Dive Brief:

• Allied Waste Services and Rio Grande City, TX are in the midst of a legal battle, which began with Allied suing the city for terminating its eight-year contract and instead signing with Grande Garbage Collection Company. Court filings show that Grande Garbage is owned by the mayor’s campaign treasurer and largest campaign donor, Pat Hernandez, as reported in Valley Central.
• The city countersued, stating a 2014 internal audit revealed that Allied "fraudulently billed more than $150,000 for undelivered services."
• Rio Grande City now reviews garbage collection records every three to six months to avoid discrepancies.

Dive Insight:

This is not Allied Waste’s first lawsuit in the recent months, and legal filings over contract disputes involving competitors is not uncommon in this niche either.

The City of Rio Grande holds firm that the issue revolves around the money still owed to it. "Until the city has accounted for every tax dollar that this company billed when they should not have ...  we're gonna proceed to trial," said the municipality’s attorney, Jackie Salinas.

However resident Angel Ramirez said the residents are the ones who are getting hurt through the dispute. "If it does get ugly and it ends up suing for a lot of money, eventually we're gonna have to pay it back in taxes. As it is with us and taxes, right now, it's bad as it is," Ramirez said.

Allied is unable to comment during the duration of the legal process according to the company’s attorney, Gilberto Hinojosa.