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IBM is offering nearly 500 homeowners $10,000, or eight per cent of the value of their property, to compensate them for property damage resulting from polluted groundwater. Residents in Endicott, New York State, are eligible for the payment.

IBM has installed ventilation systems into some homes to clear toxic fumes rising from the water - residents complain that this has hurt their property values.

The deal was negotiated by Attorney General Eliot Spitzer. Anyone accepting the deal will lose the right to make further claims for property damage but can still sue for personal injury.

The water was polluted with volatile organic compounds from an IBM circuit board plant. Fumes have been leaking into homes through the cellars.

The mayor of Endicott Joan Pulse welcomed the announcement and IBM's ongoing clean-up campaign. She told AP that IBM had been a co-operative corporate citizen. Last month IBM agreed a programme to clean up the chemicals.

The offer is open until 30 November. ®

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