WASILLA -- A Mat-Su Borough-ordered environmental audit of 22 acres of Port MacKenzie land leased by the wood chip company NPI recently discovered oil contamination and other possible environmental violations by NPI and a company subleasing the property.
Deep petroleum soil staining in many areas, spilled oil containers, sedimentation of wetlands, piles of trash and the lack of secondary spill containment equipment for an above-ground oil tank were among violations listed.
Borough officials, who became aware of the violations July 20, met Thursday to outline a plan of attack for dealing with them and notifying the Alaska Department of Environmental Conservation of the inspection results.
The audit was conducted by Travis/Peterson Environmental Consulting Inc. of Anchorage at the request last year of the Mat-Su Borough, which owns the land. It's the first such inspection of the port's industrial area since activity there began about 10 years ago. Borough officials wanted to get an idea of the condition of the property before the area becomes busier, Patty Sullivan, borough public affairs director, said Thursday.
NPI, one of the borough's main tenants at the port since 2001, operates a scale house off Lou Young Road in the lower portion of the property within one-quarter mile of the port shore and stores heavy equipment on the site.
Klondike Concrete of Chugiak has subleased part of that property from NPI for the past three years, importing cement from China for state construction projects. Klondike built a warehouse there to store sacks of cement, according to the audit.
In Travis/Peterson's report, which the borough received July 20, scientists noted: "Many areas observed with deep petroleum soil staining. Observed oil containers knocked over. Found an open drum with spent oil filters. Observed areas where equipment oil was drained on the ground. Storm water is carrying sediment away from the pads and into wetlands."
To be in compliance with the federal Clean Water Act and the Alaska Pollutant Discharge Elimination System regulations, both NPI and Klondike should be operating under a Multi-Sector General Permit and have a list of places where discharges to water sources occur, with detailed pretreatment measures or reports. Such permits and reports were not evident to Travis/Peterson inspectors, the audit states.
Also missing was any evidence of water sample tests required by the Alaska Department of Environmental Conservation on Klondike's Class C public water system, the audit said.
TRASH, DEBRIS, OPEN DRUMS
The Travis/Peterson report hit borough offices at about the same time the borough was settling a three-year legal battle NPI had waged against the borough alleging breach of contract. NPI argued that canceled timber sales on borough land undermined its business.
That lawsuit ended with the borough paying NPI $1.1 million in cash and $1.3 million in lease credits for future wharf and dock fees. In return, the borough eliminated NPI's right of first refusal to lease nearby borough land, which gives the borough more power over future dock users.
The settlement doesn't address soil contamination and other issues identified in the Travis/Peterson audit.
Borough Attorney Nick Spiropoulos said Wednesday the borough wasn't even aware of NPI's alleged environmental issues at the port during that settlement.
"One has nothing to do with the other," Spiropoulos said.
Other observations made by Travis/Peterson include piles of trash and metal debris scattered and partially buried on dock property. Two 5-gallon buckets of lube oil next to the Port MacKenzie dock also were found.
"Given the quantity of open and used drums around site, the property may be in violation of the (federal) Resource Conservation and Recovery Act," the report states. "To determine RCRA compliance, the contaminated media must first be analyzed by a qualified laboratory. Many of the hazardous waste containers observed on-site were rusting or open and were therefore leaking."
Klondike reportedly also had opened, discarded concrete sacks piled on the site that the wind had scattered. Inspectors were led to believe the bags were occasionally burned on the site.
An above-ground heating oil tank on Klondike's property did not have secondary spill containment and the tank vent pipe was too short. In addition, it was not clear to inspectors whether a septic field had a leach permit from the state.
NPI IS SURPRISED
NPI representative Dane Crowley said this week he had not seen the report but couldn't imagine how NPI could have contaminated anything at the port.
"We haven't had any activity out there in about four years," he said. "It's pretty much just a chip pad out there right now."
Klondike Concrete CEO Steve Siegel said Thursday he didn't realize the site had been inspected and he doesn't know of any problems.
"We've had no citations, no warnings, no discussions about any issues out there," Siegel said. "I know we're not burning bags. If they were scattered, they've been cleaned up since."
Sullivan said the borough is filing a "Spill Notification" form with the state Department of Environmental Conservation and asking Travis/Peterson to create a corrective action plan for approval by that department. She said NPI and Klondike Concrete will be notified of the audit results and the correction plan.
"We're hoping the companies will work with us and we think they will," Sullivan said.
The Travis/Peterson report concludes by recommending steps NPI and Klondike should take and says that if they do not follow the recommendations, the borough could be found responsible and liable for remediation.
John Brown, with the state Division of Spill Prevention and Response, said oil and petroleum spills of up to seven gallons must be reported to the state within 30 days. Spills between seven and 55 gallons must be reported within 48 hours and larger spills than that reported immediately.
By K.T. McKEE
kmckee@adn.com