News |

Chronic polluter General Iron is moving from its wealthy, white North Side home to a low-income Latino neighborhood. The feds want to know why.

Chicago is facing scrutiny from federal housing officials, who are investigating why the city is allowing a chronic polluter to move from the wealthy, largely white North Side to a low-income, predominantly Latino neighborhood near the Indiana border.

In a letter made public on Tuesday, the U.S. Department of Housing and Urban Development agreed to follow up on a complaint from community activists who accuse Mayor Lori Lightfoot’s administration of perpetuating racial segregation and housing discrimination in the nation’s third largest city.

At issue are steps taken by city agencies to benefit General Iron Industries, a clout-heavy scrap shredder with a long history of pollution problems. An Ohio-based company that bought General Iron last year wants to move the operation from Lincoln Park to a site on the Calumet River in the East Side neighborhood.

Activists contend the Lightfoot administration’s tentative approval violates provisions of the federal Fair Housing Act by adding another polluter to a neglected corner of the city, where residential yards, baseball fields and playgrounds are contaminated with heavy metals and toxic chemicals from other companies, including steelmakers that abandoned the area decades ago.

The complaint urges federal officials to withhold lucrative grants until the city overhauls its land-use policies. Zoning and planning ordinances protect industries in certain parts of Chicago without considering the health and well-being of people who live nearby, many of whom are Black and Latino.

“Racist policies are killing our neighborhood by making it a dumping ground for the dirtiest and most dangerous polluters,” said Peggy Salazar, director of the Southeast Environmental Task Force, one of three nonprofit groups that petitioned for federal intervention.

Under pressure from General Iron’s current neighbors, Lightfoot brokered a deal intended to ensure the company abandons the North Side by the end of this year. The existing scrap yard, on the Chicago River between North Avenue and Cortland Street, is surrounded by former industrial parcels slated to become the upscale Lincoln Yards mixed-use development.

Lightfoot also appears to agree with the spirit, if not the details, of the civil rights complaint filed by Southeast Side activists. A recent city report on air quality throughout Chicago notes that “structural racism and economic hardship” are “making it more likely for certain people to live in polluted communities.”

Pollution hot spots are concentrated in predominantly Black and Latino neighborhoods on the South and West sides, the city’s report found.

But despite Lightfoot’s repeated pledges to crack down on polluters, the Chicago Department of Public Health still approved one of at least two permits General Iron needs before moving. The department also stopped meeting with community groups to discuss environmental justice concerns.

“This approach towards our communities has to change,” said Cheryl Johnson, director of People for Community Recovery, another nonprofit group behind the federal complaint. “It’s fundamental that our voices are heard if we are going to dismantle environmental racism in Chicago.”

The mayor’s office did not respond to a request for comment.

If other permits are granted, General Iron will be the latest tenant of an East Side manufacturing district that already includes facilities handling brain-damaging metals and toxic chemicals. Nearby are two sites on the federal Superfund list of abandoned, highly contaminated industrial properties.

The proposed move drew the ire of community activists well before Reserve Management Group bought General Iron from the Labkon family, which operated the North Side scrap yard through four generations.

As surrounding neighborhoods gentrified, the Labkons protected their interests by spreading more than $500,000 in campaign contributions among local politicians. They also hired a bevy of City Hall lobbyists, including confidants of former Mayors Richard M. Daley and Rahm Emanuel.

The family is trying to sell its North Side properties but so far has been unable to find a buyer.

On the South Side, scrap already is being sorted amid ruins of the former Republic Steel plant between 116th and 118th streets. Reserve Management Group, also known as RMG, said it provides an important service by keeping scrap out of alleys and landfills.

“RMG has proven itself over decades to conduct environmentally responsible recycling activities and the addition of our shredding operation will be no exception,” the company said in a statement.

The Chicago Tribune reported in February that other affiliates of RMG had been operating on the East Side without the proper permits for at least four years. The companies also failed to file annual pollution reports that could have flagged violations of environmental regulations.

mhawthorne@chicagotribune.com