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The Wheels Come Off The Recycling Cart: Projected Collections Down 40 Percent & Recycle Ann Arbor On the Ropes Financially

A2Politico has been consistently critical of the city’s move to single-stream recycling, interviewing and quoting national experts who dubbed the move “environmentally regressive” and a “waste of taxpayer money.” A2Politico questioned the rosy collections projections of city staff, consultants and local politicos who used their support of single-stream recycling in the 2010 City Council and Mayoral campaigns. A2Politico wrote in a January 28, 2010 entry:

Is single stream better for you? Of course. Throwing everything that’s recyclable into the same container is right up there with the delicious evil pleasure of leaving your socks on the floor, and having someone come along and pick them up. Single stream recycling is like a night in The Big Easy. Lots of feeling good.

There’s just one little problem associated with living it up, and that’s the hangover. With respect to single-stream recycling, more compliance actually leads to problems. According to the same 2007 study done by the California Department of Conservation, “However, the introduction of single stream collection systems has not had such uniformly positive results for recycled product manufacturers. Instead, it has accelerated an already pronounced slide towards poorly sorted recovered materials, with glass, plastics and metals being delivered to paper mills in bales of fiber, the wrong types of fiber going to paper mills that can only use specific grades, and increased contamination, as well as materials lost to plastics, glass and aluminum manufacturers. Recyclable materials that were recovered for recycling in community programs but then sent to the wrong types of manufacturers generally end up in landfills….”

At the moment, single stream recycling actually leads to more materials ending up in landfills.

It turns out that A2Politico’s reporting and commentary were dead on.

Information revealed by city staff in a recent memo to Council made available on the City’s web site shows clearly that the wheels are coming off of the year-old single-stream recycling cart, as it were. Staff in pursuit of more money for Recycle Ann Arbor confessed that fewer recycle carts were placed than projected, and worse still for Recycle Ann Arbor, collections estimates made by the consulting firm hired by Council to evaluate the environmental and financial viability of the switch, turned out to be off by 40 percent. These clearly flawed numbers went unchallenged by the Environmental Commission, City staff, Recycle Ann Arbor, the Ecology Center, or Council members.

At present only about 35 percent of the material processed at the Ann Arbor Materials Recovery Facility (MRF) is actually collected in Ann Arbor. The remaining 65 percent of materials come from the rest of Washtenaw County, Windsor, Toledo, Livingston, Oakland, and Wayne Counties. However, Ann Arbor taxpayers bore the tax burden for the entire fitting of the facility to allow single-stream recycling. In June 2010 A2Politico polled readers about whether they supported the move to single-stream recycling, and 55 percent of respondents said they did not. The expenditure, which environmental experts have criticized as ecologically regressive, was criticized by residents as a waste of money. It was sold by politicos, the consultants they hired, as well as officials from the Ecology Center and Recycle Ann Arbor by repeatedly claiming that single-steam would decrease costs, and vastly increase collections, making Ann Arbor ever more green.

The problem, as the saying goes, was in the details and caused by long-time incestuous business and political relationships between and among those involved in the push to make the switch and throw a $23 million dollar no bid contract to Recycle Ann Arbor, as well as a six-figure pay out and glowing recommendation for another contractor to use in its marketing materials.

In Ann Arbor the Green Machine has morphed into what one member of the Parks Advisory Commission calls the Green Industrial Complex. Green in Ann Arbor has become about taxpayer dollars feeding a gaping non-profit maw. It is a tightly-knit group of non-profit/for profit companies, the owners, CEOs and Executive Directors of which have turned green into gold, no bid contracts, sweetheart deals and professional credibility, even as their non-profits continue to lose money year-after-year. By providing politicos with glowing endorsements during elections, and meticulously failing to document and report on environmental controversies and challenges in our own community, these local Green Giants ensure a steady flow of public money into their pockets and company coffers. Meanwhile, politicos who push parkland giveaways, failed environmental initiatives, controversial and even regressive environmental policies, are given a free pass by the Green Giants.

This is Ecology Center Executive Director Mike Garfield’s 2010 endorsement from Hohnke’s web site:

“In his brief time on City Council, Carsten has become a leader on environmental issues. He fought for important improvements to Ann Arbor’s recycling program that will let the City recover more materials and save taxpayer funds. He has championed the Greenbelt program, which has saved thousands of acres of land, and is now helping farmers grow local food for the Ann Arbor area. I urge you to re-elect Carsten to City Council.” – Mike Garfield, Environmental Activist

This is Garfield’s endorsement from Hieftje’s campaign web site:

“John Hieftje has the strongest environmental record of any Mayor in the Midwest. He’s championed the city’s Greenbelt, the clean energy initiative, commuter rail, bicycling and our terrific parks system. These programs set Ann Arbor apart. John’s leadership has set the standard for progressive mayors everywhere.”

How were the consulting firms RecycleBank and Resource Recycling Systems able to seemingly invent numbers and have the work go unquestioned? Green Giants, the Green Industrial Complex, and the chance for a huge public money pay-out. Who are the Green Giants?

The family members (see an illustrated chart of connections below):

David Stead, owner, Resource Recycling Systems, Board member of the Ann Arbor Environmental Commission, Director Recycle Ann Arbor, former employee of Recycle Ann Arbor, company hired to consult for City of Ann Arbor to recommend switch to single-stream, benefits financially  from single-stream recycling switch, benefits professionally  from single-stream recycling switch

Michael Garfield, Executive Director, Ann Arbor Ecology Center, Director Recycle Ann Arbor, benefits financially from single-stream recycling switch, benefits professionally  from single-stream recycling switch

Melinda Uerling, CEO, Recycle Ann  Arbor, former Project Manager Resource Recycling Systems, benefits financially  from single-stream recycling switch, benefits professionally  from single-stream recycling switch

John Hieftje, Mayor, sponsored resolution to switch to single-stream recycling, former board member Recycle Ann Arbor, endorsed by “Environmental Activist” Michael Garfield, benefits professionally  from single-stream recycling switch

Carsten Hohnke, Fifth Ward Council member, sponsored resolution to switch to single-stream recycling, endorsed by “Environmental Activist” Michael Garfield

Margie Teall, Fourth Ward Council member, sponsored resolution to switch to single-stream recycling, endorsed by “Environmental Activist” Michael Garfield

City Staffers

Tom McMurtrie, Manager Systems Planning Unit, benefits professionally  from single-stream recycling switch

Sue McCormick, Public Services Administrator, benefits professionally  from single-stream recycling switch

Former City Administrator Roger Fraser

Recycle Ann Arbor, a non-profit under the control of the Ecology Center, collects  recycling in the city in return for $1.8 million dollars per year. Recycle Ann Arbor is a financial wet, hot mess. Between 2007-2009 Recycle Ann Arbor, under Executive Director Melinda Uerling, has been unable to turn a profit. Uerling has led the organization to losses totaling almost $700,000 in just those three fiscal years. Despite the losses, Uerling’s salary was increased by her Board of Directors. In 2008 Recycle Ann Arbor lost $468,911 and Uerling was paid $98,377. The next year, 2009, Recycle Ann Arbor lost $141,000 and Melinda Uerling’s salary was increased by the Board to $100,992. According to the July 5, 2011 memo by city staff, the current “financial shortfall is affecting RAA’s ability to operate on a month-to-month basis…and in many months they do not break even.”

Under John Hieftje’s administration, Council extended a no bid contract to a financially troubled company. Council awarded Recycle Ann Arbor a no bid contract, in part, because the report done by RRS came back with a rosy estimate of increased collections used to justify the idea. The consultant’s flawed report purported that if Ann Arbor were to switch to single-stream recycling, in fiscal year 2011 the city would have 32,779 recycling carts out into which residents would obediently pour 18,425 tons of recyclables. According to the staff memo, “In 2011, The actual number that will have been collected in FY11 will be approximately 10,800 tons, a 40% shortfall….On the positive side, the actual ton collected is still a 20% increase over the number of tons that were collected in the previous year.” More accurately, it is a decrease over the number of tons collected between 2007-2009.

How city staff, who couldn’t accurately project collections before the program was implemented are suddenly able to accurately project collections through the remaining six months of 2011 is a mystery. If Ann Arbor residents actually put out 10,800 tons of materials, the city’s recyclers will have put out fewer tons of materials than put out for collection in 2006, when the city paid Recycle Ann Arbor $1,000,000 per year less to do collections. Taxpayers are paying Recycle Ann Arbor $1 million dollars more to collect fewer tons of materials than the company did in 2006.

The City’s recycling program manager, Tom McMurtrie, his boss Sue McCormick and then City Administrator Roger Fraser all signed off on the resolution prepared and presented to Council which included the over-blown estimates of carts, tons collected, and revenues.

Sue McCormick and Tom McMurtrie both were quoted in the press as saying that single-stream recycling was going to “save Ann Arbor taxpayers money,” increase collections and provide Ann Arbor with the requisite bragging rights needed to justify the millions spent on the change-over to single-stream recycling.

Carsten Hohnke, one of the sponsors of the resolution to move Ann Arbor to single stream recycling, along with Ward Four’s Margie Teall and Mayor Hieftje, was quoted in a November 6, 2009 post to AnnArbor.com written by Ryan Stanton as saying:

This is a smart step forward for us and for our solid waste program. I feel convinced that we’ll see a significant increase in the amount of waste that we’re diverting from landfills and therefore the cost that we incur in taking waste to landfills.

The other exciting part of this is that we’ll have an opportunity to generate additional revenue from a greater volume in the recycling stream and to provide additional services to neighboring municipalities and help spread recycling beyond Ann Arbor.

Most Ann Arbor taxpayers probably don’t know that thanks to the cozy contract negotiated between politicos and Recycle Ann Arbor, taxpayers foot the bill for the trucks, fuel, and repairs of Recycle Ann’s Arbor’s collection vehicles, —-including the new ones purchased for $1.5 million in 2010. The new carts cost taxpayers $1.4 million.

Radio Personality Lucy Ann Lance was employed to record an automated phone message urging Ann Arbor residents to sign up for the RecycleBank points program. In August of 2010, in an interview with John Hieftje on her Business Insider show, hosted on 1290 WLBY, Lance told her radio listeners how excited she was that Ann Arbor’s Mayor had supported the switch to single-stream recycling. Cranky comments repeatedly posted to AnnArbor.com beneath Lance’s interviews of city managers, point out correctly that she is a city staffer. Lucy Ann “Visovatti” is employed by Ann Arbor as the Assistant Manager of the city’s CTN network. In essence, one AnnArbor.com comment pointed out, Lucy Ann Lance interviewing her bosses without mention of her status as a city employee, “is grossly unethical.”

Lance, however, was unable to work her magic. RecycleBank sign-ups have fallen well below estimates made by the company, as well as by city staffers Tom McMurtrie and Sue McCormick. Thus, RecycleBank revenue sharing estimates missed the mark, as well.

The bottom line is that Recycle Ann Arbor is losing money, because the pie-in-the-sky projected increase in tonnage never appeared. Collections are up over 2010, but down over previous years and nowhere near the 18,000 tons projected by David Stead’s company, RecycleBank, and pitched to Council and the public by city staffers McMurtrie and McCormick.

For Recycle Ann Arbor, single-stream is turning into a giant money-loser. The RecycleBank program has not found favor among Ann Arbor residents, experienced recyclers, a good number of whom know that rewarding residents for collections is not true environmentalism as much as it is clear consumerism. The wheels have come off the single-stream cart, and Michael Garfield told AnnArbor.com that “He…hopes the contract can be amended again to avoid further financial complications for Recycle Ann Arbor.”

It’s clear that the RAA contract doesn’t need to be amended, but rather needs to be ended. City staff, politicos and Green Giants are benefitting professionally, politically and financially, at the expense to taxpayers, from a corrupt and tangled morass of money-losing non-profits willing to play political ball and who have been allowed to use city boards and commissions for their own benefit. Local politicos such as Teall, Hohnke and Hieftje clearly rely on the green stamp of approval provided by the leaders of some of these same publicly-funded non-profits to mislead voters into believing that regressive environmentalism is what’s best for our city. In reality, the single-stream recycling mess shows that these politicos and Green Industrial Complex companies such as the Ecology Center, Recycle Ann Arbor and Resource Recycling Systems are doing what is their own best interests, environmentalism be damned. 

Recycle Ann Arbor Has Lost 700K & Michael Garfield Thinks RAA Is Entitled To A Taxpayer Bailout
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Short URL: http://www.a2politico.com/?p=9097

3 Comments for “The Wheels Come Off The Recycling Cart: Projected Collections Down 40 Percent & Recycle Ann Arbor On the Ropes Financially”

  1. Glenn Thompson

    There should be a “not” in the next to last sentence of my post

  2. One of the reasons Recycle Ann Arbor is losing money is their
    purchase of Calverts in February 2007. According to RAA’s
    audited financial statements, they had to write off some of
    the Calverts assets as worthless and restructure the debt.
    The restructured debt has a large balloon payment due in 2012.

    If RAA is having trouble operating on a month-to-month basis
    it’s because the city contract is not profitable enough to
    offset the losses from the Calverts operation.

  3. From AnnArbor.com

    “First, it is not a 40% shortfall, it is an 80% shortfall. Tom McMurtrie told Council the recycling would double to 18,000 tons. An increase of about 9,000 tons. He claims he got an increase of about 2,000 tons or 20% (using the base of 9,000) The shortfall was therefore 7,000 tons or 80% when you correctly use the same base number.

    Second, when this was first proposed Mr. McMurtrie used Westland Michigan as an example of a city that doubled its recycling with single stream recycling and the recyclebank program. Mr McMurtrie failed to mention that before the single stream recycling and the recyclebank program Westland did not have curbside pickup. When this was pointed out he stopped using Westland as a model. but did not revise his estimate.

    Several citizen groups pointed out it would be nearly impossible to achieve the optimistic estimates provided by McMurtrie. Ann Arbor had a high citizen participation rate in the dual stream program. It was very unlikely that sufficient additional citizens would participate to double the collection. The additional materials collected in the single stream program are plastics. Most of these, like yogurt containers, are very light and could double the collected tonnage.

    Mr. McMurtrie and Mr Frey do not need to point fingers, they only need to look in the mirror.”—Glenn Thompson

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