Southside Recycling files motion to enforce administrative law judge’s ruling

General III LLC (dba Southside Recycling, or SSR) filed a motion July 18 to enforce Administrative Law Judge Mitchell Ex’s June 1 ruling vacating the city of Chicago’s February 2022 denial of a large recycling facility (LRF) permit that the company needs to begin operating its auto shredder yard. The yard is along the Calumet River on a 175-acre parcel of land that Southside Recycling’s parent company, Reserve Management Group (RMG) of Stow, Ohio, owns. The larger site also is home to other RMG-owned businesses, including Reserve Marine Terminals, Napuck Salvage of Waupaca, South Shore Recycling and Regency Technologies.

In addition to the motion to enforce the ruling, Southside seeks to hold the city in contempt for failing to issue the permit.

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In the filing, SSR says, “CDPH [Chicago Department of Public Health] has repeatedly refused to follow the law and issue the permit and is now refusing to comply with an order requiring it to do so.”

The memorandum that accompanied the filing goes on to say that the city must “follow the law and the standards it has set” by issuing a permit when a party meets the standards it has set for its issuance rather than changing the rules and standards or ignoring its own administrative process.

“As an initial matter, in contravention of its own guidelines, CDPH took 15 months—nine months longer than the required timeframe in its own guidelines—to even act on SSR’s permit application. Second, in February 2021, CDPH denied the permit and informed SSR that it could challenge that denial by requesting a hearing before the Chicago Department of Administrative Hearings (DOAH),” which the company did.

Following Judge Ex’s ruling June 1 vacating CDPH’s denial of the permit after finding that SSR met all requirements for issuance of the permit, CDRH filed a complaint June 30 seeking to overturn the order. SSR says the CDPH has taken “the incredible position that the only effect of the ALJ’s order is for the case to stand as if no decision to deny ‘had ever been made,’” which in effect “renders the entire DOAH proceeding meaningless.”

In the memorandum, SSR adds that now that the time to seek review of the ALJ’s order has expired and CDPH has failed to comply with the order and issue the permit or seek a stay of that order, it is in violation of the ALJ order.

“This facility should be the showpiece for the community and environmental organizations and not the pariah the city has made it out to be,” SSR writes in the memorandum accompanying the motion. “Metal recycling is a vital function in Chicago and throughout the world. Furthermore, the SSR facility is equipped with the most advanced pollution control system of any metal shredding facility in the country. The pollution control system in place at SSR [is] the same controls that the U.S. EPA has recommended.”

The facility features a European-style shredder enclosure to better contain noise and emissions. It incorporates a regenerative thermal oxidizer and wet scrubber to address the release of volatile organic compounds. The shredder also features a suction hood and high-efficiency filters to capture metals and particulate matter. The Southside Recycling operation also features an on-site wastewater treatment plant and air monitors to measure emissions 24/7 once the business is running.

The SSR saga dates back to 2018, when RMG struck a preliminary deal with the Labkon family to buy General Iron’s assets, which were based in Lincoln Park on the north side in a gentrifying neighborhood, and built a new facility on RMG’s existing property on the south side of Chicago. In 2019, following Lori Lightfoot’s election as mayor, RMG, General Iron and the city signed an agreement in September that enabled the continued operation of the Lincoln Park site until the end of 2020 and outlined how the city would “reasonably cooperate with RMG in achieving the efficient, expeditious transition of the business to the Southside properties, including reasonable assistance with processing and review of license and permit applications.”

The decision to deny the LRF permit, which SSR applied for in November 2020, was reached following an analysis that the U.S. Environmental Protection Agency (EPA) recommended to assess the environmental justice implications and potential environmental and health effects of the proposed facility. The CDPH conducted the analysis.

A spokesman for SRS says the company’s lawsuit for damages against the city remains pending but on hold as a separate case.