By Nate Rau | The Tennessean
The East Tennessee chemical company that scored $30 million in economic development incentives from the state in May has a history of fines for air pollution violations.
Eastman Chemical Co. has been fined $340,250 since the beginning of 2009 for a variety of violations, including releasing volatile organic compounds into the air.
Of the top 20 penalties categorized by the federal Environmental Protection Agency as high-priority violations for Tennessee companies in the past five years, eight were assessed to Eastman Chemical.
Pointing out that many of the violations were self-reported and the company's track record of fixing the problems that have been discovered, a spokeswoman for the Tennessee Department of Environment and Conservation said Eastman has been "conscientious and diligent in its compliance efforts at its Kingsport facility."
With more than two dozen environmental regulatory permits, Eastman's chemical manufacturing plant is massive and has millions of compliance points with the federal Clean Air Act.
Eastman manufactures chemicals used in a variety of products. The company, which started its Tennessee operation in 1920, is one of the state's largest with corporate headquarters in Tennessee and 6,750 employees.
A company spokeswoman said Eastman is "dedicated to regulatory compliance, sustainable development and the operation of its facilities in a way that protects the environment as well as the health and safety of our employees and neighbors."
State Rep. Gloria Johnson, D-Knoxville, said she was concerned that the state gave the company the incentive package after the environmental violations. Johnson has been active on environmental issues and was a vocal opponent in the legislature on mountaintop removal for coal mining.
"Rewarding big corporations that don't play by the rules with huge, multimillion-dollar tax handouts is not fair to the businesses and middle-class families who are playing by the rules and getting stuck with the bill," she said.
But state Rep. Tony Shipley, R-Kingsport, said Eastman has a reputation as a strong corporate citizen on environmental and community issues in the region.
"Tennessee Eastman has clearly been an excellent corporate citizen," he said. "There may have been accidental things that happen from time to time and they're fined, but you'd be hard-pressed to find a more environmentally conscious or community-minded company."
9 fines in 5 years
Eastman has been assessed nine fines over the past five years. The most common violation was for failing to abide by the leak detection and repair requirement, which is essentially failing to conduct weekly visual inspections or monthly instrumental monitoring.
Eastman also has been fined for emitting pollutants into the air, including a $125,750 fine in 2010, which was largely for releasing volatile organic compounds.
Pointing out that their research showed the number of enforcement actions by the state for air pollution violations has been on a decline in recent years, Anne Davis, executive director for the Southern Environmental Law center, said the nine violation orders against Eastman were a large number.
"The state's enforcement has been dropping off over the last three years and the state is not issuing a lot of notices of violation and is not issuing a lot of orders, so this looks very significant to me," Davis said of Eastman's recent track record.
TDEC spokeswoman Meg Lockhart said the Kingsport facility is massive and has numerous complex operations. Lockhart also said it is more common now for TDEC to include multiple violations in a single order.
"(Eastman) is a large source and there are many more opportunities for a mistake to occur. Considering the time frame and the orders listed, it would be more accurate to say that Eastman has been quite conscientious and diligent in its compliance efforts at its Kingsport facility," she said. "That is TDEC's assessment."
Eastman spokeswoman Kristin Sturgill said the complex nature of the company's sizable operations meant it had millions of compliance points, parameters and other requirements in its regulatory permits.
"On occasion, our self-assessments identify such deviations which we promptly self-disclose to TDEC and resolve through payment of civil penalties," she said. "Annually, Eastman spends well over $100 million on environmental compliance for our Kingsport, Tennessee, site and corporate environmental programs. Over the past five years, Eastman has spent a total of approximately $673 million in this regard."
Lockhart said it was her understanding that state economic development officials did not approach TDEC before offering the $30 million incentive package to Eastman. The state department of Economic and Community Development conducted its review of Eastman's environmental record by reviewing the company's annual reports filed with the federal Securities and Exchange Commission, spokeswoman Laura Elkins said. However, such reports do not contain the detailed information found in TDEC reports, much of which are searchable through a public online database.
Eastman is planning a $1.6 billion renovation and expansion project at its Kingsport facility, which has a manufacturing operation and serves as the company's corporate headquarters. The project will create an estimated 300 new jobs, according to the company.
The state is contributing a $15 million capital project grant, a $10 million appropriation to the Regional Center for Advanced Manufacturing for job training and a $5 million FastTrack grant.
Some of Eastman's environmental violations
* Releasing into the air more volatile organic compounds than allowed.
* Failing to conduct weekly visual inspections or monthly instrumental monitoring.
Contact Nate Rau at 615-259-8094 or firstname.lastname@example.org. Follow him on Twitter @tnnaterau.