San Luis Obispo facing millions in environment fines

October 18, 2012

Dan De Vaul


San Luis Obispo is facing millions of dollars in fines by state and federal agencies investigating the illegal dumping of toxic wastes by city employees and failure to follow environmental regulations. If the fines are levied, city taxpayers could find themselves paying for the city’s conduct.

Regulators, residents and some city staffers have accused the city of illegally dumping toxic waste on private and city properties, not complying with permit requirements that are designed to protect community water sources, failing to properly report hazardous waste disposals and conspiring to keep regulators and the public in the dark.

As a result, the city faces hefty fines from two different investigations in which federal and state regulators are looking into environmental mismanagement and illegal dumping. In addition, some concerned city employees said they reported further environmental mismanagement issues to regulators during their interviews.

The investigation into the failure to follow environmental regulations was by a contractor for the U.S. Environmental Protection Agency and staff from the Central Coast Regional Water Quality Control Board. They were checking to see if San Luis Obispo was complying with portions of its storm water management plan permit dealing with construction water runoff and pollution protection.

City staffers told the city council they had passed the audit with high marks. But, an investigation report says regulators found program deficiencies and potential violations that will likely result in a formal notice of violation and fines.

The potential violations are the result of the city’s failure to control refuse such as chemicals, litter and sanitary waste at a construction site. In addition, the city has not been keeping required inspection schedules and checklists in place to protect public health and the environment, the report says.

In the city’s annual storm water report, Storm Water Manager Freddy Otte signed under penalty of perjury that the city has developed a comprehensive program with inspection checklist and training programs. However, during the audit, management admitted the program was still in the development phase.

In their summary, the investigators slammed the city for having no real controls in place to protect against water pollution at one site. Investigators reported inadequate performances by employees after interviewing  Otte, Utilities Director David Hix, Utilities Program Manager Aaron Floyd, Chief Building Official Tim Girvin, Hazardous Materials Coordinator Kerry Boyle and City Community Development Director Derek Johnson.

“City had the ability to not hire ‘bad players,’ ” investigators say in their summary of a public project review.

In addition to the compliance problems, investigators have been told about dumping and pollution at Dan De Vaul’s 72-acre ranch on the outskirts of San Luis Obispo. The land includes acres of wetlands and flood plains that help replenish the Los Osos aquifer.

That Los Osos aquifer is contaminated with nitrates. More than a decade ago, De Vaul, seeking income and more workable acreage, agreed to allow the dumping of what was first described as fill dirt on his property, he said.

City management and several local developers paid trucking companies between $200 and $400 a load to remove the refuse. The truckers would then pay De Vaul to empty truckloads of fill dirt, asphalt grindings and grit from the sewer plant on his property, De Vaul and several city employees said.

Grit is the refuse that fails to break down during sewage treatment. Its makeup varies though it generally has high levels of nitrates. Asphalt grindings, produced during the removal of old roadways, are contaminated with numerous toxins known to negatively affect public health and the environment including hydrocarbons and asbestos.

“I know they brought in asphalt grindings, I did not know about the shit from the sewer plant,” De Vaul said. “They brought in dirt once from Abercrombie & Fitch they said might be hazardous, but then they said it cleared.”

De Vaul said his income from the disposals was cut off abruptly about seven years ago. A city employee said staff was warned the city could be fined if it was discovered they were not following federal and state laws regarding the disposal of waste.

“Then they started taking it to a hazmat place near Kettleman City,” De Vaul said.

Even so, city staff failed to report the dumping or to attempt a cleanup. It would not be the last time city employees allegedly conspired to conceal the illegal dumping of hazardous waste.

Solvents, varnish and creosote seeped from cans to a strip of wood separating the asphalt from the soil. Picture taken one week after discharge.

In Jan. 2011, waste water collections Supervisor Bud Nance ordered staffers to dump between 50 and 60 gallons of hazardous waste in the city’s corporation yard on Prado Road. After it was discovered, city employees sent dozens of emails that outlined their plans not to properly clean up or report the illicit dumping. Many of the emails were reported in earlier CalCoastNews stories.

At the time, SLO Fire Department Hazardous Materials Coordinator Kerry Boyle said that the city was not required to report the dumping.

But, after criminal investigators from the California Department of Toxic Substances Control (DTSC) arrived in late 2011, Boyle reversed his position and slapped the city with a notice of violation for breaking 13 laws.

The investigations by the DTSC and the EPA are continuing. The city’s failure to report the illegal dumping at the corporate yard could result in fines totaling more than $7 million and indictments of several of the city’s mid-level managers.

Another issue facing the city deals with reporting and record-keeping for its hazardous waste disposal. The city of San Luis Obispo, along with other agencies, is supposed to send its hazardous waste manifests to the DTSC, which works to protect California’s people and the environment from the harmful effects of toxic substances through enforcement, pollution prevention and regulations. The regulations apply to the disposal of toxic substances.

A public records request from CalCoastNews for several years of the city’s hazardous waste manifests resulted in the receipt of numerous manifests that had never been sent to the DTSC as required by law.

Many of the manifests that were provided by the city were incompletely filled out, others have dates showing that the city was conducting its business on Sundays or have no dates of the disposals and still others bear signatures of employees who contend someone forged their name.

In its response to the records request, the city included a handful of waivers that say it is a Conditionally Exempt Small Quantity Generator (CBSQG) which generates no more than 100 kilograms (27 gallons or 220 pounds) of hazardous waste per month. The waivers say entities that generate small quantities of hazardous waste are not required to use DTSC registered transporters or submit manifests.

But, Charlotte Fadipe, a spokesperson for the DTSC, said that federal laws permitting small generator status are not recognized in California. There are some state allowances for small generators, she said.

“California rules do not recognize CESQG status, nor does the shipping description on a manifest differ for generators of less than 100 kg per month,” Fadipe said in an email.

City Attorney Christine Dietrick and Councilman John Ashbaugh said they are confident that the city has followed environmental requirements.

“The City is in compliance with applicable law on disposal of hazardous wastes, and if there are occasional disposal issues or practices that require council attention, we will address them promptly,” Ashbaugh said in an email several months ago.


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This story ought to be showcased on the program Greed. Or sixty minutes.

and WHO gets to pay the fines in the end?

No wonder the county was so hot to stomp on Dan Duvall. They were trying to cover their own ass, mostly on Dan’s back. Not saying he had his faults with his property but this is so out of line. Shame on SLO County for that, karma is not your friend and she is comin up your back side right now. JMO

How about fining the employees for the crimes committed instead of the innocent taxpayers. Government employees who fail at their jobs should forfeit some of their pension as a fine!

Anyone spending effort speculating on what Dan Duvaul can or cannot do, or will or will not do, at any one time, in any particular circumstance, is on a fool’s errand.

He will prove you wrong every time.

I would say unbelievable, but the pictures say it all. Now if we wonder why council does nothing about the issues that Calcoast News brings to light? Well, look no further a city councilman misusing city resources for a political campaign and accepting campaign contributions larger than what is allowed by local ordinance. Wake up SLO!

More gov fining gov! I think jail time would better serve the taxpayer because fines are all about the re-distribution of tax dollars. The frenzy is on and the tax register is empty for the next 50 years.

and incarceration is free?

No, but these soft-handed coddled folks might just be incentivized to not commit fraud, waste and abuse if they knew it was the big-house for them when caught.

Why not fine them 173 million dollars and give it to the people in Los Osos.

I believe the people of Los Osos will have an opportunity here to “rethink and redo” the plans for their plant. There has been all this talk about the nitrates out in that area in the ground water and how they got there. But it looks like the nitrates have come at least in part from the De Vaul property toxic waste dumping. That will open the door for the community to sue to stop the new plant until they sort out the nitrate issue. And if it is found that the nitrates came from the dumping of toxic waste on Los Osos Valley Rd, can you imagine the law suit against the City of SLO that your community will develop. You may get a free plant built.