STAMFORD - Two Connecticut cities have histories with a slippery revenue source.
That’s all the discarded light poles, manhole covers, snowplows, Dumpsters, traffic signs and other items made of aluminum, iron, steel and copper that cities do not throw in the garbage because they earn money at the scrap yard.
In Bridgeport, the state’s largest city, scrap metal has been disappearing. Someone in November wrote an anonymous letter to the Bridgeport City Council reporting an off-the-books scrapping operation. Last month the FBI began a criminal investigation.
In Stamford, predicted to become the state’s second-largest city after next year’s Census count, scrap metal disappeared for decades. Whistleblowers reported in 2010 that city employees were selling it for cash.
But the FBI did not investigate. No one was charged and no one was fired, even though some city employees admitted taking money for metal. Stamford police and the state’s attorney determined that it was not theft because self-scrapping was an old practice and the city did not have clear policies against it. They concluded that no more than $15,000 had been stolen over five years.
In Bridgeport, the anonymous letter writer said the scrap-for-cash “scam” had netted $25,000 over two years. The Connecticut Post then obtained documents showing $35,500 in transactions between city workers and Bridgeport’s contracted scrap dealer.
The FBI is still looking.
The Bridgeport numbers may end up a lot bigger, if Stamford is an indication.
Scrap tonnage figures indicate a substantially larger amount of metals went missing in Stamford, and they were worth a lot more than the $15,000 law enforcement authorities cited.
In 2009, before the scandal broke, the city recouped cash for 268 tons of scrap. The year after thefts were revealed, the volume more than doubled to 565 tons.
After 2010, the annual amount sold hovered around 600 tons — until 2013 and 2014, when it approached 700 tons.
Sales reached a high of 895 tons in fiscal 2015-16, followed by 826 tons the following year, for revenue of $110,000 over that period.
Revenue amounts depend on the commodity market at any given time, but before the scandal broke the city could expect to earn an average of about $50,000 a year from scrap sales; afterward it was $115,000.
Market conditions were good last year, when the city sold 708 tons and earned $116,000.
It looks like the city has earned $300,000 to $400,000 more than could have been expected had the tonnage remained at pre-scandal levels.
And it looks like that may continue.
‘We don’t play’
Dan Colleluori, who became supervisor of solid waste and recycling about the time the scandal broke, said procedures Stamford adopted then have been effective. All scrap metal now goes through his department, where it is placed into containers owned by the city’s contracted scrap dealer, Rubino Brothers, Colleluori said.
“Rubino Brothers picks up their containers at our transfer station, drives them over our scales, then sends us a check every month for the weight,” Colleluori said. “If I get a note from a school that they have a pile of metals, Rubino brings a container there, it gets filled, then they bring it to the transfer station to be weighed. There’s no cash and carry. We don’t play that game.”
The scandal revealed that some city workers were scrapping metal during their lunch hours. They told investigators it came from their side businesses, not the city. Some said they were paid cash by certain scrap dealers, including one in Norwalk, and put it on their supervisor’s desk.
A Rubino Brothers employee told investigators city employees sometimes asked to be paid in cash. The investigation showed that Rubino Brothers made 206 cash payments to city workers, but the city had receipts for only three.
It doesn’t work that way now, Colleluori said.
“A hard-copy check comes to my department from Rubino Brothers, gets processed and is deposited in an account called Revenue Mixed Metal,” he said.
Why no FBI?
Before the scandal, the scrapping procedure was a mess, said Sal Gabriele, who was among the handful of elected officials who tried to act on the whistleblower reports. Gabriele, then a member of the Board of Representatives, now sits on the Board of Finance and is the only remaining elected official from the time.
“The City of Stamford should have turned over the scrap metal investigation to the FBI in April of 2010,” Gabriele said. “I commend the Bridgeport city managers for doing the right thing. When city employees were stealing scrap metal here several years ago, high-ranking Stamford officials decided it was better to persecute the whistleblowers and make excuses for municipal corruption rather than hold the scrap-metal thieves and their official enablers accountable, as it seems Bridgeport has rightly decided to do.”
The Stamford scandal broke when a supervisor in the Office of Operations showed up in the city purchaser’s office after Gabriele and other officials began asking about some missing snowplows. The supervisor handed the purchaser $3,149, saying he’d scrapped some plows. The purchaser called police, since only he was authorized to release city property for scrapping.
Police found no wrongdoing. Dissatisfied, elected officials hired a private auditor, which cost taxpayers $150,000. The auditor found possible criminality. The case went back to police, then to the state’s attorney, who determined there was no evidence of theft.
A political firestorm resulted, sparking multiple lawsuits, ethics charges and the resignations of elected officials.
In 2011 then-Mayor Michael Pavia suspended the director of the Office of Operations for three weeks without pay. Pavia also suspended two Operations supervisors for two weeks without pay, but they grieved the action with their union and won, and their pay was restored.
Operations employees told investigators the cash they took was used for “morale-boosting activities,” such as lunchtime pizzas or birthday cakes, and an annual holiday party.
That’s what city workers in Bridgeport’s Public Facilities Department are saying. They call it the “sunshine fund,” and say the money is used to purchase meals, cakes and event tickets to boost employee morale.
Bridgeport Police Chief Armando Perez told the Connecticut Post he contacted the FBI as soon as he received the anonymous letter. Bridgeport Mayor Joe Ganim, who served seven years in a federal prison after he was convicted on 16 corruption charges stemming from his first mayoral stint in the 1990s, has said calling the FBI was the right thing to do.
Last month Ganim docked the pay of Public Facilities Director John Ricci for two weeks. Ganim also took away two weeks of Ricci’s vacation pay, which will cost him about $5,200 of his $134,600 annual pay. Ganim has said he will discipline three other city employees, but declined to provide details until they have had their union hearings.
Colleluori said Stamford has largely learned its lesson. Big metal items, such as Dumpsters, cannot be scrapped without filling out a form that the city purchaser must approve.
“All metals from all projects in the city are supposed to come through us. Does it always happen? Probably not. There’s metal we’re losing, I’m sure,” Colleluori said. “But I think the numbers show that the system, by and large, is working.”
At the Magee Avenue recycling center, city employees and residents are directed not to remove anything from the Dumpsters, Colleluori said.
“I have cameras there and a supervisor there who knows the rules,” he said. “I’ve talked to my employees about it until I’m blue in the face — ‘don’t do this; it’s not worth it.’”