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Libby Community Advisory Group
Meeting Summary

November 15, 2001

Introductions

Gerald Mueller and members of the Libby Community Advisory Group (CAG) and its guests introduced themselves. A list of the members and guests in attendance is attached below as Appendix 1.

Agenda

Mr. Mueller reviewed an agenda for this meeting including the following topics:

Public Comment

Community Superfund Experience

At the invitation of the CAG, representatives of four Montana communities or organizations shared their experience with Superfund National Priority List (NPL) designations.

Anaconda

Milo Manning, a retired Anaconda-Deer Lodge County official now associated with the Anaconda Environmental Education Institute, stated that he now acts as a technical advisor to the Anaconda Community Advisory Group. Mr. Milo showed a power point presentation illustrating the Anaconda Superfund site which was added to the National Priority List in 1983. The site consists of 16 or 17 operable units including the former location of the Anaconda Company copper smelter and associated facilities such as slag piles and the Anaconda and Opportunity tailings ponds. The contaminant that caused the NPL listing was arsenic, a carcinogen which was present in the airborne effluent from the smelter. The responsible party for the cleanup is ARCO, now BP-Amoco. The EPA standard for arsenic in soils for residential use was 250 parts per billion (ppb). Soil in the small community of Mill Creek, downwind of the smelter, had arsenic concentrations of 1,600 ppb. ARCO purchased all of the property in Mill Creek and covered and fenced the area to keep people out. ARCO has covered and seeded the slag piles and the Anaconda tailings pond. At the original smelter location, known as the Old Works, ARCO first covered the ground and constructed a Jack Nicklaus designed golf course. Mr. Manning said that representatives of the City-County of Anaconda-Deer Lodge sat at the table with EPA and ARCO when decisions were made about cleanup actions to ensure that the remedies were acceptable to the people of Anaconda. He recommended that representatives of the Libby community seek to participate in the cleanup decisions so that they will be acceptable to the Libby community. Mr. Manning stated that initially some resisted the Superfund designation, but after the cleanup began and data were developed on the effects of arsenic on children, the Anaconda community supported the cleanup.

Audience Member Question - Can you build on the Mill Creek site?

Answer - No. ARCO has placed deed restrictions on the Mill Creek site that prohibits residences and wells.

Butte-Silver Bow

Jon Sesso the Director of Planning for the combined City-County government of Butte-Silver Bow, discussed the experience of Butte-Silver Bow with the NPL designation. The primary problems in Butte are the Berkeley Pit mine flooding, exposed mine tailings on the Butte Hill, and water quality in Silver Bow Creek. The primary problem in Butte is surface water runoff into Silver Bow Creek. Initially, some leaders and members of the community feared that a listing would be the death knell for Butte. This fear proved groundless, and the Superfund designation has been to be good for the community for two reasons. First, although eight years passed before actual cleanup began and after fifteen years it is still not completed, Butte today is a safer community because of the cleanup. Mr. Sesso stated that local and state government would not have had the resources to pay for the cleanup, which ARCO is funding because of the Superfund designation. Second, Superfund activities have proven to be a corner stone of the community economy. The cleanup has provided jobs which helped ameliorate the loss of mining activities and the closure of the concentrator. Butte has attracted research money and developed a cleanup industry that markets its services world-wide.

Mr. Sesso made two recommendations to the Libby community:

1. Get involved and stay involved with the Superfund process, and be both patient and diligent to make sure you get your way in cleanup decisions.

2. Make sure that the land that is cleaned up and is put back into a productive use that serves the community.

CAG Member Comment - You said we should be patient. It has taken us two years already to get this far.

Response - Patience is needed because the scientists require time to decide on a lasting solution. You should not, however, tolerate unnecessary delay.

CAG Member Question - Did Butte have the press that Libby has had?

Answer - In Butte we have the Berkley Pit which currently holds 30 billion gallons of contaminated water, and the water level is rising at about one foot per month. Almost every major newspaper and news magazine has run articles insulting to Butte, basically saying we are fools for living there. We have not allowed the negative publicity from deterring us from the cleanup task and from pursuing our community development goals.

CAG Member Question - Did Butte and Anaconda face loss of life as we have in Libby?

In Anaconda, arsenic is a carcinogen with long-term effects. We have not faced the loss of life you have experienced here.

CAG Member Question - Does Butte have as a part of the Superfund a medical facility to treat affected people?

Answer - No.

CAG Member Comment - Thanks to all of you who came from other communities to share your Superfund experiences.

CAG Member Question - Have Butte and Anaconda obtained technical assistance as a part of the Superfund process?

Answer - So far Butte and Anaconda have received $200 thousand in four $50 thousand technical assistance grants from EPA. We have also received a grant from the Montana Resource Indemnity Trust which allowed us to hire a technical advisor who has translated the science and technical jargon into plain English.

Milltown Dam

Tracy Stone-Manning, Executive Director of the Clark Fork Coalition, a non-profit group headquartered in Missoula, reported on her group's experience with Superfund process and Milltown Dam. Milltown is a separate operable unit located on the western edge of the Clark Fork River Superfund site. Metals from the Butte and Anaconda mining and smelting activities have been deposited in sediment behind Milltown Dam. As a result, groundwater beneath the Milltown Reservoir is contaminated, so it cannot be used as a drinking water supply. The reservoir metal contaminated sediments also harm aquatic life and fish. In the Clark Fork River Superfund process, ARCO is the responsible party and conducts the cleanup studies and writes the documents which EPA and the public review. ARCO has written bad documents and has deliberating slowed the cleanup process. The situation here in Libby would be different. Because W.R. Grace is bankrupt, EPA, rather than the company, will conduct the studies and draft the documents. Two lessons from our experience are:

Technical assistance is needed so that scientists and engineers can be hired to translate the documents into language the community can understand.
Citizen involvement in the Superfund process has improved the cleanup.

East Helena

Joan Bowser and Jan Stetzer, both with the Lewis and Clark County Health Department, reported on their experience with the East Helena Superfund site. This site was listed because of lead pollution from the East Helena lead smelter. Soils in the yards of East Helena residences had elevated lead concentrations which were particularly hazardous to children and pregnant women. The smelter continued to operate for seventeen years after the NPL designation. While it operated, some of those whose livelihood depended on the smelter opposed the NPL designation. The smelter has now closed, and we expect an attitude switch from some who had previously been opposed. Based on our experience, the Libby community can expect the chance to work with EPA to develop and comment on cleanup plans. EPA has been responsive to our input. Because of the listing and the cleanup, East Helena has been the fasted growing area in the Helena Valley.

Libby Superfund Site

Ron Anderson reminded the CAG and audience that Libby has had a Superfund NPL site since 1983. Groundwater contamination from the wood treatment plant caused the listing. In 1979, a contaminated well was reported. In 1980, an investigation was started, and in 1983, the site was added to the NPL. The owner of the of the wood treatment plant claimed responsibility, did the studies, and compensated people who had been harmed by the contamination. The listing had no detrimental effect on the community.

CAG Member Question - Was creosote the groundwater contaminant?

Answer - The contaminants were creosote and penta (pentachlorophenol).

Audience Member Question - EPA is suing W.R. Grace to recover its cleanup costs. W.R. Grace can turn around and sue private individuals. What has been the experience of the other communities with third party law suits?

Answer - ARCO has behaved differently than W.R. Grace. The federal Superfund law incorporates the doctrine of joint and several liability. This means that EPA can hold any one of the responsible parties responsible for all of the cleanup costs, and the party paying can in turn sue the other responsible parties for their share of the cleanup costs. ARCO is solvent, and EPA is holding it accountable for all cleanup costs. ARCO, therefore, has the right to sue other responsible parties to recover costs of cleanup for which they were responsible. ARCO has sued Dennis Washington and other mining companies that were in the chain of title for the former Anaconda properties, but it has not sued any individual home or business owners. The City of Anaconda has accepted donations of land from ARCO on the condition that ARCO will not sue the City to recover cleanup costs. Milltown Dam is owned by Montana Power Company (MPC), and ARCO has threatened to sue MPC, but it hasn't done so. In East Helena, ASARCO paid cleanup costs, and has not sued any third parties to recover cleanup costs.

Comment by Wendy Thomi - EPA lawyer Matthew Cohn is researching contribution protection for third parties. EPA will share his results with the CAG.

CAG Member Question - Libby businesses have expressed concern about the impact of an NPL designation. Have good things flowed from the listing in other communities?

Answer - Yes. In Butte and Anaconda, we have been able to reuse formerly contaminated properties. Anaconda got a Jack Nicklaus designed golf course. In Butte, we have built a thirty-one acre sports complex, several ballfields, a visitor and transportation center, and various monuments to our mining past. We have also turned contaminated railroad corridors into walking trails. ARCO says that they have spent $700 million on cleanups to date in the Clark Fork basin. These expenditures stimulated the Butte economy. We have also received research dollars that have created an remediation industry in Butte. We do not believe that a NPL stigma has adversely affected the Butte economy. We have attracted ASiME, a large silicon manufacturing plant. The NPL designation and cleanup activities signal to companies that might choose to locate in Butte that we care about our community and are committed to its future.

CAG Member Question - Who paid for the sports complex and trails?

Answer - ARCO built them on the condition that the city-county government pay to maintain them.

CAG Member Question - Did the state fight paying the 10% share?

Answer - The 10% share applies to EPA cleanup costs. Because ARCO is paying for the cleanup, the 10% state share does not apply. Butte-Silver Bow wanted EPA to require ARCO to post a bond to ensure cleanup of the Berkley Pit which will not occur for several years, but because of BP-Amoco's financial strength, EPA chose not to require one.

Audience Member Question - Without EPA would you have had the same results from ARCO?

Answer - No. We needed the EPA-Superfund stick.

Superfund Mortgage Issues

Jim Raznoff, Environmental Coordinator for US Department of Agriculture, reported on USDA loan programs and Superfund. USDA has around 100 grants and loans outstanding in Lincoln County and about 100 loan guarantees through Glacier Bank. USDA is vigilant about the real estate market. USDA follows rather than leads the market. A Superfund NPL designation does not introduce extraneous loan factors. The East Helena, Butte, and Anaconda Superfund sites have not resulted in changes to home lending practices or requirements.

Jane Foley with Glacier Bank in Libby stated that her bank will remain here and continue making loans if the community is designated a Superfund site.

Dick Brinck, State Coordinator for the US Department of Housing and Urban Development (HUD), said that he has read statements to the effect that HUD would stop making loans. This is not correct. HUD has about $100 million in loans in the Libby area, and has no intention of walking away from the Libby community. If HUD did so, it would damage its outstanding loans. Mr. Brinck stated that an NPL designation would not add any requirements that would slow down the loan process. HUD's only concern is buyer awareness. We would want to make sure that a buyer knows what is going on regarding any cleanup. Mr. Brinck then responded to the following questions that Wendy Thomi had received from members of the Libby community:

1. Would HUD mortgages have new conditions because of a Superfund designation?
Answer - No. We would only want the buyer to be aware.

2. Would the mortgage be subject to the same standards given a Superfund designation?
Answer - Yes. Loan standards would not change because of a designation.

3. Would a Superfund designation cause perception of a high risk resulting in a declining market?
Answer - HUD mortgages follow rather than lead the market. Market price is set by supply and demand, not perception of risk because of a Superfund designation. Home values in East Helena have increased even though it is an NPL site.

4. What is the process for getting a property cleared for government backed financing once the home/property is declared a Superfund site?
Answer - There is not a clearance requirement for our financing.

5. Although HUD may give a loan, won't Superfund reduce the willingness of the secondary mortgage market to purchase loans?
Answer - HUD guarantees loans for the full value of the mortgage. Because its loans are backed by the US government, HUD is a strong stabilizing force. We bring money into a community. We cannot predict what the secondary market for conventional loans will do.

6. Do I have to disclose vermiculite on property I am attempting to sell?
Answer - HUD has no disclosure requirement. State law requires disclosure of hazards.

7. Would a Superfund designation decrease the value of Libby homes?
Answer - A Superfund designation hasn't decreased home values. A declining economy and lost jobs reduces home values. Home prices are set by supply and demand.

8. Would a Superfund designation affect my ability to refinance my current mortgage?
Answer - Whether one can refinance depends on the value of one's home. If the value drops below the mortgage amount, then refinancing would be difficult. Again, value is set by supply and demand.

CAG Member Question -Is there a form 11G that requires vermiculite disclosure?

Answer - The standard uniform appraisal form requires that special conditions of the property be disclosed. An appraiser may require work to be completed before a sale.

CAG Member Question -Who is here tonight representing local Realtors?

Answer - We apparently don't have any in the audience tonight, but we had quite a few at the meeting this afternoon.

CAG Member Question - So vermiculite insulation won't prohibit mortgages?

Answer - Vermiculite insulation, in of itself, would not prevent government-backed loans. Conventional loans without government backing might be affected. It is, however, rare for any single factor to prevent mortgage loans. HUD will follow EPA's technical lead, and will not make independent hazard designations.

Audience Member Question - If I have an $80,000 home that is dripping with vermiculite can an appraiser require a $10-20,000 cleanup before I can sell it?

Answer - Appraisers will note problems that will affect loan values. Sometimes repairs may be required.

CAG Member Question -Have houses in Libby been sold recently?

Answer - Yes. Disclosures have been made, but the sales have gone through. Financing was not a problem.

Audience Member Question - Who makes the determination that vermiculite insulation is a health hazard?

Answer - If you are refinancing or buying or selling a house, EPA will sample the insulation and soils. Four weeks may required to get test results. Vermiculite insulation is not always contaminated. If you have an older home, you can assume it is contaminated. You can also assume contamination is present if the vermiculite came from the Libby mine. If the insulation is not disturbed, there is no health risk. EPA is headed in the direction of removing vermiculite insulation from Libby homes, but the final decision will not be made for another couple of months.

CAG Member Comment - Vermiculite insulation is a hazard if it is disturbed.

Respone - Yes.

CAG Member Question - Can Realtors request sampling by EPA?

Answer - Yes, but with winter approaching, outside sampling may not be possible.

Audience Member Question - If EPA has tested the insulation in my home, and no asbestos was detected, can I dispose of the insulation in the county landfill?

Answer - Even if no asbestos was detected, do not haul it to the dump because others may then want to do the same. Wait until the decision is made about the new landfill cell that can take asbestos contaminated material.

CAG Member Question - Would an EPA commitment to cleanup and insulation removal make loans more attractive to lenders?

Answer - No. Credit is based on history, not on any future expectation. Value is in the mind of the purchaser.

CAG Letter of Support for EPA-W.R. Grace Settlement

Gayla Benefield asked the CAG to send a letter to EPA in support of the settlement reached with its court case against W.R. Grace that would obligate W.R. Grace to contribute $2.75 million for asbestos-related medical costs in Libby.

CAG Action - The CAG agreed unanimously to send a letter of support for the settlement and drafted by Sandy Wagner (see Appendix 2). CAG members signed a signature page to accompany the letter.

Public Comment

Audience Member Question - When will EPA present its paper on the NPL designation to Governor Martz?

Answer - We expect to send a letter to Governor Martz during the first or second week of December. We hope to receive her letter of concurrence or non-objection about thirty days later, towards the end of January.

CAG Member Question - Assuming our Governor sends her letter then, when would EPA initiate the listing?

Answer - EPA would issue a special rule initiating the NPL decision process in February 2002.

CAG Member Question - Assuming the rule making begins in February 2002, when would the listing decision be finalized?

Answer - The normal process might be completed in January or February 2003. Court appeals might delay this date.

CAG Member Question - If the Governor exercised her silver bullet selection, how much time would be saved?

Answer - Around a year, which is why EPA hopes the Governor will use the silver bullet option.

Comment by Duc Nguyen - Remember that the listing decision does not guarantee funding for removal of the vermiculite insulation from Libby homes.

Next Meeting

The next meeting is scheduled for Thursday, December 13, 2001 7:00 to 9:00 p.m. in the Ponderosa Room of Libby City Hall.

Appendix 1

CAG Member Attendance List
November 15, 2001

Members

Organization Represented

Don Wilkins

Lumber & Sawmill Workers

Robert H. Foote

Libby Ministerial Association

Gayla Benefield

LCAVRO

Sandy Wagner

Lincoln County Community Health Center

George Keck

Community Health Center

Rep. Eileen Carney

State Representative

Wendy Thomi

EPA Community Involvement

David Latham

The Montanian Newspaper

George Bauer

City of Libby

Bob Dedrick

Asbestos Victim

Dr. Brad Black

Lincoln County Health Officer/CARD

Clinton Maynard

Area Asbestos Research Group

Ron Anderson

Lincoln County

Cyrus Lee

Kootenai Valley Head Start

Rick Palagi

St. John's Lutheran Hospital

Leroy Thom

Former Grace Employee

Duc Nguyen

EPA On Scene Coordinator

Mike Switzer

Asbestos Victim

Norita Skramstad

Asbestos Victim

Kerry Beasley

St. John's Lutheran Hospital

Guests

Group/Organization Represented

David Williams

EPA NPL Coordinator

Jan Stetzer

Lewis and Clark County Health Department

Joan Bowser

Lewis and Clark County Health Department

Jim Raznoff

USDA Rural Development

Dick Brinck

US Dept. HUD

Jane Foley

Glacier Bank

Gary Spencer

Glacier Bank

Tracy Stone-Manning

Clark Fork Coalition

Jon Sesso

Butte-Silverbow Local Government

Milo Manning

Anaconda Technical Advisory Group and Anaconda Environmental Education Institute

Appendix 2

November 15, 2001

Chief Environmental Enforcement Section
Environment and Natural Resources Division
U.S. Dept. of Justice
P.O. Box 7611
Ben Franklin Station
Washington, D.C. 20044-7611

RE: DOJ Case No. 90-11-2-07106/1

Dear Sir:

For the past two years the Libby Community Advisory Group, a diverse cross section of the Libby community, have worked diligently to find avenues by which this community could comprehensively address the profound health care needs of our citizens diagnosed with asbestos related disease.

To date only a handful of the personal injury suits filed against W.R. Grace have reached settlement. Having now filed for bankruptcy protection, it is fairly safe to assume that the cases that remain within the judicial system will never be settled in a fair and equitable manner and hundreds of persons will never have the opportunity to seek any kind of medical reimbursement recovery. The current Libby Medical Plan funded and regulated by W. R. Grace could go away tomorrow and furthermore, there are several severe coverage gaps within the current plan.

The Federal Government has now completed its screening commitment to Libby and any further testing costs will have to be absorbed by the State of Montana and the local community. Given Montana's current economic situation, the access to monies needed for an going screening program are not likely further leaving many of our friends, neighbors, and family members at great risk.

Our local medical providers and hospital are going to be confronted with the daunting task of providing extensive medical care for many persons with a limited ability to pay to the escalating cost of intense treatment for asbestos related disease.

For the reasons outlined above, it is the consensus of this advisory group that the consent decree as outlined in Civil Case #00-167-M-DWM should be approved and its terms and conditions implemented at the earliest possible date.

Sincerely

Signature Page Attached


Photos courtesy of Dudley Dana, Dana Gallery