The Boeing Co. will pay the city of Santa Monica $39.5 million over the course of 10 years to settle claims that McDonnell Douglas Aircraft contaminated the local water supply when it housed some manufacturing operations on Exposition Boulevard in the 1940s-70s.
The City Council unanimously approved the terms of the settlement Tuesday night, after more than three decades of research to find the sources of a trichloroethylene leak into two of its drinking-water wells. The city's approval is contingent upon the Los Angeles Regional Water Quality Control Board issuing to Boeing a cleanup and abatement order.
"This one is a big deal,” City Attorney Marsha Jones Moutrie said of the settlement.
The maker of commercial and military aircraft, Douglas Aircraft was headquartered in St. Louis before it merged with Boeing in 1997.
Assistant City Attorney Joseph Lawrence said Boeing will pay the first $150,000 within the first 30 days after the settlement is executed.
"The city has agreed to treat the Olympic drinking water to appropriate regulatory standards," and Boeing "makes no admission of liability," he said.
At the request of City Manager Rod Gould, the City Council agreed to set aside the money while staffers assess whether they'll need to build a reclamation plant to treat the contaminated water.
"Although this is a spectacular sum of money ... it can be spectacularly expensive to treat water so that the water is drinkable," said Councilman Bobby Shriver.
For more than 50 years, the Olympic well field, at the median of Olympic Boulevard on the east side of Santa Monica, has been contaminated by solvents released into the groundwater from various manufacturing and commercial businesses located in the area near Olympic and 26th Street.
Trichloroethylene, according to the Centers for Disease Prevention and Control, is a solvent used mainly to remove grease from metal parts. If ingested, it can cause liver and lung damage, coma and possibly death.
The Olympic well field is one of three that feed Santa Monica's water treatment plant. In October 1996, the Environmental Protection Agency had the Douglas Aircraft facility site between Centinela Avenue and Steward Street inspected for the toxin.
In a separate case, that same year, the city learned that two of its other drinking-water well fields, Charnock and Arcadia, were contaminated with high levels of a gasoline additive, methyl tertiary butyl ether. It was considered to be the first major water contamination to bring public attention to MTBE and led to settlements just shy of $300 million.
The Boeing settlement was modeled after an agreement the city reached with the Gillette Corp. and its parent company, Procter & Gamble Co., two years ago for $68 million, Lawrence said.
The Gillette dispute also arose out of contamination in the Olympic well field. In the 1950s, Paper Mate operated a pen and ink manufacturing plant along Olympic Boulevard. The plant used various chemicals and solvents, some of which reportedly found their way into the soil and then into the aquifer below. Gillette eventually bought Paper Mate, then Procter & Gamble Co. bought Gillette.
Under the settlement agreement, Gillette also agreed to clean up the contaminated soil at the old Paper Mate site.