City rarely enforces environmental regulations for contractors, report finds

Chicago rarely enforces environmental regulations for city contractors, according to a new report released last month.

On October 1, Neighbors for Environmental Justice (N4EJ) released their second report in two years, “Paid to Pollute,” which found that the city department responsible for government contracts doesn’t monitor whether companies violate environmental regulations and there are few consequences for companies that do.

For community members in N4EJ, city compliance is personal. The group formed in the McKinley Park neighborhood in 2018 when MAT Asphalt, which holds millions of dollars in city contracts, constructed a facility across from the eponymous park and in close proximity to schools and homes. In 2020, developers canceled a planned 120-unit affordable housing project in the neighborhood after they failed to secure funding from the city or state over concerns about the plant’s emissions.

“When [MAT Asphalt] opened up, there would be mornings where I could tell they were running without even getting out of bed; the smell just gets into the house,” says NE4J member Anthony Moser, who authored the report. “When my kids went to the preschool that’s right there, where they would walk through that park all the time, and you’d have this big facility there just pumping smoke.”

The City of Chicago regularly contracts with hundreds of private companies for all kinds of work. According to the Department of Procurement Services (DPS), the city typically awards more than $1 billion through more than 300 contracts annually.

Companies have been required to report potential environmental violations to the Department of Law since 2014, but, according to the report, the department has no records of any such claims ever being reported—despite the fact that three major city asphalt contractors, Reliable Asphalt, Ogden Materials, and MAT Asphalt, have all had multiple citations in recent years. The three companies were awarded contracts worth more than $383 million combined for city work in 2023, according to city data.

MAT Asphalt did not return a request for comment. However, the company claims on its website that its facility is “one of the most modern asphalt pavement-making facilities in the nation,” and meets or exceeds all regulatory requirements.

Failure to report suspected violations constitutes a breach of contract by itself, but the DPS has no record of canceling a contract or barring a vendor for any reason, according to data from the report. “I think there’s a lopsided emphasis in the public understanding about the importance of legislation, where once we’ve made a rule and written it down, then the problem is solved,” says Moser. “One of the things I find to be a recurring theme in all of this is that a requirement is only a requirement if there are consequences for ignoring it, and if there aren’t, then it isn’t really a requirement.”

In a letter responding to N4EJ’s report, Sharla Roberts, the city’s chief procurement officer, pledged her “commitment that DPS will continue partnering with user departments overseeing vendor performance on these contracts to fully leverage this authority, especially on matters that pose potential public health risks. We will also seek to leverage additional resources, such as engaging with the newly reconstituted Department of Environment in support of this initiative.” (The DPS did not return the Reader’s request for comment.)

This would be a marked change for the agency, which in late September bucked a recommendation from the Chicago Office of Inspector General (OIG) to bar a longtime city vendor, Benchmark Construction, from further dealings with the city. The OIG made the recommendation after it discovered Benchmark fraudulently claimed to be based in Chicago to get a better deal on city contracts. Instead, the DPS arranged a settlement that required Benchmark’s CEO to retire and the company pay a $100,000 fine, but that allowed the company to continue business dealings with the city.

The city has previously considered environmental activists’ point that the DPS could refuse to award contracts to companies cited for environmental violations by the Chicago Department of Public Health (CDPH). During 2022 city budget hearings, Alderperson Andre Vasquez asked the then CDPH commissioner, Allison Arwady, why the results of CDPH investigations aren’t communicated to the DPS. Arwady responded, “It’s an interesting thought.” But the practice didn’t change.

The City Council will hold a hearing on DPS’s proposed 2025 fiscal year budget on December 4, and N4EJ members plan to come with questions for public comment. The group wants the city to go beyond enforcing the standards it already has on the books and to require compulsory environmental reviews of contractors and request documentation—like soil and water monitoring and air quality impact studies—that could help determine a project’s environmental impact.

“There are tools that are part of our law. It’s not about underutilizing them—it’s mostly been about ignoring them and not using them at all,” said 12th Ward alderperson Julia Ramirez at an N4EJ press conference on October 1. “We know that [the construction] industry is really important, but they’re large industries and we’re paying them so much money. We need to protect the people that are less fortunate.”

“Paid to Pollute” follows a report published by N4EJ in February 2023, which outlines a pattern of what community members see as a failure on CDPH’s part to monitor or adequately punish companies when they violate environmental laws, such as illegally dumping waste. The report illustrates that enforcement had dropped dramatically since Chicago’s Department of Environment (DOE) was decommissioned by then mayor Rahm Emanuel in 2012 and such investigations were taken over by the CDPH.

Mayor Brandon Johnson reinstated the DOE with a budget of $1.8 million last year, but the department’s focus will be on policy rather than enforcement, and it only employs ten people compared to the 60 it had a decade ago. As it stands, the CDPH will continue to oversee environmental compliance.

Community members and environmental advocates hope to see not just a change in enforcement but, someday, changes in how the city builds and maintains its infrastructure.

Moser says that while there is no pollution-free way to produce asphalt, there are steps the city could take to allow industry without compromising community health, including decentralizing production so that emissions aren’t concentrated in one neighborhood. “But the city finds it convenient to do it this way; they get asphalt that’s cheap—but it’s cheap because it’s being subsidized by the health of the community.”