The insurance company for Gary/Chicago International Airport wants a federal judge to reject the airport's claim for an insurance payout for losses it suffered due to environmental contamination on land it owns.
Old Republic Insurance Company, of Greensburg, Pa., filed an amended complaint in U.S. District Court this week contending that the underlying matters in the claim occurred decades ago, before the company insured the airport.
After an airport authority meeting Thursday, airport Director Dan Vicari said the airport was in no way responsible for the pollution that occurred. Beyond that, he said he could offer no comment because the case is now pending in court.
It has long been known that areas adjacent to the Gary airport were highly polluted due to past industrial activities. Some of that pollution migrated onto airport property. The airport also purchased some of those adjacent areas for its recently completed $174 million expansion.
Environmental contamination and its cleanup were always seen as one of the largest obstacles to the expansion, which added 1,900 feet to the main runway.
Old Republic Insurance Company cited a Sept. 8, 2014 letter from the Indiana Department of Environmental Management, which points out contamination at the northwest portion of the main runway and its southeast end. But the insurance company asserts the airport's policy clearly excludes that type of pollution and contamination.
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The policy would cover pollution or contamination if caused by an aircraft fire, collision or emergency, the court brief asserts.
The Gary airport authority has agreed with the Indiana Department of Environmental Management to undertake a broad range of containment and cleanup activities at the airport. These include long-term ground water and surface water monitoring, updating pollution prevention plans, and implementing additional ground water remediation.
The airport authority at its meeting Thursday heard about its first audit completed under Generally Accepted Accounting Principles in years. That audit was performed by Whittaker & Company, of Gary.
The annual GAAP audit is a requirement of bondholders under the $30 million-plus borrowing the airport did to complete the airport expansion.
The airport has been regularly audited by the State Board of Accounts under a different process.