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Private carters ordered to refund patrons $8.5M.

Following a recent court victory for New York City's Department of Consumer Affairs, commercial carting companies owe their customers $8.5 million in refunds.

An Appellate Court judge upheld the ability of the department to lower carting rates for the first time in the city's history. Commissioner Mark Green has ordered that rates go down on Aug. 1. This is the first time rates will drop since the department started setting maximum rates in 1957.

The new rate ceiling are:

*$13.60 per cubic yard of non-compacted waste

*$45.60 per cubic yard of compacted waste

*$ 3.70 per 55 gallons of waste

*$ 2.02 per 30 gallons of waste

*$ 1.48 per 22 gallons of waste

The 421 licensed carters -- which pick up 40 percent of the city's garbage -- will have 60 days to pay each customer the difference between the new lower rate and the rate the customer was charged between May 6, 1991, and July 31, 1991. Payment can be made either by crediting the customer's account or by refunding the amount to the company and its successor in interest. All crediting/refunding must be completed by Sept. 30, 1991.

After analysis of the carters' costs and public hearings, Commissioner Green officially reduced the rates last March 7.5 percent -- a $13.60 per cubic yard maximum from $14.70. Soon after the Trade Waste Association filed suit in hopes of abolishing the lower rate scheduled to go into effect on May 6, 1991. State Supreme Court Justice Phyllis Gangel-Jacob rejected the carters' legal arguments and dismissed the lawsuit on July 17. The Appellate Division then refused to issue a new injunction pending appeal of the lower court decision, thus requiring the repayment.

Victor Kovner, Corporation Counsel for the city, said the decision gives "a clear judicial ruling" that the commissioners role is not limited to granting increases to the carters. The law also requires, he said, that rates be lowered when the carters' costs go down.
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Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Real Estate Weekly
Date:Aug 7, 1991
Words:330
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