Banking & Finance, Government, and Sustainability

County is talking trash

Waste haulers object to being ‘tax collectors.’

December 5, 2014
| By Pete Daly |
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Kent County trash
A proposed plan to cover landfill legacy fees would institute a surcharge on trash pickup. Courtesy

While Kent County commissioners move closer to a Dec. 18 vote on their latest plan for covering future “legacy” costs of three old county landfills, waste haulers are objecting to being tax collectors for the county government.

County officials at a board committee meeting last week did not agree with the haulers that the plan makes them tax collectors, but the subsequent committee vote on it was divided, with three of the eight committee members present voting against the proposal.

The proposed plan establishes a waste hauler licensing program and a county-wide surcharge on residents and businesses paying for trash pickup. The surcharge of 25 cents per month on residential trash collection and 22 cents per cubic yard in dumpsters, plus a new license fee of $30 per year for every commercial trash truck, is expected to generate approximately $1,450,000 a year.

The money would be dedicated to the anti-pollution costs required in maintaining, managing and stopping leaks in three former Kent County landfills. Funds now in hand are expected to run out by 2025, with the shortfall estimated to be tens of millions of dollars.

The surcharge for residential and commercial/industrial waste pickup would appear as a separate line item on bills haulers mail to customers each quarter. The haulers would then forward the money to the county.

According to Doug Wood, director of the Kent County Department of Public Works, the city of Grand Rapids’ refuse collection trucks also will have to become licensed under the ordinance, and the surcharges will be applicable to city residents with trash pickup as well as all businesses and organizations that use dumpsters, including schools. City officials estimate the program may cost Grand Rapids as much as $120,000 annually.

At the county’s public hearing on the proposal last week, Andy Johnston of the Grand Rapids Area Chamber of Commerce said the “top concern is the administrative burden this will place on business — particularly small business.”

Most waste-hauling companies in the region are small businesses, and some who are chamber members have raised their concerns with Johnston. He agrees they would have to serve as “tax collectors” for the county, and the administrative cost “will be high.”

Johnston said there should be a review of those landfill legacy costs, and asked commissioners to delay implementation of the ordinance.

Green Valley Recycling and Disposal Service of Comstock Park was at the hearing to oppose the fees ordinance.

John Van Tholen, president of Green Valley, said he approves of the county’s foresight in trying to cover future costs of the old landfills, but he said it is “inappropriate for the waste haulers to be collecting” the fees and forwarding the money to the county. He said it would probably require audits by the county and additional bookkeeping costs borne by the small businesses.

Two or three other haulers also spoke up, and all mentioned their unwillingness to be tax collectors, with a repeated question being: What if the customer refuses to pay the surcharge? The haulers would be required to tell the county which customers refused to pay. One hauler said any resident who won’t pay would only owe the county $3 in a year’s time, and he guessed the county probably would not bother to try to collect the money.

“I’m not going to give you my customer list,” a representative of Red Creek Waste Services in Ada told the commissioners.

Wood, director of Kent County Public Works, has been working on a funding mechanism for the landfill legacy costs since 2011. He played a key role in establishing the fees and haulers’ license ordinance the full board will vote on Dec. 18, and he said the basic concept came from a meeting the Kent County Solid Waste Management Board had with waste haulers a couple of years ago. He said the haulers described the concept as an example of what was done in Eaton County.

One of the three commissioners who voted against it in the committee meeting last week was Carol Hennessy, who said “a lot of valid points were raised this morning,” leaving “lots of questions.”

Some opponents said the county should fund the landfill legacy costs through a millage on the county property tax, but Commissioner Harold Mast defended the ordinance, saying it is “a way to actually charge the user” of the waste disposal system.

Not present at the public hearing were representatives of Waste Management and Republic Services, which have landfills in the region and also waste pick-up services. The two are among the largest publicly held waste-handling corporations in the United States.

Waste Management is opposed to it. Republic Services did not return a call from the Business Journal.

“Our concern mirrors the concern of the other haulers. We are not tax collectors, and the process should not rely on private industry to collect those funds,” said Tom Horton, Michigan governmental affairs manager at Waste Management.

“This is really a tax, and is this the appropriate way to collect taxes to fund a government entity?” he added.

Wood told the Business Journal commercial/industrial companies will end up paying about two-thirds of the $1.45 million the fees would generate yearly.

Horton predicts the proposal could add thousands of dollars a year to waste-collection costs of school districts and hospitals.

He also said it was an inaccuracy to say the hauling industry proposed the concept of the ordinance. He said haulers were asked at the meeting a couple of years ago with the Kent County Solid Waste Management Board to explain what other regions do to generate funds for public landfill costs. The haulers responded with comments on the Eaton County system.

“There was no statement by anyone in the solid waste industry that this is the program we recommend. … We merely responded with as accurate information as we could on what other counties were doing,” said Horton.

In a subsequent interview with the Business Journal, Van Tholen of Green Valley also mentioned that the comments haulers made were not an endorsement of what Eaton County was doing. But, he said — “only speaking for Green Valley, not for the other haulers” — he is in favor of the county’s plan to fund future costs of the old landfills, “with the exception of private industry acting as tax collectors for the county in a roundabout, convoluted way.”

“We fund veterans, we fund libraries (through property tax millages). Why can’t we fund legacy costs of landfills?”

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