Distributed among the industrial brick buildings in St. Joseph, Missouri – once the starting point for the pony expression – lies the story of spending on government pandemics. Among nearly half a dozen crumbling structures, some have been placed with signs warning of conditions that ‘could pose an imminent and significant danger to human health or the environment’ ‘, are persistent reminders about HPI Products Inc. It’s the local pesticide company that has not yet cleaned up a mess it made a decade ago.
St. Joseph endures 25 years of HPI workers dumping industrial wastewater into the city’s sewer system. In 2007, the U.S. Environmental Protection Agency ordered HPI to stop illegally storing hazardous waste in corroded bins and leaking it into its warehouse. In 2009, the Department of Justice obtained a guilty plea from HPI, owner of the HPI, in federal court for violating the Clean Water Act and enacting hazardous waste laws. Garvey was sent to prison. The following year, the EPA obtained a consent decision against the company to pay clearance fees. Following the EPA violations, HPI Products Inc. rejected on January 1, 2010 – this means it can not seek federal contracts or financial assistance from the federal government.
Despite its long history of mismanagement and eventual dismantling, HPI was approved this spring for a $ 441,580 loan by the U.S. Small Business Protection Program, part of the federal government’s massive pandemic economic relief package, according to ‘ a review by NBC News.
Companies banned by the federal government are not supposed to receive these federally backed low-interest loans, according to the requirements for the PPP program. But the House Select subcommittee on the coronavirus crisis reported in September that more than 600 loans totaling more than $ 96 million to businesses excluded from doing business with the government had been found. Then on January 11, the SBA’s Inspector General reported that the number of loans to businesses excluded appears to be more than 950.
NBC News, which obtained the loan information under the Freedom of Information Act after a federal court ruling, was able to identify at least 60 businesses worth $ 32.4 million that were approved for PPP loans. NBC News was among a dozen news organizations that sued the SBA for disclosing the information under FOIA. Home staff were able to find more companies because they obtained additional information that was not provided to news organizations by the SBA.
According to the latest report from the SBA’s Inspector General, there are serious concerns about improper payments in the EMP program, including money excluded from businesses. It is said that the SBA has still not done enough to prevent these companies from getting loans and to prevent their loans from being forgiven.
U.S. Representative James E. Clyburn, DS.C., chairman of the House Select subcommittee, said in a statement to NBC News: the Select subcommittee in September that SBA approves hundreds of PPP loans to ineligible borrowers who have been excluded or suspended from federal contracting. ”
“Treasury and SBA must immediately improve oversight and accountability to ensure taxpayers’ dollars are not wasted,” he added. “I hope the incoming government will take timely action to improve oversight.”
Crafts Requirements
Since the PPP program began, companies seeking loans have had to confirm that they were not excluded. An SBA spokesman said the burden was on companies to provide accurate information, not on banks or the agency to verify the information.
The agency may consider federal criminal or civil prosecution for misrepresentations on government loan application forms such as not disclosing their exclusion. According to the authorities of the Department of Justice, there are no such cases yet, and the SBA could not point to any actions that cited the dissolution as a reason for legal action.
However, the SBA has said it is investigating applications for loan forgiveness and that it will reject requests from any excluded company it finds. “Debarment is one of the items that a borrower is not eligible for” for forgiveness, and they will have to repay the loan, an SBA spokesman said.
With the latest round of PPP loans, approved on December 27 as part of a $ 900 billion economic package, SBA officials say they are trying harder to eradicate fraud. This time, the SBA is holding a computerized check of every company seeking a loan. Applications will be screened by the treasury data systems to confirm the identity of the businesses. These computerized checks, which would take less than a day, would include tax confirmation numbers and other information, according to the agency’s representative.
Following the release of the Inspector General’s report this week, the SBA said its efforts to better detect fraud include working with the Treasury’s Do Not Pay team to identify companies that have been excluded. . While the inspector general reports that the steps are not yet fully in place, an SBA representative disagrees and says, “The handrail is in place.”
Causes ignition
Many of the NBC News companies identified have been turned down by the EPA for violations of the Clean Air or Clean Water acts. Others were banned by the Department of Homeland Security, Department of Labor and the General Services Administration.
In Missouri, HPI continued to commit a variety of offenses for the small town of St. Louis. To encourage Joseph. According to a lawsuit filed by the city on November 30, 2020, except for the EPA actions, HPI did not comply with the city code, and is still mixing and pesticides in its ‘increasingly abandoned facilities’. hit.
“He was so successful in not complying with it,” said Janet Storts, a local activist. Telling about HPI’s PPP loan, she noted that the company “only got another $ 400,000 because she did not do it right.”
EPA has confirmed that HPI is being rejected following the criminal conviction under the Clean Water Act. In the case of HPI, the ban is specific to the St. Joseph place where the violation took place, the same place for the approved PPP loan.
HPI did not respond to requests for comment.
Pollution problems
Nupro Industries Corporation, an oil and lubricant manufacturer in Philadelphia, uses the Neatsfoot Oil products to care for items such as baseball gloves and equestrian saddle. It has been approved for a $ 300,000 PPP loan, even though it has been excluded since 2012.
The company is expected to monitor pollutants in its industrial wastewater by sampling and testing for pollutants such as pH and ethylbenzene, which can cause breathing problems and dizziness with acute exposure. From 2006 to 2007, Nupro watered down its test specimens to appear according to EPA records in line with pollution limits. Nupro was prosecuted and pleaded guilty to a $ 200,000 fine.
AJ Berg, director of operations at Neatsfoot Oil Refineries Corporation, a subsidiary of Nupro, told NBC News the issue has been resolved. But he did not provide clarity on what issue and did not respond to follow-up questions.
Continued headache
Meanwhile, the city of St. Joseph continues to clean up the mess HPI left behind. Garvey still owns at least 11 buildings in St. Louis. Joseph. A third building the company previously owned was dilapidated and the city spent two years trying to get the business repaired to repair the roof. After a storm in 2017, the facade of the building collapsed.
HPI did not pay for the demolition of the building, but the city dug into its own funds and spent $ 390,000. Money was drawn from three funds, including the state’s casino initiative, which funds money for Save Our Heritage grants. These grants help owners of historic buildings in the city with the restoration and repairs on the outside.
But the city remains hoping for justice. Aimee Davenport, the lawyer representing St. Joseph, in his current case against HPI, said in the lawsuit that the city is asking for earlier damages and damages related to the city’s violations.
‘It’s an economic damage, public safety and environmental issue. “All this,” said Davenport. “We try to get them back to safety as soon as possible.”