Oakland reduces food compostable collection rates

By Ken McEntee

October 7, 2015

Following angry protests from restaurant owners in Oakland, the city has lowered its commercial compost collection rates to 30 percent below the cost of picking up trash through July 2016. After that, the organics collection rate will increase to 25 percent below the waste collection rate. (See related article.)

The move reversed a situation in which the city, in July, while declaring that it wants to keep organics out of landfills, set commercial organics collection rates higher than the rate for waste collection (see Composting News, July 2015).

The new rates were part of a new 10-year contract that gives Waste Management of Alameda County a monopoly on the commercial collection of trash and compostables in the city of Oakland. The new rates coincided with the city’s launch of “Oakland Recycles,” a new zero waste program of trash, compost and recycling services with a goal to divert all compostable and recyclable material away from landfills.

Independent restaurant owners uniting under the name the name Oakland Indie Alliance, trashed the arrangement, protesting in front of City Hall.

“We are shocked by the massive compost fee increases in the contract,” Gail Lillian, owner of Liba Falafel, said at the time. “Additionally, the composting fees are set higher than trash fees, serving as a deterrent for composting.”

Lillian said, her monthly charge for organics collection more than doubled, from $225 per month to $460 per month – an increase of almost $3,000 per year. Trash collection rates increased, she said, but not nearly as much as her composting bill.

Prior to a special City Council meeting to consider revising the rates, almost 40 restaurant owners sent a letter to council that said the proposal revisions were not good enough.

“We hope that you agree that the protracted and convoluted process of writing and approving the original contract will stand as an example of how not to write a city contract for many years to come,” the letter said. “We understand this is biggest contract Oakland has ever written, and that council and city staff spent many hundreds of hours and millions of dollars to write it. Much of this effort and money was clearly wasted. Instead of writing a contract that serves the citizens and businesses of Oakland – either by providing us services we needed, or by keeping rates sustainable for services we already had – council approved a contract which has been referred to as the ‘Rolls Royce’ of contracts, with vastly increased costs being borne primarily on the backs of restaurants and multi-tenant buildings through exorbitant rates. Many of us invested in Oakland during challenging times, and hope to benefit from its resurgence. Terrible deals like this pull the rug out from under us. Oakland's independent business community will wither like it did during the early 2000 dot-com boom if you continue to ignore our needs.”

The organics collection rate adjustment to 30 percent of the waste collection rate through July 1, 2016, and 25 percent of the trash rate thereafter, the restaurateurs said, because:

• Landfill and compost rates are still the highest in the region, by far.  
• Regional compost rates for most surrounding cities are at 50 percent of landfill rates.
• Twenty-five percent is far below the norm.“We need you to do more,” the letter said. 

 “Please take the time to make this contract right.”
 
The restaurateurs called for the removal of unnecessary services from the contract with Waste Management; the re-examination of the balance of rate adjustments between the various entity types; examining the disposition of the $28 million annual franchise fee paid to the city; and bringing commercial rates in line with others in the region.
The city, however, approved its proposed rate adjustment.

Under the new program, the city admitted, commercial composting service rates charged by Waste Management “upside down – higher, in most cases, than the comparable rates for trash service, creating a disincentive for businesses to compost.”

For example, the monthly rate for collecting a 20-gallon cart of trash once a week was initially set at $27.97. The rate for the same sized cart and frequency of collection for compostables was set at $33.84 per month. Weekly collection of a seven-yard trash bin was $968.10 per month, compared to $1,109.75 for compostables.

Oakland restaurants protest food waste collection hikes

(Originally published in Composting News, July 2015)

By Ken McEntee

July 20, 2015

The city of Oakland this month began its Zero Waste initiative to keep recyclable and compostable materials out of landfills. Local restaurant owners, meanwhile, were hit with a big surprise when they got their new trash bills, which took effect on July 1.

“We are shocked by the massive compost fee increases in the contract,” said Gail Lillian, owner of Liba Falafel. “Additionally, the composting fees are set higher than trash fees, serving as a deterrent for composting.”

For example, the monthly rate for collecting a 20-gallon cart of trash once a week is $27.97. The rate for the same sized cart and frequency of collection for compostables is $33.84 per month. Weekly collection of a seven-yard trash bin is $968.10 per month, compared to $1,109.75 for compostables.

As a result of a new 10-year contract with the city of Oakland that gives Waste Management of Alameda County a monopoly on the commercial collection of trash and compostables, Lillian said, her monthly charge for organics collection more than doubled, from $225 per month to $460 per month – an increase of almost $3,000 per year. Trash collection rates increased, she said, but not nearly as much as her composting bill.

In a letter to Waste Management and to Oakland Mayor Libby Schaaf, a group of local restaurant owners said that cost advantages of composting and recycling created strong incentives to reduce landfill use, leading to different choices when shopping for supplies and ingredients to reduce waste. It makes no sense, Lillian says, especially in light of the city’s Zero Waste initiative, to make restaurants may more to separate their compostables.

Following a protest by local restaurant owners – who have formed a new group called the Oakland Indie Alliance - City Council was considering a revised proposal that would reduce rates for organics collection to 90 percent of the trash rate. Lillian called it a short term fix.

Until the new waste contract went into effect, Waste Management controlled commercial trash collection, but companies were free to contract with other vendors for recycling and composting pickups, Lillian said. Lillian and some other restaurant owners hired Recology to take their food waste. The new contact gave Waste Management a monopoly on composting as well. The contract was approved last fall, ending a suit Waste Management filed against Oakland after the city earlier awarded an exclusive collection contract to another company.

“We expected to see a rate increase with the new contract, but we didn’t expect this,” she said.

On June 10, Lillian and about 24 other restaurant owners held a press conference in protest of the new rates on the steps of Oakland City Hall. Some brought their food waste containers with them.

“The restaurants, whom have been big supporters of composting for years, are getting massive increases in this new contract,” she said. “Some of us have seen our composting rates triple. One restaurant is getting an increase of $11,000 from last year and some others say they are being charged $8,000 more.”

A boycott of composting is one response the restaurant owners could consider, Lillian said. Unfortunately, however, they could be fined under a new law that prohibits more than 10 percent recyclables or food waste in their trash bins.

On July 20, City Council held a special meeting to consider the rate revision.

“Even at 90 percent of the trash collection rate, the charge is still 30 to 40 percent of the comparable rates for surrounding cities,” Lillian said. “In addition, the revised contract would allow Waste Management, starting next year, to recoup their losses from lowering their organics collection rates this year.”

Lillian said City Council members were “furious” about the contract and showed support for the restaurant owners. But she acknowledged that council members were negligent in approving a contract that they apparently had not read.

“I do hold them responsible because they should have done their due diligence,” Lillian said. “But I am confident that they will now act on our behalf.”

As part of the contract, she said, the city required Waste Management to switch its truck fleet to use natural gas powered vehicles. To comply, she said, Waste Management had to purchase 86 new trucks for $330,000 each.

“The city should have realizes that Waste Management was going to try to raise rates to cover those costs,” Lillian said. “We expected to get a bit of an increase but this increase isn’t what we thought they signed us up for.”

The Indie Alliance was formed in March after the city passed a minimum wage of $12.25 per hour – a 36 percent increase from the previous minimum wage.

“We’re getting squeezed,” she said. “That’s why we’ve gone from seven to 70 members in the few months. First it was the high wages, then the composting rate hike. And a $15 minimum wage is coming soon.”

Calls to city officials, including Council President Lynette Gibson McElhaney and Sean Mahar of Oakland Environmental Services, were not returned.