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AK refusing to pay any fines

By Thomas Gnau, Journal Business Writer, E-mail:

As long as AK Steel Corp. refuses to “pay any penalty,” settlement of a state and federal lawsuit against the company “will remain impossible,” Ohio Environmental Protection Agency Director Christopher Jones wrote in a letter dated Friday.

Ohio and federal governments are suing Middletown-based AK in U.S. District Court in Cincinnati. The lawsuit is now in a discovery phase and heading for a trial late this year or early next.

AK is balking at the idea of punitive fines resulting from that lawsuit. It is pointing to that litigation, and the cost of new federal air pollution control requirements, as part of a chain of pressures that threaten about 1,000 jobs on the side of AK’s Middletown Works, where steel is made.

“I remain disappointed that you continue to refuse to even consider the payment of a cash penalty as a part of settling the state’s claims against AK,” Jones wrote AK Chairman and Chief Executive Richard Wardrop.

“In fact, it would appear that this is a step backwards since at one point in the negotiations, between our lawyers, AK at least expressed a willingness to pay a ‘nominal’ penalty as a part of settlement,” Jones added in the letter.

A spokesman for Gov. Bob Taft has said that Jones had been trying to arrange a meeting with Wardrop. Jones’ letter is presented as a follow-up to a telephone conversation that the letter says Jones and Wardrop had on June 19.

But OEPA spokeswoman Heather Lauer said that as long as AK takes its current stance, “There’s no need for the meeting.”

In his letter, Jones extends an offer of $80 million in “low-cost financing” for AK to install equipment meeting new federal “maximum available control technology” guidelines against air pollution. Integrated steelmakers like AK have less than three years to meet the latest federal standards.

AK Vice President of Public Affairs Alan McCoy has said a previous offer of financing entailed a deadline that the company could not meet.

McCoy said Friday he had not seen Jones’ letter and could not comment.

Published 06.28.03



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