U.S. to Reimburse Lockheed in Toxic Cleanup

The U.S. government agreed to reimburse Lockheed Martin more than $155 million for environmental cleanup costs stemming from decades of manufacturing at the firm’s Burbank defense facilities, according to documents filed in federal court Thursday.

Under the 29-page settlement agreement signed by U.S. District Court Judge Mariana R. Pfaelzer, the government will pay half of the $265 million that Lockheed Martin has paid since 1992 to clean up contaminated ground water and soil in Burbank.

For their part, federal officials also agreed to assume half of the estimated $110-million cost the Bethesda, Md., defense firm will incur over the next 20 years to clean water supplies under the city.

Lockheed first filed its claim to recover cleanup costs in 1997. The company alleged the federal government took control of the firm’s Burbank site--known as Air Force Plant 14--during World War II and owned and operated the facility until 1973.

The company also maintained in its suit that federal officials exercised daily control over operations at the site as Lockheed Martin employees worked on top-secret military projects, including the F-117 Stealth fighter.

“The bottom line is that we have funded all of the cleanup efforts at our Burbank facilities,” Lockheed Martin spokeswoman Gail Rymer said. “Now the government, which owned and sponsored a majority of the defense work there, is paying its fair share.”

A spokeswoman for the U.S. Department of Justice, one of the signatories to the agreement, said it was appropriate for the government to take responsibility for the costs associated with the cleanup.

“We think this is a fair settlement,” said Christine Romano, a spokeswoman for the Department of Justice. “It’s not unusual for the government to pay cleanup costs associated with its defense activities.”

Lockheed Corp., the forerunner of Lockheed Martin, was established in Burbank in 1928. It employed nearly 100,000 at its peak and churned out aircraft for World War II and the Cold War, including the P-38 fighter, U-2, SR-71 Blackbird spy planes and the F-117A Stealth fighter. It was the home of the legendary Skunk Works, which designed advanced military planes.

In 1980, cancer-causing compounds were found in the water and soil beneath the company’s industrial sites in Burbank. Eight years later, after extensive monitoring and testing, federal, state and local agencies determined the water was undrinkable and the soil toxic.

The defense contractor and other companies agreed in 1992 to pay $265 million to clean toxic compounds originally used as solvents such as perchloroethylene (PCE) and trichloroethylene (TCE).

Lockheed, in a settlement with federal and state authorities, admitted no wrongdoing but agreed to pay for operation of the plant. Later this year, Burbank will take over ownership and operation of the facility, with Lockheed, the other businesses and now the federal government continuing to pay cleanup costs.

Hundreds of residents blame Lockheed for alleged health problems and declining property values they attribute to the now-closed facility’s discharge of carcinogens and other hazardous substances into the ground, air and water.

In 1996, Lockheed reached a confidential $60-million out-of-court agreement with more than 1,300 current or former city residents.

Another 3,000 civil lawsuits have been filed in state court by individual residents who allege they were sickened by chemicals used at the plant.

Alan Sigel, one of the attorneys representing plaintiffs who have sued Lockheed, said Lockheed shared far more than 50% of the responsibility for the contamination and illnesses resulting from defense activities.

“I’m pleased Lockheed’s struggle with the government has concluded, but the battle is far from over,” Sigel said.

In the late 1980s, Lockheed began closing its Burbank facility and moved manufacturing to Palmdale and Marietta, Ga. The company merged with Martin Marietta Corp. in 1995 to become Lockheed Martin.