His father was a cotton farmer. Thus, his connection to the land, however tainted by the tortuous business of hazardous waste storage. This is a business Khosrow Semnani calls an environmental requisite. A business he quit in a brief return to the land. A brief encounter which, but for fate, might have seen Semnani sow stands of Christmas trees instead of strife.
On Tuesday, Nov. 5, Utahns will cast their consciences in a vote on Initiative 1, arguably the most confusing and personality-laden measure to reach the ballot. The confusion is largely purposeful. This is not supposed to be an easy issue.
Voters are being asked to judge the motivations and consequences of an industry born of federal regulations and nurtured by the claws of competition. They are being asked to decide who wears the white hat in a clash of egos and who should survive a battle between economists and environmentalists; whether this is a transparent personal vendetta or a legitimate attempt to draw tax dollars from the only private facility in the country disposing of the government’s nuclear waste.
The single hole-punch in this ballot means power to the people or freedom for enterprise, depending on how you see the process. But it may come down to who has the best P.R.—or the most money.
Most people call it the Envirocare issue. More formally, it’s called the Radioactive Waste Restrictions Act—26 pages of legalese that combine education and homeless issues with government ethics and the future of Utah’s hazardous waste storage.
The saga of hazardous waste disposal generally begins in the 1970s, when the Resource Conservation and Recovery Act (RCRA) was being shaped by the Environmental Protection Agency. But the debate had been raging since the 1940s, when scientists and technical experts had questioned whether land-based disposal might threaten soil and water.
Still, when RCRA went into effect in 1976, the Environmental Protection Agency cited only minor cases of pollution, pretty much ignoring the dire predictions from the scientific community, according to a study by the New Hampshire-based Franklin Pierce Law Center.
In fact, the predictions came true. Pollution, theft, illegal dumping and inept management combined to close several waste dumps taking low-level radioactive materials. Only three sites still exist to take low-level radioactive wastes: Chem Nuclear Systems at Barnwell, S.C.; US Ecology at Richland, Wash.; and Envirocare at Clive, Utah. The Barnwell site, which once took 90 percent of the nation’s waste, has drawn from as many as 39 states and the District of Columbia. The effect of a 1980 federal law, though, will whittle that down to three states by 2007.
There’s a war cry rising in Utah. “We’ve done our duty for the country,” says Frank Pignanelli, one of the movers of the initiative. “We’ve had enough. We talk about the west desert as if it’s far, far away, but it’s only miles from a major metropolitan area, and there we have chemical bombs, radioactive waste, all sorts of the refuse the rest of our nation is so willing to dump.”
Initiative 1, despite a mire of issues, is nonetheless on message to keep out certain classes of nuclear wastes—the higher level low-level nuclear wastes. But will it also drive one company out of business, spark a flood of ill-considered citizen initiatives, and throw the state into an expensive constitutional contest?
In a battle of the charts and graphs, the two sides like to point out different statistics to make their cases. For instance, Utahns for Radioactive Waste Control point out that the state takes 97 percent of commercial radioactive waste in the country. Utahns Against Unfair Taxes—the Envirocare people—like to say Utah’s share of low-level waste radioactivity (in curies, the standard measure of radioactivity) is less than 1 percent.
“Only 4 percent of low-level radioactive waste goes to commercial facilities,” says Hugh Matheson, the point man against the initiative. Matheson’s point is that Envirocare gets 97 percent of that 4 percent, diluting the effect of the chart.
But you may as well forget the charts. There will be no Ross Perots wielding pointers at the voting booth. Initiative supporters want you to concentrate on the ethics.
“We’re not billionaires like Mr. Semnani,” says Pignanelli, the former Democratic legislator who has teamed with conservative lobbyist Doug Foxley on the initiative. “We basically hope people will read the voter information packet and that they’ll prohibit higher levels of radioactive wastes and charge adequate taxes similar to the other two states. We want some ethical reform in the state of Utah, where it has been seriously lacking.”
They wanted it badly enough that they paid people to gather signatures on a petition. Envirocare, in turn, paid others to get signers to renege. Ultimately, the state Supreme Court upheld the initiative, and the reform it touts. For instance, there’s a clause that prohibits those who regulated the radioactive waste industry from working in it for up to three years. You might remember the big bribery scandal back in October 1996 involving Larry Anderson, the former Director of the Utah Bureau of Radiation Control, and Semnani.
Semnani gave Anderson gold coins, condos and cash worth $600,000, which Semnani calls an extortion payoff. Anderson was convicted and Semnani fined $100,000. But Semnani’s spin is that he was the victim here.
It’s all about him
Those who know Semnani have a hard time with the victim label. But he’s a lot more complicated than the Robber Baron tag would suggest.
His name comes from the city and province in northern Iran where he was born. Semnan, the center of a fertile agricultural region, sits on the southern foothills of the Albors mountain range. That’s where Semnani’s father grew cotton. An enterprising man with five wives and seven children, he also ran an automobile dealership importing from France, and at one point, had an ice factory.
“You supply a need,” says Semnani, who took the philosophy to heart.
In 1966, Semnani left Iran for college in England, where he stayed a few years before moving to Canada. It was an accident of necessity that brought him to Utah. He needed money and planned to hit up this friend of his brother’s who was teaching at Brigham Young University. Semnani jumped on a Greyhound bus to Utah, where the teacher had jumped ship. He was vacationing somewhere else.
To make ends meet, Semnani mowed lawns, painted for a real-estate agency and then tried to enroll at the University of Utah. At $500 a semester, it was too expensive for him. Westminster College took him on a promise to pay. Semnani worked there as a janitor, later became a teaching assistant and graduated in physics and chemistry in 1972. By that time, he’d married a German girl he met in England. With a line at the bottom of a congressional bill, then-Sen. Frank Moss made them both U.S. citizens.
Semnani had also been working as a researcher for Kennecott, electrifying copper. It was where he first got involved in the problem of waste disposal—specifically, arsenic. Kennecott carried him through his graduate years at the U, but in 1976, the price of copper plummeted, and Semnani was laid off. He and his wife divorced that same year.
Thatcher Chemical Co. hired him on as a waste treatment engineer. A few years later, he became manager of engineering and Thatcher became Sperry Univac, the high-tech company that merged to become Unisys.
So much was happening around Semnani. In 1979, the Shah of Iran was ousted. Semnani, a Muslim with a deep regard for his country, demonstrated against the new regime. In his adopted country, the EPA was ratcheting up the regulatory environment.
“Prior to RCRA, we were sending our wastes to the county landfill,” says Semnani. “All the companies were now subject to RCRA. An engineer said to me, ‘Khos, where are we going to take this stuff?’”
It might have been Arizona. A truckload of pollutants used to cost $50 or $60 at the Salt Lake County landfill. Now it was looking more like $1,000.
So, Semnani started thinking about how he might recover nickel or maybe zinc from the wastes. An easier solution, he thought, was to start his own disposal facility.
Semnani opened the state’s first hazardous waste landfill at Grassy Mountain, north of Clive in Tooele County. Clive, 60 miles west of Salt Lake City, was established in the mid-’70s as a place where the state could dispose of Vitro tailings from an old uranium processing plant. The stuff Semnani took at that time was nothing radioactive, but it was still too much for the county landfill. And it made him rich—or feel rich—in only a year’s time.
Semnani had been making $27,000 a year at Sperry. In 1981, he sold his facility to U.S. Pollution Control Inc. (USPCI), a subsidiary of Union Pacific Railroad. He got $40,000 right off the bat, with a letter of intent for $200,000 and more down the line.
“I retired for three days,” he says. That’s when the Christmas-tree bulb went off in his head. He went to Payson and Heber to study the science behind raising Christmas trees, but he came to the sad conclusion that Utah’s growing season was just too short.
Semnani turned to distributing dairy products for a year or so before he had another lightbulb moment. In 1983, be bought up some land in Wendover, Utah, cleaned up a junkyard there and started a housing development. He also got married again.
Ghazaleh was just a little girl when Semnani first met her in Iran. Now, educated in Georgia, she made the move to Utah for Semnani.
Meanwhile, USPCI bought a site at Clive where it took the Vitro tailings. In 1987, Semnani figured the tailings project was done, so he bought up some land around the site. The next year, he got a license to haul in contaminated soils from Superfund sites.
That was how Envirocare started—in a small trailer at Clive, with Semnani himself driving the forklift. Things are different now. Semnani knocks around his high-rise office at the corner of South Temple and Main. He hosts legislators and works the system from the inside out.
Consumer watchdog Claire Geddes snidely calls him “the King.” That’s because he generally gets what he wants when he asks for it.
“I created this industry,” Semnani says. “I’m now 55 years old and I’m comfortable. I’m in a position that I can make a difference in somebody’s life to make it better.”
Semnani says he’s built schools and clinics for his people in Iran. Of course, he’s contributed to countless Utah campaigns, helped pay off one of former Gov. Norm Bangerter’s debts, and has made Tooele a happy host. The county gets some $5 million or 5 percent of its gross revenues annually from Envirocare. It was able to build a multi-sport facility called Desert Peak Complex, and then used a $1 million donation from the company to construct the Utah State Firefighters’ Museum.
But he’s also made some people’s lives worse. Last year, he filed a $5 million defamation suit against some activists and competitors who he claimed were conspiring to destroy his company.
If some were quietly working against him, others have been screaming from the rooftops.
“If it’s important to Tooele County, why not to the state of Utah?” asks Foxley, maniacally pushing for a fair tax on Envirocare. It was, in fact, Foxley’s inner maniac that threatened to doom the initiative. He was not exactly Semnani’s favorite guy, and his participation looked a little suspect.
The issue isn’t the issue
“I was hoping the issue was whether or not we should tax the waste,” says Foxley. “Their strategy has been to divert attention from the real issue and to use vindictive tactics against Frank, me and others. Have I done some things? Have I been in the waste industry? Sure I have, but the issue isn’t Doug Foxley.”
Oh, but it could be. As much as the issue is Khosrow Semnani. Foxley calls himself a Utah boy, born and raised in Tremonton and graduated from Utah State University, with a law degree from the University of Utah.
Pignanelli remembers meeting him in 1986, when he was first running for the Legislature. Foxley calls him up and takes him to lunch.
“He gives me some small contributions, and says, ‘Look, there are some clients who have issues with your opponent; but don’t think there’s any more where that came from—just go out and get elected’,” Pignanelli says. “I thought, ‘Who the hell is this guy?’”
He’d find out soon. Foxley lobbied for business at the Legislature, often against issues Pignanelli supported. When Pignanelli ran for leadership in 1990, Foxley campaigned vigorously against him.
Foxley had long been a political player, and was appointed to the state’s most prestigious and powerful Board of Regents in 1985, the year after he ran Bangerter’s gubernatorial campaign.
In 1983, the city of East Carbon knew it was facing some big challenges. The Kaiser coal mine there was close to bankruptcy and, at times, unemployment in the area hit 50 percent. Garbage is always a hard sell, but talk began to turn toward developing a solid-waste disposal site—inside the city limits. They were desperate.
Foxley partnered with Steve Creamer, an industrial engineer who worked on the logistics of the 2,400-acre site. Foxley worked on the politics, and, before long, the East Carbon Development Corp. (ECDC) had signed contracts from one end of the country to the other to take industrial wastes. The concept depended on the idea of waste-by-rail, which had never been done.
“Whenever there are permitting issues or you have to go before the Legislature or there are siting issues, you get a lot of attention,” says a waste specialist familiar with ECDC. “It’s a very competitive industry. There are not a lot of those permits to be handed out, and whoever usually gets one has a pretty good chance of making a go at it.”
ECDC started up in 1992, but almost immediately hit a roadblock. Radioactive material was found in one shipment, and the public outcry led to a referendum in 1994 as some said the facility should be turned over to the county. As it turned out, the public overwhelmingly validated the landfill. It was, after all, pumping tippage fees of 50 cents per ton into county coffers.
As controversial as ECDC was, it was equally successful. Tax revenues enabled the city to bring in natural gas for the first time and to rebuild its road system. ECDC was directly responsible for keeping East Carbon High School open, and even guaranteed every graduating senior college tuition at the in-state college of their choice.
Foxley and Creamer sold out to Allied Corp., and Foxley still receives royalties. Allied owns part of a Tennessee facility which Semnani sees as a potential competitor. This just adds to the friction between the two men.
At one point, Foxley also lobbied for the law firm representing Waste Control Specialists, a Texas company looking to operate a low-level radioactive waste dump in far west Texas. Semnani actually bought up 880 acres there and outlined a plan to become a federal contractor for DOE waste there, according to a 1997 Texas Observer article. Semnani in effect forced Waste Control to move before it was ready. Both companies hired heavy hitters to lobby their cause, and are now embroiled in a lawsuit that alleges unfair practices.
That year, on the heels of the Anderson scandal, Foxley also made overtures to the Tooele County Commission about siting another low-level facility in the county.
Semnani saw it as an effort to compete with Envirocare. “George Mantes came unglued,” he says of the former Tooele senator. “At the end of the day, it’s all about money.”
Pignanelli admits that Foxley’s good at making money. He’s also good at co-opting the enemy. When Pignanelli left the Legislature, Foxley asked him to go into a consulting partnership. Two men with different strengths and different politics decided where they could meet on business ethics.
“Doug is a very complex figure, very smart, but he can be very aloof,” says Pignanelli. “It comes across as arrogance. He doesn’t suffer fools easily. He can be short. He can be moody. He’s a conservative Republican. But Envirocare doesn’t want people to remember they want to bring in B and C wastes. That is the lethal stuff. That is the No. 1 issue.”
What is the issue, again?
Envirocare’s license has been upgraded many times, inching above the dirty dirt that made the company. In 1990, it started taking “mixed wastes,” which include radioactive and hazardous contaminants. Then, in 1999, Envirocare, with the approval of Tooele County, sought a change in its license to accept A, B and C low-level radioactive wastes.
This is the part where people start to drop off. It’s also the part where the arguments get picturesque. Just know there are lots of different “waste streams” in the great river of radioactivity. What’s termed low-level radioactivity can be found in the ABCs to varying degrees. The stuff that’s slated to go to the Goshute Reservation, and ultimately to Yucca Mountain, Nevada, is way hot in that it comes from spent nuclear fuel rods. It’s off the alphabet chart. The ABCs of Envirocare, however, come from things like medical equipment, which aren’t in the same category, but are radioactive nonetheless. Envirocare is licensed to take A wastes, and has the regulatory OK for the Bs and Cs—the higher level of the low-level wastes. Detractors say it’s just a matter of time before the Legislature gives its approval.
Initiative supporters like to say you’d be dead in 20 minutes if you were locked in a room with that waste. Semnani likes to quip that you’d be dead faster than that if he locked you in a room and opened a natural gas valve.
“There are always risks; regulations require a level of risk and safety,” Semnani says.
The real issue, however, is not how fast you may die. It appears to be more about sending a message—to the country and to the Utah Legislature. Something like, “Utah’s not the nation’s waste dump and not even the Legislature can make it so.”
The frosting is some added tax revenue. Maybe.
Foxley and Pignanelli knew they’d need help to sell the Envirocare tax. If it were just the two of them, they’d fail for sure, like others before them. To get anywhere, they had to stick a smiley face on an otherwise nasty business.
Jack Gallivan, former publisher of The Salt Lake Tribune, hadn’t had any luck getting funding to endow his pet cause, the Utah Crusade for the Homeless. Equally frustrated was the Utah Education Association, facing budget cuts in a state that already suffered an image of paltry pupil funding. Both wagered that joining the cause would bring them money.
The initiative also creates “restricted special revenue funds” to which the added tax dollars would go. They could bring in up to $200 million in fees for schools and the homeless. Semnani thinks that’s nonsense.
“Poor UEA,” he says. “They’ve been duped. There will be two losers in this—Envirocare and its employees, and the state of Utah.”
That’s because he’ll be out of business, Semnani says, reaching in the air for invisible dollars. “We just lost a $20 million contract by 5 percent,” he says. “Five percent!”
If he could charge Envirocare’s customers more, he says, don’t you think he would?
Both sides have found experts to crunch the numbers. The numbers don’t match. And in a verbal war seemingly unparalleled in legislative history, the opponents blithely trash each other, threaten lawsuits and stir up passions.
Semnani says he’ll probably spend $2 million to defeat the initiative. Pignanelli and Foxley are guessing Envirocare will spend up to $8 million, while they are taking nothing. Their charity, however, is challenged daily.
Semnani pats his hip pocket. Remember, he warns, it’s all about money. “Everybody wants to know about our books,” he says.
“They will say whatever they want to say,” Foxley grumbles. “But I was 12 years on the Utah Board of Regents, I have four children in the public school system now, and I’m involved with the Gallivans, trying to find solutions to the homeless issues we have now.”
Semnani smiles inscrutably. He’s a dad, too. He just sent his oldest son off to college and is focusing on his young boys, 6 and 8. For Rod, the 8-year-old, Semnani packaged up a box elder bug in a contact lens case so he could take it to show-and-tell. There it was, sealed up tightly. That’s the way Semnani likes things.
There are a lot of ways you can evaluate the measure. You can look at it from the economic standpoint, from the environmental standpoint, or from a simple policy standpoint. You can even decide on its ethical implications. You’ll probably have to do your own math. But one thing’s for sure: No matter how you look at this issue, you’ll have to do it inside out to make a decision. The results of this initiative are bound to be varied and evolving, what with all the threats of lawsuits and legislation. So you may have to decide based on what you believe the intent to be. The principles involved—fairness, free enterprise, environmental protection or the sovereign will of the people—are easier to weigh than the consequences.
Jane Abe, a UEA member, struggles like everyone else to figure it out. “They think it’s about money,” she says. “It’s not.” But she still doesn’t know what it is about.
“If you have a conscience, you can’t vote against it,” she says. And then she sighs. “I will vote for it, but I can’t defend my vote. I can’t explain it.”