Recycling Theft

Recycling scavengerBy Anne Noyes

One night last fall Carmen Cognetta was driving in search of a parking spot in the East 90s but kept getting held up by slow-moving trucks in front of him. The trucks were lurching down side streets, stopping every few yards to allow their passengers to jump out and pick up huge bundles of paper and cardboard that had been placed curbside for recycling.

Cognetta, who serves as counsel to the City Council’s Sanitation and Solid Waste Management Committee, knew the trucks weren’t supposed to be taking the paper. By law, the City of New York Department of Sanitation owns all recyclables that have been placed on the curb for pickup.

Collecting optimum amounts of recyclable paper may seem like an unusual priority for the city. But in fact, the city earns about four million dollars each year by selling waste paper to local recyclers, and that money is needed to cover the cost of collecting curbside recycling.

“For every ton of paper that we lose, we lose the revenue from it, and that subtracts from the efficiency of our operation. The trucks become more and more empty,” Robert Lange, director of the Department of Sanitation’s Bureau of Waste Prevention, Reuse, and Recycling, said. “The paper helps to offset the cost of operations. Without large enough amounts, it costs us more for every truckload.”

After witnessing the theft, Cognetta called a colleague in sanitation and asked if the department was aware of the problem, but his inquiry was largely ignored. “There wasn’t much complaining because [the theft] was done mostly at night,” Cognetta said. “Doormen assumed the recycling had been picked up by D.S.N.Y. when it was gone the next morning.”

A few Upper East Side residents—mostly people who walked their dogs late at night—had called sanitation to complain that men in unmarked vans with out-of-state plates were methodically stripping neighborhood curbs of recyclable paper. The reports indicated that the thieves were targeting large apartment buildings, which are especially plentiful on the Upper East Side and which generate huge amounts of trash and recyclables.
But sanitation didn’t take the complaints seriously. It seemed like just another New York City oddity: guys in 1970s-era vans—the boxy kind, without windows—who had a thing for recyclable paper.

img_0480.jpgThen in early 2007, sanitation crews began reporting that recyclable paper was disappearing completely from some stops along their routes. That got the attention of Todd Kuznitz, the Department of Sanitation’s assistant chief of enforcement.

Kuznitz went over the paper recycling numbers and realized that between 2006 and 2007, there had been a huge drop in the amount of paper taken in by sanitation crews. He estimated that waste paper intake in Manhattan had declined by almost 3,000 tons in March alone—from 8,750 tons in March 2006 to 5,900 tons in March 2007—a 33 percent drop for the borough. In the last year, Kuznitz’s calculations showed, approximately 15,000 tons of recyclable paper—worth about $150,000, according to the city’s current contracts with recyclers—had been stolen from New York City curbsides.

Kuznitz put 20 sanitation officers on an undercover detail, and the officers spent nights driving up and down streets in Manhattan neighborhoods where recycling was scheduled to be picked up the next day. “We were catching one to two [trucks] a night,” Kuznitz said, but “at that point, it was only a $100 summons. They would take that summons and go around the corner and keep going—it was the cost of doing business.”

By June 2007, officers had handed out 128 summonses, but the theft continued. Sanitation officials suspected the $100 fines weren’t high enough to deter thieves.
Alerted to the problem, City Councilmember Micheal E. McMahon, chairman of the Council’s Sanitation and Solid Waste Management Committee, went to work drafting legislation to increase the fines. At the end of September, the Council unanimously passed McMahon’s bill, which established $2,000 fines for first offenders and gave officers the right to impound vehicles involved in the theft. The bill also instituted $5,000 fines for a second offense within a year, as well as fines for recycling companies that accept paper from non-city trucks. On October 9, 2007, Mayor Michael R. Bloomberg signed the bill into law.

Now, Kuznitz says, waste paper collections are back up to pre-theft levels. He attributes the increases to the department’s spring and summer crackdowns and the newly increased fines. “The numbers are up and there’s no evidence of theft,” he said. “We’re hoping the law is a deterrent, not that we have to go out there and catch 30, 40, 50 people.”
Theft is a problem not just for the city, but also for private recycling companies. The city’s contracts with six local recyclers set minimum requirements for the amount of paper that the city must deliver each year.

The 30-year contract the city signed in 1997 with Visy Paper NY, a Staten Island paper mill, guarantees Visy roughly 50 percent of the city’s recyclable paper—or about 200,000 tons of paper annually. Five other recycling companies in Brooklyn, Queens, and the Bronx split the remaining 50 percent of the city’s recyclable paper. All of these companies need a minimum amount of waste paper to keep their recycling operations running profitably.

So when the amount of waste paper delivered by the city began to drop over the last year, Judy Goodstein, Visy Paper NY’s procurement manager, was concerned. “If my normal corridor is Connecticut to Pennsylvania, [and incoming paper from that corridor decreases,] then I need to [expand the corridor] and pull [waste] from Massachusetts to Baltimore—so it causes a lot [of extra cost] in the way of extra trucks traveling in from distant locations every day,” she said.

Empty dumpsterBooming demand for paper in Asia has pushed waste paper prices to near-record highs over the last two years. That makes stealing waste paper and reselling it unusually lucrative, Goodstein said. “The issue is the export market—you have these inflated prices, and paper waste now becomes gold,” she explained. “Hopefully these new laws will boost the paper levels, but if people are going to steal, there’s nothing we can do to stop them.”

Now, more than ever before, manufacturers in China, India, and South Korea are shipping their products to Europe and North America. But in order to do that, they need boxes, packing materials, and office paper. Substituting waste paper for virgin sources is the only way to meet the newly elevated demand.

Asian paper mills buy scrap paper from vendors throughout the world, but North American waste paper is especially sought after, according to Tom Hattle of Kansas-based RecycleNet Corporation, an online scrap recyclables exchange. “The fiber in the North American paper is better fiber than a lot of the Asian fiber—it’s a longer, better, stronger fiber,” he said. “Their cardboard doesn’t have the strength that the cardboard does here because rather than trees, they use a lot of straw and other types of vegetation materials.”

In recent years prices for most grades of waste paper traded on ReycleNet’s online exchange have risen dramatically. The most recent figures cited in “Paper Recycling Online,” an industry trade publication, reveal that the average price of waste paper increased 32 percent in the last year alone—from $151.41 per ton in 2006 to $200.32 per ton in 2007.

Waste paper prices haven’t been this high since 1994 and 1995, when huge demand for paper—primarily from mills in the United States and Europe—triggered the last paper boom. Back then, there were also reports of waste paper theft. “It wasn’t widespread, but there certainly were occasions,” said Bill Moore, a leading consultant to the paper recycling industry. “We’re at that level [of waste paper prices] again where these kinds of theft occur.”

Some paper recyclers only to do business with collectors they know. Others only accept waste paper that comes with signed written statements that identify the paper’s source. “We’ve had people come to us with vans filled with cardboard,” said the president of one private paper recycling company in New York City, who asked that her name not be used. “We always say ‘no’ because we like to know where our materials are coming from. It’s easier to process it when we know where it’s coming from.” But, she added, other recyclers are far less scrupulous. “They take in from any mom and pop operation running around with a van, and they won’t ask questions,” she said.

In New York City this summer, sanitation officers found that most of the trucks hauling stolen waste paper were manned by people who had come to New York from other states. “Most of them had foreign, unpronounceable last names,” said the Department of Sanitation’s Kuznitz. “They were coming from Texas, North Carolina, Georgia—all over the country. The vehicles were all registered out of state.”

When questioned, the men told sanitation officers that they intended to sell their stolen paper to Chambers Paper Fibers, a recycling plant just over the Manhattan Bridge in DUMBO, Brooklyn.

Chambers was already well-known to the city. Back in the early 1990s, the company had allowed an undercover detective from the New York Police Department to pose as a manager there. That detective was able to gather evidence—hundreds of hours of recorded conversations—that proved the city’s illicit garbage-carting industry was controlled by a cartel of mafia-connected associations and private companies.
In 1997, that proof helped to convict six garbage industry executives of crimes connected with their involvement in the cartel, and Chambers was hailed as a hero in the movement to reform the industry.

But now the city was investigating its old ally. Kuznitz, the director of sanitation enforcement, sent a sanitation officer to monitor any action at Chambers. The officer observed vans that looked like the ones stopped on Upper East Side streets coming and going from the plant.

What’s more, the officer reported seeing a Chambers employee giving what looked like route maps to some of the drivers of those vans. “In one or two of the vans, they in fact had a list of stops where they were supposed to be going,” Kuznitz said. “Our best guess is they were all tied to Chambers—they could probably get five to six truck loads a night and then just go over the bridge to Brooklyn and drop it off.”

So far, Chambers is the only recycler accused of receiving the stolen waste paper. Kuznitz suspects the company coordinated the van pick-ups in order to boost the supply of paper for its plant.

Although frequent requests for comment were made throughout the last three weeks, each time, a Chambers employee who answered the phone said no manager was available to respond to the Department of Sanitation’s claims.

Bina Dabbah, a resident of East 63rd St., who serves as treasurer of the East 63rd Street Block Association, has seen the men with the vans in action in her neighborhood. “You barely notice them—they come and go so quickly,” she said. “They know when the buildings put the garbage out. I’m sure it goes on all the time”

But, Dabbah said, the fact that recyclable paper is being stolen doesn’t seem to be a huge concern for people living in the neighborhood. “I haven’t heard much talk about it,” she noted. “It’s an issue for the city, and I guess it becomes an issue for residents if they grab the stuff and they make a mess.”

Community Board Eight represents the areas of the Upper East Side hardest hit by the recycling theft, but David Kleckner, co-chair of the board’s Environment and Sanitation Committee, said his committee hasn’t received any complaints about stolen recyclable paper. “People care about things that they feel will impact them personally,” he said. “They care about a banner that’s going to be hung on their street, but the city’s recycling program is a little vague.”

Kleckner said his committee briefly discussed recyclables theft in a recent meeting—but only because City Councilmember Jessica Lappin had raised the issue at the full board’s October 17 meeting. “I think it’s something we should talk about, but it’s not a top priority as of this moment,” he said.

One response to “Recycling Theft

  1. Pingback: Recycling theft « The NYC Garbage Project

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