Heated words exchanged over Red River’s future at City Council

Local News

FORT WAYNE, Ind. (WANE) – Tempers flared at Tuesday’s Fort Wayne City Council meeting over the future of Red River Waste Solutions after the company filed Chapter 11 bankruptcy last week.

The exchange started when Councilwoman Sharon Tucker (6th District) asked a question to Matt Gratz, the city’s manager of the solid waste department, about what he knew about Red Rivers’ financials.

After banter back and forth, Councilman Glynn Hines (At-Large) stepped in and told Gratz to change the way he addressed the council.

“He (Gratz) told the council that he did not fully penalize them when they have misses is because it would hurt them negatively and financially because they were not in good financial standing,” Hines said. “So when he yelled at Councilwoman Tucker and denied he ever knew of any issues with their financials was not factual.”

Before the debate came the news that officials with Red River failed to comply with the council’s request to come before council. Attorneys on behalf of the city, who had spoken with Red River officials earlier in the day, told the council they had a “scheduling conflict.”

For well over an hour council spoke with two attorneys, who are the corporation counsel for the city, over what could happen next when it comes to the trash collector. Last week Red River filed Chapter 11 bankruptcy in Texas.

“That allows them the privileges which is the opportunity to present a plan of reorganization,” said attorney Timothy Haffner. “They’ve (Red River) committed to continue service, they want to continue servicing whether that’s in the form of a re-organized company or involvement of a partner, we don’t know yet if they don’t know yet but waiting to see how that plan unfolds.”

During the meeting, Haffner and his partner, Jay Jaffe, explained to the council what Chapter 11 bankruptcy was and that Red River has three options moving forward:

  1. Reorganizing the business
  2. Selling the business
  3. Hybrid of one and two

According to the attorneys, if a third party buys Red River the city would have to go with the third party. The city could explore but not sign another contract before Red River rejects the current contract. Fort Wayne could ask the court (in which Red River has filed Chapter 11 bankruptcy) to reject the contract.

When Red River filed for bankruptcy the court had the right to propose a plan for the first 120 days after they filed and no one else can propose a plan. Jaffe says Red River’s counsel has informed them that they believe the bankruptcy process will take at least six months to complete.

In the meantime, the council was advised that trash collection would continue and to start looking for other companies to take over the city’s contract in the event Red River shuts down.

Council also wants to remind residents to report all missed collections by calling 311.

In addition, council approved a three year contract to increase police officer pay by 5%. This increase would put the officers’ pay near what Indianapolis Metropolitan Police Department officers make. The final vote for this increase will occur during the final budget vote.

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