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Taxpayers subsidize plastics plants that violate pollution standards, report says

MICHEL MARTIN, HOST:

Over the last decade, the number of plants that use fossil fuels to make plastics has grown across the U.S. A new report finds those plants routinely break environmental laws even as they receive large subsidies from taxpayers. "The Allegheny Front" reports on environmental issues in Western Pennsylvania. Their reporter, Reid Frazier, tells us about a plant in Pennsylvania that got huge tax breaks, violated its air pollution permit even before it opened.

REID FRAZIER, BYLINE: Rebecca Quigley's favorite spot in her house is a wraparound deck with a sweeping view of her hometown of Vanport in Western Pennsylvania. But these days, something else dominates her view across the Ohio River - a major industrial plant built by Shell to produce plastic.

REBECCA QUIGLEY: At nighttime, we call it Gotham City because it lights up the sky and is - it just looks like a great big, huge city over there.

FRAZIER: The plant is called an ethane cracker. It turns ethane, a component of natural gas, into tiny, plastic pellets used to make products from food packaging to medical devices. It was finished in 2022, part of a wave of plants built to take advantage of cheap natural gas from America's fracking boom. But since it's opened, Quigley has noticed black smoke and strange smells in the air.

QUIGLEY: There was a sweet odor of antifreeze or syrup smell - odor that was in the air.

FRAZIER: State regulators have found the plant violated air pollution laws 19 times since opening two years ago. It's released compounds that contribute to asthma as well as carcinogens like benzene. Quigley and many of her neighbors worry about long-term health effects.

QUIGLEY: It does concern me, not for myself as much as it does for my grandkids or my kids or my community.

FRAZIER: Shell's plant isn't alone. A new report from an environmental group found the fleet of new plastics plants in the U.S. often release illegal levels of air pollution, even while receiving big tax breaks from state governments to set up shop. Alexandra Shaykevich of the Environmental Integrity Project is the report's lead author.

ALEXANDRA SHAYKEVICH: We found that 94% of the plants that we looked at reported accidents or incidents, so-called emissions events, these are illegal upsets that occurred when a plant malfunctions, when there's a fire or an explosion.

FRAZIER: Taxpayers are often footing part of the bill for these polluting plants. The report found state and local governments gave almost $9 billion in tax breaks since 2012 to encourage companies to build these plants within their borders. Most of these plants are in the Gulf Coast and disproportionally located in nonwhite communities that are largely low income. In Pennsylvania, the Shell plant received over $1 billion in tax credits from the state. Shell didn't respond to questions about the report. States often argue the subsidies are necessary to bring economic development, and some in Pennsylvania say it's money well spent.

KEN BROADBENT: The Shell cracker plant was one of the best things that happened to Steamfitters Local 449.

FRAZIER: Ken Broadbent is business manager for the local Steamfitters union in Pittsburgh. He says the tax credit helped bring high-paying jobs to Pennsylvania.

BROADBENT: Ohio and West Virginia and Pennsylvania were in the running for the cracker in a tri-state area, and we were able to beat them by attracting them with better tax credits. That's how the game's played, whether I like it or not.

FRAZIER: But Shaykevich says communities shouldn't have to choose between jobs in their health.

SHAYKEVICH: We think if companies can't obey the law, they shouldn't be getting taxpayer money.

FRAZIER: She says in the future, taxpayer subsidies should be tied to better environmental compliance.

For NPR News, I'm Reid Frazier in Pittsburgh. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Reid Frazier