Whenever Bill and Elaine Mikelionis return from a weekend at their summer home in Huntingdon County, their trunk is filled with luggage - and recycling.

Why leave all those empty bottles, cans and newspapers in central Pennsylvania when they can be deposited curbside in Port Richmond?

"She has been a big supporter of recycling for at least 10 years now," Bill said of Elaine.

Call them role models for the environment and, with the city facing insolvency, fiscal responsibility. While the city still has a long way to go before it catches up to German cities in terms of the amount of recyclables it diverts from its waste stream, it has made great strides in the last year.

The recession may have knocked the stuffing out of the recyclables market for much of the year, but prices for paper, tin, and aluminum are recovering. And, regardless of the market, every bottle, can, or newspaper diverted represents critical savings in landfill tipping fees.

Soon, Philadelphians might start receiving redeemable bonus points, akin to frequent flier miles, for the bottles, cans, and newspapers they toss into the blue hopper.

"This is something we are doing for our children," Bill Mikelionis, 67, said of his commitment to recycling while sitting in the garage where he ran an auto shop before retiring.

Mikelionis' neighborhood achieved a diversion rate of 12.6 percent in June, according to the Philadelphia Department of Streets, slightly above the citywide rate of 12.4 percent.

The diversion rate is the percentage of waste materials reused or recycled instead of being dumped in landfills or incinerated.

Thanks to the efforts of the Mikelionises and other Philadelphians, the city set a record for residential recycling in the fiscal year that ended June 30: 75,060 tons, a 46 percent increase.

The diversion rate jumped from 8.4 percent in June 2008 to 12.4 percent, fueled by the single stream system - residents can dump all their recyclables into the same blue bin, on the weekly trash day. The next goal is to get above 20 percent at the end of the current fiscal year in June 2010.

By recycling, Philadelphia residents saved the city $4.8 million last year in landfill costs. Each percentage-point increase in the diversion rate means a budget savings of $500,000, said Carlton Williams, deputy streets commissioner.

Combining residential and commercial recycling, the city's overall diversion rate is about 50 percent. This leaves Philadelphia a distant speck behind Germany, where the diversion rate can climb as high as 99 percent, said Paul Gilman of Covanta Energy, which operates energy-from-waste facilities in the United States.

Philadelphia's goal is a total diversion rate of 70 percent in 2015.

Brian Janjanin, 31, who lives a block north of Mikelionis' former garage, started to do more recycling after the collection system was simplified.

"To put everything in a blue container is not a big deal for me," he said. "If I had to separate the glass, bottles, paper and all, I probably wouldn't do it."

He said the city needs to show people the benefits of recycling, both environmental and economic.

"They should give us concrete information - how many trees the city helped to save, things like this."

After a city truck collects Janjanin's recycling at curbside every Friday morning, it takes it to Blue Mountain Recycling on the 2900 block of Ellsworth Street in South Philadelphia, a component of Casella Waste Systems Inc. of Rutland, Vt.

Blue Mountain has a contract with the city to separate and resell the recycled material. Machines separate glass, paper, cardboard and different plastics, using optical and magnetic devices. The place resembles an assembly line that produces bails of material that are shipped for clients of another Casella component, FCR Recycling.

Bob Anderson, business development director for FCR Recycling, said aluminum is turned back into cans, PET bottles become carpet fibers, and tin cans can be made into bicycle parts.

Unfortunately, Philadelphia's improved recycling performance has happened at the same time the market for recycled commodities has gone down dramatically.

"A lot of the plastics we get are converted into carpet fibers," Anderson said. "The residential housing market is in a slump, so there is less carpet being consumed and its price falls. It's all a systemic issue, one component impacts another."

China and India, which manufacture a lot of the products sold in the United States, are also big consumers of American recyclable material. Now, they don't need to buy as much as before, said Robert Bylone, executive director of the Pennsylvania Recycling Market Center, because consumer demand is down in the United States.

The city also looks for recycling to help its budget.

Until December, the city was saving $64 per ton in landfill costs - and earning $44.03 per ton on recyclables.

By January, the city was paying $32.79 to recycle, largely due to market changes. That's still half the cost of landfilling.

And, with the economy apparently recovering, the city now is paying $14.50 per ton to have the recyclables removed.

Regardless of the market, recycling remains a money-saver for the city. That is why the Streets Department is negotiating with RecycleBank, a Philadelphia nonprofit, to start a citywide recycling rewards program by the end of the year.

The system will give residents points based on the weight of their recyclables. Those points can then be converted into discounts at local businesses and other partners.

Between January 2005 and August 2008, RecycleBank sponsored a pilot project involving 2,500 households in Chestnut Hill and West Oak Lane, neighborhoods that now have diversion rates above 20 percent, the highest in the city.

Neither Williams nor Michael D'Angelo, regional manager of RecycleBank, could say when the program would start or how long it would take to go citywide.

"We're working closely with the city, and we are prepared to move forward when the city is able to, after the budget issues get resolved," D'Angelo said.

In Cherry Hill, RecycleBank has operated a reward system since 2007. One of the early participants was Lea Arberly, whose RecycleBank account states that she has saved 11.24 trees and 750.68 gallons of oil since October 2007. Her home, like 24,000 others in Cherry Hill, has a blue bin equipped with a Radio Frequency Identification chip. When a truck collects the recyclables, it records the weight of the recyclables put at curbside.

Arberly will donate the points to her daughter's school to get discounts on office supplies and sporting goods. It was Ayelet, her 13-year-old daughter, who got the family into recycling eight years ago, when she tied herself to a tree in the family's backyard to save it from making room for a pool - which, she proudly notes, never got put in.

"My brother is still angry, but I saved [the trees'] lives," she said.

The program went town-wide on the Fourth of July, 2008. Now, the residential diversion rate in Cherry Hill is over 50 percent, said Dan Keashen, the town's public information officer.

Nabil Nasr, director of the National Center for Remanufacturing and Resource Recovery at Rochester Institute of Technology, thinks that incentives are "far more powerful than punishment." But a rewards program must increase the amount and type of materials recycled.

"If it's just rewarding people for what they would be doing anyway," he said, "it doesn't make much difference."

What to Recycle

Metal: Tin and aluminum cans, empty aerosol cans, empty paint cans.

Glass: Jars and bottles.

Mixed paper: Newspapers, magazines, mail (junk and personal), phone books, food boxes (remove the plastic liner), computer paper, fliers, wrapping paper (no foil or plastic wrap), soda and beer cartons (no food-soiled paper).

Plastic containers: The city takes only two kinds of plastics, No. 1 (mostly soda and water bottles) and No. 2 (mostly detergent and fabric-softener bottles). To find out if a container is acceptable, look for a recycling symbol with 1 or 2 imprinted on or near the bottom.

Cardboard: Empty and flattened.

The Philadelphia Recycling Hotline is 215-685-RECYCLE (7329).

SOURCE: Department of Streets, City of Philadelphia

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Contact staff writer Rodrigo Muzell at 215-854-5016 or rmuzell@phillynews.com.