The case of the uncashed check is now concluded, with the City
of Morgan Hill finally depositing a check for $455,384.50 that Olin
Corp. sent in March to cover the cost of digging the San Pedro
well.
The case of the uncashed check is now concluded, with the City of Morgan Hill finally depositing a check for $455,384.50 that Olin Corp. sent in March to cover the cost of digging the San Pedro well.
The new well replaced the Tennant well, shut down in March 2002 when high levels of perchlorate were discovered in the water. The chemical had leached into the groundwater from a former Olin/Standard Fusee plant across the street where highway safety flares were manufactured for 40 years.
In April City Attorney Helene Leichter had said they would hold onto the check until they were sure Olin did not consider it full payment for the well replacement. Under California law, any money accepted can be counted as final payment.
“The city cashed the check on the basis of their representations that it (the check) did not represent full settlement,” said City Manager Ed Tewes Thursday. The first check, in effect, pays for work already done.
Tewes said that Olin has reviewed plans and cost estimates for completion of the well house, now under construction, and said they were reasonable and that Olin agreed to pay.
Rich McClure, spokesman for the Olin Corp. cleanup project, said he called Olin’s accounting department when he heard rumors that the check had been cashed.
“They confirmed that it had cleared the bank,” McClure said. “We had agreed to replace the well,” he said. “The city said ‘okay’ we’ll provide you with invoices now and more later.”
McClure said he preferred not to give more specifics about amounts because Olin and the city have signed a confidentiality agreement.
Another part of the original hold up was the matter of who shoulders the responsibility of future claims of damage from perchlorate in drinking water. The city wanted Olin to be responsible; Tewes said it hasn’t happened yet.
“We clearly do not have that,” Tewes said. “Their view is that they take responsibility for providing an alternative water supply for the need caused by the Tennant Avenue well. They will have met that obligation when they pay the cost of the new San Pedro well. We have no understanding at this point about future claims,” he said.
McClure would not comment on the matter of future liability but was positive about the cost issue.
“There are still outstanding costs for Olin and the city to negotiate,” McClure said. “I’m hopeful for an amicable solution.
“Olin is trying to do the right thing,’ he said, “but sometimes it’s difficult.”
CITY WELL REPORT
At Wednesday’s Council meeting, Tewes announced that the latest perchlorate tests of city wells were good.
“All wells tested non-detect (below 4 parts per billion) except the Condit well, which has been off line for some time and would remain off line,” Tewes said.
The treatment plant on the Nordstrom well has been working for several weeks, Tewes said, and the water “meets or exceeds federal and state standards.”
With the easing of hot weather, the high demands on water resources have also eased.
