Port Bedeviled by Pollution Sins of the Past : Environment: Development is slowed as officials try to force payment from leaseholders who have fouled the site for decades.

Determined to boost its share of the booming Pacific Rim trade, the Port of Los Angeles is aggressively building for the future. In the process, it finds itself grappling with the pollution of the past.

Consider the harbor’s newest addition, a 100-acre shipping cargo facility nearing completion on Terminal Island.

The port allowed a former leaseholder, a scrap business, to leave the site before the full extent of pollution on the port-owned property was known. After testing turned up serious contamination, a county-supervised cleanup was performed. The port was left with the $12-million tab.

“We were left holding the bag,” said David McKenna, the port’s attorney. Now the port is in court trying to recover the money from the scrap business--National Metal and Steel Corp.--asserting that the company caused the pollution.

For decades, leaseholders ranging from oil terminal operators to shipbuilders have polluted acre upon acre of port-owned land. Increasingly, government regulators are requiring that such property be cleaned up before being put to other uses.

As a result, costly and time-consuming environmental work must come before port development projects these days. Faced with that--and seeking to avoid a repeat of the National Metal and Steel imbroglio--the port is pressing its leaseholders to clean up their act.

“We’ve been an industrial port since the turn of the century, so there’s bound to be contamination just about everywhere,” McKenna said. “In order to develop and go forward, we’re going to have to clean up these messes.”

Pollution sources in the port abound. Port leaseholders include terminals that handle crude oil, fuels, chemicals and more. There also are ship repair and boat building facilities, and a plant that grinds up huge quantities of discarded cars and other metal junk for export as scrap.

From an environmental standpoint, the worry is that pollutants produced by these and other sources seep into the harbor and contaminate marine life, including fish that use the protected water body as a nursery.

“Believe it or not, as heavily used as those waters are, they still have natural-resource value,” said Mark Gold, a biologist for Heal the Bay, a Santa Monica environmental group. “Pollutants getting into the sediment can impact those resources and lead to contaminated fish. And fish don’t stay in one place, so who knows where those pollutants end up?”

Last October, harbor commissioners voted to require leaseholders to measure their soil and ground-water pollution and begin taking steps to clean it up. They did so citing not only environmental concerns, but also threats to the port’s development plans.

“These sources of contamination now constrain future port development, both in terms of time and costs,” said the Harbor Commission resolution, approved unanimously.

In many cases, leaseholders are cooperating with environmental regulators and the port to tackle pollution. Two oil terminal operators are beginning to remove soil pollutants at their port facilities. Others are planning similar work.

Even when willingly addressed by leaseholders, ground contamination can still affect the timing of port development projects.

In San Pedro, the port’s plan to double the size of the Cabrillo Marina has hinged in part on a federally funded cleanup of a former military fuel pier. The cleanup is not expected to be completed until mid-1992 or early 1993.

The cleanup of a Chevron ship fuel facility will determine how soon the port can enlarge the entrance to its west basin. Intended to allow larger container ships to enter that part of the harbor, the project entails the partial removal of the Chevron site--work that cannot occur until the cleanup is complete.

A Chevron spokesman said the cleanup will take five years, but the port wants it done sooner. “All we’re arguing with them (about) now is how much time they need,” said Dwayne Lee, the port’s deputy executive director for development.

More troublesome for the port are leaseholders who are unable or unwilling to pay for environmental cleanup. As the landowner, the port can wind up paying the bill.

A 1990 bankruptcy agreement involving the former Todd Shipyard has left the port with the task of removing or neutralizing contaminants on the 100-acre San Pedro parcel.

The site is polluted with toxic heavy metals and is believed to be a source of polychlorinated biphenyls, or PCBs, embedded in nearby harbor sediments. Before a new tenant can set up shop on the land, the port must remove or neutralize the pollutants to the satisfaction of county and state regulators.

Donald Rice, the port’s director of environmental management, said it is too early to estimate the cost of a cleanup of the Todd site, but added that the price tag would exceed $1 million.

Unless it wins in court or settles, the port will also fail to recoup the $12 million it spent to remove and neutralize pollutants on the former National Metal and Steel site. The land, being developed as a cargo terminal by Yusen Terminals, a subsidiary of Nippon Yusen Kaisha of Japan, was polluted with heavy metals and PCBs--a suspected carcinogen.

Port officials said they were not aware of the extent of the pollution until excavations for the cargo project were under way. The cleanup lasted from August, 1989, to April, 1990.

“What you find when you dredge and put in piles is not necessarily detectable when you first go in,” said port spokeswoman Julia Nagano. “This is a problem facing ports around the world.”

National Metal and Steel contends that it was released from any obligations to the port in a 1986 legal settlement with harbor authorities that spelled out the terms of the scrap business’s departure.

The port disagrees, arguing that the settlement did not insulate the company from responsibility for subsequent cleanup work. McKenna, the port attorney, said he has been trying to reach a settlement with National Metal and Steel.

“We’re far apart in terms of what they’re willing to settle for and what we’re asking for,” McKenna said. “We’re progressing with the lawsuit, and we’re prepared to litigate.”

In the meantime, the port is trying to avoid a similar entanglement with a second scrap business on Terminal Island.

The business, Hugo Neu-Proler Co., shreds automobiles and other metal junk for export to foreign steel manufacturers. The 26-acre property is believed to be contaminated with a variety of pollutants, including heavy metals and PCBs, which have also been detected in nearby harbor sediment.

Correcting it could prove expensive. Earlier this year, 1.6 acres of the Hugo Neu-Proler site was transferred to the port’s control and cleaned up as part of the nearby Yusen container terminal project. The cost of the cleanup was $880,000, with the port picking up $290,000 and Hugo Neu-Proler paying the rest, port and company officials said.

Rice, the port’s environmental chief, said cleanup of the rest of the Hugo Neu-Proler site could cost $10 million. Industry sources said it is likely to be far more.

In lease renewal talks with Hugo Neu-Proler, the port has asked that the scrap business post a performance bond or other guarantee to ensure a cleanup, sources familiar with the discussions said.

The request did not sit well with Hugo Neu-Proler. Company officials said they will only pay part of the cleanup costs, asserting that much of the site’s pollution could be from previous leaseholders.

“It’s not a simple process to determine who are the responsible parties,” said Donald Bright, an environmental consultant for Hugo Neu-Proler. “Negotiations are continuing to find the most realistic way to remediate and properly share the costs.”

Port officials, faced with such problems, said they are determined to prevent similar situations. Among the rules imposed as a result of October’s Harbor Commission vote are requirements that leaseholders detect ongoing pollution and take steps to stop it.

Lee, the port’s deputy executive director, said: “The soundest policy is not to pollute to start with.”

Times staff writer Greg Krikorian contributed to this story.

Port Cleanup

A key challenge facing the Port of Los Angeles as it expands for the 21st Century is ensuring that harbor leaseholders clean up soil and ground water pollution. Here’s a look at some of the major cleanup projects. 1

Name: Chevron oil terminal (near berths 100-102)

Project Status: Cleanup under way

Pollutant: Petroleum hydrocarbons

2

Name: Former Todd shipyard (103-106)

Project Status: Cleanup planned

Pollutant: Heavy metals and possibly PCBs 3

Name: GATX oil terminal (118-119)

Project Status: Cleanup under way

Pollutant: Petroleum hydrocarbons

4

Name: GATX chemical terminal (70-72)

Project Status: Cleanup planned

Pollutant: Chemicals 5

Name: Former GATX chemical terminal (san pedro just northeast of 22nd and Miner intersection)

Project Status: Cleanup under way

Pollutant: Chemicals and solvents

6

Name: Hugo Neu-Proler scrap yard (210-211)

Project Status: Cleanup planned

Pollutant: Heavy metals, PCBs, petroleum hydrocarbons

7

Name: Mobil oil terminal (236-240)

Project Status: Cleanup planned

Pollutant: Petroleum hydrocarbons 8

Name: Shell oil terminal (Mormon Island, 168)

Project Status: Cleanup planned

Pollutant: Petroleum hydrocarbons

9

Name: GATX oil terminal Project Status: Cleanup planned

Pollutant: Petroleum hydrocarbons

10

Name: Ultramar oil terminal (Mormon Island, berth uncertain)

Project Status: Cleanup planned

Pollutant: Petroleum hydrocarbons

11

Name: Wickland oil terminal (Mormon Island, berth uncertain)

Project Status: Cleanup planned

Pollutant: Petroleum hydrocarbons 12

Name: Unocal oil terminal (150)

Project Status: Cleanup planned

Pollutant: Petroleum hydrocarbons

13

Name: Wilmington Liquid Bulk oil terminal and chemical storage (187-189)

Project Status: Marine oil terminal and chemical storage

Pollutant: Cleanup planned

Unknown????

14

Name: Former National Metal and Steel scrap yard (212 & 213)

Project Status: Cleanup completed

Pollutant: Heavy metals, PCBs

15

Name: Former military fuel wharf

Project Status: Cleanup planned

Pollutant: Petroleum hydrocarbons SOURCE: City of Los Angeles Harbor Department