Disneyland, world-famous for its sparkling-clean park, agreed Friday to pay the largest toxic waste fine ever assessed by the U.S. Environmental Protection Agency for hiring a company that illegally disposed of its hazardous materials for two years.
The $550,000 fine settles a complaint filed by the EPA under which the Walt Disney Co. was charged with 38 violations of federal toxic waste laws during 1988 and 1989.
EPA officials said Disneyland hired a company that illegally hauled 14,000 gallons of paint thinner, cleaning solvents such as acetone and other toxic materials to two disposal sites, in Wyoming and Utah.
Thirteen separate shipments were trucked to a Wyoming oil-disposal plant and one to a Utah plant--neither of which have the authority to handle the types of waste sent by Disneyland, according to the EPA.
Disney officials acknowledged the illegal disposal and said they are extremely embarrassed by it. They said they did not know that their contractor, Ken's Oil Co. Inc. of Garden Grove, was handling the waste improperly until they were notified by the EPA last year.
"We were guilty of naivete to an amazing degree," said Kym Murphy, corporate vice president of environmental policy for the Disney Co., based in Burbank.
"We had a good working relationship with the contractor, and we thought it was all being done with the appropriate procedures and permits."
Federal law, however, says a company that produces the waste is the party responsible for ensuring it is handled safely from creation to disposal.
"We take these violations very seriously," said David Janik, an enforcement attorney in the EPA's Denver office who handled the case.
"These facilities need to follow strict procedures and safeguards, or we can't ensure that the materials aren't going on the ground or someplace else unsafe."
The $550,000 fine is the largest in the nation paid by a company for improper disposal of toxic waste since the EPA began enforcing the federal laws 14 years ago, Janik said.
A larger fine, $2 million, was paid a few years ago by Chemical Waste Management for violations at its toxic waste landfill in Kettleman City, near Fresno. But that was a disposal facility, not a company that generates waste, and the penalty was assessed through the U.S. attorney's office, not the EPA, officials said.
The EPA originally sought $950,000 in the Disneyland complaint, based on $25,000 per violation. The settlement took several months of negotiations.
Murphy said that even for a company as large as Disney, the fine is "very substantial."
"Being a first offender, we could have been treated a little more cordially," he said. "I thought we should be given probation, not a fine."
He said he believes that the EPA is using Disneyland to set a tough and visible example for other companies.
"It certainly will get industry's attention," Murphy said. "They picked a company that really showcases their seriousness. When the general public hears this, they think 'My gosh, Disneyland, how could Disneyland even have hazardous waste?' "
Hundreds of thousands of U.S. companies generate hazardous waste, with more than 5,000 of them in Orange County alone.
EPA officials said they are not picking on Disneyland. The size of the fine is appropriate for the large number of shipments that went to the plants illegally, Janik said.
Four other Southern California companies and the city of Fontana, which all used the same two plants, are being fined $75,000 to $150,000 apiece. The fines are smaller because fewer shipments were involved, Janik said.
EPA inspectors discovered the violations while checking the Wyoming plant's records, he said. EPA officials are trying to track down what happened to the paints and solvents at the plants, which are in La Barge, Wyo., and near Salt Lake City. The plants have EPA permits to recycle or burn only oil, not other wastes.
"We still don't know what happened to the waste, or whether there was harm to the environment or public health," Janik said. "If it was burned, there could have been improper emissions."
Janik said the EPA has filed a complaint seeking to shut down the plants, both owned by a company called Mountaineer Refining.
On Thursday, Disney filed suit in Orange County Superior Court against its contractor, Ken's Oil Co. Inc. Ken's officials were unavailable for comment Friday.
Ken's had been a Disney contractor for eight years, until its dismissal last year after the EPA told Disney of the violations, Murphy said.
EPA officials said that Disney was cooperative in the investigation and that they have no evidence indicating that company officials knew of the violations. But they said Disneyland officials signed the federally required forms that show where the shipments are going.
"They should have checked into this facility," Janik said.
As part of the settlement, Disneyland is conducting an environmental audit at the park and beginning an employee training program.
The penalty is especially ironic because Disneyland, which celebrated its 35th birthday Tuesday, takes great pride in its cleanliness. Its streets are steam-cleaned daily, and its attractions are repainted almost continually.
But many of the same products that keep the park so clean--solvents, paints and varnishes--are toxic materials that must be disposed of only at special hazardous-waste sites. The theme park uses about 20,000 gallons of paint per year.
"It's an extremely difficult lesson for us to learn this way," Murphy said. "The amount of waste was small, and it certainly wasn't malicious."