Hoping to keep nearly all waste out of landfills, the Austin City Council in 2011 hired two companies to handle the materials from the city’s curbside recycling program, with the projection that the city could see profits of almost $500,000 annually.
It hasn’t worked out that way.
A review of city records by the American-Statesman shows that Austin lost $1.9 million last fiscal year and a total of $2.7 million in the two previous years as a majority of recyclables have fetched less on the open market than the cost to process them. And city officials admit they don’t know the final resting place of some of the items that Austinites put in their blue bins, leaving open questions about the final environmental benefits of recycling.
Yet instead of backing away from its “zero-waste goal,” the city’s answer is to double down, arguing that the more residents recycle, the easier it will be to profitably sell the higher volumes of material locally, rather than shipping it elsewhere in the state, country or even overseas.
To that end, the city plans to build, at a cost of $7.5 million, a “(re)Manufacturing Hub” where businesses will repurpose local waste into new products for sale — and provide a guarantee that recycled materials are actually being put to use rather than ending up trashed.
“Recycling costs less than landfilling,” said Bob Gedert, the head of Austin Resource Recovery.
It was Gedert’s office in 2011 that estimated annual net income to the city of $488,000. That estimate was based on projections of $5.25 million in annual revenue from the sale of recyclables against about $4.8 million in processing costs.
But those revenue projections have turned out to be rosy, given gyrations — or what Gedert called a “general depression” — in the markets for scrap metals, used plastics, glass, newspapers and other recyclables: In the latest fiscal year, Austin got a shade under $3 million for its recyclables, even as processing costs hovered around $4.8 million.
In some recent months, about two-thirds of the materials Austinites put in their blue bins fetched less money in the recycling market than the amount it cost the city to get rid of them.
A cost-benefit analysis
A spate of recent national news articles has raised broader questions about the economic and environmental benefits of recycling.
To make his case, Gedert presented an Austin Resource Recovery analysis that found recycling costs to be $7.35 per customer whereas trash costs $10.70 per customer. That’s because the city picks up recyclables every other week, as opposed to every week for trash, and uses fewer trucks, he said. Gedert hopes to begin collecting recyclables weekly in 2017.
“I have bragging rights now,” Gedert said, as he’s able to say recycling is cheaper in Austin, but he doesn’t know if he will continue to have them.
Slice the numbers a different way, though, and recycling starts to look worse, at least economically speaking.
Folding in tipping or processing fees, administrative overhead and collection costs, recycling costs $81 more per ton than burying the same material in a landfill: $292.41 versus $211.70 for a ton of trash.
But Austin officials say those numbers would be reversed if Austinites sorted their trash more thoroughly.
Nearly 45 percent of materials that Austinites send to the landfill could be recycled, said Austin Resource Recovery spokeswoman Memi Cárdenas.
“If Austinites actually recycled that material, the cost per ton to recycle would be lower than the cost per ton to landfill,” she said, pointing to estimates that taking trash to the landfill would cost $359.47 per ton while recycling a ton of material would cost $261.21.
Picking and choosing
Writing in The New York Times, journalist John Tierney recently argued that most of the economic benefits of recycling come from just a few materials — and that as cities like Austin expand what they take, the costs grow steeper.
A robust discussion has followed, with some recyclers accusing landfill companies of pushing the costly recycling storyline and environmental groups publishing point-by-point rebuttals.
Chief among the complaints of environmentalists: Analyses often fail to account for what they call the true costs of landfills — the potential or real environmental damage to groundwater by landfills, for instance.
“Recycling certainly isn’t a perfect silver bullet that will solve all of our waste problems,” Corey Troiani, a staffer at Texas Campaign for the Environment, wrote on the nonprofit group’s blog in October, “but burning or burying our trash is far worse for the environment and the economy.”
Long term, if the city were to cut back on recycling, it would miss out on potential profits when the recycling market makes an upward climb, said Kerry Getter, CEO of recycling processor Balcones Resources, which holds a contract with the city.
Getter said it is profitable for him to recycle 70 to 80 percent of a city’s waste stream. The rest of the waste stream includes what he calls “1 percenters,” such as plastic bags, where the cost of plucking 160,000 bags out of a jumble of recyclables outweighs what that baled ton of bags could sell for on the market.
The city, though, loses money on some materials that are a major part of its waste stream. Glass makes up about a quarter, by weight, of the blue-bin material. The city has received $11 for every ton of glass it delivers to its recycling contractors but pays at least $75 per ton to process it.
There are bright spots: The city can get between $370 and $1,120 for every ton of plastic it delivers, far more than the per-ton recycling processing fees. But plastics generally make up less than 5 percent of the recycling stream.
Gedert said “cherry-picking” makes recyclables open to contamination, which carries its own costs. Once used to throwing glass or other recyclables into the blue bin, residents will continue to do so — and those materials could get shipped around the world along with other recyclables, only to be thrown in the trash, he said.
Council Member Don Zimmerman says he’d like to see a retreat from the city’s zero-waste goal. Unless Austin is making money out of it, he says, the city “should be out of the waste business entirely.”
Not about the money
Austin City Council Member Leslie Pool, who chairs the council’s Open Space, Environment and Sustainability Committee, said, “As stewards of the environment, it’s not always about making money.”
The city has estimated that Austin’s curbside recycling program reduces the volume of greenhouse gas emissions that the average vehicle would produce when driving 257 million miles.
Gedert said the environmental benefits from using recycled materials, rather than mining and processing raw materials, are huge. But he also says he doesn’t know whether all the recyclable materials in the blue carts actually end up getting recycled — the delivery of material to Balcones and Texas Disposal Systems is the first leg of a long journey for the material, which can end up traveling far and wide before it is repurposed.
That’s partly why he’s pushing the local recycling hub. A city-commissioned study found the recycling industry locally already directly accounts for about 1,300 jobs paying at least $56 million.
Getter, of Balcones, is sure none of the materials end up trashed in a landfill.
“People don’t pay to have materials shipped to them and then bury it,” he said.
Texas Disposal Systems, which processes the remainder of the city’s recyclables, did not respond to requests to be interviewed for this story.