Cities Are Buying Into Benefits of Recycling : Local governments, most affected by bulging landfills, are creating new markets for used paper.

Americans may be getting too good at recycling paper. Across the country, people are tossing used paper into recycling bins faster than it is being processed and put back on the shelves as new paper products. The price of used paper has fallen and the glut has forced some cities to bury recycled paper in landfills--the very thing recycling aims to avoid.

But not for long. Demand for recycled paper is growing rapidly, led in part by city, county and state governments. They are working to create markets by buying recycled paper in increasing quantities for use in forms, letterheads and envelopes and as paper for copying machines--and are reaching beyond their own purchasing departments to persuade businesses to buy it, too.

Why are local governments racing to create new markets? Mainly because paper is the largest single component of U.S. landfills--42% by weight. And the cost of using landfills is shooting up quickly as their number dwindles.

In New Jersey, for example, the cost of dumping a ton of garbage has gone from $5 a ton 10 years ago to more than $50 a ton today, according to the New Jersey Department of Environmental Protection and Energy. Some municipalities are paying well over $100 a ton. “The shock has been unbelievable,” says one department official.

Although the crunch is worst on the population-dense East Coast, landfills are filling up all across the country. The Environmental Protection Agency estimates that by the year 2003, there will be only 1,500 landfills left in America, down from some 4,500 today.

In the West, the cost of dumping averages $25 a ton, but cities face the same problems. All but three of Los Angeles County’s eight major landfills could close by 1995, according to Grace Chan, supervisor of planning for the country’s solid waste management department. “We critically need more landfill capacity,” she says.

Increasingly, cities and counties are trying to create new markets for recycled paper.

Three years ago this month, the U.S. Council of Mayors national office paper recycling project issued an Earth Day challenge to mayors nationwide to begin buying recycled paper. Before the challenge, only 37 cities around the country used such paper, project director Brian Day said. Now, the number has increased to more than 300.

State government and many federal agencies are also buying recycled paper. All 50 states have officially expressed a preference for it, and 37 have outlined purchasing policies.

It is cities and counties, however, that feel the pressure of the landfill crunch most directly, and they are going the furthest to encourage the use of recycled paper. Newark, N.J., not only uses recycled paper--about $380,000 worth last year--but requires companies doing business with it to use it, too.

“If you’re going to do business with us,” says Mayor Sharpe James, “you’ve got to be part of the solution, not part of the problem. And the solution to the landfill problem lies in creating markets for recycled materials. We’ve got to get this stuff out of the waste stream.”

San Jose is working on a similar policy. “We’ll be requiring our contractors to use recycled paper for any report longer than 10 pages,” says Deborah Greathouse of the city’s Office of Environmental Management. “That means legal firms, consultants, landscape architecture firms working with the Parks Department--we have thousands of firms filling contracts let by the city.”

The growing sales of recycled paper have not gone unnoticed by the paper industry. “Our customers are demanding recycled paper,” says Karl Roberts, manager of strategic planning for Boise, Ida.-based Boise Cascade. “It also happens to make financial sense for us.”

Boise Cascade was going to close its mill in Vancouver, Wash., in 1990, according to Andrew Drysdale, Boise’s associate director of corporate communications. “We converted it to producing recycled paper instead of closing it,” he says. “Now it’s running at maximum capacity and we’re selling all the recycled paper it can produce.”