Can county governments run their own recycling operations and actually make money?
The answer depends on the county.
Last year, according to the Solid Waste Administration, Palm Beach County brought in around $8.5 million collecting and then reselling residents’ and businesses’ trash. Some of the most lucrative dumpster diving took place at Wal-Mart and Publix stores.
But to reach a profit, officials must face what private businesses deal with everyday: risk. In this case, it’s the dreaded “diversion rate” — a measure of how much recyclables are being collected versus how much ends up being used.
A recycler takes a hit when reusable trash ends up being too contaminated and must be hauled off to a landfill. The price consumers will pay for a recycled product is also uncertain.
“We haven’t lost anything (money), but we operate our own landfill,” said Sandy Lee, director of solid waste management in Palm Beach County.
But not all Florida counties operate the same way.
Most solid waste collection and processing in the state is performed by a handful of private recycling firms. But that doesn’t guarantee a good deal for taxpayers.
According to a report issued by the University of Miami, private firms have different financial objectives and lack the institutional transparency required of public enterprises.
The money trail
Counties also differ in how they operate recycling programs.
In most counties, recycling is required by local law, but at a cost to residents. Fees can run anywhere from $25 to $500 a year. Costs are usually passed on to homeowners either as an add-on to their monthly garbage fee or as a lump sum on their property tax statements.
In Miami-Dade, Broward, St. Lucie, Martin, Ockechobee, Palm Beach, Collier and Lee, among others, residents are required to use bulky green collection bins. That charge is added to sewer and water bills.
But any profit made from selling recyclables typically goes back to the private companies under contract. Residents don’t recoup a dime.
Watchdog.org reviewed several county contracts involving Waste Pro, Waste Management and Treasure Coast Refuse, three of the largest waste management firms in the country.
According to St. Lucie County’s contract with Waste Pro, “the contractor shall at all times hold title and ownership to all recyclables materials collected by contractor” and “shall retain the revenues obtained from its recyclables and equipment.”
Okeechobee County’s contract with Waste Management also tilts to the contractor.
“The contractor shall be entitled to all revenues generated from the disposition of the recovered materials and shall also be responsible for all charges associated with said disposition.” In this case, the silver lining is that the firm doesn’t charge homeowners for recycling.
The city of Fort Pierce in St. Lucie County, takes care of its own garbage. But this year the city initiated a recycling contract with Waste Management that includes profit sharing from the sale of recyclables.
In Indian River County, Treasure Coast Refuse Corp. and Waste Management are the main players. Residents pay for the recycling program, and the county pays for blue and green trash bins.
“We collected 11,254 tons of recyclables and we made $410,453 in 2012 calendar year,” said Himashu Mehta, managing director of Indian River County’s solid waste disposal district.
In Lee County, almost half a million tons of material is recycled annually, according to Lindsey J. Sampson, director of the county’s Solid Waste Division. But most of the material was recycled by private companies, so there’s no firm figure on exactly how much waste was saved from the landfills.
At the county-owned recycling facility, about 68,000 tons of material was received, of which 80 to 85 percent was recycled. The remainder, if combustible, is shipped to the county’s waste-to-energy plant where it is burned.
In Miami-Dade, the state’s most populous county, 13 of the 35 municipalities participate in recycling.
Miami-Dade Mayor Carlos Gimenez said fiscal year 2011-12 was the most successful in the program’s four year history with $720,568 in revenue received from 62,997 tons of recyclable material. However, the the Florida Department of Environmental Protection shows 1,826,184 tons were recycled.
DEP told Watchdog.org they do not keep track of the diversion rate — the amount of recyclable material collected and the amount actually recycled — the only performance indicator for recycling.
In fact, Watchdog.org could not find any meaningful measure showing a positive return on investment from recycling programs. That’s surprising for a state with so much mandated recycling and a 75 percent recycling target rate.
Dawn McCormick, a spokesperson for Waste Management said that’s because cities and counties can have different contracts. “It’s important to compare apples with apples,” she said.
“It is true in same cases (local governments) keep the profit of the selling of those commodities, and in other cases we share the profit with the municipality,” McCormick said. “But cities negotiate those contracts for the best benefit of their residents.”
Published with permission from Watchdog.org.
William Patrick contributed to this story.
Contact Marianela Toledo at [email protected] twitter @mtoledoreporter
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