10/26/2001

Monaco, neighbors settle feud over fumes

Lawsuit: The RV maker agrees to install burners to incinerate the toxic chemical fumes.

By JOE HARWOOD and CHRISTIAN WIHTOL
The Register-Guard

The Register-Guard

COBURG - Monaco Coach Corp. will be giving its Coburg neighbors a breath of fresh air within the next four months.

To settle a $33 million lawsuit that 25 neighbors filed against the company earlier this year, Monaco has agreed to install costly burners to incinerate smelly toxic chemical fumes from its RV paint-spray booths.

The settlement was mediated by U.S. District Judge Ann Aiken of Eugene. Only limited details of the deal are being released. For example,Monaco is apparently making a cash payment as part of the settlement, but the amount was not disclosed.

Under the agreement, Monaco will install the incinerators by Feb. 28, said David Paul, the Portland attorney who sued the company on behalf of the neighbors. He said Aiken will administer the settlement and could be called upon if compliance issues crop up.

The equipment will eliminate virtually all toxic fumes being emitted from the booths, said Tom Wood, a Portland attorney who represented Monaco.

Paul said the incinerators will burn up approximately 95 percent of the toxic emissions.

"I would like to see 100 percent of the emissions controlled by the incinerators," he said. "But we're going to get a good program in place that should get rid of the spikes, the highest periodic emissions."

Residents of the subdivision south of Monaco's paint-spray building started complaining of metallic-tasting fumes wafting through the neighborhood in the late summer of 1999, shortly after the RV maker completed an expansion and started operating the new paint facility. The neighbors said the fumes irritated their eyes, nose and throat, forcing them indoors.

Neighbors on Thursday expressed relief at the settlement and the prospect of clean air in their back yards.

"It's like a great weight has been lifted by being able to know your kids aren't going to be outside playing in polluted air," said Brian Pech, who lives in the subdivision.

Monaco's emissions include traces of toluene, xylenes, ethyl benzene and other federally classified hazardous chemicals. While neighbors said they fear the ill effects of these compounds, the lawsuit they filed alleged only that the odors were a nuisance and a trespass.

Pech said the residents next to the plant never wanted to sue the company. But after complaining to Monaco, the city of Coburg and finally the Lane Regional Air Pollution Authority and other government agencies without success, the residents believed that they had no choice but to sue.

"This means clean air for people who stood up for their rights even though the EPA, DEQ and LRAPA couldn't do it," Paul said.

Pech said he's glad the controversy has been settled so he can turn his attention to more important issues. "We can all move forward now," he said. "In a business sense and in a moral sense, this was the right thing for (Monaco) to do."

Coburg-based Monaco appears to be the first RV manufacturer in the country to install toxic chemical fume burners, and experts said the company's move may be used by air regulators elsewhere in the nation to pressure the RV industry to clean up its toxic air emissions.

Many wood products factories, for example, already use incinerators to substantially eliminate toxic fumes from glue and other compounds. But because of quirks in federal air pollution law, the RV industry has largely escaped tough restrictions on its toxic air emissions from vehicle painting.

"This will certainly help show this industry can apply appropriate control technology without going bankrupt," Paul said.

The settlement with Monaco "certainly does set precedent," said Wood, an attorney with the Stoel Rives law firm in Portland. But the settlement alone "is not enough guarantee that everyone else in the country would have to" install fume burners, he said.

Many air pollution agencies nationwide require companies to install the best control technologies that are in use in their industry, so once one company adopts the most up-do-date controls, regulators begin pressuring others to follow suit.

Air regulators nationwide will probably use the Monaco settlement as evidence to pressure the RV industry to install similar burners at any proposed new RV factories, said Brian Jennison, director of LRAPA.

Wood said the burners will cost a total of about $1.7 million. Installation costs will probably boost that to $2 million, Jennison said.

LRAPA during the past year has urged Monaco to install the equipment. But Monaco resisted, asserting that the equipment would cost more than $7 million to buy and install and would cost $1.7 million a year to operate.

Jennison said he isn't sure how much the burners, which are fired by natural gas, will cost to run. But the cost will probably be many tens of thousands of dollars a year, he said.

Monaco has the money. For the first six months of this year, the company reported profits of $10.7 million on sales of $434.7 million.

Plus, under Oregon's pollution control tax credit program, Monaco will have to shoulder only half of the total cost. The rest will be shouldered by the state.

The program allows manufacturers who install pollution control equipment to apply to the state Department of Environmental Quality for tax credits within two years of the project's completion. Once the DEQ verifies the equipment is being used to control emissions, it authorizes a tax credit for half the total cost. The company uses the credit to offset state tax liabilities.

Monaco on Thursday declined to comment on the settlement. The company has declined to comment to The Register-Guard since last April, when the newspaper ran a series of articles detailing the Coburg plant's toxic air emissions and the more than $56,000 in fines that Monaco has paid LRAPA for violations of air pollution rules at the plant.

A scheduled trial between Monaco and the neighbors was looming closer when the two sides sat down for their relatively swift and brief negotiations.

Paul said the two sides first met Aug. 22 with Aiken acting as a mediator. That meeting wasn't fruitful, but Aiken urged additional meetings earlier this month that led to the settlement, Paul said. A trial in federal court had been slated for next May.