The California Department of Toxic Substances Control is behind schedule on the cleanup of thousands of Los Angeles County properties contaminated with lead dust and will need to spend $390 million more than what it has to complete the work, according to a state audit released Tuesday.
The report by the State Auditor’s Office concludes the “state’s poor management” of the cleanup related to the Exide battery recycling plant in Vernon has left thousands of Californians at risk of lead poisoning. Lead contamination can lead to cancer, developmental disabilities and other harmful neurological effects.
“Despite the importance of removing lead contamination, we found the DTSC’s cleanup efforts are behind schedule,” wrote Elaine Howle, the state auditor, in a letter to the governor and state legislators. “We are particularly concerned that DTSC has not removed contaminated soil from a total of 31 school, childcare facility, and park properties, even though it had available options for cleaning those sites.”
Sites were first identified as contaminated from 2014 to 2017. Limited resources for contracting, a focus on other priorities, and mistakes in identifying ownership of the properties led to the delays, according to the audit.
DTSC’s inaction “continued to put the children and other at-risk individuals who spend time at these properties at unnecessary risk of the serious consequences of lead poisoning,” the audit determined.
Top priorities
In response to the audit, DTSC Director Meredith Williams said the agency is now prioritizing removal of toxic soil at the facilities used by children. DTSC previously oversaw such work at 17 day-care centers and seven schools. Since June 2020, the process has begun at another eight day-care centers, she said.
The audit indicates DTSC still will likely miss its target date of June 2021 to finish cleaning 3,200 of the most contaminated properties in the area. The state agency does not have a timeline or a price tag for another 4,600 affected properties.
“The department’s poor cost estimation and cost overruns by one of its contractors have contributed to DTSC spending more than expected to clean the contamination,” Howle wrote. “At current spending rates, we estimate that DTSC will need about $390 million more than it has been allocated to date to completely clean all 7,800 contaminated properties.”
The Legislature provided $260 million to DTSC for the cleanup, but the audit estimates DTSC will need to spend $630 million to complete the entire project. DTSC failed to account for inflation, prevailing wages and other costs that should have been expected in its original plan in 2016, the audit found. One contract did not have adequate protections for cost overruns and resulted in spending $17 million more than anticipated.
‘Significant questions’ about funding
A U.S. Bankruptcy Court’s approval of Exide’s bankruptcy earlier this month leaves “significant questions about the state’s ability to obtain reimbursement for the cleanup,” Howle added.
It would take DTSC until 2028 to finish all 7,800 parcels at the average pace of roughly 16 properties per week, according to the audit. That pace increased to 24 properties per week in September, according to Williams’ response.
She added that “only one other site in the nation exceeds the size of DTSC’s residential cleanup, which is the largest, most logistically complex residential cleanup project the state of California has ever undertaken.”
DTSC is undergoing a comprehensive update of its estimates and expects to use the new figures to pencil out the cost of the other 4,600 properties with lower contamination levels, Williams said.
DTSC: Mistakes were made
She acknowledged the agency has made mistakes over the years. DTSC accepted every recommendation from the State Auditor’s Office. The Auditor’s Office, however, noted that no proof has been provided that the recommendations have been implemented.
“DTSC has an ongoing commitment to improve the cleanup by learning, from other experts, from people in the communities we serve, and from our mistakes,” Williams wrote in her response. “Any entity that claims perfect implementation of a large, unique, and challenging project like this residential cleanup isn’t truly assessing its performance.”
The Exide plant in Vernon recycled 11 million lead-acid batteries a year until it was forced to shut down in 2015 in exchange for a nonprosecution agreement by the federal government. Exide admitted to spreading lead and arsenic into neighboring communities and pledged to deal with its mess, but did not follow through with its promise, according to DTSC. The company filed for bankruptcy in May 2020 and was given permission to abandon the Vernon site as part of the deal.
State appeal pending
California’s efforts to challenge that decision have so far been unsuccessful, though an appeal is still pending.
A federal judge recently denied the state’s emergency motion to stop the bankruptcy, forcing state officials last week to concede to forming an environmental trust, to be formed by Exide and managed by a cour-appointed trustee, that will oversee the property once Exide is dissolved.
The trust will have about $30 million to work with, a far cry from the $70 million to $100 million needed to safely demolish and stabilize the property. That money is separate from the spending on the residential work.
In 2016, the state Legislature placed a $1 fee on each battery recycled to support a cleanup fund. The fee is expected to increase to $2 per battery in April 2022 and generate about $30 million per year, according Assemblywoman Cristina Garcia, the bill’s sponsor.
In a statement, Garcia said the audit confirmed the public’s concerns that DTSC did not have a proper plan to ensure homes were cleaned. The Bell Gardens Democrat said the lack of urgency around cleaning up schools, parks and day-care centers is “maddening.” However, she urged the state to continue funding the much-needed work using the recycling fee.
“DTSC must have a clear plan of how it will put the Lead Acid Battery Fund to work to ensure we don’t leave any families behind,” she said in a statement. “The state should not wait for the battery fee money to come in to the state, instead it should loan DTSC money to keep the cleanup going, and the battery fee can repay the loan once the funding from the battery fee has been collected.”
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California behind schedule, $390 million short on Exide cleanup, state audit finds - LA Daily News
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