Growing up in River Rouge, Ebony Elmore remembers seeing thick gas clouds form in the sky every time it would rain.
No matter the weather, there was a constant smell in the air from the heavy industry near her house.
The community, just 10 miles southwest of Detroit, was once home to the Ford River Rouge complex, the largest factory in the world. It was an industrial magnet that became a symbol of neglect in the Great Lakes state. Companies belched smoke into the skies and dumped chemicals unabatedly into the Detroit River and its tributary, the Rouge River. In 1969, the Rouge River hit an environmental low when the oil and industrial waste in the waterway caught fire, with flames reaching as high as 50 feet.
Just a few years earlier, state lawmakers passed the Air Pollution Control Exemption with the Air Pollution Act of 1965. The goal was to incentivize Michigan companies to stop polluting by exempting them from paying property and sales taxes if they installed equipment to reduce pollution. It’s a policy that states around the country also adopted.
But today, some of the first River Rouge companies to receive those incentives continue violating air quality laws, and still get tax breaks – a trend that plays out across the state, but is especially acute in this downriver community.
Elmore said she didn’t realize the law existed.
“I don’t really see the laws in effect when I’m living the life out here near the actual facilities, because it’s always just the pollution – it doesn’t look better, it doesn’t feel better to us,” said Elmore.
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Many of her nieces and nephews had breathing issues living in River Rouge, Elmore said, prompting her relatives to move out of the city. “It’s really hard to breathe around here.”
Over the last decade, these exemptions have cost the state nearly $2 billion in taxes, according to a BridgeDetroit review of Michigan Department of Treasury online records and state Air Quality Division inspection reports. These same properties have been issued dozens of air quality violations during that time. It’s difficult to say how many violations the exempted facilities have received due to inconsistent records.
Meanwhile, the environmental benefits of the law aren’t tracked by the state, which also cannot confirm that the program is reducing emissions. Some policy advocates and elected officials are calling for a repeal of the law, like some other states have done with similar programs.
“I can’t imagine how a regulatory authority keeps track of these things, but it seems regulation is so split up that no one cares about the big picture of these facilities,” said Alex Hill, a data expert, community researcher and founder of open portal Detroit Data.
Keeping in compliance
Take, for example, DTE Energy and its subsidiary EES Coke Battery LLC, which were exempt from a portion of their taxes to control pollution in River Rouge dating back to 1979 and 1967, respectively. DTE operated a coal-fired plant in River Rouge until 2021.
A DTE spokesperson said that even with the savings, “DTE continues to be one of the largest property taxpayers in many Michigan communities, helping support schools, roads and other essential local services.”
EES Coke still has a facility that converts coal into a material called metallurgical coke, which is used in steelmaking.
In 2015, EES Coke signed a legal enforcement order to address a number of air quality violations and had to pay $95,000 in fines to the state’s general fund. Since then, EES Coke has accumulated 19 more air quality violations. In 2022, a complaint was filed in federal court against EES Coke by the U.S. Environmental Protection Agency, alleging the company put the health of residents at risk by emitting more sulfur dioxide than permitted. In 2024, DTE, which had its own violation for failing to continuously monitor emissions, was added as a defendant.
A report in Planet Detroit notes that Industrious Labs, an advocacy group for clean industry, claims that EES Coke and DTE could be responsible for an estimated 29-57 premature deaths and more than 15,000 asthma cases annually in the area.
EES Coke’s most recent violation was in June for exceeding visible emissions. Still, a week later, the Michigan Department of Environment, Great Lakes, and Energy (EGLE) issued the company a new permit to install a secondary screener that will emit an additional 2.65 tons of pollution a year. In November, President Donald Trump signed an order authorizing a two-year exemption from coke oven pollution rules for EES Coke, among other facilities nationwide. The rules were enacted during the Biden administration.
EES Coke Vice President David Smith said by email that the company is operating in full compliance with the EGLE permit they were issued.
“EES Coke has complied with all regulations governing the site at the state and federal level that protect public health,” Smith said. “We remain committed to responsibly operating under those regulations while our plant serves a critical function, producing coke to fuel the steel industry and supporting more than 170 jobs in the community.”
Despite the ongoing issues, EES Coke and DTE kept their property tax exemptions, amounting to a loss of $27 million in tax exemptions between 2013 and 2021, or roughly $4,000 per River Rouge resident over the same period, according to Good Jobs First, a nonprofit that researches tax incentives and generally opposes them.
EGLE confirmed EES Coke was issued two exemptions in 2016, but Smith said EES Coke is not currently utilizing an exemption.
EGLE says it doesn’t have the capacity to review exemptions for air quality compliance, so it has not revoked any certificates. It does, however, continue to issue them.
No revoked exemptions
Former Good Jobs First researcher Jacob Whiton conducted a multi-year case study of the effects of the law on the state and River Rouge.
He found that the law has cost the majority Black city, where nearly 40% of residents live in poverty, roughly a quarter of its property tax revenue. His analysis also revealed that many users of the tax exemption are some of the worst violators in the state, like DTE and Marathon Petroleum. Marathon did not respond to a request for comment.
The state has never revoked a tax exemption in the history of the law, state authorities said, and EGLE does not consider past violations when issuing new emissions permits.
“What is actually the point of offering this [exemption] in the first place? Is it to improve environmental compliance? Because the biggest beneficiaries are in fact the biggest polluters in the state,” he said.
An EGLE representative said the emissions reductions can be duplicative in some cases, where companies are eliminating pollution they’re required to anyways for their permits to operate.
“The intent of the Act and the regulation really was to improve our air quality and incentivize companies to install air pollution control equipment. But… it’s a very old program,” said Chris Ethridge, assistant director at the Air Quality Division of EGLE. “The rules and regulations have changed substantially since [1965], and the likelihood of a facility installing air pollution control equipment that’s not required by permit or regulation is much less than it would have been when this program was enacted.”
The exemptions are issued by the State Tax Commission following a recommendation by EGLE. The law allows the tax commission to revoke a certification under several conditions, including if there is “substantial noncompliance” with the Air Pollution Control Act. EGLE tracks when these violations occur, but EGLE officials told BridgeDetroit the department doesn’t have the resources to monitor compliance for the program.
In the last decade, the department has issued roughly 2,735 violation notices to 1,097 corporations across 417 municipalities, according to an analysis by Detroit Data, a collaborative open data portal with 1,500 datasets. Over 75% of the violations occurred in Detroit and Grand Rapids.
Additionally, repeat violations and legal enforcement orders aren’t necessarily grounds for revocation, according to EGLE.
“It’s conceivable that a company could have had significant noncompliance and then had those issues resolved and now would be considered compliant,” said Ethridge.
When asked about issuing certificates in perpetuity to repeat violators and the benefits of the law, a representative for the State Tax Commission said the commission was just following the law.
“We implement the state law as written,” said Michigan Department of Treasury spokesperson Ron Leix by email. “The issues raised are better directed to the Legislature.”
Nick Leonard, executive director at the Great Lakes Environmental Law Center, said it’s unlikely that a certificate would ever be revoked.
“Even if EGLE could solve its supposed resource constraints, it appears to have such a narrow reading of what amounts to ‘substantial noncompliance’ that it would never recommend revoking a certificate,” he said by email.
But Leonard said the laws, as written, allow the departments to revoke certificates.
“Contrary to EGLE’s interpretation, the law doesn’t require the noncompliance to be ongoing and unresolved to revoke a certificate,” he said. “These certificates are benefits that companies may receive if they comply with the law; they shouldn’t be held by habitual violators.”
Is it helping the environment?
The environmental benefits of the exemptions are unclear.
Ethridge said he couldn’t share information that “demonstrable emissions reductions have occurred as a result” of the exemptions. A review of environmental benefits isn’t part of EGLE’s responsibility under the law, but, he said, “There’s no harm in a company installing air pollution control equipment from a health perspective.”
Consumers Energy, one of the biggest users of the exemptions, according to Good Jobs First, said it voluntarily controls more pollution than required at its exempted facilities and has saved billions of gallons of water.
“We also maintain landfill avoidance and land protection goals, along with a company-wide commitment to achieving net-zero greenhouse gas emissions by 2050,” spokesperson Trisha D. Bloembergen said by email.
She said the exemptions are a financial tool – by lowering the cost of pollution control investments, Consumers can pass along savings to customers.
In June, Consumers Energy asked the Michigan Public Service Commission for an electric rate increase totaling $436 million. Michigan Attorney General Dana Nessel’s office intervened, saying the proposed rate hike was “likely the largest in decades” and called for more just rates. Nessel also is opposing a December request from Consumers to increase natural gas rates 8% for residential customers, less than three months after the MPSC approved its request to increase natural gas rates by $157.5 million.
Consumers Energy sells electricity to approximately 1.9 million customers and natural gas to 1.8 million customers across the state.
Stellantis N.V., formerly FCA, has exempted equipment at facilities in Auburn Hills, Detroit, Sterling Heights, Rochester Hills and Warren, according to EGLE.
Stellantis spokesperson Jodi Tinson said the tax exemption has no bearing on the company’s air emissions permit or environmental requirements and does not affect operational standards, which are governed by existing emissions laws.
Stellantis has had 19 violations and three administrative consent orders in the last decade at its exempted facilities for operating equipment without a permit, strong odors and pollution above allowable emission limits.
Legislative considerations
State Sen. Stephanie Chang (D-Detroit) represents several cities where Stellantis has utilized the exemptions. She said it is “a problem” that communities are getting worse air quality and less tax revenue.
“It’s quite disappointing that some companies who have received air pollution control exemptions have had a history of air quality violations, when the point of the tax exemptions is to improve public health, not worsen it,” she wrote by email. “Only companies who meet air quality standards and follow their permits should be eligible for these kinds of exemptions.”
Chang said she hopes the law can be revisited to prioritize public health.
Several pieces of legislation are being floated in Michigan that would increase polluter accountability and create an opportunity to reevaluate the exemption law.
Ben Poulson, state government affairs director for the Michigan League of Conservation Voters, said there’s been a push in the Legislature to make sure taxpayer money is being spent efficiently.
“This [exemption law] is a piece that’s come under fire by some advocacy groups before, in terms of potentially being a waste,” he said.
In June, Democratic lawmakers announced they would try again to pass “polluter pay” laws, which create stricter pollution reporting and cleanup requirements, among other proposals. The legislation passed the Senate but didn’t go for a vote in the House.
Sen. Mary Cavanagh (D-Redford Township), chair of the Finance, Insurance, and Consumer Protection committee in the Michigan Senate, said that the law isn’t currently being discussed in the Legislature, but it’s something she is interested in talking about.
“We are doing polluter pay laws and hazardous waste … property taxes against air pollution and abatement – I know that’s directly impacting schools, so I’d love to look into it and see where it left off,” Cavanagh said.
If plans advance, Michigan wouldn’t be the first state to repeal a pollution control tax exemption law.
Louisiana temporarily paused its tax exemption for pollution control devices in 2016 and repealed it at the beginning of 2025 amid a number of repeals to increase revenue. A spokesperson for Louisiana’s Department of Revenue said it didn’t have any information related to the law or its repeal.
Mike Johnson, executive vice president of government affairs and workforce development for the Michigan Manufacturers Association, cited a 2014 ballot proposal approved by Michigan voters that eliminated personal property tax on manufacturing equipment.
He said this made the pollution control tax exemption law effectively irrelevant. He also said it’s “odd” to tax equipment that is required by law.
“We need to make sure that Michigan manufacturers can compete from their Michigan location with our competitors across the country and around the world,” he said.
A broader shift in environmental oversight is underway. A Trump administration order last year to exempt key Michigan facilities, including iron ore mines in the Upper Peninsula and a plastics plant in Midland, from stricter federal air pollution rules has raised concerns among environmental advocates. They say it mirrors state-level loopholes that reward companies despite long records of violations.
Together, state tax breaks and federal regulatory rollbacks are reshaping the manufacturing landscape, offering incentives without demanding accountability, environmental advocates say. For communities like River Rouge, where air pollution has long been linked to health disparities, the stakes remain high.
Elmore, whose stepfather retired from a job at EES Coke, like a lot of other River Rouge residents who worked on Zug Island, said the community was built and sustained by the industry. For more than 100 years, Zug Island, a 334-acre private site in River Rouge, has employed many local residents for its heavy industry uses, and is just one of a few places across the country that produces coke, which is used to make steel.
“But all we’ve got in return is a bunch of abandonment and sickness,” she said.
Elmore supports repealing what she describes as the “bare minimum” law. With the extra taxes River Rouge could be getting from the companies, she said she’d like to see support for legacy homeowners, or for the funds to go to reductions in chronic absenteeism at the schools or lead in the pipes.
“A lot of these children over here are missing days of school because of their asthma and their health issues,” she said.
This project was an initiative of the Kozik Environmental Justice Reporting Grants funded by the National Press Foundation and the National Press Club Journalism Institute.
Methodology: To determine the amount of lost property taxes exemption certificates from the Michigan Department of Treasury online reportswere used. Each certificate lists the cost of the equipment exempted. Using the initial assessed value of the equipment and the depreciated value over time according to the state’s Machines and Equipment schedule a local millage rate for where each facility is located was applied to the equipment values. Violations were calculated by using Shelby Jouppi’s dataset that organizes data published online by the Michigan Department of Environment, Great Lakes, and Energy. The addresses listed for exempted facilities were matched to the addresses where air quality violations occurred. Isabella McLaury, and Ted Tansley and Alex Hill of DETROITography.com contributed to this report. The text was fact-checked by Jeremy Verdusco. Graphics are provided by Matt Daniels.