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Oh, well then, no problem

elkriver

A chemical plant in West Virginia, for a company called Freedom Industries (there’s a name that screams last refuge of scoundrels for you), spilled about 5,000 gallons of 4-methylcyclohexane methanol into the local water table. It turned the water in the rivers blue-green and reeking of licorice. The safety sheet for this chemical has a few cautions.

36: Irritating to the eyes
37: Irritating to the respiratory system
38: Irritating to the skin

26: In case of contact with eyes, rinse immediately with plenty of water and seek medical advice
27: Take off immediately all contaminated clothing
28: After contact with skin, wash immediately with plenty of … (to be specified by the manufacturer)
29: Do not empty into drains
30: Never add water to this product
33: Take precautionary measures against static discharges
35: This material and its container must be disposed of in a safe way
36: Wear suitable protective clothing
37: Wear suitable gloves
39: Wear eye/face protection

I like how the treatment suggestions include rinsing immediately with water. What do you do when the water is tainted with this stuff?

But don’t panic! The director of the West Virginia Water Research Institute is telling everyone not to worry.

Even at its current concentrations, however, the chemical is unlikely to cause any serious harm, Ziemkiewicz said.

“You’d have to drink something like 1,700 gallons of water to even approach a lethal dose,” he said. If a person drank a glass or two of tainted water, “I would be astonished if that caused any serious problems.”

Seriously? They’re simultaneously telling everyone to not drink the green water, don’t bathe in it, don’t wash your babies with it, and hey, the green stinky chemical contaminants coming out of your tap are just fine? Perhaps Ziemkiewicz would like to define “serious”. It seems to be something along the lines of “you’re not dropping dead, your glass of water is just making you vomit.”

Our expectations of what it means to live on a habitable planet seem to be dropping. I don’t think the head of an institute dedicated to researching clean water ought to be downplaying the toxic effects of the coal industry on water quality in the region. But that’s just me.

At least we aren’t getting the Ayn Rand approach to environmentalism yet, which would argue that the chemical tint to the water increases its scenic value, and that that odor is the scent of prosperity.

And we’re only getting a little bit of an effort to tie environmental disasters to biblical prophecy.

So sure, it could be worse. The whole planet could be exploding, but all we’re doing is soaking it with toxins. You could be melting and dying in agony right now, but really all that’s happening is that you’re drinking a slow poison.

Relax.

All misery is relative.

Don’t let the little things bother you, like dilute chemical irritants in your drinking water.

Shut up.

Go fight the big problems, like exploding planets and melty death. Let the little ones slide.

Really. Hush. It’s a little problem.

You can trust a company called Freedom Industries, can’t you?

Comments

  1. numerobis says

    I’m curious how the water is blue and licorice-scented but safe at 1ppm. I love licorice, so maybe I should get a vial of this stuff?

  2. cswella says

    Similar naming strategy as the auto shop I used to live near, called Honest Autos. They were the complete opposite of honest.

  3. chrishall says

    26 and 30 seem to be at odds with each other, and I’m not reassured by:

    “28: After contact with skin, wash immediately with plenty of … (to be specified by the manufacturer)

  4. amylacc says

    I’d bet that this company is not going to have to pay a dime to clean this up. They should have to pay not only to clean it up, but to provide drinking water to the people affected. I’m guessing, though, that the government will be on the hook for that. Privatize the profit, socialize the risk.

  5. says

    From Think Progress:

    […] According to the National Library of Medicine, repeated or prolonged exposure to the chemical, 4-Methylcyclohexane Methanol, can “cause headaches, irritation of the eyes, nose, and throat, and can also cause a skin rash.”[…]

    1. No one knows when water will be safe to drink again. […] the spill impacts the entire distribution of the water system — sending water to a total of 1,500 miles in the area.[…]

    2. No one knows when the leak started or how much has leaked into the Elk River. […]

    3. The water company has had no contact with Freedom Industries, the company that manufactures the spilled chemical. According to McIntyre, the company provided no notice of the spill and hasn’t been in communication with the water company since.

    4. There is no standard process for testing the toxicity of the spilled chemical in water. […]

    5. It’s unclear just how dangerous the diluted chemical is to drink or breathe.[…]

    6. The chemical may have leached into the soil. McIntyre said that when the containment in the chemical holding tank failed, the chemical traveled over land and into the Elk River. That could have caused some leaching, he said.[…]

  6. magistramarla says

    This happened in a reliably red state, where the cons have convinced the voters that EPA = bad and that regulations on corporations is bad for the economy. I wonder whether this will change some voters’ minds?

  7. Artor says

    Considering what I know of West Virginia, I assume that the director of the West Virginia Water Research Institute was installed by the mining industry as a friendly voice for their interests. It’s just awfully convenient, (heavy on the awful) that he can also be a friendly mouthpiece for the chemical industry too.
    “Freedom Industries,” really? I guess that would refer to their freedom from any meaningful environmental regulations?

  8. isoetes says

    I live in Charleston and have some more information. Not much is known about the chemical (other than LD50) since it is not regulated. Apparently the LD50 is that 825 mg ingested per 1 kg weight of a rat. this puts it in the mild to moderately toxic category, BUT is is not known if it is carcinogenic since it’s never been tested. The recommended safe level for drinking water is a guess, I assume based on similar chemicals.
    The water company’s intake was about a mile downstream from the plant. When the water company was initially told about the leak, they were given the wrong chemical name, a chemical that could be treated by just beefing up their regular treatment. It wasn’t until the chemical was in the system did they realize that the treated water was contaminated. It was another hour or two before the warning was sent out to the public.
    And yes, it appears that the company owners are as crooked as the name implies. To our embarrassment, they attended the college where I teach. Not sure if they have a college degree though.

  9. says

    But the real victim here is clearly the president of the company:

    He also said more than once that it had been a “long day” for him and others at the company. After six minutes, Southern attempted to leave the news conference but was asked more questions.

    “Look guys. It has been an extremely long day,” Southern said. “I have trouble talking at the moment. I would appreciate if we could wrap this thing up.”

    The news conference ended a few minutes after that.

    Six minutes. What kind of monster expects a guy to answer questions for longer than that?

  10. Rey Fox says

    I guess that would refer to their freedom from any meaningful environmental regulations?

    That’s libertarian freedom, the freedom from externalities. Meanwhile, if your drinking water is no longer safe, then you have the freedom to find other drinking water. And the freedom to stop financially supporting the chemical company…somehow or another, you have the freedom to see if you purchase any of their products directly or indirectly, you have the freedom to examine their entire supply and distribution chain. And the freedom to move away if all else fails.

    Freedom!

  11. says

    Area Man quoth:

    He also said more than once that it had been a “long day” for him and others at the company.

    Oh, poor baby. Here in ND, there was train derail and collision about 120 miles from me. A town needed to be evacuated and oil personnel needed to deal with the explosion and fires. There was a crew here from Arkansas, who were out all night working in sub-zero temps. Now they had a long fucking day.

  12. says

    According to the Republicans, chemical spills like this are far, FAR safer than government regulation. And if you get sick anyway, well, you have the right to sue. But not as a class action, please: that would be socialist.

  13. smhll says

    Freedom Industries (there’s a name that screams last refuge of scoundrels for you)

    If they jiggered the name to Freedom Through Working Industriously it would sound more Nazi-ish. Just a thought.

  14. What a Maroon, el papa ateo says

    You can trust a company called Freedom Industries, can’t you?

    I believe it used to be called French Industries.

  15. says

    If it smells like licorice, it has to be bad. Licorice has a medicinal smell, like something you drink to make you throw up after swallowing poison…or poisoned water.

  16. says

    New rule: Anytime a company causes a chemical spill, the board of directors have to clean it up personally… with their tongues.

    I suspect we’d see a sudden increase in voluntary safety measures.

  17. lorn says

    On the up side Freedom Ind lists “water treatment” as one of its services.

    http://www.freedom-industries.com/products.html

    So don’t think of this as a problem. Consider it a business opportunity. Now that this muck is in the water Freedom Ind will gladly sell you a water treatment system to take it out for you, at a nominal cost.

    This is the way of business. Credit card companies were told many years ago that the security system they used was inadequate. Their response is to open up subdivisions of their main business to sell you enhanced security.

    Every failure is an opportunity to extract maximized profit in return for a minimized level of actual performance.

    For $2 the brake shop will sell you a wooden wedge to stop your car from rolling on hills. For $10 the roofing company will sell you an umbrella to keep the rain out of your soup during meals.

    We have become a nation of hucksters and charlatans.

  18. sigurd jorsalfar says

    Everything will be fine if you don’t drink the water. But if you do drink the water, everything will be fine. What’s so hard to understand?

    I’d like to see Ziemkiewicz drink a couple glasses of this water on national television. I bet he will have as much difficulty swallowing it as Mr Burns had swallowing three-eyed fish.

  19. ck says

    At this point, it might be good if companies were merely required to pay the judgement in lawsuits against then instead of having them whittled down to almost nothing, and then refuse to pay even that meager sum after all the appeals are finished. Apparently, it took until the end of 2009 before Exxon finally paid the $507,500,000 punitive damages (down original from $5,000,000,000 thanks to the US Supreme Court) for the Exxon Valdez spill of March 1989.

  20. Rich Woods says

    @LykeX #21:

    New rule: Anytime a company causes a chemical spill, the board of directors have to clean it up personally… with their tongues.

    I am all in favour of applying this rule to offshore oil spills too. With no lifejackets allowed.

  21. Rey Fox says

    Anise oil smells like licorice, and it causes mild skin irritation, which I found out when I put a container of it in my pants pocket while setting out bear baits for a Fish & Game census.

  22. mouse says

    I’m researching for a blog on this. For a solid 24 hours the most anyone from the company said came from the owner’s girlfriend on Facebook. I checked it out and it was astonishing. She was primarily whining about how harshly people were criticizing the company, and emphasizing that it was an accident. She says really dumb things like “no one and no thing” was hurt, noting that she saw some duckies swimming, and that she took a shower and hadn’t died, so there you go – safe for all! A disturbing number – all – of her friends echoed the “accidents happen” theme, sent prayers not to those who might be affected but to the owners, and expressed the sentiment that people who “choose” to live in “chemical valley” and in coal country should know that they’re surrounded by chemicals and just get over it. Eat shit and smile because coal is king.

    This spill disrupted the lives of hundreds of thousands, cancelling events, closing schools and daycares, halting scheduled surgeries. But please, have some sympathy for the poor company president and his beleagered girlfriend, will you!

  23. cato says

    PhD chemist here. The company is probably shit and I hope that they’ll be hit by very uncomfortable fines/jail sentences (even though they probably won’t). That being said…

    Forget about the safety sheet. It’s bullshit. These are the standard minimum warnings that companies slap on *everything*. There was a case a couple of years ago where a company put almost all of the above warnings on bottles of very pure water. I do not personally know the chemical but judging from its structure and the LD50 quoted above, I agree with the statement from Ziemkiewicz. There is very little risk that something would happen to people drinking the water but that’s still a risk you’d rather avoid. You could get a rash when exposed to it by showering, for example. But it’s rather difficult to convey a chemist’s risk assessment: “probably fine but don’t drink it, JUST IN CASE” to non-chemists (even if they’re biology professors :-).

    P.S. All of the above statements only refer to a contamination with 4-methylcyclohexane methanol alone. If it is true that the rivers are green, the colour has to be from something else which might me much more toxic.

  24. chrisv says

    It is a bit hard to tell from the pictures I have seen, but it appears that the tanks are not in berms. If the leaking tank were situated in a berm,the leak should have been contained.

  25. ochemgradstudent says

    I agree with cato, above. The MSDS is not going to be very helpful, generally. The one for sand sounds pretty scary. That’s a result of federal regulations that are probably for the best, but does mean that the safety sheets make it hard to tell what’s dangerous and what’s just kind of annoying, especially if you’re not a chemist.

    Something that greasy is going to be very poorly soluble in water (cLogP is measured via octanol/water split), and it will probably be a very viscous clear oil. If the river has turned green, it’s not just the (4-methycyclohexyl)methanol, there’s something else in there. I order a lot of chemicals, and I have never heard of this company, so I imagine they’re a minor player and also quite terrible. Sounds like an inadequate secondary containment set-up, so a fine is probably in order. And one hopes the company would be responsible for the cost of clean-up.

  26. says

    …and expressed the sentiment that people who “choose” to live in “chemical valley” and in coal country should know that they’re surrounded by chemicals and just get over it. Eat shit and smile because coal is king.

    And it’s a good thing, because without coal, West Virginia would be a rather poor state, possibly somewhat lower than its current 49th GDP per capita ranking. And places like eastern Kentucky, central Pennsylvania, and northern Missouri would have to face the horror of persistent poverty and underdevelopment if it weren’t for the miracle of coal. Come to think of it, is there any coal-rich region of the country that is not just rolling in money?

  27. Ichthyic says

    Pretty toxic, West Virginia
    Tainted mountains, polluted rivers.
    Life is dead there, deader than the trees
    deader than the fishes, floatin’ down the streams.

    Coal Industry, take me home, to the place I belong.
    West Virginia, mountains chopped off, take me home, Coal Industry.

    I hear a bullhorn
    in the mornin’ hour announcing.
    The radio reminds me of the water I can’t use.
    And the smell down the road gives me a feelin’
    that I should have left here yesterday, yesterday…

    Coal Industry, take me home, to the place I belong.
    West Virginia, mountains chopped off, take me home, Coal Industry.

  28. Ichthyic says

    Missouri would have to face the horror of persistent poverty and underdevelopment if it weren’t for the miracle of coal.

    you could say the same thing about OZ.

    with all the same fictions attached.

    the people of these states never profited from this industry… only those who owned the mines really profited.

    stop promoting the fiction. YOU didn’t fucking grow up in a coal mining town, and neither did I.

  29. unclefrogy says

    I did a quick look for poverty in West Virginia looks it is still there and just as persistent as ever
    so much for the benefits of coal.
    uncle frogy

  30. Holms says

    #4
    I hope our horde members in the area are alright.

    …But not the non-horde members in the area?!
    [/smartarse]

    #6
    2. No one knows when the leak started or how much has leaked into the Elk River. […]

    From wiki, the latest estimate is 28,000L, spilling from a tank with a maximum capacity of 150,000L. I have seen no word on how much of that capacity was in use, and of course estimates may be further revised. Apparently the leak started Jan 9, and was detected later that same morning, but no word from the company itself – authorities were only alerted by residents noticing a sweet smell and discoloured water.

    Oh, better still is this bit:

    “According to the company’s president Gary Southern, workers began cleanup immediately by hauling away the remaining MCHM in the storage tank and vacuuming the spilled MCHM from the ground nearby. The West Virginia Department of Environmental Protection, whose inspectors discovered the leak at 11:10 a.m. in response to residents’ complaints about the odor, contradicted Southern’s claim. When the department’s inspectors arrived at the facility, they witnessed the MCHM leaking through a concrete block containment dike with no cleanup or containment measures underway.”

    So, fuck those lying shitbags. Obviously more concerned with covering their arses than effecting a decent response.

  31. Ragutis says

    What a Maroon, el papa ateo

    11 January 2014 at 1:17 pm (UTC -6)

    You can trust a company called Freedom Industries, can’t you?

    I believe it used to be called French Industries.

    You win! Would you like the kewpie doll, the goldfish, or the Lynyrd Skynyrd mirror?

    Apparently, it took until the end of 2009 before Exxon finally paid the $507,500,000 punitive damages (down original from $5,000,000,000 thanks to the US Supreme Court) for the Exxon Valdez spill of March 1989.

    And how many hundred billions did they make in those 20 years? I can’t wait to see how little BP ends up paying.

    I’m pretty sure Led Zeppelin paid more for trashing hotel rooms than these banks and corporations end up paying for trashing huge swaths of the environment and disrupting, even endangering, thousands and thousands of lives.

  32. Ragutis says

    Blech, Screwed up that blockquote, For that I’ll let you choose two prizes, What a Maroon.

  33. Ogvorbis: Still failing at being human. says

    This is yet another example of how effective regulation can lead to deregulation.After commercial dam breaches, such as Buffalo Creek and Estes Park, the federal government cracked down hard on mine settlement dams. There have been no major breaches in forty or so years, so of course the mining industry is pointing at their wonderful safety record and asking that the regulations be eliminated. Forty years ago, orange creeks and rivers, hell, even burning rivers, were a part of the American landscape. Now water pollution is far less than it was because the industries have been following the rules and they are eliminating, piece by piece, the regulations that cleaned up the Merrimack, or the Potomac, or the Cuyahoga. Smog, air pollution, has been reduced to the point that most of us are never aware of any problems so, of course, the coal industry points at the blue sky and asks why they are burdened by unnecessary regulations. Same for vaccines, food inspection, health and safety laws in restaurants, industry, stores. Effective regulations have been so effective at eliminating so many of these industrial and medical hazards that the American public is, for the most part, fine with eliminating the regulations in order to ‘create jobs’. And I have no idea how to counter that.

  34. Esteleth, [an error occurred while processing this directive] says

    That’s very true, Oggie. My dad spent many years as a kid in Cleveland (he turned 18 in 1976, for context). When I learned about the “burning Cuyahoga” thing, I asked him if he remembered it.

    His reply: “Which time?”

  35. ck says

    Ogvorbis: Still failing at being human. wrote:

    Effective regulations have been so effective at eliminating so many of these industrial and medical hazards that the American public is, for the most part, fine with eliminating the regulations in order to ‘create jobs’. And I have no idea how to counter that.

    I’d just like them to prove their claims that eliminating regulations will create jobs. I don’t want pie-in-the-sky blathering about the invisible hand of the market, nonsense about how increasing profit will allow them to grow the company, or any other glibertarian talking points, but rather concrete data on which jobs were not created because of regulation (I suspect there are few to none of these). If, by chance, there is lost business opportunity because complying with regulation takes too long (like due to a shortage of authorized inspectors), maybe we can fix that instead of eliminating the regulation altogether.

  36. says

    @Ck

    They also very VERY much ignore the fact that regulations intrinsically will create jobs.

    Safety inspector is a job
    Manufacturing for filters and other safety materials create jobs
    R&D for materials and methods to increase safety and health create jobs

    Both private and public sector jobs are created. The real thing is they hate the public jobs so much nothing else matters

  37. ck says

    Ingdigo Jump wrote:

    Both private and public sector jobs are created.

    Of course. The problem is that there likely are a few old regulations that need to be updated for modern times, and that is used as a justification for eliminating all of them. I’m not insensitive to the idea that there could be some regulations that are highly obsolete that need to be revised or perhaps even eliminated, but that “we’ll create unspecified jobs if this regulation is eliminated” shouldn’t fool anyone.

    I have to admit that the rebranding of the wealthy elite as “Job Creators” was an impressive work of propaganda, as if these people create new jobs out of the goodness of their hearts rather than out of necessity to maintain their business empires.

  38. paulburnett says

    Mouse (#27) wrote “Eat shit and smile because coal is king.”

    Coal fired power plants emit far more radiation than nuclear power plants, from naturally occurring radioactive isotopes in the coal of (primarily) potassium, as well as uranium,thorium,radiumandradon.

    Other naturally occurring toxic elements emitted from coal fired power plants include lead, cadmium and arsenic. Coal fired power plants are the largest source of mercury pollution in America, responsible for approximately 50% of all human-caused mercury emissions.

  39. Ogvorbis: Still failing at being human. says

    @Ingdigo Jump:

    yeah but if a regulation is so obsolete as to have no effect why bother repealing it?

    Not saying this regulation exists, but, for example, a regulation requiring railroads to report the amount of coal ash disposed of each year, or requiring delivery drivers to keep a log of how often, and where, their horse took a shit. There are some weird laws still on the books (Hagerstown, MD, has a law forbidding crossing a street via a rope strung between two buildings), but very few of them affect business in any way. Unfortunately, the laws they want repealed are the ones that only look unnecessary because the law exists.

  40. says

    the people of these states never profited from this industry… only those who owned the mines really profited. stop promoting the fiction. YOU didn’t fucking grow up in a coal mining town, and neither did I.

    I know sarcasm doesn’t always translate well in writing, but I thought it was obvious here. My point was that, for all its pretenses of giving good jobs to hard-working mining community folk, the coal industry creates very few actual jobs, provides no job security of any kind, and coal mining regions are almost always dirt poor. The best thing that could be done for coal miners is to relocate them to somewhere that doesn’t have coal.

  41. says

    From the NY Times:

    At least 122 people have gone to local hospitals reporting nausea and vomiting, state officials said on Saturday. Five people were admitted at two hospitals.

    About 7,500 gallons of chemical was spilled into the river, about 2,500 more than previously estimated, said Mr. Dorsey, the state environmental official.

    So, worse than initially reported, and it is already making people sick.

  42. Ichthyic says

    I know sarcasm doesn’t always translate well in writing, but I thought it was obvious here.

    you’re right. it was late when I first read that, and had actually just come off of many facebook pages defending mining in West Virginia.

  43. Ichthyic says

    I have to admit that the rebranding of the wealthy elite as “Job Creators” was an impressive work of propaganda,

    yup.

    that it was. perhaps the most successful ever.

    but then, there is good evidence this kind of propaganda has been going on for literally centuries.

  44. unclefrogy says

    why yes job creators do create jobs
    low paying jobs here and lower payed jobs some where else where ever they can get away with
    it. Besides the pollution listed for coal burning power plants there is the wonderful modern method of mountain top removal that is turning coal country into a reclaimed land fill

    we have to be the dirtiest most destructive animal that has ever existed
    uncle frogy

  45. Thumper: Token Breeder says

    I like how the treatment suggestions include rinsing immediately with water. What do you do when the water is tainted with this stuff?

    My thoughts exactly. Jesus. It’s true, as cato says, that when it comes to toxins dosage is key, but this is still a serious fuckin’ problem.

    Icthyic wins the thread @#33.

  46. David Wilford says

    I’m dismayed by the fact that the water company itself, being investor-owned, could cover up malfeasance on both Freedom Industries part and theirs as well, to avoid liability for injury and other losses. I’m firmly convinced that when it comes to public goods, of which clean, potable water is the most vital, that public ownership is necessary, because everyone has a direct and unavoidable stake in such a good.

  47. says

    About that chemical spill in Virginia: it is obvious that Freedom Industries knew about the spill long before it was publicly acknowledged.

    When state inspectors arrived at the Freedom Industries tank farm late last Thursday morning, they found a 400-square-foot pool of clear liquid had collected outside a white tank marked as number 396.

    A 4-foot wide stream of the liquid — thicker than water, but not as heavy as syrup — was flowing across the bottom of a containment dike. The flow disappeared right at the joint where the dike’s wall connected to its floor.

    Freedom Industries had set up one cinder block and used one 50-pound bag of some sort of safety absorbent powder to try to block the chemical flow, state Department of Environmental Protection inspectors say.

    “This was a Band-Aid approach,” said DEP air quality inspector Mike Kolb. “It was apparent that this was not an event that had just happened.” […]

    http://www.wvgazette.com/News/201401130118

  48. Pteryxx says

    Tap water photos from HuffPo, some taken after residents were given the OK to use it: link

    CDC warns pregnant women not to drink the water 48 hours after West Virginia declared it safe: link

    Emergency rooms saw an uptick in patients after the ‘do not use’ advisory was lifted. “What we are seeing when we talk to our partners in hospital systems are people with skin and eye irritation, rashes, nausea, upset stomach and diarrhea,” Dr. Rahul Gupta, health officer for the Kanawha-Charleston Health Department, told the Charleston Daily Mail. Those symptoms are consistent with crude MCHM exposure. However, there is no data on crude MCHM’s carcinogenic effects, ability to cause DNA mutations and physical deformities, or its ability to interfere with human development, according to the chemical’s Material Safety Data Sheet.

    well nobody could have seen this coming, of course.

    Freedom Industries files for bankruptcy

    “I think they underestimated the liabilities just a tad,” attorney Aaron Harrah, who firm filed a purported class action lawsuit against Freedom and West Virginia American Water Co., told the Wall Street Journal. According to the Charleston Gazette, the company’s assets and liabilities are each listed as between $1 million and $10 million. Freedom owes $3.66 million to its top 20 unsecured creditors, over $2.4 million in unpaid taxes dating back to at least 2000 and nearly $93,000 in Kanawha County property taxes, about half of which were past due and had become delinquent.

    The announcement comes at the end of what turned out to be a rough two weeks for Pennsylvania coal mining executive Cliff Forrest, who purchased Freedom Industries for $20 million a week before the 7,500 gallon leak was discovered.

    Fracking companies and oil/gas developers sometimes avoid penalties by using temporary fall-guy companies to soak up the liability for environmental damage done by drilling. That way, when the temp company goes under, nobody can seek damages from it.

  49. Pteryxx says

    -_-

    West Virginia Gazette:

    About an hour after its bankruptcy filing, Freedom filed an emergency motion for what’s called “debtor-in-possession,” or DIP, financing, which would allow it to secure up to a $5 million loan to continue to function in some capacity. The loan would, according to the filing, “provide additional liquidity to [Freedom] in order to allow it to continue as a going concern.”

    The lender in “debtor-in-possession” cases generally get first priority when it comes time for the debtor, in this case Freedom, to pay money back.

    “Under the bankruptcy code, when there is DIP financing from a DIP lender, 99 percent of the time they get priority over all the other creditors,” said Bob Simon, a prominent bankruptcy lawyer with the Pittsburgh firm Reed Smith. “You’re putting your money in at risk and the debtor is not going to have a lot of options, so the bankruptcy clerk permits the DIP lender to get priority over all the other lenders.”

    Freedom’s proposed lender is a company called WV Funding LLC. That company does not exist in West Virginia, according to business records on file with the West Virginia secretary of state. Pennsylvania’s secretary of state also has no records online for it.

    The DIP agreement has places to sign for Freedom Industries and for WV Funding “by Mountaineer Funding LLC.”

    Mountaineer Funding was incorporated with the West Virginia secretary of state on Friday. Its one listed member is J. Clifford Forrest, Freedom Industries’ owner.

    The DIP agreement states that the terms “were negotiated by the parties in good faith and at arm’s length.”

  50. Pteryxx says

    More background on how water protections and drinking water supplies have been degraded to the point where one spill by one little company can expose 16% of a state’s population.

    From HuffPo: Who Owns West Virginia’s Water? A Cautionary Tale citing this extensive 2009 NY Times project.

    The topic of waste from coal preparation plants polluting well water in Prenter was the centerpiece of a blockbuster piece published by The New York Times in 2009 that described the systemic failures of states like West Virginia to enforce the federal Clean Water Act.

    [...]

    The article also describes the roots of the latest crisis in West Virginia in appalling detail: how even well-intentioned and ambitious state regulators proved no match for the politically sophisticated and powerful coal industry, how local politicians punish regulators who do their job effectively, and how the coal industry has perfected the art of dodging accountability for the damage it causes. But picking up where the Times left off, the story of how Prenter finally got drinking water restored provides even more useful insight into the roots of last week’s water crisis.

    In late 2009, the state gave final approval [PDF] for a public-private partnership between Boone County and West Virginia American Water Company — the utility that owns the treatment facility and water distribution network shut down since last Thursday — for a multi-million dollar project to run water lines out to Prenter and nearby communities. The project was mostly paid for by a federal Housing and Urban Development grant, with Boone County and West Virginia American Water Company making up the difference. Not a penny was paid by the coal companies that polluted the water in the first place.

    The paper trail of the state’s Public Service Commission filings that document the dramatic expansion of WVAWC’s water network over the past two decades (see map below) reveals similar stories happening again and again, as the company gobbled up one municipal utility after another, as well as individual homes whose wells were polluted by coal mining activities.

    via the blog Coal Tattoo, this statement from the environmental nonprofit Appalachian Voices:

    News reports of Thursday’s spill of a coal-processing chemical into West Virginia’s Elk River—and emergency orders to thousands of people to not drink or use their tap water—are currently focused on the still-unknown potential for direct harm to human health.

    But the widespread disruption caused by the spill raises other important questions, including: How could a relatively small-volume spill in one small river cut off drinking water access to roughly 300,000 people across eight counties—16% of the state’s entire population?

    An increasing number of private wells in southwestern and central West Virginia, where the spill occurred, have been contaminated by decades of coal mining and processing. One result has been an ongoing expansion of municipal water systems to rural communities that would otherwise rely on well water.

    At the same time, shrinking tax revenue and declining investments in public infrastructure have compelled localities to contract with private companies like American Water to provide drinking water services. Driven by profit margins, companies have aggressively consolidated their businesses, leading them to serve ever larger distribution networks from only a handful of treatment plants and drinking water intakes, as is the case with yesterday’s spill.