Ann Arbor, Michigan, seeks to replace ReCommunity as its MRF operator

The city government of Ann Arbor, Michigan, has notified Charlotte, North Carolina-based ReCommunity that it is terminating its contract for ReCommunity to operate the materials recovery facility (MRF) that handles Ann Arbor’s collected recyclables.

An online article by the Michigan Live (MLive) media group recounts sources of tension that have emerged between the city and the plant operator, including a costly baler repair and replacement process.

On July 7, 2016, the city reportedly notified ReCommunity several hours before a scheduled city council meeting that it was terminating the recyclables processing contract. The termination was scheduled to take effect Monday, July 11, though ReCommunity has vowed to appeal the decision.

Ann Arbor City Administrator Howard Lazarus is quoted by MLive as saying at the city council meeting, “The city’s decision to terminate this contract was based on ongoing and repeated safety deficiencies in ReCommunity’s operations of the facilities, including fires since the beginning of the year and operating practices that have jeopardized employees’ safety.”

ReCommunity is in the 20th year of a 26-year agreement to process Ann Arbor’s recyclables, according to MLive. The city government began to raise issues in 2015, with those questions reportedly more focused on ReCommunity’s ability to generate sufficient revenue at the Ann Arbor MRF.

More recently, a broken down baler has been the focus of tension between Ann Arbor and Recommunity. According to MLive, at the Thursday, July 7, meeting, city council voted “to approve a $116,507 expense for the city’s share of costs for emergency replacement of the plant’s baler.”

The expense was reportedly made following “several months of ongoing repairs,” after which the baler suffered “a catastrophic failure” June 16, 2016. The baler reportedly failed again June 22 and is now considered beyond repair. A new baler is being budgeted at more than $580,000.

ReCommunity issued a corporate statement on July 13, 2016, to address the situation in Ann Arbor and to express its disappointment with the city’s decision. “ReCommunity has stepped up and invested significant funds to keep the [Ann Arbor] facility operating at optimal levels, thereby saving taxpayers’ money, even when the City refused to pay amounts owed under the operating agreement, and when the City would not agree to purchase a new state-of-the-art baler that they would own at the end of the contract,” the statement reads in part.

“After exhausting all efforts to get the relationship back on track and to resume operations with the newly installed baler that will alleviate many of the issues, we have no choice but to pursue legal remedies,” ReCommunity also says through its statement, adding, ““In over 30 years of our operations, we have never had a contract terminated early.”