Political Maneuvering Clouds State Water Safety Regulation : Legislation: A 1989 law includes a seemingly toothless rule on the pesticide DBCP. But special interests--both environmental and business--have stirred the issue to a boil.

As state laws go, Health and Safety Code Section 4018 looks about as wimpy as they come.

A part of California’s clean drinking water act, Section 4018 became law in 1989, then slipped the minds of almost everyone except a few scientists deep in the state Department of Health Services. The section tells these scientists to analyze health risks of contaminants in drinking water, but gives them no deadline.

Six years later, the scientists are still analyzing. Even when they’re done, local water agencies around the state won’t actually be required to remove all traces of contaminants. Section 4018 merely directs that they monitor pollutants, make efforts to clean up the water and, if they can’t, issue reports explaining why.

But though it all seems fairly weak, players such as Occidental Petroleum, Dow Chemical and Shell Oil pushed hard in the final weeks of the legislative session that just ended to win passage of a bill to repeal Section 4018. They intend to succeed when lawmakers return in January.

Spokesmen for the firms say they are backing the legislation by state Sen. Charles Calderon (D-Whittier) because their firms are large water users, and Section 4018 could, over time, force water rates to spiral upward.

But as Calderon’s bill sped along for a time at the end of the legislative session, environmental groups embraced this arcane section as one vital to water quality. Insisting that corporate interest in the bill goes beyond fears of water rate increases, the section’s newfound defenders believe that at least some support for Calderon’s bill is tied to one of about 80 pollutants covered by the code: a banned pesticide called DBCP.

The fight over this seemingly minor statute is part of a larger change in Sacramento. With the Legislature increasingly conservative, more lawmakers are convinced that the costs of environmental safeguards outweigh their benefits, and are working to roll back laws that gave California some of the nation’s toughest protections for land, water and air.

Calderon’s bill (SB 1307) is a prime example of how special interest legislation is packaged and marketed. The veteran Democrat plans to push it again in January, and blames the delay on unfair charges by other special interests--environmentalists and trial lawyers who, he says, hope to use the section to bring more lawsuits.

“Even if these public health goals are met,” he said, “opponents of the bill have not produced one scientist who can say there will be a gain to public health. It’s like saying, ‘Everyone should drive a Mercedes instead of a Volkswagen because a Mercedes costs more.’ ”

Aided by an aggressive public relations campaign, Calderon’s bill has won many backers among local water officials and some health experts who say Section 4018 will provide little if any health benefit.

But while Calderon calls his bill a simple attempt to erase an unneeded law and protect consumers from huge water rate increases, Assemblyman Byron Sher (D-Palo Alto) calls it a “shabby . . . power play by special interests.”

Sher is the Assembly Natural Resources Committee chairman and author of the 1989 bill that created the section. He calls it a modest statute designed primarily to give the public information about contaminants in its drinking water supply.

If Calderon’s bill succeeds, Sher warns, “the people who put these toxic chemicals in the drinking water won’t have that [information] in the public domain, the users won’t know about it and that will decrease pressure on them to clean up their messes.”

To understand the relationship between drinking water laws, lawsuits, DBCP and possible corporate motives to abolish Section 4018, a little context is necessary:

* California banned DBCP, short for dibromochloropropane, in 1979 after scientists detected it in Central Valley ground water and concluded that in large enough doses the pesticide causes testicular atrophy and cancer.

In decades past, Shell, Dow and Occidental made or formulated the once widely used soil fumigant. Today, the companies are fending off lawsuits by Central Valley cities that draw their water from underground aquifers contaminated or threatened by DBCP.

The litigation already has cost the firms more than $21 million, and that is from just one suit brought by the city of Fresno and settled in June. At least five other cities, from Modesto to Dinuba, are pressing their own DBCP suits.

* With or without Section 4018, California water law goes beyond federal standards. The Legislature in 1976 approved a state clean water act, which required that the California Department of Health Services set standards called maximum contaminant levels for drinking water pollutants. The levels are based on health factors, plus the cost of cleaning up the toxins.

Since then, the health department has adopted levels for 18 chemicals that are more stringent than federal standards. For DBCP, the state level is 0.2 parts per billion.

The settlement in Fresno’s lawsuit requires that the companies pay to keep the DBCP levels in drinking water within the maximum contaminant level for the next 40 years.

* In 1989, Sher pushed through legislation to rewrite the drinking water act, adding Section 4018 and a few companion sections. It did not come without a battle. Sher even threatened to hold up part of the state health department budget to get it through the Legislature.

Section 4018 and its companions require that state toxicologists set new numbers, called recommended public health goals. The goals must be set purely on a health basis, without regard to the cost of cleanup. Local water agencies must try to meet the goals. But if they find technology does not exist or is too costly for them to meet the goals, they may file reports saying as much.

Stringent Contaminant Levels

A year ago, in an event that even Sher missed, the health department published recommended public health goals for 25 drinking water contaminants, including DBCP. The new number for DBCP was lowered to 2 parts per trillion, 100 times more stringent than the maximum contaminant level.

One man who noticed the listings in an obscure state register was Frederick Pownall. His reaction? “Oh, my God.”

Pownall lobbies for Occidental in Sacramento, and is a partner in the law firm Landels, Ripley & Diamond. The San Francisco office of Landels, Ripley & Diamond defended Occidental in the DBCP suit. Pownall says, however, the litigation is not Occidental’s motivation for pushing the bill.

“The primary motivation,” he said, “is potential huge rate increases for drinking water users. . . . The fact is that while that litigation was concerned with DBCP, the recommended public health goals are concerned with some 80 [contaminants]. It is the sum and substance of the numerous chemicals that are going to cause the great expense [to large water users].”

Officials at Dow and Shell made similar statements, saying their support for Calderon’s bill has nothing to do with the DBCP litigation.

As it turned out, the health department listing had problems. For one, DBCP cannot be measured at such minute levels, said Harvey Collins, head of the unit that produced the list.

A second problem involves the strange workings of state bureaucracy. For complicated reasons, state attorneys concluded that the California Environmental Protection Agency, not the health department, is the agency that should have issued the recommendations. As a result, the recommendations were withdrawn. Of course, Cal-EPA could reach a similar conclusion. The same scientists who did the health agency analysis are redoing the Cal-EPA analysis.

Seeing that possibility, Pownall met with lobbyists for the state Chamber of Commerce and water utilities at the start of the year to develop a strategy.

As a first step, they formed the Alliance for Responsible Water Policy. Then, the alliance hired a firm to develop a cost estimate for meeting the recommended public health goals. Shell was one of those who helped pay for the cost estimate.

The report, dated in July, analyzed the cost of meeting the health department’s retracted goals for four contaminants: arsenic, industrial solvents TCE and PCE, and DBCP.

The document, now trumpeted by supporters of Calderon’s bill, found that the cost of lowering the levels of the four chemicals to the recommended goals would be as much as $5.61 billion, even though, according to Sher’s reading of the law he wrote, the code does not require that the goals ever be met. In addition, a Senate analysis disputed the cost estimate, saying it was exaggerated by a factor of six to 30.

Meanwhile, in May, lawyers for Fresno, Occidental, Shell and Dow interrupted their trial and settled the Fresno case. The firms agreed to pay to maintain monitoring and filtration systems at Fresno’s wells to keep DBCP within the maximum contaminant level for the next 40 years. The total cost could reach $80 million.

But the settlement also includes a provision dealing with recommended public health goals. Fresno reserves the right to litigate more if the recommended public health goal for DBCP becomes more stringent.

Duane C. Miller, a Sacramento trial attorney, represented Fresno in the DBCP case. If the goals were set at 2 parts per trillion, he said, “for the city of Fresno alone, you’re looking at $100 million, and it could double.”

In Sacramento, Pownall spoke to Calderon about carrying a bill. Calderon, unlike many Democrats, has little use for environmentalists.

“Environmentalist groups are suffering a loss of membership,” Calderon said. “This is an issue they want to use to bolster their revenue and get back on the national agenda. . . . They’re going down and they’re pulling the Democratic Party down with them.”

Public Relations Campaign

As lobbyists worked inside the Capitol, the influential public relations firm Burson-Marsteller mounted a campaign on the outside. Burson-Marsteller spinmeisters were not, however, the public spokesmen for Calderon’s bill.

That job fell primarily to John Gaston, an engineer for a private firm who is active in water associations. A former director of the state drinking water safety program, Gaston was in charge of the state’s water safety program when DBCP first showed up in underground water in the 1970s. Earlier this year, Gaston was Fresno’s expert witness on DBCP in the city’s suit.

Now, Gaston is volunteering his time to work for Calderon’s bill. He recalled that when he came aboard, a lobbyist for one of the firms in the DBCP litigation quipped: “ ‘It only seems fair that you work for free because you screwed us out of $80 million.’ ”

One of Gaston’s main jobs has been to organize support from water agencies, including the one run by the city of Fresno. In interviews, Fresno officials said that while the city may be giving up future litigation rights over DBCP if Calderon’s bill passes, all ratepayers would have to pay far more to reduce naturally occurring carcinogens such as arsenic if the public health goals are ever enforced.

Collins, head of the state water safety program, also has been helpful to Calderon’s bill. He calls the requirements of Section 4018 extravagant and says they will provide no benefits to health, and wrote a letter saying as much. The Alliance for Responsible Water Policy has distributed the letter widely.

As for the since-retracted DBCP goal of 2 parts per trillion that his agency proposed last year, Collins said, “It would make no sense to set an enforceable standard at that level because you can’t even measure it.”

In the final days of the session, Calderon seemed to have everything lined up: Local water officials had sent stacks of endorsement letters, a report documented huge costs associated with Section 4018 and top health officials derided it.

Then, Sher and his allies began their campaign to derail it.

They were unaware of the Fresno lawsuit. But convinced that business “polluters” were behind the bill, Mary Raftery of the California Public Interest Research Group spent hours reading through public lobbyist reports, finding that several corporations paid lobbyists to support the bill.

To spread that message, Sher, Raftery and other environmentalists held a press conference with two weeks left in the legislative session. One called it the worst environmental bill of the session. Another warned of the dangers of a potential cancer epidemic.

But the Assembly, with Democratic votes, approved the bill and it moved to the Senate for final action in the last week of the session. Gov. Pete Wilson was prepared to sign it.

By accident, one of Sher’s aides heard about the Central Valley DBCP lawsuits and attorney Miller’s role. He called Miller. The lawyer hadn’t heard of Calderon’s bill, but immediately saw a connection to the litigation.

“What they’re doing on the legislative front is to forestall more litigation,” Miller said. “It’s an attempt by some manufacturers of pesticides to absolve themselves of liability.”

The lawyer provided a copy of the Fresno suit and settlement documents to Raftery, who called them a “smoking gun.” She distributed them in the Capitol and tried to get lobbyists for the influential trial attorneys to join the fight.

With three days left in the session, opposition was building. Environmentalists mobilized their troops to call the offices of swing lawmakers, and a trial lawyer lobbyist had started asking questions. Calderon opted to delay a final hearing until January. While trial lawyers never took a stand on the bill, Calderon places some blame for the delay on them.

“I guess they see a niche here,” said Calderon, himself a lawyer. “Their only motivation is it could be . . . another cottage industry.”

The bill is in limbo for now, but the campaign continues. Burson-Marsteller issued a press release a few days ago. Quoting Gaston, the release warned that unless the bill is approved, “businesses and residents will soon be hit by the largest single increase in their water bills in California’s history.”