Shasta Lake Battles Over Fibergalss Plant
In a region where unemployment is double the state average and many available jobs are in the low-paying service and retail sectors, a $100 million factory would appear to be a godsend. But in Shasta County, a proposed fiberglass insulation factory has instead become a lightning rod.
The two-year-old battle has split the community, with business and government leaders on one side and a mix of slow-growth advocates, physicians, and small business owners on the other.
In October 1996, representatives of Knauf Fiber Glass, the Economic Development Corp. of Shasta County, and the City of Shasta Lake jointly announced plans for a 150-employee factory on vacant land in the southwest corner of town. Leaders of the German fiberglass company, seeking a West Coast base, hoped to begin making building insulation in Shasta Lake within two years.
Knauf, however, did not foresee the opposition that would fight the project at every turn, said Michael Lynam, director of marketing communications at Knauf's American headquarters in Shelbyville, Indiana. Knauf also has never undergone such a rigorous, time-consuming approval process, he said. Today, Knauf's 95-acre site is graded, but the company still has more than one year of construction remaining and it still needs one more permit before building may begin in earnest. The company remains committed to the project, Lynam said.
The City of Shasta Lake, a five-year-old city of 9,300 in a run-down, semi-rural area north of Redding, attracted Knauf's 500,000-square-foot plant with tax rebates, inexpensive electricity, railroad frontage, and a location halfway between Seattle and Los Angeles. City officials and Shasta County's economic boosters were thrilled with the prospect of a major company bringing manufacturing jobs to town. The area's economy has never recovered from the timber industry's decline and Knauf would be the region's first new, large manufacturer in 30 years.
"It's going to help the whole north state with the jobs it will provide, and not just jobs at the plant," Shasta Lake Mayor Ray Siner said. "There can't be just McDonalds and Burger King jobs for family people. We need manufacturing jobs."
Knauf's financial impact on the City of Shasta Lake and the city's redevelopment agency would be unmistakable. "The assessed value of the project will virtually double the assessed value of the city," City Manager Alan Harvey said. The city agreed to rebate a portion of the property tax revenue to Knauf until the company receives $3.5 million. In addition, the city-owned electric utility will receive a $1.2 million annual "demand charge" from Knauf, though the city has agreed to sell electricity to Knauf at cost. Knauf also would pay about $125,000 in water, sewer, and park impact fees - a large amount for Shasta Lake.
But Laurie Holstein, who lives about three-quarters of a mile from the Knauf site, said decision-makers and average citizens were blinded by the project's ballyhooed economic benefits.
"I'm appalled at the amount of stuff people don't know. They can't see beyond 150 jobs. All they can see is the economic benefits, and even then they only see one side of the ledger," said Holstein, a machine-shop owner. "It's going to cost taxpayers money to get Knauf here and support them while they are here."
Within weeks of Knauf's 1996 announcement, area residents started voicing concerns about the factory's air pollution. They said the plant's discharge of PM10 - dust particles so small they infiltrate human lungs - and various chemicals was inappropriate at Sacramento Valley's northern tip, which mountains surround on three sides. Already the air is often brown in the summertime.
Quickly, Knauf became a polarizing force and both sides claimed science was on their side. A $500,000 EIR by consultants CH2M Hill, and backed by the Shasta County Air Quality Management District, determined that all factory impacts except a few minor ones could be offset. Knauf, for instance, would have to pave about four miles of existing dirt roads to mitigate the 199-foot stack's PM10 emission.
Colleen Leavitt, coordinator of Citizens for Cleaner Air, which formed to fight the factory, complained that Knauf would mitigate only its dust discharge, but not its output of ammonia, phenol, and formaldehyde.
Both the Planning Commission and the City Council in late 1997 gave the fiberglass factory unanimous backing. Council members, all of whom visited a similar Knauf factory in Lanett, Ala., said the plant would be a good neighbor and valued employer.
"They had nothing scientific to go by," Mayor Siner said of factory opponents. Knauf must meet strict pollution standards set by the state and federal regulators, he said.
Project opponents demanded the city reject the project because, they said, it would pollute the air, harm property values, spur other growth, pose a threat of hazardous chemical spills, and blemish the landscape close to the huge Whiskeytown-Shasta-Trinity National Recreation Area. Leavitt and Holstein, a former Citizens for Cleaner Air Leader, said local decision-makers already had their minds made up.
"The last two years have been a real eye-opener for me in terms of the process and in terms of how regulatory bodies seem to turn a deaf ear to what constituents are saying. That has been very disappointing, " Holstein said.
Opponents have continued to press their case. They sued Knauf, the city and other public agencies in U.S. District Court, but Judge Lawrence Karlton dismissed the suit. They tried, but failed, to block Knauf's acquisition of property. They requested the Bureau of Land Management not permit the city to extend power lines to Knauf across one mile of federal property, but BLM rejected the plea. Opponents asked the Army Corps of Engineers not to grant a permit to build on two acres of wetlands and extend a railroad spur over a creek. The corps, which initially appeared skeptical of Knauf's search for sites without wetlands, granted the permit required by Sect. 404 of the Clean Water Act - but only after U.S. Rep. Wally Herger interceded on Knauf's behalf.
Opponents have now pinned their hopes on an appeal of a permit granted by the Shasta County AQMD. Eighteen individuals and groups - including the EPA's Region 9 office in San Francisco - asked the EPA's Environmental Appeals Board to overturn the Prevention of Significant Deterioration permit which Knauf needs before it may build. The board received the appeal in the spring but has yet to decide. In the meantime, the Region 9 office agreed to drop its appeal if Knauf works to cut proposed dust emissions by 30%.
A lawsuit contesting the EIR's validity remains alive in Sacramento County Superior Court. Also, a fledgling county ballot initiative aimed at big polluters has taken shape, but the measure's potential impact on Knauf is unclear.
The opposition has evolved from attempting to block the project altogether to forcing Knauf to minimize its pollution, Leavitt conceded. "A lot of people still wish we could make Knauf go away," Leavitt said, "but they've spent a lot of money, so that's probably not realistic."
Michael Lynam, Knauf Fiber Glass director of marketing communications, (317) 398-4434.
Alan Harvey, Shasta Lake City Manager, (530) 275-7404.
Colleen Leavitt, Citizens for Cleaner Air Coordinator, (530) 275-0246.