Rizzo expands empire after pumping cash into campaigns

Robert Snell, and Michael Gerstein
The Detroit News

Detroit — Two political action committees linked to a garbage hauler at the center of an FBI corruption investigation and its former CEO have pumped more than $174,000 into political campaign coffers in communities that have awarded the firm multimillion dollar contracts, public records show.

The contributions since 2011 illustrate the split personality of Sterling Heights-based Rizzo Environmental Services. Interviews, campaign finance and federal court records show Rizzo’s political action committee funneled legal campaign funds to dozens of politicians while a top executive allegedly bribed elected officials in exchange for votes and favorable treatment.

“The problem here is that what is available to the public is what was ‘on the table,’ ” said Craig Mauger, executive director of the Michigan Campaign Finance Network. “The authorities seem to be focusing on what was ‘under the table,’ which the public has no idea of what’s going on.”

Campaign contributions from Rizzo’s political action committee, a related group and ex-CEO Chuck Rizzo Jr. were given directly to or benefited dozens of political candidates in 23 Metro Detroit communities. Those contributions targeted races in communities that have hired Rizzo to haul garbage in recent years and awarded the firm no-bid, multi-year contract extensions.

The groups also gave an additional $94,550 to candidates running for countywide posts in Wayne, Oakland and Macomb counties.

Metro Detroit’s most prominent politicians are on the list – including Detroit Mayor Mike Duggan, U.S. Rep. Candice Miller, Wayne County Executive Warren Evans, Oakland County Executive L. Brooks Patterson, and Macomb County Executive Mark Hackel. But relatively obscure, local politicians received some of the largest contributions, campaign finance records show.

Interactive map: Rizzo's reach in Metro Detroit

The money coincided with a spike in the number of communities hiring Rizzo, state and local records show. In 2013, the firm served 22 area communities but three years later, after forming a political action committee that has grown into one of the state’s largest, 54 communities have hired Rizzo.

The contributions, in almost all cases, came before Rizzo was acquired Oct. 1 by Toronto-based GFL Environmental Inc. CEO Chuck Rizzo Jr. resigned from his namesake company late last month amid a widening federal bribery investigation.

GFL says the campaign contributions were an essential business expense, especially since its rival Waste Management also poured thousands into area campaign coffers.

“We earned contracts in additional communities by offering the highest level of service at the best price,” Joseph Munem, GFL’s director of government affairs and public relations, said in a statement. “We support the communities we serve in many ways, from funding charities to sponsoring little league teams to buying tickets to events put on by local elected officials.”

GFL’s top executive said the firm is reassessing its political activity in light of three Macomb County politicians being charged with corruption. The number of politicians facing federal charges is expected to grow as the FBI investigation continues across Metro Detroit.

“(GFL) will be exploring the best ways to participate in a system where our competitors remain extremely active,” company founder/CEO Patrick Dovigi said in a statement.

New PAC formed

The trash hauler’s PAC was established in 2013 and bankrolled primarily by Chuck Rizzo Jr., records show.

The PAC has given more than $310,000 to politicians and special-interest groups in recent years. That figure includes campaign contributions to candidates for statewide races, county posts and in communities where Rizzo does not have trash-hauling contracts.

Chuck Rizzo Jr. has given $7,900 in personal contributions to candidates for local offices in Macomb County since 2011, according to campaign finance records.

Last year, the Rizzo PAC was particularly active in Sterling Heights, the state’s fourth-largest city and Rizzo’s home base.

In 2015, the mayor and six incumbent council members were seeking re-election as the city prepared to seek bids to possibly switch from garbage hauler Waste Management.

Campaign contributions flowed into the Sterling Heights races from Rizzo and a new group.

In January 2015, a new PAC called the Mitten Leadership Fund was established. Its treasurer is Rochester Hills lawyer Jeffrey Hengeveld; its purpose and organizer are unclear.

The Rizzo PAC was one of the Mitten fund’s largest contributors last year, giving $9,000, or 13.4 percent of all money raised by the fund, records show.

Mauger tracks PACs annually — both committees ranked among the largest in the state last year — and said the Mitten fund is unique.

“I have no idea who’s behind it,” Mauger said. “I called and asked who is behind this PAC. They wouldn’t tell me. I found that very odd — extremely odd. It would seem whoever is orchestrating this has gone to some lengths to hide who the fund belongs to.”

Hengeveld, the Mitten fund’s treasurer, did not return a message seeking comment. GFL would not talk publicly about any link between Rizzo and the Mitten fund.

In August 2015, the Mitten fund started spending money in Sterling Heights. Mayor Michael Taylor received $20,000 that month from the Mitten fund, campaign finance records show. By December, Sterling Heights candidates had received $61,500 from the Mitten Fund.

Between the Mitten fund and Rizzo PAC last year, Sterling Heights candidates received more than $71,000.

Since 2013, Taylor’s campaigns have received $26,300, or almost four times as much as Detroit’s mayor has received in the last three years.

A company official said the Rizzo PAC’s contributions in Sterling Heights were in line with those from Waste Management, its chief rival.

Waste Management Employees Better Government Fund Of Michigan gave $10,000 to the Mitten fund last year and $5,850 to the Sterling Heights candidates, records show.

The Sterling Heights mayor and six incumbents won last year’s election.

In April, five months after the 2015 election, Sterling Heights switched from Waste Management and voted unanimously to give Rizzo an eight-year contract worth about $34.8 million.

Rizzo offered the better deal, according to Taylor and City Council meeting minutes.

The city will save about $800,000 because of a 2 percent annual reduction on all services the company offered to the city. Meanwhile, Waste Management would have charged about $247,890 more a year, according to the minutes.

“The bottom line here is that Rizzo provided the best proposal and that’s the reason that they got the contract,” Taylor said. “My vote had nothing to do with campaign contributions. I never ask them why they’re contributing money ... I never ask them what they need me to do to contribute to them.”

Taylor said he met with representatives from both Waste Management and Rizzo because they were the two companies under consideration when the city was looking for a new garbage contract.

“I never discussed with Rizzo anything that they had to do in order to secure the bid,” Taylor said. “I never discussed with Rizzo or with Waste Management what the others’ prices would be. My whole goal all along was to get the best possible price for residents of Sterling Heights and the best possible service. That was it.”

Councilwoman Deanna Koski said her vote was not influenced by the contributions.

“I didn’t know that I got $6,000 from them … and that had absolutely nothing to do with my vote,” Koski said.

“Thank you very much,” she added before hanging up the telephone.

One of the top Rizzo PAC recipients this year was Miller, who won an expensive race this month for Macomb County Public Works commissioner.

Miller received $12,000 from the Rizzo PAC in September but returned the money amid the FBI investigation “because with everything that’s going on she felt it was the appropriate thing to do,” spokesman Jamie Roe said.

“She knew nothing of anything untoward or inappropriate that was going on, which is why she gave it back,” Roe said. “What local communities do with their garbage contracts is the business of local communities. She knew absolutely nothing of it. If she had known, she would have never taken the money in the first place.”

Livonia contributions

The influx of Rizzo cash in the weeks and months surrounding a trash-hauling contract were repeated in Livonia last year.

On June 8, the Rizzo PAC gave $1,000 to Councilman Brian Meakin’s mayoral campaign plus $1,500 in September. The spending was part of a broader pattern last year that saw the Rizzo PAC make a total of $11,668 in direct and indirect contributions benefiting six candidates.

The spending surpassed the Rizzo PAC’s prior involvement in Livonia campaigns. In 2013, for example, four candidate committees split $700.

The 2015 campaign contributions coincided with debate over a new garbage contract.

In September 2015, Livonia City Council voted to give Rizzo a new eight-year garbage contract. The vote was approved by four members — including Meakin and Susan Nash.

Between June and September, Meakin’s campaign committee received $2,500 in contributions from the Rizzo PAC. The “Friends of Susan Nash” committee got $500, campaign finance records show.

Council members Lynda Scheel, Brandon Kritzman and president Maureen Miller Brosnan voted against the new contract for Rizzo, which was $1.65 million lower than Waste Management, according to media reports at the time. The savings led council member John Pastor to support the switch, according to the Detroit Free Press.

Meakin did not return a phone call from The News seeking comment about the Rizzo contributions.

Rizzo’s PAC wasn’t done spending in Livonia after winning the contract.

The month after Rizzo won the contract, Nash’s committee got $1,000 and Pastor’s received $500 from the trash hauler’s PAC.

The PAC also paid $4,168 to an Ohio campaign technology company that specializes in political robo calls – an expense associated with Meakin’s campaign, state records show.

Less than a month after paying for the robo calls, Livonia residents elected a new mayor.

Meakin lost.


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