Wasted revenue? Authority realized in 2005 station didn't track origins

news-alliedstationUntold millions in revenue may have been lost here, at Allied Waste's transfer station at Zion Crossroads, between 1998 and 2005. PHOTO BY JEN FARIELLO

As reported in a recent cover story ["What a Waste: Is the trash Authority going obsolete?"], there's a waste war raging with distrust, lawsuits, and even spying.

The Rivanna Solid Waste Authority is suing Peter Van der Linde, who recently opened a major recycling facility in Zion Crossroads (right next to the RSWA-sponsored facility), to retrieve millions in fees the outspoken hauler allegedly avoided paying by lying about the origins of his trash. However, Authority documents recently obtained by the Hook show that the Authority may have been fleeced by its own partner in trash.

In 2005, seven years after the RSWA inked a deal with a firm called Allied Waste (then BFI and now part of a publicly held company called Republic Services) to send area waste to Allied's waste station in Zion Crossroads, RSWA officials learned that Allied employees were "completely unaware" of their duty to collect a $16 "service contribution fee" for the Authority every time in-district (i.e. Charlottesville and Albemarle) waste crossed company scales.

"Proper charging and accounting of customers has been inaccurately managed," RSWA finance director Lonnie Wood told Allied officials in a November 2005 letter. "[T]here has been and continues to be a breach of contact."

Wood chafed that Allied kept customer accounts directly with area haulers, including Van der Linde, in violation of its RWSA contract, and he said the Authority was "prepared to take legal action."

But Allied wasn't the company the RSWA would eventually sue. RSWA would save its more extreme measures for Van der Linde.

***

In November 2005 letters to area trash haulers, RSWA director Tom Frederick explained that Allied employees had been failing to ascertain waste origins (the only way to determine when to levy the fee), and that Allied was finally setting up a new tracking system.

That meant the end of any special discounts haulers had been receiving– and the start of collecting the $16 fee. Haulers were livid.

"I find it totally outrageous that you send an invoice," wrote Robert Bobbit of Culpeper-based Efficient Roll-Off & Recycling, "that charges a 30 percent higher per ton rate and expect it to be processed without any notification."

But that wasn't the only source of outrage. Under the contract, Allied– which also hauls and rents containers– was exempt from the fee, effectively freeing it from a tax placed on its competition. So Bobbit fired off another letter.

news-water-frederick2"We are not convinced his business [Van der Linde's] is actually moving to other counties," RSWA director Frederick wrote in a March 2006 email to board member Mark Graham. "But I need more evidence before making this an issue. Can you help?" FILE PHOTO BY HAWES SPENCER

Wood apologized for the time Bobbit was unaware of the service fee and issued his company a $5,208.29 credit. Such gestures would not be lavished upon Van der Linde who made no secret of his antipathy for deal.

"I was never against the RSWA fee so long as there was a level playing field," explains Van der Linde. "My only objection concerned the Allied exemption from the fee and the monopolistic advantage granted to Allied by the RSWA."

In October 2005, Van der Linde asked the RSWA's Frederick for written notice of the service fee to show his customers, so they'd have "no doubt about the legitimacy of this additional expense" and "slow the stampede" of his customers to haulers "willing to lie about where their trash originated."

Van der Linde even gave RSWA officials a tape recording of his secretary posing as a potential Allied customer.

Allied employee: "We're hauling it to our transfer station, so we set our own rate. And the [other haulers] pay more."

Van der Linde secretary: "Is there any difference for the rate per ton for waste coming from Albemarle?"

Allied employee: "Not through us. [The employee quotes a $43 per ton rate.] Everybody else is paying $62 a ton, so that's what they'll charge you."

Finally, after receiving no response, Van der Linde told Frederick in December that he really had no choice but to go to court. "I cannot exist much longer," he says he explained, "unless I press this thing legally."

In January 2006, he sued the Authority.

"I was definitely scared," says Van der Linde. "Haulers were trapped like rats."

Meanwhile, a waste station in Greene had begun accepting. "So we tried to divert some waste there, but it's a long way away," he says. "And with the Louisa County landfill closed to out-of-district waste, everyone was forced to use the Allied station."

cover-grahamIndeed, Graham could help Frederick. As the planning director for Albemarle County, Graham offered up County building inspectors to take on a new task. They would note whenever they spotted one of Van der Linde's distinctive orange containers. FILE PHOTO BY JEN FARIELLO

Not wanting to lose customers, Van der Linde says he decided to "eat" the $16 instead of raising his rates, figuring this would be a "slower way to bleed."

At this point, the trash hauler figured he was finished. "I couldn't go on eating that $16 much longer," he says.

Then something peculiar began happening. Van der Linde claims that Allied suddenly stopped asking his drivers where their waste was coming from.

"It saved me," he says, "because when they didn't ask, I was charged the old Allied rate."

So why would Allied stop asking? At first, Van der Linde says, he didn't know why, but when Allied raised its own rates a short time later, adding various fees for out-of-district trash, he began to harbor suspicions.

Meanwhile, relying on Allied's numbers, RSWA officials began to notice a drop in Van der Linde's in-district tonnages at the station and suspected foul play– on Van der Linde's part.

"We are not convinced his business is actually moving to other counties," RSWA director Frederick wrote in a March 2006 email to board member Mark Graham. "But I need more evidence before making this an issue. Can you help?"

Indeed Graham could.

As the planning director for Albemarle County, Graham offered up County building inspectors to take on a new task. They would note whenever they spotted one of Van der Linde's distinctive orange containers.

Two months later, Frederick emailed finance director Wood for an update: "Are you getting any data from the County that can be used to find any 'smoking guns'?"

"Unfortunately," Wood replied, "no."

Wood did, however, note that the tonnages Van der Linde was reporting on his Rivanna account were "more than questionable," from between 539 and 324 tons in November and December 2005, to just 161 and 64 tons in January and February 2006.

In March 2007, Frederick noted, Van der Linde "is still bringing in a significant amount of waste into the [Allied] facility, and they are declaring it from Fluvanna or Louisa. We have not received a single ton of waste on that account for February. We have not received any since August."

Also in March, Wood learned that Van der Linde delivered 1.04 tons of in-district waste to the Allied station and quipped in an email to Frederick, "One must have slipped through their net... or it was a new driver... ha ha."

In November 2007, Frederick recruited his recycling manager as a private investigator as he asked Bruce Edmonds to photograph the location of dozens of Van der Linde trash containers to prove that waste in the RSWA district was not getting declared at the Allied transfer station.

While the RSWA embraced the theory that Van der Linde, and possibly other haulers, were lying about waste origins, there may have existed a strong disincentive for Allied to collect the service fee.

After Allied's rate increase, Van der Linde points out, Allied actually made far more money on waste received from outside the Rivanna district. With the additional "environmental" fees that Allied began charging, fees inapplicable to district haulers under the the 1998 agreement, it now costs haulers $80 per ton to dump out-of-district loads at the Allied station. And all of that goes to Allied. In-district trash brings just $62, and Allied gets to keep just $44 of that.

"At that time I started to wish they would ask," says Van der Linde, "because now it was costing me more to bring out-of-district trash."

But Van der Linde says he decided not to complain this time, as he feared getting in the middle of a RSWA fee collection system that appeared to have gone awry.

Van der Linde would eventually lose his lawsuit against the RSWA, as the judge ruled in November 2007 that the grievance should have been handled through the political process, not the court system.

In January 2008, the RSWA slapped Van der Linde with a $3.5 million lawsuit, based on its suspicions that Van der Linde's drivers were lying about the origins of their loads.

Now Van der Linde says he was really confused.

"It would have actually cost me $18 more per ton to lie and say my loads came from outside the Rivanna district," says Van der Linde. "Why would I ask my drivers to lie? And how on earth could I convince my 53 employees to go along with it?"

As for the drop in his Rivanna district tonnages, which prompted the RSWA's lawsuit, Van der Linde says that coincided with a construction business slowdown in 2006, as well as with his decision to divert some waste, but mainly, he claims, it was caused by Allied not asking his drivers.

Last July, believing this would be central to his defense, Van der Linde hired a private investigator to set up audio/video surveillance equipment on his land adjoining the Allied tipping station. From August to September, working every other day, his investigators recorded hundreds of transactions at the Allied tipping station. Only occasionally, and randomly, the tapes allegedly show, were drivers asked about the origin of their loads.

Van der Linde hand-delivered this evidence to RSWA officials, hoping they would drop the lawsuit, but officials never responded.

Allied transfer station manager David Outing returned the Hook's call, but said that any questions would have to be directed to the company's corporate office. Outing promised that someone from Allied's offices would be in touch. Allied officials, however, had not yet contacted the Hook by the time of this updated post.  

Flash forward to 2009. Van der Linde has opened a recycling center next door to Allied and charges $18 per ton less– just $44 a ton. And builders and haulers have been flocking.

"I used to send the RSWA $10,000 to $15,000 a month," says Ken Bahr, owner of Cavalier Container. "Now I send them barely anything at all."

Most of the area's major construction debris haulers confirm that they've opted to skip Allied and use Van der Linde. But not all of them.

Gaffney Homes, owned by RSWA chair Mike Gaffney, closed its account with Van der Linde in late November 2005, shortly after the RSWA fee enforcement system went into effect. Prior to that, when Wood was seeking Gaffney's help in tracking the origins of Van der Linde's waste, Gaffney told Wood that Van der Linde took about 50 percent of his construction waste.

So where does Gaffney's debris go? He declined to answer that question in an email, as well as questions about the possible lost revenue caused by Allied's failed tracking system, and has not responded to phone calls.

The lawsuit waged on his board's behalf concedes that pressing the claim will cost about $350,000. In a March 2009 letter to Wood, Authority director Frederick– who did not respond to questions about Allied's tracking of area waste– describes how lawyer Kurt Krueger is "building a sufficient case based on circumstantial evidence to allow us to subpoena Van der Linde and his business records."

Indeed, Van der Linde says he's in the middle of supplying those business records right now as part of the $3.5 million lawsuit, 40,000 pages in all, which he thinks should be about 13-feet tall.

"I'm kind of forced to do this ridiculous thing, because if I don't, when we go to court, a judge and jury might think I'm trying to hide something," says Van der Linde, who thinks the lawsuit will cost him about $200,000. "But the RSWA doesn't understand. I'm not a Boy Scout. I'm an Eagle Scout."

Updated: 4/21/09 3:55pm

This story is a part of the Waste War: the fight over trash and recycling special.

34 comments

A perfect example of Government sticking its nose in to private business.

Why should the government get a cut on trash anyway?

"Efficient Roll-Off" containers are now seen on Gaffney jobsites. Efficient Roll-Off records should be subpeonad as well as Gaffney's, then reconciled with the Louisa County Landfill's records. Louisa is $45 per ton and is operated by Community Trash Services, which is connected to Updike/ Efficient.

Just to make sure no Gaffney debris ended up at Louisa. Certainly it ended up at Greene. While perfectly legal, tipping at Greene avoids the RSWA fee.

Fluvanna is trying to stop just such an authority from forming. Can we disband our water and sewer authority with a referendum ?

If we can let's start collecting those signatures today !

Glad to have the Hook as our community watchdog but now it's up to us to do something about this. I'm on board with a vote to oust these people just tell me how.

Unfortunately, the Rivanna Water and Sewer Authority and the Rivanna Solid Waste Authority are not directly answerable to the public - their members are not elected. Does anyone really want to do business with either Authority. That Gaffney character seems to be a slippery as Frederick.

Kurt Krueger, is this the guy that got the special deal from the City for putting the YMCA in McIntire Park or is he somebody else?

To Cville eye: yes it is the same Kurt Krueger who created the country club (YMCA) for rich folks from northern Albemarle County.

When I read the last trash article and then the one above I was flabergased. This is too strange. You couldn't make this stuff up. The RSWA is totally out of control and needs to be shut down. Put control directly back in the hands of our elected officals. It is hard to believe but after following the water controversy it seems consistent with other things I have learned. Does it seem strange to everybody else that Van der Linde is completely open and talking to the press while Allied, Gaffney, Fredreick, and the RSWA won't respond?

Thanks, Downing Smith. No, it's not strange when you've got something to hide, like, maybe, a conspiracy to drive a competitor out of business. You have to get together to get you stories straight. I don't find it strange that the rest of the board members are omitted from the article. Maybe they are expected to just rubber stamp any decisions that the "real" bosses make. I do find it interesting that RWSA was able to get a private company to charge its private clients a $16/ton surcharge and give it to an agency that didn't do five minutes worth of work to earn it. Maybe that was necessary in order for Allied to get the contract from RSWA. Well, by Allied's apparently changing the rules, the RSWA's position seems to be shot full of holes and is probably throwing $350,000 down the drain. I wonder what will be Mayor Norris' take on this suit when he assumes his seat on the board.
I, for one, won't be giving the YMCA five cents nor will I buy any home built by Gaffney. I won't hire him to do any remodeling for me either. It's a matter of trust.

I can only speculate that folks aren't talking because of the lawsuit. That's standard operating procedure.

Thanks to Hawes for covering this story. I was shocked by the irst one, and equally so by the second. Even though Frederick's views are the polar opposite of mine regarding the Water Plan, I've always thought of him as a good guy. I'm sorry to say that's changed now.

Hope the folks in Fluvanna are watching this and taking note so they can see what sort of bullet they may be dodging. The last I heard was that a judge has sided with them and will order a referendum.

Confidence in any action by this board will be questioned. In order to restore trust the elected officials need to appoint a new board who can then hire a new director.

Too much water over this dam

I think the rest of the board members were omitted from the articles because the memos (emails) were not circulating among them.

If you would like to address the board about this issue in person
The RSWA ( Rivanna Solid Waste Authority) meeting will start at approximately 2:20 p.m. in the Conference Room, Administration Building, 695 Moores Creek Lane.
this Monday April 27th

The RWSA (Rivanna Water and Sewer Authority) meeting starts at 2pm in the same location

There is a public comment period at the beginning of both meetings

directions to the Moores Creek facility

From Emmett Street (Route 29 South) - take 250 East to East High Street and turn right on High. Follow High Street to Meade Avenue and bear left on Meade Avenue. Follow Meade to Market Street and turn left on Market. Proceed through four-way stop, then turn right onto Franklin Street. Go under the train tracks to four-way stop. Proceed straight and Rivanna will be the first driveway on the left across from the Carlton Trailer Court.

What we see in both the Rivanna water plan and their solid waste operation is an agency attempting to enlarge itself at the expense of the taxpayers without legitimate justification for doing so. In the case of the water concept only one consultant came up with the cost estimates for the plan which are now known to be wildly inaccurate. In the case of the solid waste authority, Rivanna is attempting to eliminate competition by suing its competitor. In both cases we are witnessing an agency out of control, not fiscally responsible to the citizens and wasting millions of dollars of our money to hoard power for itself.

Today's Daily Progress says that with 10% of the voters the court can order a referendum before a water authority can be created. How many voters does it take to dissolve our Authority now that it has been shown to be in shambles?

What a mess and Fluvanna County is caught in the middle of it! This is one of the many reasons why we were opposed to either one these facilities being approved and built. Apparently, these are the kinds of businesses that Fluvanna County wants for our end of the County. The "tipping fees" should be going to the Fluvanna County community because all of this trash, recycling, what ever you want to call it, has a negative impact on infrastructure and those that live in Fluvanna County, Route 250 West of Zions Crossroads. The Fluvanna County community should be paid for putting up with all of this nonsense!

Good luck Fluvanna hope you can prevent your water and sewer services from being run by an authority with no accountability to the citizens

This is textbook facism. Textbook in that the goverment wishes to control (but not own) production.

My family came to the United States (New York) in the 1920's to escape Mussolini fascism. They were hard working people in the garbage business. We had a garbage business in the family. There was no need for this "authority" nonsense since the carting companies had their own commission and things went smoothly.

We started a garbage business here, and its almost like the fascism we fled is repeating itself.

I believe this is clear evidence that the RWSA director Mr. Frederick should be fired for going on a witch hunt against a private citizen and the board should resign. As the judge ruled previously the legal case should be dropped immediately and and our elected officials should jump into action and fire Frederick and remove this board !

"Van der Linde would eventually lose his lawsuit against the RSWA, as the judge ruled in November 2007 that the grievance should have been handled through the political process, not the court system."

Mayday! Mayday! We're being sprayed with chemicals from jets! The chemtrails contain 128 bit nanochips that cross the blood brain barrier after you inhale them and then connect to the neurons in your brain and transmit them to via satellite to a 200 acre supercomputer in Utah using a 38 digit code of 0's and 1's!We're being turned into nanobots! Mayday! MaydaY!

Dude, have you been tested for subliminal distraction? It's a free test and only takes a minute of your time. Results are confidential and available within 24 hours. All office cubicle dealers in the area offer the testing service and will be glad to help you. Call today.

That's the nanochip in your brain talkin, Damian! You're a robot and you don't even realize it!

I'm coming for you, Johnny. Do not be frightened. This will not hurt.

You must be proactive. I was. I asked the Anunnaki from the planet Draco to help and they placed a protective sphere behind my left eye. The chips will bounce off of me and stick to you if you don't get help soon. Make a red circle and meditate inside. They will come to you on a light beam. While you wait the best protection against chips is a plastic bag placed over your head and sealed around your neck with duct tape. It must be red tape.

John Giuliano, I do detect humor in your statement. It may sound far fetched at this moment in history.
Anyone who questions the possibility of such an event should read "Wired for War" by JP singer. It is a book that will open your eyes to the current state of and future of robotics.

And just for fun, go to youtube and search using "the big dog" or DARPA

There's nothing funny about my statement. You can read the elite's own white papers stating they want to put a chip in everyone by the year 2010, and you can go online and examine the photos of nanofibers that have been found in the bodies of those with Morgellan's disease, and you can read all about nanochips that are small enough to be inhaled and abosorbed into the brain if you want. Or you can mock me like most people who have been trained to do so when confronted with startling facts that would cause a enormous life-disrupting shift in their worldview do, but rest assured this isn't a joke.

I was hoping for a link to something that would explain how these magical particles are able to transmit the information they gather all the way to those distant satellites. I'd drop my cell phone plan in a heartbeat if I could show me how to make that work.

If you're not in cell tower range, you can probably enjoy the privelege of keeping your thoughts to yourself, Guglielmo. It's not magic, it's space age technology. If we can put a man on the moon, we can put a chip in a man.

The question wasn't whether a chip could be put in a man, it was how it would be able to transmit so far. I can't get cell phone reception in North Garden sometimes. That cell phone regularly gets plugged in to charge a relatively huge battery, by comparison to a microchip that is.

Seems like anyone who exposed a real multi-billion dollar secret project would have been taken out by now. Funny they let you keep posting all their secrets under your real name. Why don't they at least lock you up?

Dude, the microchip is powered by the electrical impluses that make up your brain wave activity. It doesn't need a battery. I didn't design the chip, I didn't design the satellite, so if you want to know how they work, I suggest you ask the person/persons who did. Of course, you won't because you're more interested in finding ways to dismiss this information than in acquiring more of it. As for locking me up, they tried that, and they tried setting me up, torturing me, and nearly killing me too. What more do they have to do? Kill me?

we didnt put a man on the moon

And Buzz Aldrin didn't say that the main driver of climate change is the sun's electromagnetic radiation, which interferes with the cosmic ions from outer space on which water droplets condense, leading to low level cloud cover which reflects sunlight and cools the earth, or in the absence of which (during high radiational output phases of the sun's mult-year and/or multi-century cycles) leads to reduced low-level cloud cover, increased sunshine reaching the earth's surface, and an overall feeling of wellbeing amongst people who are glad their crops aren't being killed by frost! By the way, Alex Jones is still alive and well, in spite of everything!

You left out anti-gravity machines, perpetual motion, and subliminal distraction. Other than that, you have pseudoscience pretty well covered.

Well, at least my name's not Guglielmo!

GM-