Judge says Merced cement firm had illegal paint shop

A Merced-based concrete company operated an illegal paint shop, violated numerous state hazardous waste laws and hid their conduct from local regulators, a Merced County judge has determined.

Merced County Superior Court Judge Ronald Hansen issued an Oct. 19 statement of decision in a civil action brought by the state against Central Valley Concrete. The suit alleged CVC operated an unpermitted paint shop at its main Merced plant, producing air emissions and hazardous waste, among other violations.

In his decision, Hansen issued an injunction prohibiting CVC from failing to comply with any applicable provisions of the state's hazardous waste control laws. He also ordered CVC to pay nearly $300,000 in civil penalties for the violations.

Matthew Maclear, the attorney who handled the case with Deputy Attorney General Brett Morris, said it's unknown whether CVC employees or anyone else suffered medical issues from hazardous chemicals or contaminants at the paint shop.

Morris said the operation wasn't a "little unpermitted shop," saying CVC was painting at least 50 cement trucks a year. "They were having emissions -- from the spray itself, the paint, the thinners, lacquers and everything they were mixing into the paint, as well as the sand blasting."

James Betts, the Fresno attorney who represented CVC, said he couldn't comment on the case, but released the following statement: "We respect Judge Hansen's opinion. Because this matter remains pending, we believe that it would be inappropriate for CVC, or this office, to comment at this time. CVC's objections are due to be filed November 3, 2010, and I will provide (the Sun-Star) with a copy of filing."

Prosecutors say CVC was trying to cut corners by painting the trucks at their own facility, rather than pay a market price. "We believe there was a profit motive behind this," Maclear said. He's the statewide circuit prosecutor for the California District Attorney's Association, who handled the case as a deputy district attorney on behalf of district attorneys' offices in Merced, Stanislaus and Madera counties.

Hansen's decision came after a civil trial, which began in late April. The statement of decision, while preliminary, isn't the court's final judgment. Hansen will rule on any objections from CVC's attorneys before issuing that final judgment. It's unknown when Hansen will make his final decision.

In making his decision, Hansen considered evidence from the paint shop's operation from 1999 to 2007.

Founded in 1981, CVC primarily produces, sells, and delivers sand, gravel, asphalt and concrete. The company operates three facilities in Merced County, two sites in Stanislaus County and one in Madera County.

Whistle blower

The state filed a suit against CVC after a whistle blower, a former employee, contacted the San Joaquin Valley Unified Air Pollution Control District in early 2007 about an unpermitted paint shop at CVC's 3823 N. Highway 59 location. At the shop, the company was painting large equipment, cement mixers and dump trucks, Maclear said.

There were also cases where the company was using the paint shop to work on vehicles belonging to private individuals and other companies without a permit. When the control district's inspector would arrive at the site for an annual inspection, Maclear said CVC management would conceal the paint shop from her. "Management would then go out, shut down the paint booth, take down the signs, shut the doors and not lead her into the building," Maclear said. "This paint shop had been in operation in Merced for decades, without being permitted."

CVC management was asked about the building, but Maclear said they referred to it as storage. "The way they perpetuated that intentional concealment is by misrepresenting what was inside of that building," Maclear said.

After the whistle blower stepped forward, the Merced County Division of Environmental Health was also notified. Environmental health inspectors found dozens of violations at CVC's sites in Merced County. "The whistle blower's allegations were corroborated through the inspections and also through the testimony of the former employees," Maclear said.

As part of his decision, Hansen determined operation of the paint shop resulted in the "violation of a multitude of laws and regulations aimed at the protection of the environment and people from hazardous materials and hazardous waste and harmful emissions."

The shop operations generated hazardous waste in the form of paint chips combined with dust, solvents, soil and/or sandblasting material -- and a portion of the materials was sprayed into the air. Some of the solvent was poured onto the ground, Hansen determined.

Paint shop employees also weren't trained about the recognition of handling of hazardous materials. "CVC ownership and management was, and is, sophisticated, successful and tough in its business operations, but appeared to view compliance with environmental laws applicable to paint shop operations as a cumbersome nuisance," Hansen wrote.

CVC also operated a 50-plus horsepower diesel engine in the paint shop to sandblast cement mixers, trailers, equipment and parts of truck tractors. Even though the engine was observed to emit smoke in excess of Air District standards, CVC never attempted to get a permit for the engine, Hansen determined.

Among other violations, Judge Hansen also determined CVC failed to properly identify all hazardous materials and waste at each Merced County site, properly label and cover hazardous waste containers, maintain required waste accumulation records and keep its hazardous waste streams properly segregated and identified.

Maclear said the Merced County Planning Department and the Merced County Fire Department never received applications for permits for the paint shop, which are necessary because of the flammable materials.

Calls were also placed Friday to Scott Neal, CVC's co-owner and president, and Chuck Salkenstein, CVC general manager. Those calls were not returned by Friday evening.

In court, CVC's attorneys maintained they didn't need permits because the paint operation began before the applicable regulations existed, Maclear said. CVC's attorney's also claimed if there were violations, they were merely paperwork and labeling-related.

Maclear said the violations were a much bigger deal than paperwork. "Those violations related to paperwork actually culminated in jeopardizing the safety of CVC employees, it jeopardized the safety of first-responders should there been an emergency and it culminated in the disposal of hazardous waste into the trash, into the air and the paint chips and dust that were falling to the ground, that was then illegally disposed of around the counties in asphalt projects," Maclear said.

After the violations came to light in 2007, CVC did obtain a permit for the paint shop and sandblasting operations. Use of the diesel engine stopped, and there has been no further sandblasting since April 2007. The paint shop has been little used since April 2007, according to Hansen's statement of decision.

If CVC, which remains in operation, fails to comply with the states' hazardous waste laws in the future, Maclear said the company could be subject to more civil -- or even criminal -- penalties. In the meantime, Maclear said he hopes CVC will change its practices on hazardous waste. "I can only hope they take an earnest interest in complying with the environmental workplace regulations applicable to them," he said.

Reporter Victor A. Patton can be reached at (209) 385-2431 or vpatton@mercedsun-star.com.

This story was originally published October 30, 2010 at 2:54 AM with the headline "Judge says Merced cement firm had illegal paint shop."