Cash for Trash
The view from the top stinks. That sweet, sulphuric stench that can come only from a 225-foot-high, mile-wide mound of garbage. At Sample and Powerline roads in Pompano Beach, this is Mount Trashmore, the tallest landform in South Florida, a monolothic monument to the region's waste, which has been fermenting for most of the past half-century.
This property belongs to Waste Management, the $20 billion company that rules the industry in South Florida and most every other market in America. John Albert, a company spokesman, points uphill, where a compactor's spiked wheels are crushing and shredding freshly dumped garbage, scattering a flock of crows and egrets.
"When we get done up there," Albert says, "we'll start filling down here."
It was farmland in 1961, when Broward County gave it to the trash hauler for use as a landfill. Of course, the term's a misnomer in South Florida, where one can hardly dig five feet before hitting water. Here, one can "fill" only the surface, and there's much less of it, since the surrounding lands have filled insteadwith houses, stores, and parking lots. This, plus our location at the end of a peninsula, has given rise to the fear that we could find ourselves trapped too close to our garbage.
That fear in turn gave rise to the creation of enormous trash-burning plants as well as rigid contracts with companies like Waste Management and Republic Industries for hauling the waste.
Thus, the county seems to have created a monster whose ravenous appetite demands more trash, lest the already high consumer costs break through the ceiling.
Next week, Broward County residents' trash bills will go up again, as they do every October 1, the start of a new fiscal year. The extra 50 cents or dollar a month is nothing next to the comfort of knowing that the waste one creates is someone else's problem.
Waste Management is happy to oblige. The company founded by Fort Lauderdale's own H. Wayne Huizenga enjoys a wider profit margin in the Broward County market than in any other, say industry sources. (A Waste Management spokeswoman refused to confirm or deny that report.)
Very little of the county's trash bounty, however, goes toward recycling efforts. According to critics, Broward's trash is handled recklessly: Most of the materials that can be recycled, easing the burden on our environment from tons of nondegradable trash, are not.
Why? Simple: The trash hauler in Broward County gets richer by not recycling, and if you believe the environmentalists, the campaign coffers of elected officials get richer by not demanding that the hauler recycle.
Says Vincent Mercandetti of the recycle-savvy, Lantana-based Southern Waste Systems (which is, incidentally, trying to get a piece of the county's recycling pie): "The county's waste management efforts are medieval by today's standards of recycling. As a result, the taxpayers are being hosed." SWS is seeking the authority to recycle construction materials.
Broward's retro style of handling trash seems impervious to the national trends that have taken hold in other urban areas. Even as new companies, like Organic Recovery of Pompano Beach, arrive in the region with new cost-cutting, eco-friendly technologies, they encounter the same waves of resistance that have held back reform for decades. Broward County has a dirty habit when it comes to garbage, and it won't come clean without a fight.
It's still dark out on a Wednesday morning in September when garbage truck drivers crowd the dispatch office at the Pompano Beach offices of Waste Management, the region's dominant trash hauler. "Did you fix my truck?" a driver yells over the Creole voices of Haitian drivers.
"No, but I got you a bike," cracks the dispatch man, whom they call Ace.
They're a bit like a squadron of pilots. All dressed in identical fluorescent jerseys and industrial boots, they fan out across a supermall-sized parking lot, climbing into their respective trucks. Then they roar through the front gates, one after the other. Theirs is a dangerous if mundane mission: Last year, trash collectors were more likely to be killed on the job than cops, a hazard that comes with working in traffic.
For one driver, Carlos Coleman, dawn finally breaks as his truck rumbles along the overpass connecting I-95 and I-595. He's headed for a residential neighborhood of Cooper City. Most of his clients are still sleeping, and he moves quickly, discreetly down the block of a subdivision, lifting the plastic tote carts with pincer fingers, which dump the trash into his front loader. Once it's filled, Coleman activates the hydraulics that lift the bin over his cab and dump its contents into the bed of his truck.
Shortly after helping a homeowner in jogging shorts hoist broken toilets into the front loader, Coleman looks at the reporter scribbling notes. "What kind of article is this?" he asks. Coleman seems puzzled that a reporter would find it worth tagging along with him on his route.
But he performs a noble duty, given the essential role that hauling trash plays in public health. In the Middle Ages, Europe's accumulated trash attracted the rats that spread the bubonic plague and wiped out one-third of the population. The earliest American cities invited pigs, dogs, and cats to feast on the trash, but as those cities grew, so did their garbage, and no amount of scavenging animals could keep the waste from piling up.
So cities encouraged entrepreneurs to launch companies that could haul trash. To make that venture more profitable, businesses were offered cheap land on which to dump the trash. In most cases, those companies enjoyed what amounted to a monopoly if only because a rival company would need a great deal of land, a fleet of expensive trucks, and a big payroll to compete with the original hauler.
Like any monopoly, this one posed the risk of fostering a too-cozy relationship between the garbage industry and politicians.
In Broward County, the growing landfills competed for space with expanding western communities until, in the 1980s, it became clear that some other solution would be needed.
In 1986, 23 cities in Broward joined with the county to create a solid waste district, the effect of which was that the majority of the cities awarded an exclusive trash franchise to a single company. That company then was required to dump the city's waste at one of two enormous incinerators, one built in the north end of Broward next to the landfill in Pompano Beach, the other in the south end, near Fort Lauderdale's border with Davie. Roughly $1 billion in construction costs was to be paid by issuing bonds. Those revenue bonds were to be paid back through the collection of tipping fees — the price paid by the hauler to "tip" its loads of trash into the incinerator.
Of course, the hauler passes that cost to the consumer, who pays it along with his trash bill. The higher the tipping fee the hauler pays, the more residents and businesses have to pay. One reliable way to keep the tipping fee down is to make sure that the incinerators are well-supplied. After all, the more loads of waste, the more collected in tipping fees.
The franchise cities who form the district negotiate with the waste haulers through the Resource Recovery Board, which enforces penalties. Because the district shares the costs of paying back the bonds on the incinerators, they have reason, collectively, to penalize any city that fails to do its part. The city that doesn't dump as much waste as was budgeted would not generate enough in tipping fees, causing costs to rise for the other cities in the district. In those instances, the Resource Recovery Board has a doctrine called "put or pay" in which it demands that the city pay the shortfall, usually with money from its general fund. Doing so means that those city officials have less money for city services, a prospect that might make them unpopular among voters.
It seems complicated, but the crucial point is that under this system, city officials have every reason to keep generating more waste, if only to keep down costs for their residents and businesses.
Worse yet, since recycling reduces the amount that is dumped, the city has reason to discourage it. "The waste stream is mortgaged to pay off those bonds [for the incinerator]," says Fort Lauderdale Mayor Jim Naugle, who sits on the board. "The more you recycle, the less [money] you have with which to pay off those bonds. "
For all that, the cities are not even saving money: The franchise cities pay a tipping fee of $93 for each ton of waste dumped at the incinerator, because that cost includes the payment on the construction bonds. The communities who opted out of the deal pay about $45. Multiply that difference over millions of tons and a couple of decades, and it adds up. "It's been a really bad deal for us," admits Naugle, whose term limits may allow him to be a bit more candid than other mayors. "We've lost hundreds of millions of dollars by being part of this."
Conversely, the haulers — industry giant Waste Management and Sunrise-based Republic Industries — have made millions. It's a simple matter of volume: Because it's allowed to calculate the operating expenses, then build into that formula a profit margin, the hauler makes more money the more loads of trash it takes. And with so many Broward communities locked in, that's loads of profit. What's more, it comes without the threat of competition, and the cash flow is guaranteed by city governments.
Just in case those city officials should be tempted to think critically about this arrangement, the waste haulers shower them with campaign contributions.
From candidates' campaign disclosure statements, it is hard to know which of the bundles of donations are attributable to the trash hauler, but an industry source lists the usual suspects: "The waste hauler, his parent company, their employees and attorneys, the landfill, the transfer station, the incinerator company, and the lobbyists." In addition, subcontractors who fix garbage trucks or clean them give the max. Add up these interests, multiply it by $500 (the maximum allowed for an individual donor), and it's clear that in the relatively inexpensive business of running for city office, siding with the trash haulers can give candidates a decisive fund-raising advantage. Conversely, by blowing the whistle on trash haulers' political influence, a candidate cuts his own throat.
Just before noon, Carlos Coleman has a full load of trash, and he heads to the South Broward incinerator, the end of the line for Broward trash.
Wheelabrator Technologies, a wholly owned subsidiary of Waste Management, owns the incinerators, which the company refers to as "waste-to-energy" plants. That's because by burning waste, it heats water, creating steam, which is sent to a turbine generator, producing electricity.
The waste-to-energy description employs the same Orwellian logic as the naming of the Resource Recovery Board. While something is "recovered" in burning garbage — a bit of electricity — even more is lost. Incinerating waste means the loss of materials that might have otherwise been recycled, meaning that more resources must be used to create those goods from scratch rather than from recycled material.
Nor is it as clean as recycling. Combustion of waste creates ash that must be put in a landfill, which emits methane, a greenhouse gas. That ash also contains dioxins — chemical compounds that are difficult to contain. Once airborne, they tend to become embedded in soil, then find their way into dairy products, meat, and fish. While most do not harm humans, chronic exposure to the most toxic dioxins is associated with high rates of cancer (the ash from Broward incinerators is tested before it is buried).
Finally, when a region spends a fortune on incinerators, it tends to use them — at the expense of recycling. In 2005, the most recent year for which data are available, the franchise cities burned 91 percent of their solid waste. Four percent was landfilled. Only 5 percent was recycled.
"This is not an ideal technology," says Linda Christopher, executive director of the California-based Grassroots Recycling Network, speaking of waste incinerators. "They lock these communities into 30-year contracts, and it precludes future recycling options that are more cost-effective and better for the environment."
Technological innovation has allowed for the recycling of more materials. Besides the paper, plastic, and glass that can be placed into bins by homeowners — materials that comprise about 40 percent of the waste stream — there are new methods for recycling construction debris and even food waste.
Historically, the way to cut down on food waste was through composting. But that's woefully inefficient and not as environmentally neutral as most think. For one thing, it takes a lot of space. For another, the decomposing food can breed harmful bacteria and release CO2 into the atmosphere.
Jeffrey Young has found a better way. In the 1990s, he ran a Bedford, Massachusetts, fish processing plant. "Sixty percent of what we took in was going to the landfill — a million pounds a week," Young says. State environmental regulators asked him to reduce the plant's footprint. So he started a division of the company to process its waste, turning the discarded fish parts into a fertilizer he called Organic Gem.
Farmers loved it. Organic Gem's natural ingredients did not bring the runoff that comes with chemical fertilizers, and they cured crops of their chemical dependencies, making them healthier, more resistant to disease. "Between 1994 and 2000, demand for the fertilizer was more than we could produce," Young says, "and so we started looking for other food waste."
The state tried to convince him to look at Massachusetts grocery stores, except that location put Young's company too far from the farms that were his customer base. His interest in a better location led Young to attend meetings of Recycle Florida Today, a professional association for businesses seeking to network on recycling. There, Young met executives from Publix, the Florida-based grocery store chain. "We were looking to get into the food business, and they were looking for a recycler of their food waste," Young says.
His company, Organic Recovery, would move to a Pompano Beach industrial park, where it would process some 17,000 tons of the solid food waste generated by South Florida Publix stores each year. "It was a perfect match," Young says.
But these mates didn't have a wedding; they eloped. In the nearly two years it took for Organic Recovery to relocate to South Florida, neither side told the Broward officials of its intentions — not until they staged a dramatic grand opening August 7, with Gov. Charlie Crist as guest of honor. "What these businesses are doing is a perfect example of how there is gold in green and economic opportunity in sustainable business practices," he declared.
As significant as the presence of the governor, so too was the absence of any official from a city in Broward County. Their invitations had not been lost in the mail.
In the weeks to follow, the deal between Organic Recovery and Publix would be celebrated on National Public Radio affiliate WLRN-FM (91.3) as well as in the Sun-Sentinel and Miami Herald. But none of those media reports acknowledged what should have been the elephant in the room: Will the entrenched, waste-hauling giants of South Florida, their pockets full of political friends, allow some New Englanders to waltz into town and take tons of their precious waste?
Ron Greenstein, a former state representative from Coconut Creek, chairs the Resource Recovery Board, the quasi-governmental body that oversees the disposal of trash for the communities that form Broward's waste district. And he's been trying like hell to get in touch with Jeffrey Young.
"I think it's a great program," he says of the Organic Recovery-Publix partnership. If so, he has a funny way of expressing congratulations. Shortly after he saw the August 7 news release that heralded the grocery store's new recycling plan, Greenstein had the board's attorney fire off a letter informing the partners that they were in violation of the flow control ordinances. At an August 26 meeting, the board's attorney advised the franchise cities to investigate the recycling program.
As a provision of the 1987 agreement, the franchise communities each passed flow control ordinances stipulating that all municipal waste within the district be sent to the incinerators, the better to pay back those bonds for the incinerators' construction. According to the ordinances, that food waste being recycled was supposed to be burned. "We haven't heard back from them," Greenstein says of Organic Recovery.
The 17,000 tons of solid food waste per year processed at Organic Recovery is a modest percentage of the roughly 2.6 million tons of solid waste that flows through the district. But from the Broward waste district's perspective, the deal sets a scary precedent. If Publix, one of the biggest generators of waste in the state, is allowed to divert its waste from the landfills and incinerators, then other businesses may do the same. And with less waste going to the landfills and incinerators, the cities in the district will fall short of their put-or-pay requirements, meaning they'll have to dig into their own general funds to make up the difference. In the cockamamie world of South Florida waste, a recycling revolution would mean financial disaster.
Asked about how he'll respond to the county waste district, Young says, "No comment." But when asked earlier about the material he receives from Publix, he is circumspect, noting that it is "source-separated," not discarded. This may seem an exercise in semantics, except that the distinction is critical if it comes up in a future court case. The moment it becomes waste, the county's district gives the trash hauler legal claim to it. So what Organic Recovery and Publix would argue is that it never becomes waste. Publix employees toss the food waste into refrigerated bins provided by Organic Recovery, which picks them up at the site. Nonfood waste goes into conventional Dumpsters.
This conflict is familiar to attorney Sandy Pollack, director of legal services for Southern Waste Systems, the Lantana company that, like Organic Recovery, aims to recycle materials that would mostly be incinerated or dumped in landfills. Only with SWS, it's construction and demolition debris — called simply C&D within the industry — which comprises roughly 40 percent of the entire waste stream. But it may as well be food waste.
"They have the same problem that we have," Pollack says of Organic Recovery. As in that case, the hauling companies that have franchise agreements in Broward cities lay claim to the material that SWS would recycle. Only in SWS' case, the distinction is between "industrial byproducts," which state law allows to be recycled, and "discarded" material, to which the franchise hauler is entitled.
Most of the C&D currently collected by SWS comes from Palm Beach County, where the exclusive franchise system of waste hauling isn't nearly as widespread as in Broward, which Pollack calls "a locked-up community."
SWS has four recycling centers in South Florida, one at its corporate headquarters in Lantana. There, an excavator plucks the waste out of a Dumpster and puts it on a couple of belts that move it through a blower that extracts plastic. Waste of under ten inches is sifted out; waste that is more than ten inches gets ground into smaller chunks. From there, workers segregate the material. Concrete is separated from metal. Plastic is another category. So is rock. And wood is separated to be sold as mulch or burned in coal-generation plants for electricity. One more worker picks up nonrecyclables. Each variety falls into its own compartment, the size of those at a self-serve car wash, until a bulldozer pushes the materials out and into a buyer's vehicle.
In this fashion, SWS recycles at least 70 percent of the material it receives, a rate that dwarfs that of Waste Management, or any other hauler, whose built-in profits give them less financial incentive to invest in the costly business of sorting, then recycling.
For SWS, whatever can't be recycled — the remaining 30 percent or less — goes to a landfill. But since the material collected by SWS is nonputrescible (that is, it doesn't rot in a way that could seep into the groundwater), it can be placed in landfills without an expensive liner system, nor fear of environmental damage. Plus, since SWS makes money by selling disposed materials to recyclers, it can afford to cut rates for collection.
Over the sound of a bulldozer, Pollack says with evident pride, "Yesterday, 1,800 cubic yards of material came in, and 1,800 cubic yards of recycled material left."
But that recycling center can process 1,200 tons of material per day. It's not operating at full capacity partly because the housing slump means less available C&D. And partly because the company can't legally collect the C&D in cities where franchise agreements give those materials to the hauler. Last year, Pollack asked the Florida Department of Environmental Protection to give SWS a permit to collect C&D materials on the grounds that these were industrial byproducts — not discarded — and thus, eligible to be recycled.
Correspondence between the two sides shows the state agency trying to dissuade SWS for six months. Ultimately, the agency ruled that state law had not attached a clear enough definition to industrial byproducts and that they would be treated as discarded material. That meant C&D would mostly be burned by the hauler, not recycled by SWS.
When it comes down to questions of interpretation, the side with better political connections tends to win.
For five years, Pollack has been arguing his case, but at every venue, the hauler has an advantage. To be granted permission to pick up C&D in one city means challenging the constitutionality of flow control ordinances in municipal courts, ruled by magistrates who Pollack suspects have close ties to the city commissioners, who get campaign donations from franchise haulers and who may want to send C&D materials to the incinerator to avoid put-or-pay penalties.
Still, Pollack is so convinced he's right, he remains baffled by the resistance he's encountered at every level of government.
"Not only is it legally wrong," Pollack says, "it's morally wrong. How can you discourage recycling?"
But maybe the hard-charging Pollack has weakened the resistance so that Organic Recovery will have better luck. Certainly, the company flexed some muscle by attracting an ally like Crist to its grand opening. And the company was either very fortunate or very clever in attracting a wave of positive news coverage for the plant's opening. Now, if the franchise haulers try to shut down Organic Recovery, they run the risk of being outflanked by the governor or at least exposed in the media.
A less optimistic observer, however, would worry whether Organic Recovery will go the way of Coastal Carting. In the mid-'90s, this company seized upon the same C&D materials as SWS, only Coastal Carting was even more aggressive, contracting with developers and demolition companies without consulting the cities or the waste district. When officials with the county's waste district learned of it, they threatened to revoke the company's license and levy fines. So Coastal Carting filed a lawsuit against the county.
The company had nowhere near the resources of their adversaries, but lead attorney Scott Mager had the law on his side. After a grueling discovery period that lasted 29 months, a federal court judge granted Coastal Carting's motion for summary judgment, saying that "Broward County is hoarding the waste" and that the flow control ordinance — the very same one that has restricted SWS and that threatens the future of Organic Recovery — "is unconstitutional on its face."
Says Mager: "It was a tremendous victory, because nobody had won a case against the trash industry before." After the ruling, the only chore left was to stage a trial for calculating the damages inflicted by the county against Coastal Carting.
The amount had the potential to be astronomical — possibly enough to threaten the stability of the waste district. That's a golden goose it appears the franchise trash haulers couldn't bear to kill. Before the judge could issue an award for damages, Waste Management bought Coastal Carting, dismissed the lawsuit, and folded the company.
"It was so detrimental," Mager says of the court's ruling, "that [Waste Management's] only option was to pay a lot of money to take over." Whatever Waste Management paid — the company refused to release that figure — Mager suspects it's less than what it stood to lose from the collapse of Broward's solid waste district. "It was a case of 'Can't beat 'em? Buy 'em,' " he says.
Pollack has studied that case, and he sees it as proof that the franchise haulers like Waste Management aren't nearly as tough as they talk. They may threaten to raise the collection rates if the contract cities give their blessing to companies like SWS and Organic Recovery. But he thinks the haulers are making so much money that even if they lost that waste, they would still make a handsome profit. In Palm Beach County, cities like West Palm Beach have called the hauler's bluff, giving permits to C&D collectors without seeing a hike in pickup rates.
Since the franchise haulers' ledgers are not public record, there's no way to know exactly how much profit is built into the rates.
Fort Lauderdale, the biggest city within the Broward Solid Waste District, may also have the biggest gripe. The city's residential consumers pay $35 a month for curbside pick up, tops in the region . This is what inspired Mayor Naugle to cast Waste Management in an unsavory metaphor: "I made a statement about how 'If you lie down with dogs, you get up with fleas,' " he laughs. When the hauling giant complained, the ever-contrite Naugle apologized — to the dogs, lest they feel slandered by comparison to Waste Management executives.
Greenstein, of the county's Resource Recovery Board, treats those same executives as partners. Although he concedes that the franchise system has not delivered the cost savings its member cities might have hoped for, he argues that it was the best solution to the county's old waste program and that when the contract ends in 2013, the county and its haulers will devise a new program that accommodates new technologies for recycling.
"There is a new state law through which [the Department of Environmental Protection] will mandate that governments recycle 75 percent of the municipal solid waste," Greenstein says. "I think we'll have a new contract in a few years, and we can make changes."
But that law appears toothless. It mandates that the state regulators ask cities whether they'd cooperate with the endeavor. If those regulators get a hostile reception — as they certainly would from the powerful interests in Broward — the mandate will be scrapped. And even in its feeble condition, the law is under assault.
At the August meeting of the waste district's franchise cities, Greenstein called on members to join his effort to convince the state that burning trash should count as recycling.
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