Last week the Exide battery company, owner of the now defunct Frisco lead smelter, hired a financial "restructuring" specialist firm by the name of Lazard, although the media coverage that followed the move suggested the more apt moniker could be Lazarus.
"Exide Technologies has been in the midst of a turnaround for awhile now and, like a car stuck in a snowbank, it hasn't been able to gain traction. Yesterday's price action on its stock suggests the market thinks it's going to end up in the ditch."
The news came on the same day the Los Angeles-based law firm of Glancy, Binkow & Goldberg said it would look into claims on behalf of Exide stockholders about possible violations of federal securities laws. Specifically, the firm’s investigation concerns allegations Exide issued misleading statements or failed to disclose material adverse facts concerning the company’s operations.
Nationwide, the company has been pulling back, selling off assets and closing plants. At last count, it had one operating smelter left in the US, and Exide just received noticed from the State of California that it will have to significantly reduce its pollution or it will be forced to close for causing a cancer hazard.
Meanwhile, the company is in the middle of a forced withdrawal from its Frisco smelter site, removing most buildings and surface structures, but leaving millions of pounds of lead contaminated smelter waste behind in a variety of landfills and dumps. It got some needed cash when the City of Frisco purchased surrounding acreage that was never the site of any production, but Exide is retaining ownership of the core smelter site – the very most toxic part.
Besides begging the question of whether this is the kind of company you want owning 100 toxic acres in the middle of your town – what happens if Exide doesn't own it? If the company goes bankrupt, who's responsible for insuring a thorough clean-up of the site, or doing anything else with it…ever?
You have to ask yourself if you were buying Exide's assets, would you really want a former smelter site with no smelter and lots of potential clean-up problems? On the other hand, the only path toward redevelopment of any kind hinges on the location of the land being in one of the region's hottest markets, so maybe a buyer that could invest in a clean-up could see some return from exploiting its proximity to everything else in Frisco.
If there's no buyers for Exide, the party of last resort is you the taxpayer via the EPA's Superfund Program. But that only guarantees you a spot on a waiting list. It could be left abandoned and toxic for decades after it's been officially listed.
You only have to look at Exide's former Dixie Smelter site in South Dallas to get an idea of what's in store for Frisco if the company is left to its own devices. Chain link fencing, warning signs, and a ring of groundwater monitoring wells surrounding a blank slate of land.
Which is to say that the City of Frisco has a spectacular self-interest in seeing that this entire smelter site gets the most protective, and most economically-desirable, clean-up that can be won. And so frustrating that the City signed over its rights to intervene in the formal closure permitting process.
If Frisco residents want a more pro-active role in insuring a proper and protective clean-up of a potential Superfund Site directly upstream from the City's proposed Grand Park, they're going to have to find a way for themselves or the City to act in self-defense on some other front besides the regulated closure process. Otherwise, they're just going to be helpless spectators to the last thing manufactured at the Exide site: a permanent toxic no-man's land.
