At his current rate, the former CEO of 5R Processors will fully pay off his $2 million in court-ordered e-scrap abandonment restitution in roughly 1,200 years. Knowing that, Wisconsin lawmakers just approved allocating another $2 million in public funds to clean up the mess.
Since E-Scrap News last reported in March 2021 on Wisconsin’s efforts to clean up the e-scrap messes, multiple former 5R sites have been remediated, yielding new details about the myriad hazardous materials that were stored there.
Additionally, the overall estimated cost to taxpayers has increased.
Based in Ladysmith, Wis., 5R had multiple locations in Wisconsin and a facility in Tennessee. Federal prosecutors say the company stockpiled millions of pounds of CRT materials and other e-scrap, concealed those stockpiles and committed tax crimes.
Two former company leaders have served time in prison, and a former CEO is still locked up while he appeals his 33-month sentence.
Meanwhile, the cleanups are progressing. Veolia ES Technical Solutions is currently working under a statewide hazardous waste contract to clean up the sites. In previously completed projects, Veolia found a mix of materials, including CRT glass, toner cartridges, lamps, herbicides, lead-acid batteries and more.
Not all of the material could be recycled, but “we did try to recycle as much as we could,” Natasha Gwidt, field operations director for the Waste and Materials Management Program at the Wisconsin Department of Natural Resources (DNR), said in an interview with E-Scrap News.
Dilapidated conditions drive costs
Veolia, which has a four-year statewide hazardous waste service contract with the state of Wisconsin, began cleaning up sites in Rusk County just after the start of the year and finished a couple of months ago, Gwidt said.
The completed sites included one in the village of Glen Flora and three in the city of Ladysmith, with the combined cleanup cost totalling about $800,000, she said. All told, Veolia cleaned up over 800,000 pounds of CRT glass (not including several other drums full of CRT glass), over 124,000 pounds of mixed electronics, and various other materials containing hazardous substances, such as lamps, herbicides, equipment with refrigerants and more.
Much of the CRT glass was recycled by URT in Janesville, Wis., state records show. Veolia sent other materials to other downstream processors, although it brought various end-of-life electronics to its own Veolia e-scrap facility in Port Washington, Wis. for recycling.
Gwidt noted that the condition of the sites helped drive up the costs. For example, when crews went to move semi-truck trailers full of material so they could access them, trailers literally fell apart. Additionally, a warehouse loading dock had to be worked on just so the crews could safely get a forklift in and out.
Other work is ongoing. Gwidt said Veolia is under a second contract to clean up a warehouse and trailers on a property in Catawba, a village in Price County, which is just east of Rusk County. That project began June 12 and will take about four months, she said.
The Catawba site, where 5R was doing some processing, has material that is tightly packed and stacked. As a result, officials won’t know exactly what and how much is there until the project progresses, she said.
The sites in Rusk and Price counties are only eligible for the state funding because they’re now publicly owned. Price County just foreclosed and took possession of the Catawba property in March, Gwidt said. As a result, the state couldn’t execute the cleanup contract with Veolia until after the foreclosure, she noted.
The condition of the Catawba site, which has a leaking roof, wet material and damaged gaylords that aren’t fit for transport, will bring additional cleanup costs, she said.
Finally, 5R still owns a site in West Bend, which is in Washington County, in the Milwaukee area. Because it’s still owned by 5R, it’s not eligible for state-appropriated cleanup dollars, Gwidt said, adding that she doesn’t know the status of any efforts by local governments to assume ownership of the property.
That location is large and will cost between $500,000 and $1 million to clean up, Gwidt estimated.
A little restitution money comes in
Former 5R executives have paid some money to help fund the projects, but the bulk of the costs will fall on taxpayers. That’s in contrast to 5R’s former Tennessee facility, where the private landlord ultimately paid $1.1 million to clean up the materials.
Kevin Shibilski, former CEO of the company, paid $100,000 in restitution to the DNR, Gwidt noted. Shibilski, 62, is currently at a minimum security prison camp in Duluth, Minn. with a release date of July 18, 2025 (he is appealing his 33-month sentence).
Former 5R President James Moss, 64, served time in prison and was released in September 2022. He was also ordered to pay nearly $1.96 million in restitution. Gwidt noted that he has been making monthly payments of about $127 each. She calculated that at that rate, it would take him over 1,200 years to finish paying off restitution.
As a result of the relatively limited money coming in via restitution, state lawmakers have decided to fund the cleanup. In 2022, the legislature unanimously passed a bill providing DNR with $2.5 million to clean up the 5R sites by June 30, 2023. Of that, the DNR has about $1.45 million left, enough to finish the Price County site but possibly not enough for the Washington County one, Gwidt said.
As part of the 2023-25 biennial budget, which was signed by Gov. Tony Evers on July 5, lawmakers gave the DNR another $2 million. That means DNR now has a total of $4.50 million to spend on all 5R sites (that includes the $1 million it has already spent). And the bill extended DNR’s deadline for spending the money by a year.
Shibilski, who blames his former 5R business partners for the company’s wrongdoing and is appealing his prison sentence, actually has numerous ties to the state government that’s now funding the cleanup of the company he helped run. He’s a former Democratic state senator, and he was briefly the state’s tourism secretary under a previous governor.
Additionally, during sentencing in federal court, Shibilski submitted letters attesting to his character from former Gov. Tommy Thompson (also former U.S. Secretary of Health and Human Services) and from Cathy Stepp, who was secretary of the Wisconsin DNR, which is now leading the cleanup project, the Wisconsin State Journal newspaper reported.
The newspaper noted that Thompson’s letter commended his work on education funding and environmental preservation.
