RMA Cleanup Billing In Question

[Aimee Houghton <aimeeh@igc.org>]

The following article appeared in the Sunday (2/1/97) edition of the 
Denver Post.

Aimee Houghton

*************

ARMY ROLE LAX IN ARSENAL BILLING
Cleanup poor, but public paid, study says
by Adriel Bettlheim

"The U.S. Army's lax supervision of the Rocky Mountain Arsenal cleanup 
allowed Shell Oil Co. to bill federal taxpayers for hundreds of 
thousands of dollars of projects that didn't remove any pollution and 
for $3.1 million in unsupported expenditures, a new government study 
concludes.

The U.S. General Accounting Office found that inadequate accounting 
controls led the Army to pass on to taxpayers a series of questionable 
or unsupported expenses.

Sen. Ben Nighthorse Campbell, R-Colo. one of three members of Congress 
to demand the study, was highly critical of the Army and demanded an 
explanation for the GAO's findings.

"Taxpayers deserve and demand more from the Army than having them hold 
open the hen house door while the fox cleans it out, " Campbell said.

In one instance, the report said, taxpayers picked up $670,000 in 
Shell's construction costs for a ne office building at the Superfund 
site, and paid the company's local property taxes for some pollution 
equipment. The Army couldn't document why the company didn't pick up 
any of the tab.

Taxpayers also paid $481,000 of Shell's public relations expenses, 
including a picture book of wildlife that populate the arsenal, 
promotional bald eagle pencils and a Bald Eagle Day.

In all, the GAO found 31 items totaling 3.1 million that packed propoer 
documentation.

Some other transactions involving environmental work also weren't 
properly documented, though the GAO said they may not have been 
improper. 

For instance, the GAO found Shell inexplicably got taxpayers to pay 
half the cost of a $4 million parcel of land the company purchased 
between Interstate 76 and the Denver International Airport.

The purchase allowed the Army to perform groundwater treatment 
activities immediately north of the arsenal. Army and Shell officials 
said the company was able to purchase the land faster than th Army 
would have been able to. Yet the transaction allows Shell to keep the 
land, which is suitable for commercial development, the study said.

"The Army's review of costs to be shared with Shell has been minimal," 
the GAO concluded. "Our work showed that additional documentation is 
available in most cases and could have been reviewed by the Army."

The GAO, the investigative arm of Congress, recommended the Army 
tighten its accounting system but stopped short of calling on Shell to 
make any financial reimbursements.

The study was commissioned by Campbell and Reps. Dan Schaefer, R-Colo., 
and John Dingell, D-Mich., after the Denver Post in 1995 reported 
numerous questionable costs related to the cleanup.

Campbell yesterday demanded that Army Inspector General Lt. Gen. Jared 
Bates find out what went wrong and report back by May 1. He added the 
Senate may hold investigative hearings into the costs.

The Army told the GAO it operated in an atmosphere of trust with Shell, 
adding it didn't think it had the right to meddle in the company's 
business with its subcontractors. A spokeswoman yesterday downplayed 
the seriousness of the findings.

"They suggested some procedural changes, but didn't find any financial 
improprieties," Army spokeswoman Ruth Mecham said. "The Army and Shell 
worked a long time with the GAO reviewing the matter."

Shell said the documentation it provided was sufficient to review cost 
claims.

"The conclusion that these costs lack the necessary backup is 
unfounded in Shell's view," arsenal site manager W.J. McKinney said in 
a written response to the study.

The Army and Shell contaminated the 17,000 acre arsenal for 35 years, 
turning it into one of America's most polluted sites. The Army made 
chemical weapons while Shell produced herbicides and pesticides.

Under a 1989 federal court agreement, the Army and Shell are splitting 
the costs of cleaning up the site. The total cost is expected to 
exceed $2 billion. Costs so far have totaled $700 million.

The GAO reviewed a total of 153 Shell spending items. The Denver Post, 
after a two-year battle, obtained 15,000 pages of recodsd showing Shell 
had taxpayers pay for an $8,888 one-day meeting in Aspen and three 
trips costing at least $5,000 to the company's international 
headquarters in The Hague, Netherlands."