PROVIDENCE — For four years, homemaker Gina D’Ambra has had to close all the windows and quarantine herself at home because of air pollution from the Bradford Dyeing Association.

D’Ambra, whose backyard abuts the textile finishing plant in Westerly, said she developed a chronic cough her lung specialist couldn’t cure. She also has to use air ionizers every day to purify her Bowling Lane house.

“The smell of the chemicals they use there, there’s a strong vinegar smell and a rotten egg smell and burning rubber,” said D’Ambra, 39. The only time the odors stop, she said, are Sundays and two weeks in the summer when the plant is closed.

Her neighbor, dog groomer Lisa Emery, 35, said the smell resembles “a city dump” and it makes her family of four nauseous. “It’s pretty bad,” she said. “It’s to the point where we don’t go outside at all. I don’t invite company because of the fear of the smell.”

Bradford village residents such as D’Ambra and Emery hope to soon be able to breathe easier. Under a lawsuit settlement finalized this week, Bradford Dyeing Association will make several facility upgrades and pay $150,000 for past air and water violations.

Half of the money will create a new fund for environmental projects to improve air and water quality in Bradford and the Pawcatuck River. The rest will pay for a new burner and gas-recirculation system to reduce greenhouse gases.

The settlement, signed by U.S. District Judge Ernest C. Torres on Monday, requires the plant to upgrade its boilers and burners to reduce soot, heighten its smokestacks, improve the management of sludge ponds to reduce sewer odors, and install a new control device to reduce smoke and odor emissions.

Bradford Dyeing Association must hire consultants to monitor its wastewater discharges and smoke emissions and create monthly reports on the factory’s progress. If the company fails to meet air and water pollution standards, it faces fines ranging from $500 to $2,500 per violation.

Bradford Dyeing Association has 210 employees and finishes camouflage fabrics used by the U.S. Department of Defense for military uniforms. The company was founded in 1911 and runs a 500,000-square-foot facility along the banks of the Pawcatuck River, the boundary between Westerly and Hopkinton.

Gregg Perry, a Bradford spokesman, said the company is already following state and federal regulations and has always taken its responsibility to the environment and neighbors seriously.

Perry said many of the upgrades are already in the works and would probably cost hundreds of thousands of dollars. Perry also said the company spent $2 million in water and air treatment system upgrades over the last 10 years and it continues to spend $250,000 annually on the water systems.

The federal lawsuit was filed in August 2005 by advocates from Environment Rhode Island, the Rhode Island chapter of the Sierra Club and the regional Toxics Action Center.

According to the lawsuit, Bradford Dyeing Associates emits about 1 million pounds of pollutants into the air each year. Some of the pollutants listed in the lawsuit include lead, nickel, acetic acid, acetone, sulfur dioxide, carbon monoxide and nitric oxide. The suit also claimed the factory discharged illegal amounts of copper, excessive levels of fecal coliform bacteria and other substances into the Pawcatuck River.

Neighbors of the factory have complained for years. In 2004, the company got a “Dirty Dozen Award,” which is given to 12 of New England’s top polluters by the Toxics Action Center.

Bradford resident Emery hopes all the settlement terms will come to fruition. “I’m hoping they will work out and things will straighten out and everybody can coexist, the factory and us,” she said. “We don’t want them to leave. We just want clean air and water.”

At a news conference yesterday in Burnside Park, across from the U.S. District Court House, environmentalists applauded the settlement as a “victory” and called for more pollution enforcement from the state Department of Environmental Management.

“This is a great settlement for this case, but it’s just one,” said Matt Auten of Environment Rhode Island. “We need to know if there’s others out there. At the end of the day, DEM should be enforcing these laws.”

While DEM Director W. Michael Sullivan declined to comment on the lawsuit settlement, he said Bradford Dyeing Association has been responsive to all past violations and fixed the issues.

Since 2000, the department has conducted four air inspections at the plant and responded to 90 odor complaints, according to Gail Mastrati, DEM spokeswoman. The company received six violations in 2004 and paid $4,000 in fines. The company was found to be in compliance with water regulations during two 2004 inspections.

Sullivan said the department has experienced many budget and staff cuts and currently has two air inspectors for the entire state. However, he plans on increasing the attention paid to environmental impacts and assessments in the future. “We take this as a polite reminder of our responsibilities,” he said.

Michelle J. Lee is a fellow with the Metcalf Institute for Marine and Environmental Reporting Institute.