NEW Cooperative risked 211,325 gallons of oil spill at least 10 times.

The Non-Financial Ledger

Picture a small city. Charles City, Iowa, has around 7,000 people. Red Oak, Iowa, has roughly 5,500. These are places where people know their neighbors, where kids ride bikes past grain elevators, where the summer air already smells like fertilizer and diesel. These are also the towns where NEW Cooperative, Inc. decided it was fine to store and distribute anhydrous ammonia without properly telling local emergency responders what to do if something went wrong.

Anhydrous ammonia is not a theoretical risk. It is a colorless gas that liquefies under pressure for agricultural transport. When it leaks, it burns the eyes, the airways, and the lungs. At high concentrations, it kills quickly. It is so dangerous that federal law requires companies storing it above certain thresholds to submit detailed Risk Management Plans to the EPA and to actively coordinate with local fire departments and emergency planning committees, so that the people who would show up first to an accident know what they are walking into.

NEW Cooperative did not do that. According to EPA inspection findings documented in the consent agreement, the cooperative failed to provide its emergency action plans to local emergency planning and response organizations at both facilities. At the Red Oak facility, it also failed to document that it had ever coordinated with local authorities at all. This is a betrayal directed at first responders who had no idea what they were up against, and at the families living nearby who trusted that someone, somewhere, had done this basic paperwork.

The oil spill failures at the Red Oak facility carry their own quiet menace. The East Nishnabotna River runs adjacent to that property. The facility holds over 211,000 gallons of fuel oil in aboveground tanks and portable containers. The EPA found that those containers were not positioned to prevent a discharge. The tanks had not been tested for integrity. There were no adequate containment systems. Vehicles at the loading dock had no safeguards to prevent them from pulling away while fuel lines were still connected. The river was one accident away from an oil sheen, one neglected tank away from contaminating a water source that real communities depend on.

Nobody who lives near these facilities got a warning. Nobody got a vote. The dignity violation here is the simple fact that a corporation with a legal and moral obligation to maintain safe systems, write accurate plans, and communicate with neighbors chose, repeatedly and across multiple categories of federal law, not to bother. The fine they paid does not buy back the years those systems were ignored, and it does not compensate anyone for the risk they lived under without their knowledge.

Legal Receipts

These are direct quotes from the EPA’s own enforcement documents, reproduced exactly as written.

“Respondent failed to provide appropriate containment, diversionary structures, and/or equipment to prevent a discharge as described in 40 C.F.R. § 112.1(b) and fully describe them in the SPCC Plan, in violation of 40 C.F.R. § 112.7(c).”

Source: CWA-07-2026-0176, Paragraph 27(d)

• This is the EPA stating on the record that a facility storing over 211,000 gallons of fuel oil, sitting next to a river, had no adequate physical system to catch a spill if one occurred. This is the most fundamental requirement of oil storage law, and it was not met.
• This violation alone could expose the East Nishnabotna River to contamination from the full contents of any single tank in the event of a failure. The regulation exists specifically because rivers do not have off switches.

“Respondent failed to test or inspect each aboveground container for integrity pursuant to an industry standard described in the Plan, in violation of 40 C.F.R. § 112.8(c)(6).”

Source: CWA-07-2026-0176, Paragraph 27(g)

• The company was required to test its tanks on a defined schedule using recognized industry standards. It did not. This means no one had verified that the tanks holding hundreds of thousands of gallons of fuel were structurally sound.
• Combined with the absent containment infrastructure, this created a scenario where a failing tank had no backup system to catch what it released.

“At Respondent’s Red Oak, and Charles City facilities, Respondent failed to provide the emergency action plans to the local emergency planning and response organizations as required by 40 C.F.R. § 68.93(b).”

Source: CAA-07-2026-0177, Paragraph 36(a)

• Federal law is unambiguous on this point: companies storing dangerous chemicals above threshold quantities must give their emergency plans to local responders. This did not happen at either facility.
• In practical terms, this means that if an anhydrous ammonia release had occurred, the local fire department would have arrived without a facility-specific plan, without knowing evacuation zones, and without the coordination procedures the law requires the company to provide.

“At the Red Oak facility, Respondent failed to document coordination with local authorities as required by 40 C.F.R. § 68.93(c).”

Source: CAA-07-2026-0177, Paragraph 36(b)

• Documentation is not the same as communication, but the absence of documentation here is significant: either the coordination never happened, or it happened so informally that no record exists. Under federal chemical accident prevention law, either outcome is a violation.

“Respondent failed to design a containment system to hold at least the maximum capacity of any single compartment of a tank car or tank truck loaded or unloaded at the facility in violation of 40 C.F.R. § 112.7(h)(1).”

Source: CWA-07-2026-0176, Paragraph 27(e)

• This regulation exists for one specific reason: when a tanker truck or rail car is being filled or emptied, accidents happen. A hose disconnects. A valve sticks. A driver pulls away early. The law requires a physical containment area large enough to hold the full load of that vehicle. NEW Cooperative did not have one.
• The next violation listed in the same inspection confirms the loading dock also lacked warning lights, physical barriers, wheel chocks, or any interlock system to prevent vehicles from driving away mid-transfer. The two failures compound each other directly.

Regulatory Gray Zones

There are no gray zones to speak of in this case. Every violation documented by the EPA corresponds to a specific, unambiguous regulatory requirement. What the source reveals instead is a pattern of straightforward non-compliance with rules that have been on the books for decades.

• The Spill Prevention, Control, and Countermeasure (SPCC) regulations at 40 C.F.R. Part 112 have applied to facilities with over 1,320 gallons of aboveground oil storage since their promulgation. NEW Cooperative’s Red Oak facility held over 211,000 gallons. The obligation to maintain a compliant plan, conduct tank integrity tests, and install containment systems is not ambiguous. It is written in plain regulatory language that the coop’s very own Safety and Risk Manager is paid to know.
• The Risk Management Program under 40 C.F.R. Part 68 similarly provides no room for interpretation on the emergency coordination requirement. The regulation at 40 C.F.R. § 68.93(b) states that emergency action plans must be provided to local emergency planning and response organizations. The word “shall” appears throughout these provisions. There is no clause exempting cooperatives, small facilities, or agricultural distributors.
• The threshold for anhydrous ammonia coverage is 10,000 pounds, as listed at 40 C.F.R. § 68.130. The EPA’s inspection confirmed that both the Charles City and Red Oak facilities held more than this threshold. Coverage was mandatory from the moment that threshold was first crossed, according to the documents.

Profit-Maximization at All Costs

The source documents do not contain internal financial records or executive communications, so this section is limited to what the documented violations reveal about operational priorities.

• The SPCC plan at the Red Oak facility had not been reviewed or updated to reflect current container capacities and contents, as required by 40 C.F.R. § 112.5(a) and 40 C.F.R. § 112.5(b), which mandates review at least once every five years. Keeping an accurate, current plan requires internal labor and ongoing attention. Not doing it is cheaper in the short term.
• Tank integrity testing under 40 C.F.R. § 112.8(c)(6) requires engaging certified inspectors and potentially taking tanks offline for assessment. The company skipped it. This is a documented cost-avoidance decision that left the facility’s structural reliability unverified.
• Installing proper containment systems, interlocked vehicle barriers, and load-area safeguards all require capital expenditure. The EPA found violations in all of these categories simultaneously. The pattern across ten separate SPCC deficiencies at one facility suggests a systemic deprioritization of compliance investment.
• The combined penalty of $158,448 for years of multi-facility violations is a small number for an agricultural cooperative that handles fuel distribution and chemical sales across Iowa communities. The penalty covers two dockets, two facilities cited under the Clean Air Act, and one facility cited under the Clean Water Act.

Legal Minimalism: The Letter but Not the Spirit

Several violations documented in these consent agreements reflect a company that appears to have maintained the shell of compliance programs while gutting their functional substance.

• NEW Cooperative had an SPCC plan on file. Federal regulations at 40 C.F.R. § 112.3(a)(1) require owners and operators to prepare and “fully implement” such a plan. The plan existed, but the EPA found it failed to accurately describe the facility’s physical layout, failed to reflect current container capacities and contents, and had not been reviewed in the required five-year cycle. Having a plan that is outdated, inaccurate, and unimplemented satisfies the letter of the paperwork requirement while defeating the entire purpose of spill prevention regulation.
• Similarly, the Risk Management Plan under 40 C.F.R. Part 68 had been submitted by the company in some form, since the violations cited relate to specific missing fields (an operator phone number at Red Oak) and stale emergency contact information at both facilities. A plan that exists but contains outdated emergency contacts gives local authorities false confidence without providing actual protection.
• The compliance audit process under 40 C.F.R. § 68.58(d) requires documenting responses to audit findings and confirming that deficiencies were corrected. At Charles City, the EPA found the company failed to do this. This means the company was conducting audits, finding problems, and then not documenting the fixes. The audit existed as a procedural exercise; the corrective loop it was designed to enforce did not.

Societal Impact Mapping

Public Health

The documented failures at NEW Cooperative’s facilities created direct, measurable risks to people living and working in and around Red Oak and Charles City, Iowa.

• Anhydrous ammonia is listed as a regulated substance under 40 C.F.R. § 68.130 precisely because its accidental release can cause mass casualties. Both the Charles City and Red Oak facilities held quantities above the 10,000-pound federal threshold triggering mandatory accident prevention programs. The public health risks these thresholds reflect were real and present during the period of non-compliance.
• At both facilities, the cooperative failed to provide emergency action plans to local emergency planning and response organizations. First responders arriving at an anhydrous ammonia release without facility-specific plans face greater risk of exposure, incorrect response decisions, and inadequate evacuation coordination. This failure places first responders and surrounding residents at heightened risk.
• At the Red Oak facility, the company also failed to document any coordination with local emergency authorities. The consequence is that emergency response plans that may exist internally at the company were never communicated to the people responsible for executing them in a crisis.
• The 211,325-gallon aboveground oil storage at the Red Oak facility, with documented failures in containment infrastructure and tank integrity testing, represents a potential contamination source for the East Nishnabotna River. Contaminated surface water affects drinking water intakes, aquatic ecosystems, and downstream communities.

Economic Inequality

The communities at risk from these violations are small rural towns without the political or financial resources to independently audit or pressure large agricultural cooperatives.

• Red Oak, Iowa, and Charles City, Iowa, are small communities where agricultural infrastructure is often the dominant industry. Residents in these towns have limited ability to independently verify whether chemical storage facilities near them are compliant with federal safety regulations. They depend entirely on federal and state enforcement to protect them.
• A chemical release or river contamination event in a town the size of Red Oak or Charles City would impose costs, through medical response, environmental cleanup, lost tourism and agricultural productivity, and declining property values, that fall on local taxpayers and residents rather than on the cooperative. The EPA’s fine of $158,448 does not establish any compensation mechanism for affected communities if harm materializes.
• Agricultural cooperatives are structured as member-owned entities. Non-compliance savings accrue to the cooperative’s operational budget, which benefits member-owners (farmers with cooperative shares), while the risk of a spill or chemical release is borne by everyone who lives nearby, including people with no cooperative membership and no financial stake in the entity’s cost decisions.

Environmental Degradation

The documented infrastructure failures at the Red Oak facility represent a specific, documented threat to a named waterway.

• The East Nishnabotna River is a “water of the United States” under Section 502(7) of the Clean Water Act and is directly adjacent to the Red Oak facility, as confirmed in the EPA’s complaint. Federal law specifically triggered coverage of this facility because its location means it “could reasonably be expected to discharge oil in harmful quantities” to that river.
• The EPA defines a “harmful quantity” of oil discharge as any amount that causes a film or sheen on the water surface, a discoloration of the surface, or a sludge or emulsion deposited beneath the surface. The absent containment systems, unpositioned portable containers, and untested tanks documented in the consent agreement all increase the probability of such a discharge reaching the river.
• An oil discharge into the East Nishnabotna River would affect not only the river itself but the downstream Nishnabotna watershed, which drains into the Missouri River. The Clean Water Act’s purpose is explicitly “to restore and maintain the chemical, physical, and biological integrity of the Nation’s waters.” That purpose was compromised during the period of non-compliance.

The Settlement Isn’t Justice

Both consent agreements resolved the EPA’s cases against NEW Cooperative before any formal hearing, with no admission of wrongdoing from the company on the substance of the violations.

• The Clean Water Act consent agreement states explicitly: “Respondent neither admits nor denies the factual allegations asserted by the EPA in this Consent Agreement and Final Order.” This language, standard in administrative settlements, means the company paid $39,193 without ever legally acknowledging that its Red Oak facility had inadequate containment, untested tanks, or absent vehicle safeguards.
• The Clean Air Act consent agreement uses identical language: “neither admits nor denies the specific factual allegations stated herein.” A $119,255 payment resolved three separate counts covering both facilities, including the failure to share emergency plans with local authorities who remain, even now, at risk if a future incident occurs.
• The maximum possible penalty under the Clean Water Act for the violations documented here was up to $23,647 per day per violation, with a cap structure defined in the regulations. The assessed penalty of $39,193 reflects a negotiated figure, not the maximum the law permits for conduct of this nature.
• The Clean Air Act maximum was similarly set at $59,114 per violation for violations occurring after November 2, 2015. Three counts were settled for $119,255 combined. The settlement resolves only civil liability under Section 311 of the CWA and Section 112(r) of the CAA. The EPA explicitly reserves the right to pursue any other violations of those statutes or any other applicable law.
• Neither settlement requires the company to publish what went wrong, notify neighboring communities, or fund any independent audit of its other facilities across Iowa. The corrective action the company certified to is self-reported: its Safety and Risk Manager signed both agreements certifying that the facilities have returned to compliance.

The “Cost of a Life” Metric

How Long This Was Allowed to Continue

The EPA inspections occurred at specific documented dates. The violations documented represent failures that were in place at least as of those inspection dates, and in several cases the regulatory framework makes clear that coverage obligations existed from the moment threshold quantities were first exceeded.

This Is the System Working as Intended

The outcome of these two enforcement actions, a combined fine of $158,448, no admission of wrongdoing, and self-certified compliance, is not a malfunction of regulatory enforcement. It is exactly how administrative settlements under the Clean Water Act and Clean Air Act are designed to resolve cases of this type.

• The Consent Agreement and Final Order structure, used in both cases, allows the EPA to simultaneously file and close a case without a formal hearing, as explicitly authorized by 40 C.F.R. §§ 22.13(b) and 22.18(b)(2). This mechanism is built to move cases efficiently. Efficiency here means the company never had to defend its practices before a public record, and the communities near its facilities never had a formal forum to present themselves as affected parties.
• The “neither admits nor denies” language is standard in administrative settlements nationwide, not an anomaly invented for this case. Its consistent use means that fines paid under these agreements cannot be used as admissions in subsequent civil litigation by affected parties. It is structural protection for the company embedded in the settlement format itself.
• The penalty caps under the Clean Water Act and Clean Air Act are set by statute and have not been updated proportionally to corporate revenues since the laws were originally passed, though inflation adjustments apply. The result is that penalty amounts that represent meaningful deterrence for small operators may represent a minor cost of doing business for a large, multi-facility agricultural cooperative.
• The return-to-compliance certification in both agreements is signed by NEW Cooperative’s own Safety and Risk Manager, the same position responsible for the violations that triggered the enforcement actions. There is no independent third-party verification of compliance required under either consent agreement’s terms, as documented in the source material.
• The EPA’s right to pursue future violations is explicitly reserved in both agreements, but those future violations would require new inspections to detect. The inspection that found the Red Oak CWA violations occurred on May 1, 2024. The Red Oak CAA inspection occurred in December 2024. Charles City was inspected in August 2023. The intervals between these inspections represent windows during which documented non-compliance existed without enforcement action.

What a Legitimate Fix Looks Like

The core structural failure this case exposes is a compliance enforcement model that relies on periodic inspections, self-certification, and negotiated settlements without admission of wrongdoing, creating a system in which the cost of non-compliance is predictably lower than the cost of sustained, substantive compliance investment.

Regulatory Track

• The EPA Region 7 should implement a risk-tiered inspection frequency protocol that requires more frequent unannounced inspections for facilities storing regulated substances above threshold quantities adjacent to named waterways. The Red Oak facility’s proximity to the East Nishnabotna River and its 211,000-gallon oil storage capacity should place it in a high-frequency inspection category.
• Return-to-compliance certifications in consent agreements should require third-party verification by a licensed professional engineer for facilities with documented infrastructure failures, such as absent containment systems and untested tanks. Self-certification by company personnel is insufficient where the documented failures are structural and capital-intensive to correct.
• The EPA’s Chemical Accident Prevention Program should require facilities to provide proof of emergency action plan delivery to local emergency planning committees, with confirmation receipts filed with the relevant EPA regional office. The current framework requires delivery but, as this case shows, does not consistently verify it occurred.
• For facilities storing anhydrous ammonia above threshold quantities, the EPA should require annual public disclosure of Risk Management Plan status, including confirmation that emergency contacts are current and that local coordination has occurred within the preceding twelve months.

Legislative Track

• Congress should amend the Clean Air Act and Clean Water Act penalty structures to require that administrative penalties account for the size and revenue of the entity being fined, not solely the nature of the violation. A flat penalty cap that is the same for a sole-proprietor fuel depot and a multi-facility agricultural cooperative does not create equivalent deterrence.
• Legislation should require that administrative consent agreements involving oil storage facilities adjacent to navigable waters include mandatory notification to downstream communities and municipal water authorities, regardless of whether an actual discharge occurred. Non-compliance with spill prevention rules is a material risk to downstream users who currently have no right to notice under the existing framework.
• Congress should consider whether the “neither admits nor denies” structure in administrative environmental settlements should be prohibited in cases involving facilities that store chemicals capable of mass-casualty releases, in order to create a complete public record when those facilities are found non-compliant.

Corporate Governance Track

• NEW Cooperative’s board should require independent third-party environmental compliance audits at all facilities storing regulated substances above federal thresholds, conducted annually and reported directly to the board. The documented failure to review the SPCC plan for five or more years suggests that compliance program oversight is not functioning as a board-level governance priority.
• The company should be required by its board to establish a public-facing environmental compliance dashboard that reports the status of SPCC plans, Risk Management Plans, and emergency coordination documentation at all facilities, updated annually. Agricultural cooperatives that hold themselves out as community institutions bear a particular accountability obligation to the communities in which they operate.
• Executive and operational compensation structures should include an environmental compliance component tied to audit outcomes, in order to align financial incentives with sustained compliance rather than one-time settlement resolution.

What Now?

The entity directly responsible for these violations is NEW Cooperative, Inc., headquartered at 203 West Oak Street, Red Oak, Iowa. The consent agreements were signed by the company’s Safety and Risk Manager. Accountability for multi-facility, multi-statute non-compliance of this nature extends to the board and senior leadership of the cooperative, whose identities are not documented in the source material.

Regulatory Watchlist

• U.S. EPA Region 7 is the primary enforcement authority for both cases. Its Enforcement and Compliance Assurance Division, located at 11201 Renner Boulevard, Lenexa, Kansas 66219, is the office responsible for monitoring NEW Cooperative’s certified return to compliance.
• EPA National Enforcement and Compliance Initiatives track chemical accident prevention compliance under CAA Section 112(r). You can search the EPA’s ECHO (Enforcement and Compliance History Online) database for NEW Cooperative’s full compliance history across all facilities.
• Iowa Department of Natural Resources has concurrent authority over water quality protection in Iowa and should be a contact for anyone concerned about the East Nishnabotna River’s status relative to the Red Oak facility.
• Local Emergency Planning Committees (LEPCs) in Montgomery County (Red Oak) and Floyd County (Charles City) are the local government bodies responsible for chemical emergency planning. These committees have the right to request facility information under EPCRA (the Emergency Planning and Community Right-to-Know Act). If you live near these facilities, your LEPC is your most direct avenue to verify that emergency plans have actually been received.

Grassroots and Mutual Aid

• Request the RMP. Under the Emergency Planning and Community Right-to-Know Act, members of the public can request access to Risk Management Plan summaries for facilities in their communities. Contact your LEPC or the EPA’s RMP reporting system directly. This is your legal right.
• Attend LEPC meetings. Local Emergency Planning Committees are public bodies that must hold open meetings. If you live near Charles City or Red Oak, showing up to your LEPC and asking whether NEW Cooperative has provided its emergency action plans since the settlement is the most direct form of community accountability available to you.
• Connect with Iowa environmental organizations. Groups like the Iowa Environmental Council and the Iowa Sierra Club track state-level environmental enforcement and can amplify community concerns about facilities that have documented histories of non-compliance.
• Use EPA’s ECHO database. Search “NEW Cooperative” at echo.epa.gov to see the full enforcement history across all of the company’s facilities. If patterns of non-compliance exist beyond what these two cases document, that database will show it.