Trash Talk Heads to Courthouse

Disgruntled apartment owners and home owners’ association members vented their frustration about L.A.’s new trash collection system during a meeting earlier this month at the Apartment Owners Association headquarters in Van Nuys. The biggest concern for the participants was the increase in prices, with some calculating a 500 percent uptick compared to what they have historically paid. Others complained of reduced customer service and lack of communication by the city regarding the change. The apartment association is the lead plaintiff in a class action suit against Los Angeles. The lawsuit seeks an injunction on the new franchise trash system. The group is also lobbying local politicians and may sponsor a ballot measure on the issue. Under the Zero Waste L.A. Exclusive Franchise System implemented in July, trash collection for the city’s commercial businesses is serviced by seven companies. The program divides the city into 11 zones, and designates each zone to be exclusively serviced by a single trash hauler. Previously, garbage collection was an open market, with more than 100 companies competing to take away garbage from businesses including apartments, strip malls and condominiums with a shared dumpster. The Valley region will be serviced mainly by Waste Management Inc. and Republic Services Inc. While the companies have started services on portions of their designated zones, full implementation will be complete in December, according to Waste Management. John Landsberger is a managing partner for several hundred units throughout Los Angeles, with the majority of his portfolio in the Valley region. Landsberger said he has worked with his soon-to-be trash hauler Republic for the last few weeks to negotiate the new rates. “I’m trying to strategically figure this out,” he said. “If I keep the same level of service, I will have to pay 300 percent more than what I used to.” Carolin Shining, an attorney representing the plaintiffs, said the legal basis for the lawsuit is that the city is in violation of Proposition 218, which states that local government taxes must be approved by a vote from the public. “The councilmembers approved this plan before they had any idea what the rates will be and how it’s going to work,” she said. “Making people pay extra and telling people to reduce services are monetary burdens with a personal cost of dealing with more trash.” Public monopoly Apartment owners’ complaints about the new system amount to a textbook list of the ills of a monopoly. For example, Landsberger’s 36-unit apartment in Van Nuys is currently serviced by Athens Services which collects from its dumpster six times a week. He pays around $450 a month. With new rates implemented by Republic, that price will jump to around $1,100 a month. Adding in the extra “opening gate fee,” which is charged every time a hauler opens the gate to access a dumpster, and the total for Landsberger will come out to just over $1,400 a month. What upsets Landsberger the most was the lack of opportunities for business participation around the new ordinance. “They (the city) got a lot of input from haulers but never came to business owners in terms of implementation and what is reasonable,” he said. Marty Hoffman, who owns two apartment buildings in Van Nuys and North Hollywood, said implementation of the program for his properties didn’t go smoothly. When tenants complained of trash piling up on his property, he repeatedly called his new servicer, with no success. “In the past, if I was unhappy with one, I would have the opportunity to call another and get them to come in,” he said. “I’m stuck. There’s nothing I can do about this.” Adrian Gross, owner of a 14-unit building in Studio City, said that the city’s forced arrangement has taken away consumer choice. “We are contractually and legally obligated to play by their (haulers) terms,” he said. “Who are the trash collectors answering to? Who will be regulating them?” The bulk of the regulation is in the hands of the Los Angeles Bureau of Sanitation, which will enforce the contractual agreements the city has made with the new service providers. Karen Coca, division manager for the bureau, said the transition is the largest endeavor of its kind with more than 80,000 accounts transitioning to new services. These accounts include small and big businesses, apartment buildings and condominiums with more than three units. Coca said all 80,000 account holders were sent information about the program in June. “We have been preparing for this new system for about seven years, but transitioning accounts from different permitted and non-permitted waste haulers is complex and not without challenges,” she said “Regardless, our goal during this transition and long term is to provide the highest level of customer service.” She encouraged customers experiencing issues to call the bureau’s customer care center at 1-800-773-2489. RecycLA According to Coca, the new trash hauling franchise program, now branded as recycLA, was designed to provide overall environmental benefits, such as less street congestion, improved air quality and more recycling facilities. The companies that won the contracts from the city are required to operate clean air vehicles and build new facilities such as an organics processing plant, in preparation for organic waste recycling services that will be rolled out for businesses in 2019. Doug Corcoran, director of Public Sector Southern California Area at Waste Management, said the company will invest about $80 million on a new facility along with dozens of new clean air vehicles to service some 16,000 accounts it will inherit by the end of the year. “The requirement of the contract is above and beyond anything I’ve seen in the business in 30 years,” said Corcoran. “At that level of investment, failure is not an option.” Corcoran said the consumer reaction to the initial rollout has been mixed. As for price hikes, he’s sympathetic to them and said his staff will sit with each customer to assess the fees. “It will take people some time to get their head around this idea, but things have changed,” said Corcoran. “It’s not your grandfather’s service anymore. You are comparing two different programs.” One of the newly added services is blue recycle bins, provided free of charge by L.A. Sanitation. Coca said for some apartments, this is the first time they will have recycling services. However, many property owners like Landsberger think this style of recycling is a noble idea with a thoughtless execution. For example, his tenant Maria Cazares, who lives with her five children in an 800-square-foot apartment, will not have the space nor time to recycle, he said. “How do I educate my tenants in trash recycling and get them to actually do it?” he asked. “Who is taking the responsibility for educating the public?” According to Coca, the service providers have hired 400 field staff to educate the public, and L.A. Sanitation has 40 inspectors who are performing ride-alongs to evaluate service providers. Political fallout Councilman Bob Blumenfield, who represents the West San Fernando Valley, said his office has received over 22 complaints regarding the massive price increase since the program has rolled out. “First, we are trying to make sure they meet with the hauler to figure out where the cost increase is coming from,” said Blumenfield. “Part of the obligation of the franchise is that we expect haulers to work with each customer to figure out how they can make their bills cheaper.” Blumenfield said that he has been working with Councilman Mitch Englander to push a motion that will consider bin sharing among businesses. “We have to find creative ways to address this issue,” he said. Blumenfield added that the program has bigger purposes in mind, echoing the reclycLA’s mission: increased recycling, reduced waste and relief from traffic congestion. However, Dan Faller, president of the Apartment Owners Association, remains unconvinced. Faller said regulations around clean air vehicles and increased recycling could have been implemented without awarding exclusive contracts. Also, whereas previously haulers paid a 10 percent fee to the city, the franchised haulers must pay 12 percent – an arrangement Faller believes will ensure it’s in both party’s interest to keep rates high, to the detriment of businesses. “The city’s politicians will be getting political support from unions and money from the companies,” he said. “We are opposing it based on the fact that this is a monopoly and free enterprise is always better for our capitalistic society.” The association will be in court next month for a hearing on their request for an injunction.