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May 22, 2012 > Newark residents face steep garbage collection rate hikes

Newark residents face steep garbage collection rate hikes

A conversation with Administrative Services Director Susie Woodstock

A large rate increase for garbage collection is heading for Newark residents in July. A one year extension of the franchise agreement with Waste Management of Alameda County for solid waste collection and recycling services was adopted May 12 including an initial rate increase of 24%. In comparison, collection contracts in the Bay Area have risen about 23% on average.

The rate increase was effective June 1. However, since Waste Management sends quarterly billings, June was included on the March bill for the months of April, May and June. To compensate for the increase of this last bill, City Council approved use of the City's Waste Augmentation Fund to pay for the June increase; this fund is designed to help offset rate increases. However, Newark residents and businesses will see - and feel - the increase effective July 1st.

To understand why rates are increasing so rapidly and how consumers can soften the impact, TCV recently spoke with Newark Administrative Services Director Susie Woodstock.


TCV: How were current rates set for garbage collection established?
Woodstock: The original contract was awarded through a RFP (Request for Proposals) in 1995. At that time base rates were set with factors for annual increases. Extensions were approved in 2005 and 2009. Each year, City personnel meet with Waste Management to assess the need for and amount of a rate increase.

TCV: Was there any warning of a significant impending rate increase?
Woodstock: Watching rates in other communities is an indicator. When we began negotiating last fall, we noticed large increases in other cities but some of them had very low rates or different circumstances so this didn't necessarily mean that would apply to Newark.

TCV: Are there many other providers of this type of service?
Woodstock: We have a consultant to help us to put out an RFP for garbage collection and we have been informed that, on average, four or five providers respond. This is an 'open market' process. In Livermore, for example, a small company formed to handle the contract. Although some cities handle their own garbage collection, in this area, almost everyone uses a contract provider.

TCV: Why is the increase so large?
Woodstock: It is our understanding that the primary cause is labor contracts and regulatory and reporting requirements by public agencies.

TCV: Are Fremont Transfer Station costs escalating at the same rate?
Woodstock: No. We have a 30-year contract with the Transfer Station operated by BLT with a set method for rate escalation to account for inflation.

TCV: What does the Waste Management bill cover?
Woodstock: There are three components to our garbage rates: Waste Management handles collection and recycling; Transfer Station fees and Franchise Tax components are collected by Waste Management then paid to the City of Newark.

TCV: Is there any way for citizens to moderate this rate increase?
Woodstock: There is no exemption for seniors but it is something we may consider in the next contract. The rate is strictly based on the size of the garbage can used, not on the recycling or green waste receptacle. Those who reduce the size of their garbage can will see a cost savings. Since rates are not based on the size of the recycling or green waste cans, they can even be increased without extra cost to the consumer. There is also a reduction through Waste Management for those enrolled in the PG&E Care program.

TCV: How can people increase their recycling and green waste?
Woodstock: I believe that Newark has a 70 percent recycling/green waste diversion rate. We can do better. For some, paying attention to this and considering how full their garbage can is at collection can result in a smaller garbage and a cost savings. There are three free bulky pickups each year to take care of intermittent increases.

The City of Newark encourages recycling and green waste management through staff efforts, Waste Management (www.wm.com or (510) 624-5900) outreach and the Alameda County Waste Management Authority at www.StopWaste.org. Outreach programs and additional information is available through any of these resources. Staff members including myself, Administrative Analyst Laurie Gebhard and Planning Manager Clay Colvin are also available to assist at (510) 578-4000.

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