Contractor agrees to $6 million settlement over dirty engines

Chris Amico May 23, 2008, 8:37pm

Jerry Brown

SACRAMENTO, Calif. (Legal Newsline)-Bridge builder MCM Construction has agreed to a $6 million settlement with California Attorney General Jerry Brown to settle allegations the company used banned portable diesel engines on state-funded projects.

Brown said the settlement was the largest ever involving portable engines for which state law requires companies to obtain local permits for diesel cranes, pile drivers, and other portable engines.

MCM failed to get the required permits, and some of the company's machines were so old they predate the current air pollution regulations, a Ventura County official told Legal Newsline.

The state also alleged that MCM Construction damaged critical salmon spawning habitat while working at the Van Duzen River in Humboldt County.

The company deposited debris, silt, and pollutants into the river, violations of the Clean Water Act, Brown's office said.

Under terms of the settlement, MCM will pay $4 million in civil penalties, which will be split among state and local agencies. The company will spend another $2 million to upgrade its equipment and adopt an internal environmental auditing process.

The lawsuit started in Mendocino County, where local air quality agents found MCM operating diesel engines without the necessary permits.

Those officials alerted Ventura County, where MCM was building the Highway 101 Bridge over the Santa Clara River.

Michael Villegas, the Ventura County Air Pollution Control Officer told Legal Newsline that as soon as one district noticed MCM's outdated engines, which put out hazardous particulate matter and nitrous oxide, the company would simply move the equipment to another county.

"It became like a shell game, and that's why this case got so large," Villegas said in a telephone interview.

"This was happening throughout California," he added. "The overall excess emissions weren't huge, but the fact that they were doing this throughout out the state was the issue."

Companies working on state projects must adhere to environmental regulations and maintain up-to-date equipment, all of which costs adds to overhead costs. Prosecutors argued that by avoiding those requirements, MCM could have theoretically underbid competitors.

"The hope is that this judgment will send a message to construction community that portable equipment needs to be registered or permitted, that there will be consequences for failing to abide by the rules," Mitch Disney, a senior deputy district attorney in Ventura County, told Legal Newsline.

"We have no reservation about saying that MCM was made an example of. MCM was caught, and it was caught in spades. Prosecutors like to go after the low hanging fruit," he said.

Sacramento, Calif.-based MCM is one of the state's biggest bridge builders, completing more than 1,000 spans since it was founded in 1973, the company's Web site said.

Ventura and Mendocino district attorneys requested statewide documents from MCM, but the company resisted, agreeing only to give prosecutors records from their respective counties. That's when the attorney general was brought on board. Disney said.

Brown praised the ruling in a statement released Friday, saying the company's actions were "potentially very damaging to the environment."

"Under today's settlement the company will obtain the necessary permits and submit the equipment to careful inspection," the Democratic attorney general said in a statement.

When phoned for comment, an MCM employee referred Legal Newsline to a company statement that said the company "has always been committed to providing construction services to the People of the State of California in an environmentally conscious, clean and safe manner."

MCM called the $6 million settlement "fair and equitable to all concerned."

"It is hoped that this matter will serve to further educate both the construction industry at large, and air quality enforcement personnel, so that greater compliance with permitting regulations can be achieved statewide."

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