Exide: How Anthony Rendon Sold Out California and Children’s Health to Protect a Billion-Dollar Corporation

The betrayal by Anthony Rendon of his constituents could not be more obvious. State regulators had been apportioned hundreds of millions of dollars to pursue litigation against Exide, a billion-dollar company that had been knowingly releasing lead and arsenic into residential neighborhoods for decades. Anthony Rendon, along with Christina Garcia and a number of other complicit Democrats, instead passed a new law ending the possibility of litigation against Exide. Instead, Rendon and Garcia passed a statewide car battery tax — essentially a car tax on every single driver in California. What’s worse, Rendon’s car tax raised less than $200 million, when the legislature was fully aware that the cost of cleanup would exceed $500 million.

Exide operated a lead-acid battery recycling plant in the city of Vernon. The battery plant sits just across the L.A. River from the City of Maywood in Rendon’s district. Exide ultimately released a number of toxins that spread south through Assembly District 63, including in the city of Bell.

The battery recycling plant had been in operation since 1922. As early as 1987, California’s Department of Toxic Substances Control (“DTSC”) issued numerous citations and letters regarding hazardous waste violations. In a lawsuit brought against Exide Technologies, the company’s shareholders alleged that Exide had submitted a 2011 health assessment reports to the state’s Air Quality Management District (“AQMD”) showing a “shockingly high” level of arsenic emissions at the facility. Arsenic levels were found to be 96% higher than in 2008; Exide was granted permission to investigate and rested at the plant, with a 2012 test showing results of the “same order of magnitude.” The facility was ultimately allowed to operate without a full permit for 33 years, “even as inspectors documented more than 100 violations, including lead and acid leaks, an overflowing pond of toxic sludge, enormous cracks in the floor and hazardous levels of lead in the soil outside.”

Community-based activist groups played a key role in bringing stronger regulatory attention to the Exide situation. In January 2014, a local group — the East Yard Communities for Environmental Justice — made a push in Sacramento for new legislation to revoke permits for or ultimately shut down the Exide facility. SB 812, authored by Senator Kevin de Leon, would have set a three-year deadline for “issuing permits, requiring greater public disclosure, and establishing a public oversight committee,” was passed by the legislature by vetoed by Governor Jerry Brown. SB 712, authored by Senator Ricardo Lara, “proposed that all facilities operating under a temporary permit obtain a permanent one by July 2015 or have their permit revoked,” was signed into law.

In March of 2015 — two months before SB 712’s July deadline — Exide entered into an agreement with the U.S. Attorney’s office to permanently shut down the plant. The agreement “allowed Exide and its employees to avoid prosecution for years of environmental crimes, including illegal storage, disposal and shipment of hazardous waste, while agreeing to pay $50 million to demolish and clean the plant and surrounding communities, including $9 million set aside for removing lead from homes.” The 2015 agreement followed a 2014 order by the DTSC that required Exide to set aside “sufficient funds to close its Vernon facility . . . and ordering Exide to take measures immediately to address contamination in the surrounding community.”

The closure of Exide did not mark the end of the struggle against pollution from the battery plant, which continues to this day. When the U.S. Attorney’s deal was announced, the director of East Yard Communities, Mark Lopez, indicated that the fight was ongoing, stating: “Just because Exide is shutting down, doesn’t mean that the cleanup is guaranteed . . . we still have to pressure DTSC to follow through with comprehensive testing so we understand the full extent of the issue, and then full cleanup.” Other groups expressed immediate skepticism at the ability of the DTSC — the same agency that had previously failed to stop the Exide pollution for years — to properly clean up the massive amount of lead pollution in residential neighborhoods that is the legacy of the Exide plant.

A close examination of the response by California regulators and the state legislature reveals serious deficiencies, even after the closure. While the DTSC enforcement order called for a $38.6 million set-aside for plant closure costs, Exide was only required to provide $9 million for a trust fund to pay for residential clean-up. The underfunding of the Exide clean-up quickly spurred more demands for state action to address the problems of toxic pollution that were left largely unaddressed by the prior DTSC and U.S. Attorney actions.

Enter Rendon and the California Legislature

After the closure of Exide, the issue of how to clean up with the massive amounts of lead that the battery recycler had spewed into neighboring resident communities went to the state legislature. Analysis by state regulators revealed that the total cost of the cleanup would likely exceed half a billion dollars.

Following the announcement of the Exide closure, Governor Jerry Brown announced his intent to seek an additional $176.6 million in state funding to pay for the clean-up. The additional funding was sought after a prior allotment of $8.5 million was heavily criticized by both the public and other lawmakers.

The path the state took to obtaining this additional funding was both inadequate from a public health perspective and unduly deferential to industry from the view of social justice. The $176 million in clean-up funds was appropriated by the state in two phases in 2016. In its first step, the legislature passed two bills — SB 93 and AB 118 — that were signed into law by Governor Brown on April 20, 2016. SB 93 approved a loan of $176 million to the DTSC from the state’s general fund. AB 118 approved the us of the $176 million for lead contamination clean-up, while specifically authorizing the DTSC “to pursue all available remedies against all responsible parties.”

The April legislation was followed by the passage of AB 2153, signed into law by Governor Brown on September 26, 2016. AB 2153 created a consumer battery recycling fee in order to pay off the loans previously approved to the DSTC by the passage of SB 93. Senate Rules Committee analysis of AB 2153 quite clearly reveals the intent of the California legislature to abandon the path of cost recovery from Exide and other responsible parties, to pass the costs of clean-up on to consumers and taxpayers statewide, and to knowingly approve of a clean-up program that was woefully underfunded.

First, the Rules Committee provided a summary of the environmental catastrophe created surrounding the Exide facility. The Committee donated that “[d]uring its decades of operation, the facility polluted the soil beneath it with high levels of lead, arsenic, cadmium, and other toxic metals. It has also contaminated groundwater, released battery acid onto roads and contaminated homes and yards in surrounding communities with lead emissions.” The Senate analysis further found, based on DTSC estimates, “the total cleanup [costs] in and around the Exide facility is expected to top $500 million.” The analysis also noted that Exide was not the only industrial operation potentially responsible for environmental damage, as there was a continuing investigating into Quemetco, Inc., another lead-acid battery recycler operating in the nearby City of Industry.

Yet in a letter submitted to the state assembly journal, the author of the bill stated: “It is my intent in authoring this bill, and the Legislature’s intent in approving this legislation rather than further delaying funding for clean up by choosing the costly path of litigation with an uncertain outcome against battery manufacturers or other parties who are not owners or operators of the battery recycling facilities, that the State choose instead the collaborative approach contained in this bill.” Rather than continue an aggressive enforcement and cost recovery approach against the responsible parties, AB 2153 imposed a “California battery fee” of $1 per person “for each replacement lead-acid battery purchased.” The Battery Council International, a trade group representing lead acid battery manufacturers, immediately lauded the passage of AB 2153, releasing a statement that the group was “proud to have been able to collaborate on the significant legislative effort which culminated in the passage of AB 2153.”

One analysis of the Exide situation concluded that the “closure of Exide in early 2015 cannot be seen as a victory, given the toxicity left in its wake . . . at the end of the day, the local residents are still living in contaminated neighborhoods, although there are no longer continued emissions.”

The Situation Today

Activists in the cities of Bell and Maywood continue to mobilize to fight for a more robust cleanup effort. Yet the betrayal by Anthony Rendon of his consituents could not be more obvious. State regulators had been apportioned hundreds of millions of dollars to pursue litigation against Exide, a billion-dollar company that had been knowingly releasing lead and arsenic into residential neighborhoods for decades. Anthony Rendon, along with Christina Garcia and a number of other complicit Democrats, instead passed a new law ending the possibility of litigation against Exide. Instead, Rendon and Garcia passed a statewide car battery tax — essentially a car tax on every single driver in California. What’s worse, Rendon’s car tax raised less than $200 million, when the legislature was fully aware that the cost of cleanup would exceed $500 million.

So it has to be asked — does Rendon care more about a billion dollar corporation, or the health and safety of vulnerable children in his district? I think we know the answer.

Works Cited

News & Press Releases

BCI Headquarters, “Statement of Battery Council International Upon Passage of AB 2153 (C. Garcia),” Sept. 6, 2016, available at http://batterycouncil.org/blogpost/1190989/256321/Statement-of-Battery-Council-International-Upon-Passage-of-AB-2153-C-Garcia

Tony Barboza, “State’s Exide cleanup pace stirs ire among residents in southeast L.A. County,” August 21, 2015, Los Angeles Times, available at http://www.latimes.com/science/la-me-0821-exide-20150821-story.html.

Tony Barboza, “How a battery recycler contaminated L.A.-area homes for decades,” Los Angeles Times, Dec. 21, 2015.

Tony Barboza, “Gov. Jerry Brown wants state to put $176 million towards Exide cleanup,” Feb. 17, 2016, Los Angeles Times, http://www.latimes.com/local/lanow/la-me-exide-cleanup-20160217-story.html.

Tony Barboza and Ben Poston, “Criticized over a delay on Exide, regulators move to clean homes with the worst lead contamination,” Jan. 12, 2017, Los Angeles Times.

Natural Resources Defense Council, “Press Release: Governor Pledges $176.6 million for Exide Clean-up,”available at https://www.nrdc.org/media/2016/160217.

Molly Peterson and Adrian Flordio, “Vernon-based Exide Technologies to shut down permanently under deal with US Attorney,” March 12, 2015, Southern California Public Radio, available at http://www.scpr.org/news/2015/03/12/50323/vernon-based-exide-technologies-to-shut-down-perma/.

Laura Pulido, Ellen Kohl, and Nicole-Marie Cotton, “State Regulation and Environmental Justice: The Need for Strategy Reassessment,” Capitalism Nature Socialism (2016) 27:2

Telemundo 52, “Exigen acelerar limpieze de viviendas cercanas a Exide,” Sept. 19, 2017, https://www.telemundo52.com/noticias/local/Exigen-acelerar-limpieza-de-viviendas-cercanas-a-Exide-445725833.html.

Legal & Regulatory Documents:

Department of Toxic Substances Control, “News Release: DTSC Announces Enforcement Order,” Nov. 6, 2014, Department of Toxic Substances Control, available at http://www.dtsc.ca.gov/PressRoom/upload/DTSC-Announces-Enforcement-Order.pdf.

Loritz v. Exide Technologies (2014) 98 Fed. Sec. L. Rep. 142, 2014 WL 4058752.

U.S. Attorney’s Office, Non-Prosectuion Agreement between Exide Technologies and the United States Attorney’s Office for the Central District of California, March 11, 2015, available at http://documents.latimes.com/exide-non-prosecution-agreement/ (accessed Jan. 24, 2018).

Legislative & Executive Materials

AB 2153, Legislative Digest, available at https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201520160AB2153.

Senate Rules Committee, Office of Senate Floor Analysis, “The Lead-Battery Recycling Act of 2016,” Third Reading, available at http://www.legtrack.com/cache/292942.doc.