Southeastern Connecticut legislators who put $1.75 million for dredging operations in a State Bond Commission request to give to Cross Sound Ferry Services may have had the best intentions — aiding a New London company that brings hundreds of thousands of people into the region each year and provides many jobs. But the average taxpayer will see the gesture as absurd on its face given the fact that Thames Shipyard & Repair Co., another firm owned by the John P. Wronowski family, owes the Department of Environmental Protection $600,000 in fines for pollution and other environmental violations.

The explanations given by state Sen. Andrea Stillman, a Waterford Democrat, and state Rep. Edward Moukawsher, a Groton Democrat, make sense about trying to help a major local employer that was facing competition from Derektor Shipyards, of Bridgeport. The Bridgeport company got about $20 million in state and federal money. But the more pertinent issue is, why would the legislators propose the money for Cross Sound when the state fines were still hanging over Thames Shipyard's head? Common sense should have cautioned them to wait until Thames Shipyard paid the fines and settled with the DEP.

Sen. Stillman contends the state likely would not give Cross Sound Ferry the $1.75 million unless the firm had settled its financial obligations and met the fine and other requirements imposed by the state Department of Environmental Protection. Cross Sound would get the $1.75 million and perform its own dredging operation.

“The Wronowskis know very well they don't expect any money until they're given a clean bill of health from the DEP,” Sen. Stillman said.

The timing unfortunately makes it appear to the public that the legislators are rewarding a polluter. And the deal also does not look good because the Wronowskis and Cross Sound Ferry have contributed to political campaigns for Sen. Stillman and for a campaign ad book for Rep. Moukawsher.

Sen. Stillman and Rep. Moukawsher acknowledged the donations from the Wronowskis and their company in conversations with The Day's Editorial Page.

Sen. Stillman said the Wronowski-operated ferry company provided her with ferry services for a political fund-raiser she staged on board the boat. She says she can't remember which political campaign it was (she was formerly a state representative), but the company's donation of the ferry use was an in-kind service allowed by state law. In other words, her campaign did not have to pay for the ferry ride.

“I wasn't the only one,” she said. Sen. Stillman said the firm has provided ferry rides for other state politicians in both parties who held fund-raisers aboard the boat.

Sen. Stillman also said an employee of the ferry company had contributed to her campaign. Campaign contribution records show that Adam Wronowski and Susan A. Wronowski have given money to Sen. Stillman for at least one of her campaigns.

New London — At the same time the state is trying to collect more than $600,000 in fines from the Thames Shipyard & Repair Co. for violating environmental laws, local legislators have proposed giving the company's owners $1.75 million for dredging and repairs.

The proposal was part of a massive bill passed in a special legislative session last month that would authorize $380 million in general-obligation bonds for fiscal year 2006 and $423 million in fiscal year 2007.  The $1.75 million is earmarked for Cross Sound Ferry Services Inc., one of four companies, including the shipyard, owned by the John P. Wronowski family. The other two companies are Thames Towboat Co. Inc. and Thames Dredge & Dock Co., raising the possibility the Wronowskis could use the money to pay themselves to do the work.

For the past seven years, the state Department of Environmental Protection has been negotiating a consent order with Thames Shipyard that would require it to pay the fines and spend hundreds of thousands more to clean up pollution at the shipyard.  The DEP has charged that over a decade the company illegally stored and disposed of hazardous wastes, polluted the Thames River and constructed piers and other structures without permits.

But state Sen. Andrea Stillman, D-Waterford, co-chairwoman of the legislature's Environment Committee, said Wednesday that she and the other members of the local delegation endorsed the $1.75 million in bonding at the request of the shipyard for a number of reasons.

“I think in the course of a year they transport more than a million people,” she said. “They're a very successful business, which is a great asset to our region.”  Moreover, she said, the company has been placed at a disadvantage by the state itself, which has spent “more than $20 million” since 2000 to build a new shipyard in Bridgeport, Derecktor Shipyards Conn. LLC, which has become a source of competition.

“It was my understanding the Bridgeport shipyard was not going to compete, that they were going to do a different kind of work,” Stillman said. “But lo and behold, they do compete, so it is one way to level the playing field and to help what has been a very responsible taxpayer to New London and a great asset to the region.”

“The argument for it was it's unfair to be putting them at a competitive disadvantage,” said state Rep. Ted Moukawsher, D-Groton. “The dredging will allow them to work on larger ships.”

Both Stillman and Moukawsher said they had had some misgivings about the state's potential largesse, but supported the proposal in the end, because “frankly it doesn't seem fair to make them compete privately with a state-subsidized shipyard,” Moukawsher said.

“Frankly, I had some misgivings about how it would look,” he said. “On the one hand, the state is going to fine them for these violations, but my understanding is that a lot of them relate back to activities that took place over a long period of time. ... It's an old shipyard. There are structures there that have been there a long time.”

Stillman said that the state's awarding the money would be contingent on how the company resolved its problems with the DEP.

“Certainly until things are settled with the DEP, the DEP isn't going to sign off on giving the shipyard money from the state,” Stillman said. “One thing has to be resolved first before we can move on to the next.”

Ross Q. Bunnell, who is heading up the enforcement action for the DEP, said last week his agency and the company seem to be close to a final agreement on the consent order.  Adam C. Wronowski, vice president of Thames Shipyard, could not be reached to comment Wednesday.  Even if the DEP arrives at an agreement with the company, approval of the funding proposal is by no means a foregone conclusion.

“The fact that something made it into an authorization does not mean it will be approved,” said Robert L. Genuario, secretary of the state Office of Policy and Management. “It will be weighed against other meritorious projects ... It's premature to suggest that this will or will not be actually funded.”

The OPM makes recommendations to the governor as to which items the governor may wish to put onto the State Bond Commission agenda, he said. “We would seek input from the DEP before making a recommendation.”

State Rep. Robert T. Keeley Jr., D-Bridgeport, co-chairman of the Finance, Revenue and Bonding Committee, said he would be investigating the request because “it was presented as a need that New London had ... but nobody brought us up on any kind of past problems whatsoever.”

Keeley, who sits on the bond commission, and is in a position to make recommendations on specific projects, held out some hope that the proposal may be approved.

“If we can help a deep water port, we're going to help a deep water port,” he said. “I spoke with legislators up there, and they're all behind the concept. The bottom line is it's in the process right now.”

But ultimately the final decision rests with the governor.  Dennis Shain, director of communications for Gov. M. Jodi Rell, did not return calls for comment Wednesday.

By KENTON ROBINSON
Day Staff Columnist, Enterprise Reporter/Columnist
Published on 6/5/2005

New London — The Thames Shipyard & Repair Company is facing fines of more than half a million dollars for violating environmental laws more than two dozen times over the course of more than a decade.

The state Department of Environmental Protection is charging the company with the illegal storage and disposal of hazardous wastes, pollution of the Thames River, and construction of piers and other structures without permits, all from 1985 to 1998.

For the past seven years the DEP's bureaus of waste and water management have been trying to come to terms with the company on a consent order that would require the company to pay the state $534,457 and to investigate and, if necessary, clean up 13 “areas of concern” at its Farnsworth and Ferry street sites.

The company's potential liability extends further.

The shipyard is the target of a separate consent order from the DEP's Office of Long Island Sound Programs, which is seeking a penalty of $100,000 for failing to get permits for “a number of piers and docking structures” it has built since 1980.

The office is also asking the shipyard to remove several derelict structures, such as sunken barges and dilapidated docks.

Company officials say they already have spent hundreds of thousands of dollars to correct violations discovered in May 1998 by DEP inspectors, and they expect to spend hundreds of thousands more.

“The money we've spent on professional fees, consultants and work we've done in the shipyard is in the mid-six-figures range,” said company Vice President Adam C. Wronowski. “As far as gross revenues go, we're more than a million, but we're not a $10 million company... so in that very big ballpark, $500,000 is a very big number.”

But they also hope to be able to come to an agreement with the DEP that would reduce to total amount of the fines, Wronowski said Friday.

“The fines are negotiable,” he said, “and there are terms as to how the payments can be made. Also, I believe the DEP has a financial program where they calculate a company's ability to pay. So that is not a fixed number at this point. It's still being negotiated.”

However, Ross Bunnell, the senior sanitary engineer for the Bureau of Waste Management who's been heading up the investigation, says the fines are based on a number of factors prescribed by law, including the gravity of the violations, the fact that the violations were continuous over a long period of time and the economic benefits the company derived by failing to comply with the law.

While there might be a possibility of adjusting the final numbers, he said, “It's not like a flea market where you're haggling over a blender.”

When DEP inspectors visited the shipyard in 1998, it was the first time the agency had inspected the yard in more than 10 years. But many of their findings reflected those of inspectors who visited the shipyard in 1983 and 1985.

In both of those earlier visits, the DEP cited the shipyard for violations of the state's hazardous waste regulations, including the illegal storage of waste oil on the site. In both cases, shipyard President John P. Wronowski promised to correct the violations.

“We assure you that in the future no waste oil will be stored on the site,” he wrote the DEP on April 26, 1983.

When the inspectors returned in 1998, they found more than 30 violations of state and federal laws, including waste oil storage.

Among the cited violations:

•Thames Shipyard treated, stored, disposed of and transported hazardous waste, including waste oil, paint and solvents, through the state without getting the required federal Environmental Protection Agency identification number and the required permit from the DEP.

• The company failed to determine which waste was hazardous and label it, failed to transfer waste out of leaking containers and failed to close containers.

• The company failed to keep manifests to document proper disposal of hazardous wastes and failed to prepare and submit biennial reports to the DEP. The company failed to conduct and keep logs of hazardous waste inspections and did not train employees in the handling of hazardous wastes.

•The company failed to have a contingency plan for emergencies and equip the shipyard with required safety equipment.

The DEP cited the shipyard for the discharge of wastewater and unpermitted substances, such as paint, waste oil and used blasting grit, into the river. Also, the DEP charged, the shipyard failed to develop a storm water pollution prevention plan or to monitor storm water discharge that could carry contaminants into the river.

While admitting that the shipyard was in violation of environmental laws, Adam Wronowski defends the company, arguing that he was unaware of many of the laws before the DEP inspectors arrived and that most of the violations did not result in pollution to the river.

“Since '98 we have made extensive changes up there,” Wronowski said. “Number one, it's been an educational process. A lot of the possible violations were things that we didn't know about.

“Number two, a lot of the violations were — while we agree they are serious and we take them very seriously — they were record-keeping violations and submittal of records, records retention and that sort of thing, as opposed to direct pollution.”

Wronowski declined a request to tour the site because of the pending consent orders.

Company and DEP officials met at the end of May to put the finishing touches on both consent orders, which are agreements in which the company promises to correct violations and abide by the law. The company is facing fines totaling more than $630,000. Also, the company must do a “scope of study,” which will provide for the scientific determination of what pollutants are in the soil and what must be done to clean them up.

Bunnell said he expects an agreement within the next few weeks.

“We didn't set a firm date, but it was understood that we were talking about a matter of weeks — not a matter of months — before we get to a final yea or nay,” he said. “We're expecting to get to a decision point — take it or leave it — and if you leave it, we'll just send it over to the attorney general's office and go the court route.”

•••

During the 25 years the Wronowski family has owned it, the Thames Shipyard has become a major player in meeting the transportation needs of the region, servicing approximately 30 ferries and a number of tugs and other boats, Wronowski said.

The Wronowski family also owns the Cross Sound Ferry Company in New London, which has service to Long Island. They also run a ferry service to Block Island.

The Thames Shipyard includes the company's offices off Ferry Street in downtown New London, but most of its 67 workers are employed at a sprawl of docks and buildings on a six-to-seven-acre spit of land off of Farnsworth Street near the U.S. Coast Guard Academy.

“We service all of the Martha's Vineyard and Nantucket ferries. We service all of the Fishers Island ferries. We service all of the Bridgeport-Port Jefferson ferries. We service the Connecticut River ferry Selden, and of course we service all of the Cross Sound ferries, and the Block Island ferries,” Wronowski said.

Until the opening of Derecktor Shipyards Conn., LLC, in Bridgeport in August 2000, theirs was the only commercial shipyard operating in the state.

That, say DEP officials, is one reason the case has taken seven years to resolve: For inspectors “this was the first time they've had to tackle these issues,” said Bunnell.

There have been difficult technical questions, he said, such as how to prevent sand blast grit from going into the water when blasting is done in a drydock.

The company has been fairly cooperative, Bunnell said, pointing out that it has already cleaned up barrels of waste oil, paint and solvent, and has taken steps to prevent spent blasting grit from falling into the Thames.

“They had a plan before we had really pursued formal enforcement action,” said Bunnell. “They responded very quickly and have been forthcoming with requested information and with documents and plans.

“More importantly, perhaps, when we said under our current policy the violations merited a penalty and we would be seeking a penalty, they said, ‘We understand that, and we're willing to pay a penalty,' ” Bunnell said. “They even consented to the concept of site-wide cleanup at both sites. Most people fight that tooth and nail, because it can be quite costly.”

Robert Lorentson, a senior sanitary engineer in the water bureau, agreed with Bunnell that the company has been cooperative.

“They have been enacting improvements that they need to make,” he said. “They've indicated from the outset that they wanted to work with us to avoid an action like a referral to the Attorney General's office.”

Kevin Zawoy, the senior environmental engineer with the Office of Long Island Sound Programs, has a different view.

“We had a consent order that went out years ago. We revised another consent order in January of 2002,” he said. “There was some reduction of penalties. There was some modification of violations. We still failed to get a signature on the consent order.”

•••

Correspondence in the DEP's files shows that on the two occasions inspectors visited the site in the 1980s, they found the shipyard in violation of environmental laws. On both occasions, John Wronowski wrote the DEP, promising to abide by those laws.

In 1985, the state cited the shipyard for many of the same violations the shipyard is being cited for today: failure to label hazardous waste, failure to inspect and keep a log of inspections of the shipyard, failure to produce records to prove shipyard workers had been trained in the handling of hazardous waste, failure to have developed a contingency plan for emergencies, failure to keep manifests proving hazardous wastes have been properly disposed of, and failure to properly manage containers and a waste storage tank.

The DEP did not return to the shipyard for nearly a dozen years because the amount of pollutants found on those inspections was relatively small.

By 1998, however, the shipyard business had grown considerably, and as a result it was producing much more waste. State officials say that, because the shipyard did not seek permits for most of the new construction and no manifests were being filed to indicate the shipyard was generating more hazardous waste, inspectors were not alerted to its growth.

As far as DEP inspectors were concerned, said Bunnell, the company had been visited in the 1980s, apprised of the laws and cleaned up.

“There was a big gap,” said Bunnell. “Once they cleaned things up, they were going to be off our radar screen.”

And because the shipyard transported and disposed of hazardous wastes without getting the proper permits, the DEP was not alerted that there might be a problem.

“The 1980s were the early days of the hazardous waste laws, and we were encountering a lot of sites where people didn't know the rules,” said Bunnell. “Generally, people who got notified of violations learned a lesson and kept clean thereafter, but in this case something happened ... ”

On May 19, 1998, David Stokes of the DEP's Bureau of Waste Management paid a visit to the Farnsworth site of the shipyard.

What Stokes found there shocked him.

“I inspected,” Stokes wrote in an interdepartmental memo, “and noted complete lack of waste management.” Ultimately, Stokes would find more than 400 “containers of waste oil, paint, thinners open, some spilling to soil, others overflowing with rain water.”

There was more.

“Site is comprised of soil which slopes to river,” Stokes wrote. “Soil staining noted throughout the site. Spent grit blast noted along river bank. Painting and grit blast takes place on boats in the river and on floating dry docks. No evidence of controls to prevent releases to the river.”

What Stokes referred to as “grit blast” was the “Black Beauty” abrasive used to blast the paint off the hulls of ships being worked on in the yard.

This was a concern because the paint used on the hulls often is lead-based, meaning the dust and spent grit produced by sandblasting could contain harmful levels of lead that could leach into the soil and water.

Subsequent testing of the spent blast grit from several sites in the shipyard has shown it falls below the level of contamination that would make it a hazardous waste under environmental laws.

On the morning of May 26, Stokes returned, accompanied by other DEP inspectors. That afternoon, environmental analyst Rita Langan also visited and reported that the shipyard was polluting the river.

“Evidence of pollutant discharge was observed from the floating dry docks, vessels and the wooden dock to which the ferry was tied,” Langan wrote.

She expressed concerns about blasting grit spilling into the water and reported that Adam Wronowski admitted “that the material spills ... into the water.”

Langan noted that there were large accumulations of the grit on the dry docks that would wash into the river with rain because “blasting occurs for days or weeks at a time with blasting waste not removed until the end of the job.”

She also noted that the soil approximately three feet from the river was stained with spilled oil and that the discharge of water from a barge and drydock could pollute the river.

On August 17, 1998, Stokes submitted an 11-page report of his findings:

“There were hundreds of paint and oil containers throughout the shipyard ... Some were full. However, the majority were only partially full,” he wrote.

“Numerous locations on the site show evidence of contamination from spilled and sloppy handling,” he wrote.

Bruce McCutcheon, Stokes was told, was the shipyard employee in charge of determining whether the waste was hazardous and hiring a contractor to haul it away.

Stokes sought to speak to McCutcheon, but McCutcheon, he reported, was never available to talk to him. Also, he wrote, “there was no documentation available for Bruce McCutcheon's training.”

Stokes noted there were open containers all over the yard, “none of which are marked, labeled or dated. All the containers were stored on the soil without secondary containment or an impervious base. Some rainwater was spilling out of the containers, and some containers were spilling waste paint to the soil.”

Altogether, Stokes counted 420 containers of waste, including 55-gallon drums and 1-gallon paint cans.

•••

Since Stokes filed his report, the Thames Shipyard has made many changes in its operations to prevent pollution of the soil and water, company and DEP officials say.

The company has taken steps to prevent the spent sandblast grit from falling into the water, including the installation of a tarp at the end of the drydock to contain it. Also, the company has cleaned up the cans of waste oil and paint, Bunnell said, using an approved waste hauler and filing the proper reports.

The biggest bone of contention has been the extent of the so-called “scope of study” the shipyard must undertake to determine how polluted different areas have become and what steps it must take to clean them up.

Because the Farnsworth Street site has been a shipyard for more than 100 years, there is pollution in the soil dating back to the days before there were environmental regulations, Adam Wronowski said.

“It's an over 100-year-old shipyard,” he said. “So you can probably imagine some of the stuff that may be in the ground up there. That's a big concern of ours. We don't feel that we've contributed anything to that.”

DEP officials say the list of “areas of concern” has been narrowed to focus on those places most likely polluted by the current owners.

No one with either the DEP or the company can estimate what the cost of remediation may be, because, as Wronowski puts it, “you don't know what you'll find until you get in there.”

Whatever the cost, he said, the shipyard will survive.

“We've got the location, and we've got an excellent reputation for the work we do. So it's important that we stay running, and we're going to do everything we can to stay running,” Wronowski said.

“We're not throwing the towel in for sure. You're talking to somebody whose got two generations behind him, and this isn't going to cause us to fold. We might have to be creative. For sure, it's a concern, but we're going to make it work.”