Pam Nieberg (November 2004)

Back in 2002, Peter Albers, owner/operator of the nearly 4000-cow Heritage Dairy near Dixon, was the beneficiary of a state program that provides tax-exempt, low interest loans to small businesses to help fight pollution. The California Pollution Control Finance Authority (CPCFA), an agency located within the Office of the State Treasurer, provides financing for private businesses to build pollution control facilities. When Albers left Southern California to move north, he needed to build expensive new facilities to collect, store, treat and dispose of the enormous amounts of liquid animal waste his mega-dairy would produce. In 2002, Albers received a $1.5 million tax-exempt bond loan from the agency to finance the cost of building the dairy's waste management system. The CPCFA also reimbursed him the $154,000 to cover the loan's administrative costs.

Albers said he was going to build a recycling system that would protect the environment from the waste produced at his massive facility. Instead, he installed a system with no alarm, no back-up pumps, and no redundancy in containment to prevent or contain accidental spills from the waste manure lagoons. He was also required by the Regional Water Quality Control Board to install an irrigation return flow system (to return liquid manure water to the lagoons after application to crop land). He did not. One night in November of 2003, a pump failed at one of the lagoons at the Heritage Dairy: the lagoon overflowed and sent 1.3 million gallons of liquid manure into adjacent irrigation channels and into the watershed. There were no alarms, so the spill was not detected until the following morning. If Albers had installed the appropriate system with safeguards, this massive spill might have been avoided.

The Heritage Dairy is not the only dairy to use this state program. Recent articles in the Los Angeles Times and the Fresno Bee revealed that, over the past four years, nearly $70 million in state bond money designated for pollution control has helped finance big dairies. The intent of the loans was to help dairy owners provide environmentally sound methods of disposing of animal waste. However, in many cases, the money helped them make lucrative moves from southern California to the San Joaquin and Sacramento valleys and to expand their facilities. According to State Treasurer Phil Angelides, who heads the CPCFA, the fault lies with the pollution control authority which failed to thoroughly assess the environmental impact of large dairies.

A 4000-cow dairy produces about the same amount of animal waste as the sewage of a city of 80,000 people. That is a lot of waste that can seep into our groundwater or end up in our surface waters through accidental spills or leaks. Large dairies also add considerable amounts of pollutants to the air. The waste lagoons emit millions of pounds of smog-forming gases each year, according to the San Joaquin Valley Air Pollution Control District, a significant contribution to the San Joaquin Valley becoming one of the nation's most polluted air basins. Large dairies are responsible for emitting very large amounts of ammonia in the air. Ammonia mixes with oxides of nitrogen to form tiny particulate matter that can lodge deep in the lungs and cause respiratory diseases. As conditions of the loans, the pollution control board did not require recipients to install any technology to prevent release of toxic and noxious gases from the lagoons.

Further loans have been frozen until a comprehensive review can be done and to ensure that, in the future, dairies that receive loans of this type actually do take steps to resolve environmental problems caused by their facilities.