Surging costs cause some Michigan cities to rethink recycling programs
China is no longer accepting American recyclables. That’s caused the market for them to crash, dramatically increasing costs for municipal recycling programs in Michigan and the United States.
by Jim Malewitz (Bridge)
Shortly after taking office in 2007, Westland Mayor Bill Wild launched “Mission: Green,” a program to slash carbon emissions, limit stormwater runoff and improve quality of life in the Detroit suburb.
A cornerstone of the plan: Introducing single-stream, curbside recycling to Westland’s 82,000 residents. It was a success, touting a 78 percent participation rate and diverting more than 80 million pounds of trash from landfills in eight years.
Not anymore.
Last month, the city decided to reroute recyclables to the garbage heap after the company that processed Westland’s materials — ReCommunity of New Boston — more than quadrupled its rates, which would have cost the city more than $300,000 extra each year.
Westland, Michigan’s 11th largest city, is among local governments nationwide struggling to pay for recycling after China last year halted imports of recyclables, triggering a global plunge in prices for paper, plastics and other materials.
“It’s a global problem, it’s a state of Michigan problem, it’s a local problem,” Wild, who recently sold an auto recycling business his family had operated for decades, told Bridge Magazine.
Cities nationwide have canceled recycling programs, and more could follow in Michigan.
Toronto-based GFL Environmental, the largest waste hauler in Southeast Michigan with contracts in 65 communities across the state, recently sent letters telling local governments they’d need to pay significantly more to continue recycling services.
“The market has collapsed,” said Joe Munem, a spokesman for GFL. “It’s not that it’s collapsing or thinking of collapsing. It has collapsed.”
‘Wrong end of the stick’
The market turmoil comes after years of efforts to improve recycling in Michigan, which is home to cheap landfills and recycles only 15 percent of its waste. That’s the lowest in the Great Lakes region and well below the national average of nearly 35 percent, according to the U.S. Environmental Protection Agency.
On his way out of office late last year, former Michigan Gov. Rick Snyder cut a budget deal to give local recycling efforts another $15 million a year. But those efforts may be offset by global economic pressures.
Some communities are suffering more than others.
Those that belong to regional recycling efforts or have longer-term contracts can weather the storm, but those on short-term contracts are at the mercy of private recyclers, said Mike Garfield, executive director of the Ann Arbor-based Ecology Center, a nonprofit that has advised communities on recycling plans.
“The cities have gotten the wrong end of the stick on this issue, unless they stood up for themselves previously,” Garfield said. “The recycling processors have made money when markets were good, and now they’re passing on their costs 100 percent.”
That’s what’s happening in Westland, which had paid $18 per ton to truck the city’s recyclables 15 miles south to ReCommunity’s facility in New Boston. The company was recently purchased by waste juggernaut Republic Services, which makes more profit by hauling trash to landfills and did not respond to messages from Bridge.
In February, Wild learned the company was increasing Westland’s prices to $80 per ton on its month-to-month contract. That would cost the city at least $310,000 more per year, eating into its $65 million budget.
Wild initially proposed sending Westland’s recyclables to a Detroit incinerator — operated by Detroit Renewable Power — that has a long track record of pollution violations and complaints about terrible smells.
The Westland City Council rejected that contract after loud opposition from folks in Westland and Detroit, including U.S. Rep. Rashida Tlaib, D-Detroit.
For now, Westland will send recyclables to a landfill at a cost of $28 per ton. But as the city negotiates with ReCommunity and searches for less expensive options, Wild still wants residents to continue filling recycling bins, even though their contents are going to landfills.
“The last thing we want to do is pull the plug on our recycling program,” Wild said at a recent council meeting. “Once we change people’s behavior … who knows if we’ll get them back?”
China’s ‘sword’
In the recycling world, 2018 was the year of the sword.
Once a huge buyer of recyclable scrap from the U.S., China last year banned imports of 24 types of solid waste and adopted strict limits for contamination in other materials it accepts from overseas.
China’s “National Sword” policy addressed concerns that too many tainted materials originally labeled as recyclables had piled up in Chinese landfills and harmed the environment.
China’s exit from the global market created a glut of commonly recycled materials like mixed papers and plastics, slashing their worth and giving local governments a crash course in waste stream economics.
“We’re working with these communities — our customers — to try to make sure that we keep curbside recycling as a viable option,” said Munem, the spokesman for GFL Environmental waste hauler, which contracts with Republic Services to process recycling.
But maintaining municipal recycling can only happen by increasing fees “just to get to where we’re not hemorrhaging money,” Munem said.
Experts say the policy change highlights the problem of contamination – mixing garbage into recycling, which slows processing facilities and damages equipment.
“As soon as [residents] chuck in the open container of Tide detergent that still has detergent in it — and that leaks over everything else, everything else becomes garbage,” Munem said.
Weathering the storm
China’s sword hasn’t cut all local governments in Michigan equally. Some are bleeding less, including Emmet County, which has become a regional recycling hub in northern Michigan.
The county operates its own recycling plant and typically raises more than a third of its recycling revenue through sales of the material — most of which goes to Michigan manufacturers. (Bottles are sold to Clean Tech Recycling in Dundee, for instance, and paper cartons go to Great Lakes Tissue a tissue paper manufacturer in Cheboygan.)
The market plunge means the county is earning about 20 percent less from its recycling sales, according to county figures. But the county also owns a waste transfer station, and fees it collects from haulers help offset losses, said Andi Shepherd, director of Emmet County’s recycling program.
Additionally, Emmet’s operates a dual stream recycling program, meaning residents themselves separate paper fibers from containers. That cuts down on labor and yields cleaner materials that are easier to sell, Shepherd said.
Emmet County and other community operators of recycling facilities are better equipped to handle the changing market because they could sock away earnings when prices for recyclables were higher, said Garfield of the Ecology Center.
In southern Oakland County, the regional corporation SOCCRA recently installed a new recycling facility and offset rising costs by processing and selling materials from outside its 12 member communities.
Prices have fallen for many items, but the agency still has buyers for its recyclables and is in discussions with corporations and communities about expanding services, said general manager Jeff McKeen.
“I wouldn’t call it a crisis,” said McKeen, whose group represents cities including Berkley, Birmingham, Royal Oak and Troy with a combined population of 283,000.
Whatever it’s called, the plunging prices have leaders of other communities considering banding together.
The Conference of Western Wayne, which represents 18 communities in Wayne County and 700,000 residents, recently launched a task force to consider options including operating a recycling facility, Wild said.
In nearby Washtenaw County, leaders of communities including Ann Arbor, Dexter and Saline are considering forming a similar group to handle recycling, MLive reported this month.
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