To avoid bipartisan legislative opposition, State of Michigan strikes backroom deal to award credits to AK Steel without requiring them to clean up their act

LANSING – Today the Michigan Strategic Fund Board awarded AK Steel’s Dearborn Works $20,363,905 in phased out tax credits over the next six years. This agreement was reached after AK Steel failed to gain legislative approval last session for an estimated $55 to $60 million in phased out MEGA credits.

AK Steel’s Dearborn Works is located in Dearborn’s South End, where residents are disproportionately and adversely impacted by harmful air pollution from the surrounding factories and refineries. This area was given a toxicity score by the EPA that was 45 times higher than the state average and Dearborn Works is one of the area’s worst polluters.

Despite some improvements since AK Steel assumed ownership of the plant in 2014 from OAO Severstal, the Dearborn plant continues to violate its air quality permits and receive regular notices from the Michigan DEQ documenting clear violation of air quality protections.

Instead of using this opportunity to pressure one of the state’s biggest violators of air quality standards to clean up its act, the Michigan Strategic Fund Board used a backroom deal to award $20 million in tax breaks to AK Steel, no strings attached,” said Lisa Wozniak, executive director. “Negotiating this agreement without legislative, public, or community engagement defies the basic principles of good governance.”

The Michigan League of Conservation Voters maintained throughout the process that under any agreement with the state, AK Steel should be required to come into compliance or be asked to commit to coming into compliance with all air quality and environmental standards as a condition of accessing the transferred credit.

Michigan created air quality protections so that families would not be expected to breathe dirty, polluted, and unhealthy air,” said Charlotte Jameson, government affairs director. “When our state government chooses not to hold a chronic air polluter accountable for violating our own clean air standards, they miss the opportunity to meaningfully improve the lives of Michigan families.”

Legislators opposed awarding the credits in 2016 over concerns with the financial impact of allowing phased out MEGA credits to continue as well as the poor environmental record of the Dearborn Works plant in question. AK Steel’s facility in Dearborn is chronically in violation of air quality standards to the detriment of the health and wellbeing of the surrounding communities.