=======================Electronic Edition========================
RACHEL’S HAZARDOUS WASTE NEWS #99
—October 17, 1988—
News and resources for environmental justice.
——
Environmental Research Foundation
P.O. Box 5036, Annapolis, MD 21403
Fax (410) 263-8944; Internet: erf@igc.apc.org
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WASTE MANAGEMENT ACCUSED OF GANGSTER-STYLE DEATH THREATS AGAINST NEW ORLEANS OFFICIALS.
Waste Management, Inc. (WMI), the nation’s largest and least law
abiding waste hauler, reportedly raised the stakes last week for
citizens who oppose their operations. According to the
TIMES-PICAYUNE, the largest newspaper in New Orleans, Louisiana,
representatives of Waste Management told two high-level New
Orleans city employees that they would “wear cement boots” and
would “meet their maker” if they continued to investigate alleged
overcharging of the city by the waste hauler.
According to the TIMES-PICAYUNE Oct. 7, 1988, pg. B1, the New
Orleans Superintendent of the Department of Sanitation, Cecil
McFarland, and his supervisor, Sanitation Director Pat Koloski,
reported the gangster-style death threats to the City Council at
a public meeting Oct. 6. HWN interviewed City Councilperson Peggy
Wilson, who confirmed that she had heard Mr. McFarland make the
charges: “I said to him, ‘Are you saying Waste Management
threatened your life?’ and Mr. McFarland said, ‘Yes, that’s what
I’m saying.’” According to TIMES-PICAYUNE writer Frank Donze, who
covered the City Council meeting Oct. 6, “Koloski confirmed that
the threats were made but neither he nor McFarland would discuss
who made them.” HWN interviewed Cecil McFarland, a man in his mid
’30s, at his city office in New Orleans Oct. 7, and asked him who
in Waste Management had made the death threats. Mr. McFarland
told us he had just finished testifying before a federal grand
jury an hour before we met with him, and he said he was under
orders not to speak about the matter. Mr. McFarland appeared
nervous and shaken during our interview. He politely but firmly
declined to answer any questions related to the death threats. He
did confirm that the city had been dumping its garbage at a
landfill owned by Waste Management since 1976.
According to the TIMES-PICAYUNE, Mr. Koloski, and Mr. McFarland
had been holding a series of meetings with representatives of
Waste Management to discuss alleged overcharging of the city by
the waste hauler. A report issued by the office of New Orleans
Mayor Sidney Barthelemy earlier this year alleged that Waste
Management had overcharged the city in at least the following
ways:
charging the city for disposal or garbage from other parishes;
billing the city twice for some loads of trash;
weighing truck drivers and their helpers along with the trash;
the city pays for trash disposal by weight.
According to the TIMES-PICAYUNE, Charles Dees III, Waste
Management’s regional vice-president, said his company had
cooperated throughout the inquiry, and he said there is no
evidence to support Mr. Koloski’s and Mr. McFarland’s charges.
According to Sanitation Director Koloski, the overcharging may
have amounted to as much as $2 million over the 12-year period
since 1976, when the city began dumping its garbage at the
Recovery 1 landfill, owned and operated by Waste Management.
During the past two years, the city has privatized garbage
collection and American Waste and Pollution Control has won the
contract to provide pickup throughout the city. American Waste is
a subsidiary of Waste Management.
Mr. McFarland was appearing before the Council Oct. 6 partly to
protest the city’s failure to investigate fully Mr. Koloski’s
earlier charges that WMI had overcharged the city during a
12-year period. The city had asked a certified public
accountant, Deloit, Haskins and Sells, to investigate one year’s
worth of dealings between the city and WMI. The accounting firm
reported finding only $2800 in erroneous charges. The city’s
chief administrative officer, Kurt Steiner, said he had ordered
an investigation of only one year’s dealings with WMI because
WMI had only been picking up city garbage for that long. He said,
“We had to start somewhere and we do intend to review
transactions in prior years.”
Sanitation Director Pat Koloski appeared before city council
recently to request review of 12 years of records, which he said
would show that WMI had overcharged the city by as much as $2
million. The TIMES-PICAYUNE reported that immediately after Mr.
Koloski made his charges, the FBI subpoenaed city records dating
back to 1976 and ordered delivery of the records to the grand
jury Oct. 7, the day Mr. McFarland appeared before the grand
jury. Robert Boitman, an attorney on the staff of John Volz,
federal district attorney in New Orleans, would not confirm or
deny for HWN that a grand jury is investigating Waste Management
and/or the alleged death threats against city employees. City
councilperson Peggy Wilson told us that the matter was out of
Council’s jurisdiction now that criminal charges might be
involved, and she said she believed the federal district
attorney’s office would be investigating the death threats.
Waste Management has recently pleaded guilty or no contest in
other jurisdictions to charges of illegal price-fixing and
bidrigging. In Fort Lauderdale, Florida, on January 15, 1988, WMI
was fined $1 million after pleading no contest to a federal
charge that it illegally controlled competition among garbage
haulers in Broward County, FL, the Ft. Lauderdale SUN-SENTINEL
reported Jan. 16, pg. 1A. Justice Department attorney James
Griffin said the company and other unnamed haulers drove up
prices of garbage collection by refusing to bid against each
other for contracts. The practice cost consumers “millions of
dollars,” according to court records. Three days earlier the
waste giant was fined $725,000 in a Florida court for damages and
penalties stemming from separate charges that it fixed prices and
rigged bids in Dade County, Florida, according to the
SUN-SENTINEL Jan. 13, 1988, pg. 3B. Both cases involved a
wholly-owned subsidiary called Waste Management of Florida. Waste
Management, Inc., has itself organized into at least 772
subsidiary corporations to minimize the parent company’s
liability.
The SUN-SENTINEL on Jan. 13, 1988, quoted Jerome Hoffman, who
heads the antitrust division within the office of Florida’s
attorney general, Robert Butterworth, saying that Waste
Management and other garbage haulers had been charged with
price-fixing in a civil suit by a group of south Florida
businesses and that the case was about to be settled for $2
million. To our knowledge, no such a settlement has ever been
announced.
–Peter Montague, Ph.D.
Descriptor terms: wmi; death threats; property rights; violence;
la; new orleans; price fixing; bid rigging; fraud; violations;
bfi; fl; investigations