Technically it would be a nitrate factory. I mean, is it harmful and bad for a reef, no. But it doesn't really produce nitrate. It does do an excellent job at ammonification and nitrification, but unlike live rock it doesn't help with denitrification. It should not have a bad rap as adding one will not increase your nitrates levels.
Just my two cents. Nitrate factory is not a good term to use. Nitrification factory is more like it.