More than half the frac sand companies operating in Wisconsin have violated Department of Natural Resources regulations, manipulated local governments or engaged in “influence peddling and conflicts of interest,” a study by an advocacy group has found.
The Land Stewardship Project, a Minnesota-based nonprofit organization that promotes sustainable agriculture, released this week a 30-page report that compiled and analyzed public data and news reports on Wisconsin’s booming frac sand industry.
Of the 47 frac sand operations studied, 43 percent violated DNR regulations — mainly stormwater permit offenses — requiring “substantial regulatory action” to bring them into compliance, the report found. Some mines, even after court actions and fines, failed to come into compliance at all.
“When you look at the readily available data, it really paints a picture of an industry that’s pretty comfortable with violating the rules and disrespecting local governments as a way of doing business,” said Bobby King, an LSP state policy organizer who supervised the study. “It’s a big problem.”
There were at least eight cases of frac sand companies “abusing” or attempting to abuse the annexation process to avoid county regulations, enticing local officials with settlement money, royalties and tax revenue, the report stated. Six of these instances occurred in Trempealeau County.
The report also documented five cases of so-called “influence peddling” in which sand companies hired local regulatory officials after a mine was approved. In Trempealeau County in 2011, frac sand specialist Kimarie Estenson was hired by Ottowa Sand Co., which is now Arcadia Sand, and as of 2012, Trempealeau County Environment and Land Use Director Kevin Lien had turned down four job offers from frac sand companies.
Also cited are six potential conflicts of interest — mainly local officials with personal ties to the frac sand mining industry. The issue is pervasive in Trempealeau County, where a member of the Land Environment and Use Committee also owns a truck-to-rail frac sand facility and a county board supervisor was an alleged partner in a local frac sand company. A member of the Arcadia Town Board publicly worked against a neighbor’s potential mining contract, only to work with the same company to get a mine on his own land, the report stated.
“It’s shocking that the industry won’t say ‘we have a problem,’” King said.
Rich Budinger, the president of the Wisconsin Industrial Sand Association, said Friday that while he cautions against using a single report as a definitive review of the sand industry, he isn’t completely surprised by the report’s findings.
“An upswing in regulatory activity in not unexpected given the field’s rapid expansion,” he said. “It’s likely we’re seeing a little bit of inexperience on the part of some new or smaller operators.”
WISA is a statewide organization that says it promotes safe and environmentally sound mining practices. One of the organization’s member companies, Smart Sand, is cited in the report for violations.
Budinger said the report highlights the importance of his organization’s work. He said that all of WISA’s members follow a strict code of conduct.
Budinger also said his organization supports fair and science-based regulation as well as strict enforcement of breaches of regulations.
“When someone in our industry gets a violation, it hurts all of us,” he said.
The number of frac sand facilities in Wisconsin increased more than tenfold within the last four years, growing from 10 in 2010 to 135 in 2014. To keep up with the boom, the state DNR hired two new environmental compliance engineers to monitor air quality, inspect mines and keep an eye on their operations.
Tanner Connors, one of the DNR’s new hires, said he’s not seen many violations since the air quality monitoring program kicked off in July.
“There’s been nothing outside the monitoring range,” he said, but he urged citizens to contact the DNR with complaints as soon as they notice excessive dust or other potential concerns at a frac sand site.
“It’s really helpful for us to get out there the same day,” he said.