Democracy In Albany

"It is somewhat of a supply-and-demand issue," Leistensnider added, acknowledging concerns that if the city were to raise tipping fees the private haulers and municipalities might take their business elsewhere.

All revenue from the landfill, Leistensnider noted, goes to the city.

Councilman James Sano, chairman of the council Finance Committee, said bonding has "always been the way it was planned," and he questioned what would happen if higher tipping fees drove customers away.

"Then how are you supposed to fund it?" he said.

Last week, the mayor defended his agreement to cut Allied's tipping fee from $46 a ton to $38, a 17 percent reduction. The two-year pact came after the company - the nation's second-largest hauler - threatened to load its garbage onto trains bound for an Allied-owned megadump in South Carolina.

"Those guys held us hostage," the mayor said. "If we don't have the $6 million a year that we get from Allied, I have to lay off workers. It would impact the city's budget dramatically. This was a short-term step to maintain liquidity."

Jennings does not need Common Council approval to set dumping fees, or for any other city contract.

Allied dumping shot up after the price break, from 85,000 tons in 2004 to 140,000 tons last year, the equivalent of 11,000 garbage trucks.

The Times Union conducted a computerized analysis of a quarter-million dump bills dating to 2001.

With headquarters in Scottsdale, Ariz., and annual revenues of $14 billion, Allied operates dumps and transfer stations in 37 states. Garbage hauled to Albany by the company now accounts for almost half of the $13 million in fees earned annually by the city.

This year, Allied is on pace to dump 175,000 tons, which would account for more than half of all incoming garbage.

"It is like we are running the landfill for the benefit of Allied," said 2nd Ward Common Council member Dominick Calsolaro. "I am amazed this kind of deal was done more than a year ago, when they were out there yelling that we were running out of landfill space and it was an emergency, and we had to expand into the Pine Bush.

"Instead, we should be extending the life of the landfill by taking less garbage. That would be a benefit to the citizens of Albany, who wouldn't have to pay for a new landfill so soon."

Jennings' proposed budget includes $9 million to expand the landfill in 2008.

Neither Calsolaro nor 12th Ward Council member Michael O'Brien, chairman of the General Services Committee that oversees the dump, knew about the Allied deal before being informed of it by the Times Union.

In response to a question from O'Brien during a budget presentation to the council on Monday, General Services Commissioner Bill Bruce said the city was charging commercial haulers "in the $60s."

In a subsequent interview with the Times Union, Bruce said he included a line on the Allied rate in a spreadsheet about Rapp Road finances that he had provided to city lawmakers in June.

On Wednesday, the mayor backed his commissioner. "It's not my fault that they didn't read it after they asked for it," Jennings said with a shrug

Councilman James Sano, chairman of the council Finance Committee, said bonding has "always been the way it was planned," and he questioned what would happen if higher tipping fees drove customers away.

"Then how are you supposed to fund it?" he said.