On September 13, 2013, the U.S. Department of Justice, U.S. Environmental Protection Agency and the San Joaquin Valley Unified Air Pollution Control District (SJVUAPCD) announced a Clean Air Act settlement to resolve air pollution non-compliance issues at Post’s Modesto, California facility.
The non-compliance issues arose prior to the acquisition of the Modesto facility by Post’s predecessor Ralcorp Holdings, Inc. in 2008. In an effort to remediate the non-compliance, Post filed a permit application in late 2008 with the SJVUAPCD. In 2009, both the EPA and the SJVUAPCD issued Notices of Violation related to the non-compliance issues. In December 2011, the SJVUAPCD issued a permit allowing for the construction of a state of the art air pollution control device, a Regenerative Thermal Oxidizer (RTO), at the Modesto facility. Post installed the RTO in early 2012.
The settlement completes the resolution of the 2009 Notices of Violation and requires the continued operation of the RTO in accordance with the permit issued by the SJVUAPCD.
To resolve the non-compliance issues, the Company has agreed to pay a penalty of $635,000 (which amount has been previously accrued). Post has incurred aggregate capital and expense costs in prior periods totaling approximately $1.8 million to ensure that the Modesto facility is in compliance with all environmental laws and regulations. Portions of the costs incurred to resolve this matter, including the penalty and the RTO costs, are subject to reimbursement from the previous owner under the terms of the 2008 acquisition agreement between Ralcorp Holdings and the previous owner. Post management does not expect the ongoing costs to test and operate the RTO to be significant. Post is committed to compliance with all environmental laws and regulations.
Post announced in April 2013 that management decided to close the Modesto facility. That decision was not related to the environmental issues resolved by the settlement.
About Post Holdings, Inc.
Post Holdings, Inc. is the parent company of Post Foods, LLC, Attune Foods, LLC and Premier Nutrition Corporation. Post has enriched the lives of consumers, offering quality foods since 1895. Post’s products are generally sold to supermarket chains, wholesalers, supercenters, club stores, mass merchandisers, distributors, convenience stores and the foodservice channel in North America. Post’s portfolio of brands includes diverse offerings to meet the taste and nutritional needs of all families, including such favorites as Honey Bunches of Oats®, Pebbles™, Great Grains®, Post Shredded Wheat®, Post® Raisin Bran, Grape-Nuts®, and Honeycomb®. With recent acquisitions, Post’s portfolio of brands now also includes Attune®, Uncle Sam®, Erewhon®, Golden Temple™, Peace Cereal®, Sweet Home Farm®, Willamette Valley Granola Company™, Premier Protein® and Joint Juice®. Post is dedicated to health and wellness, offering consumers a variety of choices to meet their nutritional needs. For more information, visit www.postfoods.com.