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City Denies Controversial Metal Scrapper Southside Recycling’s Permit

Above Photo: Community members, leaders and activists lay in the street in Logan Square to call on Mayor Lightfoot to deny the permit to move General Iron to the Southeast Side on the 30th day of the hunger strike on March 4, 2021. Colin Boyle / Block Club Chicago.

After Activists Wage Years-Long Fight.

Southside Recycling, formerly known as General Iron, will not be allowed to open on Chicago’s Southeast Side. “The Southeast Side is no longer going to be your dumping ground,” one activist said.

East Side, Chicago — The city’s health department Friday rejected the final permit needed for a controversial metal scrapper to open on the Southeast Side, a victory for local activists who spent years organizing to block the industrial facility’s move from the North Side.

Southside Recycling, owned by Reserve Management Group, will not be permitted to move troubled scrapper General Iron’s assets and employees to 11600 S. Burley Ave. in East Side.

Reserve Management Group spent $80 million in anticipation of a permit for the facility at the Burley Avenue campus, where the Ohio-based firm operates four other recycling facilities, company officials said.

Since General Iron’s plans to leave Lincoln Park were finalized in 2019, Southeast Siders have resisted the plan to open another industrial facility in an “area of environmental justice concern” for state regulators.

They filed federal civil rights complaintssued city officials and held numerous rallies and protests in an effort to block Southside Recycling’s operation. Several residents held a month-long hunger strike against the facility last year.

“Our community is not a sacrifice zone,” a coalition of a dozen advocacy groups said in a statement. “This decision can be a turning point for communities of color that have been hurt by environmental racism for decades. Although we are celebrating this decision, the community continues to deal with the toxic legacy that has allowed pollution to accumulate in our community and we will not stop fighting for our right to clean air, and we will continue to fight until the health of Chicago communities like ours can live in a healthy environment.”

A city health impact assessment, which analyzed the potential effects of allowing Southside Recycling to open, found the scrapper was unlikely to add significantly to the health hazards already disproportionately faced by Southeast Siders.

However, the scrapper would have added to the community’s air pollution; negatively impact residents’ mental health; continued the city’s trend of concentrating heavy industry on the Southeast Side; and risked bringing water and soil pollution, explosions, fires and noise to the community, the assessment found.

The health department “found the potential adverse changes in air quality and quality of life that would be caused by operations, and health vulnerabilities in the surrounding communities – together with the company’s track record in operating similar facilities within this campus – present an unacceptable risk,” officials said in a statement.

Southside Recycling is located less than a half-mile from Rowan Park, and about two-thirds of a mile from George Washington elementary and high schools.

The facility would have boosted the city’s recycling capacity, as Sims Metal Management in Pilsen is the only local metal shredder in operation after General Iron shut down at the end of 2020. Sims, located less than a mile from three schools, was sued by the Illinois Attorney General’s office this fall for allegedly breaking air pollution laws.

Southside Recycling would have also benefitted the Southeast Side’s economic development by creating 35 new jobs, according to the health analysis.

RMG officials blasted the permit’s denial as a political play, saying city health leaders ignored the results of their own health analysis and the state’s prior approval of the scrapper.

They vowed to “press their lawsuit against the city,” in which the company seeks $100 million in damages and the right to open for business. Federal and county judges have dismissed the case, though the company is appealing the county court’s ruling, spokesperson Randall Samborn said in December.

“What should have been an apolitical permitting process was hijacked by a small but vocal opposition that long ago made clear they would unconditionally oppose this facility, facts and science be damned,” Samborn said Friday. “Politics, not environmental or public health protection, is the only reason that the city denied Southside Recycling’s permit to operate.”

Though city officials said the analysis would inform their permit decision, the analysis didn’t say whether the city should issue the permit.

The report made no recommendation because the city is investigating “some apparent permit violations” discovered through the analysis at existing RMG facilities on Burley Avenue, Megan Cunningham, the health department’s managing deputy commissioner, said Tuesday.

The full assessment was not released to the public before a decision was made. Other aspects of the final report, including a federal health study that was incomplete as of Tuesday and an analysis of community input from three public meetings, will be released by Feb. 28.

Mayor Lori Lightfoot paused Southside Recycling’s permit review in May, after U.S. Environmental Protection Agency administrator Michael Regan said the Southside Recycling proposal “raised significant civil rights concerns” and urged the city to perform the health analysis.

Following the news Friday, Regan tweeted: “This is what environmental justice looks like.”

The city’s permit decision comes nearly 20 months after the Illinois Environmental Protection Agency approved Southside Recycling’s plans. A U.S. EPA investigation into the state’s approval was suspended pending mediation last March.

The health department’s denial also comes more than a year after officials quietly granted Southside Recycling’s first city permit — breaking their promise to give public notice about the scrapper’s application processes.

It’s been 15 months since Southside Recycling’s initial application for an operating permit, which the city rejected as “incomplete,” and 13 months since the facility’s second attempt.

Health department guidelines say the city will decide on a recycling facility’s application within 60 days after the application is posted online. Under that timeframe, a decision was expected last March.

How Did We Get Here?

Though Southside Recycling was denied its operating permit, company officials had plenty of reason to believe it would be allowed to open.

In July 2018, former Mayor Rahm Emanuel’s administration coordinated with Reserve Management Group to announce General Iron’s operations would move to the Southeast Side, according to the Sun-Times.

The first major step toward the facility’s potential opening came in June 2020, when the Illinois EPA approved permits for the facility.

U.S. senatorsaldermenactivists and neighbors voiced concerns with the scrapper’s plans during the state’s public comment period, citing General Iron’s history of environmental violations.

Problems at the North Side facility included a 2015 fire, a 2016 city-ordered shutdown, a 2017 harassment lawsuit and a 2018 citation for excessive air emissions. Following the 2018 citation, General Iron installed pollution-controlling equipment that would have moved to Southside Recycling.

After Reserve Management Group acquired General Iron in 2019, a pair of explosions in the pollution-controlling equipment forced the facility to temporary close in May 2020.

Weeks after the scrapper reopened following the explosions, and one week after Reserve Management Group paid the city $18,000 to settle all its outstanding municipal violations, a scrap pile fire occurred on-site.

But Illinois EPA officials repeatedly said they could not consider General Iron’s issues during the permit review process. Environmental groups rejected this claim, citing state law that says permit conditions may be “specifically related to the applicant’s past compliance history.”

State officials also said they couldn’t deny a permit over neighbors’ overwhelmingly negative feedback, nor the city’s indefinite shutdown of General Iron after the May 2020 explosions. The agency’s explanation caused Gov. JB Pritzker’s office to call for updates to environmental law.

The Chicago Department of Public Health approved the first of two city permits in October 2020, giving no public notice as leaders previously pledged to do. The air pollution control permit allowed Reserve Management Group to begin building Southside Recycling.

City health officials had promised to keep residents informed about the approval process — but the public didn’t find out Reserve Management Group had even applied for the permit until 15 days after it was approved.

Lightfoot said the situation wasn’t a failure on the city’s part. Instead, she said it was a “miss.” Her health officials said it “was an oversight and miscommunication.”

With the first permit in hand, Reserve Management Group began building the new facility in anticipation of final approval. Southside Recycling has been ready to open since early last year, company spokesperson Samborn said.

But in May 2021, EPA Administrator Regan wrote Lightfoot, calling on the mayor to pause the operating permit review and conduct a health impact assessment. Shortly after Regan’s letter was made public, Lightfoot announced the city would delay its permit decision.

Reserve Management Group sued the city for $100 million and an operating permit in federal court, then sued again in Cook County Circuit Court when a federal judge rejected the case.

Company officials argued the company and individual metal scrappers alike paid the price during the nine-month permit delay.

“The lack of competition is depressing scrap metal prices for smaller businesses and thousands of individual recyclers, who also must travel farther to find a buyer while the region’s metal waste continues to accumulate,” Samborn said in January.

The city’s decision to prevent Southside Recycling from opening after years of signaling otherwise “is a clear message to any businesses or industries that might be considering expansion or investment in Chicago: The city is not a reliable partner and is not open for business,” Samborn said Friday.

“Chicago has loudly stated that politics — not signed agreements, its own laws and regulations, nor actual protection of human health and the environment – is the ultimate consideration in all matters,” he said.

Southeast Siders Rejoice

The permit’s denial is vindication for Southeast Side residents who spent years calling on officials to bar Southside Recycling from opening.

Though the city’s unfinished report found “no appreciable risk” that Southside Recycling would cause immediate or long-term health effects, that justification misses the point, Southeast Side residents said.

As Megan Cunningham, the city’s own managing deputy commissioner of health, put it Tuesday: Even maintaining the status quo “can mean to perpetuate existing health inequities for the Southeast Side.”

In denying the permit, the city prevented industrial operations from moving out of a mostly white, gentrifying Lincoln Park community and into a majority-Latino neighborhood already overburdened with pollution.

The addition of another metal shredder would also have flown in the face of residents’ efforts to promote environmental cleanup and “green” jobs in their neighborhoods, they said.

These factors drove residents to organize against Southside Recycling. They turned out en masse for state- and city-led meetings, despite accessibility concerns and scheduling issues at those meetings, and applied public pressure on officials to deny the scrapper’s various permits.

A hunger strike in Feburary and March 2021 was the most extreme example of public pressure, drawing international media attention to the issue.

United Neighbors of the 10th Ward member Breanna Bertacchi, Southeast Youth Alliance co-founder Oscar Sanchez and George Washington High School teacher Chuck Stark fasted for one month. Yesenia Chavez, a biology student pursuing a career in medicine, participated in the strike for three weeks.

Ald. Byron Sigcho-Lopez (25th) was among those who fasted with the hunger strikers for shorter periods of time, while Ald. Jeanette Taylor (20th) — who collapsed at Chicago Public Schools headquarters in 2015 during a 34-day hunger strike to reopen a shuttered South Side high school — showed her support.

Residents also rallied at City Hall and in Lightfoot’s neighborhood, and in December marched to where they thought Chicago Health Commissioner Allison Arwady lives, calling on the health commissioner to deny the operating permit. Four people were arrested, cited and released at the December action.

George Washington High School students played a key role in the campaign, activists said Friday. The neighborhood’s youth led their own rallies and spoke out against the scrapper at other events.

Given General Iron’s checkered past, 10th Ward residents repeatedly called on Ald. Susan Sadlowski Garza to join their demands for Southside Recycling’s permit denial. Reserve Management Group has operated in the 10th Ward for more than 30 years, according to company officials.

Sadlowski Garza stopped short of doing so, though she called on the Illinois EPA to delay its permit decision in June 2020, just days before the permit was granted. She also asked the city to delay its operating permit review in February 2021, amid the activists’ hunger strike.

The alderperson praised the hunger strikers, saying she was “deeply humbled by the commitment to activism” and their advocacy for public health. But the year prior, she bristled behind the scenes at their campaign.

In April 2020, following a call with Southeast Side activists about General Iron’s operations potentially moving to the 10th Ward, Sadlowski Garza texted Lightfoot, “They disseminate the wrong information. They don’t play well with others so f–k them,” the Tribune reported in December 2021.

“I am riding with you till the end!” Lightfoot replied.

Sadlowski Garza didn’t comment on the text exchange to South Side Weekly In December, saying she refused to engage in “pearl-clutching hysteria.”

Southside Recycling is just one of several environmental issues Southeast Side neighbors have rallied around in recent years.

As they waged their “Stop General Iron” campaign, many of the same residents called for the Army Corps of Engineers to close a lakefront dump for polluted sediment while raising concerns over an underground warehouse proposal.

“We look to the city like, [the permit denial] is a great first step, but you need to continue to step up and make sure that we don’t have any more toxic developments coming into an environmental justice community,” Alliance of the Southeast executive director Amalia Nieto Gomez told Block Club at a Friday rally and celebration outside City Hall.

“We need to turn the tide now,” Southeast Environmental Task Force executive director Olga Bautista said. “The Southeast Side is no longer going to be your dumping ground. We want a community that is rooted in sustainability.”

The decision marks another environmental victory under Southeast Side environmental activists’ belt — on par with a successful campaign several years ago to remove petcoke piles that drifted into residential areas.

The permit’s denial is “an enormous victory for the community and for the fight against environmental racism,” a coalition of activists said Friday. They vowed to continue pressing city officials to enact policies that address health and environmental inequities on the Southeast Side and across Chicago.

“The City of Chicago must be dedicated to policies that prevent a situation like this from happening in environmental justice communities,” the coalition said. “Southeast Side residents will proceed with [Friday’s rally] as a way to celebrate, but also bring awareness to the need for significant reform.”

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