Air Date: Week of June 19, 1998

Desperate for jobs, a small community embraces a potentially dirty industry which other towns might turn away. Promises of a clean operation are broken, and the town ends up with far more than it bargained for. It's an old story, but one that’s taken a new twist in an isolated corner of North Dakota. There, in the small city of Williston, local and state governments became financial partners in a company which built an incinerator to recycle hazardous oil refinery waste. As environmental problems mounted, regulators seemed to do little to address them. Before long, the company collapsed, leaving a legacy of toxic waste, bad debt, and environmental crimes. Eric Whitney of the High Plains News Service reports.

Transcript

KNOY: It's Living on Earth. I'm Laura Knoy. Desperate for jobs, a small community embraces a potentially dirty industry, which other towns might turn away. Promises of a clean operation are broken and the town ends up with far more than it bargained for. It's an old story, but one that's taken a new twist in an isolated corner of North Dakota. There, in the small city of Williston, local and state governments became financial partners in a company which built an incinerator to recycle hazardous oil refinery waste. As environmental problems mounted, regulators seemed to do little to address them. Before long the company collapsed, leaving a legacy of toxic waste, bad debt, and environmental crimes. Eric Whitney of the High Plains News Service reports.

(Children yelling)

WHITNEY: Kids linger on the playground before heading home from McVeigh Elementary School in Williston, North Dakota. Rising beyond the monkey bars less than a mile away is the slender smokestack of Dakota Catalyst Products, leaning crookedly on guy wires.

HAUSER: When the plant was operating, especially there just before it shut down, we noticed quite a large amount of emissions coming off there as black smoke.

WHITNEY: Dave Hauser is the principal of McVeigh Elementary.

HAUSER: The plume was very long and black, and that's when our kids were experiencing a reddish in the eyes and hurting a little bit, irritation in the eyes, that's basically what it was. Especially when the wind was coming right across our playground.

PALMER: What exactly were the emissions?

WHITNEY: Julie Palmer was among the first Williston residents to start asking questions when her daughter Brittney started coming home from school with teary eyes and sick to her stomach. But she didn't get many answers.

PALMER: Up to this point we'd been told by not only Dakota Catalyst but the state health department, the bottom line is we don't know what's in the emissions.

WHITNEY: Today, Dakota Catalyst is shut down, bankrupt and facing stiff fines for environmental crimes. But Williston residents still don't know what was in that plume and why, for too long, no one who could seemed interested in finding out.

(Traffic sounds)

WHITNEY: Few complained when Dakota Catalyst came to this small city on the banks of the Missouri River 7 years ago. It promised good jobs doing good work, recycling toxic oil industry waste into valuable products. The company brought 60 new paychecks to a town still reeling from the region's oil bust of the 1980s. Founder Robert Howard remembers getting a warm welcome.

HOWARD: It was really an ideal business start in that you had the city, Williston, as an investor. You had an unbelievable level of cooperation between the city, the state, and the Federal government. It was a textbook case of cooperation between the city, the state, and the Federal government.

WHITNEY: The city of Williston and the state of North Dakota both became part owners of Dakota Catalyst. The city invested $100,000; the state invested $600,000. Economic incentives to new businesses are common in this remote state, so it wasn't until things began to go wrong that this financial relationship raised any eyebrows. The problems began with air quality violations inside the plant itself. Then, rail cars full of hazardous waste were found to be leaking into groundwater. One day, a foul-smelling gas cloud leaked from the doors of the building, blanketing the town and nauseating dozens of residents. And then there was the smokestack plume. Company officials blamed the mounting troubles on financial problems. The state issued a few reprimands for minor pollution violations, but said there was no reason to be concerned about the plant's emissions.

WRIGHT: Thank you all very much for coming this evening. My name is John Wright. I'm the director of the North Dakota Department of Health...

WHITNEY: But angry residents weren't convinced. When state officials called a meeting to address residents' concerns, they were nearly shouted off the stage.

MAN: We are sick and tired of this. (Many other people shout) Let's get to work!

WHITNEY: Not long afterwards the pressure cooker burst. Without warning, Dakota Catalyst laid off most of its workers and shut down. Two weeks later Federal investigators descended on the plant, surrounded it with armed guards, and started carting off boxes of documents and scores of chemical samples.

(Wind and rain)

WHITNEY: Today, cold prairie rain batters the lifeless Dakota Catalyst plant. A year after the raid, few details of the investigation have emerged, but enough to confirm the fears of many residents. Federal agents have told a court that they believe Dakota Catalyst brought illegal hazardous waste to Williston and then illegally re-labeled it as non-hazardous. Former company president Rob Howard, who was forced out before the shutdown, believes Dakota Catalyst took the waste in a desperate attempt to generate cash. And Bill Dellmore, a former North Dakota assistant attorney general familiar with the case, says the substances involved were definitely bad news.

DELLMORE: It was clear from after the fact they were burning inappropriate material. We've got some wastes out there that we believe are hazardous for arsenic and were hazardous for benzene. And high levels of those and we're starting to get into some minerals: the cadmiums, and chromiums and leads. Those were not the kinds of materials that they originally in their application and the original test had to do with.

WHITNEY: The evidence gathered so far has been enough to push Dakota Catalyst to strike a deal with the government. The company recently pled guilty to 2 criminal charges: storing unpermitted hazardous waste, and dumping a truckload of benzene-contaminated water into Williston's wastewater system. And it's been fined $700,000. But for local residents, big questions remain. Primarily, whether the state's financial relationship with Dakota Catalyst led it to overlook serious problems.

(A beeper sounds; hinges)

WHITNEY: Andy Anderson, who owns a store across the street from the plant, says financial deals and the town's desperate straits at least led to a lot of wishful thinking.

(Noises and conversation in the background)

ANDERSON: A lot of people wanted it to work out, and as a result nobody wanted to be the bearer of bad tidings when it didn't work out exactly like it should. There was a lot of money coming from a lot of different places, and Lord only knows what it all really meant. And what it really took to make people aware of it.

WHITNEY: There is no evidence that the state's financial investment led to pressure on the health department to go easy on Dakota Catalyst. But even the department's former head, Dr. John Rice, admitted that his office wasn't interested in getting really tough with the company.

RICE: It's a business that makes sense, to us makes sense as a recycling business. And so we encouraged the business to continue to function and to make money it needs to continue to operate and to make product. And so we did encourage it to continue...

WHITNEY: Meanwhile, until the criminal investigation began, the Federal government wasn't watching very closely either. The Environmental Protection Agency had given Dakota Catalyst an exemption from Federal hazardous waste laws because the operation was supposed to be recycling the waste rather than disposing of it. Rich Fortuna, a hazardous waste industry consultant and critic of the EPA, says Dakota Catalyst was an accident waiting to happen.

FORTUNA: I think Dakota Catalyst is an example of where everybody's been asleep at the switch from EPA to the state and whatever. Dakota Catalyst is a harbinger of things to come, and is one example of a broader problem that's occurring with increasing frequency throughout this country, which is communities being victimized by bad recyclers because of EPA's inattention to the dark side of recycling.

WHITNEY: But to Julie Palmer, the second-guessing, and even the company's guilty plea, are little solace. She scoffs at the $700,000 fine assessed on a firm that's already bankrupt. And she worries that even though the plume is gone, its effects could linger.

PALMER: We as individual citizens who have lived through what that plant put us under. May not know for many years the ramifications to our health. I feel like I have a cloud hanging over me.

WHITNEY: For the time being, Julie Palmer continues to watch the clean-up of the polluted site. But she says she's worried about talk that new investors may buy the Dakota Catalyst plant. If it ever starts up again, she says, she'll probably just pick up and leave town. For Living on Earth, I'm Eric Whitney in Williston, North Dakota.