The state allows a portion of fines to be directed to projects that remediate environmental harm. Some of those projects benefit the companies that are being penalized.
Refinery complexes along the Houston Ship Channel. Credit: Michael Stravato for The Texas Tribune
By Amal Ahmed for Floodlight
After a Taiwanese plastics and petrochemical company leaked harmful gasses from its chemical plant in the Gulf Coast town of Point Comfort in 2021, Texas’ environmental agency fined it nearly $267,000. Instead of paying the entire fine to the state, Formosa — which uses fossil fuels to create plastics — sent half the money to the Texas Natural Gas Foundation, a nonprofit entity that promotes natural gas to the public.
Texas state law allows polluters to divert some of their fines that normally go to the state’s general revenue fund to “supplemental environmental projects,” or SEPs. The Texas Natural Gas Foundation has qualified as an SEP since 2016.
In theory, SEPs are meant to remediate industrial pollution and environmental harm by funding programs like cleanups at illegal dump sites, habitat restoration or household hazardous waste pickups in communities.
Public documents obtained by Floodlight show that SEPs like the one with the Texas Natural Gas Foundation can directly benefit the companies that are being penalized — by paying to staff and run industry programs.