The garbage hauler that handles Springfield’s trash has not paid millions of dollars in fees it owes to Lane County, according to the county. That could mean higher fees for Springfield residents at transfer stations, and could impact garbage bills for everyone if local governments can’t reach a solution.
Every time most Lane County residents pay their garbage bill, a portion of their money is set aside for something called a “system benefit fee.” It’s supposed to go to the county to help cover the cost of operating its 15 transfer stations and other recycling programs. But Springfield’s hauler, Sanipac, hasn’t been sending that money to the county in at least a year.
That’s according to documents KLCC obtained through a public records request, as well as interviews with county officials.
The decision to stop sending those fees to Lane County came around the same time that Sanipac’s parent company, Waste Connections, started exporting Springfield’s waste to its own private landfill outside Medford. EcoSort, which is also a Waste Connections company, has also been exporting waste from all over the county, and is also not paying fees.
Lane County Administrator Steve Mokrohisky told KLCC that county officials have analyzed rates that communities pay their haulers, and he worries Waste Connections may still be charging Springfield residents for services the county provides, but is keeping the money instead.
"The rates are higher in some cases than other rates around the county, and it’s unclear why the rates would be so high if that system fee isn't being remitted," Mokrohisky said.
The fee was created decades ago to cover the cost of programs to discourage illegal dumping, keep hazardous household chemicals out of the water supply and educate residents about recycling options. Some of those are services the county is legally obligated to provide.
Regional impact
According to shareholder materials, Waste Connections is the third-largest waste company in the U.S. and is on track to make nearly $9.5 billion in revenue this year. KLCC reached out to Waste Connections’ communications team and did not receive a response.
An attorney who represents two Waste Connections companies, Sanipac and EcoSort, did send letters to the county responding to its concerns Tuesday. E. Michael Connors wrote the company disagreed with the county’s interpretation and isn’t required to retroactively pay the system benefit fee.
Lane County Public Works Director Dan Hurley said the rules around system benefit fees were created in the 1990s after private companies started diverting waste to the cheaper Coffin Butte Landfill near Corvallis. Local governments agreed that regardless of what landfill a community’s waste ends up in, everyone should pay into pollution prevention programs.
Hurley said losing about $5 million in revenue, mostly from Springfield, and some from Cottage Grove, may mean the county could have to start charging Springfield residents more for waste services.
"These household wastes are hazardous, and they're small quantities so people could dump them down the sink, or in their backyard, but that's not what we want to have happen,” Hurley said. “If we have to charge fees for those services, people are going to be less likely to use them and the waste won't go to the proper place."
Hurley said Cottage Grove’s hauler has agreed to work with the county on paying fees.
CleanLane project
The county also relies on fees from haulers to cover its share of a planned, $150 million food and recycling diversion project called the IMERF, or CleanLane, facility.
Waste Connections – through its subsidiary Sanipac – has been fighting that project on a few fronts including through land use laws. A Sanipac attorney and an association for small garbage haulers testified against the project at the Oregon Land Use Board of Appeals last month, with Sanipac saying the county violated its own code.
Hurley said Waste Connections’ diversion has impacted revenue for that project, and left the county short of the cash it needs to maintain and operate the landfill, as well as other services like nuisance property clean up and transfer stations.
"We'll either need to reduce our expenses by reducing services or eliminating services, or increase our revenue by looking at fee adjustments,"
Hurley said.In their letter to the county – the attorney representing Sanipac and EcoSort accused the county of trying to collect the fees in retaliation for the company’s legal objections to the CleanLane project.
“Sanipac was entitled to express its opinion during the county’s public process and should not be punished for doing so,” Connors wrote.
Next steps
Lane County Commissioners will ultimately decide how to move forward.
During Tuesday’s meeting, Chair David Loveall, who is also the commissioner that represents Springfield, urged caution.
“There’s Sanipac logos at every kids baseball field and football field around this area,” Loveall said. “I would like to be respectful and treat them fairly and not create accusations within the public sphere that make folks think they’re less than incredibly integrous.”
Mokrohisky told Loveall that county staff are trying to be fair and provide accurate information.
“This isn’t about pointing fingers, it's about asking questions,” he said. “We want to transparently understand the facts ourselves so we can support this community system.”
Garbage, recycling and waste companies must have a franchise agreement with cities to operate within their borders. Eugene has several, competing haulers. In Springfield – Waste Connections company Sanipac is the only residential hauler with an agreement.
Niel Laudati, Assistant Springfield City Manager, said the city has been meeting with Waste Connections in hopes of resolving the situation.
Laudati said Springfield city staff are preparing information and options for the City Council, which will eventually have the responsibility of deciding how to resolve this challenge.
"Springfield wants to make sure that their rates are low and they're getting what they pay for,” Laudati said. “That's something that's very important to the council, whether it's garbage rates, or water and sewer rates. All of those things, they take it very seriously."
County governments can’t enforce their own code in city limits. Lane County officials are trying to work with Springfield to create a new intergovernmental agreement that will grant the county the authority to take enforcement action against Waste Connections.
