ROANOKE TIMES
Copyright (c) 1995, Roanoke Times
DATE: Sunday, December 24, 1995 TAG: 9512270068
SECTION: VIRGINIA PAGE: A-1 EDITION: METRO
DATELINE: NORFOLK
SOURCE: CATHRYN McCUE AND DAVID M. POOLE STAFF WRITERS
For Peter Schmidt, Campostella landfill was a chance for his fledgling company to show how fly ash residue from coal-fired power plants could be recycled in an environmentally sound way.
Schmidt and his company, Agglite Corp., persuaded the city of Norfolk to use 200,000 tons of ash to help transform the old dump into a city park. But the project turned into a fiasco in March 1994, when torrential rains turned the powdery ash into a gray sludge that oozed knee-deep into the surrounding neighborhood and clogged two areas of federally protected wetlands.
"It was the worst stuff you ever saw in your life," recalls Bill Bailey, part owner of a truck repair shop across from the landfill in South Norfolk.
After the washout, the state Department of Environmental Quality found that the parties involved in the landfill closure had disregarded environmental safeguards to save time and money.
Agglite's role at Campostella went unnoticed because, at the time, Schmidt was a little-known executive of a concrete company. Three months later, Gov. George Allen tapped Schmidt to head DEQ and to make the state's environmental watchdog agency more accommodating to business.
The events at Campostella provide insight into the pro-industry perspective Schmidt brings to his public job, a perspective that, according to a report issued this month, has thrown DEQ into turmoil. A survey by the Joint Legislative Audit and Review Commission found that half of DEQ employees think the agency is failing to protect the environment and that their jobs would be in jeopardy if they made a decision consistent with the law, but which upset a polluter.
Schmidt, responding to the survey, cited statistics that he said showed that the environment is improving. He said morale problems in his agency stem from growing pains under a reorganization plan.
He declined to comment about his role at Campostella, because his former company, Agglite, is being sued for $500,000 by a Roanoke-based contractor who worked on the landfill.
The contractor, Allegheny Construction Co., contends in Chesapeake Circuit Court that Agglite provided the fly ash - enough to bury a football field under 150 feet - but didn't tell the contractor that DEQ required some to be hardened with cement to prevent erosion.
Agglite's attorney, Stanley Barr of Richmond, said no contract existed between the two companies; instead, there were a few letters and a verbal agreement. If any ash had to be mixed with cement, Agglite would have done it, Barr said.
But exactly how, and when, stabilized ash was used remains in dispute.
Environmentalists were skeptical when Schmidt, who was president of Agglite, was appointed to DEQ in June 1994, particularly when they learned that Schmidt's business ventures had a mixed record on environmental compliance.
One of his companies, Allied Concrete, ran afoul of state law in 1988 when it expanded a cement plant in Suffolk without installing bag houses to catch air emissions.
"We thought more about making block than getting permits. We made a mistake," Schmidt acknowledged in an interview last year.
Schmidt was more dutiful about keeping regulators informed about Agglite, which was dealing with an unproven material and was looking for the state's seal of approval to win over contractors. The company had a patented formula for using fly ash to make lightweight concrete. Schmidt also was looking to expand into new markets, such as providing fill beneath roads, golf courses and subdivisions, but state regulators had yet to come up with standards for using fly ash.
Barbara Wrenn, a Richmond-based environmental consultant who has worked for Agglite, said that in the absence of clear regulations, the company always sought written instructions "down to the detail" from DEQ on handling ash.
"They know they're using a controversial material," Wrenn said.
Fly ash is a lime and silica compound filtered out of coal-burning power plant emissions. It contains traces of heavy metals far below hazardous levels set by the DEQ and the federal Environmental Protection Agency, which have classified it as nonhazardous.
Still, fly ash is a waste disposal headache for utilities. In Virginia alone, power plants crank out a million tons a year.
Under a contract with Virginia Power, Agglite hauls away about 100,000 tons of fly ash a year that otherwise would be dumped into a giant industrial pit. Agglite is paid $10 a ton.
"Agglite has done a marvelous job of finding uses for the stuff," Virginia Power spokesman Bill Byrd said.
For Agglite, the Campostella landfill represented an opportunity to win over regulators and to further Schmidt's goal of turning fly ash into a profitable venture.
But state waste management officials, who had never approved fly ash to close a landfill, were skeptical about Campostella. They suspected that, despite Agglite's claims about recycling, the company really looked at Campostella as a cheap way to get rid of ash.
"There was an interpretation that what they were talking about essentially looks like disposal," said Walt Gulevich, assistant director of the DEQ waste division. "In other words, if it quacks like a duck, it's a duck."
Campostella was Norfolk's dumping ground for more than 50 years, until it stopped accepting municipal waste three years ago. The landfill - surrounded by a school and a housing project - stands as a bleak monument in Carver Manor, a neglected neighborhood on the Norfolk-Chesapeake line.
In 1990, state waste management officials began pressuring Norfolk to close and monitor the facility under new environmental regulations.
City officials decided to fill a 50-foot ravine that ran through the center of the landfill, harboring vermin and criminal activity. The city planned to turn the leveled-off dump into a 40-acre park patterned after "Mount Trashmore" in Virginia Beach.
Planning was still under way in 1991 when Schmidt and Agglite approached the city. Instead of using costly soil, the company suggested filling the ravine with fly ash. Norfolk would save money, and Agglite would make money.
After two years of negotiations with Norfolk and its project consultant, Draper Aden Associates, DEQ gave the go-ahead to use fly ash. To reduce erosion and dust problems, the agency required that every 5 feet of the talcum-like ash had to be sealed between 6-inch layers of an ash-cement mixture.
But the city departed from the plan from the start. Draper Aden directed Allegheny Construction to topple construction debris buried in the landfill into the ravine. Allegheny mixed the fly ash with the cinder blocks, drywall, roof shingles and other debris to fill the ravine, contrary to the DEQ plan.
Although Agglite had no hands-on role in the construction, the company raised no objections when the city's consultant and contractor disregarded several parts of the closure plan. Then, one month into the project, Agglite worked a deal with Norfolk and the contractor to double the amount of ash used to close the dump.
"They were moving a lot of material quickly in there," said Steven Dietrich, a senior DEQ engineer.
Several months into the project, Schmidt's partner, James Izard, wrote DEQ regulators about ash placement at Campostella. But neither Schmidt nor Izard mentioned the mixture of ash and debris until after things went awry.
A week after the washout, Schmidt wrote DEQ suggesting that the state adopt rules to allow mixing ash with debris in landfill closures. At the time, Schmidt served on a panel that was drawing up recommendations on fly ash standards for the state's approval.
But Dietrich later concluded that mixing debris with ash does not result in stabilized ash.
"If it was done the way it should have been, you wouldn't have had the washout," or at least not as severe a washout, Dietrich said recently.
There were warning signs that fly ash was a problem at Campostella. In January 1994 - three months into the project - nearby residents and businesses began to complain about ash from the landfill flowing onto Berkley Avenue after each significant rain. The ash would dry, then coat houses, cars and lawns in dust. Norfolk inspectors ordered Allegheny to repair fences that retain silt runoff and to water the road to suppress the dust.
On March 3, the skies opened over Norfolk, dumping nearly 4 inches of rain. At noon, a massive ash flow broke loose from the site and ran into the neighborhood like lava from an erupting volcano. Despite quick action to control further runoff, heavy rains a week later again washed ash off-site.
"It was just like pouring a gallon of soup on the kitchen floor," said Bailey, the co-owner of Baywest Transport truck repair shop.
It took him six months to clean up the maintenance yard. As the muck dried, he and his workers couldn't avoid breathing the dust. "They swore up and down it wasn't" harmful, Bailey said. "But it's the age-old thing - what happens to you 10 years from now?''
In the meantime, Bailey settled out of court with Allegheny for damages, cleanup costs and down time. Allegheny, in its lawsuit against Agglite, is seeking $104,000 reimbursement for settlements with adjacent property owners.
DEQ and Norfolk are close to signing a consent order that could include civil penalties of up to $30,000 against the city.
Norfolk also has submitted a restoration plan for the wetlands to the Army Corps of Engineers. Immediately after the washout, most of the muck was scooped up and put back in the landfill, which now is capped off and covered with grass. But the wetlands still must be restored, said Jennifer McCarthy with the corps.
Agglite faces no enforcement action because the company had no legal responsibility as a subcontractor or supplier to make sure Campostella was closed correctly.
Barr, the Agglite attorney, put it this way: "Agglite did not have any control over the manner in which the landfill was being closed."
But Agglite was more than a supplier. The company came up with the idea of using fly ash and was the only expert involved in the project. The company failed to provide enough stabilized ash, according to DEQ records. And Agglite persuaded the city to double the amount of fly ash and recommended a way to provide it without adding cement.
DEQ officials found that the closure proceeded in a way that gave everyone involved an incentive to cut corners. Norfolk officials wanted to bring the project in under budget and on time. Allegheny faced pressure to hold down costs and meet its deadline. Agglite sought to place as much fly ash as possible at the site.
Harold Winer, a waste management official at DEQ's Tidewater region, wrote that ``..the deviations were intentionally done with the idea of circumventing regulatory requirements to save money."
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