SAN GABRIEL VALLEY / COVER STORY : Who Will Be King of the Hill? : West Covina’s Battle to Close Landfill Is Headed for a Courtroom Showdown

The afternoon rush is on as scores of trucks power up a hill and into the heart of the BKK landfill to dump their cargo--11,000 tons of garbage on any given day.

A worker fires a pistol loaded with blanks to scare off hungry sea gulls while earthmovers maneuver like soldier ants, preparing to spread a cap of earth over the day’s haul.

Benjamin K. (Ben) Kazarian Jr. and his son Ken, second- and third-generation garbage men, sit in their tidy office on the landfill grounds and lash out at those who would shut down their $40-million-a-year operation at the end of November.

“It’s the fear-syndrome game,” said Ben, 66, who owns the West Covina landfill with his four sons.

“We’re literally fighting for our business and personal lives out here,” added Ken, the eldest son at 45.

In a tidy neighborhood about a mile from the landfill, a trio of activists grouses about the truck traffic and the smell. They worry about toxic emissions, ground-water contamination from the dump and depressed housing prices.

“(The Kazarians) promised us it would close in 1995,” said Jean Arneson, who has been pushing for closure of the dump since the early 1980s. “It’s been nothing but broken promises.”

The City Council agrees that BKK Corp. broke a promise, and the showdown is about to begin. The city sued the Kazarians in June, 1993, to force closure of the landfill, one of the nation’s largest. After four months of failed mediation, the City of West Covina vs. BKK Corp. is scheduled to go to trial on Feb. 22 in Pomona Superior Court.

For the parties involved, not only will

the trial decide the legal dispute but it also will speak to questions of character and motivation that surfaced during the decade-long debate over the future of the dump.

Are the Kazarians money-grubbing businessmen or conscientious entrepreneurs? Are they flouting the environmental well-being of the city and a 1985 agreement? Or have they been unfairly targeted by a group of conniving residents and city officials who are willing to spend millions of taxpayer dollars on a misguided legal battle?

The trial centers on a single document, a “memorandum of understanding” signed by city officials and the Kazarians a decade ago. The city’s lawyers argue that the agreement unconditionally requires the Kazarians to close the landfill in November.

BKK’s lawyers, including former state Atty. Gen. John K. Van de Kamp, contend that the agreement is not binding because the Kazarians, for various reasons, never realized their plan of building a corporate park. The park would have been built on virgin ground within the boundaries of the landfill to replace the revenue lost from the dump.

“There’s no guarantee we’ll win, but I think we have a decent chance,” said West Covina Mayor Bradley McFadden, who was recently threatened with recall by a citizens group for suggesting a compromise that would have allowed the dump to stay open.

McFadden, one of the city’s negotiators, said he abandoned negotiations last month after the Kazarians would not make any meaningful concessions. He voted with the council majority to spend $1.24 million to go to trial.

Councilman Benjamin Wong, who told The Times he would prefer a negotiated settlement, abstained, citing the high cost. The city already has spent $1.3 million on its legal battle with BKK.

The Kazarians have spent even more--about $3 million, Ken Kazarian said. The stakes are high, with landfill space increasingly scarce and dumps able to command good fees. The landfill accepts household, commercial and nontoxic industrial trash from throughout Los Angeles County. The Kazarians do not divulge their annual profits, but the landfill grosses about $40 million a year.

“Do you know anybody in his right mind who would throw away millions of dollars without receiving something for it?” Ken Kazarian said. “They can make a very credible argument that sounds terrific but, legally, it doesn’t hold water.”

The BKK landfill is viewed by the Kazarians as a birthright, of sorts. The late Benjamin K. Kazarian--Ben Jr.’s father and Ken’s grandfather--started the operation more than three decades ago.

Home Savings & Loan once owned the 583 acres that make up the landfill. The firm contracted with the Kazarians to open and operate the landfill in 1962. The Kazarians bought the dump site in the mid-1970s.

In 1972, BKK began accepting hazardous waste. It took in more than 3 million tons of toxic substances, including cancer-causing vinyl chloride and benzene, before the Kazarians closed the toxic waste portion of their operation in 1984, citing a new era of stringent environmental regulations.

Over the years, the landfill proved a cash cow for West Covina, which receives 10% of the landfill’s gross revenue. That is projected to amount to at least $3.7 million this year, more than 10% of what the city will spend on general operations.

But the landfill also has had its dark side.

In 1984, 21 families were evacuated from their homes near the southeast portion of the landfill, the area where toxic waste was dumped, when high levels of methane gas were detected in their neighborhood. High levels of vinyl chloride also were detected.

And in 1987, BKK paid $43 million to more than 500 neighbors to settle a lawsuit that sought damages related to the 1984 evacuation, including the fear of developing cancer. Dozens of homes sit near the landfill’s northern and southern borders.

The environmental problems associated with the dump persist and are likely to stretch well into the next century.

The U.S. Environmental Protection Agency and state agencies are overseeing BKK-funded studies to determine how to reduce vinyl chloride emissions. The levels are high enough to trigger state-mandated warnings to residents in a neighborhood southeast of the dump. The studies also seek to pinpoint the extent of ground-water contamination from the landfill and come up with a remedy. A study on health risks associated with the dump is also in progress. After the 1984 evacuation, city officials and residents started pressing for BKK to close sooner than 2006, the expiration date of the permit granted by the city in 1971.

As an incentive, the city offered BKK a tax break and an opportunity for a commercial development at the landfill in exchange for closing in 1995. The Kazarians agreed, leading to the disputed memorandum of understanding.

Ken Kazarian and local officials are shown smiling in a local newspaper photo taken the day the document was signed in 1985. Former Mayor Forest Tennant was one of the smiling faces. Tennant said there is no question in his mind about the intent of the memorandum of understanding.

“It never dawned on anyone that we’d be having this controversy and discussion at this time,” Tennant said in a recent interview. “1995 was the absolute, drop-dead, outside deadline.”

The collective smile has definitely faded, replaced by the grimace of legal and political wrangling.

The sticking point is whether BKK has to close if it doesn’t have its corporate park, which BKK proposed but never built. The Kazarians say the memorandum definitely links the two. The city disagrees.

The two sides also disagree on why the development never materialized.

The Kazarians say they presented various plans to city officials, who found problems with them--perhaps deliberately, the family says.

City officials contend that the Kazarians frequently changed their minds about what they wanted. They slowed down the process and, in the end, failed to present an acceptable plan.

The dispute dominated last November’s council elections, with two candidates supporting BKK’s efforts to postpone its closure and two others vowing to shut it down.

“That was the issue, the only issue, for many people,” said former Councilman Richard N. Jennings, who lost his seat. “It’s ridiculous; people are just leading an emotional parade out here in regard to the dump.”

Jennings and candidate Stuart York argued that the city could not afford to lose BKK, its largest tax-revenue producer. They supported a settlement that would have allowed the dump to operate beyond this year.

Sensing the political ramifications of the race, BKK dived deeply into the political fray. It spent thousands of dollars on full-page newspaper ads and cable TV commercials that mostly touted the company’s sizable contribution to the city’s tax base. But BKK also accused Councilman Steve Herfert, who made dump closure a key issue in his reelection campaign, of being an irresponsible financial manager. The firm used phone banks, mailers and newspaper ads in an attempt to block Herfert’s reelection, but it did not make any donations to council candidates more sympathetic to its cause.

BKK also filed a lawsuit against Herfert during the campaign, alleging that he had overstated the health risks associated with the landfill. A Superior Court judge ruled in favor of Herfert, but BKK is considering an appeal, a BKK spokesman said.

“It was a very ugly election,” said Herfert, who received the most votes of any candidate.

Landfill opponent Michael Touhey finished second, replacing Jennings and greatly increasing the odds that the city would eschew a last-minute settlement and proceed with the trial.

In retrospect, Ken Kazarian said, BKK’s effort in the council race was a waste of money. But company officials consider it part of its ongoing line of political defense. In addition to entering the fray in local elections, the company has contributed to races for state and national office, including Gov. Pete Wilson’s 1994 reelection campaign.

Election records show that since 1987, the Kazarians, their chief administrative officer and the corporation have contributed about $350,000 to candidates in state and federal races, not necessarily landfill proponents.

“You have to make contributions to politicians,” said BKK’s chief administrative officer, Ronald R. Gastelum. “Not that we get something out of it but . . . there’s always the fear people will come after you and use you for their political purposes.”

The City Council’s decision to go to trial carries some heavy political responsibility. First, the city would have to make do without taxes from the dump. But McFadden said the city has been preparing for the closure. About $1.5 million was cut from this year’s budget without layoffs or significant cuts in city services.

And city officials hope at least another million will be trimmed next year. That will involve contracting out some city services, possibly leading to layoffs, which officials say they will try to avoid.

“Yeah, we can use the money, but we’re in strong financial condition,” McFadden said.

Another consideration is the expense of maintaining the landfill after it closes.

BKK officials say they are making insurance payments to provide about $60 million for closing the landfill and maintaining it afterward. But BKK officials contend they will be unable to meet the annual insurance payments of $8 million to $10 million a year if they are not allowed to stay open at least until 1999, when the last of the payments will be due.

If that happens, the Kazarians warn, the site could end up on the EPA’s Superfund List for priority cleanup, triggering a series of lawsuits and countersuits to determine who will foot the bill to maintain the landfill.

So far, the Kazarians say they have spent $68 million since 1984 on environmental investigation and remediation, including an extensive gas-collection system and water pumping and treatment.

“There are people out there who think we have more money than the U.S. Treasury,” said Ken Kazarian.

Despite the pending trial, BKK is continuing work to expand into 24 untouched acres on the northern border of the landfill, the Kazarians said. They also have agreed to lease a landfill site to a private company that plans to use methane generated by decomposition at the dump to manufacture methanol.

But the city is also on the offensive, recently hitting BKK with a notice of violations for 31 alleged problems at the landfill. Those range from failing to maintain an adequate gas-collection system to failing to properly maintain slopes. If not corrected, the city could fine BKK or seek to suspend its operations, an action that could end up in court, said Michael Miller, the city’s environmental services director.

Ken Kazarian said he would work with city officials to resolve any problems, but he considered the notice of violations an attempt to make life difficult for BKK.

BKK also is proceeding with its plan to build a new landfill in Elsmere Canyon near Santa Clarita. An environmental impact report on the proposal is under review.

The Kazarians say they gladly would close BKK if they can open the Elsmere Canyon dump, but that is not likely to happen in the near future.

Santa Clarita residents have mounted strong opposition to keep BKK from securing the necessary permits. The proposed dump, which would take in 190 million tons of household waste during the next 50 years, would contribute to air pollution and traffic and threaten ground water, opponents contend.

“We’re figuring on a couple of years of litigation on that,” Ken Kazarian said.

“In our industry, we have a saying,” his father said. “Everybody wants you to pick it up, but nobody wants you to put it down.”