Herky Jerk

Doe Run's owner has done this before -- and that has regulators braced for trouble

Although Doe Run officials haven't uttered the word "bankruptcy" yet, company officials are talking to regulators about their bleeding balance sheet -- an implied warning that regulators shouldn't press them too hard about paying for the cleanup.

How successful is such whining about the bottom line? Just last week, the company finally wrested approval from the U.S. Forest Service to conduct exploratory drilling for lead in Missouri's Mark Twain National Forest. Mosby concedes Doe Run's financial health "is a major consideration" for regulators.

"They haven't made bankruptcy noises, but they've talked to us about the serious state of their financial affairs," says Mosby. "I know EPA has done some tracking of the reality of their finances."

If Doe Run does wind up in bankruptcy court, regulators will have to scramble to identify the cost of the cleanup and get in line with the rest of the creditors, including hundreds of Herculaneum residents and former workers who are battling the company in court.

Already designated a Superfund site, the smelter has also been the subject of a recent push by Gov. Bob Holden and U.S. Rep. Dick Gephardt (D-3rd District) for a spot on the EPA's National Priorities List. This would allow federal regulators to tap a pool of federal money to clean up the Doe Run mess.

But the list of NPL projects already is long, and "the federal funds aren't in the best of shape, either," Mosby says.


Another Ira Rennert company is one of the reasons the feds may be hard-pressed.

Near Salt Lake City, in the shadow of the 2002 Winter Olympics, the world's third-largest magnesium-producing company has been fouling Utah's air for years. Magnesium Corporation of America, a.k.a. MagCorp, acquired by Rennert's Renco Metals Inc. in 1989, spews out enough chlorine to qualify as the nation's No. 1 emitter of toxic pollution.

In January 2001, the U.S. Department of Justice sued MagCorp, Renco Metals and Rennert, accusing them of illegally handling hazardous waste near the Great Salt Lake. The Justice Department also moved to add new defendants, including Rennert, to a lawsuit that accuses MagCorp of illegally taking minerals from federal land. In the petition, the U.S. alleged that because of "various financial transactions" among Rennert-controlled companies, MagCorp may have been stripped of sufficient assets to pay any legal judgments.

Sure enough, the company filed for bankruptcy protection in August.

The Justice Department's lawsuit came just four days before George W. Bush took office. Was it payback for annoying the Clinton White House? Just the year before, the publicity-shy Rennert emerged as the biggest of the big-money backers of New York Mayor Rudy Giuliani's Senate campaign. Rennert's Renco Group gave $100,000 to a Giuliani committee.

That got Democratic candidate Hillary Rodham Clinton's attention. She slammed Giuliani for taking money from "the biggest polluter in America." Health problems, not embarrassment, forced Giuliani out of the race Clinton eventually won.

A look at Federal Election Commission records shows that Rennert tilts toward Republicans: For example, he gave $25,000 to the National Republican Senatorial Committee last year. But he's also propped up key Democrats, including U.S. Sen. Joe Lieberman (D-Conn.), Al Gore's running mate in 2000. Rennert's political giving crosses the Atlantic -- the Jerusalem Post describes the 67-year-old Brooklyn native as a major financial backer of right-wing Israeli politicians, including former Likud prime minister Benjamin Netanyahu, and Orthodox Jewish causes.

Since Rennert began making real-estate deals in the 1960s, he has amassed more than a dozen companies. Today, combined revenues for his businesses easily exceed $2.2 billion -- more than one-third from Doe Run. In addition to MagCorp, Doe Run and Lodestar, Rennert's miniempire includes WCI Steel Inc. of Warren, Ohio; AM General Corp. of South Bend, Ind.; and UNARCO Material Handling of Springfield, Tenn. Thanks to AM General, which makes the all-terrain Hummer and Humvee vehicles for military and civilian use, and UNARCO, which makes storage systems, Rennert's Renco Group ranks among the nation's top 50 defense contractors.

Rennert, whose New York office didn't return our calls, built his empire quietly -- very quietly, if you happen to be a reader of the Post-Dispatch, which has named the man who controls Doe Run just twice in the past two years.

Not until the late 1990s did the billionaire blow in from obscurity. And the glare of negative publicity didn't come from his ownership of troubled and troublesome businesses. Instead, Rennert and his wife, Ingeborg, hit the headlines after their plans to build a 110,000-square-foot residence in the Hamptons on New York's Long Island became public.

If completed according to plans, the residence will have 25 bedrooms, 39 bathrooms and a garage for more than 100 vehicles. That would make it the largest private home in the United States -- more than twice the size of software billionaire Bill Gates' compound in Medina, Wash.

Rennert's residence, cracks a lawyer who is suing Doe Run, will be big enough to shelter one-fourth of Herculaneum's residents:

"But they wouldn't like living on Long Island."

« Previous Page
 |
 
1
 
2
 
All
 
My Voice Nation Help
0 comments
Sort: Newest | Oldest
 
Loading...