The mound of paper produced by hospitals, corporations and financial institutions grows and grows.

Regulation has turned molehills into mountains. So just how do paper-pushers dispose of those mounds in an era of increased security risks and privacy laws?

Grants Pass residents Chris Isabell and Lowell Anderson and a silent financial backer tracked the trends for five years before becoming part of the paper mountain solution in September.

The company iSecure shreds documents in Southern Oregon and Northern California and has a growing customer base that includes Dutch Bros., Rogue Community College and Josephine County.

"Two years ago, we started putting plans together," says Isabell, the company president. "Last December we drafted the articles of incorporation and began putting meat on the bones."

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In addition to paper, iSecure shreds staples, paper clips, CD ROMs, binders, microfiche, X-rays, blueprints and laptop computers. The firm bills itself as an answer to protection against identity theft and intellectual property theft, while complying with new laws.

"There’s a standard now, where before it was whatever makes sense," Isabell says.

Reasonable measures for destroying documents are defined as pulverizing, incinerating or shredding.

"In the past, companies stockpiled documents, because it is such a chore to shred daily," Isabell says. "It takes a lot of time and employees have better things to do."

He says some companies he’s contacted used to send documents home with employees to burn during the winter.

While smaller companies might get by with an industrial shredder, larger entities have to be more aggressive.

Hospitals might produce 10,000 to 20,000 pounds of paper a month that they need to dispose of, he said. "I know of a hospital where one employee shreds paper and that’s all they do. That’s a lot of paper."

Legal precedents and legislative changes have spurred the growth in shredding and allied industries.

Bob Johnson, executive director of the National Association of Information Destruction in Phoenix, Ariz., said his group has grown from 170 members in early 2002 to more than 700.

"There is dramatic growth in the number of people offering shredding and a growing demand for the service," Johnson said. "Companies that don’t shred risk losing trade secret protection in court. Because of the privacy laws, corporations have to shred and their attorneys are telling them to shred everything all the time in the same way so they won’t get in trouble."

Privacy laws have forced medical, insurance, financial and other industries to destroy personal data of clients. Two congressional bills — the Health Insurance Portability and Accountability Act and Financial Services Modernization Act — assured a market for companies such as iSecure for years to come.

"The industry is going to grow for a while," Johnson said. "All industries go through a period of rapid expansion followed by consolidation."

It’s hard to quantify just how big the industry is in dollar terms, because many of the 1,500 companies won’t share financial data. Johnson estimates two-thirds go beyond the shredding into record storage and other areas.

While the majority of the companies resemble iSecure’s size, there are firms with outposts throughout the country. Boston’s Iron Mountain Inc., which bought Portland’s Docu-Shred Inc. last year, is the biggest of the bunch with 2004 revenue of more than $1.8 billion. Recall of Atlanta and Shredit of Oakville, Ontario, are two other major players.

It is one thing to shred, another to manage the process. iSecure markets its ability to help customers develop information security policies and practices.

"We think it’s important for a business to understand what its company record retention, management, disposal procedures are," Isabell said. "We’re finding with about half of the businesses we contact that when we start talking policy, they really start paying attention. It doesn’t take a sophisticated person to understand the rule, but most people running businesses have something better to do than becoming experts on document security."

Reach reporter Greg Stiles at 776-4463 or e-mail business@mailtribune.com.