DTSC Admits It Failed to Collect Millions Owed to CA

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Toxic regulator reveals it has not recouped $185 million in public funds from polluters

The state agency in charge of regulating toxic polluters admitted Thursday that it failed to collect $185 million the state spent cleaning up contaminated sites such as junkyards, small businesses and property owned by large companies including Chevron. That means California taxpayers have been on the hook for a quarter of a century.

The Investigative Unit first exposed problems at the Department of Toxic Substances Control in February when whistleblowers revealed weak enforcement of regulated companies and mismanagement by top leaders.

Now the DTSC is admitting that for the past 26 years the department has not had a system in place to track its bills. The department spokesman said Thursday that the DTSC is unlikely to recover much of that money.

"I'll be honest," said DTSC spokesman Jim Marxen, "it looks like a lot of those companies are bankrupt and have been for some time, so the likelihood of getting the full $184 million is not high."

According to the DTSC, the department has not billed for $102.7 million because it has not evaluated if these costs are recoverable from responsible parties. The department said $37.3 million is tied up in litigation, bankruptcy or other legal considerations and that it has sent invoices for $45 million of costs but has yet to receive payment.

Marxen said the project with the largest outstanding bill involved the cleanup of a chemical company in Contra Costa County, which cost more than $9 million. The department reports that the company, Chemical & Pigment Co. went out of business 15 years ago.

"It's outrageous that companies like Chevron, chemical companies, and junkyards didn't get billed for cleanups and regulators stuck Californians with the tab," said Consumer Watchdog advocate Liza Tucker, who authored a critical report of the DTSC in February. "These are funds that belong to us, the California taxpayers that the DTSC has failed to collect."

According to a letter posted on the DTSC website, the problem was identified in 1992 and was raised multiple times in the years since then but past DTSC administrations did little to address the problem. The letter also states that current director Debbie Raphael learned of the uncollected costs in a December 2011 letter and then dispatched a team to reduce unbilled costs and increase the department's collection rate.

Tucker is calling for a state audit of the DTSC and calls the problem of uncollected funds just "the tip of the iceberg."

Click here to see a full list of the unbilled and invoiced companies.

If you have a story for the Investigative Unit email [email protected] or call 888-996-TIPS.

You can also tweet @vickydnguyen or find Vicky Nguyen on Facebook.

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