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South Chicago, East Side

City Shouldn’t Be Punished For Letting Metal Shredder Move To Southeast Side, City Lawyer Tells Feds

City lawyers said the health department won't issue Reserve Management Group's final permit to open a scrapper until at least Jan. 19.

Scrap metal is brought to General Iron Industries’ Lincoln Park facility on Friday, August 14, 2020. | Colin Boyle/Block Club Chicago
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EAST SIDE — The city is arguing Southeast Siders’ claims of housing discrimination related to General Iron’s exit from Lincoln Park are “unfounded,” and the federal government has no standing to ask the city to withhold permits from the metal scrapper’s owner, a top city lawyer said.

Attempts at mediating a federal fair housing complaint filed by residents in August — which alleges the city has deepened segregation by clustering polluting industry on the Southeast Side — would be “inappropriate, or at least premature” until the city formally responds to the complaint, Deputy Corporation Counsel John Hendricks wrote in a letter to federal officials Friday.

The city plans to formally respond in December, about four months after the complaint was filed.

Despite its issues with the complaint, the city will not issue RMG an operational permit until at least Jan. 19 as officials review the company’s permit application, Hendricks wrote.

Hendricks’ letter to the U.S. Department of Housing and Urban Development comes after the feds’ request earlier this month that the city withhold Southside Recycling’s operational permit for 11600 S. Burley Ave. until the complaint is investigated.

Federal officials found the residents’ argument — that Southside Recycling’s operation would cause “serious and irreparable injury” to nearby neighborhoods — to be “persuasive,” Midwest fair housing director Lon Meltesen wrote Nov. 10.

But Hendricks, the city’s attorney, argued the complaint’s allegations “lack any merit” as General Iron is “not moving to the Southeast Side,” according to his letter, which came three days after Meltesen’s requested deadline.

Echoing RMG officials’ comments during a recent tour of the planned Burley Avenue site, Hendricks wrote RMG will install a “state-of-the-art” shredder in East Side if permitted, while noting the Labkon family’s 2019 sale of General Iron to RMG and the planned facility’s location a half-mile from the public way.

Essential equipment and most existing employees will make the move from Lincoln Park, and the Labkon family maintains a minority stake in Southside Recycling.

The application was filed Nov. 13, Hendricks wrote. That’s three days after Meltesen’s request to withhold permits.

Jordan Troy, a spokeswoman for Mayor Lori Lightfoot, announced the application’s receipt late Nov. 17 and did not respond when asked if the application had been filed that same day.

RMG spokesperson Randall Samborn declined last week to clarify when RMG filed its application, directing all questions about the permit process to the city.

Information about the community engagement process around the permit application was to be available by the end of last week, Troy said. No details were posted to the city’s dedicated RMG website as of Tuesday afternoon.

After health officials quietly issued RMG the first of its two required permits despite promises of transparency, the city again pledged to “provide more prompt, thorough community notifications of new activity” around the permit process.

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