GRAND RAPIDS — The Local Area Watch (LAW) has amended the intent-to-sue notice it filed with the state in April by adding Old Kent Bank, now Fifth Third Bank, to its complaint.
The notice sent to the Department of Environmental Quality (DEQ) and the Attorney General charges that contaminated soil was illegally removed from the Berkey & Gay Building site at 940 Monroe Ave. NW, and that much of the dirt was taken to the former Monroe Avenue Water Filtration Plant at 1430 Monroe Ave. NW.
A local Fifth Third spokesperson denied that the bank had any knowledge of, or connection to, any possible illegal activity that may have taken place at the building site.
LAW included Old Kent because the loan the bank made for the Berkey & Gay renovation reportedly required the developers to clean up part of the site. LAW said that demand led to the illegal removal of tainted soil from the property, a claim the organization based on deposition testimony given by Pioneer Inc. President Thomas Beckering, a partner in the project.
“We included the bank because of the discrepancies between the BEA filed with the DEQ, which said there would be no earth work done under the B&G Building, and Old Kent’s demand that Beckering remove all contamination from the site before they would fund [the project],” said William Tingley III, executive director and founder of LAW.
“Beckering stated that Old Kent wanted it clean before they would fund him the $25 million that was committed to him. So he did it,” added Tingley.
Fifth Third Corporate Communications Officer Peggy Janei said she wasn’t certain whether that clause was or wasn’t part of the loan agreement, as the bank traditionally keeps the detailed contents of such an agreement confidential. But Janei did say that the bank was comfortable with the agreement it made with the Berkey & Gay development companies, 900 Monroe LLC and 940 Monroe LLC.
“When we put together a package like that, it’s something that we stand behind. We’re very comfortable with the decisions that we have made,” she said. “Whatever role Old Kent played in this whole development process, we are very comfortable with it and we stand behind our decision.”
If a cleanup of the site was part of the loan agreement, Janei said the bank certainly wouldn’t encourage developers to take any illegal action to accomplish that.
“We require our customers to comply with environmental standards, but we definitely do not specify how those environmental issues should be addressed. That is standard practice in the banking industry,” she said.
“As a bank, when we get into an agreement, we require that the customers comply with the environmental standards, and that they carry out the due-care plan as specified in the baseline environmental assessment,” added Janei.
The financial transaction was completed before the two banks finalized their merger.
The due-care plan was done by Superior Environmental Corp. of Marne in March 2000. In the report, Superior noted “existing soil should not be transported away from the subject property, or to other areas not similarly contaminated, without prior characterization and selection of a suitable receiving location, consistent with provisions of Part 201.” Part 201 is the state law that regulates environmental cleanups.
LAW also added Superior Environmental to its notice, along with about 30 other potential defendants, many of whom are affiliated with the organizations already named.
In April, LAW accused Pioneer Inc., Helms Caulking Inc., Dykema Excavators Inc., Spectrum Health and the City of Grand Rapids of having roles in the alleged transfer of an estimated 14,400 tons of soil and groundwater, with much of it going to the filtration plant that is owned by Dykema. If true, the action would be a violation of federal and state environmental laws.
Pioneer, Helms and Dykema are developers and contractors of the Berkey & Gay project. Pioneer officials said about a half-dozen truckloads of soil was inadvertently removed from the property and taken to the former filtration plant. But they added the dirt was returned to the Berkey & Gay site as soon as the mistake was realized.
The Environmental Response Division of the DEQ cleared the developers of any wrongdoing in March. That investigation rose from a separate charge made by Proto Cam Inc., an auto parts manufacturer managed by Tingley and located at 1009 Ottawa Ave. NW, near the site in question.
LAW alleged that Spectrum Health was part of the deal to finance the renovation of the building, and charged that the city knew the dirt would be taken to the filtration plant after it sold the property to Dykema.
Spectrum Health has categorically denied any involvement in the action, while the city did not respond to the allegation when contacted by the Business Journal.
Tingley said LAW has several thousand hours’ of continuous videotape that shows the soil, which reportedly contains more than a dozen contaminants, being removed from the site over a period of months. The Office of Criminal Investigation, a division of the DEQ, is investigating the complaint.