United States       Region V
Environmental Protection   230 South Dearborn Street
Agency         Chicago. Illinois 60604
A STATUS REPORT
The PCB Contamination
Problem: Waukegan, Illinois
November 24, 1980

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             THE PCS CONTAMINATION PROBLEM: WAUKEGAN. ILLINOIS

                              A STATUS REPORT

                             November 24, 1980
                             TABLE OF CONTENTS                        PAGE


SECTION I     INTRODUCTION AND BACKGROUND                              1

SECTION II    THE ENVIRONMENTAL PROBLEM                                5

SECTION III   PLAN FOR REMOVAL OF PCB CONTAMINATED SEDIMENTS           8
              IN SLIP #3 IN WAUKEGAN HARBOR

SECTION IV    POTENTIAL MECHANISMS FOR FUNDING SLIP #3 PLAN           11
                               Prepared By

                   U.S. Environmental Protection Agency
                                Region V
                        230 South Dearborn Street
                          Chicago, Illinois

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               SECTION I:   INTRODUCTION AND BACKGROUND
Since the initial  awareness of the existence of a PCB contamination problem
in the vicinity of the Outboard Marine Corporation (OMC)  facility in Wauke-
gan, Illinois, in  1976, the U.S.  Environmental  Protection Agency (U.S.  EPA)
has pursued remedy along two channels.

   o  After informal  negotiations with OMC  broke down  in  1977,  U.S.  EPA
      filed a  lawsuit  against OMC on  March 17,  1978,  seeking  to  require
      OMC to  cleanup  the  site.   April  6,  1981 has  been set as  the trial
      date.

   o  U.S. EPA began, in 1976, to conduct  studies  on the nature and extent
      of the  environmental problems  associated  with  the  PCB  contamination.
      In 1979, these efforts  were directed towards development  of  an engi-
      neering  remedy for the PCB problem in Waukegan  so that  U.S. EPA could
      begin cleanup as  soon  as  funds  became  available.  A  comprehensive
      report,  describing the full  range of problems and suggested remedies,
      will be  issued in December 1980.

BACKGROUND

In 1976, the  Johnson  Motors  Division of Outboard  Marine Corporation (OMC)
in Waukegan,  Illinois,  was found to be discharging  PCBs to the  Waukegan
Harbor and the North Ditch, both  tributaries of  Lake  Michigan.   This find-
ing was  of  great  concern  as  a number  of  Lake  Michigan  fish species  both
then and now contain PCBs in quantities exceeding Food and Drug  Administra-
tion Guidelines.   Administrative orders were issued by the U.S.  EPA and the
Illinois Environmental  Protection Agency   (IEPA)  requiring the   company  to
take certa n  steps  to eliminate  discharges of PCBs.   Although  those steps
were taken, and  discharges were  significantly  reduced, a  great deal  of
damage had already been done.

It was learned that during the years from at least  1959 to  1971,  the  com-
pany purchased approximately  9 million  pounds  of PCBs for use in hydraulic
equipment of  its  aluminum  die cast  machines, and  a  substantial  amount was
discharged to  the  harbor and  ditch.   Some of  the PCBs  were carried  into
the Lake  where they  contribute  to  the  Lake   Michigan  PCB   contamination
problem.  The   rest  of  the PCBs   remain to  contaminate  the   sediments  and
biota of  the   Ditch  and  Harbor,   and  also  to  be  transported   into  Lake
Michigan.
                                  -1-

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SUMMARY OF THE LITIGATION

Following the breakdown  of  negotiations  between the State of  Illinois  and
OMC during late 1977, the United States Attorney  for the  Northern  District
of Illinois filed suit on behalf  of the  U.S. EPA in federal  court against
OMC on March  17,  1978.   The complaint alleges that OMC utilized  hydraulic
fluids composed  of  PCBs  in its Waukegan  diecasting  facility  of  Johnson
Outboards for many years, and  that  the leaks and spills  of the  fluid dis-
charged without treatment into Lake  Michigan  and Waukegan Harbor were  a
violation of the  Refuse  Act, the Clean  Water Act, and the  common law  of
nuisance.  The United States further alleges that, as a result,  Lake Michi-
gan waters and  aquatic  life have been harmed  and pose a threat to health
and the  environment.  The  complaint  asks  that OMC dredge  and dispose  of
North Ditch  sediments  in a  safe manner,  similarly  clean up  contaminated
Harbor sediments, and pay a  money penalty for violation of the  Clean  Water
Act.

OMC subsequently filed a third-party  complaint  against its supplier of the
PCB-bearing hydraulic fluid, alleging negligence  and  a breach  of  products
liability law by the Monsanto  Company as the manufacturer and  supplier  of
the PCBs.  In addition,  after  a  review of documents  produced  in discovery,
the United States also sued Monsanto in July 1980, alleging  violations  of
the Refuse Act,  and negligence  and  products  liability  standards  in  Mon-
santo 's conduct as supplier  of  the PCBs.

Following the claim,  Monsanto  recently filed  a crossclaim for  reimburse-
ment against  OMC.   Finally, pursuant ..to :a. ruling by  the-Seventh  Circuit
Court of Appeals, the  State of Illinois has been allowed to  file  its  own
suit in  federal court against  OMC.   While the  State is currently  partici-
pating in  discovery,  OMC has  filed  a petition  for  certiorari  with  the
Supreme Court asking for review of the Circuit decision.   The  Supreme Court
has not yet ruled whether it will  consider the case.

Exchange of documents and interrogatory responses  is  substantially complete
in the enforcement case,  and a  number of depositions  have  been scheduled  in
the next months.  United  States  studies  concerning the extent  and gravity
of the contamination  are expected  to be  completed  by  the end  of  December
1980.  A  discovery  termination date  of  March  1, 1981,  and  a trial  date
beginning April 6,  1981, have been set  by  the presiding judge.   Whether
the case is resolved through settlement negotiations, the  judge's  decision,
or a jury's  verdict, payment  for  cleanup  and disposal has been  requested
by both  Illinois  and  the   United  States primarily  of OMC  as the direct
discharger, and also of  Monsanto as the manufacturer and  supplier  of PCBs.
                                    -2-

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In a related  but  separate action  filed  by OMC  against U.S. EPA  in  March
1978, two of its claims under the Clean Water  Act  alleging  U.S.  EPA respon-
sibility for study and cleanup  of  Waukegan Harbor were denied  upon motion
for summary judgement  by  U.S.  EPA, and the third  claim under  Section  115
is awaiting trial  before Judge Leighton.
                                  -3-

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                   SECTION II:  THE ENVIRONMENTAL PROBLEM
The environmental studies begun by U.S. EPA in 1976, to determine the nature
of the PCB  problem  and its associated environmental  impact,  have included
sampling and  chemical  analyses  for  sediments,  water,  soil,  groundwater,
fish and airborne fallout with  emphasis on Waukegan Harbor, the North Ditch,
the Johnson Outboards  site, and  nearby areas  of Lake  Michigan.   Biological
engineering and transport  studies  to  estimate the loading of PCBs  to Lake
Michigan have been conducted.

We have determined  that PCBs  are  distributed  throughout  Waukegan  Harbor.
About 15,000 cubic yards  are  estimated  to be contaminated beyond 500 ppm,
about 65,000 cubic yards beyond 50 ppm and substantially more yardage beyond
the 10 ppm  level.   The PCBs  become suspended  or dissolved and  enter Lake
Michigan;  additionally fish that  frequent the harbor develop high PCB levels
as a result  of exposure  to  contaminated sediment  and  elevated  levels  in
water.   Studies have indicated that resident  fish  in  the  harbor accumulate
PCBs at levels well  above the  current level  of  5ppm  PCBs  and the proposed
level of 2 ppm established by  the  Food and Drug Administration.   Bluegills
and perch  exposed to harbor waters  for 30 days have accumulated  averages  of
20 ppm and 12 ppm, respectively.   Studies also indicate  that  fish lose PCBs
when they  return to Lake Michigan but  still  retain PCBs  at an  average level
of about 8  ppm  afrter 84 days in  the Lake.   Information  available  to the
U.S. EPA  indicated  that fish  exposed  to sediments contaminbatedwith PCBs
will bioaccumulate PCBs above  FDA limits  when  sediments  exceed 10 ppm..PCBs;
Region V,  U.S.  EPA,  defines  sediments at 10  ppm as  "highly  polluted"  and
unfit for  lake disposal.

The most  significant  environmental problem  in Waukegan  Harbor  is the con-
tamination in Slip  No. 3.  A  substantial  amount  of  the  sediment in  Slip
No. 3 is contaminated beyond  the  500  ppm  level,  with some  locations  exceed-
ing 200,000 ppm (20% dry weight).  This  is where an OMC  outfall  was  located
and is the most contaminated  area of  the  harbor.

CONTAMINATION OF FISH IN WAUKEGAN HARBOR

The U.S.   EPA  has completed  several  fish studies in or  utilizing  waters
taken from Waukegan Harbor.  The purpose  of the  studies,  completed  in mid-
1980, was  to help determine the extent to which  Harbor sediments serve as a
source of  contamination in Lake Michigan  fish.
                                   -5-

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Two types of studies were  conducted.   In  the  first,  random  samples of fish
were collected from Waukegan Harbor water  and analyzed  for  PCB levels.   In
addition, uncontaminated fish were exposed  for 30 days to the waters of Slip
No. 3 on the Harbor,  then removed  and  placed for 84 days in water taken from
the open lake.  These fish were then  analyzed to  ascertain  the persistence
of PCBs  they  bioaccumulated  while  in Harbor waters.   In  each case,  PCB
levels in the fish were measured  for purposes  of determining whether or not
they exceeded the existing Food and Drug Administration (FDA)  guideline of
5 mg/1, or the proposed guideline of 2 ppm.

Analyses of 17 fish samples collected  in  Waukegan Harbor averaged 19 ppm of
PCBs for whole  fish.  All but three samples exceeded the 5 ppm FDA guideline
for the edible portion, and all but one  exceeded the 2  ppm  proposed limit.

The uncontaminated fish exposed to  Waukegan Harbor  waters  retained levels
of PCBs approximating 20 ppm for  whole fish (bluegills)  and 12 ppm (yellow
perch) after 30 days  of  exposure.   Levels remained at 8 ppm for both species
even after 84 days of exposure  to  "open" Lake Michigan water.  In evaluating
this data,  one  should  note that  the  edible portion of  a   fish  is usually
lower in PCB concentration  than the whole fish.
                                   -6-

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                              FIGURE NO. I


                      EXTENT OF PCB CONTAMINATION

                      BOUNDARIES ARE ESTIMATES AND
                      WILL BE CONFIRMED IN DECEMBER,
                      NO SCALE

                        I    I   GREATER THAN 500 PPM

                               50-500 PPM

                               LESS THAN 50 GREATER
                               THAN 10 PPM

                               10 PPM OR LESS
               SLIP NO,3
    SLIP NO,I
                                 LARSEN
                                 MARINE
WAUKEGAN
PORT
DISTRICT
                             JOHNSON
                             OUTBOARDS
CITY
FILTRATION PLANT
                                                 LAKE MICHIGAN
                                   -7-

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      SECTION III:  PLAN FOR REMOVAL OF PCBs CONTAMINATED SEDIMENTS
                      IN SLIP #3 IN WAUKEGAN HARBOR
We propose to begin  cleanup  in this area and proceed by  building  a lagoon
of 55,000 cubic yards  capacity on  OMC property.  Then, 15,000  cubic  yards
of sediment along with  35,000  cubic yards of water will  be  dredged with a
Hydraulic Suction Pipeline Dredge  and  placed in the lagoon.  The  sediment
will be de-watered  and the water  treated with  an activated carbon system
to a less than 1 ppb level of PCBs  before being returned to Waukegan Harbor.
A small sand filter and carbon filter system will  provide  continuing treat-
ment of runoff.   This cost is estimated at more than two million  dollars and
will not  include  disposal of  the  sediments from  the  lagoon.   The lagoon
will be designed to  prevent  release of PCBs to the environment  until  such
time that permanent  disposal  of the de-watered sediments  can be  arranged.
We are  investigating landfill ing  and  other  alternate  treatment  and  dis-
posal possibilities.

ENGINEERING SUMMARY FOR SLIP #3 DREDGING TREATMENT AND  STORAGE  SYSTEM

The summary encompasses the scope and costs  associated  with the  engineering
design and construction related to  a dredging, treatment and  storage system
for 15,000 cubic yards of PCB contaminated  sediments presently  located in
Slip No.  3  of Waukegan Harbor,  Waukegan,  Illinois.  The  project  includes
dewatering the dredge spoils  in a lagoon on OMC property and returning clean
(less than^one   part  per -billion  PCBs)  water back  to  the Harbor.   The
dredge spoils would  remain in this  lagoon  until  monies are available  for
transportation to a permanent disposal  site.

DESIGN OF LAGOONS

The lagoons would  be built on top  of  the surface, with  one foot  of  clay
base, six inches of  sand-gravel  containing  a leachate  collection  network,
and three feet of compacted clay above the sand-gravel.

The lagoons will be  sized to hold  all  the material  removed from the harbor
plus adequate freeboard.  Laboratory tests have demonstrated  that  a minimum
of two days (longer  times are more  desirable)  of settling  and dewatering
are required before  the dredged  sludge is dewatered to the  point  where it
can be hauled to a landfill.  The  longer the dredge spoil   set  in  a lagoon,
the greater extent they are dewatered.

Quantities of Harbor sediments (all  of the  muck  down  to   sand  or  clay  but
not including sand or clay) to be removed are estimated below:

      Location          Concentration of PCB         Quantity  (cubic yards)

    Slip 3 only            over 500  ppm                       15,000
                                   -8-

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The following Lagoon  capacity  is  needed for removing the  Harbor sediment:

Sediment Removed         Total  Lagoon Capacity         Lagoon Configuration

  15,000 yds.             55,000 yds.                    One Lagoon

The lagoon has 2 feet of freeboard not figured  into the  capacity.

The 55,000 cubic yard lagoon capacity  is  based  on slurrying  15,000  cubic
yards of  sediment  in  Slip  3  with  35,000  cubic yards  of water,  plus  10
percent reserve.   The  entire  slurry  is  transferred  to  the  lagoon,  and
the excess water is  returned to the Harbor when  the dredging  is complete.
This method  is  less  costly  than  providing  a  smaller  lagoon  (say  30,000
cubic yards)   coupled with  a much  larger  water  treatment plant  sized  to
keep up with the dredging.

Preliminary calculations  show  that 15,000  cubic  yards can  be  dredged from
the harbor and  treated  (dewatering in a lagoon,   water returned  to harbor)
but not including  final  hauling  to a landfill  at  a  cost under $2,000,000.

The 55,000 cubic yard lagoon is located in a certain area of  OMC property
with the  possible   contingency that  a  second  55,000   cubic  yard  lagoon
can be  later constructed  adjacent  to  the first lagoon  when  monies  are
available to dredge  more of the  Harbor  (see  Figure 1).    The  lagoon  walls
can at  a  still  later date be  built higher to provide additional  capacity
if needed.  The maximum possible total capacity that can  be safely provided
on the  space available is estimated  to  be about 400,000  cubic  yards;  the
lagoon walls  would be  built to  hold a  20  feet  depth of  dredged  material
with this  configuration.   The  dredge  solids  can  be  stored in  the lagoon
until everything is  removed  as funding  becomes available  to remove and/or
treat more Harbor  solids.

WATER TREATMENT

A weir  exists at the end of the  proposed  lagoon which  controls the water
level in the lagoon.  The lagoon water spills over into  a compartmentalized
basin.  This  consists  of a  flocculation  area   where   polymer  is  added,
followed by  a two  hour detention  for   settling   of  solids, and  a  small,
clear well where   a  pump  operating  off level  controls  delivers  water  to
sand or  dual media  filters  and  carbon filters.  Another  clear  well  is
provided for  finished  water  before  discharge  to  the  harbor;  this  water
can also  be  used  to  backwash  filters.  The treated  water is  returned  to
the harbor.   Sand  or dual media  filters and  carbon filters can be retained
on a  rental  basis.  In addition,  a  smaller  sand filter and carbon filter
can be  purchased to  handle  leachate and rain water  after  the  sludges have
dewatered.

In the  interest of  saving   money,  operations  can be carried  out  during
the non-freezing  weather months   (April-October)  so that a  building  to
house equipment need  not  be  constructed.  Hoses  lying on the ground convey
                                   -9-

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water between equipment (if  a  break occurs, the  water is returned  to  the
lagoon).   A small building houses the permanent filters  used  to  treat  rain
and leachate water when the  dewatering  is completed.  A  suitable  emulsion
is spread  on  the  sludge  surface  after dewatering  for  dust control   and
prevention of volatilization  of PCBs to  the atmosphere.

COST

Costs for removing 15,000  cubic yards from Slip 3, dewatering  in  one 55,000
cubic yard  lagoon  and  returning treated  water back  to  the harbor  (less
than 1 ppb)  are estimated to  exceed $2  million.   Costs for construction
of the lagoon are included.
                                   -10-.

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      SECTION IV:   POTENTIAL  MECHANISMS  FOR  FUNDING  SLIP  #3  PLAN
There are four possible sources for funding of the plan to remove the con-
taminated sediments from  Slip No.  3.

     1.  In the fall of  1980 Congress  appropriated $1.5 million  in  FY81
         funds to U.S.  EPA "to begin  the  cleanup  of Waukegan  Harbor."   It
         is understood  that  EPA will  attempt to  recover such costs  from
         OMC through litigation.

     2.  Pursuant to Section 311  of the  Clean  Water  Act,  U.S. EPA  can
         initiate action  to  eliminate  a  pollution  threat to a  navigable
         waterway of the  United States,  if  the  owner or operator of  the
         site is unable or unwilling  to abate the threat.

         On November 14,  1980, U.S.  EPA wrote to  OMC, citing Section  311
         and demanding  that the company begin the cleanup of Slip No.  3.
         A response from  OMC is required  by  December 3.

         On November 20,  1980, at  a  meeting  of  the  Regional   Response
         Team, U.S. EPA's plan for cleanup of Slip No. 3 was  endorsed,  and
         authorization  was given  for expenditure of $100,000 of  Section
         311 funds for the engineering design studies,  if OMC refuses to
         take the  action.   Should U.S.  EPA  proceed to do  the  cleanup
         under Section  311,  OMC could  be liable  for the costs  incurred.

     3.  Legislation currently pending  in Congress, known as  "Superfund",
         would provide  funding for cleanup  of problems such as  the  con-
         tamination of  Waukegan Harbor.

     4.  It  is  anticipated that  the litigative  action  against  OMC  will
         result, either  through  settlement  or court  decision,   in  OMC's
         and/or Monsanto's assumption of  costs incurred in the Slip  No.  3
         cleanup operation.
                                   -11-

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