In California, this is absolutely not the case. Regulations are strict, chemical emissions are heavily restricted and proper disposal of chemicals via specialized companies at great expense. Chemical companies have no need of formulating new versions because everything causes cancer under prop 65. They absolutely have numerous permits for chemicals, your claim that they don't denies reality.

This case probably fell through the cracks, was grandfathered in due to military importance, or is a symptom of the utter lack of industrial knowhow plaguing modern US manufacturing because much US manufacturing is legacy work from decades ago with little ability to modernize, at a plant that likely existing long before the nearby housing.