City increases payment to Recycle Ann Arbor while delaying RecycleBank contract decision

The city's contract with New York-based RecycleBank, which has been debated in recent weeks, is costing the city about $150,000 a year right now. Several council members say they don't think the program has been effective since it launched last September.

A resolution brought forward Thursday night by four council members — Sabra Briere, Stephen Kunselman, Carsten Hohnke and Marcia Higgins — sought to terminate the city's contract with RecycleBank and to use the savings to increase payments to Recycle Ann Arbor, the nonprofit organization responsible for curbside collection of recycling carts in the city.

But after a lengthy debate, council members decided to postpone making a decision on the termination of the RecycleBank contract until their second meeting in September.

"I want you to think about whether this program is meeting its goals and whether it's meeting the needs of our community," Briere told fellow council members.

RecycleBank incentivizes recycling by rewarding residents with points that are redeemable at retail outlets and restaurants. Since its launch, the program has encouraged more than $240,000 in spending at local businesses through rewards coupons, which have helped residents in Ann Arbor save about $80,000 on purchases, RecycleBank officials said.

Briere, D-1st Ward, conducted an online survey over the past week that garnered responses from more than 600 residents. Of those who said they've signed up for RecycleBank, 80 percent responded that participation in the program hasn't enticed them to recycle more, while 69 percent said they haven't bothered to request or use rewards coupons.

"A lot of people are simply not interested in recycle rewards," Briere concluded, making a case for ending the RecycleBank program at Thursday's meeting.

• View the complete results of the survey here

Atul Nanda, general manager and vice president of operations for RecycleBank’s Midwest region, stood before council and made a case for the rewards program. But his arguments didn't seem to sway council members who were strongly critical of the program.

Council Member Stephen Rapundalo, D-2nd Ward, said he considered the rewards being offered "fairly minimal." He also said he found it "rather telling" that Nanda acknowledged the average homeowner in Ann Arbor saved only $8 from coupons through RecycleBank.

Higgins, D-4th Ward, said she has been "extremely disappointed" in the rewards being offered through the RecycleBank program.

Higgins noted the program is not designed to reward individual recycling behavior. Rather, residents earn points by putting their carts out at the curb, regardless of what's in the carts, and the points are based on the total weight of materials collected along entire routes.

Council Members Margie Teall, Sandi Smith and Tony Derezinski said they weren't ready to give up on the program just yet, indicating it could be a close vote on whether the contract is terminated. Eight votes are needed to break the contract.

The RecycleBank program wasn't on the chopping block until council members were presented with information last month that showed the city's new single-stream recycling system wasn't working out quite as planned. While recycling had increased 20 percent since last July, the total tonnages collected were still 40 percent below expectations.

A consultant had projected the city would collect 18,425 tons of recyclables for fiscal year 2010-11, but the actual number is closer to 10,800 tons. The number of recycling carts deployed as part of the single-stream program also turned out to be 9.2 percent lower than initial projections that anticipated 32,779 carts being deployed.

City officials said the over-projections and subsequent shortfalls left a $337,527 hole in Recycle Ann Arbor's budget this past year.

The approved adjustments to the contract with Recycle Ann Arbor increase the per-month tipping fee from $3.25 to $3.55 per cart. The same proposal failed to get the six votes it needed to win approval last month, but on reconsideration Thursday night it passed easily.

Hohnke, D-5th Ward, is one of the council members who changed his vote. He said he didn't have enough information before, but it seems clear now that most of the issues affecting Recycle Ann Arbor with regard to single-stream recycling are beyond its control.

Even with the approved boost in payments, Mayor John Hieftje noted the city is still paying Recycle Ann Arbor about $150,000 less than it did before the switch to single-stream recycling.

Hieftje, former chairman of Recycle Ann Arbor, said he saw it as an issue of fairness and he wanted to make whole a homegrown organization that founded recycling in Ann Arbor.

"I think this is a company that deserves our support," he said.