Sriracha Plant Mulls Move, Providing Valuable Lesson to Government Meddlers


That's gonna leave a mark.
Credit: Dave77459 / photo on flickr

"I have had the bad luck to move into a city with a government that acts like a local king." That's what David Tran, founder of Huy Fong Foods and producer of Sriracha hot sauce, said to the Los Angeles Times after the Irwindale, California, City Council last week unanimously declared his factory a "public nuisance" due to the alleged smell.

Baylen Linnekin wrote in December about the history of the factory's issues and the regulatory troubles Tran has faced in California. Back then Linnekin wondered if the company might move out of California to escape its issues with regulators and the meddling government. The possibility seems more likely now. From the Times:

Huy Fong Foods' Executive Operations Officer Donna Lam said that Alabama, Pennsylvania, Louisiana, Kansas, Ohio, Georgia, Iowa, Arizona, New Mexico and West Virginia have offered to host factories. A cadre of local officials also have thrown their support behind the hot sauce maker, including state Sen. Ed Hernandez.

U.S. Rep. Tony Cardenas, whose district includes the San Fernando Valley, joined the chorus of voices clamoring to host Sriracha production on Wednesday.

It's worth pointing out that Irwindale is a tiny, little industrialized cog in the greater Los Angeles area, with a population of less than 1,500. Yet 40,000 people are employed there. It is a place where people work, not live. From the city's own demographic data, less than 1 percent of Irwindale's land is used for residential purposes. By contrast, 43 percent of land in the city is used for industrial purposes and 31 percent of the land is open space. Roads take up more space in Irwindale than housing.

Yet, as of 2007, Irwindale boasted 134 city employees and its own police force of 27. According to its stats in 2007, the little town had a monthly payroll of more than $777,000. Dennis Romero of LA Weekly noted the odd relationship between Tran's company and Irwindale:

It is a strange tale. As Tran has told it, Irwindale actually lobbied to get Huy Fong to move from its old digs in Rosemead to Irwindale, which it did in 2010. But when Tran got a bad feeling about initial odor complaints he decided to take preemptive action.

He was essentially paying Irwindale for $250,000 a year for 10 years to use the factory. But he surprised City Hall by buying it outright, depriving Irwindale of millions in future rent.

Most of the odor complaints have come from four nearby homes, one of which is occupied by the relative of a city councilman. That councilman, Hector Ortiz, recused himself from discussion and voting on the matter because, he says, he owns property near the plant.

At the same time, the city was looking to sell property it owns next door to Huy Fong to a waste-management facility, which could be ironic given the odors sometimes associated with those kinds of facilities.

Romero also noted that two current council members and a former council member face conflict-of-interest charges for using taxpayer funds for a lavish trip to New York City.

Now that the discussion of the Sriracha plant moving is taking on tones of actual possibility, Irwindale's city attorney is acting confused about Tran's response:

Irwindale City Atty. Fred Galante said he was confused and disappointed by Tran's actions. Galante said Irwindale officials just want an action plan to be submitted, and Tran has not proposed any solutions for the city to reject.

"This seems very extreme," Galante said. "It's disappointing given that [air quality officials] have explained that there are readily available solutions."

He seems to have forgotten the fact that Irwindale is already suing Tran's company. Maybe that's the origin of Tran's lack of trust?