 million.

Fires, Explosions and Accidental Releases
According to DOJ’s news release, Formosa had “a series of fires, explosions and accidental releases at the Point Comfort plant spanning from May 2013 through October 2016. These accidents caused injuries to workers, including second-and third-degree burns and chlorine inhalation requiring hospitalization, as well as property damage and the release of extremely hazardous substances to the environment.” DOJ also alleges Formosa “repeatedly failed to comply with the chemical accident prevention provisions” of the CAA.

RMP Requirement
The CAA requires facilities using certain hazardous substances to have an RMP that meets industry standards and other regulatory requirements.  Investigations triggered by Formosa’s fires, explosions and accidental releases led to allegations that Formosa’s RMP was inadequate.

In addition to correcting the alleged violations, Formosa agreed to engage a third-party auditor to review its RMP and correct any deficiencies found in the audit.

Value of Regular Audits
Regulatory requirements and industry standards continue to change.  Without regular audits, most facilities will not be able to achieve RMP and other regulatory compliance.  Texas facilities should have their audits done under the Texas Environmental, Health, and Safety Audit Privilege Act.

To see DOJ’s news release, which includes links to the Complaint and the proposed Consent Decree (which is subject to a 30-day comment period) https://www.justice.gov/opa/pr/texas-plastics-corporation-will-pay-nearly-3-million-violating-clean-air-act