Each year, the Salvation Army Princes St Family Store pays about $5000 in landfill fees to get rid of unsaleable clothing, furniture and whiteware.
Major Glenn Anderson said many donated goods were "at the very poor end" and he believed charitable organisations were increasingly having to deal with disposing of unwanted goods.
Up to four trips to the landfill were made each week, as about 35% of all goods donated had to be disposed of.
Last month, 26 trips were made to the landfill, along with regular clearances of a skip on site.
Broken furniture, tatty clothes and filthy bedding were common sights in the sorting room.
Unwanted gas cylinders and computer monitors were also a concern, as they cost $10 each to take to the landfill.
He predicted the store would end up paying up to $8000 this year to dispose of junk. The profit from two of an average month's 22 trading days went on paying to dump rubbish.
"It's an ongoing catch 22 situation because we need the donations to turn into dollars which we can put into our community programmes, so, in a sense, we don't want to curtail them and are grateful for them."
Maj Anderson believed the problem had arisen out of many people's inability to take things to landfill or transfer stations.
"It is probably reflective of the fact that landfill charges have increased and we seem to be surrounded by people who are struggling economically and, particularly also, by students getting rid of stuff."
Red Cross Otago area manager Karen Clements said there was "a lot of inappropriate stuff dumped here that really should be taken to the tip".
While the majority of donated goods were of top quality, 30%-40% were unusable.
"There are a certain few that do use charitable organisations as a dumping ground," she said.
Significant time was spent sorting the quality from the scrap, and money paid to dispose of it was "high".
Good-quality clothing was required in order to fund programmes and aid work and it was "frustrating" when people did not think about what they were actually donating.
"I think some people are genuine. They think that people will buy it ... but I think there are also some people who are rather lazy and they think it's a convenient place to dump their rubbish."
Habitat for Humanity Restore manager Sarah Macandrew said the store's situation was "not as bad as it used to be".
About 10% of all donations had to be dumped and she believed people's inability to afford to dispose of it themselves, or lack of appropriate recycling options, were to blame.
"The city is not geared up for recycling. We are woefully behind; we are still putting it in the ground."
If the Dunedin City Council offered a regular inorganic waste pick-up, fewer unsaleable items would be dumped at charity stores, she said.
Council solid waste manager Ian Featherston said a regular inorganic waste pick-up had been investigated, but had been deemed too expensive to include in the rates.
However, he believed there was "no excuse" for illegally dumping inorganic materials and failure to dispose of them in an appropriate manner was "just general laziness".
