Maryland regulators want to give nearly $13 million to a private company to help it clean up nutrient pollution from an Eastern Shore chicken rendering plant it owns that has a history of discharge violations.

Officials with the Maryland Department of the Environment said the grant to Valley Proteins, Inc., will help it achieve an extraordinary level of wastewater treatment for such a facility and improve the health of the Transquaking River, a 23-mile-long Chesapeake Bay tributary into which the plant discharges. The river has been classified since 1996 as impaired by nutrients.

Valley Proteins is a chicken rendering plant located east of Cambridge, MD. Credit: Dave Harp / Bay Journal Media

But environmentalists and some Democratic lawmakers object to the state grant, saying that a for-profit firm shouldn’t get public money to clean up its act. State Sen. Sarah Elfreth, a Democrat representing Anne Arundel County, said the proposal “doesn’t pass the smell test.”

“I think they should be paying for it themselves,” Elfreth said, adding that at the very least, the company should borrow the money from the state and pledge to pay it back. “I appreciate that ultimately it will reduce pollution, but I’d like private industry to be paying their fair share.”

Each year, millions of dollars in grants flow out of the Bay Restoration Fund to support projects that curb sewage overflows, retire septic systems and modernize wastewater treatment plants. The recipients are typically cities, towns, counties, and their utilities.

Democratic Sen. Paul Pinsky, chair of the chamber’s environmental committee, criticized the proposal on the Senate floor on March 9, but the Republican who represents Dorchester County, where the plant is located, defended the allocation.

“The reduction of nutrients that we get is very much worth it,” Sen. Addie Eckardt said. “Be careful pointing a finger at some of our businesses. Wastewater treatment is wastewater treatment.”

Maryland lawmakers established the Bay Restoration Fund in 2004 to pay for upgrading the state’s largest wastewater treatment plants to reduce the number of nutrients they discharge into the Chesapeake Bay and its tributaries. The fund is generated by fees levied on every home and business that pipes its waste to a treatment plant and on every user of a septic system that discharges wastewater into the ground.

MDE spokesman Jay Apperson said both private and public entities are eligible for funding. He furnished information on grants totaling more than $3.4 million issued in 2020 to St. John Properties, one of the region’s largest commercial real estate firms. The money paid to connect three business parks and one warehouse in Anne Arundel County to a public wastewater treatment system. The projects had originally been built on septic systems, which are much less effective at preventing nitrogen pollution of nearby waterways.

The Valley Proteins grant, however, would be the first from the Bay Restoration Fund to upgrade a privately owned wastewater facility, the MDE spokesman acknowledged.

Apperson said the Valley Proteins project ranked fifth out of 99 applications considered by the MDE for this year’s round of Bay Restoration funding. The high rating was driven by the project’s potentially large cuts in nitrogen discharges, he explained.

“We believe implementation of [enhanced nutrient removal] at this facility is an innovative and positive solution with clear benefits for clean water progress,” Apperson said.

Troubled history

The rendering plant, in an area east of Cambridge, MD, known as Linkwood, is a kind of last stop along the chicken industry’s production cycle. Each week, trucks offload millions of pounds of feathers, blood and offal, left over after chickens are processed for human food. The plant boils it down into a marketable product: pet food.

The facility operated for more than a half-century before it was purchased in 2013 by Valley Proteins, based in Winchester, VA. The company owns more than a dozen plants in eight states and ranks among the largest rendering companies in the country, with about 2,000 employees and annual sales totaling more than $500 million.

The company is seeking to expand production at the Linkwood plant by 30–50% to keep pace with the region’s growing chicken production, said Michael Smith, Valley Proteins’ vice chairman. That means the plant will have to handle more waste. For the last two years or so, those plans have been under increased scrutiny by environmental regulators and the community.

The plant discharges into a pond that forms the headwaters of the Transquaking River. In 2000, the MDE identified the rendering plant as a major source of nutrient pollution to the river, which snakes through Blackwater National Wildlife Refuge before emptying into Fishing Bay and then the Chesapeake itself above Tangier Sound. At that time, well before its purchase by Valley Proteins, the plant’s wastewater discharge contributed more than one-third of all the nitrogen getting into the river.

The headwaters of the Transquaking River flow near the Valley Proteins chicken rendering facility east of Cambridge, MD.

The MDE ordered reductions in its nutrient discharges in a permit issued in 2000. But over the years, the plant has at times violated that permit.

According to a U.S. Environmental Protection Agency database, the facility amassed “significant” violations of its permit from 2017 through September 2020, and another lesser violation was identified in the last five months. The violations have included repeated failure to report all required discharge data to state regulators and several exceedances of discharge limits on coliform bacteria, organic matter and nitrogen.

The company has been fined a total of $5,000 over the last five years, according to the EPA database.

Smith of Valley Proteins said that most of the plant’s environmental compliance problems date from before his company’s acquisition of the facility or from its early days of ownership, when fixes were still being installed.

Apperson said the plant is currently in full compliance with its pollution permits.

Under pressure from environmentalists and neighbors fed up with the Transquaking’s poor water quality, MDE officials told Valley Proteins two years ago that it would have to significantly reduce its pollution, particularly nitrogen, before it would issue a permit allowing for increased discharge from the rendering plant. The plant’s discharge permit expired in 2006 but remains “fully in force” until the new one is approved, MDE’s Apperson said.

Treating the oily, smelly waste at facilities like the Valley Proteins plant is typically complex, Apperson said. So, federal guidelines allow them to discharge nitrogen at rates up to 100 milligrams per liter of wastewater discharge. The plant’s current system scrubs nitrogen levels to an average of 12–20 milligrams per liter. The new goal is to push that number below 3.

Under MDE guidance, the plant has tested a series of advanced technologies to meet that objective. Smith said it was the agency’s idea for the company to apply for Bay Restoration Fund money to help finance the upgrade, which the MDE estimated to cost $15.4 million. Valley Proteins also will also contribute funds, but he was unable to specify how much, citing ongoing shifts in the design.

“The way I’d look at it, if I were a citizen,” Smith said, “is this is an investment into your future and cleaner water in the state of Maryland.”

Kayakers paddle Maryland’s Transquaking River, with Guinea Island in the background. Credit: Dave Harp / Bay Journal Media

Apperson said the state funding is intended only for reducing pollution loads and not any increase in wastewater use stemming from the rendering plant’s expansion.

Doug Myers, a senior scientist with the Chesapeake Bay Foundation, is a member of the MDE’s advisory committee for the Bay Restoration Fund. He said the MDE presents the panel with lists of projects under consideration for funding, ranked according to their cost-effectiveness in reducing nutrient pollution. He said he did not recall Valley Proteins being presented to the panel during the past year.

Others pushed aside?

Whether that is an appropriate use of Bay Restoration Fund dollars is a matter of debate.

Users of wastewater systems in the Bay watershed pay $60 per year per dwelling unit, which raises about $100 million annually. Fees paid by owners of the state’s 42,000 septic systems raise another $27 million, with that money divided between upgrading those systems to remove more nitrogen and paying farmers to plant nutrient-absorbing cover crops in the winter.

With upgrades of Maryland’s 67 largest wastewater plants nearing completion, the state began several years ago funding improvements to smaller municipal treatments plants. With lawmakers’ approval, it also broadened the fund’s use to include repairs of sewage overflows and connecting communities with failing septic systems to treatment plants.

Any facility that pays into the fee is eligible for funding, Apperson said. He was unable to immediately respond to a Bay Journal request for how much Valley Proteins has contributed to the program since its inception, but he said the state Comptroller’s Office was working on gathering that information.

Community volunteer Bob Sellers pulls a water sample from the Transquaking River in Maryland in 2019. Credit: Dave Harp / Bay Journal Media

Matt Pluta, the Choptank Riverkeeper, an advocacy group active in Dorchester County, contended that the state grantfor the Valley Proteins project is public money that could be spent on another deserving cleanup effort.

“There are a lot of other municipal treatment plants that need to be upgraded,” he said. “We’re rewarding polluters that are polluting our waters when we should be doing the exact opposite.”

Lawmakers debate priorities

The Valley Proteins controversy has become intertwined with heated discussions over a pair of legislative proposals to tap the Bay Restoration Fund for other projects unrelated to wastewater. Combined, the two proposals could draw $25 million a year from the fund to pay for a large tree planting initiative under the Climate Solutions Now Act and for other activities that reduce nutrient and sediment pollution.

MDE officials have said taking that much money from the fund this year would force them to delay upgrades of several smaller wastewater treatment plants. That has upset rural lawmakers representing those affected communities, who have made unsuccessful efforts so far to delay or alter the funding of those two bills.

But activists who support the bills have questioned the $13 million that the MDE has proposed to spend on Valley Proteins, saying the amount of that grant would nearly cover the $15 million first-year cost of the tree planting campaign.

State Sen. Jason Gallion, a Republican representing Cecil and Harford counties, proposed an amendment to the climate bill that would have specified the state could pay no more than half the expense for “cost-effective” upgrades of privately owned wastewater treatment plants. The amendment failed, 16 to 31.

It’s unclear whether lawmakers can or will try to block the MDE from awarding a grant to Valley Proteins. But Elfreth said she was interested in passing legislation next year to bar similar grants to private companies.

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