Fort Wayne garbage collection service, Red River Waste Solutions, files for bankruptcy
FORT WAYNE, Ind. (WPTA) - The company contracted to provide trash collection for the City of Fort Wayne has filed for Chapter 11 bankruptcy.
Red River Waste Solution, LP made the filing with the U.S. Bankruptcy Court in the Northern District of Texas Thursday blaming the COVID-19 pandemic for the company’s financial downturn.
Specifically, Red River states the pandemic created a need to hire more workers because more people were staying at home and there was more trash to collect.
The company also said the pandemic made it hard to hire extra workers making it difficult to pick up the extra trash. The poor service caused cities to fine Red River for failing to meet the terms of their contracts, according to the filing.
Earlier this year, ABC21 reported missed trash pickups appeared to be increasing throughout the city, with the West Central neighborhood in particular complaining of issues with trash collection.
Red River has had years of documented collection issues in Fort Wayne
Issues in Fort Wayne existed before the pandemic.
In 2018, ABC21 uncovered thousands of complaints submitted to the city about Red River’s services over the course of eight months.
In Thursday’s filing, the company says its revenue dropped by $1 million between March 2020 and February 2021, with expenses increasing by $1.3 million in the same timeframe.
The company received notice in July it defaulted on a loan taken out in April of last year.
In the filing, the company lists three options they will pursue in bankruptcy, which included a plan to restructure or downsize their company, seek outside financing or sell the business in two parts.
It isn’t clear if the bankruptcy filing will have an immediate impact on trash collection in Fort Wayne.
Fort Wayne city council member Sharon Tucker serves on the Solid Waste Advisory Board, created to work on possible solutions to the trash collection problems.
We asked for her thoughts on the bankruptcy filing.
“So that really, really makes me worry and that is one of the reasons that I had pushed in our solid waste advisory board that we have a contingent plan in place, not in the event of us releasing Red River, but in the event that Red River just can’t hold up to the agreement any longer. So hearing the Chapter 11 makes me worry,” Tucker said.
A representative from Red River told ABC21 a statement will be released in the near future.
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