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Is the Exxon payout too small?

The Brooklyn Paper

Less than a week after the state reached a historic $25-million settlement with ExxonMobil, forcing the company to finish cleaning up the Greenpoint oil spill, residents are questioning whether those funds will go far enough to repair six decades of pollution.

“It’s small,” said Greenpoint resident Mike Hofmann. “They made $11.5 billion in one quarter a few years ago and we get $25 million? That’s crazy.”

The largest environmental settlement in state history, announced by Attorney General Andrew Cuomo on Nov. 18, abruptly ended a six-year legal battle between environmental groups, public officials and ExxonMobil over responsibility for cleaning up an estimated 17 million gallons of oil that leached into 55 acres of Greenpoint soil and groundwater for half a century.

State suits against other oil companies situated along Newtown Creek, such as Phelps Dodge, National Grid, BP, and Chevron-Texaco, are pending.

Other Greenpoint residents want the company to go further and not forget about the health and welfare of residents who have lived above the oil plume for decades.

“[The state] hasn’t been able to make a direct link to health issues, oil spill and pollution, strange as it may seem,” said Rich Mazur, an area developer. “Exxon is liable to clean up oil spill and the soil but not take care of the people who have gotten sick because of it.”

The size of the settlement also troubled some environmentalists, who pointed out that government lawyers preparing the case against BP for the Gulf Oil spill are talking about fines between $4.5 and $17.6 billion. If a similar penalty was assessed against ExxonMobil for the Greenpoint spill, the range would be $445 million to $1.7 billion, depending on the level of negligence determined in court.

“How did Exxon get away with a $25-million penalty?” a group called Neighborhood Roots said in a statement. “When state lawyers were negotiating a settlement before [Cuomo] took the case away, the settlement was closer to $200 million. The elected officials should be ashamed of themselves for agreeing to such a miniscule settlement.”

Councilman Steve Levin (D–Greenpoint) disagreed, saying that ExxonMobil would be held to the “highest appropriate liability for its negligence,” adding, “It is my hope that the compensation from this settlement will be far reaching enough to improve the lives of everyone who lives, works, and visits Greenpoint.”

Skepticism aside, many environmental advocates praised the deal resolving the lawsuit, calling it the best outcome for the Greenpoint community because a lengthy trial could have stalled in court indefinitely — even if the result would have been a slightly higher financial settlement.

Indeed, in the case of the Exxon Valdez, which dumped 10 billion gallons of oil into pristine Alaskan waters in 1989, an initial $5-billion punishment against the oil company evaporated into a $500-million judgement on appeal — and wasn’t finalized until 2009.

“Our goal from the beginning of bringing our lawsuit was to compel Exxon to clean up the site and compensate the community for the damage,” said Philip Musegaas of Riverkeeper, an environmental watchdog that first filed suit in 2004. “We’ve fought very hard for the settlement we’ve got and we’re happy with the settlement we have.”

A spokeswoman for ExxonMobil declined to address how the settlement was reached or how much the removal of pollution will cost the company, which has not been disclosed publicly. She did say that the agreement goes beyond previous ones which required an initial removal of oil obligating the company to address all “soil, groundwater, soil vapor and air concerns,” with additional oversight from the state.

“Complex remediation projects such as Greenpoint, where petroleum products are underground and not easily accessed — take time to complete, said the spokeswoman, Kristin Hellmer. “ExxonMobil is committed to remain in Greenpoint until the remediation effort is done — and done right.”

Exxon’s settlement only applies to the removal of oil from underground — not to costs incurred from the federal government’s Superfund designation for Newtown Creek or any health-related consequences that pollution has caused over generations. Those lawsuits are still in court and the state retains its right to sue on matters regarding the creek in the future.

The settlement will not only require the company to achieve several benchmarks for removing pollutants and report on its progress under the court’s supervision but also pay $19.5 million to fund environmental projects that will benefit the Greenpoint community — although the company did not acknowledge culpability for the contamination.

The environmental benefits package of $19.5 million is roughly double the total amount that Greenpoint received from the city’s 2008 settlement with the state for violating pollution laws and failing to upgrade its $4-billion sewage plant on a timely schedule.

Updated 3:57 am, May 21, 2014: Includes new context.
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Reader Feedback

ricardoeddy from california says:

You know what You guys should stop complaining because, one the health care we have now isnt as good as it was supposed to be. also the law has just been signed so give it some time. so if u want to say u have the right to choose tell that to ur congress men or state official. If you do not have insurance and need one You can find full medical coverage at the lowest price check http://ow.ly/3akSX .If you have health insurance and do not care about cost just be happy it and trust me you are not going to loose anything!
Nov. 24, 2010, 12:46 am
teresa toro from greenpoint says:
As a co-plaintiff in the Riverkeeper lawsuit against Exxon Mobil, I am pleased with the settlement.

It's not useful to think about Exxon's billions of dollars in resources, however true that may be. We are a small, poor community and could never, ever have afforded a fraction of the expert legal representation we received for free through Riverkeeper and the Pace Environmental Litigation Clinic. What's more, Exxon has the resources to have outlasted us for decades, even the natural lifetimes of people who have been personally affected by the spill. Prolonging our lawsuit to see if we could have gotten more money, when there are significant environmental and health impacts we can see today, seems unreasonable to me, not to mention an unfair drain on our legal team, which worked very hard on this case.

It's also unreasonable because we sued Exxon Mobil under the Clean Water Act, meaning our lawsuit was solely focused on the spill and its cleanup, regardless of the cost to Exxon Mobil. Getting a $25M penalty payment to the community on top of that was a remarkable bonus, since under the Clean Water Act we couldn't sue for damages or payment of any kind.

Apart from the $25M, the accountability, deadline and transparency loopholes missing from the original court order have been closed; there is a careful system of checks and balances with a real oversight role for Riverkeeper and the community. That, plus the $25M we receive now (not the remote possibility of more money, later on, for people who could be long gone by the time that mythical check might be cut), represent a good settlement to me.

I am deeply grateful to Riverkeeper and Pace for their years of doggedly fighting one of the most powerful global corporations on our behalf, and for Riverkeeper's ongoing commitment to make sure Exxon does a thorough and timely cleanup.
Nov. 24, 2010, 9:56 am
ms nomer from greenpoint says:
So looks like big thanks are in order to Riverkeeper for a job well done. We want that cleanup and looks like all these years of the lawsuit Exxon has continued to drag its wealthy corporate feet. Enough is enough. Clean up this mess!

And a halfhearted thanks to Attorney General/Governer Elect Cuomo, who maybe could have held out for a little more cash for us. A little too eager for a 'win' to carry him into his new job?
Nov. 24, 2010, 11:06 am
Innocent bystander from GP/WB says:
Exxon Valdez- 10 Million gallons equaled a $500 million dollar settlement as listed in this article.

Greenpoint spill twice that size equals $25 million dollar settlement?

I think it's fair to say that Greenpoint got screwed by AG Cuomo and Riverkeepers. Anyone who is coming to the defense of this settlement is misguided, insane or corrupt.

I wonder if Exxon was a major contributer to the Cuomo for Governor campaign fund?
Nov. 25, 2010, 12:07 am
LemonMeister from A KB Home Sucks says:
Cuomo is too busy flexing his oil derrick in the mirror.

Imagine give this guy an award (SMA) so he won't investigate your magazine look at those flashy ads bt eXXon. Bet you didn't know eXXon never paid those fines in that Alaska Valdez oil spill either? What makes NY think the 25mil is going to get paid? Just went to people dot com and used their search tool. no mention of Andrew Cuomo voted as sexiest man alive? Running with the press release, Didn't do your homework? Lazy webmaster at the People website? About Sandra Lee and her ex husband, Bruce Karatz crimes will be felt by my grandchildren and great grandchildren not by his grandchildren. As the homes he built fall into the ground from shoddy, deceptive building practices accepted as the norm by United States politicians. Bruce has lined his pockets and his close circle of friends. Even Michael Milken the junk bond king did 4 years came down with cancer and paid $500 Million for his crimes. Stealing is not a crime to while collar criminals. Getting caught is the real crime. http://www.akbhomesucks.com Cuomo's girlfriend Sandra Lee may have been paid off in her divorce settlement with Bruce Karatz (the Felon's) ill gotten gains? Andy can you look into this?
Nov. 27, 2010, 3:20 am

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