Double Billing

Your company generated hazardous wastes. You took great pains to have it disposed of properly. The waste site was badly run. Now, the government wants you to pay the added price for cleaning up.

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IT IS ONE OF THE FAILINGS OF GOVernment that the terms of the environmental debate have been set by people who, in the end, have very little to say about whether the next generation of Americans will enjoy clean air and water. Based on the self-righteous pronouncements of the Sierra Club, you would be led inevitably to the conclusion that pollution is the by-product of uncontrolled corporate greed. On the other hand, were you to be guided only by the nostrums of the National Association of Manufacturers, you might conclude that overzealous enforcement of draconian environmental laws has spurred the decline of American capitalism.

As often is the case, the reality is so much more interesting than that. Between the tragedy of Love Canal and the comic farce of the snail-darter caper lies a vast field of economic and moral ambiguity. Simple questions -- How clean is clean? Whose fault is it that this well is polluted? -- do not lend themselves to simple answers. Heroes and villains turn out to be hard to find.

What follows is one chapter in the unfolding environmental story. It opens in New York State in 1970, an early moment in official environmental history. Up to that point, most businesses generating industrial wastes were in the habit of simply throwing their goop into local dumps or letting it collect in oozy lagoons. A new environmental awareness called those disposal techniques into doubt, and many companies responded in what would have been considered, at the time, a thoroughly responsible manner.

Among them was Schenectady Chemicals Inc. In the process of manufacturing synthetic resins, which are used in industrial processes, the company generated spent solvents in prodigious quanitities. Disposing of the substances in the most environmentally sound way -- by burning them -- was at least twice as costly as burying them in a nearby landfill. But it was a cost Schenectady Chemicals was willing to bear.

To burn its wastes, Schenectady Chemicals contracted with a company in Oswego, way upstate, with the high-sounding name of Pollution Abatement Services of Oswego Inc. (PAS). For two years, the company shipped to PAS 1 million to 2 million gallons of spent solvent. The cost of incineration came to $50,000 to $100,000 -- not a tremendous burden for a $30-million chemical company, but not exactly petty cash, either.

At around the same time, Alcan Aluminum Corp., an American subsidiary of a $6-billion multinational, had begun to rely on PAS in an even bigger way. Its 4 million gallons of rolling oil emulsion came from an Oswego plant that manufactures aluminum sheets for beer and soda cans. "We ended up at PAS the way most people did," says Alcan attorney Larry Salibra. "We called up the New York Department of Environmental Conservation [DEC] and asked where we should go."

Not all of PAS's customers were so large. Industrial Oil Tank Service Corp., in Verona, N.Y., for example, was a $1-million company in the business of cleaning out the residual sludge from the bottom of fuel tanks -- a brew of rust scalings and lead compounds. While many of its competitors were still dumping this mix at local landfills, owner John Hitchings decided to play by new rules, and inquired at DEC for possible solutions. PAS, with a state incinerator permit, was among the recommended companies, and with that assurance, Hitchings sent along 11 large drums of waste in 1974. The cost was about $10 a drum.

Jones Chemicals Inc., located near Rochester, N.Y., is in the business of repackaging chlorine for use in water purification. Back in 1973 and 1974, Jones ran a sideline business of using some of its trucks to transport waste for other companies, and in the course of pursuing this, Jones's trucks dropped off 21,000 gallons of somebody else's waste one day, as requested, at PAS's site in Oswego.

In time, these four companies, and dozens more, would come to learn much more about PAS. For rather than becoming simply customers, these companies were soon to become, in effect, PAS's environmental guarantors, responsible for its bad management, bad luck, and bad judgment. And instead of being regarded as law-abiding corporate citizens, they would find themselves branded by the government and the local press as environmental outlaws.

Pollution Abatement Services was the brainchild of three businessmen and an attorney who saw the possibility of a commercial bonanza in the growing public concern about hazardous-waste disposal. The four included an attorney, William Hoag; an electrical engineer, Norris D. Jones; an insurance agent, H. Willard Pierce; and a metallurgical engineer, Jack Miller. With years of metal-melting experience at Aluminium Company of America and Reynolds Metals, Miller was the moving force among the founders, and when their Oswego operation opened in 1971, it was Miller who served as its vice-president of sales and operations.

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