The agreement approved late Wednesday calls for Exide to close a facility that, according to the government, produces a host of hazardous wastes, including lead, cadmium, arsenic and volatile organic compounds.
"The reign of toxic lead ends today," said Acting U.S Attorney Stephanie Yonekura. "After more than nine decades of ongoing lead contamination ... neighborhoods can now start to breathe easier."
Exide had planned to resume operations at the recycling facility as early as next month, but the agreement calls for the facility to be shuttered, demolished and cleaned up. The company is also required to expedite the funding of a $9 million trust fund that will be used to clean up 216 nearby residences in Boyle Heights and Maywood.
Robert M. Caruso, Exide's president and chief executive officer, said he recognizes "the impacts that closing the Vernon facility will have on our approximately 130 employees and their families. On behalf of the company, I thank them."
The deal to close the recycling plant is contained in a non-prosecution agreement, or NPA, that Exide and prosecutors finalized late Wednesday.
The U.S. Attorney's Office in Los Angeles estimated that Exide's direct costs of compliance are well in excess of $100 million, including the company walking away from recent improvements to the facility and incurring new costs for lead and plastic that must now be purchased to manufacture new batteries.
Prosecutors said it entered into a non-prosecution agreement because negotiations with the bankrupt company revealed that just the threat of criminal charges would almost certainly force its liquidation, leaving government agencies responsible for cleaning up the Vernon plant.
The NPA also opens the door to new funding for the company, which employs thousands of workers in the United States and around the world, prosecutors said.
"The agreement with Exide ensures that the Vernon site will be permanently closed, while guaranteeing that the company will survive to adequately finance the clean-up of this long-suffering community," Yonekura said.
Rep. Lucille Roybal-Allard, D-Los Angeles, said it was "regrettable" that Exide avoided criminal prosecution, but "at least the plant is now permanently closed. I hope authorities can swiftly complete the decontamination of the site and its surrounding communities."
"I have been greatly concerned about the health hazards that the Exide plant poses to my constituents, and that is why I have been a vocal supporter of the plant's closure," she said. "While I recognize Exide had made efforts to update the facility's air pollution control systems and complete renovations, the reality is that it was too little too late. Given Exide's history, there was little reason to believe in its promises of corrective action."
Jared Blumenfeld, EPA's Regional Administrator for the Pacific Southwest, said the closure of Exide "is a victory for the residents of Vernon who have suffered from decades of toxic pollution."
"Today's announcement shows that companies who fail to meet federal environmental laws will face serious consequences," he said.
Bell Mayor Nestor Enrique Valencia said Exide's contamination of the environment "is inexcusable and will continue harming us for years to come," adding that a new hospital specializing in cancer and birth defects should be part of any settlement.
In addition to the commitments to close the Vernon facility and pay for associated clean-up costs, Exide has acknowledged criminal conduct, including the illegal storage, disposal, shipment and transportation of hazardous waste.
In the NPA, Exide admits that it "knowingly and willfully caused the shipment of hazardous waste contaminated with lead and corrosive acid" in leaking van trailers from Vernon to Bakersfield and did so "a significant number of times over the past two decades, in violation of federal law."
Each incident could be charged as a felony violation of the federal Hazardous Materials Transportation Act, according to the document.
Prosecutors said the admissions of criminal violations were important because Exide agreed that it could be prosecuted at any time over the next 10 years if it fails to abide by the terms of the NPA.
A violation would include failing to adequately finance clean-up efforts at the recycling facility, a program that will be overseen by the California Department of Toxic Substances Control.
DTSC Director Barbara Lee said the department's priority is to ensure the safe closure of the Exide plant and to complete the cleanup of contaminated yards in the surrounding neighborhoods.
She said the department's decision to close the plant was based on such factors as Exide's inability to meet safety standards, failure to certify the structural integrity of a containment building used to hold hundreds of tons of lead, and poor history of compliance with environmental and health protection laws.
"DTSC will use every tool and legal mechanism at its disposal to ensure that Exide's remaining resources are used to properly close the facility and clean up contamination" in nearby neighborhoods, Lee said.
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