Millions In Federal COVID-19 Aid Went To Companies With Pollution Violations

At least five companies with histories of violating environmental rules secured emergency government loans totaling as much as $32 million to retain employees during the early months of the coronavirus pandemic.

Those companies, most in the energy sector, have collectively paid more than $52 million in penalties for violations of clean air and other environmental regulations, according to an analysis by the watchdog group Accountable.US and HuffPost. Each secured a sizable loan within a month of the Paycheck Protection Program launching in early April, which Congress created to help assist small businesses.

In some cases, subsidiaries of the companies also received loans, totaling between $4.35 million and $11 million.

Accusations of giving preferential treatment to the powerful and well-connected have plagued the PPP program. More than a dozen major donors to President Donald Trump’s campaign raked in at least $41 million in federal assistance through the program, as HuffPost previously reported. Businesses owned by members of Congress managed to land loans quickly, while tens of thousands of small businesses found it difficult to gain access to the emergency funds. And more than 7,000 oil, gas and petrochemical companies have received a total of $3 billion to $7 billion in PPP money, according to an analysis watchdog group Documented conducted for Sierra Magazine

Businesses with past environmental violations are not barred from receiving the loans. But watchdogs and environmental advocates argue that the PPP, which the U.S. Small Business Administration oversees, should not be subsidizing polluters.

“These companies have a clear history of violating public trust and the law by contaminating the environment in pursuit of profits,” said Chris Saeger, a spokesman for Washington-based Accountable.US. “Our federal government should not be essentially giving back portions of the penalties they’ve paid, but that’s exactly what the Trump administration is doing through the PPP.” 

One of the aid recipients, CountryMark Refining and Logistics, a subsidiary of Indiana oil company CountryMark, agreed in 2013 to pay more than $18 million to settle violations of the Clean Air Act at its refinery in Mount Vernon, Indiana. That included a $167,000 civil penalty and $18 million to install new pollution controls at the facility to reduce emissions of numerous pollutants, including sulfur dioxide, volatile organic compounds, particulate matter and benzene. 

The Environmental Protection Agency said at the time that those new controls would “reduce emissions of harmful air pollution that can cause respiratory problems, such as asthma, and are significant contributors to acid rain, smog, and haze, by an estimated 1,000 tons or more per year.”

CountryMark Refining and Logistics was awarded a $5 million to $10 million PPP loan on April 15 to help it retain its 380 employees. Two other CountryMark subsidiaries also landed loans: CountryMark Cooperative Holding Corp. ($350,000 to $1 million) and CountryMark Energy Resources, LLC ($2 million to $5 million).

A loan of between $350,000 and $1 million went to Fluid Recovery Services LLC, a 28-employee operation that provides wastewater services for the oil and gas sector in Pennsylvania and also has a record of environmental mishaps. In 2013, it settled with EPA over a series of illegal discharges of natural gas wastewater at three of its treatment plants. It paid  $83,000 in penalties and committed to spend $30 million to upgrade the facilities.

At least three other corporations with environmental offenses received significant economic relief. 

Pacific Ethanol, a California biofuel company, obtained a loan of $5 million to $10 million, while its subsidiary Pacific Ethanol Pekin LLC got one for $2 million to $5 million. The company has racked up more than $1.4 million in fines since 2005 for dozens of environmental and safety violations at its facilities, according to a database maintained by nonprofit watchdog group Good Jobs First. 

Perma-Fix Environmental Services, an Atlanta-based nuclear and hazardous waste management company that received a $5 million to $10 million bailout, has faced $1.4 million in federal fines for environmental violations, according to the Good Jobs First database.

Performance Diesel, Inc., a Utah-based diesel engine parts manufacturer that took a $350,000 to $1 million PPP loan, agreed last year to pay $1.1 million to settle alleged violations of the Clean Air Act.

With the Small Business Association having approved more than 4.8 million PPP loans, bailout money almost certainly went to other companies with histories of environmental offenses. 

At least one firm, Denver-based oil and gas producer PDC Energy, obtained and later returned a $10 million PPP loan. PDC Energy reached a more than $21 million settlement with EPA and the state of Colorado in 2017 over the uncontrolled release of smog-causing volatile organic compounds from hundreds of the company’s oil and gas tank batteries in the Denver area. Trump’s EPA pointed to that settlement as proof that it is strongly enforcing clean-air violations, the Denver Post reported at the time. 

The Small Business Association did not respond to HuffPost’s request for comment.



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