<B>Smurfit Mill Fined by Oregon DEQ</B>

The Oregon Department of Environmental Quality fined an Oregon City paper mill $481,400 -- then reduced the penalty by 80 percent because the company voluntarily disclosed violations by its wastewater treatment manager, according to local newspaper reports.

The Oregonian reported that the penalty against Smurfit Newsprint Corp. would have been one of the largest in state history, but DEQ Director Langdon Marsh determined that the company qualified for a reduction to $98,280.

The case was the first test of a new agency policy encouraging polluters to report violations.

Last year, Smurfit told state environment officials that its wastewater treatment operator, Gary Field, had for at least five years falsely reported the amount of total suspended solids in the mill's wastewater. It also improperly sampled the wastewater, which discharges into the Willamette River and can contain paper-making wastes that harm salmon and other fish.

In notifying the company of the fine, Marsh noted that the state's environmental protection system relies almost exclusively on honest, accurate reporting by pollution sources. "Without it, the system can't function," Marsh said. But he expressed concern that a middle manager at the mill was aware of similar allegations involving Field as early as 1994 and failed to take action or alert superiors.

The DEQ did not conduct its own investigation, relying on the company's 17-page self-audit. The company submitted the audit in March 1999, just weeks after DEQ adopted its self-disclosure policy. Under the policy, companies that voluntarily disclose environmental violations can qualify for penalty reductions of 50 to 100 percent.

Smurfit's parent company, Smurfit-Stone Container Corp., recently sold the mill to KPS Special Situations Fund of New York, which renamed the mill Blue Heron Paper Co.