Gulf Plan Leaves Little For Cleanup
A plan to resolve Gulf USA Corp.’s bankruptcy leaves $18 million for cleanup at the Bunker Hill Superfund site in Kellogg.
That’s far shy of the price tag placed on ridding the Silver Valley of lead-contaminated buildings and other public health hazards. Government cost estimates exceed $100 million.
Gulf is the former operator of the Bunker Hill mine and smelter complex. The company’s mining and smelting activities are blamed for polluting much of the Coeur d’Alene River Basin. Bunker Hill knowingly polluted the Silver Valley in the 1970s by belching lead dust from its smelter smokestack without adequate pollution controls.
Gulf went bankrupt in late 1993. Since then, the Environmental Protection Agency has fought for whatever cash it can get from the company to clean up the Silver Valley.
“I don’t think they could have gotten much more money,” said Todd Goodson, a long-time Kellogg resident and member of the town’s City Council. “Because it might have come at the expense of Gulf’s pensioners.”
EPA could win more money from Gulf if the company wins lawsuits against former officers accused of looting the firm. Gulf and several other mining companies already have shelled out millions for cleanup.
In addition to its massive environmental obligations, Gulf owes lifetime medical benefits to more than 2,000 retirees in North Idaho and Spokane. If Gulf’s bankruptcy plan is approved in June, those retirees will be forced to swallow a bitter pill - “some painful cuts” in medical coverage, their attorney said Thursday.
The proposed cut of roughly 18 percent will not mean immediate changes in the retirees’ coverage. Instead, the pool of money available for lifetime benefits will shrink by that much.
A revised plan for Gulf’s bankruptcy reorganization was unveiled this week. In that plan, pensioners fare better than any other creditors in the Gulf bankruptcy.
Other creditors owed millions from Gulf will be paid pennies on the dollar. For example, bondholders owed roughly $80 million will be paid only $3 million; $1 million in cash later this year and another $2 million to be meted out over the next five years. Gulf’s shareholders will receive nothing.
Real estate owned by Gulf and its subsidiary, Pintlar Corp., will be handed over to the EPA and the Coeur d’Alene Tribe. Some of that land is considered crucial to development around the struggling Silver Mountain Ski Resort at Kellogg.
Polluted property will be given to the state of Idaho by the EPA after it has been cleaned up. Exactly who will end up owning the development property around Silver Mountain remains unresolved.
Any payments to creditors hinge on Gulf finding an investor to acquire its only significant asset - a majority interest in a New Zealand real estate concern.
In fact, the entire bankruptcy reorganization is based on a tentative deal with one group of investors - the owners of a stock transfer company based in New York.
xxxx See related story that ran on this date under the headline: Lawyers get a cut