Editorial: Recology should be hanging its head in shame—not undermining reform

S.F. waste management company attempts to fool ratepayers again

By The Examiner Editorial Board

Recology, the waste management company at the center of San Francisco’s ongoing public corruption scandal, should be hanging its head in shame and humbly rebuilding public trust in its bribery-tainted brand. Instead, the company — in a shocking example of hubris — is trying to undermine efforts to reform The City’s trash contracting process.

“Ensnared in a bribery scandal over raising the rates San Franciscans pay for garbage, trash-hauling giant Recology is now trying to rein in The City’s attempts to reform the very process its executives sought to abuse,” wrote Michael Barba of the S.F. Standard last week. “After being sent a draft of the ballot measure that Supervisor Aaron Peskin and Mayor London Breed are considering putting forward, Recology essentially rewrote the proposal and submitted its own watered-down version to elections officials to begin gathering signatures.”

Recology’s effort to thwart real reform by undermining city officials’ efforts to provide more oversight drew harsh criticism from Peskin.

“In 20 years of being in elected life, I have never seen this amount of hubris,” said Peskin in an interview with The Examiner. “It is mind boggling.”

He said the reform measure Recology wants to put on the ballot basically amounts to a case of “trust us, don’t trust the experts.”

Peskin has spearheaded efforts to reform The City’s outdated contracting process for residential waste disposal. Recology enjoys a powerful monopoly on residential waste management here thanks to a 1932 law that Peskin and Breed now seek to revise in the wake of bombshell revelations of overcharging and bribery by the company.

In the past year, the company admitted to stealing $95 million from The City’s residents by overcharging them through improper rate hikes. In addition, federal authorities charged two former Recology executives, Paul Giusti and John Porter, with funneling over a $1 million into nonprofit accounts controlled by disgraced former Department of Public Works Director Mohammed Nuru.

Giusti has entered a guilty plea to bribery and fraud charges and is cooperating with investigators. In September, three Recology subsidiaries admitted to conspiring to bribe Nuru and agreed to pay a $36 million fine as part of a deferred prosecution agreement with the U.S. Attorney’s Office. That includes a $7 million penalty Recology previously agreed to pay San Francisco as part of its earlier settlement with the City Attorney’s Office.

Recology’s multiplying scandals have stoked public outrage and pushed city leaders to reform of the 90-year-old law that gives Recology its vast powers over waste management in San Francisco. Now, in a stunning act of public arrogance and cynicism, Recology is trying to weaken reform efforts by running its own ballot measure.

Recology spokesperson Robert Reed told Barba the company supports “stronger controls, greater transparency and stricter accountability,” but wants to “make necessary reforms to the rate process while at the same time ensuring that the voters, not politicians, have the final authority over how the charges we pay for recycling, composting and garbage collection are set.”

But where was Recology’s vaunted sense of civic virtue when its executives were busy overcharging San Francisco ratepayers and bribing their public officials? Recology is trying to shield itself from real accountability, period. Any claims to the contrary are simply another insult to Recology’s beleaguered customers.

“I think Recology has managed to do what no one else has managed to do: Unite the Board of Supervisors and the mayor,” said Peskin. “If they want to continue going down this path, this is not going to be a couple of members of the Board of Supervisors and Quentin Kopp. This is going be the Mayor’s Office, the controller of San Francisco and the city attorney of San Francisco. I think the voters of this smart city are not going to be fooled by Recology.”

Peskin suggested there may be more trouble ahead for the embattled trash company. In November, the controller’s office sent Recology a letter asking detailed questions about the company’s recent annual rate report.

“We have ongoing questions and concerns regarding Recology’s past rate setting and charging practices,” said San Francisco City Controller Ben Rosenfield in a statement to The Examiner. “We’ve shared a host of questions with Recology and asked for further financial and other information to investigate further.”

Recology should drop its slimy plan to thwart The City’s reform effort and focus on repairing, rather than further damaging, its corporate reputation.

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