By Andrew Hawkins
October 3, 2013
An effort to transform the city's commercial waste industry is drawing criticism from trash collectors, who argue that a proposed franchise system would push out smaller businesses and raise prices for customers.
New York's restaurants, businesses and office buildings generate 3.2 million tons of solid waste every year, and bury or burn more than 2 million tons of it in landfills and incinerators, according to a report by the Alliance for a Greater New York. Over 90% of commercial waste is recyclable or compostable, but the city estimates that only 40% is actually recycled.
To improve environmental and labor standards, the group proposes a commercial-carting franchise system with competitive bidding, similar to those in Los Angeles and Seattle.
"The commercial waste industry is ripe for an overhaul," said Eddie Bautista, executive director of the NYC Environmental Justice Alliance, which has endorsed the report.
A franchise system would involve selecting waste haulers through a bidding process to collect garbage in set zones across the city. Currently, businesses contract individually with carting companies, so it is not uncommon for a series of trucks from different haulers to service the same block night after night.
"Franchise awardees would be required to meet environmental standards that increase recycling rates, reduce truck emissions, and more equitably distribute waste handling across the city; to meet labor standards that improve the safety and quality of jobs; and to ensure the new recycling jobs that are created are good jobs," the report states. "In return, franchisees would benefit from a steady, efficiently located base of customers. The franchise system would ensure accountability through reporting requirements and increased City oversight."
But trash collectors say the idea stinks.
"Anything like that would clearly raise the prices," said Ron Bergamini, CEO of Action Environmental Services, which includes the major city waste hauler Action Carting. "You'll put the smaller companies out of business."
Mr. Bergamini said the likelihood of the city imposing a franchise system, which argues would stifle competition, was low. Only financially stable trash haulers would benefit from such a system, he said.
"It's a lot bigger lift then they're letting on," Mr. Bergamini said. "I'd argue the regulatory environment is already stifling."
David Biderman, general counsel and vice president of the National Solid Waste Management Association, an industry lobbying arm, agreed, saying his group had "serious concerns" about the proposal.
"We intend to study it," he said, "but we strenuously disagree that imposing waste franchises and limiting customer choices is an effective way to accomplish the objectives of increased recycling and a cleaner environment."
Mayor Michael Bloomberg enacted the citywide Solid Waste Management Plan in 2006, which aimed to correct inequities in the city's trash policies. The plan called for new marine waste transfer stations to ease the burden on low-income neighborhoods and shift much of the trash removal to barges and trains to reduce truck traffic.
Environmentalists and labor groups applauded Mr. Bloomberg's plan, but they say that the ALIGN proposal will be the next big step in reforming the city's waste policies.
"This is going to be a big lift," Mr. Bautista said, acknowledging the criticism from trash haulers about the proposal's viability. "This is the next big frontier…it's just a range of wasted opportunities—no pun intended—that we need to start grappling with."
To read the full article, visit Crain's New York Business