A shuttered cement plant becomes a metaphor for political change

CASTLE HAYNE, N.C. -- Along the Northeast Cape Fear River, silos of an abandoned cement plant rise 20 stories over a rusty dock that was once used to load cement for the trip to nearby Wilmington. Downriver, an idle red-and-white smokestack towers over the trees.

This moonscape of abandoned industry in southeast North Carolina has been home to the state's biggest local battle over air quality. The site once hosted Ideal Cement, a major cement manufacturer that opened 50 years ago but shuttered operations in the early 1980s. Beyond the trees and out of view from the river lies a massive limestone mine. A major company is hoping to build one of the nation's largest cement plants -- with silos twice the size of those overlooking the river now -- on the site within the next decade.

Titan America LLC already has faced five years of resistance from local activists, who say the new plant's emissions would make New Hanover County's air some of the dirtiest in the state.

But the battle over Titan has recently taken on greater meaning.

The prospective plant has become wrapped up in bigger battles environmentalists are waging to protect regulations they credit with making the state a historical leader in air quality. Over the last few years, North Carolina's Legislature, newly under Republican control, has enacted myriad laws to make it easier for businesses to obtain environmental permits and to ensure that the state's regulations are no stricter than those from the federal government or neighboring states. Most recently, Republicans tried to eliminate a network of air pollution monitors, including one that would have tracked levels of smog-forming emissions across the street from the plant.

In short, the state Department of Environment and Natural Resources has adopted a much more "customer-service" tone toward the regulated community under Secretary John Skvarla, an appointee of Republican Gov. Pat McCrory.

North Carolina GOP leaders and the business community say they're making the state more attractive to industry. But environmental and public health advocates are concerned that their new crop of leaders are backtracking on two decades of gains in air quality in their haste to open the doors to industry.

The fight over Titan's cement plant represents a "fork in the road" of that larger showdown, said Kayne Darrell, a resident of Castle Hayne and one of the leaders of the grass-roots coalition opposed to the plant.

"If this huge polluting cement plant comes here, then there's no turning back," she said. "But if we can stop this, we have an opportunity to go down a better, cleaner path."

North Carolina has a history of getting ahead of federal regulations and leading its neighbors in air quality. In the late 1980s and early 1990s, the state was an instrumental part of the Southern Appalachian Mountains Initiative, a voluntary partnership of local and federal government agencies and stakeholders to model air quality impacts and to examine the role of incentives in reducing emissions.

In 1990, under a Republican administration, the state enacted air toxics regulations to stem hazardous emissions such as mercury and benzene that are linked to cancer and other adverse public health effects.

Then, in the early 2000s, utilities and environmentalists sat down together and came up with a plan that became the state's seminal piece of environmental legislation, the Clean Smokestacks Act. Enacted into law in 2002, it required reductions of air pollutants from coal-fired power plants and included offsets for utilities such that it would not cost anything for them to shutter old, inefficient plants. As a result, utilities in the state phased out many of their oldest coal-fired power plants. In the mid-2000s, North Carolina also sued the Tennessee Valley Authority for air pollution that had blown over from Tennessee, Alabama and Kentucky, a lawsuit that was eventually settled in 2011 when TVA agreed to resolve alleged Clean Air Act violations.

Duke Energy Corp. and Progress Energy Inc. -- which merged in 2012 -- reduced their emissions of nitrogen oxides by 83 percent and sulfur dioxides by 89 percent relative to 1998 levels thanks in large part to the Clean Smokestacks Act, according to a 2013 report by the state Environmental Management Commission. The act was also instrumental in reducing emissions of fine particles and in helping areas of the state meet the federal fine particulate matter standard. In 2014 there was only one area in the state, Charlotte, that was out of compliance with the federal ground-level ozone standard. Between 1998 and 2011, toxic air emissions decreased in the state by 62 percent, according to a December 2012 report by the Department of Environment and Natural Resources' Division of Air Quality.

"I clearly would say that within the Southeast specifically, and I even would say nationally, that North Carolina's air program was respected as a leader both for having stringent rules and requirements and having some of the best science," said Ryke Longest, director of the Environmental Law and Policy Clinic at Duke University and a former state environmental enforcement attorney. "We had a situation where our Legislature at one time, in the late 1990s and early 2000s time frame -- they were willing to say that clean air was so valuable that we're willing to spend the extra money to allow the utilities to close some of these older coal-fired plants and replace them with more efficient and less polluting newer plants."

The dramatic improvement in air quality brought on by the Clean Smokestacks Act and other regulations has correlated with fewer deaths from respiratory diseases over the past two decades, according to a recent study by researchers at Duke University. Death rates between 1990 and 2010 fell for emphysema from about 11 in 100,000 people to fewer than eight in 100,000; for asthma from about five in 100,000 to fewer than three in 100,000; and for pneumonia cases from about 90 in 100,000 to about 60 in 100,000.

A separate recent study by researchers at the University of North Carolina, Chapel Hill, found that the Clean Smokestacks Act was responsible for preventing about 1,700 premature deaths in 2012.

"These observations are really valuable because they tell us that we need to work on better air quality and try to control all emissions," said Julia Kravchenko, a co-author of the study and a research scientist at Duke University's Department of Surgery.

The state was well ahead of federal activity in the cases of both the air toxics rules and the Clean Smokestacks Act. The toxics rules came out after several highly publicized incidents in the state dealing with toxic air pollution; at the time, U.S. EPA was only just beginning to contemplate regulating major sources of hazardous air pollution. The Clean Smokestacks Act was similarly set in motion in anticipation of tighter standards for NOx and sulfur oxides from EPA.

"In 2002, I think the utilities clearly believed that tighter controls on NOx and SO2 were coming and were coming at the federal level, and I think what the bill did was get ahead of that federal process that everybody believed was coming soon," said Robin Smith, former assistant secretary at the state Department of Environment and Natural Resources who oversaw the implementation of the Clean Smokestacks Act. "It gave the utilities more time since they were starting earlier, not waiting for the federal rule."


Since those laws and regulations were put in place, though, the state has undergone a major ideological shift. Republicans in 2010 took power over both chambers of the North Carolina Legislature for the first time since the 1870s. Two years later, Democratic Gov. Bev Perdue declined to run for another term, and McCrory, a former Duke Energy executive who had lost to Perdue in 2008, won the governor's seat.

The changes at the top have been reflected in moves by the Legislature beginning around 2010 to make North Carolina more amenable to business. In the environmental space, that has broadly meant the elimination of certain regulations and a return to what are known by North Carolina politicos and environmentalists as the "Hardison amendments." The phrase refers to a series of actions in the 1970s sponsored by then-state Sen. Harold Hardison (D) that kept the state from enacting environmental regulations that were more stringent than federal standards.

"What they're talking about is this idea that EPA's regulation of something is not only the floor but it's also the ceiling," Longest said.

'Regulatory reform' an annual event

That idea has manifested itself in a new tradition taking hold in the Legislature: passage of regulatory overhaul bills.

In 2011, legislators overrode a veto from Perdue to enact a bill that prohibited state regulators from implementing new rules stricter than federal agencies. The next year, legislators targeted the state's landmark air toxics rules, exempting any sources from obtaining permits if they already had to obtain an EPA permit for toxic air pollution.

A 2013 reform bill required that regulations be reviewed and readopted every 10 years, meaning the requirement that no rules be more stringent than federal regulations would now be applied to existing regulations. The bill also relaxed certain state rules covering the open burning of leaves or other debris -- some of the earliest air regulations enacted in North Carolina -- because they weren't required by the federal government.

"We've basically moved into a landscape where there's the annual regulatory reform bill. It's kind of like reducing taxes. It's almost de rigueur now," said Molly Diggins, state director at the North Carolina chapter of the Sierra Club.

Industry and business groups welcomed the new regulatory atmosphere. According to the North Carolina Chamber of Commerce, job creators had been shackled by an "increasingly complex and costly regulatory system."

"With great strides made in recent years, the North Carolina Chamber supports further increasing regulatory efficiency that balances job creation and environmental protection by creating a more streamlined and transparent rulemaking process," the chamber said in touting its success in gaining passage of the recent regulatory reform measures.

Industry had long called for changes to the air toxics regulations, but until Republicans captured both houses, the Legislature hadn't moved any reform measures. Industry broadly argues that EPA has caught up and issued dozens of rules governing hazardous air pollutants since the state measures were put in place. In 2011, letters to state legislators, five large companies -- Duke Energy, PCS Phosphate Company Inc., Nucor Corp., Domtar Corp. and Evergreen Packaging -- said the state requirements added significant burdens and costs to the air permitting process.

"I've heard a lot from the business community complaining about the air toxic laws and rules that we have, and about how burdensome they are and how expensive they are and how North Carolina goes way beyond what other states do, and how that hurts us competitively as far as business goes, as far as even recruiting businesses to North Carolina," then-state Rep. Mitch Gillespie (R), who shepherded the air toxics reform into law and who is now No. 2 at the Department of Environment and Natural Resources, said in an interview with

The first reforms came during a transition period when the Legislature was under Republican control and the governorship was still held by a Democrat. State Rep. Pricey Harrison (D), who was an environmental activist before being elected in 2004, said the general thinking was that the dynamic helped prevent a wholesale gutting or elimination of the rules.

"There was just a constant battle to fight back attempts to eliminate our air toxics program," Harrison said. "I think that, and I'm not particularly partisan, but when the Democrats were in control they put a higher premium on protecting the public health and adequately funding the Department of Environment and Natural Resources."

Some environmentalists blame the pursuit of hydraulic fracturing in the state for the onslaught of anti-regulatory measures. State leaders, they charge, are inadvertently affecting places like Castle Hayne in the southeastern part of the state -- home of the proposed cement plant -- in their rush to remove regulations to prepare the state for fracking (E&E Daily, July 22).

For Castle Hayne air advocates, the most worrisome proposals from the Legislature came this year. State legislators proposed to eliminate all air monitors that are not specifically required by federal environmental regulators and to limit citizens' ability to challenge air permits in court, taking away two important tools used by citizens to challenge projects they deem risky to public health. The changes were never enacted.

The air monitor provision would have eliminated an air monitor that lies across the road from the proposed cement plant and next to an experimental field for different varieties of blueberries. The monitor is 11 miles from downtown Wilmington and measures concentrations of ozone, particulate matter and other pollutants. The other provision would have hampered advocates' ability to challenge the cement plant permit's allowances of toxic air pollutants.

There has already been a protracted battle over the cement plant. The state and Titan America in 2009 announced the proposal to build the plant in Castle Hayne on the site of the empty Ideal plant, and the state offered the company $4.5 million in incentives and approved an air quality permit. "A cement plant in North Carolina complements Titan America's geographical presence and provides a resource for an area of the country that is expected to have significant growth over the next 30 years," Titan spokeswoman Kate McClain said.

Local advocates and environmental groups immediately challenged the permit based on public health impacts, worried over the large amounts of mercury, particulate matter, sulfur dioxide and NOx that the plant would be allowed to emit. They argued that a large industrial facility does not belong in the second smallest and second most densely populated area in North Carolina. But in the middle of the challenge process, EPA released a proposal for tighter cement kilns, and in response, Titan revised the permit to have lower emissions. But when EPA finalized a rule that was weaker than the proposal, Titan revised its permit to emit more pollutants.

According to its permit, Titan would be allowed to emit 182 tons per year of fine particulate matter, making it the largest source of fine particles in New Hanover County and moving New Hanover County from 11th to fifth place in the rankings of top fine particle emitters in the state. The plant's emissions would also rank it among the largest sources of SO2, NOx, carbon monoxide, volatile organic compounds, mercury, ammonia, benzene and other hazardous pollutants in the county. The company says it would have the same emissions with or without the state air toxics rule.

The allowances run contrary to the "entire spirit of the Clean Air Act," said Kemp Burdette, the Cape Fear riverkeeper who grew up in the area and remembers jumping Ideal Cement trains as a child to go fishing. "The Clean Air Act says you should be doing things in the cleanest way possible. Why wouldn't the state say, well, you've already said you could do this with emitting fewer pollutants. Then you ought to do it. The spirit of the law does not say you should emit as much as you possibly can under the law. It says the exact opposite."

Burdette, who lives in nearby Wilmington with his wife and two young girls, became the riverkeeper in 2007 and has led much of the fight against Titan. One morning last month, he pulled up to the Northeast Cape Fear River, a tributary of the Cape Fear River, in a pickup truck with a "RVRKPR" license plate and toured the river with Mike Giles of the North Carolina Coastal Federation. They drove a small boat up to the proposed site of the plant and along a creek that bordered the property's limestone mine. The river and the stream were peaceful, disrupted only by the faint sound of industrial activity. Children had already begun to head back to school, but on a day in the middle of the summer, the river would have been filled with families hoping to catch some catfish to bring home for dinner.

"This plant is going to be one of the biggest in the entire country, and there are lots of people who are going to be impacted, and they really refuse to look at the health impacts here," Burdette said. "To me, how can you not look at health impacts when you issue an air permit?"

'A modern cement plant will be a large emitter'

Titan acknowledges that its proposed plant will mean large amounts of air pollutants along that river. "By its nature, a modern cement plant will be a large emitter," Titan spokeswoman McClain said. But the company is confident that its emissions will not cause adverse health impacts and that no further controls are warranted.

"The U.S. cement industry is subject to the most stringent emission standards in the world, and the Carolinas Cement plant will comply with every one of them," McClain said. "So, as consumers of cement, would we rather our cement come from the most highly regulated cement plants in the world or be imported from some developing country with marginal emissions regulations at best? It is not the intent of the state or federal government to prohibit the construction of any new large industrial plants, but to ensure that the emissions do not significantly impact air quality."

The challenge to the permit is still pending in court. In the meantime, some of the battle has moved to the local government level, where county commissioners are wrestling over zoning permit requirements.

The advocates have also fought to keep their air monitor to provide data before and after the plant is potentially built on the site, opposing the proposal in the state Legislature. The air monitor is the only means citizens have to assess the air quality, unless they pay for independent studies, said Bob Parr, an urgent care physician in New Hanover County who is among a group of physicians advocating in the state for clean air.

"If you have bad air quality because some industry cannot control its emissions, then you have no real control over that. The only real control you have now is that you can go to the air quality monitor station if there's one available to you, and you can look at it," he said. "You can say, you know, today's not a great day to jog outside. I think I'm going to use the treadmill."

Nobody laid claim to the monitoring provision, which ultimately did not make it into the final version of the 2013 regulatory reform bill; the state House stripped both it and the citizen suit provision out of the version that was sent over by the Senate, where many of the anti-regulatory measures have originated over the last couple of years.

According to a March 2014 memo from the Division of Air Quality, air toxic monitors cost about $36,000 annually on average to operate, while monitors for pollutants like fine particles cost about $10,000. The Legislature's proposal would have closed about half the state's 56 monitors. DENR Division of Air Quality spokesman Tom Mather said the provision was "problematic" partly because many of the state air monitors are considered significant by the state, including the one in Castle Hayne, but aren't explicitly required by EPA.

"These monitoring locations we have throughout the state, it's not like there's a tag on them that says 'federally required,'" Mather said. "We have to submit [a monitoring] plan every year, so the only way we would ever know whether a monitor is required is to submit a new plan proposing to close a bunch of sites and see whether the EPA would approve that or not."

Even though the proposal didn't pass, environmentalists and Castle Hayne advocates fear they haven't heard the last of it, or of other measures targeting air quality regulations. Longest of Duke University said he is worried that it and other activity in the Legislature are taking attention away from quieter changes that have taken place within the Division of Air Quality since the McCrory administration came into power. In the 2010 monitoring network plan it submitted to EPA during the Perdue administration, the division argued that it needed more monitors to get a better sense of how pollution acts in the air; in its 2013 plan, after McCrory became governor, the division asked to close a handful of monitors.

"I expect it will come back up next legislative session, and I wonder, frankly, if some of the things that are being proposed aren't really just distractions," Longest said. "Some of what I see going on here is political cover. That is, the General Assembly will ask for something that they know is incredibly provocative, and then that engages the environmental community tooth and nail, and once they're out of breath and don't have time to fight on this other piece."

The Department of Environment and Natural Resources has dramatically changed in the past couple of years under the direction of Skvarla and the Legislature. The budget is 40 percent lower than it was in the mid-2000s. There are fewer staff members, and those who remain enjoy little protection if they want to speak out against policy decisions. And a key addition to the department's mission statement by Skvarla has changed its primary focus to customer service for regulated entities.

"In its essence, DENR is a service organization," the mission statement says. "Whether managing parks and zoos or issuing permits, agency personnel, operating within the confines of the regulations, must always be a resource of valuable public assistance, rather than a bureaucratic obstacle of resistance."

The changes have mostly affected regulations over water quality, largely because the state has more leeway from the federal government in that area. Mather, who been at the Division of Air Quality through four different administrations since 1997, three of them Democratic and one Republican, defends his division. He argues that the cooperative federalism nature of air regulations -- EPA sets standards and then states come up with plans to meet them -- means that it has always been customer-service-oriented toward all stakeholders, industry and environmental alike. According to Mather, the new culture at the state Department of Environment and Natural Resources has had more of an effect in other ways.

"We've always had a strong emphasis on customer service and getting input from various stakeholders," Mather said. "It doesn't make any sense for us to adopt a rule that people have difficulty implementing or putting in place."

When reforms take hold

But there are quiet worries among environmentalists that the greater changes within the department will soon catch up to the air division and that ideology will come to replace science-based decisions. State leaders also have been increasingly vocal about their opposition to EPA's June 2014 proposal to require carbon dioxide reductions from existing power plants under the direction of Skvarla and Donald van der Vaart, a former petroleum and coal industry executive who is currently serving as energy policy adviser at the Department of Environment and Natural Resources. The state in 2013 also launched a lawsuit against EPA challenging the agency's requirements for fine particulate matter, arguing that they ignored improvements made in the state thanks to the Clean Smokestacks Act. Environmentalists have intervened in the lawsuit over objections by the state.

"I think a lot of us in the environmental community feel good about the record of our state environmental laws, and it's just incredible to see in just a short period of time the attempts to dismantle the progress we've made in the environment and public health," said June Blotnick, who has served as executive director of Clean Air Carolina for the past eight years.

They worry that when the division does its 10-year review of state rules as the state Legislature has required, it will be forced to retract any that are deemed more stringent than federal regulations. Mather said he's not sure what its effect will be.

"A good example is we have rules on open burning, and I believe most states do. The EPA doesn't have rules on outdoor burning, but these were some of the first air quality rules that the state adopted back in the early '70s," Mather said. "They've been in place for many years. There have been a number of changes made throughout the years, but, you know, that's something that clearly is not required by the federal government, but if we just got rid of those rules it would be problematic."

John Suttles, staff attorney at the Southern Environmental Law Center who works on air issues, said there has been a two-way erosion of trust between environmental groups and the department. He said environmental groups feel as if there's been a misinformation campaign aimed their way. Amid all the changes, the residents against the Titan plant say they've largely stopped bringing their complaints to the state. They've long had trouble communicating to the Division of Air Quality and political leadership their concerns about the proposed cement plant, even when Perdue was governor. Doctors, including Parr, tell tales of hostile encounters with elected and DENR officials.

"We mostly haven't really brought our concerns to the state. We did in the beginning, when Governor Perdue was here. We tried to speak with her several times," said Darrell, the local grass-roots leader. "I think at this point DENR is so understaffed."

Despite the deep partisan divide in the state, though, advocates are quick to point out that there are some Republican lawmakers on their side, including Rep. Rick Catlin of Wilmington, a former hydrologist and county commissioner.

"The Republican Party, they used to be populated with a number of people who were extremely strong on the environment and public health," Parr said. "It'd be hard to find somebody nowadays in either the state or the federal government that has the character and qualifications of Rick Catlin. I'm just amazed. That's the way it should be. It shouldn't be a political issue at all. It shouldn't be whether you're Republican or Democrat. It should be whether you're concerned and you know the science and you know public health."

At the earliest, the Titan plant would be finished in 2020, a timeline that allocates two years for the completion of an environmental impact statement and two years for construction, McClain said. The company plans to do its own continuous monitoring, as required by its permit, for SO2, NOx, particulate matter, mercury, volatile organic compounds, total hydrocarbons and CO2.

The big question is whether the sum of the changes passed and proposed in the Legislature and within DENR will ultimately lead to dirtier air for North Carolinians. Mather said the division believes the air toxics reforms will have little effect on the ground; Duke Energy Progress, the state's largest utility, also said it found through modeling that the changes wouldn't have much impact. But at the very least, under the new political regime, it will be an uphill slog to get North Carolina to jump ahead of federal regulations, such as EPA's recently proposed carbon dioxide emissions standards for power plants, as it did with passage of the historic Clean Smokestacks Act, said Smith, the former DENR assistant secretary.

"Something is going to happen, and it's better for us to shape it and do it in a way that make sense economically for the utilities," she said. "Obviously, you've got very different players involved at this point in terms of the state's political leadership, so how they would view that and whether they would be interested in facilitating that -- I have no idea."

E&E Daily editor Kurtz previews eBook examining North Carolina's changing political landscape

In a new eBook, "Turning Carolina Red: Reports From the Front of an Energy Culture War," E&E Daily and Greenwire staff uncovers the story of North Carolina's rapidly changing political landscape and its impacts on energy and environment policy. On today's The Cutting Edge, E&E Daily editor Josh Kurtz previews the book and explains how North Carolina's political story paints a picture for other regions of the country.

Click here to watch E&ETV's The Cutting Edge.

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