Controversial bill would have aided Missouri company under scrutiny for contamination

Two years ago, a company led by an influential businessman faced off with the state’s environmental regulators over whether it needed to do additional testing for a chemical health officials worried could pose a cancer risk to the company’s workers. 

The Moberly manufacturing facility, Orscheln Products LLC, is owned by the family of businessman Barry Orscheln, who serves as CEO of Orscheln Industries and chairs the Missouri Conservation Commission. He was recently named Gov. Mike Parson’s conservationist of the year. The company was resisting calls by the Department of Natural Resources to do more testing for a carcinogenic chemical called trichloroethylene, or TCE, that has contaminated the site for years.

The company argued DNR was overzealously enforcing federal hazardous waste testing guidance that wasn’t required by law or regulation. 

Soon the company’s complaints were reflected in legislation criticized as an attack on Missouri environmental regulation. 

As DNR faced off with Orscheln Management Co. over the Moberly site, previously known as ORBCO, the company’s attorney, Stacy Stotts, said the agency was “expanding its regulatory authority through the use of federal guidance without the requisite due process of a rule-making.” 

Two bills introduced in 2020, as the company and DNR went back and forth over whether the additional TCE testing was necessary, would have effectively barred the environmental agency from relying on the federal guidance it used in the Orsheln dispute. 

Both sputtered after COVID-19 derailed the legislative session.

This year, that language returned in Senate Bill 40, an omnibus environmental bill. 

The Missouri Senate passed the bill on a 23-10 party-line vote, and it sailed through a trio of House committees and was ready for final passage when time ran out and lawmakers had to adjourn for the year.

Neither Orscheln nor ORBCO were ever mentioned in public testimony or debate over the bill, and the company’s attorney would not clarify the company’s involvement.

The legislation’s sponsor, Sen. Eric Burlison, says his inspiration was tourist caves in his district dealing with similar contamination. 

But Burlison says after he introduced the legislation people came out of the “woodwork” with complaints about DNR. That includes, he said, former Sen. Kurt Schaefer, who is registered as a lobbyist for Orscheln Management Co. but never testified during public hearings.

Schaefer did not return requests for comment.

Ray McCarty, president and CEO of Associated Industries of Missouri, said the provisions were meant to target DNR’s use of guidance documents in enforcement, though he said the issue went beyond Orscheln.

Michael Berg, a lobbyist for the Missouri chapter of the Sierra Club, said the bill could have been “catastrophic to environmental law enforcement in the state of Missouri.” A company shouldn’t secretly use the legislative process to settle a dispute with state regulators, he said.

Others agreed.

“It’s concerning when it appears that we might be trying to change state law in order to benefit a handful of people,” said Rep. Tracy McCreery, a St. Louis Democrat who opposed the legislation.

To Burlison, who said he expects the legislation to return next year, the issue is about limiting the size of government. 

“Why in the hell would we allow them to be more strict than what the federal government is asking them to do?” Burlison said. “The state of Missouri, which is a pro-business state, should not be any more stringent than we have to be.” 

A dispute over TCE

TCE is a colorless volatile chemical commonly used to remove grease from metal parts. Employees at Orscheln and countless other manufacturers around the country used it for decades. 

According to the Agency for Toxic Substances and Disease Registry, part of the Centers for Disease Control and Prevention, TCE can cause kidney and liver cancer, non-Hodgkin lymphoma, cardiac defects, leukemia, multiple myeloma, renal disease, Parkinson disease and scleroderma. 

The chemical has also been linked more loosely with a number of other cancers and pregnancy complications.

Orscheln employees stopped using the chemical in the late 1970s, but it was discovered in the groundwater at ORBCO, or Orscheln Brake Lever Manufacturing Company, in 1988. The company entered a consent decree with DNR to clean it up under the department’s oversight in 1990. That agreement is still in effect, and Stotts noted the company is in compliance with that agreement. Orscheln has been treating and monitoring the groundwater on site for decades.

In 2019, the agency discovered TCE in sewer gas coming from nearby manholes.

It notified the company, and based on the results, said Orscheln was required to do additional testing to fully assess the risk of TCE migrating from the site to other properties and the risk to the company’s own workers from the TCE that was vaporizing and entering the manufacturing facility through the air. 

A subsequent assessment from the Missouri Department of Health and Senior Services found there wasn’t enough data to assess the risk to human health. Health officials recommended further testing. 

That kicked off a months-long dispute over Orscheln’s responsibilities. 

DNR found the testing plan Orschlen submitted incomplete. But the company thought the extent of the contamination had been fully assessed already. The company told DNR it would take steps to mitigate TCE in the sewer system and disagreed that the chemical posed a threat to human health.

“Again, the groundwater is delineated and is stable and decreasing, and there is no indication that the plume has migrated offsite, which is supported by MDNR’s recent investigation,” Tom Hall, Orscheln’s environmental health and safety manager, wrote in a letter on Dec. 4, 2019, to Valerie Wilder, who leads DNR’s superfund program.

Wilder replied in a letter to Hall, that the plan would “not provide sufficient information to determine whether human exposure is occurring at or beyond the ORBCO facility.” She went on to say in a letter that if the company did not do the requested work, it “may leave the department no option but to obtain an order compelling Orscheln to submit complete, adequate work plans and perform the required work.”

After that letter, Orscheln’s leadership stopped corresponding with DNR, turning instead to its attorney Stotts, who wrote back to DNR asking for clarification on part of the testing it requested and pushed back against DNR’s warning. 

“Again, Orscheln respectfully believes that any action by MDNR to issue an order based on prescriptive application of guidance that has not been issued in a regulation is an expansion of MDNR’s authority and is not appropriate for the site,” Stotts wrote on Jan. 24, 2020.

Why in the hell would we allow them to be more strict than what the federal government is asking them to do?

– state Sen. Eric Burlison

Stotts wrote to DNR in February of 2020 that while Orscheln still disagreed with DNR over whether it was overstepping its authority, the company would submit a plan in compliance with DNR’s request.

Stotts said in an email to The Independent the concern about DNR’s use of guidance documents was one shared by other environmental attorneys, scholars and businesses.

“The law and court decisions have long prohibited creating legal obligations through guidance, considering it a violation of due process,” she said in a statement to The Independent. “Said another way, the government may not effectively bind the public through guidance that has not gone through the notice-and-comment rule-making process.”

In a statement, DNR said the correspondence between the agency and the company “speaks for itself” and did not respond to the accusation that it was expanding its authority.

A year after Stotts objected to DNR’s use of the guidance document, the same complaint came up during discussion of Burlison’s bill.

“Guidance documents are not statute,” McCarty, the president and CEO of Associated Industries of Missouri, told the House Emerging Issues Committee in May. “They are not regulation. They are not vetted. They are not put out by elected officials. They’re put out by unelected bureaucrats.”

John Madras, a former DNR employee who worked on hazardous waste issues, said guidance documents typically contain the most up-to-date recommendations on mitigating environmental harm rather than waiting for agencies to adopt new rules. 

While the methods in those guidance documents aren’t mandated, Madras said they will ensure a company, like Orscheln, identifies all the contamination and gets it cleaned up rather than discovering down the road that it missed something. 

Hall said the plume of TCE on the site was stable and shrinking. But Madras pointed out the high concentration of TCE vapor in the air.

“If they looked below the floor … they would probably find a boatload of the TCE down there; it used to be a fairly common industrial solvent that people used all over the place,” Madras said. 

He called it “almost criminal” that workers have been in those buildings for decades. 

TCE exposure for workers

After Orscheln performed some sampling work in 2020, DHSS once again assessed the risk of unhealthy exposure to workers. 

This time, health officials found “TCE concentrations in the manufacturing building exceed the comparison value for cancer effects for worker exposure in all areas except the office area.” 

The assessment included a caveat that the sampling for TCE at Orscheln gave officials a snapshot in time, but levels of TCE vapor can vary over time. The agency recommended informing workers about the risks, performing additional sampling and looking for ways to mitigate the vaporizing of TCE from the decades-old contamination underground. 

The company also hired a toxicology consultant to review the 2020 sampling results and disagreed with DHSS’s methodology, Stotts said, which relied on general assumptions about the amount of time workers spend in various parts of the building rather than the company’s site-specific practices. 

Stotts said the assessment, which she did not provide to The Independent, found TCE concentrations well below standards set by the Occupational Safety and Health Administration and the American Conference of Governmental Industrial Hygienists. Elevated levels of TCE were found in two low-traffic areas and have already been mitigated.

But DHSS warned in its consultation that OSHA sets limits on TCE and other chemicals that are in “active use or production and the workers are aware of the exposures and receive specific protection and training to mitigate exposures.”

“For ORBCO, since the source of TCE in air is from environmental contamination and not from current use or production of TCE, OSHA standards are not applicable in this instance.”

Stotts said “ensuring the safety of employees is Orscheln’s main priority.”

‘An attack on the environment’ 

Senate Bill 40 was criticized by environmental advocates as an effort to hamstring and defund DNR by limiting its oversight of hazardous waste and revoking several commissions’ authority to set permit fees. 

“No matter how you look at it, it was really an attack on Missourian’s health and an attack on the environment, ” McCreery said. 

The bill’s provision barring DNR from deviating from federal regulations in its enforcement of hazardous waste regulations was inspired by its enforcement of TCE contamination, Burlison said at the time. He cited tourist caves in Southwest Missouri that had to address TCE that had migrated their way from other sources of contamination.  

Burlison said while the caves weren’t the source of TCE, they were bearing the burden of cleanup and instructed to turn around and collect from the upstream polluters. He said that pitted businesses against businesses. 

Fantastic Caverns, which has had to mitigate TCE that migrated from a former manufacturing facility owned by Northrop Grumman, declined to answer questions about the bill. 

McCarty said in an interview with The Independent that at least seven or eight businesses were affected by the same issue facing Orscheln but declined to name them. Orscheln was listed as a member of Associated Industries’ “Circle of Elite Organizations” on the trade group’s website. 

“I can’t really say anything about particular members because we represent an entire association of businesses,” he said, “but I have heard from way more than one.”

Orscheln was not available for an interview, according to his attorney.

“As a company, Orscheln has worked collaboratively with DNR since the late 1980s when Orscheln self-reported the TCE detections on site, has been in full compliance with the consent agreement and has gone above and beyond the scope of the consent agreement while maintaining employment for more than 300 Misourians,” Stotts said in an email to The Independent. 

DNR declined to “speculate” on how Senate Bill 40 would have altered its ability to respond to vapor intrusion.

Both McCarty and Burlison are hopeful lawmakers will approve a version of Senate Bill 40 during the 2022 legislative session.