Accused of polluting, this major employer in Columbus area is forced to close factory
A major employer in the Columbus area, accused of polluting the environment and damaging property, must shut its factory by the end of next week because the federal government refused to again extend the deadline to install emissions-reducing equipment.
The closure of Continental Carbon’s plant in Phenix City will mean the loss of approximately 120 full-time positions and roughly another 20 contractors, although only about 30 workers currently are employed at the factory, Dennis Hetu, president of the Houston-based company told the Ledger-Enquirer.
Continental Carbon manufactures carbon black. The main uses of carbon black are as a reinforcing agent in rubber compounds, mostly in tires, and as a black pigment in printing inks, surface coatings, paper and plastics.
In a Dec. 8 letter to Greg Johnstone, manager of Continental Carbon’s Phenix City facility, Alabama Department of Environmental Management air division chief Ronald Gore ordered the company to cease the plant’s operation on or before Dec. 31 because “it had not begun to install the required control systems and would not do so by the deadline.”
Gore told the Ledger-Enquirer that Continental Carbon hasn’t complied with the 2015 consent decree, which settled allegations from ADEM, the U.S. Environmental Protection Agency and the U.S. Department of Justice that the company has violated the Clean Air Act by failing to reduce emissions of sulfur dioxide, nitrogen oxide and particulate matter. When people inhale those emissions, the pollutants can lodge deep in the lungs and cause a variety of health problems and even premature death, according to the EPA.
In 2017, the federal and state governments agreed to extend Continental Carbon’s deadline to complete the pollution control upgrades at the Phenix City plant from 2020 to Dec. 31, 2022.
The EPA estimated in 2015 it would cost Continental Carbon $98 million to comply with the consent decree at its three plants. Since then, the company has invested more than $300 million in new pollution control equipment at its Oklahoma and Texas plants and planned to invest more than $100 million at its Phenix City plant, Johnstone told the L-E in August.
With a profit margin of 3%, spending that amount would put Continental Carbon in “an uncompetitive position” because it would add 3-6 cents per pound of carbon black in operating costs, Hetu said in September, “in a market where a fraction of a penny makes or breaks a sale.”
Continental Carbon was prepared to immediately spend $50 million for new pollution control equipment and engineering of the installation if its request for another deadline extension was granted, Hetu said then.
The regulators didn’t buy that argument.
“The bottom line is, the five- or six-year free period was for the installation of control equipment, not just to run free and abandon the plant afterward,” Gore said. “… Therefore, they don’t have authority to operate after the first of the year, and that’s what my letter was intended to tell them.”
No significant improvement
Since the EPA started investigating Continental Carbon 15 years ago, ADEM hasn’t seen significant reduction in the Phenix City plant’s emissions, Gore said.
“If they’re operating today, they are violating ADEM’s and the federal EPA’s air pollution (regulations),” he said. “That was true in the opinion of the two agencies since more than 10 years ago.”
Gore noted the largest amount of emissions from the plant isn’t soot but sulfur dioxide, which is invisible.
“It causes all kind of atmospheric problems,” he said. “When that goes away in a week or two, pollutant levels in the area will go way down.”
Legal background
For 53 years, Continental Carbon has operated a plant in Phenix City, at 1500 State Docks Road, along the west bank of the Chattahoochee River and across the state line from Columbus.
In August 2001, a class action lawsuit on behalf of now-closed Action Marine owner John Tharpe and others in the Columbus area was filed against Continental Carbon, seeking compensation to their properties from what federal environmental investigators concluded was soot emitted from the Continental Carbon plant across the Chattahoochee River in Phenix City. The city of Columbus and South Columbus Concerned Citizens president Owen Ditchfield joined the lawsuit.
In 2004, the city of Columbus, Tharpe and Ditchfield won a combined total of more than $20.7 million in their lawsuit. The city was awarded $570,000 in compensation. Tharpe received a $100,000 personal award and $1.2 million for his boat dealership. Ditchfield was awarded $45,000 plus interest.
Continental Carbon also had to pay $17.5 million in punitive damages, of which $3.4 million went to the city of Columbus. After $1.3 million in attorney fees, how the rest of the money was split between Tharpe and Ditchfield remains private.
Continental Carbon’s response
Hetu said Continental Carbon’s four competitors in North America received an extension of their December 2022 deadline after claiming what’s called “force majeure,” which are circumstances beyond one’s control. Hetu said no federal officials have explained why Continental Carbon wasn’t granted the same reprieve.
“I think they looked for an opportunity to say, ‘We won. We took out a carbon black manufacturer,’ and it was us,” Hetu said. “… We weren’t asking to be absolved; we were just asking for more time.”
The L-E didn’t reach any federal officials for comment in this story before publication.
Hetu contends Chinese and Russian companies will fill the void in the carbon black market left by shutting the Phenix City plant.
“Those two countries are going to produce carbon black in a non-environmentally-sound facility,” he said, “and they’re going to ship that material to the U.S.”
Continental Carbon employees who finish the year at the Phenix City factory will receive a severance package between two weeks and one month of their salary, depending on their job level, Hetu said. All of them were offered jobs at the company’s two other plants, where approximately 300 are employed, and “five or six” of the remaining 30 in Phenix City accepted the offer, he said. The others found jobs elsewhere or will retire, he said.
Hetu estimated about a dozen employees will continue to work at the Phenix City facility during the next six months to perform shutdown tasks.
As for what will happen to the 60-acre property and the plant’s five buildings, which cover about half the land, Hetu said he already has received some offers, “but nothing real significant.”
Community reaction
When the Phenix City plant was operating at full force before the COVID pandemic, the wages and benefits totaled approximately $6.5 million, Johnstone previously said. Continental Carbon annually spends more than $4 million with local businesses for services such as transportation, maintenance, equipment and supplies, plus taxes exceeding $550,000 per year, he said.
Phenix City Mayor Eddie Lowe, who had written an undated letter addressed “To Whom It May Concern” in support of Continental Carbon’s request for a deadline extension, declined to answer the L-E’s question about the closure. He referred the L-E to Phenix City economic development manager Shaun Culligan.
Culligan wouldn’t share his opinion about the federal government’s decision, but he said in an email, “Our responsibility is to prepare for all outcomes and aid the company and its employees in the event of a substantial transition. We are prepared to do just that.”
Asked what his department will do to help laid-off employees, generate replacement jobs and find another use for the plant and property, Culligan said they have made Continental Carbon aware of the state’s federally funded Rapid Response Unit within the Workforce Innovation and Opportunity Act, which provides services such as assistance with filing unemployment insurance claims, career information, re-employment workshops and training programs.
“We are constantly working to help create more jobs within our community,” he said. “Those efforts will not slow down.”
When the plant and property become available, Culligan said, “we will work with Continental Carbon and their team to market the space.”
In addition to the federal class-action lawsuit, 142 more local property owners sued Continental Carbon in 2004 in Russell County Circuit Court. They claimed years of carbon black emissions from the company’s Phenix City plant damaged their homes, boats and cars, reduced property values and threatened their health. They eventually received undisclosed settlements.
Oakland Park resident John Marvets was among them. So when the L-E told him that Continental Carbon has been ordered to close, he said, “I hate it for the employees, but I’m glad for the neighborhood. If they did what they were supposed to do, I had no problem at all. Business is tough, I get that, but it’s been seven years or longer. I mean, come on. They should have complied with the court order.”
Ken Henson, a local lawyer who moved downtown from north Columbus five years ago, is another resident who alleges soot from the Continental Carbon plant blackens his property.
Reacting to the factory’s ordered closure, Henson told the L-E, “It’s long overdue. They’ve been playing everybody for over 20 years.”
During its Oct. 25 meeting, the Columbus Council unanimously approved a resolution opposing Continental Carbon’s request for a deadline extension. Now that the company has been ordered to shut the plant, Columbus Mayor Skip Henderson told the L-E he supports the decision.
“I hate to see jobs leave,” Henderson said. “A lot of those jobs are filled by people in Columbus. But you’ve got to do more than just provide jobs. You’ve got to take responsibility for the impact of your organization on the community. They had multiple opportunities to try to make changes that would have put them in compliance with the EPA. But they just elected not to do it. So, based on what they failed to do, I think the EPA made the absolute right decision, and it was the appropriate ending to this challenging time.”
The Chattahoochee Riverkeeper, a nonprofit environmental advocacy organization dedicated to protecting and restoring the Chattahoochee River Basin, filed a complaint to the EPA against Continental Carbon in May, alleging the Phenix City plant is failing to comply with ADEM’s industrial stormwater general permit.
That’s why Chattahoochee Riverkeeper executive director Juliet Cohen supports the order for the plant to close.
“Continental Carbon was put on notice more than a decade ago that its operations were polluting our environment and harming public health,” Cohen told the L-E in an email. “We are reassured that ADEM is standing behind its orders and prioritizing a safe and healthful environment for the communities along the river.”
The L-E didn’t reach Greater Columbus Chamber of Commerce president and CEO Jerald Mitchell for comment in this story before publication.
This story was originally published December 22, 2022 at 12:34 PM.
