City Paper is not for tourists
Sanitation workers get no break from the pandemic. The epitome of essential, they show up in the morning light to collect waste and garbage from our homes, offices, and street corners. Trucks from the District’s Department of Public Works pick up trash from single-family homes and small multi-family dwellings, and private companies collect waste from apartment buildings, offices, and commercial properties.
All that trash ends up passing through the District’s massive garbage collection facilities, known as trash transfer stations.
But every time a private waste hauler pulls up to dump trash at one of the District’s two trash transfer stations—cavernous warehouses where city workers process waste and move it to trucks that haul the garbage to incinerators or landfills—D.C. loses money. For the past decade, every ton of garbage in every private trash truck on city streets has cost D.C. up to $36 more than it should. Taxpayer losses in 2018 alone totaled $8,585,484, according to an 18-month investigation of the waste system.
In total, the District has lost nearly $53.8 million since 2010, thanks to drastically undercharging private trash haulers for access to the city’s public transfer stations.
For years, top District leaders have known and downplayed the fact that the District does not recoup its costs from its business with private haulers, according to a review of internal documents, public testimony, and interviews with officials. Several directors of the Department of Public Works did nothing to stop the bleeding and even denied in public that the city was ever losing money. Ward 3 Councilmember Mary Cheh, who chairs the D.C. Council committee overseeing DPW, at times acknowledged the losses during the last two years, but did not seek legislative fixes until this spring.
This investigation calculated the first-ever accounting of how much the District has lost in processing trash for private waste haulers. The economics of trash hauling and disposal are complicated, but the reason the District loses money is simple: It costs more for DPW to process the waste that enters its public transfer stations than the agency charges private trash haulers in usage fees. In other words, the District is getting ripped off.
The losses stem from two separate sources.
First, between 2010 and late 2019, the District charged about $50 to take in a ton of trash at its public transfer stations, but its expenses were upward of $86 to process that ton of trash and haul it to an incinerator in Lorton, Virginia, according to a review of city documents. District taxpayers bore the $36 difference per ton, which quickly added up to millions. Even after a $10 hike in the fee last year, the District still loses money today.
Second, since 2002, D.C. has been losing even more money because of settlement agreements with the country’s two largest trash haulers, agreements that boost the bottom lines of Waste Management, Inc. and Republic Services, Inc. The settlement agreements handed the two corporations a significant discount to use the city’s trash transfer stations, estimated to be savings worth about $25-per-ton from 2010 onwards.
“It’s a subsidy to some of the largest trash haulers in the country, plain and simple,” says Neil Seldman, co-founder of the District-based Institute for Local Self-Reliance. As director of the environmental group’s Waste to Wealth Initiative, Seldman has studied and testified about D.C.’s trash and recycling operations since the 1990s. “This is a prima facie case of malfeasance,” he says.
Based on documents obtained through Freedom of Information Act requests, court settlements, interviews, and public testimony, this investigation found:
- The taxpayer losses were raised to leaders at DPW for years. Since early 2018, Cheh has periodically brought up the issue with DPW directors at public hearings. But as the chair of the committee with oversight over the agency, Cheh never sought a study of the problem. Early this year, she accepted the word of current DPW Director Chris Geldart, who claimed, without citing data, that the settlement agreements weren’t leading to losses. In the District’s Fiscal Year 2021 budget, she, for the first time, proposed a hike in the transfer station fees to stem part of the losses.
- An outside report from 2016 that was acquired through a public records request told the city administrator’s office to consider ending its agreement with Republic Services when it expired at the end of 2018 due to continued losses. The District has continued to renew the agreement since its initial term ended in 2013.
- The bargain rates for private trash companies are more than just a loss for taxpayers. The District’s low fee to use its public transfer stations have incentivized trucks from neighboring counties to drive truckloads of waste into the city. D.C. stands out in the region for allowing the import of trash into its public stations from beyond its borders.
- Geldart admits dismay with the District importing trash, but the city has not examined the scope of the problem. It is currently unknown how many tons of trash the city accepts from neighboring counties each year. One estimate from a city-commissioned 2011 report said it could be tens of thousands of tons annually.
“It’s a huge environmental problem,” says Chris Weiss, director of the D.C. Environmental Network. “Think about all the trucks coming through the District—the diesel exhaust, the wear and tear on our roads.”
Geldart knows that D.C. serves as a regional dumping ground.
“You can see the trucks that come in that haven’t picked up trash in the District of Columbia,” Geldart said in an interview last year. “It’s less expensive for them to dump here.”
The District’s low fees for private haulers have not only cost taxpayers millions of dollars. They have also impoverished D.C.’s trash processing system. One of the two city-owned transfer stations is “in dire need of being torn down,” according to Mayor Muriel Bowser’s most recent budget request, and “presents a safety hazard to the employees.” Yet the facility on Benning Road NE will have to function for another five years before it can be rebuilt with larger capacity. D.C. also faces the potential of millions of dollars in fines from the Environmental Protection Agency for stormwater pollution from the facility, Geldart revealed at a D.C. Council hearing in May.
In his May budget testimony, City Administrator Rashad Young said the transfer station will need to be held together “with a little bit of bubble gum and tape.”
Seldman believes the troubled system is primarily a result of the low fees for private haulers. “Not only are we not getting basic operating costs in the transaction, but we’re not getting maintenance and replacement costs back,” he says. “Any city should do that.”
The 2002 settlement agreements were negotiated to give Waste Management and Republic Services low flat fees in exchange for the two companies closing some of their privately owned transfer stations in the city. Private stations near residential neighborhoods were nuisances that city and neighborhood leaders wanted to shutter. But environmentalists and experts say the discounts given in return for the station closures went way too far, and on for too long.
The settlement agreement with Republic Services has been renewed several times since its original term ended at the close of 2013, including most recently at the beginning of this January, leading to continued losses.
Cheh has raised these issues to DPW directors in public hearings, but often without much fanfare. Asked after a January 2020 oversight hearing why she didn’t hold Geldart accountable for the lost funds, she said, “It’s a mystery to me. I should have pressed them more today. That’s a stream of money.”
The “stream of money” is especially significant in the current budget picture, when revenue losses from the COVID-19 pandemic have forced the mayor and Council to freeze government workers’ pay in order to balance the District’s budget, due for a final vote on July 23. Over the years, the D.C. waste business’ average annual loss of $6.45 million would have been enough to help fund additional investments in early childhood education, the establishment of a compost system, or the repair of the city’s decrepit transfer stations.
“We’re just giving money away,” Weiss says. “Dollars are being wasted.”
Like in most big cities, waste is collected in two ways in the nation’s capital.
The Department of Public Works has its own publicly run fleet. Every weekday morning, more than 50 of the city’s orange trucks—owned, operated, and maintained by the District—ply dozens of routes to collect trash and recycling from residential neighborhoods. D.C. workers also collect solid waste from public schools and multi-family dwellings with three or fewer units.
Garbage trucks owned and operated by private trash companies pick up and dump solid waste from dumpsters behind commercial complexes, restaurants, condos, office buildings, department stores, and other large structures. In 2018, the private companies handled 302,000 tons of solid waste, more than twice what DPW’s trucks handled, according to data obtained through a public records request.
Trash hauling is a high-cost and highly competitive business. A new trash compacting truck can cost as much as $350,000, and the workers that operate the equipment are well-trained in the dangerous occupation. At least 71 trash companies are licensed to operate in the District, according to DPW’s latest figures.
Two mega-companies dominate D.C.’s private hauling system. Republic Services, the second-largest waste hauler in the country, drives the most trash into D.C.’s transfer stations, followed by Waste Management, the largest trash company in the U.S.
When public and private trucks finish picking up trash and recycling, they all pull up to a transfer station. The District of Columbia has no landfills. Every trash truck has to dump its load into one of four transfer stations. DPW operates two of the stations; the other two are privately owned, but the District’s stations are more advantageous to use due to their capacity and low usage fee. Each truck drives up, stops at a weigh station, dumps its load, and returns to its route.
D.C. charges private haulers a fee, called a tipping fee, for dumping trash at one of its two transfer stations, one at Fort Totten and the other on Benning Road NE. The District bears the costs for weighing trucks, managing trash in the transfer stations, storage maintenance, staffing, and loading solid waste into the tractor trailers that haul it to incinerators and landfills. D.C. also pays to truck slightly less than half of the waste received at stations to an incineration plant in Lorton known as Covanta Fairfax, as well as the cost of burning it there. Waste Management and Republic independently handle the transport of their waste from transfer stations to landfills, dropping it at a D.C. transfer station and coming back later to haul the same amount out.
This investigation found that the District has lost between $5.59 million and $8.58 million a year in the trash business over the past decade because low tipping fees and the two settlement agreements for private companies did not cover the cost of the service provided at the public transfer stations.
The bulk of the total losses are due to the settlement agreements for Republic and Waste Management, which undercharge them, on average, more than $4,662,000 a year. The agreement with Waste Management doesn’t expire until 2022. Both companies reject the notion the fees are a discount to them, arguing the city doesn’t lose money because the companies themselves haul their own waste to a landfill.
Taken together, excluding 2015 and 2017, the District lost $53,789,667 from 2010 to October 2019, according to an analysis of the past decade.
Any private company or public agency might be expected to account for its costs in providing a service. Yet the District has never examined its solid waste processing operations, ascertained their costs, and published the results. DPW has never tabulated the costs of labor or the capital and operating costs of receiving, processing, transferring, trucking, and incinerating trash.
According to a 2014 law, the Sustainable Solid Waste Management Amendment Act, the mayor “shall impose a fee on the disposal of solid waste at a solid waste disposal facility owned by the District sufficient to cover the costs of operating, maintaining, and improving the solid waste facilities.”
Despite that law, for years the tipping fee at D.C.’s public transfer stations has not and continues not to cover those costs.
Since the District does not have readily available figures showing the overhead costs of its entire waste management operation, this investigation relied on public data and documents to arrive at a calculation.
The only recent and most accurate accounting of D.C.’s cost of processing trash comes from an April 2017 report commissioned by DPW that studies options for starting a composting program. In estimating the cost of gathering and processing compost, Resource Recycling Systems researched and reported the costs of operating D.C. transfer stations. RRS arrived at a processing cost of $33.70 per ton of solid waste, which became the basis for this investigation’s accounting.
DPW accepted that report and did not challenge the number in public hearings or interviews. Councilmember Cheh has cited the $33.70 per ton figure for at least the past two years in her committee oversight hearings, in front of DPW officials.
Beyond the cost of processing trash in transfer stations, the District must also pay for two other trash disposal services: trucking the waste and disposal. (Waste Management and Republic drive their trash to landfills themselves, so these costs do not apply to them. But the District disposes of waste for all other private operators.)
Between 2010 and October 2019, all trash haulers but Waste Management and Republic were paying the District a tipping fee of about $50 per ton to dump trash at transfer stations. Adding in the cost of D.C.’s contracts with companies that truck trash from public transfer stations to the Covanta Fairfax incinerator site and the contracted costs for incineration, the cost to the District to receive, process, haul, and dispose of a ton of trash has been around $85 for the past three years.
The difference of $35 per ton was a deficit paid by District taxpayers and what critics call a subsidy to private trash haulers.
The Department of Public Works did not respond to a list of questions about its business with private trash companies and whether it supported raising fees to recover more costs.
The two-part reason why D.C. loses money in its dealings with private waste haulers starts with the settlement agreements inked with Waste Management and Republic in 2002.
In the early 1990s, the D.C. government was operating in the red and careening toward insolvency. Like other cities at the time, D.C. attempted to corner the market on trash dumping, aiming to raise more revenue. It established what’s known in industry parlance as a “flow control” program, which essentially forced all haulers, public and private, to bring their trash to city-owned transfer stations, located then, as now, at Fort Totten and Benning Road.
To bring in even more revenue, DPW raised tipping fees about $24 to make it $64 a ton. That worked until the Supreme Court in 1994 struck down a flow control ordinance in a town in New York, ruling its regulations violated the Constitution’s commerce clause.
Private transfer stations popped up in warehouses and vacant lots across Ward 5 in Northeast D.C., along the Prince George’s County line. The District passed strict regulations on siting and handling trash to close down almost all of the assorted garbage dumps.
Most of the smaller ones closed, but two large transfer stations refused to fold. One transfer station was owned by Waste Management. The other was managed by BFI, which now goes by Republic Services.
Waste Management and Republic sued the District. In the resulting 2002 settlement agreements, Waste Management agreed to close one of its transfer stations and make improvements to another on Queens Chapel Road NE. Republic agreed to give up management of a transfer station on W Street NE, a facility it was leasing.
In exchange, the District agreed to charge each company a set amount of $6 per ton as a tipping fee, subject to annual adjustments for inflation, to use its two public waste transfer stations. Waste Management’s agreement runs until 2022, while D.C. has renewed Republic’s deal since 2014.
By 2010, that fee rose to $8.44 per ton, but the cost to D.C. for the two companies to use its public transfer station was about $30 per ton, according to City Paper’s analysis.
That disparity in costs has run up to a loss of $41,647,206 since 2010. (That accounting does not include 2015, because, despite public records requests, the District government did not turn over data showing tons of trash the two companies brought into public transfer stations that year.)
In a statement to City Paper, Waste Management says the company “is not receiving a discounted rate compared to what other companies are paying that deliver waste to the District’s two solid waste transfer stations.” The statement says Waste Management pays a small rate at the public transfer stations because it drives its own waste out, unlike other independent private companies, which leave the trash there for D.C. to dispose of at an incinerator.
Republic Services concurred in its own statement: “Comparing the District’s cost to operate its transfer stations to Republic’s costs under the settlement agreement is like comparing apples to oranges.”
After covering the cost of disposing of its trash at a landfill, “Republic actually offers the city value by providing revenue to cover their fixed costs for loading at the transfer stations,” the statement continues.
But the December 2016 report prepared for the Office of the City Administrator said that the city should consider cutting its settlement agreement with Republic Services in 2018 to ensure D.C. recouped more of its costs.
“The District may consider revisiting the cost of service analysis at those junctures to determine adjustments to settlement agreement fees for greater cost recovery,” stated the report by Public Financial Management, a firm that advises cities. The report confirmed that D.C. was losing money on the settlement agreement fees.
“Underlying costs of service are conservatively estimated to be far higher than the current fee level,” the report said.
Briefed on the cost differential, DPW Director Geldart has accepted the roughly $30 disparity. In an interview last July, he said the department hadn’t conducted its own analysis. He repeatedly said that he expects a major hike in fees for Waste Management and Republic in 2022. “It may be $40,” he said. “I can guarantee you that it won’t be the same numbers, if I’m here.”
But then he walked back his vows in public. At a January 2020 D.C. Council oversight hearing chaired by Cheh, he declared, “I honestly can’t answer at this point what we’re going to do in 2022.”
At that hearing, Cheh did not question Geldart’s statements, made under sworn oath, that the District was “making $8.33 per ton off of that” settlement agreement with Republic.
In a brief interview after the oversight hearing, Geldart said, “I did not admit it was losing money” last year.
When pressed about the 2016 report to the city administrator showing that the low fee from the settlement agreement was not recovering the District’s costs, and his previous statements from last year, Geldart replied, “It could be. What I said is, we’re looking at it.” He added he intends to renew the Republic deal on a year-to-year basis.
It’s “not quite a sweetheart deal” for the two companies, Geldart said last year. The settlement agreements, he noted, meant Waste Management and Republic had to shutter their own money-making transfer stations in D.C.
But Seldman and Weiss say Waste Management and Republic did not give up enough to make the settlement agreements even.
“It was a trade-off, and the District gave away far too much on their side of the trade,” Seldman says.
Seldman was a consultant for the D.C. Council throughout the process of closing down many private transfer stations. “Why the mayor signed a sweetheart deal with these two companies is a mystery to me,” Seldman says.
“I definitely recall moving to curtail transfer stations,” says Anthony Williams, D.C.’s mayor from 1999 to 2007, “but don’t recall any discussions about fees. As a rule, I didn’t get involved with negotiations and procurements for obvious reasons.
“I accept responsibility for the good and bad of my administration,” he adds.
On top of the cash drain due to the settlement agreements, the District separately loses money because the tipping fee for everyone else at its two public transfer stations is less than what it costs to run the operation.
The rate to drop off a ton of trash at the stations was about $50 for most of the past decade. Workers at D.C.’s transfer station take in the waste and load it onto large trucks later in the day to carry it to the Covanta Fairfax incinerator, where the city pays to permanently get rid of the waste.
But D.C. was spending more than $50 on that entire operation, according to an analysis of the city’s contracts with a trucking company and Covanta. Between 2010 and 2018, the city spent on average $25 more per ton to process all that trash and send it to an incinerator than it charged companies for unloading at the transfer stations.
Between 2010 and 2018, that ballooned to a total loss of $12,142,461. (That accounting does not include the years 2015, for which D.C. did not provide data, and 2017, when a fire at Covanta Fairfax disrupted the city’s trash flow.)
Meanwhile, some local haulers are crying foul over the settlement terms for Waste Management and Republic, arguing D.C. should also allow them a similar arrangement.
“We would love that deal,” says Barney Shapiro, owner of Tenleytown Trash. He says he has long sought the same arrangement given to the two major haulers: a low fee to unload at the transfer station and the ability to truck his own waste back out to a landfill within 24 hours. “I could be saving myself $3 to $4 a ton if I could operate the same way,” he says.
Geldart understands those smaller haulers are upset with the discounted arrangements given to Waste Management and Republic. But he believes they have their own favorable deal because his agency charges so little at its public transfer stations.
“They’re getting a sweetheart deal compared to other privates that are collecting out in Montgomery County, in Prince George’s County, in Arlington, and places like that, because those guys are paying $20, $30 more a ton to do their job,” Geldart said.
In September 2011, DPW set tipping fees for private haulers at about $50 per ton, down from as high as $71 in 2008. That $50 fee remained unchanged for eight years until October 2019, when DPW finally increased it to $60.62 per ton.
If that price covered the cost of trucking out and burning the trash, D.C. wouldn’t lose money. A few times every weekday, huge tractor trailers under contract with Lucky Dog Industries pull up to the back of D.C. transfer stations. DPW operators load them with trash and garbage, and they haul away the load. Lucky Dog has had the contract since at least 2010.
Trucking costs rose gradually over the past decade, from $10 a ton in 2010 to $17.20 currently, according to contract agreements.
The District also has to bear the cost of incinerating waste at Covanta Fairfax. Those costs have risen as well. In 2019, D.C. was paying Covanta around $35.50 to incinerate a ton of trash, up from $29 in 2010.
Yet while the District’s costs of trucking and burning waste increased, DPW never passed the extra costs on to trash haulers. The tipping fees at D.C.’s two public transfer stations remained steady at $50 per ton.
With private haulers bringing in roughly 96,000 tons of trash in 2018, the District’s losses came to $3.45 million.
Two years after first raising the issue publicly, Cheh, during this budget cycle, inserted a provision into the Council’s budget bill to raise fees at the transfer stations to $70.62, another $10 hike. It would take effect in October, about a year after Geldart’s increase to $60.62. At that rate, it will take at least two more years until the District breaks even.
Her budget language doesn’t mince words about the current $60.62 rate: “This is an improvement, but still lower than the region, and lower than the costs to the District of disposal.”
Another issue, leaders admit, is the city accepting trash originating from outside the District in the first place.
Over the past two decades, the District’s revitalization has been marked by glass high-rises and budget surpluses. But at the city’s nadir in the mid-1990s, the District opened its gates to becoming a quasi-trash dump for the entire region. Until 1994, trash and recycling “generally was not imported into the District of Columbia,” according to a 2000 report commissioned by D.C.
But since then, the amount of outside waste entering the city has skyrocketed. The 2000 report projected that in 1999, the city took in 366,900 tons of imported waste, 58 percent more than what was generated by District residents and businesses.
Moreover, until late 2019, the District, for about a decade, was the cheapest place to dump trash in the region. This investigation compared fees for public transfer stations across the region and found that haulers in recent years saved as much as $25 a ton by crossing the border and dumping their haul in D.C. public transfer stations. To take advantage of D.C.’s low dumping fees, trash haulers truck garbage across the Maryland border in the early hours of the morning, beating rush hour traffic on thoroughfares like Route 50.
The District’s unique status as the region’s trash repository is not lost on Geldart. He’s witnessed it while sitting at transfer stations.
“You can see the trucks that come in that haven’t picked up trash in the District of Columbia,” he said in the July 2019 interview. “Because it’s less expensive for them to dump here. We do need to get our tipped fees close to our regional partners.”
Geldart said that independent haulers should be paying more. “We’re probably somewhere in the $20 to $25—maybe a little bit more than that—per ton below our regional partners right now,” he said. Going by Geldart’s numbers, trash haulers saved $250 for a 10-ton load by dumping in D.C. rather than in Prince George’s County, for example.
One month after that interview, Geldart moved to raise the price of dumping a ton of waste by $10. With an additional $1 surcharge, all private haulers other than Waste Management and Republic are expected to pay $61.62 to unload a ton of waste, according to a District notice published on
Aug. 23, 2019.
“The increase of the Solid Waste Disposal Fee ensures that the fee charged by the District more accurately reflects the cost to operate the facility,” a final notice of the new fee said on Oct. 18, 2019.
But the $10 hike is only half as much as what Geldart said was needed. The $61.62 fee still does not meet the cost of running the facility, transporting the received waste to an incinerator, and the city’s contract with Covanta Fairfax.
In fact, Geldart suggested in a January interview that the fee hike wasn’t detering trucks from bringing waste generated outside the city into D.C.’s transfer stations. “We’re still seeing the same tonnages, which would lead to be we’re still seeing the same trucks coming in,” he said.
“We need to continue to raise our fees,” he added.
The two public transfer stations remain money-losing operations at a critical time. Both stations need repairs and upgrades to make up for deferred maintenance. The District is budgeting $4,100,000 next year for additional upgrades to the Fort Totten station, where renovations are currently ongoing.
“All the trash coming in from the suburbs just compounds the injury and insult,” says Seldman.
The 2002 settlement agreements exacerbate the trouble. Settlement terms with Waste Management allow the company to bring 25,000 tons of trash a month from outside the city into D.C.’s transfer stations. Republic can bring in up to 6,900 tons a month from outside the District—much less than its competitor, but still a large amount. (For reference, Republic hauled a monthly average of 8,048 tons of total waste into D.C. transfer stations in 2017, according to DPW records.)
Settlement terms for Republic, known as BFI in 2002, for imported waste go further than Waste Management’s agreement. “Any such load shall be treated as waste generated inside the District of Columbia,” its agreement says.
Having opened itself up to trash from beyond its border, the District has no way of tracking or tracing its origins.
The only recent study of the issue comes in a passing reference in a 2011 report commissioned by DPW. “Based on responses from private haulers received to date, it is estimated that approximately 10 percent of the waste processed at the DCDPW facilities is imported from outside the District,” said the study, produced by consulting firm ARCADIS/Malcolm Pirnie.
Geldart said the agency hasn’t yet examined how much trash is trucked into the District.
“We will, as we go through the process of doing our solid waste management plan,” Geldart pledged last year. “I don’t care where it’s coming from, but if you didn’t collect it inside the 62 square miles of the District, kind of good to know.”
On March 8, 2018, Councilmember Cheh convened the annual oversight hearing for the Department of Public Works.
The hearing featured testimony from then-DPW Director Christopher Shorter, whom Mayor Bowser appointed in June 2015.
As chair of the Council’s Committee on Transportation and the Environment, Cheh has built a reputation as the Council’s principal legislator on environmental matters. She has proposed or passed legislation on recycling, solid waste disposal and, most recently, composting.
At the 2018 oversight hearing, Cheh questioned Shorter on the cost of processing trash compared with the fees D.C. charges haulers.
“Even when the haulers pay $50.50 a ton, it still looks like we’re losing money,” Cheh said. “Because, as I understand it, the total cost of handling waste in the District is approximately $83 a ton, based on the Compost Feasibility Study.”
Shorter agreed. “There’s some work to do there, and I should say there’s an opportunity to raise fees,” he said. “We do consider those haulers who dispose at our transfer station, tip at our station, as our customers. And so we’re evaluating the fees, and there likely will be changes in the coming years.”
“OK, well, I would hope so, because the distance between the 50 and 83 I think is really significant,” Cheh replied.
Under Shorter, DPW did not raise fees. Cheh’s questioning did not result in fee increases until Geldart raised the tipping fee in October 2019.
Last year, Cheh acknowledged that Waste Management and Republic pay a “very low fee” as a result of the 2002 settlement agreement, but did not take action until this spring. Last month, her committee wrote in its budget recommendations to “terminate or revise settlement agreements with private waste management companies.”
Lisa Kardell, a spokesperson for Waste Management, disputes the Compost Feasibility Study’s findings that it cost D.C. transfer stations $30.70 to process a ton of solid waste. “I can’t comment on the District’s actual operating costs,” she says.
Environmental advocates and lobbyists for private trash haulers for years implored Cheh, DPW, and the city administrator to renegotiate Republic’s deal when it expired in 2018. The District could have raised fees on Republic, but chose to retain the money-losing arrangement.
Young’s office forwarded questions to the Office of Deputy Mayor for Operations and Infrastructure, which replied in a statement: “The District government will not comment on past or upcoming contractual negotiations with private-sector contractors.”
A July 2018 “Trash Transfer Station Fact Sheet” circulated by DPW claims the District actually profits from the settlement agreements with Republic and Waste Management.
“The District realizes significant revenue as a result of the Agreements which is not guaranteed should the agreement (s) be terminated,” the fact sheet declares.
The fact sheet does acknowledge D.C.’s status as a dumping ground for trash beyond its borders, but the most telling line comes under “Goodwill,” where the fact sheet says: “The parties are the major players in an industry with very few players; the District will have to work with them continually in one form or another.”
Cheh does not go as far as advocates like Seldman who believe the arrangement is malfeasance. “I’m not seeing anything nefarious there,” she said.
Republic will continue to benefit from reduced tipping fees for at least another year.
Despite his past criticism of what Seldman blasts as a “sweetheart deal,” Geldart signed an amendment on January 1, 2020, that effectively renewed the original arrangement for another year.
And despite Geldart’s past promises, DPW did not respond to questions about whether it intends to raise tipping fees for private haulers to reduce the District’s losses.
Even with tipping fees at about $60—proposed to increase by $10 in the new city budget—it doesn’t fully cover the cost of D.C.’s operation of the transfer station and its contracts to incinerate the waste, leaving taxpayers on the hook for about $26 a ton.
Plus, the District might lose another $10 million in EPA fines.
On May 21, during a budget oversight hearing of the Transportation and the Environment Committee, Cheh questioned Geldart about “safety hazards” at D.C.’s transfer station on Benning Road NE. The mayor’s budget doesn’t plan a major overhaul of the facility until 2026.
Geldart acknowledged hazards at the station, but suggested the city’s economic picture currently makes it unlikely the overhaul will be moved up.
He then said pollution caused by stormwater drainage at the station has led to the Environmental Protection Agency to consider fines in “around the $10 million range.”
“Have we paid any fines yet?” Cheh asked.
Geldart said his team was working to rectify the runoff to satisfy EPA inspectors and forestall the fines. He added that the EPA would revisit the facility after fixes were made and before issuing a fine.
“That sounds good,” was Cheh’s response before she moved on to questions about plans for a new recycling facility.
The EPA and DPW did not answer questions about the potential fines and status of pollution at the station by press time.
Meanwhile, Seldman, who advises cities across the country in solid waste disposal and recycling, sees a windfall if the District would fix its facilities and realign its fees and costs with private trash haulers.
“The two transfer stations are a gold mine for future revenue,” he says. “If D.C. adjusted the rates charged at its public trash transfer stations, the revenues could be dedicated to waste reduction, recycling, reuse, and composting programs.”
This story was published with the support of Spotlight DC—Capital City Fund for Investigative Journalism.