Whirlpool announced Thursday (July 3) a settlement with south Fort Smith property owners in a class action lawsuit the owners filed after the company had disclosed that potentially cancer-causing trichloroethylene (TCE) had leaked into the groundwater and spread to the affected properties. TCE was used as part of a degreasing agent at the former Whirlpool facility until the 1980s, when its use was discontinued by the company.
A series of lawsuits were filed against the company in May 2013, with attorney Ross Noland of Little Rock-based McMath Woods Law Firm saying the suits were primarily focused on property damages, not health-related claims.
"There are some other elements of damage, but the primary is property damage and the reduction of value in the property," he said at the time.
Sebastian County Assessor Becky Yandell was responsible for dropping property values by an average of 41.2% in the area. She said her office had researched other TCE spills and the impact the spills have had on property values to come up with their total reductions in value.
A total of 55 land parcels, including 49 residences and three commercial buildings, had their values reduced in the plume area while properties on what Yandell called the "fringe" were also reduced, though by smaller amounts. In all, 26 parcels were impacted by the change in property values in the "fringe" area.
In an email announcing the settlement with property owners, Whirlpool Senior Manager of Global Public Relations Kristine Vernier said the resolution of what eventually became a class action lawsuit by property owners in the affected areas against the company was part of the company's ongoing commitment to the residents of Fort Smith.
"Whirlpool is pleased to have reached a resolution with property owners in a class action lawsuit related to contaminated groundwater near the former Whirlpool manufacturing facility in Fort Smith, Arkansas," she said. "As part of Whirlpool’s ongoing commitment to the residents of Fort Smith, this agreement will fairly compensate property owners, and enable both the residents and the company to focus on meeting the goals of the current remediation effort."
Following are details of the resolution, quoting from Vernier's email.
• The agreement covers current owners of property devalued in 2013 by the County Tax Assessor for tax assessment purposes as a result of groundwater contamination from trichloroethylene (TCE) released at the former Whirlpool manufacturing facility in Fort Smith, as well as some properties near the facility whose tax value assessment did not change;
• Property owners inside the area bounded by Ingersoll Ave, Brazil Ave., Jenny Lind Rd., and Ferguson St. will receive either an amount equal to the devaluation estimated by the County assessor or the devaluation as determined by an independent property appraiser;
• Class members outside this area will receive $5,000, and possibly more in the future, if TCE is detected above threshold levels in groundwater beneath their property;
• Property owners agree to allow access to their property for testing and remediation activities, record a deed restriction prohibiting new wells on their property, and release Whirlpool from property damage claims.
• Each class member will receive formal notice of the resolution, as well as an opportunity to opt out of the agreement;
• A federal Court will be required to approve the agreement; and
• Whirlpool has agreed to pay court approved fees and costs incurred by the class members.
It is unclear how many residents in the affected plume area or in the "fringe" areas will accept the settlement offer from the company. Resident Debbie Keith, who has been organizing efforts against Whirlpool in the neighborhood north of the former facility, confirmed she would not participate in the settlement offered by the company, but declined further comment.
Fort Smith City Administrator Ray Gosack called the settlement a "positive development."
“We’ve been made aware of the announced settlement between Whirlpool and many of our citizens in the vicinity of the company’s former facility. This is a positive development that helps property owners move forward,” Gosack said in a statement.
The statement from the city also noted that Mayor Sandy Sanders and the Board of Directors “have worked diligently on keeping the public engaged in this issue. In Whirlpool’s announcement, the company acknowledges the board’s work in addressing remediation and development activities.”
The settlement comes a week after the company was granted a 30-day extension by the Arkansas Department of Environmental Quality to install vapor monitors in structures within the plume area after the company said no area residents had agreed to grant Whirlpool entry for testing purposes. The settlement, as detailed above, would give the company property access rights should the property owner agree to the settlement.
Remediation efforts do continue, though it was revealed in May that contamination caused by TCE in and around the Whirlpool facility itself may, in fact, be worse than previously indicated.
A memo from the ADEQ said it appeared as though Whirlpool knew the extent of the contamination even while working with the agency on a remediation plan.
"Although Whirlpool collected this MIP data 4-5 months ago, no discussion of the results or ramifications of this data was supplied to ADEQ," the memo continued. "MIP data is presented in real time. Whirlpool certainly knew that this area was impacted prior to submitting the final Remedial Plan at the end of February."
Vernier said the settlement announced Thursday was "another significant step forward in Whirlpool’s ongoing work with Fort Smith residents and Arkansas state regulators to fairly and effectively address this issue.
"With the engagement and support of the Fort Smith City Directors and the oversight of the Arkansas Department of Environmental Quality, we continue to push ahead with the remediation activities and redevelopment of the Whirlpool property.
Whirlpool officials are scheduled to be in Fort Smith Tuesday (July 8) to provide an update on remediation efforts to the Fort Smith Board of Directors. ADEQ Public Outreach and Assistance Division Chief Katherine Benenati confirmed Thursday that the agency would be in attendance, as well. The meeting is scheduled to take place at 6 p.m. at the Fort Smith Senior Activity Center, 2700 Cavanaugh Road.