JANUARY 2009

Environmentalists have Schnitzer Steel scrap yard in their sights
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Toxicity of storm water runoff from scrap yards can be extremely high and regulations are extensive.

Environmentalists have Schnitzer’s scrap recycling yard in their sights, arguing that it pours polluted storm water into the Willamette River. At the site, scrap metal sits in large piles close to the river bank. Rainwater allegedly washes pollutants into the river.

Environmental activists are going after Schnitzer Steel’s giant scrap yard on the Willamette River, saying regulators have allowed rainwater with high levels of heavy metals to run from the property into the river for years.

The Northwest Environmental Defense Center sent a notice to the Portland company – one of the world’s largest metals recyclers – accusing it of violating the federal Clean Water Act. The center, based at Lewis & Clark Law School, has a long history of successfully targeting Oregon industries.

Schnitzer’s own tests on water draining from scrap yard storm-water pipes show levels of copper, lead and zinc above state benchmarks since at least 2001, the center said, with the numbers getting worse in recent years.

The company’s sampling in November 2007 and February 2008 found 22 instances in which pollution was at least double the state benchmark, records show, with zinc 29 times higher at one of the scrap yard’s stormwater outfalls in November.

Contaminant levels in the more recent results, and in the environmental center’s own sampling last month, are at the highest levels the center has seen for Oregon industrial storm water, said Mark Riskedahl, the center’s director.

The Schnitzer property, north of the St. Johns Bridge on the Willamette’s east side, also sits in the Portland Harbor Superfund site, and the contaminants in its storm water are among the toxins that Superfund managers are trying to remove from river sediment. As with other long-operating industrial sites, tests have found toxic PCBs – a long-banned industrial insulator – in Schnitzer’s storm water.

“There needs to be some flexibility (in controlling storm water). I understand that,” said Riskedahl, who hopes to negotiate a settlement with the company. “But we’ve given Schnitzer time, and the pattern is going the wrong way. Something needs to happen.”

Schnitzer officials declined to comment, citing potential litigation. But the company, which prides itself on its recycling legacy, has taken steps to reduce stormwater pollution, and records indicate it plans to do more.

Last year, it spent $14 million installing a new metal shredder and stormwater collection and storage system. The system collects storm water from about a tenth of the site, stores it in a million-gallon tank and cleans it, reusing it to help cool the shredder.

Records from Portland’s Bureau of Environmental Services, which handles the permit on behalf of the Oregon Department of Environmental Quality, indicate the company plans to install swales by the river to capture and filter stormwater, and perhaps a more elaborate system to contain and treat storm water from the entire site. The timing for its plans are unclear.

DEQ officials said they’re talking with Schnitzer about improvements, and the company appears ready to take a “proactive” approach. “Something’s going to need to be done,” said Jim Anderson, DEQ’s Portland Harbor project manager. “And it’s got to be better than what they’re doing now.”

Oregon’s five-year permits give companies four years to get below state pollution benchmarks, and companies must submit “action plans” if they exceed the benchmarks before the fourth year. But they’re given leeway to try different approaches to control pollution before stricter water-quality limits kick in, even if they’re chronic violators.

The scrap yard, which Schnitzer bought in 1972, is one of 35 the company operates nationwide. It was a shipyard in World War II and an oil storage terminal before that, likely contributing to the PCB contamination.

The yard collects scrap metal – from industry, auto salvagers, railroads and metals dealers – then cuts it down to size and ships it to steel mills, including Schnitzer’s Cascade Steel mill in McMinnville. The company said it recycled 6.2 million tons of ferrous metal in 2007.

But scrap yards pose one of the biggest stormwater pollution risks, Riskedahl said, and from a kayak on the Willamette, it’s easy to see why. Earlier this week, mountains of scrap were piled high close to the river. Regulators say shredding steel scatters metal dust throughout the property. Sixteen pipes jut out from the rock-lined banks to release storm water.

In a filing with the city in March, Schnitzer officials said some of the scrap yard’s sand filters – placed along the riverbanks to help capture storm water – are no longer effective. Swales or perhaps a more effective, and more expensive, closed-loop treatment system could take care of that problem, regulators said.

Schnitzer, which reported $126 million in income for the quarter ended in August, posted $26.7 million in environmental liabilities for its metals recycling business on its 2008 balance sheet. It’s unclear if planned spending on the Portland yard is part of that amount.

Metro Metals Northwest, a Schnitzer competitor, recently finished installing a $1.6 million closed-loop system at its scrap yard along the Columbia Slough. The system captures all the stormwater on the site, stores and treats it, company president Victor Winkler said.

The Environmental Defense Center prodded Metro Metals, but Winkler said the company went well beyond regulatory requirements. “We did this so we won’t have to do anything again,” he said, “so we’re 20 years ahead of our competitors.”

—Reprinted with permission from The Oregonian