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KEYCODE BAYER 476

Pamela L. Hughes
University of Scranton/Pennsylvania

ENVIRONMENTAL JUSTICE CASE STUDY

THE BAYER GROUP, BAYER MATERIALSCIENCE BAYTOWN, TEXAS LOCATION

The Problem

The Bayer Group was listed as the most toxic company in the U.S. in the March 2010 release of the University of Massachusetts (UMass)’ Political Economy Resource Institute (PERI) “Toxic 100 Air Polluters’ Index”, which is a scorecard listing the 100 top air polluters in the U.S. based on chemical release data from the Environmental Protection Agency (EPA)’s 2006 Toxics Release Inventory (TRI) and the associated human health risk data from the 2006 EPA Risk-Screening Environmental Indicators (RSEI). The TRI measures the weight in pounds of about 600 chemicals released into the air based on reports submitted annually by the facilities as required under the Emergency Planning and Community Right-to-Know Act, which Congress enacted in 1986 in response to the 1984 Union Carbide disaster in Bhopal, India, and the Pollution Protection Act, enacted by Congress in 1990. The EPA Office of Pollution Prevention and Toxics then uses the TRI data to assess the related human health risk based on three factors:

1. How the chemical is spread to the surrounding areas, based on local wind patterns, temperature, smokestack height, and concentration;
2. How dangerous (toxic) the chemical is per pound, based on a toxicity weight assigned to each chemical; and
3. The population of the surrounding areas.

This data is then aggregated into the RSEI report to reflect the companies’ toxicity in terms of its effect on the health of the surrounding areas. PERI uses this report in comparison with the U.S. Census Bureau data to compute Environmental Justice (EJ) ratios reflecting the percentage of minorities and people living below poverty level in the areas affected by the releases.

Bayer’s poor ratings were largely due to incineration transfers of Diaminotoluene, a recognized carcinogen (cancer-causing agent), skin irritant and sensitizer that can cause dermatitis, blindness, asthma, convulsions, and possibly death, at its Baytown, Texas facility (Incineration is the process of burning waste which is then converted into ash, flue gas, and heat, which are then supposed to be cleaned of toxic chemicals before being released into the air).
Bayer also came in fourth in PERI’s 2009 environmental justice study entitled “Justice in the Air: Tracking Toxic Pollution from America's Industries and Companies to Our States, Cities, and Neighborhoods,” (see Figure 2) which is based on the 2005 EPA TRI data and RSEI report. This study uses the EPA data to measure the degree to which toxic emissions contaminate the air in neighborhoods where people of color and low-income families live, and reveals the companies responsible for that contamination. Because Bayer Material Science’s Baytown site, which manufactures polymers and high-performance plastics, is located in the highly populated, racially diverse area east of Houston, the human health risks presented by the toxic emissions from that site earned Bayer a place in the Top Five highest-scoring companies.

Background

Bayer AG was founded in Barmen, Germany, in 1863, and is today headquartered in Leverkusen, North Rhine-Westphalia in Germany. It is a global company with operations in almost every country. Bayer is mostly known for the manufacture of health care products, but is also involved in the manufacture of polymers and chemicals. Bayer MaterialScience is the polymers manufacturing company of Bayer AG, and operates from a site located in the Baytown Industrial Park in Baytown, Texas in the U.S.
In 1998, Bayer announced plans for a 220-million lbs/year toluene diisocyanate (TDI) plant at its Baytown, TX (Toluene diisocyanate is a chemical used in the production of products such as foams and coatings). Bayer had originally intended to build this plant in Taiwan, but had to withdraw that proposal after encountering three years of protests by Taiwanese environmentalist groups and local citizens, who feared that the plant would create additional toxic pollution in an already polluted Taichung harbour, and delay tactics by the Taichung county government, which vowed to deny issuing the necessary construction permits unless the project was approved by a local referendum.
Environmental issues came into focus at the Baytown site in July of 2000, when a contractor at the site notified OSHA of a chemical spill and cleanup. OSHA found that Bayer had neglected to inform exposed employees of the emergency situation, had failed to ensure that employees wore proper safety clothing, and had neglected to monitor exposure of its employees to toxins, among other failings cited. Violations totaled $135,900.
In 2005, Bayer was issued a serious violation (one issued when OSHA believes there is substantial probability that death or serious physical harm resulted from a hazard the employer knew about or should have known about) when a worker died at the site after being sprayed with phenol, a corrosive chemical, from a leaking pipe on which a gasket had not been properly installed. In addition, OSHA cited Bayer for having unclear safety procedures in the case, and the company was fined $5,000.
Besides these safety violations, the site has also been plagued by explosions. In February 2004, local residents were alarmed when a reactor that produces TDA, a chemical used in the production of polyurethane foam, exploded when it was restarted after routine maintenance. Residents claimed they did not hear about the cause until it was announced on Houston television stations a half an hour after the explosion. No injuries were reported, and Bayer claimed that no toxic chemicals were released.
In September 2006, 22 workers were injured at the site when a process vessel containing TDI exploded, resulting in the discharge of carcinogenic chemicals and toxic gas ammonia. The workers were treated for burns and eye, nose and throat irritations, and the plant was closed down for three months. No violations were issued by OSHA in the case. However, the Texas Commission on Environmental Quality determined that the explosion had been caused by the result of "over pressurization" within a process vessel and assessed a fine of over $5,000. The following year, a class action lawsuit was filed against Bayer by workers injured in the explosion, alleging that it was a result of its unsafe practices and that plant officials were having problems with the TDI unit before the explosion but didn't warn contractors. These claims were settled in 2008; no documentation is available on the amount of the settlement.
Although law firms have been quick to offer protection to those who have been injured due to negligence at the Baytown site, little has been done to protect the residents and workers from the toxins regularly present at the site and in the surrounding area, which significantly affects minorities and people living below poverty level who may lack the resources to defend themselves; therefore, it is this issue that is the focus of this report.

Key Actors

The key stakeholders in this issue are:

· The workers at the site and residents, workers and students in the surrounding area, who according to the aforementioned reports are being exposed to high levels of toxins;
· Local public interest groups, insurance agencies, law firms, and government agencies such as OSHA and the EPA that must come up with additional funding to protect the employees and residents against possible injury, illness, and death;
· The Town of Baytown and surrounding jurisdictions, who may suffer from declining population growth due to poor air quality reports, resulting in reduced tax revenues. However, these jurisdictions may suffer equally from reduced profits at Bayer if required to implement emissions reduction technology;
· The media, such as USA Today, which worked in conjunction with the EPA and PERI to publish “The Smokestack Effect,” and scholastic groups such as the University of Massachusetts’ Political Economy Research Institute (PERI) that make reports on the environmental performance of large companies available to the public that can be used in making decisions on relocation, investments, product purchases, etc.; and
· Watchdog groups, such as The Coalition against BAYER Dangers - Germany (CBG), a group who has been monitoring and reporting sustainability issues at Bayer for over 25 years and which created the website www.bayerwatch.com in 2001.
· Local businesses, such as ExxonMobil, that also contribute to toxicity levels in the area and would be pressured to follow the lead of Bayer should they invest considerable time, effort, and capital in green technology.

Demographics

Baytown, TX is the fourth largest city in the Houston metropolitan area, with a population of 70,871 as of July 2009. The median household income in 2009 was $40,559, less than the U.S. median household income of $49,777, and the Baytown per capita income of $17,641 is lower than the U.S. average of $26,530, with 13% of the population living below poverty levels vs. 12.5% nationally (see Table 1). The population in 2009 was made up of 39% white and 61% non-white, much more diverse than the national average of 65.1% white and 34.9% non-white (see Figures 3 and 4).
In addition, 27 schools are located in Baytown. In USA Today’s 2009 Special Report, “The Smokestack Effect – Toxic Air and America’s Schools,” which, in conjunction with the EPA and PERI reports, assessed the toxicity levels at 127,800 schools around the U.S., Baytown schools rated in the 3rd to the 8th percentile (depending on the school’s location), meaning that the toxicity levels at Baytown schools were higher than 92 to 97% of other U.S. schools.
Bayer is not the only company in the top five of the Toxic 100 polluters with facilities in Baytown, however. ExxonMobil, which came in second in the study and ninth in the “Justice in the Air” report, has a refinery, a chemical plant, and an olefins (an alkene or unsaturated chemical compound) plant in Baytown. The air emissions from its Baytown refinery are the highest of all its U.S. facilities, contributing greatly to its poor environmental justice rating and to the high toxicity levels at Baytown schools reflected in the USA Today report.

Strategies

Surprisingly little information is available regarding attempts by stakeholders to alleviate the dangers from toxic emissions inflicted on Baytown residents and workers. According to Ramon Simon, Environmental Specialist and Solid Waste & Remediation Coordinator at Bayer MaterialScience in Baytown, as a result of the TRI reports, the EPA conducted additional studies at that location as required by the Emergency Planning and Community Right-to-Know Act; however, they did not test air samples for airborne chemical contaminants because such testing was limited by their lack of funds. Such testing, Mr. Simon asserts, would have exonerated Bayer by proving that actual air emissions at the site were much lower than those reflected in the Toxic 100 report.
The PERI and USA Today studies made public the information about toxicity levels in that area, but Mr. Simon has indicated that, as discussed in more detail below, Bayer disagrees with the results of the studies, so their response was limited to sending attorneys to Washington DC to work with the EPA on revising the computation of incineration transfers.
Philipp Mimkes of the Coalition Against Bayer Dangers, which wrote in a 2009 letter to North Carolina University that “Bayer has a long history of giving precedence to profits over human rights and a sound environment," has indicated that this organization was not involved in any investigation of the Baytown site; however, they are aware of the study and did communicate directly with the authors of the Toxic 100 Index, Professors Michael Ash and James Boyce.
As mentioned above, Bayer’s strategy has been to defend itself against the results of the Toxic 100 study by claiming that the emissions figures are inaccurate due to the method used to calculate incinerator transfers. In its April 2008 response to the “Toxic 100 Polluters Index” study published by PERI in 2008, in which Bayer came in fourth (again due to incineration transfers at the Baytown site), Bayer claims that, “the PERI study does not measure actual air emissions. The study uses a model that even the EPA acknowledges has limitations and makes multiple assumptions. Essentially, the model converts solid/hazardous waste to air emissions, which, of course, is not the standard industry measure of air emissions. Even the EPA acknowledged several caveats and limitations to the study... If the study measured actual air emissions from our facilities, we would be ranked at the bottom of the list.” According to Mr. Simon, Bayer is in compliance with all federal and state emissions standards, and has been in discussions with PERI and the EPA regarding the formulas used to compute incinerator transfers in the EPA reports and the Toxic 100 Index. Mr. Simon claims that Bayer transfers its waste stream to waste disposal facilities such as Clean Harbors, which is blended with waste from other facilities and incinerated at a more efficient rate than that required by regulation (Mr. Simon indicates that Clean Harbors’ highly efficient incineration process resulted in its being awarded the BP oil spill waste disposal contract; According to Mr. Simon, most facilities incinerate waste at 99% destruction rate efficiency, which is authorized by federal and state governmental bodies; Clean Harbors incinerates waste at 99.9999% efficiency).
However, according to Mr. Simon, the PERI study does not consider Clean Harbors, which incinerates approximately 90% of the Baytown site’s waste stream, to be a chemical producer, and therefore excludes Clean Harbors from its study and includes the waste transferred from Bayer to Clean Harbors in the incinerator transfer emissions of the Bayer facility at the average destruction rate efficiency of 99%. When asked why, if (as PERI claims) the same formula is used to compute incinerator transfers for all companies required to report to the EPA, Bayer continues to be in the top 10 most polluting companies, Mr. Simon explains that the EPA applies a toxicity rate to certain chemicals, and that rate is very high for Diaminotoluene, of which Bayer MaterialScience is the highest producer. Mr. Simons has indicated that these combined factors (the large amount of Diaminotoluene produced at the Baytown site, the high toxicity rate assigned to that waste, and Mr. Simon’s claim that Bayer uses waste disposal facilities which are not included in the study although they incinerate much more efficiently) are the cause of the poor rate of incinerator transfers at the Baytown site.
Professor Michael Ash, co-author of the Toxic 100 Index and the “Justice in the Air” report, concurs with the concept that limitations do exist in the study, and that Bayer needs to work with the EPA to revise the formulas used for transfers intended for offsite incineration. Mr. Ash states, “The US EPA RSEI model is peer reviewed and contains documented assumptions about toxicity, fate and transport, and exposure. Every model has limitations; the RSEI model employs peer-reviewed assumptions and models in conjunction with facility-reported data on releases to provide an estimate of the chronic human health risk associated with facility releases and transfers. US EPA should conduct more direct monitoring of actual air emissions from industrial facilities. Direct monitoring would give a more accurate characterization of the human health risk from toxics released by industry. In the absence of direct monitoring data, the RSEI estimates are among the only available characterizations of the human health risk from toxics released by industry.”

Solutions

Bayer was recently chosen as one of the winners of the 2010 Responsible Care Energy Efficiency award by the American Chemistry Council (ACC) Solutions for its combined heat and power (CHP) facility at the Baytown site, which is expected to reduce NOx and CO2 emissions by 90% and 45%, consecutively (see Figure 5). This, however, does not address the problem of waste transfers, which according to the Toxic 100 Index are the major cause of toxic emissions from this plant.
As of 2008, Bayer had made no progress regarding the incineration transfers reported in the 2010 Toxic 100 study (which, as previously mentioned, utilized TRI data from 2006). According to Professor Ash “The chemical most responsible for Bayer's high rank in the most recent version of the Toxic 100, which refers to the 2006 TRI reporting year and the associated RSEI data, is a transfer for incineration of 4,920,947 pounds of diaminotoluene (mixed isomers). In 2008, the most recent year for which TRI data are available, the Baytown facility transferred 5,652,013 pounds for offsite incineration.”

However, Bayer MaterialScience does have projects in the works to reduce the amount of its waste stream that is transferred offsite. One of the projects mentioned by Mr. Simon, which appears to be an environmental sweet spot for Bayer, involves selling its waste stream to companies which can use that waste in their own manufacturing processes. They currently sell to one vendor, but Mr. Simon has indicated that it is too soon to determine what the impact will be on the incinerator transfers. Although percentage reduction figures are not yet available, Mr. Simon indicates that by selling its waste stream, Bayer will bring in additional revenue and reduce incinerator transfers.
In addition, according to the 2008 TRI report data, Bayer reports the following source reduction activities, most of which appear to be in the form of increased controls at the Baytown site, related to Diaminotoluene:

BAYER MATERIALSCIENCE BAYTOWN, TRI Submission #12 : DIAMINOTOLUENE (MIXED ISOMERS), Source Reduction Methods #1)
Source Red. Activity IMPROVED MAINTENANCE SCHEDULING, RECORDKEEPING, OR PROCEDURES
Source Red. Method 1 INTERNAL POLLUTION PREVENTION OPPORTUNITY AUDIT(S)
Source Red. Method 2 MATERIALS BALANCE AUDITS
Source Red. Method 3 PARTICIPATIVE TEAM MANAGEMENT
Source Red. Activity OTHER CHANGES IN OPERATING PRACTICES
Source Red. Method 1 INTERNAL POLLUTION PREVENTION OPPORTUNITY AUDIT(S)
Source Red. Method 2 MATERIALS BALANCE AUDITS
Source Red. Method 3 EMPLOYEE RECOMMENDATION (UNDER A FORMAL COMPANY PROGRAM)
Source Red. Activity INCREASED PURITY OR RAW MATERIALS
Source Red. Method 1 INTERNAL POLLUTION PREVENTION OPPORTUNITY AUDIT(S)
Source Red. Method 2 MATERIALS BALANCE AUDITS
Source Red. Method 3 EMPLOYEE RECOMMENDATION (UNDER A FORMAL COMPANY PROGRAM)
Source Red. Activity INSTITUTED BETTER CONTROLS ON OPERATING BULK CONTAINERS TO MINIMIZE DISCARDING OF EMPTY CONTAINERS
Source Red. Method 1 INTERNAL POLLUTION PREVENTION OPPORTUNITY AUDIT(S)
Source Red. Method 2 MATERIALS BALANCE AUDITS
Source Red. Method 3 EMPLOYEE RECOMMENDATION (UNDER A FORMAL COMPANY PROGRAM)

Finally, Professor Ash offers the following solution to Bayer: “Green chemistry initiatives, such as the Toxics Use Reduction Institute at the University of Massachusetts Lowell, exist to assist industry in improving processes to reduce exposure to toxics.”

Recommendations

It appears that little has been done by the public, federal, state, and local governments, NGOs, and the like in an effort to persuade Bayer to reduce incinerator transfer emissions at the Baytown Industrial Park site. Communication and cooperation are key factors in promoting change. Stakeholders need to join forces with the EPA to convince the federal government that this is a wide-reaching environmental justice issue in order to obtain the funding necessary to conduct additional testing. Attempts have been made by universities and the media to draw attention to the plight of the Baytown residents, but without funding to allow the EPA to test air emissions at the site and without efforts by the stakeholders to persuade Bayer to reduce the amount of waste produced at the site, little incentive exists for Bayer to alter its current practices. Bayer has taken small, low-cost steps to reduce waste; however, much more needs to be done.
As advised by Professor Ash, assistance in the form of green initiatives is available for improving processes at the Baytown site. There would be few disadvantages to Bayer in investing in green solutions, unless capital was misdirected toward projects that provide little if any return. The advantages to Bayer would be great – cost savings from reduced fines, penalties, and lawsuits, possible cost savings from reducing waste or additional revenues from finding alternate uses for that waste, improved public image, increased employee health and morale, and improved stakeholder relationships, just to name a few. In addition, other Baytown industries would be pressured to follow Bayer’s lead, resulting in an improvement of air quality that would benefit residents, workers, and local government agencies and industries that depend on an influx of residents and tourists.

Key Contacts
Political Economy Research Institute, “The Toxic 100 Air Polluters Index” March 31, 2010 – entire report available online at http://www.peri.umass.edu/toxic100/

Political Economy Research Institute, “Justice in the Air – Tracking Toxic Pollution from America’s Industries and Companies to our States, Cities, and Neighborhoods” April 28, 2009 – available online at http://www.peri.umass.edu/justice/

“USA Today Special Report: The Smokestack Effect – Toxic Air and America’s Schools,” available online at http://content.usatoday.com/news/nation/environment/smokestack/index

Professor Michael Ash at the Political Economy Research Institute, mash@econs.umass.edu

Ramon Simon, Bayer MaterialScience, (281) 383-6149

Philipp Mimkes, Coalition against Bayer Dangers, CBGnetwork(at)aol.com

Works Cited
Personal Communications

Professor Michael Ash, co-author of “Toxic 100 Index” and “Justice in the Air”, email communication on November 29, 2010
Debbie Zeidenberg, Communications Director, Political Economy Research Center, email communications on November 18, 24 and 29, 2010
Ramon Simon, Environmental Specialist, Solid Waste & Remediation Coordinator, BMS, NAFTA Bayer MaterialScience, LLC, telephone interview, November 29, 2010
George Pavlovich, Manager, Product Safety & Regulatory Affairs at Bayer MaterialScience , Greater Pittsburgh Area, email communications, November 18 and 29, 2010
Philipp Mimkes, Coalition against BAYER Dangers, email communications on November 28 and 29, 2010

Internet Research
“The Toxic 100 Air Polluters,” University of Massachusetts’ Political Economy Research Institute by Professors Michael Ash and James K. Boyce , March 2010, retrieved November 28, 2010 at http://www.peri.umass.edu/toxic100/

“Justice in the Air: Tracking Toxic Pollution from America's Industries and Companies to Our States, Cities, and Neighborhoods,” University of Massachusetts’ Political Economy Research Institute by Professors Michael Ash and James K. Boyce, April 28, 2009, retrieved November 28, 2010 at http://www.peri.umass.edu/justice/

“USA Today Special Report: The Smokestack Effect – Toxic Air and America’s Schools,” published in USA Today January 2009, retrieved November 29, 2010 at http://content.usatoday.com/news/nation/environment/smokestack/index

“2008 TRI National Analysis Brochure,” Environmental Protection Agency, released December 2, 2009, retrieved November 29, 2010 at http://www.epa.gov/tri/tridata/tri08/national_analysis/brochure/brochure.htm#q1

“PERI rejoinders to company responses regarding Toxic 100 ranking,” University of Massachusetts’ Political Research Institute, June 2008, retrieved November 30, 2010 at http://www.docstoc.com/docs/1489670/PERI-rejoinders-to-company-responses-regarding-Toxic-100-ranking

“OSHA HAS CITED BAYER CORP. IN BAYTOWN, TEXAS, FOR SAFETY AND HEALTH VIOLATIONS TOTALING $135,900”, Diana Petterson, U.S. Department of Labor Office of Public Affairs, Wed., December 20, 2000, retrieved November 28, 2010 at https://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=NEWS_RELEASES&p_id=444

Bayer AG Company Profile from Crocodyl Collaborative Research on Corporations, retrieved November 29, 2010 at http://www.crocodyl.org/wiki/bayer_ag.

Baytown, TX profile from Onboard Informatics retrieved November 28, 2010 at http://www.city-data.com/city/Baytown-Texas.html

Baytown, TX article from Wikipedia, the free encyclopedia, retrieved November 28, 2010 at http://en.wikipedia.org/wiki/Baytown,_Texas, last updated November 13, 2010

“Population demographics in Baytown TX,”from Movoto LLC, based on data from the Census and the FBI Crime Database, retrieved November 28, 2010 at http://www.movoto.com/neighborhood/tx/baytown/77521.htm

“Income, Poverty, and Health Insurance Coverage in the United States: 2009”, US Census Bureau by Carmen DeNavas-Walt, Bernadette D. Proctor and Jessica C. Smith, released September 2010, retrieved November 28, 2010 at http://www.census.gov/prod/2010pubs/p60-238.pdf

“Baytown Industrial Park 830 MW Combined-Cycle Application” Project Profile, prepared by Kathey Ferland, Center for Energy & Environmental Resources at The University of Texas at Austin for the Gulf Coast CHP Application Center, Houston Advanced Research Center, retrieved November 28, 2010 at http://files.harc.edu/Sites/GulfCoastCHP/CaseStudies/ChambersCountyTXBayer.pdf

“US experts probe Bayer blast at Texas plant; 22 workers with minor injuries,” September 28, 2006, AFX News; “Bayer Hit with Lawsuit after Explosion,” Oct. 2, 2006, Associated Press; retrieved November 28, 2010 from the Coalition against Bayer Dangers website at http://www.cbgnetwork.com/1633.html

“Explosion at Bayer plant in Baytown injures 20,” by CINDY HORSWELL, Houston Chronicle Sept. 26, 2006, retrieved November 28, 2010 at http://www.chron.com/disp/story.mpl/metropolitan/4215561.html

“Bayer Response to Toxic 100 Rating,” April 30, 2008, retrieved November 28, 2010 at www.business-humanrights.org/Documents/Bayer-response-PERI-Toxic-100-30-Apr-2008.doc

“Bayer Plant in Taiwan Cancelled”, Mark Munsterhjelm, Taipei, 19 March 1998, retrieved November 29, 2010 at http://www.hartford-hwp.com/archives/55/580.html

“Taiwan revives controversial Bayer project,” Kevin Chen, 07 March 1998, retrieved November 29, 2010 at http://www.expressindia.com/fe/daily/19980307/06655694.html

“Group urges NCSU to end deal with Bayer,” Jan 28, 2009, The News & Observer / McClatchy-Tribune, retrieved November 30, 2010 at http://www.cbgnetwork.org/2794.html