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<< Previous   of   Next >> (click to enlarge)   ADVERTISEMENT   CONTACT THE HERALD Mike Benbow, Business Editor benbow@heraldnet.com   Published: Monday, July 7, 2008 How a London coffeeshop helped clean up Everett's waterfront About $11.5 million of cleanup of Everett's waterfront has been funded by insurance companies, such as Llyod's of London. By Mike Benbow Herald Writer EVERETT -- In 1688, a group of shipowners who hung out at Edward Lloyd's coffeehouse in London to hear the latest news about their vessels figured out that when their ships went down, they were ruined, but if they banded together to share the losses they could remain in business. Those individuals, called names, created what became the oldest active insurance marketplace in the world -- Lloyd's of London, best known for putting up millions of dollars to insure movie star Betty Grable's legs, guitarist Keith Richards' fingers and singer Celine Dion's vocal cords, among other things. Back in the 1960s, the names also insured what has proved to be a poorer risk, the Port of Everett. By the end of this year, Lloyd's and the port's American insurers will have paid the port $11.5 million, all to absolve themselves from liability for years of industrial pollution on the Everett waterfront. That's a lot of money, but the port has already spent $5.8 million during the past several years cleaning up just one area -- the north marina site in which it has plans for a $400 million redevelopment that would involve more than 600 waterfront condos and a number of commercial and office buildings. "The port has been pretty successful in getting some money from the insurance companies to pay for this," said the port's Larry Crawford. The port's legal efforts are bearing fruit now, but it's taken at least a decade to get to the payoff. The port started thinking about a lawsuit in the early 1990s when it pursued expansion plans for its marine terminals and discovered a number of industrial pollutants in the sediments. Instead of removing the pollutants, it essentially used them as fill, encapsulating them with clean material so that they wouldn't contaminate anything further. "Ports were the landlord to stimulate commerce and they had a heritage of industrial land with contamination on it," said Mark Nadler, a Seattle lawyer hired by the port to go after its insurance carriers when the problems were discovered. Nadler said he was able to do that because the Superfund program approved by Congress in the 1980s said insurance companies were liable for pollution damages extending back in time. In the 1960s, he added, Everett was among 30 regional ports that had bought insurance from U.S. companies and had banded together to get excess coverage from the names at Lloyd's. Much of the pollutants around the port came during that period. What was found around the port was some arsenic, a lot of cleaning solvents, some PCBs from damaged utilities poles, creosote and aromatic hydrocarbons that can cause cancer. Nadler sued both in Snohomish County and in London without a lot of immediate result. "One of the big tests from the insurance companies was to prove whether you were in it for the long haul," said John Mohr, the port's executive director. Nadler agreed. "The insurance carriers really wanted to test the mettle of their opponents to see if they really had to pay," he said. Ultimately, settlements were reached with all the companies and they were absolved from any further liability. "They all wanted their policies back so they can close the books on them," Nadler said. The settlement agreements contain secrecy clauses, but they were provided to The Herald after a request under the state open records act. Payments include $1.5 million from Consolidated American Insurance, $5.9 million from the London market, $3.5 million from Hartford Insurance and three settlements from insolvent insurers to be paid this summer totalling $429,222. The port's north marina cleanup, which has been going on for several years, was a voluntary one that is nearly finished. It's already removed some 86,000 tons of contaminated soil. When that job is done, there will be plenty more, all part of the state's Puget Sound Initiative, a program to clean up the area by 2020. In Port Gardner, the state and the port will team up to remove gasoline, fuels, metals and other substances. The state Department of Ecology also will conduct a bay-wide study to set priorities for cleanup in the lower Snohomish River estuary and Port Gardner. The nine sites identified by the state include: Everett Shipyard. Metals, petroleum products and other hazardous substances have been found in the area, much of it from leaks, spills, runoff and shipyard activities. In April, the port, Everett Shipyard and the state signed an order outlining cleanup efforts. North Marina. The port has completed an investigation and partial cleanup in soil and groundwater. Baywood site. The area may be contaminated by tanks and historical sawmill operations on the site. The port and the state are working on a cleanup order. Ameron/Hulbert site. Metals and other substances are in the soil and groundwater of the port site, likely from former lumber mill operations and stockpiles of debris. The state and the port are working on a cleanup order. Former Weyerhaeuser Mill A site. Pulp and paper operations from 1901 to the 1980s led to contamination by metals, dioxins, woodwaste and other materials. The state and the port are working on a cleanup order. Riverside Business Park. Arsenic from a former smelter contaminate the site. Cleanup depends on a bankruptcy settlement with the operator Asarco. Jeld-Wen. The state and the owner, Jeld-Wen Inc. have signed a cleanup agreement. Petroleum products and other pollutants stem from former tanks and from industrial operations. ExxonMobil Bulk Storage Plant. The state and the private owners are working on a cleanup plan. Petroleum spilled from tanks and wood waste debris have contaminated the area. East Waterway. Uses by the U.S. Navy, the port and Kimberly Clark have contaminated the sediment with polycyclic aromatic hydrocarbons, phenols and metals.

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