A proposal to change how private trash companies collect refuse from Los Angeles businesses and apartment buildings could generate as much as $30 million a year in new revenue, according to a report from the city’s top budget official.
A study from City Administrative Officer Miguel Santana recommends moving the city to a non-exclusive franchise model. That means qualified haulers would be required to obtain a franchise agreement from the city. Earlier this year, the Bureau of Sanitation recommended moving to an exclusive franchise where the city's six trash zones would be subdivided into 11 collection areas. Each collection area would have one primary hauler.
“A non-exclusive franchise preserves an open, competitive marketplace which is the most significant factor in maintaining price controls, and where the primary business model concerns business-to-business relationships, not business-to-city relationships,” Santana wrote in his report.
The non-exclusive model is supported by Angelenos for a Clean Environment—a coalition that includes the L.A. Area Chamber of Commerce, the Apartment Association of Greater Los Angeles and the L.A. County Disposal Association.
Under a non-exclusive setup, waste haulers would pay an upfront fee to establish a franchise agreement with the city. Those fees could total $20 million to $30 million a year, according to the report.
That model, however, is opposed by the Los Angeles Alliance for a New Economy, which favors an exclusive arrangement. Greg Good with LAANE’s Don’t Waste L.A. Project believes the CAO is proposing a timeline that is too aggressive.
“It is an effort to show the sparkle of money and without really considering the implications for ratepayers and, frankly, the likelihood of getting anything done in a year in this city,” Good said. “An exclusive franchise is the best way to reach environmental goals. Just saying it’s not is not enough. We need that analysis.”
Currently, there are 140 private haulers that collect trash from the city’s multifamily and commercial buildings. Those haulers are required to obtain a permit from the city. A franchise system would allow L.A. city officials to put environmental and financial standards in place
Members of the business community believe both models would allow the city to institute more efficient truck routes and recycling requirements.
“We are willing to accept every aspect of their proposal except for the exclusivity—we want competition in the city," said Stuart Waldman, president and CEO of the Valley Industry and Commerce Association. "It is completely acceptable, the green standards that they are looking for.”
The Energy and Environment Committee will join the Ad Hoc Committee on Waste Reduction and Recycling at City Hall on Wednesday to discuss the recommendations.