Waste Management Audit Process Criticized By City Council

Image: Waste Management.
Image: Waste Management.

Members of the Reno City Council had harsh words today over a financial audit of the city’s agreement with Waste Management.

Councilmembers said that the three-page audit report, which found the waste hauler met its financial obligations to the city in 2014-2015, fell short of what they originally wanted from the outside review.

Councilman Paul McKenzie said the audit findings were not in line with what council originally requested from city staff, such as how much recyclable material ends up in landfill.

The audit, however, looked at whether Waste Management is accurately paying its fees to the city.

The auditor, Richard Bowler of Piercy, Bowler, Taylor & Kern, said, “The result of the examination was that the franchisee is in compliance with the contract as far as payment of franchise fees to the city.”

When pressed for the audit’s findings, and to elaborate, Bowler essentially repeated the same statement.

Councilman Paul McKenzie
Councilman Paul McKenzie

McKenzie was not satisfied with that response, but he blamed city staff for not providing council’s requested direction for the audit.

“It would appear that the conclusions that they came to met the requests of the engagement letter, but my concern is that the issue that brought rise to our discussion about having an audit was not the refuse as much as it was the recycling,” he said. “We had some statements made in a meeting here talking about increases in recycling but we weren’t seeing an equal increase in franchise (fees) from recycling….

“Additionally, we didn’t have a clear (idea) about what was being done with the recycled material. There were concerns that it was being taken to landfill rather than being recycled or that it may or may not have been sent to another facility that the company owns and that we weren’t getting credit for it.”

Bowler said his firm did not do an analysis or investigation of what Waste Management does with recycled materials but that revenue from recyclables was included in the audit.

“The materials collected by the franchisee, including recyclables, are the property of the franchisee, and normally, my layman’s opinion — not a legal opinion — (is that) if you have property you can dispose of it as you choose to,” Bowler added.

Naomi DuerrMayor Schieve said, “I feel like staff was a little confused as to what council was really requesting, and I feel like those questions were not answered. But I think there was a lot of confusion and uncertainty from the direction from council to staff.”

Councilwoman Naomi Duerr said that she was clear about what she wanted to see from the audit.

“We discussed them and discussed them and discussed them at at least three outings with the council,” she said.

Schieve added: “We were very clear, but I think staff had a totally different idea of what they wanted to see versus what this council wanted to see, and that’s unfortunate. I feel like unfortunately there’s been some differences of opinion.”

Because of that, McKenzie said he was unwilling to accept the auditor’s report.

“I want to see the entire report with all the numbers,” he explained.

City staff was directed to review what was intended by the council and to see if the audit can provide the originally requested information.

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Bob Conrad is proprietor and co-founder of ThisisReno. He manages ThisisReno and Conrad Communications, LLC, his marketing communications consulting company (disclosure: client work includes projects funded by grants through UNR) and is an adjunct faculty member at Truckee Meadows Community College.