Audit criticizes handling of waste tire program

BATON ROUGE (AP) — The Department of Environmental Quality hasn’t properly collected fees in a program designed to keep tires from being dumped illegally, getting shortchanged on payments and issuing few penalties for late fees, according to an audit released Monday.
Louisiana residents pay a fee when they buy new tires to help cover the cost of disposal of old tires. The business that sells the tires, like Walmart or Sears, is supposed to submit a report and the money monthly to the environmental quality department, known as DEQ.
Legislative Auditor Daryl Purpera’s office said those businesses paid DEQ late in many instances and didn’t always file required reports, with no repercussions. Only one of 1,045 delinquent companies received a fine in the 2013 budget year, according to the audit.
“Overall, we found that DEQ needs to improve its management of the (program) and consistently enforce program requirements to ensure that the state receives complete, accurate and timely waste tire fees,” auditors wrote.
In a DEQ response, Undersecretary Vince Saghibene said most data cited in the auditor’s report pre-dates a series of improvements made to the program, which was created in 1989.
He said the formal penalty process wouldn’t generate “significant extra funds for the program” because many of the businesses that didn’t report monthly as required made few, if any, tire sales that required fee payments.
“The Department continues to believe it manages one of the most effective waste tire programs in the United States. Since the inception of the program, it has successfully cleaned up over 7 million waste tires, and has continued to prevent the creation of new waste tire piles by operating an effective subsidy program,” Saghibene wrote.
Louisiana pays waste tire processors for the disposal and recycling of old tires, using the fee paid by people buying new tires. The state collected $10.7 million in waste tire fees from nearly 2,300 businesses in the state budget year that ended June 30, 2013, the most recent year reviewed by the auditors.
The program has received complaints about poor management for years.
In December, Purpera’s office found that the environmental quality department could have overpaid the processors because it wasn’t double-checking the weights reported on their invoices.
Monday’s audit said one-quarter of the companies didn’t submit at least one required monthly report in the 2012 budget year and that grew to 40 percent a year later. Nearly 11 percent didn’t submit any report during the 2013 fiscal year.
In addition, auditors said they found 1,001 companies submitted $2.9 million in fees past their due date over two years. DEQ only audited an average of 3 percent of the companies that were supposed to be paying monthly fees during the three-year span reviewed by auditors.
A task force created by state lawmakers in 2013 to study the Waste Tire Management Program has never met, though recommendations were supposed to be due in February.

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