Perdue AgriRecycle processes raw chicken manure and makes it into an organice fertilizer. (Lloyd Fox/Baltimore Sun video)
In one end of the long green warehouse come heaps of powdery, malodorous chicken manure. Out the other goes garden-ready fertilizer sold to golf courses or companies like Scotts, which bag it and market it as Miracle Gro Organic Choice and other products.
Supporters say the Perdue AgriRecycle facility a few miles from the Maryland state line is one solution for chicken farmers on the Eastern Shore who need to get rid of manure.
Along with the chicken litter, the Perdue facility receives hundreds of thousands of state taxpayer dollars each year. A state program reimburses farmers, brokers and poultry companies for half of their costs to haul manure around Delmarva and beyond. Perdue is one of the largest beneficiaries.
The company gets up to $18 per ton to have its processed fertilizers trucked out to market. Other grant recipients include one large Delaware manure brokerage and farmers scattered across the state.
Maryland will likely spend more than $1 million this year on the program, and some expect the payouts to increase as restrictions to protect the Chesapeake Bay tighten. Animal waste is blamed for more than a third of the nitrogen and more than half of the phosphorus that pollute the bay. State regulations limit the amount of manure farmers may spread on their fields.
The bill nearly hit seven figures for the first time in the fiscal year that ended in June, according to state data provided to The Baltimore Sun through a public records request. Nearly half of it went to the Perdue facility and to the Delaware broker Ray Ellis, who said most of his grants went toward shuttling manure to Pennsylvania mushroom farms.
A growing portion also goes to help dairy farmers haul cow manure and inject it into the soil. Unlike chicken litter, cow manure is largely liquid, making it heavier and also more prone to washing into waterways. But farmers use far less cow manure as fertilizer, making it less of a concern.
Environmentalists credit the subsidy program with reducing bay pollution. But some ask why the state is spending taxpayer money to subsidize private businesses when the funds could go directly toward other cleanup efforts.
"Other industries aren't afforded these types of subsidies," said Katlyn Clark, a legal fellow with Waterkeepers Chesapeake. "Manure is an unavoidable consequence of growing, raising, and selling chickens — yet, larger chicken companies have essentially placed this burden on taxpayers and growers of the chickens."
Grant recipients say they need the subsidy to help defray the cost of helping farmers comply with tightening restrictions on runoff to the bay.
Manure is a valuable commodity as a free and organic byproduct of chicken farming, they say, but policies enacted to protect the bay have made the litter more of a problem that farmers are still figuring out how to solve.
Perdue says its Delaware facility receives 50,000 tons of manure from across the Delmarva peninsula each year.
Officials with the Salisbury-based company say it doesn't profit from the operation; instead, they called it "a solution" for farmers who need the company's support.
"I think the industry pays their fair share and this is something that comes back to the industry," said Steve Levitsky, vice president of sustainability for Perdue Farms. The AgriRecycle facility received $232,000 through the program last year.
The state began subsidizing the cost of transporting manure in 1998, shelling out $18,000.
Costs hit $954,000 in 2016, when tonnage surged above 200,000 for the first time.
Norman Astle, who oversees the program for the Maryland Department of Agriculture, said the program could run out of money this year for a second straight year.
Those who work in the poultry industry say a combination of factors have caused demand to grow.
They cite new data and regulations that are limiting how much manure can be spread on fields on the lower Eastern Shore; an increasing number of farms on which chicken houses cover the entire property, leaving no cropland on which to spread manure; and a possible increase in how often farmers are having chicken houses cleaned out.
James Fisher, a spokesman for the trade group Delmarva Poultry Industry Inc., emphasized that farmers and chicken companies are sharing in the transportation costs.
Fisher defended the use of chicken litter as fertilizer.
"It's locally produced, organic slow-release plant food," he said. "These are not products that are chock-full of nitrogen and phosphorus, but they have an impact."
State agriculture officials said the program has helped clean up the bay. Recent reports have shown blue crab abundance, underwater grass growth and water quality at their highest levels in years.
"A recent report from the Chesapeake Bay Foundation shows that bay health is improving for the first time since 1998, and I think our farmers have had a lot to do with these results," the officials said in a statement.
Environmental groups do not disagree. But some say gains in water quality could partially be the result of below-average precipitation in recent years, only temporarily limiting the load of nutrients washing into the bay.
Nitrogen and phosphorus feed algae blooms that block sunlight from reaching other marine flora. When those blooms die and decompose, they strip the water of oxygen fish and shellfish need to breathe.
Some have asked why the state should pay for the program. A group that called itself the Maryland Clean Agriculture Coalition pushed for legislation last year that would have shifted all responsibility for removing poultry manure to companies like Perdue, Tyson and Mountaire.
"While the Manure Transport Program has kept a large amount of manure off the Eastern Shore," Clark said, "the financial burden should rightfully be on the industry that creates it."
In the current fiscal year, $357,000 of the state money spent on manure transport comes from general state tax receipts, and $750,000 comes from the state's Chesapeake and Atlantic Coastal Bays Trust Fund. That account is filled with revenue from the state's gasoline and rental car taxes, and is spent on a variety of programs designed to reduce pollution from widespread fertilizer use and other contaminants swept up by rainwater.
Poultry companies, manure brokers and farmers contribute $527,000 for their part.
Maryland is not the only state to use taxpayer money to move manure around. Delaware spent $246,000 of federal and poultry industry money to transport about 52,000 tons of poultry litter in 2015, spreading it on fields across the state and elsewhere, and delivering it for "alternative" uses.
The Delmarva Land and Litter Challenge, a task force that includes representatives from state and local governments, the poultry industry and environmental groups from across the peninsula, is working to figure out a long-term solution for the region's abundance of chicken waste.
Users of Maryland's program have suggested it could be made more like Delaware's, which requires significantly less paperwork and documentation.
But before any changes are proposed, farmers and environmentalists are working to more precisely define any problems.
State agriculture officials say they do not plan to seek more money for the program. They're focusing instead on finding alternatives to spreading manure on fields — anything from mushroom farms to waste-to-energy technology like anaerobic digesters, which can turn manure into a gas that can be burned as fuel.
"This program is not a long-term solution," they said in the statement. "As alternative-use technology becomes more proven and accessible, the demand for the transport program will decrease.
"Until then, it remains a necessary component of our conservation efforts."
But with manure restrictions expected to tighten as a 2025 Chesapeake cleanup target approaches, Ray Ellis, the Delaware manure broker who received $223,000 in grants in the state's most recent fiscal year, expects the need for the program to endure.
"There's going to be beaucoup manure to be transported compared to what's being transported now," he said.
An earlier version of this story misidentified Steve Levitsky, vice president of sustainability for Perdue Farms. The Sun regrets the error.