Paper Mill Fights EPA Controls : Jobs vs. Pollution: 2 States Clash Over River Cleanup

There was a time when the 75-mile-long Pigeon River was an ideal spot for catching trout, taking a swim, drawing drinking water and performing church baptisms.

Rising in the majestic Great Smoky Mountains of western North Carolina, the stream flowed crisp and clean over a pebbly bed in a northwesterly direction until it joined the French Broad River near Knoxville in eastern Tennessee.

But all that was before the Champion paper company built a pulp mill in the early 1900s in the North Carolina community of Canton, about 20 miles downstream from the Pigeon’s headwaters.

Now, as a result of eight decades of pollution, beyond Canton the once-pristine river has become a fetid sewer that Tennesseans say looks like Coca-Cola, smells like rotten eggs and is laced with potent carcinogenic dioxins.

Tennesseans have been trying for decades to get Champion to clean up its operations, claiming that the mill--now a major producer of paper for juice and milk cartons and for envelopes--is responsible for the pollution and a hazard to their health and economic well-being.

In Hartford, a river hamlet of about 780 residents five miles west of the North Carolina border, townspeople blame the poisons in the stream for a rash of cancer deaths in recent decades.

“We’ve had 167 deaths from cancer in the past 20 to 30 years,” said Mary Woody, postmaster of the town that local residents have grimly dubbed “Widowville.”

Added 81-year-old Margaret Jenkins: “My husband died from cancer on his 71st birthday in 1977, and I can look out my kitchen window and see half a dozen other homes where there’s been cancer deaths. There’s been so many died with it, it’s a tragedy.”

In Newport, a town of 7,580 residents about 15 miles farther downstream, environmental activists say fish taken from the river show high levels of dioxin, often have missing eyes and fins and are covered with unsightly sores. The town long ago stopped using the Pigeon for its municipal water.

Four years ago, prodded by Tennessee, the U.S. Environmental Protection Agency stepped into the dispute and attempted to impose more stringent waste-water discharge requirements on the Champion plant.

But the agency’s action set off a classic jobs vs. environment controversy that has since turned into a diminutive War Between the States.

Champion, whose Canton mill is the largest single employer in hard-pressed western North Carolina, contends that the only way it can meet the EPA’s proposed standards is to reduce its operations and cut its nearly 2,000-person work force in half.

To North Carolinians, that spells economic disaster. Champion pumps almost $210 million into the regional economy, including more than $96 million in employee wages and benefits. About $600,000 of Canton’s $3.75-million annual operating budget comes from Champion’s city taxes.

“This town would be dead without Champion,” said Roy Lee McCord, 53, of Canton.

Governors Clash

In the dispute, the governors of Tennessee and North Carolina have traded harsh words, North Carolina legislators have attempted to ban the sale of Tennessee sippin’ whiskey within their state’s borders and environmental activists have become the objects of death threats.

In addition, more than 175,000 letters have been sent to the EPA’s regional office in Atlanta from partisans on both sides of the issue.

The battle has been fought in federal courts and has even raged in the halls of Congress.

“In all my experience, there’s never been an issue quite like this,” said Fritz Wagener, regional EPA water quality standards coordinator.

The feud erupted in May, 1985. North Carolina had routinely approved the renewal of Champion’s waste-water discharge permit. But after complaints by environmental activists and state officials in Tennessee, the EPA vetoed the permit--the first time in its history that the agency had ever overridden a state’s authority to issue such permits.

Champion filed a federal lawsuit challenging the EPA veto. In December, 1986, U.S. District Judge David Sentelle in Asheville, N.C., upheld the agency and, in the spring of the following year, the EPA wrote a draft permit that Champion said would have forced the mill out of business.

The EPA proposal called for the water at the end of the mill’s discharge pipes to contain no more than 50 color units instead of the 85 color units the state of North Carolina had allowed.

The difference in color between water with 50 color units and water with 85 color units, EPA officials say, is like the difference in color between ginger ale and tea.

Hearings on the EPA’s proposed guidelines were set for May but were later postponed to January, 1988.

Protest Movement

Meanwhile, a protest movement against the EPA and Tennessee was formed in Canton, which has a population of 4,700. Blue-and-white signs saying “We Support Champion” blossomed throughout the town in shop windows, neighborhood lawns and school buildings.

“The way that draft permit was written . . . we’d have had to turn the lights out and walk away,” Oliver Blackwell, a Champion vice president and manager of the Canton operation, said in a recent interview.

Dissenting voices were stifled. Rebecca Allen, a former Canton elementary school teacher, says that she was given her first unfavorable evaluation in her then 17 years of teaching and was transferred to a less challenging assignment after she attempted to have her fifth- and sixth-graders study both sides of the issue.

Posters Torn Down

In one clash with school administrators, she recalled, six small posters that she had put up in her classroom along with newspaper clippings of the story were torn down by the school district superintendent. The posters, which Allen had made by hand, bore such slogans as: “Don’t Muddy the Waters With Emotion” and “Don’t Cloud the Issue.”

“He took them down right in front of me and the kids,” she said. “I was afraid those kids were going to think that’s how it is--when you stand up for something you believe, somebody’s going to come and get you.”

She resigned from the Canton school system in 1988 and now is an eighth-grade teacher in Andrews, a North Carolina town about 70 miles southwest of Canton.

In the face of such controversy, the EPA consulted with environmental officials from both North Carolina and Tennessee and drew up a new draft permit that called for a standard of 85 color units in the river at the border between the two states.

Canoe Trip

After public hearings on the new proposal, North Carolina officials gave their approval, but Tennessee Gov. Ned McWherter gave it a thumbs down. McWherter’s rejection, which he announced on Christmas Eve, came after he made a canoe trip down the Pigeon, from above the Canton mill, where he found a “Class A trout stream,” to downstream, where the pollution is thickest.

“They’re not doing us right,” he said, referring to North Carolina.

North Carolina Gov. James G. Martin was livid. “North Carolina is being injured by an irrational attitude by the Tennessee government,” he said, adding: “We don’t like it.”

Tensions grew; neighborly feelings evaporated. North Carolinians stopped shopping in Tennessee and Tennesseans stopped shopping in North Carolina.

Ronnie Sprinkle, owner of a downtown Canton dry cleaning shop, says he stopped using the two Tennesseans who were among his business supply vendors. “Anybody who has a governor that acts the way theirs does doesn’t deserve my money,” he said.

Two North Carolina state senators proposed prohibiting Jack Daniels whiskey from crossing the border into their state. In response, Sam Venable, a Knoxville News-Sentinel columnist, said that such a ban would be fine with him and urged his fellow Tennesseans to join him in drinking North Carolina’s share.

Dick Mullinix, a retired engineer and president of the North Carolina-based Pigeon River Action Group, which was formed in 1983 to protect the river, says that he was forced to leave his home in Waynesville, near Canton, after a rash of threatening phone calls. He took refuge for the rest of the winter at his vacation retreat in Florida.

He says that one anonymous caller told his wife: “You know that husband of yours who loves the Pigeon River. You’re gonna find him floating down that river face down one of these days.”

Once again, the EPA decided to redraft Champion’s permit. Among other things, this latest version calls for a standard of 50 color units in the Pigeon by the time the river reaches Tennessee, and for the first time calls for dioxin testing.

Hearings Set

Public hearings on the proposal have been scheduled for August in Knoxville and Asheville. Meanwhile, Champion continues to operate under the permit that it has held from the state since 1985.

Champion officials say they can live with the proposed requirements, although it will require a cutback in production and the layoff of about 1,000 workers--about 50% of the work force. It also will require expenditures of about $175 million in new anti-pollution equipment.

But few residents in Canton and the surrounding area of North Carolina are pleased at the prospect of so many permanent layoffs.

Some merchants are already feeling the pinch as Champion workers and others who make their livelihood from the firm--such as loggers and truckers--hold back on purchasing big-ticket items.

“Our sales are off about 30% and have been for about seven months,” said Hugh Yarborough, general manager of a Canton car dealership.

At Canton’s municipal building, City Manager Bill Stamey says that local and county officials are working on a plan to recruit a manufacturing concern that would absorb any workers Champion lays off.

He says the mood in Canton is one of anxiety and despair over the future.

“People with young children are saying: ‘How am I going to educate my kids.’ It’s very traumatic,” he said. “I’ve never known a federal agency that’s done more to heap misery on people than EPA.”

Across the border in Tennessee, residents are sympathetic with Canton’s plight but say that Tennesseans have long suffered while Champion and North Carolinians prospered.

Charles Moore, chief administrative officer of Cocke County, through which the Pigeon flows in Tennessee, says a study done by Walters State College shows Cocke County is losing between $7 million and $10 million a year in tourism revenues alone because of the river pollution.

How soon the issue is resolved remains to be seen. Environmental groups in Tennessee say that, at the August public hearings, they intend to challenge several important provisions in the latest proposed permit--including one that would give Champion the authority to perform the required dioxin testing.

“That’s like putting the fox in charge of the chicken coop,” said Fran Ketterman of Newport, secretary of the Tennessee-based Dead Pigeon River Council.

Both sides in the dispute would like a speedy resolution. North Carolinians say too much damage already has been done in the protracted arguments.

For different reasons, Tennesseans agree. “I would like to see that river clean just once before I join my husband,” said widowed Margaret Jenkins, who was born in the same year that Champion built the mill.