With Hurricane Irma debris gone, counties, cities grapple with financial fallout
A year after Hurricane Irma laid waste to Southwest Florida's landscape, cash-depleted local governments have yet to be fully reimbursed for the epic debris removal effort, and the ripple effect may affect some budgets for years to come.
Like other local governments across the state, Collier County paid contractors to collect, haul and process the mounds of mangled trees, broken branches and splintered fences left behind by the storm, an effort that took months and cost millions. Some cities — like Naples and Marco Island — outsourced the debris pickup to the county, while others — like Bonita Springs — tried to go it on their own.
All had to dip into savings or put projects on hold to pay for massive expenses. Reimbursements from state and federal officials have only recently begun trickling in, and many municipalities have yet to recoup any money for their debris removal costs.
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For Collier officials, Irma brought home the need to begin building a dedicated reserve fund for debris removal efforts for future storms. To do so, county officials plan to have a portion of the tipping fee at the landfill flow into that reserve.
“We did have reserves but not to the quantity that we probably need for a Category 3 storm or greater,” said Dan Rodriguez, the county's public utilities deputy director , adding that the fund is forecast to generate about $3.7 million next year.
Irma expenses delayed public works projects
So far, Collier's public utilities division has paid more than $53.7 million for debris removal, according to county officials. As of Aug. 29, across all departments, the county had received nearly $70 million worth of invoices for debris-related work, but some of those invoices are still being approved, audited or are not yet due, according to the clerk of court’s office.
To pay contractors, county officials pulled about $32.4 million from capital projects and $21.3 million from reserves, both from the public utilities department.
“In essence, that’s been the notion throughout; the utilities projects have been put on hold until we can recover from the Hurricane Irma debris,” said Dilia Camacho, interim director of the solid and hazardous waste management division.
Workers unload mixed debris at a central lot in Everglades City. The debris is to be sorted and loaded into larger trucks for removal from the island. Brent Batten/Naples Daily News
Money was temporarily diverted from more than a dozen projects in public utilities, including:
- $7 million to help construct a “deep injection well” that would pump landfill runoff into the ground to dispose of it more efficiently and cost-effectively.
- $3.8 million to help replace aging water mains in Naples Park.
- $3.6 million for repairs and modifications at wastewater plants.
At the high end, some of the projects could be delayed six to nine months, Rodriguez said.
However, he added, “There’s other work that can be done” on some of the projects in the meantime, such as engineering.
County officials plan to return the funds to the projects and reserves on a “prioritized basis” as federal and state dollars start flowing into county coffers. In July, Collier received its first reimbursement, totaling about $10 million, from the Federal Emergency Management Agency and the state.
The county is expecting to receive another round of reimbursements totaling about $46 million, Rodriguez said. The hope is to receive those funds, which are still being reviewed by federal officials, in the next 60 to 90 days, he said.
If they’re approved, state officials will conduct a final review before disbursing the funds to the county.
Lee County racked up a $39 million tab for debris collection — 2.7 million cubic yards in all — in unincorporated Lee and the Village of Estero. It is hoping to recoup about $35 million, county spokeswoman Betsy Clayton said. So far, Lee has not received any money from federal or state officials.
Neither have Naples, Marco Island or Bonita Springs.
The waiting game
Rodriguez said red tape and the magnitude of last year's hurricane season could be part of the reason the reimbursement process takes a long time.
“Every county in the state of Florida was hit,” Rodriguez said. “And then coming off of (Hurricane Harvey) in Texas, they’re already busy managing that.”
Debris removal reimbursements to local governments are made on a first-come, first-served basis. The county falls further down the payout list if FEMA has to wait for county paperwork.
Collier’s largest debris-related claim — debris management from October 2017 through March 2018 — included more than 200,000 documents, according to county officials.
Collier hired a slew of contractors to handle different responsibilities related to the debris removal process, including a company to lead the cleanup, processing and hauling efforts; one to monitor debris pickup; another to clear canals and waterways; and a consulting firm to help maximize state and federal reimbursements.
Due to the large demand for debris pickup created by Irma across the state, contractors were initially struggling to pull resources to Collier, Rodriguez said.
“On the onset of the hurricane, all of our contractors were having challenges getting equipment here,” he said. “And there was probably that first, second week where we’re anticipating equipment to come that didn’t show.”
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AshBritt Environmental Inc., the Deerfield Beach-based company hired to haul the piles of debris, drew resources from as far away as Washington, Pennsylvania, Ohio and California, and eventually “ramped up” collection efforts in Collier, Rodriguez said.
Jared Moskowitz, general counsel for AshBritt, noted that the cleanup in Collier was the biggest done in Florida after Irma, “2½ times” the next largest effort in the state, and said it was completed at one of the fastest paces ever.
Rodriguez said Collier “had the fastest recovery, based on our consultants and our contractors, in the nation. In 3½ months, 3.6 million cubic yards — that’s quicker than any contractor that has worked in Katrina or Sandy, some of the major events.”
Debris haulers investigated for Irma work
In the wake of the massive storm, some cities and counties across Florida tossed out prior contracts to pay debris collectors more to speed up collection.
But Collier stuck to its pre-storm contract with AshBritt and “had some of the lowest rates in the state,” Rodriguez said. He said Monroe County, for example, saw rates rise to more than $20 per cubic yard.
Collier’s average rate was about $8 per cubic yard, although it ranged from $5.50 per cubic yard to $13 per cubic yard based on the type of debris and how far trucks had to haul it to the county’s six debris management sites.
In Collier, officials were content with how AshBritt performed. But the company has caught the attention of the Florida Attorney General’s Office, which issued subpoenas to AshBritt and two other major debris collectors after the storm.
Investigators are seeking to find out whether the companies were failing to perform at pre-storm contract rates, not performing until higher rates could be negotiated or were slow to perform under existing contracts.
A dump truck adds to a pile of horticultural debris at a collection site at the Collier County landfill off County Road 951 near Interstate 75. The site is the largest of six in Collier County where hurricane debris is being mulched for use later in agriculture. Each one of five piles of debris at the landfill measures 20 feet tall and a quarter of a mile long. Wochit
Two of the contractors — DRC Emergency Services and Ceres Environmental Services — are cooperating with the investigation, but AshBritt “filed an action in court to quash or modify our investigative subpoena,” Kylie Mason, a spokeswoman for the Attorney General's Office, said in an email.
Mason said the court ordered AshBritt to comply with the subpoena and that the company filed papers to appeal the court’s decision. She declined to comment further, citing the ongoing litigation.
Moskowitz said the company is looking forward to a “speedy” conclusion of the investigation.
Naples working to replenish reserves
Debris removal was Naples’ third-highest Irma expense, totaling more than $2 million, or about a fifth of the money the city spent on Irma.
To date, Naples has spent $9.3 million on Irma-related expenses, which doesn’t include the estimated $6 million to $10 million it will cost to replace all of the trees the city lost. The city has submitted $4.2 million to FEMA for reimbursement.
The city hasn’t received any money from FEMA, and officials say it could be years before it does. The city’s net loss after FEMA and insurance reimbursements is expected to be between $2 million and $2.5 million.
That money will come from the city’s emergency fund, leaving roughly $1 million for future disasters. The city’s proposed 2018-19 budget, which is set to be approved later this month, includes a small property tax increase to help replenish the emergency fund.
The city plans to put $500,000 in the emergency fund each year until it’s at pre-Irma levels, which will take approximately four to five years; however, councilors could decide during budget discussions later this month to expedite the replenishment process.
Dana Souza, director of community services, said the city deployed its own staff and resources to start the debris removal process immediately after the storm.
The county landfill bristles with activity as trucks deliver loads of debris from Hurricane Irma. So far, about 2.8 of an estimated 4 million cubic yards of debris have been collected. The work is expected to continue until about the end of the year. Wochit
AshBritt didn’t arrive until Sept. 22, nearly two weeks after Irma made landfall, and “a consistent and meaningful daily quantity of debris removal” didn’t start until Oct. 5, according to the city’s after-action report.
Despite the delay, Souza said the city was generally happy with the response and has no plans to revisit its contract with the county.
“We intend to continue with the interlocal agreement with Collier County. Through their primary contractor, AshBritt, the response to city needs was excellent overall,” he said. “The only change we hope could be made, is to get the subcontractor trucks working sooner.”
‘We shouldn’t be paying … for a job that’s not getting done’
Like Naples, Marco Island has an interlocal agreement with the county, and it, too, experienced delays in service, prompting some residents to question the effectiveness of the partnership.
“Where has waste management been for the past two weeks picking up bulk?” one resident asked the Marco council at its Oct. 2 meeting. “If they were picking up bulk immediately after the storm, it wouldn’t look like it looks now. I know that the situation is overwhelming with the debris; we shouldn’t be paying Collier County … for a job that’s not getting done.”
Jared Grifoni, Marco Island City Council chairman, did not expressly say that the city wants to terminate its agreement with the county or that he was unhappy with the debris removal process; however, he did cite the city’s after-action report, which recommends evaluating the debris removal agreements with Collier County.
The city’s Ad Hoc Hurricane Review Committee issued its own report in June that stressed the need for better coordination with the county.
County Waste employee Terry Summerson uses a hydraulic claw to collect hurricane debris Friday on Mahogany Wood Drive on North Naples. Summerson fills his tandem truck up about six times a day hauling off 134 cubic yards of debris in each load. Wochit
"Coordination ahead of time is imperative to ensure proper support during and after an event,” the report reads. “There is a good deal of evidence that more should have been done in the months and weeks leading up to hurricane season to better coordinate expectations."
Marco Island has spent $8.7 million on Irma-related expenses so far, but that number could climb once everything is said and done, interim City Manager Gil Polanco said. All of the money came from the city’s reserves.
Bonita budget woes
Bonita Springs faces financial hardship in the wake of Irma.
“The net effect of $9 million (in Irma costs) is highly significant on our relatively small financial situation,” City Councilor Peter O’Flinn said.
Bonita Springs is projected to bring in $33.6 million in revenue in the coming fiscal year.
Debris cleanup cost nearly $8 million, with road and drainage system repairs adding another $1 million. The city’s emergency reserves were quickly emptied, but the city used money from other parts of the budget to cover short-term costs.
The City Council is set to approve a budget that would leave the general reserves at $758,000, which means a few overbudget construction projects or a major road failure could drain the remaining money pool dry.
For comparison, Naples has about $7 million in unassigned fund balance reserves.
Bonita Springs officials are opening a line of credit for emergency use while waiting for an expected $6 million in FEMA money to refill the reserves to be used specifically in the event of another disaster.
The city’s long-range budget plans for the cash to come in 2021, although FEMA hasn’t given any timeline to city officials.
Bonita Springs opted to contract directly with a debris removal company instead of partnering with a county as Naples and Marco Island did.
Instead of receiving a bill after the cleanup was finished, Bonita Springs paid as it went. At one point staff thought total cleanup costs would top $12 million and were worried about finding money in the budget.
However, the City Council had local control over some temporary debris dumping sites to minimize trip costs and could direct crews to areas hit hardest by flooding. The city also ended service when costs rose too high, telling residents to use normal garbage pickup after two sweeps of the city.
Bonita Springs city councilors voted 4-3 against raising property taxes to bring in several million additional dollars to recharge the reserves after Irma. Councilors in favor of a tax increase wanted to refill reserves as quickly as possible and not rely on lines of credit for emergencies.
O’Flinn said he would be open to partnering with Lee County for future disasters to avoid the cash crunch presented by Irma, although the county would have to agree.
“In hindsight, people can say (our own contract) put us in more control, but I think, considering the cash flow strain that has appeared, we would want to think hard about doing it again,” he said.