Plastics manufacturing facilities that have received billions of dollars in taxpayer support since 2012, including at least 14 in Louisiana, are polluting nearby communities of color, often in violation of the rules governing that financial support, a report released Thursday by the Environmental Integrity Project watchdog group says.
The report, based on federal and state data, found that the 14 Louisiana chemical companies received $5.6 billion since 2013 under the state’s Industrial Tax Exemption Program, which grants up to an 80% property tax abatement for up to 10 years for new projects.
If the facilities were built without the tax exemptions, that money would have gone to local governments and school boards to pay for public services, the report said. Government and industry officials who support such tax breaks argue the projects and jobs that come with them are unlikely to happen at all without the incentives.
The Louisiana information is part of a broader review of 50 plastics manufacturing plants, with others located in Alabama, Iowa, Kentucky, Mississippi, Ohio and Texas. It found that two-thirds of the plants received tax breaks or subsidies from state and local governments worth nearly $9 billion, or an average of $278 million per facility.
This map shows the locations of existing and proposed plastics plants around the country. (Image courtesy Environmental Integrity Project)
The report found that more taxpayer money is going to those plastics plants than to the combined annual budgets of the Texas and Louisiana environmental regulatory agencies.
“Despite frequent claims by the industry that it would protect the environment, 84% of the plastics plants violated their air pollution control permits over the last three years, according to EPA’s Enforcement and Compliance Online database,” the watchdog group said.
Four of the Louisiana plants are listed as in “high priority violation” of federal Clean Air Act rules as of Sept. 23, including Indorama in Westlake; Westlake/Lotte in Lake Charles; Formosa in Baton Rouge, and Dow in Plaquemine. All four were listed as being in noncompliance of the federal air pollution rules over the three previous years, according to federal Environmental Protection Agency records.
The federal records listed 26 separate enforcement actions among the Louisiana facilities, including 14 that resulted in a total of $5.6 million in fines. Between January 2018 and June 2023, those facilities also reported 135 accidents, upsets or other emission events that resulted in the release of 564,162 pounds of toxic emissions, according to the EPA records, the report said.
According to Census Bureau data, the population living within 3 miles of the Louisiana plants ranged from 1,445 to 36,991 people. For 10 of those plants, between 41% and 95% of those residents were people of color, while a dozen of the plants were located in areas where between 25% and 61% of residents were considered low income by the Census Bureau.
According to EIP research manager Alexandra Shaykevich, co-author of the report, most of the Louisiana facilities failed to comply with their permits, and also failed to meet hiring goals agreed to in accepting tax breaks under the state’s Industrial Tax Exemption Program.
“In Louisiana, there’s an environmental justice component,” she said. “According to our analysis, close to 600,000 people live within three miles of these plants and about two-thirds of them, 66%, are communities of color. That number gets a lot higher in certain places, including in Louisiana, where you are seeing some that are 95, 90% communities of color,” including along the Mississippi River between Baton Rouge and New Orleans.
The report’s recommendation that fenceline monitoring for pollutants be required at all plastics chemical plants is especially important for those communities since there’s a history of accidents resulting in toxic emissions, she said. Spotty monitoring can result in information about what’s been released not reaching residents for weeks, said Shaykevich.
Gov. Jeff Landry’s office, the state Department of Environmental Quality and the Louisiana Chemical Association did not immediately respond to a request for comment. Indorama, Dow, Lotte and Formosa also had not immediately responded.
In February, Landry issued an executive order eliminating the requirement that industries promise a certain number of new jobs as part of the tax forgiveness program.
The report uses Thailand-based Indorama’s renovation of an abandoned plant in Westlake as an example. The facility received about $73.5 million in tax rebates, beginning in 2016, to make PET resins used in soda bottles and single-use packaging from natural gas coming from fracking operations in Louisiana and Texas.
As part of its agreement, the report said, Indorama promised that it was “committed to being a positive influence in southwest Louisiana” and pledged “to meet or exceed all environmental regulations.”
But the report found the plant has repeatedly violated its air pollution limits. It found that the state DEQ issued 13 warning letters to the plant.
“But instead of cracking down or penalizing the plant, the state agency approved changes to Indorama’s pollution control permit four times between 2018 and 2023 that allowed the plant to release more air pollution – including a tripling of its permitted volatile organic compounds emissions,” the report said.
In February, the company and DEQ agreed to enter into a dispute resolution process in response to the agency’s June 2023 finding that the plant had violated emissions regulations dozens of times dating back to 2020. EPA also found the company in violation of federal regulations requiring it to have a risk management plan to deal with accidental releases.
But the report pointed out that the violations, even when confirmed by federal or state agencies, have not resulted in actions to either refund the tax breaks or prohibit companies from receiving future incentives.
The environmental group also points out that there are 10 new plastics manufacturing plants and 17 expansion projects proposed for construction over the next five years in Louisiana.
Smoke billowing from the Dow Chemical plant in Plaquemine during a power interruption incident in December 2016 (Staff photo by Terry Jones)
EIP contends there’s an overabundance of plants manufacturing the raw ingredients of single-use plastic products that end up as waste, which breaks up in the environment to create tiny particles that end up in humans’ blood and bodies.
“It’s so ubiquitous now that we’ve found microplastics in blood, in breast milk,” Shaykevich said. “We do need plastics for things like medical equipment and protective personal equipment … There are certainly important applications for plastics.”
“But the truth is that we have enough capacity currently operating or under construction in the U.S. to meet demand for critical products, and we certainly should not be subsidizing single-use plastics that end up as roadside litter.”
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