DES MOINES, Iowa (AP) — Titan Tire Corp. and Dico Inc. must pay millions of dollars in fines and penalties for the demolition of three buildings in Des Moines that the Environmental Protection Agency says were contaminated with PCBs, chemicals linked to cancer and considered hazardous.
The EPA sued the companies in October 2010 claiming they cost taxpayers millions of dollars to establish a Superfund cleanup site in Ottumwa where steel beams from the demolished buildings were dumped. The agency says Dico also should be penalized for flouting environmental regulations.
Dico owns industrial property near the Raccoon River west of downtown Des Moines. It was placed on the national priorities list of EPA's hazardous waste sites in 1983. The EPA in 1975 discovered the cancer-linked contaminant trichloroethylene in the Des Moines water supply and traced it back to the Dico property.
The EPA required construction of a groundwater treatment system at the site and other remedies. In addition, the agency said it found several banned pesticides including DDT on the property.
Dico once manufactured metal equipment, resold chemicals and formulated various pesticides and herbicides on the property. It currently has no ongoing business operation, generates no revenue and has a negative net worth of more than $5 million, the company said in court documents.
Dico was acquired by Quincy, Ill.-based Titan Tire in 1993 as part of its purchase of Dyneer Corp., and operates as an independent subsidiary.
PCBs were discovered in the insulation of five buildings on the property in 1992. Starting in 1994, the EPA required the company to cover the insulation and keep the PCBs from being released into the environment.
Dico complied and a final report was approved by the EPA in 1997. The agency, however, required Dico to continue to monitor and manage the property to avoid release of hazardous substances.
In 2007, Titan Tire entered a contract with Ottumwa company Southern Iowa Mechanical on behalf of Dico to tear down three buildings damaged in the flood of 1993, but didn't first notify the EPA. SIM dismantled the buildings and took the steel beams to its property in Ottumwa.
Court documents indicate some of the insulation in the buildings was taken to the homes of SIM employees for their personal use, which later had to be retrieved and disposed of.
The EPA determined the beams and the ground around them contained PCBs and ordered removal of the contamination in 2009.
Dico contends that the people acting on its behalf in selling the buildings to SIM did not know there was residual PCB contamination inside the buildings.
But in his order filed Tuesday, Judge Robert Pratt said the evidence shows Dico knew the buildings contained PCBs. He also said by allowing their demolition, Dico caused the release or threat of release of the chemicals into the environment.
"Dico's conduct with regard to the underlying events in this litigation is reprehensible and warrants a substantial penalty," Pratt wrote.
He ordered the company to pay nearly $3.1 million in fines and penalties.
"Motivated by a desire for a financial gain, Dico did not even make an effort to determine whether any state or federal environmental requirements applied to the disposal of the building debris resulting from this demolition," Pratt wrote.
As for Titan, he ordered that company to pay $1.5 million in EPA costs for cleanup of the Ottumwa property where the steel beams were dumped.
Pratt holds Dico and Titan Tire liable for ongoing costs incurred but not yet reported by the EPA, as well as all future response costs in connection with the Ottumwa site.
Titan Tire CEO Morry Taylor said, "We're going to appeal it and I think we'll win that thing on appeal."
Taylor claims the PCB amount in the buildings was insignificant and contained in tape on the back of insulation.
He said he likes the company's chances of winning a new trial.
"The next time we're going to drag everything in," Taylor said. "We're going to give everybody an education on just what happened."
Follow David Pitt on Twitter at https://twitter.com/davepitt .