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I am the Recycling Coordinator for Kauai, Hawaii. About 10 years ago, we
received a $2.2 million EDA grant to build a waste diversion facility
and create jobs in this sector. After many futile attempts to get a
reuse operation in place, I was hired, and we have recently awarded a
contract to a recycler who is proposing to use the facility to divert
new materials that aren't currently handled on Kauai (including #1
plastics, computers, and pallets). Our contractor will also process
materials that are already being diverted by existing commercial
recyclers (these materials include tires, cardboard, paper, and
nonferrous scrap). The contractor has offered to pay a rental value that
is below fair market value to use the space and recycling equipment at
the facility. While this was a fair bid process and this was the best
proposal that we received, our County Council is questioning whether it
is right that we are "subsidizing" the program by allowing the
contractor to pay a rental price that is below fair market value. They
contend that other private sector recyclers are at a disadvantage for
County contracts and commercial sector recycling services.

Since we are subject to a state mandate (no teeth) to implement waste
diversion strategies, I would argue that it is the County's obligation
to utilize the facility to foster competition in recycling and increase
diversion opportunities for residents and businesses. However, there is
a major concern that this contractor now has an unfair advantage.

Our physical isolation creates an atmosphere of limited competition in
the private sector; in fact, we have only one fiber recycler on island,
and this issue is politically charged. Has anyone had a similar
experience in which grant funds are said to compete with private sector
recycling? I'm hoping to gain some legal perspective based on a similar

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