FORT WAYNE, Indiana (WANE) – Mains heated at the Fort Wayne city council meeting on Tuesday on the future of Red River Waste Solutions after the company filed for Chapter 11 bankruptcy last week.
The exchange began when city councilor Sharon Tucker (6th arrondissement) asked Matt Gratz, director of the city’s solid waste department, about what he knew about Red Rivers’ finances.
After joking, City Councilor Glynn Hines (At-Large) stepped in and told Gratz to change the way he addresses council.
“He (Gratz) told the board that he did not penalize them completely when they failed, it is because it would hurt them negatively and financially because they were not in good financial condition,” said Hines. “So when he yelled at Councilor Tucker and denied ever knowing about any issues with their finances, it wasn’t factual.”
Prior to the debate, it was learned that Red River officials had failed to respond to council’s request to appear before council. Lawyers for the city, who spoke to officials from the Red River earlier today, told council they had a “scheduling conflict.”
For over an hour, the council spoke with two attorneys who are the town’s legal advisers about what might happen next with the garbage collector. Last week, Red River filed for Chapter 11 bankruptcy in Texas.
“It gives them the privileges that are the opportunity to present a plan for reorganization,” said attorney Timothy Haffner. âThey (Red River) are committed to continuing the service, they want to continue serving, whether it is in the form of a corporate reorganization or the involvement of a partner that we do not yet know about. ‘they don’t know yet but waiting to see how this plan unfolds.
During the meeting, Haffner and his partner Jay Jaffe explained to the board what Chapter 11 bankruptcy is and that Red River has three options moving forward:
- Company reorganization
- Sell ââthe business
- Hybrid of one and two
According to lawyers, if a third party buys Red River, the city should follow the third party. This does not mean the city cannot seek another contract until Red River rejects the current contract. Fort Wayne could ask the court (where Red River filed for Chapter 11 bankruptcy) to dismiss the contract.
When Red River filed for bankruptcy, the court had the right to come up with a plan for the first 120 days after filing and no one else can come up with a plan. Jaffe says the Red River lawyer has informed them that they believe the bankruptcy process will take at least six months.
In the meantime, council has been informed that garbage collection will continue as follows and that it will begin to look for other companies to take over the city’s contract in the event that Red River goes bankrupt.
The council also wishes to remind residents to call all missed collections by dialing 311.