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Shredding Solutions loses contract over payments

United States – Officials in the US state of Nebraska have cancelled a contract with long-term recycling partner Shredding Solutions Inc. following the discovery that the company owes more than US$ 60 000 for taking thousands of tons of used office paper off its hands.

According to auditor Mike Foley, the contract requires Shredding Solutions to pay a monthly fee based on the per-pound rate set for the Chicago market. However, the recycler has been paying a flat US$ 25 per ton ‘under a verbal agreement’ ever since it started shredding the state’s paper in 2003.

The disparity is significant given that market rates have ranged from US$ 55 to more than US$ 100 per ton, says Foley. Payments have arrived increasingly late too, he adds.

Foley attributes the situation to ‘lax oversight’ by the state’s Department of Administrative Services and to ‘the contractor taking advantage of the lax oversight’. Of the total sum owed, Shredding Solutions has paid roughly US$ 30 000.

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Source: APNews

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