Sunday, October 20, 2013

Thursday, May 19, 2011

Ann Arbor Employee Car Allowances

In our effort to help the city identify some areas where cost reduction could occur without cutting citizens services I asked my Council member if he could supply a list of the city employees that receive a monthly car allowance. The following table is the information that we received.

Detail Earnings by Employee
City of Ann Arbor Master Company
Select: Company is CAA - City of Ann Arbor and Earnings Code is CAR
Sort Order: Service Area(Asc), Service Unit(Asc)
Pay Period Range: 201104010 - 201104309
City AttorneyCity AttorneyPostema, Stephen K.$330.00
City AdministratorCity AdministratorFraser, Roger W.$400.00
Community Services&nbspParks & RecreationStraw, Jeffrey D.$200.00
Community Services Parks & RecreationSmith, Colin$200.00
Community ServicesPlanning & DevelopBahl, Sumedh$300.00
Community ServicesPlanning & DevelopWelton Jr., Ralph R.$150.00
DD AgenDDAPollay, Susan$315.63
Finance & AdminCity AssessorCourtney, Michael S.$180.00
Finance & AdminCity AssessorWeber, Annette M.$180.00
Finance & AdminCity AssessorForner, Patricia R.$180.00
Finance & AdminCity AssessorBalogh, Amy$180.00
Finance & AdminCity AssessorPetrak, David R.$180.00
Finance & AdminCity AssessorDoletzky, Ryan E.$180.00
Finance & AdminFinance AdministrationCrawford, Thomas E.$350.00
Public ServicesField OperationsKonwinski, Julian M.$ 50.00
Public ServicesFleet ServicesCrum, Dennis L.$300.00
Public ServicesPublic Services AdminKulhanek, Matthew J.$300.00
Public ServicesPublic Services AdminCariano, Robert L.$300.00
Public ServicesPublic Services AdminMcCormick, Susan F.$300.00
Public ServicesSystem PlanningHupy, Craig$300.00
Public ServicesWastewater Treatment Kenzie, Earl J.$300.00
Safety ServicesFireDziubinski, Edwin J.$375.00
Safety ServicesFireHubbard, Ollice$375.00
Safety ServicesPoliceSeto, John Y.$375.00
Safety ServicesPoliceBazick, Gregory D.$375.00
Safety ServicesPoliceJones, W B.$400.00


Why are we giving so many employees such large car allowances? Why are we encouraging city employees to live outside the city by subsidizing their commuting costs? It seems that the city's policy of encouraging alternate transportation does not apply to the employees. Is it only the taxpayers that should walk or take the bus so that there would be less congestion for the city administrators?

The parking for city employees is also provided. That is one of the reason the downtown parking rates are so high. If some spaces do not contribute to the cost of the parking structure the remaining spaces must make up the difference.

Eliminating these two perks would save about enough to avoid one of the proposed police or fire fighter layoffs.

Karen Sidney

Saturday, May 14, 2011



The FY2012 budget is on the May 16, 2011 Council agenda. Under our city charter, the city administrator proposes a budget which goes into effect unless 7 council members vote to change it. The proposed budget continues the trend of cutting basic services, especially police and fire, which will see 10 layoffs plus elimination of vacant positions. Mayor Hieftje and his supporters on Council insist that Ann Arbor is better off than other cities and the cuts are unavoidable result of the recession.

The truth is that Ann Arbor is better off than other cities because we pay higher per capita taxes than other cities, even with all that U of M and city park land off the tax rolls. There are other solutions to the current fiscal mess the Mayor and his supporters have created besides continuing to slash basic services. Below are my suggested changes to the budget.

Eliminate pork projects

1. A $639,422 contingency is included in the general fund budget. This contingency is in the same line item that was used in the 2011 budget to cover the Justice Center overruns. If the city administrator can't explain what the money is for, it shouldn't be in the budget. The budget should be amended to eliminate this contingency and restore police and fire positions.

2. $2.2 million for more new garbage trucks is included in the fleet fund budget. The fleet fund is an internal service fund. According to the last audit the city has an all time high of 28 garbage trucks, up from 18 the year before. Most of the $2.2 million is for new residential collection trucks even though Sue McCormick says she plans to outsource residential collection. Apparently the garbage company that gets the residential collection monopoly also gets a big taxpayer subsidy in the form of new trucks. Residents get higher fees and fewer services. Cancel the new trucks and restore services to residents.

3. $1 million for new parks vehicles is also included in the fleet fund budget. Parks needs a lot of things but $1 million in new vehicles is not high on the list. Cancel the new vehicles and transfer the $1 million to the parks millage fund, overseen by the Parks Advisory Commission.

Eliminate overcharging for internal services

Internal service funds are supposed to be break even but the latest audit shows the city's internal service funds have built up a cash hoard of about $20 million. That means these funds have overcharged other city departments $20 million. Internal service funds are used to divert money that should be used for basic services to more ego projects. $3.3 million in overcharges by the insurance fund were used to help pay for the new Justice Center.

When the IT internal service fund was established in 2006, the charges for IT services doubled. In 2006, the charges for fleet services also doubled while City Hall touted efficiencies from the $35 million new maintenance facility. The Increased charges have allowed the city's top management to pursue more ego projects at the expense of basic services. Your street may not get plowed, but when the plow finally comes, it's state of the art.

Establish a new city policy to refund the overcharges.

More doers and fewer managers

In 2002, the city had 958 employees. The city administrator's 2013 budget proposes 688 employees, a 28% drop. But the pain from staff cuts has not been shared equally. By 2013 police and fire will have lost 35% of their staff compared to 2002 levels while the city attorney and district court have lost about 12% of their staff and the city administrator service area has lost 16%.

Winners include the DDA, whose staff has doubled, and public services area management. Sue McCormick oversees the Public Services area. Compared to 2002, the proposed 2013 budget has about 25% more people planning and overseeing capital projects, 33% more people in public services administration but 33% fewer people assigned to field operations, which is responsible for performing services like plowing, tree maintenance and road repair.

One example of the shift from doers to managers is forestry. Before the Roger Fraser reorganization, the city had a city forester who was responsible for taking care of our trees. When our last city forester, Paul Bairley, left, the city forester position was eliminated and replaced by an Urban Forester & Natural Resources manager (Kerry Gray) and a Field operations Supervisor III (Kay Sicheneder). The result has been big spending on a tree inventory and an urban forestry management plan while our trees continue to deteriorate.

Restore safety services positions and eliminate management positions.

Fewer Consultants

The city has become addicted to consultants. The city has even posted a RFP for a consultant to help the police chief decide who to promote. Recently, Sue McCormick told Council that there was no one on city staff capable of conducting a public meeting.

City staff needs to stop hiding behind consultants. We don't need to pay consultants to justify decisions that have already been made. We also don't need to pay consultants to conduct public meetings in order to manipulate us to make the “right” decision. City employees should be the ones talking to the public. The city staff member conducting the meeting should be the individual with decision making authority, not some junior staff member sent to absorb public anger about an unpopular decision.

Maybe if Roger Fraser, Mayor Hieftje and the council members who pushed the new justice center had had to face the public in a give and take public meeting, we might not have a new $50 million building next to city hall, which has been nominated for the dubious distinction of being the ugliest building in America.

Just say no to consultant contracts.

*Karen Sidney is an attorney and CPA. She has an expertise in forensic accounting, which is the art of finding out where the money is going when people can't or won't tell you.

Friday, April 29, 2011

Ann Arbor Park Funding


The Ann Arbor Parks are funded from two sources. One is the city general fund which obtains money from the general city property taxes. The other is from special additional taxes that the citizens have agreed to pay, the Parks Millage.

In 2006 the Ann Arbor City Council proposed a new Parks Millage of 1.1 mills. This millage replaced two smaller millages that expired that year. The new tax was expected to generate slightly less than $5 million annually. This was approximately $1 million more than the millages it replaced. The increased tax was approved by the voters in November of 2006.

There was substantial popular concern that approving the additional millage would result in a shift in the Parks funding from the general fund to the millage rather than increasing the actual amount available for maintenance and improvement of the parks. To reduce this concern and encourage the voters to pass the increased tax, Council passed two resolutions, promising that if the 2006 park millage was approved the funding for parks from the general fund would increase or decrease by the same proportion as the general fund increased or decreased.

The first resolution passed in August 2006 stated that the funds for Police and Fire (Safety Services) were to be excluded from the calculation of the increase or decrease of the general fund.  This was amended in October to remove the exclusion of Safety Services from the calculation.

Both resolutions included a statement that the parks millage money would not pay municipal service fees. This was to avoid the transfer of fees from the millage to the general fund by  a "back door" service charge.

The purpose of this report is to test if the city is following Council's 2006 promise to the citizens.


The data used in this analysis are from the cities and the city's proposed budgets. The data for the years 2007 through 2010 are from the audited financial reports . The data for the years 2011 and 2012 are from the proposed budgets.


First let's look at the general fund

The red line is a linear regression line fitted to the data. This is a common method to predict trends and is often called a trend line. The trend is clearly flat.

The large increase in 2009 was the cost of the police early retirement. If the data from 2009 did not include the early retirement, the result would still be the same, or at most any trend would be very minor.

It should be noted that when Council member Taylor and others refer to the multimillion dollar “short fall” of the current budget this is not so much a short fall from past budgets as it is a short fall from the additional amount they wish to spend or have already spent.


Now consider the contribution from the General Fund to the Parks.

Here is that chart

The additional taxes were first collected in FY 2008. The council resolution promised that Parks funding from the general found would not decrease if the voters approved the additional millage. Yet in every year since 2007 the funding has been reduced. The average decrease has been 14%. The trend is that decrease is increasing each subsequent year. The rate of decline is $290,000/year.

The parks appropriation have not followed the council resolution, as ammended in October 2008.

At the April meeting of the Parks Advisory Commission meeting Colin Smith stated that Parks staff relied on a document, “The Policies for Administration of the November 7, 2006 Charter Amendment” as their guide for following the Council resolution.

Council member Mike Anglin requested a copy of this document. The pdf file he received is here.

It is note worthy that the policy park staff believe they should follow is not the final amended resolution passes by Council. Their policy is based on the August resolution. Even so it is interesting to test if the park allocations agree with their policy statement.


Lets look at the safety Service Funds next. Here is the chart of just the police and fire budget; that is the safety services.

The trend in the Safety Service fund dollars, including the budgeted 2011 and 2012 is flat. That is, there isn't any apparent increase or decrease. Again the bulge in 2009 is cause by the additional cost for the early retirement. Without this transfer the trend line would probably have a very slight positive slope.


Since the trend of the general fund is flat, and the trend of the Safety Services is also flat we would expect the trend of the difference to also be flat. Here is a chart of those calculated data.

As expected, the trend line is flat. It is interesting to note that if the budgeted dollars for 2011 and 2012 are excluded, the slope of trend line for the years 2007 through 2010 is positive. The slope is nearly $1 million/year. The confidence in this value would be low because it is based on a small number of data points. Still it is strong indicator that Safety Services funding was cut more in that period than the remaining General Fund.

Again, here is the chart of the allocation of park funds from the general fund.

It is quite clear that the trend in the park allocation from the general fund does not follow either the Council resolution or the inaccurate Park Policy Statement.


There is also another part of the story. As stated in the second paragraph, the Council resolution at the time the millage was proposed included a statement that the parks millage money would not be used to pay municipal service fees but could include IT and fleet service charges.

The city has not imposed a “municipal service charge” but it has greatly increased the allowable internal charges paid by the millage.  It is reasonable that the millage should pay some of these charges.  But is unreasonable that they should be increasing at such a rapid rate when services and personnel are decreasing. 

Initially in 2006 the charges were about $300,000; they are now budgeted to be over $1.3 million in FY 2012. The administration is doing exactly what Council attempted to prevent in the 2006 resolution. Internal service charges are being used to transfer money from the parks millage to the general fund. Obviously this reduces the millage resources that the citizens agreed to pay for parks improvement and maintenance.

Assertions by Others

The assertion that the city has not kept its promise made to the citizens  when the millage was proposed is not new. This allegation was made in 2007 by Council member Robert Johnson, Sierra Club Chairman; Doug Cowherd, and former Parks Advisory Commission chairperson Linda Berauer. Here is a link to the a video of the Council discussion.


The city has not kept it promise to the citizens that “if the 2006 park millage is approved by the voters the future funding for parks from the general fund would increase or decrease by the same proportion as the General Fund. It does not matter whether the total general fund is used in the calculation or the General fund excluding Safety Services.

The city has followed the words of the Council resolution prohibiting applying a muncipal service charge to the parks millage funds. It has not kept the spirit of that promise since the allowable charges have been greatly increased. This further reduces the amount of funds available for park operation and maintenance.

The transfer of funds opposed by  Robert Johnson, Doug Cowherd, and Linda Berauer; expressed in the videos from May 2007 have consistently and systematically occurred after the voters approved the millage increase.

Karen Sidney
Glenn Thompson

Karen Sidney is a CPA and attorney and a shareholder in the local CPA firm, Conlan & Sidney PC. Her practice focuses on providing tax advice to small businesses and individuals and litigation support services. For the past several years she has used her investigative accounting skills to dig into city finances.

Glenn Thompson is a licensed professional engineer with a background in matematical statistics and data analysis.

Thursday, June 10, 2010

SingleStream Recycling - Additional Recycled Plastics


The Ann Arbor City Council recently voted to spend over $6.7 million dollars to convert the recycle program from dual stream to single stream recycling. The primary argument made to justify the expense was that additional materials would be collected and that the sale or diversion of these materials from the landfill would pay for the additional cost of the program, including the investment for the conversion.

While the arguments seem logical in a qualitative manner, it was disappointing that the proponents of the transition to single stream recycling did not provide any quantitative data on the amount of additional material that might be collected, the value of this material and the environmental advantage of recycling it.

In both programs paper and cardboard, are collected, this is the fiber stream. Glass, plastics aluminum and steel containers are also collected, the container stream. In dual stream recycling these two streams are separated by the citizens. In single stream recycling all materials are combined at the household source and then later separated by a contractor.

At present, almost all types of paper and cardboard are recyclable. This will not change with the conversion to single stream. However, additional plastics will be allowed in the container component of the single stream program. It is the sale of these materials that must pay the additional $6.7 million cost of conversion to the single stream program if the program is to be cost effective. This report will quantify the additional plastics that will be included in the single stream program.

This report investigates:

How much additional plastic will be recycled in the single stream program?

What is the economic value of this material, or value of diverting it from the landfill?

What is the benefit of recycling this material?



At present only type one and type two plastics can be recycled. Under the proposed single stream program plastics of types 4, 5, 6, and 7 will also be recyclable. But there are additional constraints on the specific items that may be recycled in either program.

First, in the case of most plastic objects the generic type of the plastic is designated by a symbol molded into or marked on the object. The symbol is a triangle of arrows with a number inside the triangle. The number defines the type of the plastic. This labeling system was developed by the Society of the Plastics Industry. It should be noted that the presence of the symbol only designates the type of plastic, not that it is, or is not recyclable. In fact the Society of the Plastics Industry specifically instructs manufactures:(1)

". . . Do not make recycling claims in close proximity to the code" and

". . . Do not use the term "recyclable" in proximity to the code."

A plastic is not recyclable just because the symbol and numbers are molded or printed on the object. The present Ann Arbor recycling program places the following additional constraints on the plastics which may be recycled. (2)

Includes bottle-and-screw-top jar shapes only, marked 1 or 2 (PETE or HDPE), such as milk jugs and bottles used for laundry, cleaners, cooking oil and water. No tubs, such as for margarine or yogurt.  Remove and discard all plastic lids. “

Under the single stream recycling program the following plastics may be recycled: (3)

“As part of the upgrade of the city’s Materials Recovery Facility (MRF) in mid-2010, Ann Arbor will add and recycle all clean plastic bottles and tubs marked #1, #2, #4, #5, #6, and #7. Bulky plastic HDPE #2 items such as buckets, crates, trays, and outdoor furniture will also be accepted.

Please note that the plastics to be accepted must have a bottle (check for a neck) or tub shape (such as a yogurt tub, carryout plastic tray, microwave freezer food tray, berry box, etc.) The plastics meeting the shape criteria must be marked with a recycling number.

No #3 (PVC for PolyVinyl Chloride--used for some shampoo and food bottles), polystyrene foam (aka Styrofoam™), biodegradable plastics (marked PLA or compostable), or plastic bags. “


In order to consider the effect of converting to dual stream recycling we need to consider each type of plastic and the amount that can be recycled at present and in the proposed single stream program. The plastic containers in one household were carefully reviewed. In addition plastic objects in several stores were also reviewed to determine the types of plastics that might be recycled.

The following paragraphs give the symbol for each plastic and the types of additional objects that may be recycled in the single stream program.

TYPE 1 - polyethylene terephthalate (PETE)

Type 1 plastic is currently recyclable if it is a bottle. It should be noted that carbonated beverages sold in type 1 bottles are returnable for a $0.10 deposit in the State of Michigan. PETE is clear, strong and does not break. It is probably the most common plastic used for food and drink containers.

Under the proposed single stream recycling program additional containers that are not bottles will be recyclable. There are two common forms, one is the cylindrical containers commonly used for olives and similar foods selected and filled by the customer in the food store. The other is the rectangular light tubs or clam shell containers used for nuts, fresh and dried fruit, other prepared foods and some produce.

TYPE 2 - high density polyethylene (HDPE)

HDPE is the plastic most often used for milk containers. It is usually translucent, but may be opaque and colored in some instances. Type 2 plastic is currently recyclable if it is a bottle or a screw top food container.

Under the single stream program all type 2 clean plastic bottles and tubs will be recyclable. In addition, bulky plastic HDPE #2 items such as buckets, crates, trays, and outdoor furniture will also be accepted. Type 2 plastic is commonly used for 5 gallon pail packaging of bulk foods. It is not often used in retail size food packaging, only one example, a tofu package was found. Therefore it is unlikely that including container shapes will have a significant effect on the residential recycling of type 2 plastic.

The advantage of recycling bulk HDPE items such as lawn furniture is also questionable since a recent review of plastic lawn furniture in a retail store indicated that all the lawn furniture for sale was made from polypropylene, type 5 plastic, and would not be recyclable under the single stream program.

Another difficulty in recycling bulk items is that the item must be marked with the symbol designating the plastic type. Several bulk items were located were the plastic type symbol was on the package of the product but not on the product. Consequently these would not be recyclable.

TYPE 3 - polyvinyl chloride (PVC or vinyl)

Type 3 plastic, polyvinyl chloride, is not recyclable at present and will not be recyclable in the single stream program. A notable concern of PVC is that it is a chlorinated hydrocarbon and can create toxic fumes if burned.

TYPE 4 - low density polyethylene (LDPE)

Low density polyethylene is not presently recyclable. It will be recyclable in the single stream program if it is in the form of a bottle of food container.

However, this is the material used for films and plastic bags, not bottles and tubs. Since sheet materials are not accepted in the single stream program it is very unlikely any additional type 4 plastic will be recycled in the single stream program.

TYPE 5 - polypropylene (PP)

Type 5 plastic is not currently collected in the dual stream program. It will be collected in the single stream program. Polypropylene is typically a harder plastic that tears or breaks more easily than polyethylene.

While there are some bottles that are made from polypropylene, the most common use is small opaque food containers such as yogurt and soft margarine tubs. These are common, and will probably be the greatest source of any additional plastic recycled in the single stream program

TYPE 6 - polystyrene (PS)

Polystyrene is not presently accepted in the recycle program. It will be included in the single stream program with two important requirements. It must be a tub or bottle shaped container and it cannot be expanded polystyrene (styrofoam). Initially there did not seem to be any type 6 containers meeting the recycling criteria. A few were recently found as packaging for fresh fruit.

Since polystyrene is rarely used in a bottle and most polystyrene tub containers are from the foam version of the plastic very little additional polystyrene will be collected in the single stream program.

TYPE 7 – other, or is made of more than one resin used in combination.

The recycle characteristics of type 7 plastic is very similar to that of type 6. It is not presently accepted; it will be accepted in the single stream approach, but the additional condition that it cannot be PLA, or compostable, eliminates virtually all the type 7 plastic that is likely to be found in the home.

The only common residential use of type 7 is the biodegradable food containers used by some stores such as the Ann Arbor Peoples Food Co-op. It is rather ironic that this store adopted this plastic as more environmentally desirable than the more common type 1 but the City will not recycle or compost it.



Reviewing each of the categories of plastics the only additional materials that will be commonly recycled from residents will be type 1 and type 5 tub shaped food containers. The type 1 tubs are the clear, round containers with separate lids that are commonly used for retail sales of olives, stuffed grape leaves and similar items; and the tray or clam shell containers used for berries, dried fruits, nuts and other produce items. The type five plastic tubs are most often used for dairy products such as yogurt, sour cream, etc.

The amount of these items were carefully monitored in one household over the period of several weeks. The additional containers that will be recyclable were weighed using a postage scale.

In order to test if the monitored household was representative a request was made to an email group asking if members of that group would estimate the additional plastic containers that they would be able to recycle in the single stream program.

Fourteen households responded to the request. The average was consistent with the result from the original household more carefully sampled. The results are in the table below.

As discussed before, the items from the carefully monitored household were weighed on a postal scale. The results were that the cylindrical tubs used for olives and similar food weighed about 1 ounce. Large, 32 ounce, yogurt containers weighed about 1.5 ounce. The small individual serving small yogurt containers weigh about 0.5 ounce and the thin produce tubs also weigh about 0.5 ounce.

For this analysis an average weight of 1 ounce was used for all containers The results by are given in the following table.



The city data indicate there are about 28,000 single or dual family collection points in the city. Commercial and large apartments are not part of the same collection system and are not included on the Recyclebank rewards program. Multiplying the additional weight of plastic each household is estimated to recycle each month by the number of households and by 12, gives an estimated additional plastic collection of 220,000lb/yr

Each month the magazine W4aste and Recycle News publishes some data on the value of recycled materials.(4) The data for published since January 2010 indicates an average value for sorted scrap plastic of about $0.20/lb. This means the value of the additional plastic will be about $44,000/yr.


One of the arguments made to justify the cost of the single stream program is the reduced cost of disposing the additional materials in the landfill.

The present cost to dispose of material in the land fill is $25/ton. (5) The estimated additional recycled material is 220,000 lbs/yr or 110tons. With a disposal cost of $25/ton this is only a cost of $2,750/yr.

In a recent article in the Ann Arbor Observer Mr. McMurtrie stated that single stream recycling could double the amount on materials presently sent to the landfill because of cross contamination (5). He estimated the increase to be 1 to 2 percent of the collected materials. This calculates to between 50 and 100 ton/yr. This additional amount going to the landfill offsets much of the landfill savings from the additional plastic recycling.


When the single stream proposal was brought to City Council, the manager or the solid waste division asserted that the additional costs would be paid back to the city in only a few years. The supporting calculations were not made available to Council or the public. However the Mayor asserted that much of the payback would be from reduced landfill costs

Combining the scrap value of the additional plastics and the reduction in land fill costs provides a total return to the city of approximately $45,000/yr. The cost of implementing the single stream program is over $6.7 million. Therefore the simple straight line pay back period is well over 100 years. Since none of the equipment has anywhere near that life expectancy, the single stream program will never payback.

Since the weight of the additional plastics which are likely to be collected is small it is impossible to believe that a reduction in landfill cost can pay for the program. This is supported by the published industry literature. Waste and Recycling News reported that speakers at the 2010 Chicago Conference on Residential Recycling asserted that greatest myth of recycling was that it was “free”.(6) They asserted that people must expect to pay for recycling. One of the reasons cited was the cost of sorting the recycled materials which is greater in the single stream process.


Some people will find it easier to roll a larger capacity cart to the curb less frequently than carrying the hand totes. This may encourage greater recycling and this is an environmental benefit. However the large cart requires automated pickup and this is not compatible with collection of more diverse hazardous items such as such as used motor oil, batteries, florescent lights, and electronic components. Consequently citizens that wish to properly dispose of motor oil, batteries, and florescent lights must now take them to the drop off station and pay a fee.(7)

Curbside collection is one of the most important aspects of citizen participation in recycling programs. The elimination of curbside collection of used motor oil, batteries, florescent lights will result in more of these hazardous materials simply being discarded. This is detrimental to the environment. Electronic items are now a major problem in landfills. (8) It would be environmentally better to provide curbside pickup of these items to encourage recycling than to collect a small quantity of additional inert plastic.

In addition, the cost of the program, $6.7 million, will require reduction in other solid waste programs programs. One of the programs which may be eliminated is the fall leaf collection progam. This will result in more leaves washed into the storm drains and into the Huron River. This will increase phosphorous content in the river and may result in a degradation of the river water quality.


The single stream program includes automated, mechanical collection. This is an advantage to the company, Recycle Ann Arbor which does the curbside recycling collection.

Combining the container and fiber streams makes sorting much more difficult. Much of the additional cost of the program is for additional sorting equipment, consultants to assist in purchasing the equipment and then in the contractor cost to operate the more complex equipment. The transition to single stream recycling is an advantage to FCR the company contracted to sort and process the materials.

Finally, Ann Arbor has hired a consultant to assist in the transition to single stream recycling. The consultant, Resource Recycling Systems Inc. (RRSI) will also benefit from single stream recycling.


The single stream program will allow some additional plastics to be recycled. A careful investigation of these additional plastics indicate that they represent a very small increase in the total mass of recyclable materials.

The calculation of the value of the additional materials that will be recycled shows that the value of the materials, together with the reduction in landfill costs, is far too low to pay for the increased cost of the single stream program.

The position that recycling is not “free” as presented by the proponents of single stream recycling is supported by the industry literature. This does not mean that recycling is “bad”, only that expansion of any program, such as the one Ann Arbor intends to implement comes at a cost. The question that Council should have asked is whether the benefit is worth the $6.7 million cost.

Part of the cost is that the present collection of hazardous materials such as used motor oil, batteries, and florescent lights is being discontinued so much of this material will simply be discarded instead of being recycled. It would be better for the environment to retain the present curb side collection of the present hazardous materials and increase it to include electronic items than to collect a small amount of additional inert plastic materials.

The implementation is very expensive to the taxpayers, but it is a greater benefit to the contractors in the process than to the taxpayers or the environment.

SENSITIVITY of the Analysis to Parameter Variations

whenever a calculation of this nature is done it is desirable to test the sensitivity of the calculation. In particular is there any parameter that might alter the result? Also is there any reason to believe that the sampled or the estimated values used might be high or low?

From the stand point of the calculation, an error in the value of any of the parameters will only cause a proportional error in the final result.

The sample or citizens interviewed was small and this is a potential source of error in the number of containers recycled. Still there are some good indicators of its accuracy. There is a wide range in the responses, from 0 to 40 containers per month, yet the average value, 10.5, is very close to the value, 10, from the household that was carefully monitored.

The average number of residents in the households surveyed was slightly less, but close to the typical number reported for the Ann Arbor average. There might be some error in the estimated number of container that will be recycled in the single stream program, but there isn't any reason to believe the variation from the number used in the calculation will be significant.

Most of the containers weighed, weighed less than one ounce. One of the households reporting the highest anticipated increase in container recycling stated that the majority of the containers they would be recycling were small containers weighing less than one ounce. The calculation used a value of one ounce for all containers. If there is any variation from this value it is probably that the true value is less than one ounce/container.

The value used in the calculation was an average of all reported values of all recycled plastics. But the source of the data only reported values for the most common and highest priced commodities. The actual recycled stream will include other plastics, like type 7, which have very little if any resale value. The number used for the value of the recycled material is probably high unless the sales value of recycled plastic significantly increases from the value in the first quarter of 2010.

The conclusion is the calculation is not particularly sensitive to changes in any of the parameters. It is also more likely that the estimates used for of the weight and resale value of the additional material are more likely to be optimistic than an under estimate Therefore, it is very unlikely that any of the parameters will change sufficiently to modify the conclusions of the report.


1) Society of the Plastics Industry. SPI Resin Identification Code - Guide to Correct Use


3) A2 Recycling Collection Program to Roll Out July-August 2010

4) Commodity Pricing by Region Waste and Recycling News January through May 2010

5) Tipping Point? , Dave Gershman, Ann Arbor Observer, June 2010

6) No free lunch when it comes to recycling , Jim Johnson Waste and Recycling News. April 12, 2010

7) Recycle Ann Arbor's Drop-Off Station Announces New Fee Structure; December 15, 2009.
Jean Brown,, (734) 662-6288, ext. 115

8) Toxic Chemicals Resulting From The Disposal Of Electronic Equipment
U.S. EPA. Potential Environmentally Relevant Chemicals

Sunday, May 30, 2010

Solar Power at the Market
Demonstration Project or Just Bad Investment?

On June 3, 2008 an articles in the Ann Arbor News by A. Nash had the headline: Ann Arbor Farmers Market invests in solar collectors .

The article reported:

The project is one step toward a city goal of having municipal operations running on 30 percent renewable energy by 2010, and about 20 percent of the entire community on renewable energy by 2015.

"It's a good place to show off the technology a little bit," said Mayor John Hieftje. "Part of the project is not just to power city government but to educate our residents about what can be done."

The 156 solar collectors will generate about $1,500 worth of electricity per year to be used by the market offices. The solar power also can supply the electrical needs of the vendors who set up their stalls at the market.

Downtown Development Authority provided $100,000 for the project at the Farmers Market, said David Konkle, the city's energy coordinator.

The solar collectors should be up and running by July.

It is now 2010 and time to evaluate this demonstration project. The following chart shows the utility costs for the Market

The utility cost would include water and sewage costs, but about half of the expense is for electricity. The market office uses electric heat and an electric hot water heater. The data for fiscal years 2006 through 2009 came from the audited financial statements of the city of Ann Arbor. The data for fiscal 2010 are from a hand out provided by the Market Manager at the February meeting of the Market Commission.

If the panels were operating in July 2008, that would have been the beginning of fiscal year 2009. The cost savings for the electricity should be very apparent in 2009. Obviously it is not, utilities in 2009 were greater than in 2008. If you look very closely you might claim that the increase is less than it would have been without the solar panels. But even this is only about $100, and it may just be a statistical fluctuation.

How could our city officials have gotten it so wrong? They simply did not stop to think or they did not want too. They calculated the value of total power the panels could generate, but you cannot store electricity. The Michigan state law is not very receptive to forcing the utility companies like DTE to buy power from small generators.

Mayor Hieftje commented:
The collectors are generating power and it's being used, said Hieftje. However, there's a dispute over whether the city or DTE should pay for a special electric meter. Until that's settled, the city can't push surplus power back onto the electrical grid.(1)

So basically it is use it or lose it. The Market uses most of its electric power in early morning when the vendors need lights for setting up or in winter for heating the market office. These are the two periods when the solar panel either do not work at all,or provide little power.What did the city get for $100,000? A nice sign at the market that proclaims Ann Arbor a Solar City.


Friday, March 19, 2010

Single Stream vs Dual Stream Recycling


Many citizens have criticized the City Council's decision to change from the current dual stream recycling program to a single stream approach.

In the current dual stream approach paper and cardboard are kept separate from the glass, steel, and plastic containers. Under the proposed single stream approach the citizens would be required to put all recyclable materials in a single cart. After collection, they would then be separated by a contractor at the Materials Recovery Facility (MRF).


At the present time thousands of citizens voluntarily do what City Council proposes to pay a contractor to do in the future. Based on the advice of Tom McMurtrie, Ann Arbor’s Environmental Systems Analyst, and that of and the City Administrator, Roger Fraser, the Ann Arbor City Council voted to spend more than $6 million to make this change.

A recent study by the Container Recycling Institute (CRI) supports the citizen position that it is undesirable to mix the two types of recycled material and then attempt to separate them later at a MRF. (1) The Executive Director of CRI, Susan Collins, summarizes their report in the statement: “you can't unscramble an egg”.

This report was brought to the attention of City Council by concerned citizens. The city Administrator commented that a response would be prepared by Tom McMurtrie. We have received a copy of Mr. McMurtrie's response. (2) We have reviewed it and have many comments.

Mr. McMurtrie states:

The report is basically a literature review compilation prepared by a Canadian based consultant whose specialty is industrial producer-responsibility and beverage container recovery systems. The report does not demonstrate expertise, other than literature references, in recycling markets, MRF’s or recycling collection and processing systems.”

In other words the report is a compilation of the literature, documenting the published experiences of others. This is exactly the type of information that is used for government regulations and decisions. When investing millions of dollars, or requiring others to invest millions, it is prudent to search for tested, proven, documented solutions.

Mr McMurtrie asks City Council to ignore the published literature because he asserts that the Container Recycling Institute does not have expertise in recycling. Perhaps Mr. McMurtrie should review Ms. Collins' resume: “Years in waste and recycling, 20. Accomplishments: As a consultant, Collins developed plans to help California municipalities reduce waste by 50%, and then helped implement those programs so the goals were met and in many cases exceeded. In 2008, she worked with the city of San Jose to draft major elements of that city’s zero-waste plan. Having served on the board of the California Resource Recovery Association for nine years, she is now a senior adviser to the organization.” (5)

Mr McMurtrie further states:

The role of curbside recycling, especially single stream curbside, is often presented by bottle bill opponents as a reason to not support container deposit systems. As a result, the CRI chose to fund and present this study as part of their push back against these bottle bill opponents. Unfortunately the report falsely presents single stream recycling as inconsistent with container deposit systems which it is clearly not. “

This is basically a diversionary tactic. Mr. McMurtrie asserts a hidden motive to the report and then attacks the motive he asserts. You might read the CRI report and see whether you believe the material supports his assertion; “the report falsely presents single stream recycling as inconsistent with container deposit”. It is true that single stream recycling is often encouraged as an alternative to bottle return laws by the segment of the industry that opposes return laws. But this is hardly a reason for Ann Arbor to adopt single stream recycling.

Furthermore, the intent of the report is not what is important. What is important is the referenced literature, and the fact that the literature documents problems with single stream recycling. Although Mr McMurtrie agrees that there are problems with single stream recycling, he states:

. . . .our processor (FCR) is proposing a state of the art system and can point to documented successes at their newest single stream plants. “

This is the fundamental argument Mr McMurtrie repeats in the remainder of his report. He asks the Ann Arbor taxpayers to spend more than $6 million to change from our current dual stream recycling program to single stream recycling. The best reason cited is “documentation” by the company that will greatly profit. Not peer reviewed published literature. Just “trust us” from the people that will profit. His presentation to City Council was supported by a power point presentation prepared by a consultant who will receive a $100,000 sole source contract to help in the transition to the single stream program.

In general, both supporters and opponents of single stream recycling agree on the following four items:

Single stream requires a large initial investment. So far Mr McMurtrie has outlined an investment of $6.5 million.
Single stream increases participation. There is some segment of the population that is not currently recycling who will participate if they do not have to separate the recyclables

Single stream recycling may decrease collection costs.

Single stream recycling increases sorting costs.

The CRI study states that the increased volume and decreased collection costs of single stream recycling is often insufficient to pay for the additional sorting costs. The CRI study asserts that this situation occurs if the recovered material from single stream recycling is lower in value. But it may also occur if the value of the recovered material is simply insufficient to pay for the additional cost of separation.

The CRI study also states that single stream is environmentally undesirable if it lowers the reuse of the recycled material. An important point that CRI stresses is that simply sending material to the MRF is not in itself beneficial to the environment. A benefit to the environment only occurs when the material is reused. The less energy and fewer new raw materials required to replace the original, the better it is for the environment.

Therefore in addition to the above parameters it is important to consider the:

Value of Recycled Materials

Environmental Aspects of Single Stream


This should be reason alone to cancel this program. The city is proposing to cut almost every program in the city budget, including police and fire. But at the same time Council will spend more than $6 million to convert from dual to single stream recycling.

At present only about 35% of the material processed at the Ann Arbor MRF is actually collected in Ann Arbor. The remaining 65% come from the rest of Washtenaw, Windsor, Toledo, Livingston Co., Oakland Co., & Wayne Co.( 6) But it is the Ann Arbor taxpayers alone who are asked to pay for the entire expansion of the facility. One of the “benefits” that was presented to Ann Arbor City Council when they were asked to authorize the additional $6+ million expense is that it would lower the cost of recycling in Saline.

Why should Ann Arbor taxpayers be asked to make an investment to lower the cost of recycling in other communities?.


Many states, such as California, have legislation requiring or encouraging municipalities to

divert more of their solid waste from landfills. The waste management industry promotes single stream recycling as the easiest approach to increase tonnage sent to the MRF. The hypothesized increase in participation is the primary reason behind the current enthusiasm for single stream recycling.

However, Ann Arbor does not have a state mandate to increase tonnage to the MRF. We should be careful not to confuse increased pounds of material per household with increased household participation. Ann Arbor already has a 90% household participation in the residential recycling program, and a recovery rate of approximately 50 percent of residential waste, so it is difficult to imagine much increase in residential recycling. (7)

The Ann Arbor single stream program will probably increase tonnage to the MRF, if for no other reason than more types of plastic will be collected. But there isn't any reason that the additional plastics could not be included in the present dual stream program.

Ann Arbor's commercial recycling program is not nearly as successful as the residential program, so a better solution would be to look for ways to improve the less successful commercial recycling program rather than spend millions modifying a successful one.


One of the major claims for single stream recycling is that it reduces collection costs. Logically it takes less time to empty one container than two.

The primary saving comes because automated collection is commonly used with single stream collection. However, automated collection is neither an essential component nor a limitation of either single or dual stream collection.

Other cities, such as Berkeley California are moving to automated collection from divided carts, while maintaining the benefits of dual stream recycling.(8)

Automated collection, either single or dual stream comes at the expense of a very high initial capital investment: $1,428.000 for carts, and $1,156,000 for new trucks, all at a time when the city has very limited resources and is cutting many other programs.


Single stream recycling will increase the annual sorting costs. If you mix materials together it will cost more to have a contractor separate them later. At present the citizens are not separating the materials as much as just not mixing them. Most of the paper stream originates in living room or office areas. The containers originate in the kitchen. This means that single stream recycling will actually require the additional step of combining the materials.

Single stream recycling will require extensive modifications to the MRF to separate the containers from the paper. The modifications and additional equipment is estimated to cost $3,250,000. Again, this will occur at a time when the city claims it must cut many expenses. The two materials that are easiest to sort and recycle are steel and aluminum. But there is little reason to believe much additional aluminum and steel will be collected from the residents of Ann Arbor. The single stream program will collect the additional plastics, type 4 through 7. But these plastics require additional processing to separate them from the type 1 and 2 plastics before they can be recycled.


The real question is not so much the change in value of the recycled material as it is simply the value of the recycled material and its reuse. The value of recycled materials has a history of volatility. The present market value of recyclable scrap material is low.

An important point to consider is that scrap aluminum has the highest resale value of any of the recycled materials. But Michigan has a bottle/can return law. This captures a very large percentage of aluminum beverage cans. Therefore Michigan municipalities have much less aluminum scrap in their recycle stream compared to municipalities in states without container return laws. This means that the total value of the Michigan recycle stream/ton is relatively low.

The proposed dual stream program will increase plastic recycling. But a monograph from the Oakridge National Laboratory states “Given current technology, social, and institutional constraints, the economic viability of recycling plastic waste is questionable. In many areas of the country, recycling can cost as much as $200 per ton as compared to about $40 per ton for landfill or incineration.”(9)

How have other cities responded? New York City suspended its recycling program in 2002 as a cost reduction measure.(10) It was later reinstated by public pressure, but whether or not it is cost effective is still an open question. In May of 2008 it was estimated it cost NYC a total of $267/ton for solid waste collection and disposal and $284/ton for recycled materials.(11) Solid waste disposal is very expensive for NYC because the waste is exported out of the state for disposal. In contrast, Michigan has a very low disposal cost and consequently imports waste from Canada and other states.

An example of the volatility in the value recyclable materials was reported from Oakridge Tennessee. A former Council member of the City of Oak Ridge Tennessee stated in May 2009 that the MRF operator had to pay $20/bale to have material removed from the site. The material was previously sold for $40/bale. (12)

It is important to remember that the primary advantage of single stream recycling to the Ann Arbor citizen is that the single stream program proposes to collect the additional types of plastics, type 4 through 7. Typically in the past these plastics have been exported to China. (13) However, exports of scrap plastic to China have decreased and there is concern that they may not rebound simply because China may now be generating sufficient scrap plastic internally. As mentioned before, these plastics could also be included in the present dual stream program. 

In his report Mr. McMurtrie states that: “The other factor to consider is the contract terms with the markets. FCR has chosen to develop long term contracts with the markets. While that did not give us as much revenue in the peak days of the market, it also allowed us to continue to market our materials when things bottomed out.” This implies that the resale value of the recycled material should not be a concern for Ann Arbor because the contractor will bear any unexpected costs.

The contract with Resource Recovery Systems Inc. is a 20 year contract from 1995 to 2015. What Mr. McMurtrie does not mention is that the contract was amended in 2006. In 2006 the contractor was given an additional $1.3 million because Resource Recovery Systems did not have adequate funds to meet their obligated expenses. (14) If a contractor can simply ask for more money and receive it, the concept of a long term contract is of far greater value to the contractor than to the city or the taxpayers.


The environment is the primary reason for recycling, yet it is the environmental aspects of single stream recycling that are the most troublesome. The CRI study and others have documented two ways in which single stream recycling can be undesirable. The first is in the use of the recycled material.

The CRI study comments that the best environmental use for a bottle is to reuse it. This requires the least amount of energy and does not require any new raw materials. The next best use is to remelt the bottle and use it to make a new bottle. This requires less energy and less raw material than using all new materials. For many years glass manufactures have always used some recycled glass, called cullet, in the manufacturing process. The least environmentally desirable use is to crush the bottle and use the crushed glass as fill. This may divert disposal from the landfill, but new bottles must then be made from new raw materials.

In the case of Ann Arbor, Mr. McMurtrie states “Currently our glass is marketed as a roadbed material at a landfill.” It is doubtful that sales of the crushed glass for this use pay the collection, sorting and transportation cost. Wouldn't it be better to make an effort to improve the environmental use of the presently collected material before spending more than $6 million to collect more?

The second problem with single stream recycling is that the scrap materials from single stream recycling are more likely to be cross contaminated. This is environmentally undesirable because cross contamination results in secondary discard. A purchaser of the recycled scrap from single stream sources may have to re-sort the material and discard a substantial portion as contaminated or unusable. This means it still goes to the land fill -- after extensive processing and transportation! The original recycling source cannot predict this, but may become aware of it later if the purchaser demands a lower price for the material.

How have other cities responded to the environment aspects of single stream recycling?
Berkeley California recently announced it would retain a dual stream collection, but would move toward automated collection. (15)

Roseville Minnesota, “ . . .a vibrant city known for its strong, safe neighborhoods, excellent business climate, quality schools and outstanding parks . . .  just minutes from downtown Minneapolis...” also decided to retain dual stream recycling.(16)

The University of Colorado at Boulder just completed a one year residential hall pilot program in single stream recycling. After evaluation, the university decided to implement an expanded dual stream approach . Dan Baril, Colorado University's Recycling Program Manager said: “It (the single-stream pilot program) made it easier for people to collect the recyclables, but all of the other negatives outweighed just the few benefits.” (17)

There is another undesirable aspect of the proposed Ann arbor single stream recycling. It will make recycling of toxic materials more difficult. Batteries, florescent lights, used engine oil will no longer be collected at the curb.

Citizens can take them to the drop off center. But the Ann Arbor drop off station now charges a $ 3.00 fee for simply entering the facility, and in many cases there is an additional fee for actually leaving the recyclable objects. Ironically one of the reasons the Ann Arbor drop off station gives as the reason for their new entrance fee is the low resale value of recycled materials. (18)

Charging additional fees is an incentive for citizens to simply discard hazardous waste along with the normal solid waste. Unfortunately this must be expected to increase the amount of toxic materials such as lead and mercury in the landfill. At the very time Ann Arbor is indirectly encouraging discarding of electronic devices in the landfill, the Michigan legislature has passed legislation in an attempt to reduce the amount of electronic waste in Michigan landfills. (19)

There are other negative environmental effects. The city has indicated it may stop the leaf collection program because there are insufficient funds in the solid waste program. Leaf collection benefits the quality of the Huron River. The city will spend millions for a program that is environmentally regressive while cutting one that improves the river water quality.


Single stream recycling will require an investment of over $6 million. Only about 1/3 of the material processed by the MRF originates in Ann Arbor. Therefore the citizens of Ann Arbor are being asked to to pay the capital investment that will benefit the region more than our city.

The resale value of recycled scrap is volatile and low at the present time. It is very difficult to accurately predict if the value of the scrap will pay the additional sorting cost of single stream recycling. In the city's proposed program it is the taxpayers who are taking the capital investment risk. Considering the present economic state of the city it is irresponsible to spend  in excess of $6 million for a major new nonessential program.

Independent studies have concluded that single stream recycling may be environmentally regressive because of the emphasis is on the amount of material collected instead of the reuse of materials

Other cities that have been leaders in recycling, such as Berkeley, California, have chosen to improve their existing dual stream program instead of converting to single stream. Roseville Minnesota, a suburb of Minneapolis also recently decided to retain dual stream recycling. The University of Colorado conducted a single stream pilot program before deciding to continue their dual stream program.

The City proposes to spend millions on single stream recycling while cutting exiting environmental programs. This has the potential to divert more toxic wastes to the land fill and reduce the water quality of the Huron River.


Ann Arbor should terminate the proposed transition to single stream recycling.

The existing dual stream recycling program should be maintained and improved.

Curbside collection of motor oil, fluorescent light bulbs, and batteries should be continued or resumed.

The leaf collection program should be continued.

Ann Arbor's other existing environmental programs which recycle toxic wastes or collect and compost organic wastes should be continued.


(1) Understanding economic and environmental impacts of single-stream collection systems; Clarissa Morawski ,Container Recycling Institute, December 2009,

(2) Response to: “Understanding Economic and Environmental Impacts of Single Stream Collection Systems by Container Recycling Institute (December 2009) Tom McMurtrie, January 15, 2010

(3) Single Stream Best Practices Manual and Implementation Guide by Susan Kinsella, Conservatree and Richard Gertman, Environmental Planning Consultants January 2007;

(4) Jaakko Pöyry Consulting (JPC) and Skumatz Economic Research Associates, Inc.
(SERA); Single-stream Recycling – Total Cost Analysis. Prepared for the American
Forest & Paper Association (AF&PA), January 7, 2004.

(5) Women in Waste an Recycling, Novelty gone; now it is about achieving; Waste and Recycling News February 1, 2010

(6) City of Ann Arbor, Meeting Minutes Commercial Recycling Implementation Committee
Thursday, June 15, 2006

(7) City of Ann Arbor Press Release, November 12, 2008, Bryan Weinert, Solid Waste
Program Coordinator

(8) Berkeley, Calif. Adopts split-cart recycling plan, Waste and Recycling News, February 15, 2010

(9) Plastics Recycling: Economic, Social, and Institutional Issues,

(10), New York City Reneges on Recycling,

(11) Analysis of New York City Department of Sanitation Curbside Recycling and Refuse Costs, Prepared For Natural Resources Defense Council, FINAL REPORT
May 2008 Prepared by DSM Environmental Services Inc.

(12), Trash to treasure? Oak Ridge Recycle Program ,Leonard Abbatiello
May 04, 2009

(13), Do cities, businesses, and society benefit from recycling? LeonardAbbatiello, July 15, 2009,

(14) Memorandum from Sue McCormick to Mayor and Council, April 17, 2006.

(15) (8) above

(16) City of Roseville Recycling Pilot Program Summary. R. W. Beck, Inc. and Dan Krivit and Associates, December 2005

(17) When It Comes to Recycling, Is It Better to Be Single? Marisa McNatt, Earth, February 19th, 2010.

(18) A2 Journal, Heritage Newspapers, January 28, 2010

(19) Electronic Waste Takeback Program, Michigan DNRE,,1607,7-135-3585_4130_18096-208087--,00.html