Oakland's Schnitzer Steel in the crosshairs of regulators

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Two weeks ago, Margaret Gordon noticed a peculiar smell in West Oakland, like burning rubber and cigarettes. When she learned a fire had broken out at the Schnitzer Steel facility, she thought, “Here we go again.”

“It was just a matter of time,” Gordon told The Oaklandside. “It was an incident waiting to happen.”

Gordon is the co-founder of the West Oakland Environmental Indicators Project (WOEIP), a group that has monitored and fought air pollution in the city’s majority Black and Latino neighborhoods next to the port since 2012. Almost since its inception, WOEIP has paid close attention to Schnitzer Steel—a scrap metal processing facility on the waterfront that is also close to daycare centers, parks, senior centers, and hospitals.

The August 9 fire that spewed a noxious plume of smoke over much of the East Bay was not the first conflagration at Schnitzer. Fires were reported in 2020, 2018, 2010, and 2009. After the 2018 fire, state inspectors found high levels of lead, copper, and zinc in burned residue. The cause of the latest fire, which occurred in a tin and light iron pile, is still under investigation. A spokesperson for Oakland Fire Department said Schnitzer workers claim these types of ignitions are typically caused by lithium-ion batteries, the kinds that are used nowadays to power electric vehicles, bikes, and scooters.

Schnitzer spokesperson Eric Potashner said the company, which recently rebranded as Radius Recycling, is reviewing its fire prevention protocols to figure out what went wrong.

Potashner said Schnitzer has already invested over $50 million in equipment to address air emissions and stormwater runoff, and will continue to improve its operations.

“Right now there’s a legitimate level of skepticism, of frustration, with our operation,” Potashner said. “We’re doing everything we can to get better.”

Regulators have repeatedly cited and fined Schnitzer for releasing toxic air emissions and other pollutants. In 2012, the Alameda County District Attorney investigated Schnitzer for releasing hazardous waste and emissions in West Oakland, including lead, cadmium and zinc. Nearly a decade later, Schnitzer agreed to pay $4.1 million to settle the multi-agency lawsuit. The settlement was seen as a major victory for West Oakland residents, who experience some of the highest levels of air pollution in the Bay Area, due to their proximity to heavy industry.

As part of the settlement, Schnitzer agreed to take proactive steps to prevent future environmental contamination of West Oakland, including conducting regular inspections around its facility to remove waste products and installing state-of-the-art air pollution equipment. In a recent report, Schnitzer touted its upgraded emissions control system in Oakland and said it is working toward a goal of 25% emissions reductions company-wide by 2025. Potashner said the company is on track to meet this milestone.

But it’s unclear whether these steps have been enough. On July 31—a week before the most recent fire—the California Attorney General warned Schnitzer that the company was potentially violating its 2021 settlement agreement by continuing to release hazardous material into West Oakland.

In a letter, the state said data reported by Schnitzer shows that light fibrous material from shredded vehicles continues to get carried in the wind out of the facility, polluting nearby neighborhoods. The state said this material contained concentrations of lead and zinc that exceeded hazardous waste thresholds, and that Schnitzer has been finding and removing this material since 2015.

“There has been no indication or data presented to the People to conclusively show that any modifications made to the facility have directly reduced the amount of (material) being released,” the letter said.

Potashner said Schnitzer has already significantly reduced the amount of light fibrous material escaping its West Oakland facility, and that the company is in the process of designing an enclosure to seal off the last remaining area where waste is getting out.

The attorney general’s letter also notes that in December 2020 the state Department of Toxic Substances Control set up two air pollution sensors near the facility. Downwind of Schnitzer, the sensors detected higher levels of metals, notably lead and zinc. Potashner said Schnitzer is partnering with regulators to collect more air data and that the company needs to fund more air monitors.

The attorney general also noted that Schnitzer is keeping large piles of “non-ferrous raw”–which can include metals like aluminum, copper, lead, nickel, tin, and zin–out in the open. Schnitzer argued in its own letter that it has plans to reduce these outdoor stockpiles by 75%. But the state said it does not understand “why Schnitzer is not completely eliminating outdoor stockpiling of (material) or why this cannot be accomplished.”

The attorney general wrote that Schnitzer must “immediately” eliminate its uncontained, open-air piles of non-ferrous raw materials.

Potashner said the company agrees on the need to build an enclosure for its outdoor stockpiles, but that it takes time to design and construct a shelter. The state letter notes that Schnitzer has had since 2015 to do this.

The Attorney General’s Office also did not respond to questions about its discussions with Schnitzer.

As Schnitzer struggles to comply with its past settlement agreement, the company must now also address a growing number of new violations.

Following the most recent fire, the Bay Area Air Quality Management District issued two notices of violation against Schnitzer for generating an illegal fire and visible emissions and causing a public nuisance. A district spokesperson said the penalty amount for these violations has not been determined as the investigation is ongoing. BAAQMD has its own settlement agreement with Schnitzer and confirmed in 2022 that the company installed additional air pollution equipment.

The Department of Toxic Substances Control has also issued violations. The department stated that Schnitzer failed to operate the facility to minimize the possibility of a fire, and that it didn’t immediately notify the state Office of Emergency Services when the fire broke out.

The California Environmental Protection Agency already has six open violations against Schnitzer that appear to have been logged in April. The agency noted that the company lacked emergency vents on gas tanks, and that small amounts of light fibrous material—also called “fluff”—were spotted near stormwater holding tanks, and in uncovered piles. The agency also found that Schnitzer was not properly managing fine metal powder produced from aluminum, zinc, and copper

Potashner said Schnitzer is working with regulators to address these issues.

“We take all of those regulatory relationships extremely seriously, and we’re working through each of them,” he said.

Councilmember Carroll Fife, whose district includes West Oakland, said she’s spoken with representatives from Schnitzer and with regulators, and is continuing to investigate what happened with the latest fire.

“I was told by people from the company that there have been no major incidents of this scale in five years because of precautions they’ve taken to prevent these kinds of fires, and then I’m hearing other things from regulatory agencies,” Fife said. “It’s not really clear to me what’s true, right now, unfortunately.”

Fife said environmental justice is a priority for her district and she’s exploring options to prevent another fire or other incident from happening again. But she said the facility also performs a necessary function for Oakland: shredding abandoned vehicles that litter city streets by the thousands. She is also skeptical about the merits of a proposal to move the facility to the old army base.

“Offering simple solutions is not being realistic,” Fife said, noting that emissions would still be able to travel from the base to other parts of West Oakland.

Potashner said the company wants to have an ongoing dialogue with West Oakland residents to regain trust. He added that may involve discussions about potential community benefits.

“We’ve been here over 50 years, and we want to be here at least another 50, if not longer,” Potashner said.

As part of the 2021 settlement with Schnitzer, the West Oakland Environmental Indicators Project received over $1.3 million to install and maintain air filtration systems at several community centers and affordable housing sites in West Oakland.

Frustrated by the latest fire, WOEIP has started mulling other potential remedies. In a press release following the most recent fire, WOEIP urged the City Attorney to bring a civil enforcement action against Schnitzer. The group pointed out that the City Attorney’s powers were expanded under an ordinance approved by the City Council in June. This could help the city penalize polluters like Schnitzer. The city attorney’s office declined to comment on the matter.

“I expect there will be a lot of push on the part of the community members, and demands for something meaningful to come out of this,” said Brian Beveridge, the co-director of WOEIP.

Stressing that she’s not anti-business, Gordon said the company needs to make drastic changes if it wants to stay in West Oakland.

“They need to either upgrade or just leave,” Gordon said.

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Eli Wolfe reports on City Hall for The Oaklandside. He was previously a senior reporter for San José Spotlight, where he had a beat covering Santa Clara County’s government and transportation. He also worked as an investigative reporter for the Pasadena-based newsroom FairWarning, where he covered labor, consumer protection and transportation issues. He started his journalism career as a freelancer based out of Berkeley. Eli’s stories have appeared in The Atlantic, NBCNews.com, Salon, the San Francisco Chronicle, and elsewhere. Eli graduated from UC Santa Cruz and grew up in San Francisco.