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For several weeks now, Senate Majority Leader Harry Reid, D-Nev., has taken to the chamber floor to malign David and Charles Koch, the billionaire brothers who contribute heavily to libertarian causes and bankroll ads critical of Democrats.
On April 2, 2014, Charles Koch fired back in a Wall Street Journal op-ed, arguing that Reid’s comments were disrespectful and a bad sign for democracy. And he defended Koch Industries and their subsidiaries against attacks, including claims that they oppose environmental protections.
"Koch employees have earned well over 700 awards for environmental, health and safety excellence since 2009, many of them from the Environmental Protection Agency and Occupational Safety and Health Administration," Koch wrote. "EPA officials have commended us for our ‘commitment to a cleaner environment’ and called us ‘a model for other companies.’ "
Subsidiaries of Koch Industries include manufacturers like paper maker Georgia Pacific and INVISTA, a textile fiber producer. It also owns companies that deal with excavation of natural resources like Flint Hills Resources and Koch Pipeline. As you can imagine, these are industries that are heavily regulated by federal agencies like the EPA.
So does the EPA think Koch Industries is a model environmentalist? We decided to explore that claim.
Tracking down the quotes
Quotes can often be taken out of context, so we thought it would be useful to understand exactly what the EPA said about Koch Industries and their subsidiaries. A spokesman for Koch Industries was able to provide a pair of press releases with the full quotes.
So did the EPA call Koch Industries a "model for other companies"?
Kinda, but not really. The EPA was complimentary of one specific agreement reached in 2010 with Koch subsidiary Flint Hills Resources after the agency raised concerns about permits for a refinery in Texas.
"The process we have agreed to with Flint Hills Resources is an excellent one, and we look forward to working with the company to complete the work to transition their permits," stated Al Armendariz, Regional Administrator for EPA Region 6. "It is our hope that the FHR process will serve as a model for other companies seeking to transition to federally-approved permits."
As you can see, they were very complimentary of the process in this one instance for this refinery in Texas. But it wasn’t really a blanket statement of the company or Koch Industries.
Let’s move on to whether the EPA has commended Koch Industries for their "commitment to a cleaner environment."
This one has more truth to it, but again, in a limited context. In 2009, Georgia Pacific was named a SmartWay Excellence Award recipient by the EPA. SmartWay is a private-public program run by the EPA that links up manufacturers and retailers with transportation services to "improve fuel efficiency and the environmental performance ... of the goods movement supply chains."
Georgia Pacific was given the award because the company increased its partnership with SmartWay-approved carriers and grew more efficient in their distribution models.
According to a Georgia Pacific press release, here’s the full quote from the EPA official:
"I commend Georgia-Pacific for its leadership in promoting sustainable transportation practices through the SmartWay Transport Partnership," said Margo T. Oge, director of the Office of Transportation and Air Quality, EPA. "These actions demonstrate a commitment to a cleaner environment and more secure energy supply."
An EPA spokeswoman told PolitiFact that the statement was solely "about GP’s transportation practices as a member of SmartWay," and not an assessment of the entire company.
Interestingly, the EPA used identical language in 2000 after reaching a clean air agreement with Koch Petroleum Group and BP Amoco. But the accord was only finalized after Koch was forced to pay a $4.5 million penalty and spend $80 million to improve emissions in three refineries.
"BP Amoco and Koch took the initiative to begin talks with EPA earlier this spring rather than wait for possible EPA enforcement action," the EPA said in a press release. "In return for the company’s cooperation and ambitious commitment to a cleaner environment, EPA has offered a ‘clean slate’ for certain past violations, and greater flexibility and incentives for new technology."
So in this case, "commitment to a cleaner environment" only came after the EPA threatened enforcement actions.
What else has EPA said about Koch Industries?
While those positive quotes about Koch Industries and their subsidies are at least partially accurate, it’s a lopsided picture of the EPA’s dealings with the company in the last two decades.
Since the late 1990s, Koch companies have repeatedly found themselves in the crosshairs of the EPA for various environmental violations. On numerous occasions they were forced to pay hefty fines and settlements and change their practices as a result of EPA and Justice Department action.
The bulk of the more serious violations occurred years ago, but there have been other actions taken recently as well. Here’s a sampling:
In 1999, Koch Industries was found guilty of negligence and malice after two teens in Texas died as a result of an underground pipe leaking butane, according to reports.
In January 2000, Koch Industries was forced to pay a $30 million civil penalty, "the largest civil fine ever imposed on a company under any federal environmental law" and $5 million in cleanup efforts to resolve claims of more than 300 spills from oil pipelines in six states.
"This record civil penalty sends a clear message to those who transport hazardous materials: You cannot endanger public health or the environment," said Attorney General Janet Reno. "We will not let you foul our water and spoil our land by breaking the law."
In March 2000, the Koch Petroleum Group was sentenced to pay $6 million in criminal fines and $2 million in remediation costs — the largest federal fine ever paid in Minnesota at the time — after it was found that one of their refineries polluted waterways and wetlands in Minnesota before 1997. According to a press release, "Koch admitted that it negligently discharged aviation fuel into a wetland and an adjoining waterway. Even though Koch was aware of the problem, it did not develop a comprehensive plan to recover between 200,000-600,000 gallons of released fuel until June 1997."
In September 2000, Koch Industries was indicted for environmental crimes at a refinery the company owned in Texas. They eventually paid a $25 million fine after pleading guilty to one criminal charge.
"Companies that produce dangerous pollutants simply cannot focus on profit and efficiency at the expense of a community's health," said Lois Schiffer, Assistant Attorney General in charge of the environment at the Justice Department. "We will continue to find and prosecute those who would flout our environmental laws."
In February 2013, Koch Nitrogen Company paid a $380,000 fine for failing to create a risk management program for facilities producing and storing ammonia products in Iowa and Kansas.
In March 2014, Flint Hills Resources paid a $350,000 fine for leaky equipment at a Texas chemical plant that allowed hazardous air pollutants into the atmosphere. Though the EPA also credited the company for implementing what it described as "innovative technologies" in the plant to capture pollutants.
In his op-ed, Charles Koch wrote that "EPA officials have commended us for our ‘commitment to a cleaner environment’ and called us ‘a model for other companies.’ " Actually, the EPA was focusing on very limited aspects of Koch Industries and not the company as a whole. Further, Koch Industries has a history with the EPA that was completely glossed over, and it includes multiple violations of rules.
The statement contains an element of truth but ignores critical facts that would give a different impression. We rate it Mostly False.
Wall Street Journal, "Charles Koch: I'm Fighting to Restore a Free Society," April 2, 2014
Email interview with Rob Tappan, spokesman for Koch Industries, April 3, 2014
Koch Industries, "Environment, Health & Safety Facts," accessed April 3, 2014
Environmental Protection Agency, "Flint Hills Resources, LP Agrees to Transition Its Texas Flexible Permits to Federally Approved Clean Air Act Permits - Transition affects facilities in Corpus Christi, Port Arthur and Longview," Oct. 22, 2010
Environmental Protection Agency, "SmartWay Excellence Awards," accessed April 3, 2014
Environmental Protection Agency, "2009 SmartWay Excellence Award Recipients," 2009
Georgia-Pacific, "Georgia-Pacific Named U.S. EPA SmartWay℠ Excellence Award Winner," Oct. 6, 2009
Environmental Protection Agency, "EPA and DOJ announce record clean air agreement with major petroleum refiners," July 25, 2010
The New Yorker, "Covert Operations," Aug. 30, 2010
Environmental Protection Agency, "Koch Industries to pay record fine for oil spills in six states," Jan 13, 2000
Environmental Protection Agency, "Koch Petroleum Group Sentenced for Minnesota Pollution," March 9, 2000
Department of Justice, "Koch Industries Indicted for Environmental Crimes at Refinery," Sept. 28, 2000
Environmental Protection Agency, "Koch Nitrogen Company to Pay $380,000 Civil Penalty for Clean Air Act Violations at Facilities in Iowa and Kansas," Feb. 13, 2013
Environmental Protection Agency, "Flint Hills Resources, Port Arthur Clean Air Act Settlement," March 20, 2014
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