State environmental officials and the owners of the Sparrows Point peninsula are moving toward a settlement to correct alleged regulatory violations at the former steelmaking site.
Regulators say an array of problems have occurred over the past year on the 2,300-acre peninsula, including illegal open dumping of industrial sludge, improper handling of hazardous materials and the running of an unlicensed scrap tire operation.
"We are drafting a settlement in the form of a consent order which will provide terms and a schedule for corrective actions — and which will include a financial penalty," Maryland Department of the Environment spokesman Jay Apperson said in a statement. Apperson said the penalty amount has not been determined.
The steel mill at Sparrows Point, which employed tens of thousands in its heyday, closed in 2012. Officials are now eyeing the property, which has a decades-old history of environmental problems, for future economic development.
Baltimore County formed a partnership to explore ways to bring jobs to the peninsula. Last year, County Executive Kevin Kamenetz said county officials want to capitalize on the expansion of the port of Baltimore, with hopes of bringing a new marine terminal to the peninsula's Coke Point area. County leaders have said environmental contamination should not deter redevelopment of the land, contending much of the peninsula can be cleaned up in the near future.
In a December letter to owners Sparrows Point LLC and Hilco Industrial and to site contractor MCM Industrial Services LLC, Maryland Secretary of the Environment Robert Summers wrote that over the past year, inspections had revealed "a pattern of significant and ongoing violations of Maryland environmental laws" by the companies.
"Most troubling, however, is that many of these violations have been brought repeatedly to your attention and have been largely unaddressed," he wrote.
Since the letter was sent, representatives of the companies have met with state officials, Apperson said.
Randall Jostes, CEO of ELT, of which Sparrows Point LLC is an affiliate, said the company is working closely with the state agency to address the allegations.
The peninsula is a huge site "that has 100 years of history of steelmaking activity," he said.
"We're in the process of bringing down the legacy to reach the vibrant, redevelopment future," he said. "The process itself uncovers a lot of historical site issues and we are working with MDE on each and every issue discovered."
A spokesman for Hilco declined to comment. A spokeswoman for MCM said officials familiar with the matter were traveling and not available to comment.
Russell Donnelly, an Edgemere resident and environmental activist, said the community has dealt for years with polluted water in the area but has seen improvements in recent years. He said he doesn't want to see that progress reversed.
"I applaud MDE for at least keeping an eye out," Donnelly said. "I'm glad to see they're on the job."
The letter from Summers says the firms could have to pay substantial penalties.
Asbestos violations — which dealt with alleged failure to comply with regulations on packaging and processing asbestos-containing waste material — were initially corrected within 10 days, but then officials found other alleged violations, Apperson said.
The site has sparked environmental concerns for decades. In 1997, a consent decree was issued as part of a settlement between then-owner Bethlehem Steel and state and federal environmental regulators. The decree ordered Bethlehem Steel and any subsequent owner to investigate the existence of contamination and determine how best to remediate it.
Thus far, the current owners have not fully investigated the extent of contamination, said Jon Mueller, vice president for litigation at the Chesapeake Bay Foundation.
Mueller contends the new owners have tried to buy time and spread blame around about environmental problems on the peninsula.
"I think the government agencies are rightly concerned that the new owners are kind of playing the shell game," Mueller said, adding he was pleased that the state appears to be taking action.
The foundation, as well as Blue Water Baltimore and local citizens, sued the then-owner RG Steel in 2010, seeking an investigation and complete cleanup of the site. The lawsuit was dismissed in February through an agreement by all parties after they reached a plan to investigate off-site contamination, Mueller said.
The quick succession of owners has made it difficult to hold someone accountable and has "allowed this contamination to continue for years," Mueller said.
"There've been multiple owners since then, and the full investigation of the property hasn't even occurred, let alone full corrective measures," he said. "With all these different owners, it's made it really hard to pin somebody down to get this work done so these problems have lingered for a decade."
John Long, of the Dundalk-based environmental group, Clean Bread and Cheese Creek, said it's hard for residents to know what's happening on the peninsula.
"Nobody's communicated any type of oversight that's taken place on the dismantling process," Long said. "I think everyone would like to see the site become something that's useful and beneficial to the community, that's healthy."