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Stuart Johnson, Deseret News
Employees of John Kuhni Sons Inc. work on the giant cooker, which is part of the animal rendering process.

MILLS, Juab County — When John Kuhni Sons Inc. moved from Provo to Juab County five years ago, it smelled like a fresh start for Utah's only animal rendering plant. Provo was so eager for the malodorous company to leave its East Bay location, the city kicked in more than $2 million to help finance the move.

But Kuhni's tenure in Juab County has brought financial woes, family squabbles and a string of environmental violations that could shut it down for good.

John Kuhni started the company in Provo in 1937. Every day, it processes over 1,000 tons of animal carcasses and butcher scraps, along with restaurant grease collected from all over the state. That raw material is cooked and crushed into meat and bone meal used in animal feeds, as well as tallow for makeup and other products.

In recent years, Kuhni's grandsons fought in court over ownership of the company. A settlement finally left Kevin Kuhni with day-to-day control, and he oversaw the move to the new site just off I-15, about 15 miles south of Nephi, in 2004.

Problems began almost immediately.

"Kevin's a nice guy, but the management hasn't been there," said Tyler Young, an attorney for Kevin's brothers, Paul and Greg, who took over operations in March.

In January 2005, Juab County sheriff's deputies and officials from the Central Utah Public Health Department found a 10-foot-deep pit next to the plant containing "raw, untreated high-strength slaughterhouse wastes," according to court papers. The next month, they saw waste water running from the plant into nearby Chicken Creek.

The officials notified the state Division of Water Quality, which took samples found to contain fecal bacteria and other contaminants. The division issued the first of six violation notices the company would rack up over the following years.

Melissa Hubbell, an assistant Utah attorney general who has overseen efforts to enforce court-ordered cleanup measures and state fines of nearly $200,000, says the violations were "very egregious."

They include allegations the company illegally dumped boiler water from the plant on private property in Sanpete, Juab and Utah counties. Residents saw trucks releasing the water into a pasture in Palmyra, in southern Utah County, several times in the summer of 2007 and sent a video of the dumping to the attorney general's office.

State investigators later went to the site and stopped a Kuhni truck driver who said he had dumped water there "a couple dozen times," court documents say.

Plant managers blamed the disposal problems on equipment failures, operator error and misunderstandings. Young says at least some of the dumping was done with the knowledge of property owners but concedes the company never had a permit for it.

The company resisted paying the fines, saying in court papers it was in "precarious financial condition" and could be forced to close. It has now reached an agreement with the state to reduce the fines in exchange for completing facilities to treat waste water on site.

"There still remains some work to be done (but) there has been better cooperation and openness," state water quality director Walter Baker said. "What has been disappointing is that there have been continued violations. Hopefully, under the new management that will come to an end."

Young said the Kuhnis "understand what the issues are and are cleaning up. Significant strides have been made."

Juab County Attorney Jared Eldridge said the company has had "a very rocky relationship" with county officials and nearby residents, some of whom have complained about odors.

"Much of the time they've been in Juab County, they've probably been walking the line of whether the county wanted to allow them to continue," Eldridge said. "We don't want Kuhni to dispose of waste water in a way that puts the public at risk. The county is hopeful Paul and Greg (Kuhni) can salvage the operation and turn it into a good business partner."

Besides employing more than 40 people, the company provides a valuable public service.

"If they're not operating, there's going to be an uproar because you can't have that many animals going into landfills," Young said. "There's a need to have them around."

Baker agreed, saying there likely would be widespread clandestine dumping if Kuhni was not on hand to dispose of animal waste.

While the company says it is committed to maintaining a clean record from now on, a bigger challenge may be finding a business model that can pay down its $10 million debt.

Paul Kuhni says fuel costs have risen sharply with the increased distance to many of the company's pickup sites in northern Utah. In addition, the company lacks a direct line for the natural gas needed to heat its boilers and must have that delivered by truck as well.

Still, relations with area residents have been improving, with only one odor complaint in the past eight months, and Paul Kuhni is holding out hope.

"To me, it feels like we turned the corner months ago," he said. "I think things are looking good and going in the right direction."

e-mail: pkoepp@desnews.com