Jeffrey D. Allred, Deseret News
Stericycle medical waste incineration plant in North Salt Lake City Thursday, May 30, 2013.

NORTH SALT LAKE — Stericycle has agreed to a $2.3 million fine and will cease operating in North Salt Lake under a proposed settlement agreement inked with state regulators.

Under the agreement — which requires the approval of the Utah Air Quality Board — Stericycle would pay half of the total penalty, a little more than $1.1 million immediately, and agree to stop operating in North Salt Lake within three years of receiving its new operational permits for a planned move to Tooele County. The other half of the penalty would be waived and handled as a credit once the permits are obtained and the move completed.

The pending settlement includes the largest fine in the history of the Utah Division of Air Quality and is the maximum civil penalty that could have been levied. It was based on the number of days the company operated its plant out of compliance with federal Clean Air standards.

"It provides a resolution to the violation but also a better situation moving forward for the residents and the company," division director Bryce Bird said, adding the penalty holds a large, international company accountable and should act as a deterrent for it and other companies when it comes to violating pollution standards.

Alicia Connell, co-founder of the grass-roots organization Communities for Clean Air, said the ideal settlement would have forced the company to leave Utah altogether.

"Due to the current laws and regulations, this is as good as it gets," she said. "We are grateful that Stericycle was willing to negotiate terms of when they will relocate, and we hope that they take it very seriously and that they move it forward as quickly as possible."

The company, which operates the West's last remaining medical waste incinerator, has long been criticized by its suburban neighbors given the proximity of its operations to homes and schools in the Foxboro subdivision just west of I-15. In May of 2013, the division issued a notice of violation to the company, asserting it had violated its permitted threshold for emissions.

Regulators first became suspicious in late 2011 and throughout 2012 during a series of three stack tests to determine the level and nature of pollutants released into the air from the plant. Tests are supposed to be conducted at the maximum production or combustion rate and reflect normal, operational variances.

According to the May notice, the company first attempted to blame a flawed laboratory analysis for tests that were in violation of emission limits. After the division obtained additional information, it found that a Dec. 27-28, 2011, stack test exceeded levels for hazardous pollutants, as well as nitrogen oxides, or highly reactive gases.

Regulators asserted that there were repeated problems with other tests and discrepancies that popped up in the company's logs that misled them, including logs that were manipulated and not reflective of normal operating conditions.

The U.S. Environmental Protection Agency has been conducting a criminal investigation into allegations the logs were deliberately altered and a new investigation was launched after a former employee described the on-grounds incineration of radioactive waste.

Tim Wagner, executive director of Utah Physicians for a Healthy Environment, said the proposed fine appropriately reflects the egregious nature of the violations, but the delayed time frame for a move out of North Salt Lake is unacceptable.

"We have some major concerns for over how long this could drag on," he said.

The state-issued violation touched a maelstrom of controversy over the plant's operations in North Salt Lake, igniting protests and marches, sit-ins at the governor's office, a health study and even the involvement of environmental activist Erin Brockovich.

Lawmakers had to officially sign off on a proposed move by the company to Tooele County and passed legislation to establish a 2-mile buffer around any new location to ward off similar neighborhood tension.

Stericycle has been in negotiations with the Utah Schools and Institutional Trust Lands Administration for a parcel of land about six miles south of U.S. Magnesium Corp.

The Utah Air Quality Board is slated to meet Wednesday and take action on the proposed settlement.

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