DAVIE, Fla. – Davie Mayor Judy Paul said she is comfortable with the decision her town made to allow a private, for-profit company to exclusively take over all clothing donation bins.
The town's decision forced the Salvation Army and Goodwill, both nonprofit organizations, to remove their clothing donation bins.
"I don't think the impact in one community would be detrimental," Paul said.
Davie entered into a four-year agreement with FLSC LLC. The private, for-profit company will in turn pay Davie $100,000 a year for exclusivity.
That money will go into the town's own endowment fund. The town plans on giving the money to charities of their choice.
"The fund has been going down and down and down and we were running out of money," Paul said.
The Salvation Army said Davie's move has cost them $250,000 in revenue after they had to remove four donation bins.
Paul told Local 10 News investigative reporter Jeff Weinsier she didn't know the Salvation Army was losing that much revenue.
But videotape of a Feb. 4 meeting showed the mayor and City Council was told about the financial hit.
"I believe it is a danger to charities," said Maj. Henry Hudson of the Salvation Army in Broward County.
Goodwill had to remove three donation trailers, including one that had been at 114th Avenue and State Road 84 for 25 years.
Representatives from Goodwill asked Davie leaders to allow donations trailer to stay.
Salvation Army said 60 percent of their income to run programs comes from clothing donations.
"I think the focus should be on how this program in Davie is helping Davie charities," Paul said about the town's endowment fund.
Many residents said they feel the town has created a monopoly and direct competition for the nonprofit organizations.
The Salvation Army provides housing, rehabilitation, work therapy and counseling to 100 people year-round at its Broward Boulevard facility in Fort Lauderdale. All the money to operate the facility comes from local donations. The Salvation Army also provides disaster services.
"If other towns do the same, then we may be having to pack up and close the doors," Hudson said.
Follow Jeff Weinsier on Twitter @jweinsier
Follow Local 10 News on Twitter @WPLGLocal10