Most of $5M in WA fine forgiven for major Walla Walla gas leak

The owner of a gas station responsible for a major gasoline leak that shut down nearby downtown Walla Walla businesses has reached a settlement to pay only a fraction of nearly $5 million in fines and spill response costs.

The Washington state Department of Ecology said Monday that an agreement was reached that requires Wine and Country Store, the small business owner of the gas station, to pay the state $275,000.

The company recently filed for Chapter 11 bankruptcy, but continues to operate a Chevron gas station and store in downtown Walla Walla as it reorganizes in bankruptcy court. It has agreed to make the payment within 30 days.

Under the agreement it will not have to pay nearly $4.2 million in Ecology’s costs for its response to the gas spill discovered in September 2023. It must withdraw its appeal of the penalty to the Washington Pollution Control Hearings Board.

Ecology also will have increased oversight and reporting requirements for the business’s two remaining operational underground gasoline storage tanks.

The agreement will pave the way for cleanup of the spill to be done, said Brook Beeler, director of Ecology’s Eastern Washington region.

“This is the best path to protecting the environment, protecting people and supporting the local economy,” she said.

The Washington state Legislature has given the Department of Ecology $3.5 million for cleanup of contamination as required by the state’s Model Toxics Control Act, which is in addition to the nearly $4.2 million spill response.

The cleanup will make sure that the nearby Marcus Whitman Hotel and Convention Center has a permanent system for vapor extraction, groundwater is treated and underground tanks likely are removed, Beeler said.

Under the terms of the settlement agreement, Ecology retains the right to place a lien on the gas station and store property to recover the final cleanup costs and its time spent overseeing the project. Under a lien, the $275,000 payment being made now would be subtracted from the $3.5 million Ecology has to spend on the cleanup.

In addition, Ecology can still require the full $5 million payment of Wine and Country Store does not fulfill the requirements of the settlement.

Ecology reached the settlement agreement knowing Wine and Country Store was filing for bankruptcy.

Both parties wanted to avoid additional environmental risk, delays and the cost of further litigation, Ecology said.

“Ultimately, we didn’t want to leave the community of Walla Walla with an abandoned site that wasn’t cleaned up,” Beeler said.

Proceeding with the cleanup will make sure “that this property doesn’t become a dilapidated, defunct property in the heart of Walla Walla,” she said.

The leak caused the Marcus Whitman Hotel, a nearby office building and the post office to be evacuated after gasoline odors were detected on Sept. 14, 2023.

The historic landmark hotel was shut down for more than a month and the office building owned by Reata Ranches at 106 N. Second Ave. remains closed due to the spill.

Nearly 2,500 gallons of fuel contaminated the groundwater.

Reata Ranches filed a lawsuit in February in Walla Walla Superior Court against the Department of Ecology, its contractor Clean Harbors Environmental Services, and Wine and Country Store.

The lawsuit says that the office building was flooded with contaminated water by Ecology’s contractor during the state’s response to the spill, resulting in extensive damage and mold.

When Ecology hired a second contractor, a 3,000-gallon external storage tank ruptured and released potentially contaminated water, according to a statement from the owners of the office building.

Reata Ranches and Ecology disagree on what work still needs to be done to ensure safe conditions at the office building.

The owners of the building say they are innocent victims of an environmental crisis and have been “deprived of their property’s use, incurred substantial income loss and face mounting legal and cleanup costs.”