State lawmakers question authority to spend 3M dollars

At a House Ways and Means Committee hearing Monday at the Capitol, lawmakers questioned whether two state agencies have the authority to spend a $850 million lawsuit settlement between 3M and the state and asked whether legislative action is needed.

"There's an awful lot depending on this money being spent," said Jim Knoblach, R-St. Cloud, the committee chairman. "I just wonder if maybe we don't need to look at doing something this session to create this fund and help facilitate it and make sure that there isn't any doubt about the ability to get this money to the people that it needs to get to."

Under the agreement, 3M will pay a grant of $850 million into the state's remediation fund. The top priorities for the funds are providing long-term clean drinking water for residents and habitat restoration in the affected area, which includes the cities of Cottage Grove, Woodbury and Oakdale, among others.

Minnesota Attorney General Lori Swanson had sought $5 billion for natural resources damage caused by perfluoronated chemicals, or PFCs, produced by 3M. The two sides reached the agreement last month, the day a trial in the case was scheduled to begin.

When Swanson announced the settlement, she said the money would be protected so it could not be tapped by the Legislature for other purposes.

Some committee members asked whether legislative approval is needed for the Minnesota Pollution Control Agency and the Department of Natural Resources to allocate the funds.

"This is not about PFCs. It's not about cleaning up pollution," said Rep. Pat Garofalo, R-Farmington. "This is about who decides and who makes decisions with public money."

Swanson did not attend Monday's hearing. Officials from the MPCA and the DNR told the committee they believe their agencies do have the authority to spend remediation funds.

Under the settlement, 3M also agreed to pay up to $40 million to provide temporary drinking water solutions as outlined in a 2007 consent decree the company signed with the state.

Knoblach questioned whether 3M would still be on the hook to keep paying even after the 2018 settlement has been fulfilled.

Rep. Debra Hilstrom, DFL-Brooklyn Center, countered the court retains authority over the settlement, so if the Legislature interferes, it would be violating a court order.

Hilstrom also noted that the state originally sought $5 billion to clean up the problems caused by the PFCs.

"So the idea that we're going to have all this leftover money is probably not very accurate," Hilstrom said. She added that the chemicals don't break down in the environment and have been found around the globe.

Rep. Sarah Anderson, R-Plymouth, questioned why the state attorney general's office paid an outside law firm $125 million rather than handling the lawsuit itself.

"As I see it, this is just taking money away from the people in the east metro to address this water problem," Anderson said.

DNR assistant commissioner Barb Naramore said the fees paid to the Covington & Burling law firm amounted to 15 percent of the settlement. The firm was retained on a contingency basis, she said, so it was only paid if the state collected a settlement.

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• Cities grapple with costs of removing PFAS from drinking water