By on July 2, 2009

In the market for a parking lot in Flint, Michigan? Or a nine-hole golf course in New Jersey (needs TLC)? How about some scenic acreage way upstate New York that features prominently on New York State Registry of Hazardous Waste Sites and on the federal superfund list of contaminated places? All—and more—available now to the highest bidder. Come on down!

While the supposedly best of GM is sold to the supposedly new GM, the worst will be auctioned off in bankruptcy court. Call it the Adam and Eve of all foreclosure sales.

Open house in Massena, New York. This fine waterfront property, abutting the St. Regis Mohawk Indian Reservation in the east and the St. Lawrence River to the north, was home to a GM foundry. It made aluminum cylinder heads for the Chevrolet Corvair. It also mass-produced PCB sludge.

The proud buyer will become quite familiar with John Privitera, a lawyer for the Mohawk tribe at the McNamee Lochner Titus & Williams PC law firm in Albany, New York. On information and belief, John Privitera Esq. alleges that GM was “dumping hazardous waste on the banks of the river, such that the waste oozed into the water and the land. It was picked up by animals and moved up the food chain through fish and into Mohawk women — into their breast milk, into their babies.”

Cost of the site? $225 million—to clean up. That’s what GM would have to pay to detox the site and to restock the river with edible fish—if it held on to the property.

Tom Wilkinson, GM’s director of news relations, said to Bloomberg: “The old GM will be selling a lot of potentially valuable but peripheral property the company accumulated over 100 years, kind of like a big garage sale. You will see some really good real estate deals come out of this for investors and communities.”

And you’ll be paying for it. Government Motor’s environmental liabilities for all sites are estimated at $530 million. Fritz Henderson said money needed to wind down the old GM was $1.25 billion, up from an earlier estimate of $950 million, because of a reassessment of the environmental liabilities.

A bankruptcy court filing lists eleven GM sites that have contamination or “ongoing environmental compliance obligations” such as cleaning up soil, sediment, surface and groundwater and long-term monitoring, including property in Syracuse, Rochester and Buffalo.

The company plans to leave behind sixteen plants and associated real estate in Delaware, Ohio, New York, Indiana, Pennsylvania, Virginia and Michigan; an industrial park in Anderson, Indiana; a former Cadillac site in Detroit; the parking lots in Flint; offices and an employee development center in Pontiac, Michigan; and 76 acres of vacant land in Van Buren, Michigan, among other discarded property. If only the real estate market were better . . . .

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15 Comments on “GM’s Toxic Assets...”


  • avatar
    Rastus

    Bertel, with all due respect…GM can pollute the sky, the air, the skyline, the earth, and the water….

    …but nothing compares to the PCB/toxic waste/carcinogenic crap they have bestowed upon their cash-paying customers.

    The Corvair you mention is but one of many fine examples.

    Toxic garbage, in the case of GM, is not a “by product”…it is THE main output…even to this day!!

    This is how we must go about cleaning up GM:

    http://www.jewcy.com/files/crushed-cars-2.jpg

  • avatar
    venator

    Bertel, the Corvair was more of a 1960s car.

  • avatar
    PeteMoran

    Those darn capitalist Externalities!

  • avatar
    Steven Lang

    To be perfectly honest, I’m very surprised that a company as large and as industrial as GM wouldn’t have a far broader variety of waste sites over the decades.

    The amount of chemicals and hazardous materials automakers have dealt with over the decades registers well into the thousands of tons. It’s a sad reality. But the development of any industrial empire of modern times has resulted in unintended consequences as it relates to poison and human health.

    What’s the alternative? Should GM keep all the properties you mentioned and hope for the best? Should the bailout money (which is all there is at this point unless you count the impending liquidations) be spent on an industrial clean-up instead of building competitive vehicles?

    Let’s ask the really important question. Is it worth it?

    A lot of folks would prioritize jobs and financial health over an industrial clean-up and the impending lawsuits. Personally, I’d be interested to find out whether there was any true malicious intent. But I also think that the economic crisis we’re in now is far more important than righting the stupidities of 40+ years ago.

    If GM cut off it’s uncompetitive assets and kept the world class products and facilities that it already has, everyone would be far better off. Now if we’re talking about Chrysler then the idea of liquidation over reorganization is obvious to anyone other than the politicos that preside. But GM still is worth far more as a whole to our country than torn apart into dozens of little Chinese government subsidized bits.

    Wait until the Chinese decide to stop buying so much of our T-Bills… then feel free to get back to me.

  • avatar
    Rastus

    This is what we need to do to clean up GM’s “toxic assets”…and we need to do it ASAP!!

    http://www.jewcy.com/files/crushed-cars-2.jpg

  • avatar
    mistrernee

    “Should the bailout money (which is all there is at this point unless you count the impending liquidations) be spent on an industrial clean-up instead of building competitive vehicles?”

    Yes.

  • avatar

    Steven:
    Wait until the Chinese decide to stop buying so much of our T-Bills… then feel free to get back to me.

    “July 2 (Bloomberg) — China hopes that the dollar’s exchange rate will “remain stable” as the world’s international reserve currency, Vice Foreign Minister He Yafei told reporters in Beijing. It wouldn’t be unusual for Group of Eight leaders to discuss a new reserve currency at this month’s summit, He said.”

    The USD lost 1.5 cents against the EUR right after that remark (the $ recovered later.)

    A lot of folks would prioritize jobs and financial health over an industrial clean-up.

    China had done that in the past and got lambasted for it.

    You can’t paint yourself green, and at the same time walk away from the environmental sins you have committed in the not too distant past.

  • avatar
    sutski

    “Should the bailout money (which is all there is at this point unless you count the impending liquidations) be spent on an industrial clean-up instead of building competitive vehicles?”

    Yes.

  • avatar
    NickR

    “Should the bailout money (which is all there is at this point unless you count the impending liquidations) be spent on an industrial clean-up instead of building competitive vehicles?”

    What are you kidding me? Have you ever read about PCBs and their effects on the food chain in general and on human health in particular? Cleaning this crap up should be the first priority.

    Just goes to show that environmentalists are right…preempting environmental pollution is a damn sight cheaper than ignoring it and leaving the clean up for down the road.

    That being said, the environment is an excellent reason for many Western nations to close the door on Chinese crap (which they should). Regrettably, they have us by the financial short and curlies now, so that could be tough.

  • avatar

    The cost of cleaning-up polluted industrial sites is enormous. GM has hundreds of them. I don’t think these numbers are right. At all.

    So . . . does New GM walk away from the legal obligation to clean them up, even if they’re NOT sold?

  • avatar
    johnny ro

    St Lawrence Seaway from Lake Ontario to Vermont was beautiful country when I drove it 10 years ago.

    I remember what is a large town for the area- Messina – and seeing evidence of former prosperity, but activity was comprised of lots of poor looking people hustling into and out of Walmart parking lot in their rusty cars and trucks. Crumbling older buildings in a recognizeable village remnant arrangement either vacant or underutilized. I am sure its worse today, with recent dairy industry collapse, and both GM and Alcoa (hydropower fed smelter) closing.

    Yes, GM has other many disaster sites, of their own creation, like other manufacturing companies. I remember one in Syracuse, a large facility, standing empty, high chain link fence around huge empty parking field, GM kept it “open” after production ended, meaning closed and dark and fenced and guarded but not officially closed, because to officially close it triggers cleanup.

    They said its better for today’s profits to let later generation clean up today’s mess. Or not clean it up, its their problem, right? They did not say this in press release though.

  • avatar
    jpcavanaugh

    I would be very surprised if GM gets out from under this. Even if old GM goes out without enough money to pay the environmental claim, New GM will likely be liable as a company that is, essentially, a continuation of the same operation.

    In Indiana, we recently had a case where a company is being held responsible for environmental contamination at the old Studebaker factory, that is only now being torn down. Although Studebaker stopped building cars at the site in 1963, the successor to the corporation that was set up to continue all of Studebaker’s other businesses is being held responsible for the cleanup. GM is not going to get out from under this by changing corporate forms and then staying in the carbuilding business.

  • avatar
    npbheights

    And you’ll be paying for it. Government Motor’s environmental liabilities for all sites are estimated at $530 million. Fritz Henderson said money needed to wind down the old GM was $1.25 billion, up from an earlier estimate of $950 million, because of a reassessment of the environmental liabilities.

    After the $20,000,000,000.00 the US government gave GM the last six months that they used for God knows what, doesn’t an extra one or two billion seem really cheap to fix all of the environmental disasters GM has created over the past 100 years? At least it seems like a lot better use of government money. Look at all the jobs GM created by polluting the environment!

  • avatar
    NickR

    Look at all the jobs GM created by polluting the environment!

    Exactly, talk about job creation. The companies that make hazmat suits will throw ‘er in high gear, unused excavators and dump trucks can be used to move this stuff…somewhere. And loads of people doing the testing, digging, shipping and everything else required for environmental remediation. It will keep thousands employed for years to come. May as well.

  • avatar
    Captain Tungsten

    GM has reclaimed many of it’s old industrial sites, examples include the Centerpoint site in Pontiac, which was originally a truck assembly plant, the site of the Pontiac foundry on which a U.S. Postal Service processing facility stands, the powertrain plant in Flint which had to be remediated before the new I-6/I-5 plant could be built. There are other examples as well.

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