A Fort Morgan sugar plant that residents said emits an unbearable odor has been ordered to pay a $2 million fine for air pollution and water quality violations.

The Colorado Department of Public Health and Environment (CDPHE) on Friday said it has reached a settlement with the Western Sugar Cooperative to address noncompliance with environmental laws at the organization's sugar beet processing plant.

Residents in July 2017 told 9NEWS the stench coming from the plant smells "like dog poop" and "a dog fart."

"It would be really nice to go outside and not have to plug your nose," Brenton Kinnison, a resident of Fort Morgan, told 9NEWS last July.

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In its release, CDPHE said Western Sugar's air pollution violations include exceeding the state's regulatory odor limits.

In addition, CDPHE said Western Sugar violated water quality regulations, including "discharges of pollutants, including fecal coliform and sulfide, which significantly exceeded Western Sugar’s permit limits."

"Water quality violations likely contributed to odor issues affecting Fort Morgan residents," CDPHE said.

CDPHE also cited Western Sugar for unauthorized spills, and it said Western Sugar operated two large waste stockpiles containing coal ash and precipitated calcium carbonate ― both byproducts of the facility’s manufacturing process. The stockpiles are visible from Interstate 76 and Route 52, in violation of state solid waste regulations.

Martha Rudolph, director of environmental programs for CDPHE and Environment, said Western Sugar is working with CDPHE to bring its facility into compliance.

"Each step of the overhaul will proceed along a timeline and, when completed, both the residents of Fort Morgan and the environment will benefit from the improvements Western Sugar is making," Rudolph said.

Under the terms of the settlement, Western Sugar agreed to:

  • Identify and implement wastewater treatment.
  • Eliminate and/or properly dispose of waste stockpiles and any new waste generated through its processes.
  • Investigate groundwater and soil impacts, and implement corrective measures if necessary.
  • Implement and comply with an odor management plan.
  • Retrofit existing coal-fired boilers with natural gas burners.
  • Establish financial assurance.
  • Provide funding for a local water quality restoration project.
  • Accept suspension of its environmental permits or licenses if it fails to comply with certain terms of the settlement.