SAN FRANCISCO—San Francisco customers of the waste management company Recology will be receiving almost $100 million in overpaid rates for their trash collecting services. A probe from the City Attorney’s office gave details on Thursday, March 4, 2021, of how the company hiked their prices over the last four years. The rate hikes are connected to Mohammed Nuru, the former Public Works Director who has been at the center of City Hall’s corruption scandal recently.
San Francisco City Attorney Denis Herrera, was in charge of the probe that found that Nuru accepted bribes from Recology in exchange for allowing the company to inflate its rates. A former Recology executive was fired and arrested in November in light of these allegations of bribery. Officials stated that in addition to the alleged bribes, Recology failed to account for revenue it would receive from ratepayers during its application for a rate increase in 2017. Officials said these underreported funds amounted to a rate increase of 14 percent instead of the 7 percent which Recology was set to receive.
Recology released a statement in which they categorized the rate hike as an inadvertent mistake that they reported to the SF City Attorney’s Office. Recology made the disclosure in December 2020 which is a year after being subpoenaed by the SF City Attorney’s Office.
The company will now pay $94.5 million to ratepayers in reimbursement for the overcharging that took place. Starting on April 1, 2021 they will also lower their residential & commercial waste rates for it’s 160,000 customers in San Francisco.
“With this legal action, we are making San Francisco ratepayers whole and sending a clear message that cozying up to regulators won’t be tolerated,” Herrera said in a statement.