Ballard's Long-Term Recycling Agreement With Covanta Is Criminal

Many Democrats could not be happier to learn that Mayor Greg Ballard will face a formidable foe in Joe Hogsett in next year's mayoral election. Some of us who care more about good government wonder why Hogsett didn't use his position as U.S. Attorney to send Ballard, key members of his administration and his roomful of political cronies to federal prison where they belong for the plundering and theft of public assets they've been perpetrating on Indianapolis taxpayers for the past six and half years. God knows he looked the other way at more than ample evidence turned over to him to mount the biggest public corruption cases in decades in the southern district of Indiana. A 14-year contract Ballard inked with Covanta to handle recycling for the City exclusively is the latest such example.

A one-sided agreement worth well over $112 million to the New Jersey waste disposal company is currently being rammed through the Public Works Board controlled by Ballard stooges. A memo by the counsel for the City-County Council, Fred Biesecker, lays bare just how bad of a deal the Covanta deal means for Indianapolis taxpayers. If approved, the City will essentially be locked into a single provider of recycling services through the year 2028. If any new technology or better recycling opportunities comes along during the next 14 years that the City might choose to implement, it will be required to pay liquidated damages to Covanta equal to $333,333.33 a month for the rest of the contract's term. That's a staggering $4 million a year penalty. "This provision clearly protects Covanta from future competition, but it is hard to see how it benefits the city," Biesecker opines.

The recycling agreement with Covanta doesn't apply to any existing recycling efforts, including the curbside subscription services offered to city residents by Republic. Expanded use of curbside services, however, is discouraged under the agreement with Covanta by reducing the city's portion of steam revenue if curbside collections increase by more than 5% over the preceding year. "DPW will probably say that the city may continue to operate and support existing programs, but they probably won't admit they have a financial disincentive for doing so," Biesecker observes.

Could it get any worse? Believe it or not it does. City taxpayers will be forced to reimburse Covanta for certain "additional costs," which is defined to include any real and personal property taxes levied on its recycling operations. The City will wind up reimbursing Covanta 70% of the taxes levied on its recycling operations up to a cap of $4 million. Biesecker describes this provision as "a sham intended to avoid the requirements of the abatement statute, which include council approval if the abatement property is located in a TIF district." "My recollection is that the Attorney General would not allow either type of provision to be in a state contract," Biesecker said. Under the terms of the agreement, Covanta is required to recover just 18% of waste for recycling, without glass. Critics believe a recovery rate of only 18% is inadequate, although Covanta says it will be its goal to achieve higher rates of recovery.

The deal inked by the Ballard administration with Covanta, in short, couldn't have been worse from the standpoint of the taxpayers if it had signed an agreement with Tony Soprano's Barone Sanitation. Does anyone believe someone was holding a gun to Ballard's head when he approved this one-sided agreement?