Budget and Legislative Analyst complicates Recology's effort to expand its waste disposal monopoly in San Francisco
"We have said from day one that transportation was a component of the request for proposals [for the landfill disposal contract] that no other company other than Recology had an option to bid on," Tucker said. "Had we been able to bid on the transportation component, our costs would have been lower."
Tucker believes that no matter who wins the landfill contract, the BLA report points to a lack of transparency and openness under the city's existing refuse ordinance.
"Up until this time, no one has been able to understand the process," Tucker said. "If the Budget and Legislative Analyst has shown that there are some inconsistencies in the statements made by the Department of the Environment, if the process has slight flaws, then the whole process from the request for proposals to the pricing needs to be revised. And time is on the City's side. There is no need to rush into a decision. Yes, our contract with the city is ending, but our capacity at the Altamont clearly goes into 2030 and 2040. So, this is an opportunity to toss out [Recology's] proposal and start again."
Asked if Recology is planning to rail haul waste to Nevada, once its Ostrom Road Yuba County landfill, Alberti said that the city's current procurement process prohibits that.
"Will that be around next time? I don't know," he said. "Recology's first goal is reducing waste, and managing it responsibly. We believe rail haul is an integral part of that."
And he insisted BLA's report should not be connected to Recology's disposal contract.
"Recology believes that the system is working very well, as evidenced by the fact that it's yielded the best diversion rates, lower rates than average, and has an open and thorough rate-setting process set by an independent body," he said. " We feel the recommendations are separate from the matter-at-hand. But if the board so chooses to have this debate, we're anxious and happy to be part of that discussion."
David Gavrich, CEO of Waste Solutions Group, which transports waste by rail and barge from San Francisco, praised the BLA report for "finally peeling back the layers of the onion" on the city's entire waste system. Gavrich notes that in June 2009, he and Port Director Monique Moyer advised DoE of an option on a piece of long-vacant port property that offers direct rail and barge transportation of waste and could result in tremendous long-term savings to ratepayers.
"But we never got a reply to our letter," Gavrich said. "Instead, DoE pushed forward with Recology's trucking of waste to the East Bay, the transloading of waste from truck to railcar in the East Bay, and the railing of waste east to Yuba County."
Sup. Ross Mirkarimi, which sits on the Board's Budget and Finance Committee, is concerned that the city is considering enlarging Recology's monopoly, without calling into question the reform of the 1932 charter.
"I don't think these two questions should be disconnected in the way they are in the proposal to award Recology the landfill disposal contract," Mirkarimi said. "The city and the DOE are very defensive about this and have a well laid-out defense to show that they followed the letter of the law in awarding this contract. But that leads to a secondary set of concerns: namely are we getting the best bang for our bucks, and is there something less than competitive about the current process."
Mirkarimi admits that Recology has been committed to many of the city's environmental policy advances. "But that's aside from the larger question of what this mean in terms of institutionalizing further the expansion of a monopoly," he said. "Our utilities are governed by monopolies like PG&E. So, should we be going in the same direction as 1932, or thinking if we want to diversify our utility portfolio?"
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