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Dispute Between Alcoa And Boonville Could Have Larger Impact

Alcoa wants to expand its operations at Liberty Mine in Warrick County.

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It’s unclear when the legal battle between a small, southwestern Indiana town and an international aluminum producer could move forward.

Alcoa wants to reopen multiple smelters and bring about 275 jobs to the community. In order to do so, the company says it needs to expand its mining operations at Liberty Mine near Boonville.

The town isn’t against the deal, but residents want certain protections for those living near the proposed expansion site. The dispute is now caught up in court.

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Alcoa’s History in Warrick County

Alcoa mines material, and then transforms that material into aluminum. It’s a complicated process that requires several steps. The company’s Warrick Operations plant is a sprawling facility located along the Ohio River.  It sits about 10 minutes south of Boonville, where Alcoa mines coal to run parts of the plant.

The company has a more than 60 year relationship with Warrick County, but it hasn’t been without struggles.

According to an Alcoa press release, the company cut 600 jobs in 2016 after closing the Warrick Operations smelter.  Yet, in a decision that rarely occurs in American manufacturing, the company announced in July it would re-start three of the five smelting lines.

Smelting is a process that helps refine the raw materials into more usable material that eventually makes aluminum.

The entire Warrick Operations facility employs 1,250 people.  The re-opening will result in an estimated 275 jobs.  Some of those hires will include former employees, the company said.

In hopes of luring the company to return, Indiana’s Economic Development Corporation and Warrick County offered Alcoa up to $2.4 million in conditional tax credits and up to $100,000 in training grants for new hires. However, the relationship between the company and the community has changed since then.

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Negotiations Reach a Standstill

The City of Boonville passed an ordinance in November that bans mining within three miles of city limits. According to the ordinance, it seeks to “protect the long-term future and growth of the city, while ensuring the viability of future economic development of the area.”

Neighbors living near the proposed mine expansion site also formed a group called Save Our Homes LLC. They outlined several concerns about how the mine might affect their health and property values.

“So, basically they’re going to clear out all this area, mine it,” says Save Our Homes Founder Ron Nelson, as he points to the wooded area across the street from his yard. “We’re going to have no view of anything but big trucks and a bunch of dirt.”

Along with the city, Nelson and his neighbors came up with a list of demands they want Alcoa to honor. The list includes a larger buffer zone between homes and the mining activity, additional seismic monitors, and a modified insurance claims process.

“The city of Boonville and myself personally are not against the mining,” says Boonville Mayor Charles Wyatt. “I prayed every day that the smelter was shut down that something would happen for these people and for Warrick County.”

Wyatt says he just wants to make sure the city and its residents are protected if something goes wrong at the mines.

The city, Save our Homes, and Alcoa entered into mediation on Jan. 3. Wyatt says he thought they had reached an agreement. But an email obtained by Nelson shows the company would only agree to the stipulations if Boonville repealed its mining ordinance, and approved permits and authorizations to operate the mine.

“We learned at the eleventh hour that the only way Alcoa would agree to what we had negotiated was that if it was not in writing,” says Mark Phillips, the attorney representing both the City of Boonville and the neighborhood group. “They finally acknowledged that they never intended to enter into an enforceable agreement with anybody.”

After the failed mediation, Alcoa filed a lawsuit against Boonville.

Alcoa spokesperson Jim Beck says the company believes the ordinance violates state law.

“We’ve worked and offered many things that meet or exceed state regulation to address concerns of the neighbors,” Beck says. “It’s just simply that we believe the ordinance violates Indiana law and inappropriately attempts to supersede the authority that belongs with the state.”

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Statehouse Proposal Could Impact Case’s Outcome

While the dispute between Alcoa and Boonville remains caught up in court, a bill passed out of Indiana’s House of Representatives could strip regulatory authority away from local governments and municipalities.

Rep. Jeff Ellington (R-Bloomington) authored House Bill 1289.  It seeks to prohibit local governments from regulating the extraction of natural resources on private property. An amendment to the bill means it could also stop them from regulating mining.

Rep. Ron Bacon (R-Boonville) signed on as a co-author of the legislation. Bacon, who received campaign donations from Alcoa, declined to comment.

The bill passed 63-27 out of the Indiana House and is currently in the Senate Natural Resources Committee.  It’s unclear whether the bill will garner enough support to reach a full Senate vote, but the Senate returns to the statehouse next week.

Regardless of what happens at the statehouse, Nelson says the situation between Alcoa and Boonville illustrates a bigger problem.

“We’re not trying to prevent jobs, we’re not trying to prevent Alcoa from opening the smelter,” Nelson says. “I just think at some point, people should come before the money of corporate America.”

The dispute will be addressed in court on Mar. 14.

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