Honolulu Mayor Signs Bill Ending Recycling Subsidy
Honolulu Mayor Peter Carlisle on Tuesday signed into law , which ends a city subsidy that benefits recycling companies to the tune of about $2 million per year.
But the mayor’s signature does not end the controversy over the bill, which drew some of the state’s most influential lobbyists and public relations teams to City Hall this year. City Council members are still considering another bill that would undermine the new law by reinstating the subsidy at least in part.
At the center of the debate is Schnitzer Steel, the scrap yard that benefits most from the subsidy. The Portland, Ore.-based company saved $1.9 million last year due to the subsidy, which gives recycling companies an 80 percent discount on the fee they have to pay to dump non-recyclable residue in the city landfill.
After Civil Beat’s initial reporting about the subsidy, Schnitzer Steel Hawaii’s former longtime general manager came forward and said that the company did not need the subsidy.
While Schnitzer executives have said ending the subsidy would hurt their ability to continue recycling efforts in the state, they’ve also refused to disclose financial statements that might prove their need for the subsidy.
Bill 47 drew strong support from members of the public, who said they did not like the idea of tax dollars shoring up a for-profit operation. In a surprise twist, at least one company that benefits form the subsidy lobbied to end it.
“We do get part of that subsidy, about $70,000 a year,” said James Nutter, founder of Island Recycling, in an April City Council meeting. “However, because of the money that is being paid to Schnitzer, the $2 million… for us to be competitive with them, we would like the subsidy eliminated.”
This Friday, the City Council will take up an amended version of , to reinstate part of the subsidy.
The measure would reduce the 80 percent discount to a 50 percent discount until June 30, 2012. After that, it would be reduced to a 35 percent discount the next year, and to 20 percent the year after that.
Some City Council members have said they favor a phased approach to ending the subsidy, consistent with Schnitzer Steel’s request for a gradual end to the benefit. Honolulu Environmental Services Director Tim Steinberger has complained that the measure does not include a “sunset date” or pre-determined end to the subsidy.
It’s unclear how Carlisle would handle Bill 36 if the council passes it and it reaches his desk to be signed into law. The mayor’s spokeswoman could not be reached.
