[greenyes] FW: [MassRecycle] New York City recommits to recycling!

[Jenny Gitlitz <jenny.gitlitz@no.address>]

------ Forwarded Message
From: "Katrina Rideout" <kerideout@no.address>
Reply-To: MassRecycle@no.address
Date: Tue, 14 Sep 2004 14:40:51 -0400
To: MassRecycle@no.address
Subject: [MassRecycle] New York City recommits to recycling!

In case folks haven't heard, the NYC mayor's office announced today that
they'll sign a 20-year contract for recycling, including plans to construct
a $45 million MRF on the Brooklyn waterfront.  Text of article below...

Link: http://www.nytimes.com/2004/09/14/nyregion/14CND-RECYC.html

Mayor Recommits to Ambitious Recycling Pact
By IAN URBINA

Published: September 14, 2004


The Bloomberg administration announced today that it will sign a 20-year
contract with one of the nation's largest recycling companies, a move that
assures the city's broad recommitment to recycling.

The most ambitious component of the plan is the construction of a $45
million plant on the Brooklyn waterfront to recycle all the city's
residential metal, glass and plastic, officials said at a news conference
today at the site.

The announcement comes just two years after the city largely abandoned
recycling as an economic drain in a time of budget cutbacks. While the
Bloomberg administration has gradually reinstituted residential recycling
programs, the contract reflects the administration's bottom-line conclusion:
as landfill prices increase and technology improves, recycling is the most
cost-effective way to get rid of much of its garbage.

The commitment to recycling solidifies what has been an on-again, off-again
program that left New Yorkers guessing from year to year what to do with
their garbage. The debate has often been positioned between environmental
concerns and rudimentary questions about whether recycling could ever be
economically feasible to governments facing tight budgets. With this
contract, the Bloomberg administration has settled the debate.

Elected officials and industry experts say the city's vote of confidence in
the virtues of recycling is expected to have profound repercussions
nationwide as local governments decide whether to pursue aggressive
recycling programs.

"Much like market analysts watch the Federal Reserve in order to assess
monetary issues, many people look to New York City when it comes to
municipal policies," said James Thompson Jr., president of Chartwell
Information, a market research firm in San Diego that analyzes the waste
management industry. "I think the repercussions of this will be pretty
widespread."

Under the contract, one of the largest scrap metal companies in the country,
the Hugo Neu Corporation, based in Manhattan, will invest about $25 million
in the plant, said officials who have been briefed on the contract. Hugo Neu
recycled most of the steel from the World Trade Center.

Another industry official explained that the city would spend about $20
million to repair a pier so that it could accommodate barges that will carry
roughly 90 percent of the material to the plant.

The plant, scheduled to be finished by 2007, will be on city-owned land at
the South Brooklyn Marine Terminal in Sunset Park.

When the contract expires, the city will maintain most of the rights over
the operation.

"The mayor deserves credit for forging a deal that marries sound
environmental policy with good business," said Mark A. Izeman, a senior
lawyer at the Natural Resources Defense Council. "The environmental
community has been advocating this for years, and it's great news that
recycling is here to stay."

A number of factors explain the city's shift away from a policy that shunned
recycling just two years ago, when the mayor argued that New York could save
$40 million annually by dumping the materials into landfill rather than
recycling them. Recent studies, including one by the city comptroller's
office, indicate that initial numbers were significantly off the mark.

Furthermore, landfill prices have also shot up in the last several years.
But most of all, Mayor Michael R. Bloomberg has come to the view that the
savings of recycling lie in long-term contracts with recycling companies
rather than short-term contracts with less efficient waste-removal
companies, as is the current practice.

Carmen J. Cognetta, counsel to the City Council's Sanitation and Solid Waste
Management Committee, said the city currently pays around $50 per ton to
recycle metal, glass and plastic, but that cost will drop to around $40 per
ton once the sorting operation is built.

It will likely drop even further, perhaps to around $20 per ton, as Hugo Neu
picks up a larger share of the more lucrative paper market, which is part of
the terms of the contract, he said.

The cost of paying haulers to bury the material in landfills is now around
$70 per ton, as the cost of sending it to out-of-state landfills has risen
46 percent in the last three years, according to city statistics.

By offering a long-term commitment, the mayor has enticed Hugo Neu to build
the type of highly mechanized operation needed to sort materials cheaply and
efficiently.

In the past, the city has offered five-year contracts, often with 10-day
cancellation clauses. Under these contracts, companies have been reluctant
to invest in more than the most basic facilities that consist mostly of
low-wage workers who sort the materials from conveyor belts.

In larger and more advanced plants like the one Hugo Neu will build in
Brooklyn, manual labor is supplemented by modernized equipment that uses
heavy magnets to pull off metals, blowers to sift paper and plastic and
optical devices to separate different colors of glass.

The long-term contract also allows the company to reach better deals with
buyers of the materials, further driving down the cost to the city.

And by placing the sorting operation within the city, the contract will
lower the high transportation costs the city now pays to cart the materials
farther away.

Once the plant is operating, the city's sanitation trucks will still pick up
the recyclables, then take it either directly to the Brooklyn complex or to
one of two transfer stations owned by Hugo Neu.

The city is also considering whether to send the materials through the
city's marine transfer stations once they are reopened.

A local lawmaker involved in sanitation issues praised the city's approach.

"With this contract, the city does for metal, glass and plastic what it did
for paper nearly 10 years ago," said Councilman Michael E. McMahon, a Staten
Island Democrat and chairman of the Council's waste management committee.

In 1997, the city offered a 20-year contract for 50 percent of the city's
paper recycling, and Visy Industries, an Australian recycling company,
stepped forward to build a $250 million processing plant on Staten Island.

"That contract gave paper recycling a permanent home, it attracted the
needed investment to build permanent infrastructure and now the city gets
amazing returns on it," Mr. McMahon said. "This contract holds the same
basic promise."

The recycling contract is also a precursor to the mayor's eagerly awaited
20-year waste management plan, which is to be announced by early October.
That plan will detail the city's plan to deal with its trash now that its
huge Fresh Kills landfill on Staten Island has been closed.

Since taking office, the mayor has struggled to get a solid grasp on the
city's trash problems. In August 2002, he announced an ambitious schedule
for reopening the city's marine transfer stations, only to backtrack once he
realized that his goal was much more expensive and complicated than planned.

In a report card in July, the mayor gave himself an F in waste management
for failing to create a plan for the city's trash problems.

With this contract, however, the city will lock firm plans into place for
the removal of about 20 percent of the city's total waste flow.

"The mayor might have given himself an F on the trash issue not long ago,"
Mr. Izeman said, "But in striking this deal, he just turned in an A paper."



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--Jenny

Jennifer Gitlitz
Research Director, Container Recycling Institute

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