New era for L.A.'s commercial waste?

Friday, September 28, 2012
George Watland

Updated Nov. 15, 2012: The L.A. City Council approved of the plan in an 11-3 vote in favor of carving the city into 11 exclusive hauling franchise areas for waste pickup from commercial properties and large apartment buildings. Media reports say business interests and other opponents have vowed to fight the plan.

L.A.'s commercial trash hauling system needs an overhaul.

While the city currently picks up and sorts trash at residences and small apartment buildings, larger buildings contract with private trash haulers that fail to provide recycling and fail to keep rates down.

Enter a new plan set to come before the L.A. City Council this month in which the city would be divided into 11 zones -- each with an exclusive hauling company -- that will help the city better meet its environmental goals.

Critics say the plan would raise prices, but the Zero Waste Committee of the Sierra Club Angeles Chapter joined the Don’t Waste LA (DWLA) coalition to announce a new report that shows exclusive franchise agreements systems in L.A. County cities have protected commercial rate-payers and kept rates low, despite dramatic increases in industry costs.

Hillary Gordon, chair of the Zero Waste Committee, leads local Club activists collaborating with DWLA to call for the city of Los Angeles to implement exclusive franchise agreements for waste haulers operating in its commercial and multifamily waste and recycling sector. Over the past two years, activists have met with L.A. City Council members and Department of Sanitation officials and testified at City Hall hearings to advocate for franchise plan to help Los Angeles better meet its goals of waste diversion and recycling, clean air, job creation and fair rates for residents.  

Opponents of the plan, including the Los Angeles Area Chamber of Commerce, the Valley Industry and Commerce Association and other business lobbyists, have raised concerns about customer rate increases. But the report, “Stabilizing Customer Rates in Exclusive Franchise Waste and Recycling Systems: An Analysis of Commercial Rates & Cost Drivers in LA County,”  counters the claim with data from other local cities already using exclusive franchise agreements.

"We analyzed all available rate data from 34 exclusive franchise cities in L.A. County from 2002 to 2010, and the numbers are clear: Exclusive franchise systems keep customer rates stable, despite rising industry costs. In fact, eight cities, including Beverly Hills, saw their rates actually decrease,” said Lauren Ahkiam, policy analyst for Don’t Waste LA. "Rates remain stable for exclusive franchise customers simply because contracts lock rates in over time. Increases must be negotiated in the contract between the hauler and the City, and are typically tied to the rate of inflation.”

In contrast, an alternative proposal released two weeks ago by the Los Angeles City Administrative Officer, waste hauling companies and their lobbyists, called for immediate and dramatic increase in franchise fees without similar protections for ratepayers to whom costs will likely be passed on.

“The CAO’s plan would leave customers without size or leverage – our small businesses, small landlords and their tenants – vulnerable to substantial rate increases to pay for the haulers’ increasing costs,” said Greg Good, director of Don’t Waste LA. “We call it the Rates-Through-The-Roof Plan because customers could expect to see their rates increase immediately.”

Two small business owners spoke out against the alternative city proposal and expressed support for an exclusive franchise. Rocio Ramirez, owner of Mama’s Hot Tamales near MacArthur Park, made her voice heard. "After everything I’ve overcome to keep my doors open, the last thing I need is the kind of waste and recycling system that’s being proposed by the CAO and big waste companies, “ she stated. “They’re promising the city a lot of money from increased fees in order to get our elected leaders to support their plan. But those increased fees are going to be paid for by small businesses owners like me – and I for one simply cannot afford them.”  

The city, meanwhile, issued an HF&H Consulting report titled “City of Los Angeles Commercial Solid Waste Cost and Fee Analysis" that shows solid waste costs and rates in L.A. County cities are about the same in exclusive and non-exclusive systems. The DWLA report builds on the findings of HF&H by examining the rate impacts in those cities over time.  

The City Council is expected to take up the matter of waste hauler exclusive franchise agreements this month. Read the DWLA report and the HF&H Consulting report to learn more about the issue. To support the efforts of the Zero Waste Committee, contact Hillary Gordon or Chapter Conservation Program Coordinators Jennifer Robinson and George Watland.

Photo: Small business owner Rocio Ramirez speaks out in support of a plan to improve L.A.'s commercial waste hauling by embarking on exclusive franchise agreements.

Gina Palencar at LAANE contributed to this article and provided the photograph.

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