Saturday, June 28, 2014

City to Hold "Unauthorized Trash Fee" Cleanup

San Angelo's City Council will cleanup years worth of unauthorized commercial collections by trash hauler Republic Services-Trashaway.  They will do so by executing a series of moves.

First, Republic has the opportunity to identify "incorrect charges" that occurred over a decade and refund those amounts to commercial customers.  It's the city's responsibility under the contract to ensure Republic lived up to its promises and legal obligations.  Estimates of Republic's unauthorized commercial charges are as high as $9 million. 

Second, City Council will entertain a ten year contract with Republic for the city's trash hauling franchise.  Using the example in the draft contract Republic's fees will go from $10.30 to $14.47 for basic residential service, an increase of $4.17 per month.  This 40.4% increase doesn't include City Sales Tax, currently 85 cents on top of the $10.30.

Third, Council will likely award Republic a contract to operate the landfill for its remaining life.  Republic leases the landfill and operates it as a regional profit making venture.  The company's profit grew by putting more trash in our regional landfill, consistently reducing its projected life.  Last meeting Council approved construction of a new landfill Cell 11A at a cost of $445,000.  Republic will purchase Cell 11A's airspace, not to exceed $1.3 million.  The annual landfill lease payment is roughly $575,000 a year for ten years.

Fourth, the City's legal department stands behind the first three moves.  Items 2 and 3 were approved by Legal on 6-27-14.  A common risk management move is to act like nothing is untoward and admit nothing publicly.  This is why the city has an unwritten internal investigation that will not be shared.  This morning a Standard Times editorial found this lack of transparency odious.

Fifth, after approving new contracts for trash collection and landfill operation Council will wipe out the old fee ordinances, including dropping the language "commercial rates" for "non-residential service charges."

The City of San Angelo bears responsibility for its proceeds from unapproved fees, 4% of any total.  The City awarded the franchise to Republic, later providing little to no oversight in key areas.  Language and actions along the way indicated the City's determination to retain Republic.

The final move in that strategy should come Tuesday with a well coordinated Republic cleanup.  The only thing that might get in the way is the will of overcharged commercial, I mean non-residential customers.  It should be an interesting meeting.

Update 6-30-14:  San Angelo Live pegged the monthly trash collection price increase at 48%.  With property valuations soaring and a water rate increase on the way, citizen's pocketbooks could take a hit on multiple fronts.

Update 7-1-14:   The cleanup is complete with all five strategies executed by City Council in a 4-3 vote.

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