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Audit questions Georgia’s need for full scrap tire fee

A new audit says the state is raising more than enough money from its $1 fee on tires to clean up tire dumps and that it should do a more thorough review of program costs before asking lawmakers to renew the fee again.

The analysis by the Georgia Department of Audits and Accounts said while the so-called “scrap tire fee” that consumers pay when they buy new tires has been unchanged, the number of cleanups and other activities funded by the Solid Waste Trust Fund has dropped over the past 10 years.

The amount of estimated revenue from the tire fees — almost $32 million over five years — is more than enough to pay for all the authorized uses for the fund, auditors said. However, not all that money is allocated by the General Assembly to the Solid Waste Trust Fund program.

The review also found that the program “lacked methods to prevent new scrap tire dumps, to ensure dumps are cleaned up, and to ensure that the state is collecting all scrap tire fees owed.” While some of the problems have been addressed, the audit said the program’s inspection and enforcement activities have not prevented the creation of new scrap tire dumps.

The report said as of December, the program had cleaned up about two-thirds of the nearly 8,000 scrap tire dumps in the state Environmental Protection Division’s inventory. It added: “Little action had been taken to address the 248 dumps and 545,000 scrap tires that remained. According to program records, the last recorded actions on those dumps — frequently an initial investigation — was an average of 1.7 years ago.”

Auditors found that there were often not enough inspectors, with positions being open for years in some cases. It said program officials were often dealing with faulty information.

“We also found that the program is likely collecting only a portion of scrap tire fees owed to the state,” the report said. The amount raised from the fees — which tire stores collect to get rid of old tires when you buy new ones — has remained relatively constant for 15 years even though the state’s population — and likely tire buying — has increased. Auditors estimated the state could be losing out on about $1.8 million in tire fees each year.

Auditors said the EPD should do a more formal review before the tire fee comes back up for reapproval by the Legislature in 2019 to determine whether it should be kept at $1, lowered or eliminated.

In the audit report, EPD officials said the findings “reflect the impact of a legacy data system, decentralized organizational structure and years of reduced program funding.” Officials said in the audit that the agency has already addressed some of the findings, including creating a fully staffed unit to attack tire dump problems.

Mary Walker, assistant director of EPD, told The Atlanta Journal-Constitution on Friday that her agency was working on many of the issues raised by the audit before the review was underway. The agency has been working on IT changes to allow it to better determine whether the state is getting all the fee money it is supposed to receive.

While the audit mentions a host of authorized uses for the tire fee money, Walker noted that the agency has, for the most part, only been funded to clean up scrap tire dumps. And that was only in the years when the General Assembly agreed to spend any money on the program.

As to whether the fee should remain $1 per tire, Walker said, “I think the discussion about what the fee should be is a legislative discussion.”

In other words, it’s up to lawmakers.

The program has been somewhat controversial over the years, not because of the EPD's work, but because state budget writers have long diverted tens of millions of dollars from special funds such as the Solid Waste Trust Fund to fill holes elsewhere in the budget .

Combined, tire and landfill fees bring in about $16 million or so a year. Environmentalists and county officials say about $130 million has been diverted from funds to clean up hazardous waste and tire dumps into the state’s general fund, where it pays for services and programs such as schools, trooper patrols, prisons and economic development. County officials have said the fees should be cut or eliminated if the state isn’t going to use the money for its intended purpose.

Legislative leaders say they need to have flexibility to use the money for other things, and Gov. Nathan Deal’s office has opposed legislation to mandate that the fees be reduced if they are being diverted.

When lawmakers extended the landfill fees for the Hazardous Waste Trust Fund in 2013, they included language saying they had to be reduced if the fee money was diverted. Deal signed the fee extension bill, but he added a so-called "signing statement" declaring that the fee reduction language was nonbinding.

Walker said she understood the General Assembly’s decision to divert money during the Great Recession.

“If you have to keep schools open, and we had some reserves, that (tire dump cleanups) was probably not the best use of limited resources,” she said.