Argus-Courier coverage of the Great Petaluma Garbage Fiasco of 2005

Garbage decision may get dumped

Public outraged over prospect of higher rates;
council will reconsider contract next month

January 26, 2005

By COREY YOUNG
ARGUS-COURIER STAFF

The City Council could vote on a new garbage contract again at a meeting next month after last week's selection of San Francisco waste hauler Norcal Waste Systems led to a firestorm of controversy over higher rates

"The people of Petaluma are not happy, and I made the wrong decision," she said

Councilmember Mike Harris, who also voted for Norcal, supported a second vote

"We need all the information spelled out for every citizen," he said. "We need to have the full discussion and get a matrix of all the residential rates, all the commercial rates and all the senior rates.

During her campaign for council, Nau supported a proposal from a fourth company, North Bay Corp., that would have lowered rates while increasing recycling. But in October the council voted against considering the proposal because it came after North Bay had been rejected earlier

On Monday, Nau said a competitive bid process should be re-opened

Members of the council minority welcomed another vote but argued against starting a bid process

"My concerns are strictly financial," Mayor David Glass said. "Norcal has revolutionary technology. I'm just not sure that Petaluma can afford the price.

Councilmember Pamela Torliatt said the council needs to vote again, but should not ask for new proposals.

"It's time that we made a decision on this, for the lowest rate and the highest recycling," she said

The council will take another step before a second discussion of the garbage contract happens. On Feb. 7, council members will formally vote on whether to schedule another garbage vote possibly for Feb. 28

The council changed course after widespread opposition to the Norcal choice, which a city consultant said could lead to a 116 percent in-crease in monthly garbage rates

At a Sat-urday meeting following the Jan. 18 vote, residents de-cried proposed rate hikes and the council majority defended its choice by laying out a plan for customers to recycle more and pay less

The fallout began almost immediately after the council voted 4-3 to negotiate a 10-year garbage contract with Norcal, even though Empire Waste's proposal was recommended by City Manager Mike Bierman and the city's consultant after lengthy negotiations with all three companies

But in rejecting the recommendation and voting in favor of Norcal, council members Keith Canevaro, Mike Harris, Karen Nau and Mike O'Brien said Empire Waste's proposal didn't include a high enough recycling rate

They wanted to hire a company that could recycle up to 70 percent of Petaluma's waste, leaving only Green Waste and Norcal as possibilities. Empire Waste said it could eventually reach a 70 percent "diversion rate" but did not estimate rates for that threshold

They gave the edge to Norcal, council members said, because of its innovative recycling program, its proposal to build a recycling center in Petaluma and the fact the Green Waste would be hauling Petaluma's garbage to its composting center at Gilroy, in the central valley

"I don't think anybody disagrees that Norcal is the best company," Canevaro said

"If you want quality and service, Norcal's the best," Nau said at Saturday's council session on future goals, where over 100 people, many of them seniors, turned out to protest the garbage decision

They criticized the council's choice of a company that consultant Hilton Farnkopf and Hobson said would raise rates between 38 and 116 percent"I think you need to reconsider this vote," Bill Donahue said. "The seniors of this community demand your attention

Public calls for another vote continued Monday

"If somebody can do as good a job at a lower price, I think we ought to go there," Donald Davis said

"You need to vote for what the people want, not what you think we want," Colleen Dunaway told the council

Petaluma's business community was also up in arms over the choice of a company whose 10-year contract value for 70 percent recycling is $101.7 million, twice what Empire Waste offered for a 60 percent threshold

"My phone's been ringing off the hook," said Onita Pellegrini, executive director of the Petaluma Area Chamber of Commerce

"We're concerned about what will happen to business rates," she said. An increase of more than 100 percent "is really astronomical for business.

"Marie McCusker, executive director of the Petaluma Downtown Association, said merchants met last week to voice their opposition to the council's decision

"Business here is going to suffer because of this," she said

Noting that the city spent $233,000 in consulting fees during the garbage search, she said, "I think it's an absolute waste of public money to spend that much on a consultant and not listen to the recommendations.

That money is required to be repaid by the chosen hauler, the city said.

Canevaro, Harris, Nau and O'Brien defended the Norcal choice in interviews following the Jan. 18 meeting, stressing that a final rate structure had yet to be negotiated between Bierman and the company

And, they said, the notion that rates would more than double was just plain wrong

Monthly garbage rates are based on the size of a customer's garbage can, and right now most of Petaluma is using a can that would be too big once Norcal started expanded recycling in the city, they said

Here's how the council members said Petalumans could recycle more and save money under Norcal

With Norcal scheduled to take over on July 1, customers will be given three new cans: a black can for garbage, a blue can for recycling and a green can for yard waste

With all recycling -- including new items like most plastic containers, office paper and heavy cardboard -- going into the blue can, and yard waste being picked up every week, Norcal will be able to reach the 50 percent recycling threshold immediately and 70 percent in 2007

The garbage can Norcal will give to customers will hold 32 gallons, the size many cities serviced by Norcal use. Right now, 56 percent of Petalumans have the larger 64-gallon can and pay $15.33 a month for garbage service

Norcal estimates it will charge customers with the 32-gallon can a monthly fee of $12.09 when service begins in July, $3 less than what they're paying now with the larger can

The goal is to have residents put more waste in the recycling and yard waste bins and only throw away what can't be recycled

"The less you put in that black can, the less you're going to pay for," said John Legnitto, Norcal's general manager. "What we've offered is to manage people's waste costs through recycling.

Norcal has a proven track record of increasing recycling in the communities where it operates, council members said

"They have to pay to get rid of what's in the black can," O'Brien said. "They can sell what's in the blue can.

"It's in their best interest to get rid of as much as they can," Canevaro said

"We can give people the smaller can option," Harris said. "We can reward those who recycle. We're giving them the tools by which to do that.

"Getting landfill independent is huge," said Canevaro, noting that an agreement with Empire Waste would have required a five-year commitment to use the Redwood Landfill in Novato

"The citizens want to put as little as possible into the landfill," he said. "I'm looking for a company that excels at active diversion.

At Monday's meeting, Canevaro said he intends to stand by his original vote. O'Brien didn't say if he would change his mind

Last week O'Brien said that the only way the projected increase of 116 percent would materialize is if the city uses every program Norcal offers

That's why Bierman would have worked out a contract with Norcal to specify the recycling programs, rates and likely discounts for fixed-income seniors in Petaluma, council members and Norcal representatives said

At Saturday's meeting, Norcal executives passed out fliers saying that the company offers a discounted rate for qualifying customers, like seniors on a fixed income

Last week other council members were shaking their heads at the Norcal vote

"I didn't think that Norcal would be part of the mix, because of the extreme cost associated with their proposal," Torliatt said. "'Shocked' is the word.

Mike Healy favored Bierman's recommendation for Empire Waste and said the public outcry is enormous

"I've not received this many e-mails or telephone calls on an issue in a long time," he said

At Saturday's meeting, Healy announced he would lead a petition effort to put the garbage choice to the voters if the council proceeded with Norcal

"I will knock on doors and I will stand in front of supermarkets," he said. "I am confident that voters will overwhelmingly reject the 116 percent increase.

At Monday's council sessions, Healy asked those in attendance for a show as hands as to which garbage company they supported. A few hands went up for Norcal and Green Waste, but Empire Waste was the overwhelming favorite

The council minority questioned how Norcal can keep rates from skyrocketing when its $101.7 million contract proposal is twice the $50.5 million contract Empire Waste offered and Bierman recommended

"The bottom-line costs for this community are those figures," Torliatt said

Empire Waste spokesman James Landa said his company was surprised at the council's choice

"We have been flooded with calls from our customers upset with the decision the council has made," he said. "I don't think anyone can imagine having a 116 percent rate increase.

The Petaluma Downtown Association gave permission for Empire Waste to use its name when calling Petaluma residents after the vote and urging them to speak out to the council, PDA president Jeff Mayne said

"We endorsed a message that is being used to let people know how we feel about what is going on with the garbage contract situation," Mayne said. Empire Waste has been a good partner at Petaluma events like Butter and Egg Days, the antique fair and the Art and Garden Festival, he said

"We want them on board," he said. "We want to support them now, as they have supported us.

Landa said if the decision stands, Empire Waste will continue to be on the job until Norcal takes over and, despite losing contracts in Santa Rosa, Rohnert Park and other cities recently, Empire Waste is still going strong

"We still have a substantial coverage area" in Sonoma, Mendocino and Marin counties, he said. "Petaluma's just a portion of the business we have.

The Norcal choice led some to question the motives of the council majority, with members of the public at council meetings criticizing O'Brien for not returning $800 in campaign donations he received from Norcal employees

"I think it's unethical to be voting on this issue," Ellen Bicheler said to O'Brien

During the campaign O'Brien repeatedly denied that any of his donors were trying to buy his vote, and he did so again last week

"My vote is not for sale, it has never been for sale and my integrity is beyond reproach," he said at Saturday's meeting

The $800 came in the form of four $200 tickets to his golf tournament fund-raiser, and after paying for expenses and the fee for an event coordinator, his take was far less, O'Brien said

He didn't return the money, as fellow candidates Torliatt and Cindy Thomas did with donations from Green Waste, because it would have sent the wrong message, he said

"My feeling was, if I gave the money back, then my vote is for sale," O'Brien said

Canevaro, Harris, Nau and O'Brien all denied any improper contact with representatives of the garbage companies and said they limited their contact to phone calls, facility tours or other official business to gauge the pros and cons of each firm

They all said they took Bierman's recommendation seriously and did not settle on Norcal before the negotiation process was complete.

"My decision hadn't been made until I heard the presentation at City Council," Nau said

NORCAL'S PROPOSED RATES

Norcal said it would deliver 32-gallon garbage cans to Petaluma customers. With most Petalumans using a 64-gallon can and paying $15.33 a month right now, they could save money immediately by using the smaller can, Norcal said. The company's proposed rates are:

$12.09 a month for a 32-gallon can at the 50 percent recycling level, beginning in July.

$19.26 a month for a 32-gallon can at the 70 percent recycling level, beginning in 2007.

WHAT HAPPENED AND WHAT HAPPENS NOW

The City Council voted 4-3 last week to negotiate a 10-year garbage contract with Norcal Waste Systems, one of three firms proposing to handle Petaluma's waste

On Saturday, more than 100 people turned out to protest the decision, citing a city consultant's report that estimated rates could rise up to 116 percent under Norcal

On Monday, councilmembers Karen Nau and Mike Harris, who voted for Norcal last week, reversed course and said the council should reconsider the vote.

On Feb. 7, the council will vote whether to reconsider the decision

If the council votes to reconsider, another discussion of the garbage proposals could happen Feb. 28.

NORCAL WASTE SYSTEMS

Headquartered in San Francisco

Established in 1921

Owned by its employees

Handles garbage and recycling for 50 communities in California

Petaluma would be its first Sonoma County contract

Web site: sunsetscavenger.com

Sidebar on Norcal consultant Brian Sobel

Sobel defends Norcal work

January 26, 2005

By COREY YOUNG
ARGUS-COURIER STAFF

Former council member Brian Sobel, a political consultant in Petaluma who represents the Norcal garbage company favored by four council members last week, said he didn't pressure city leaders to choose the firm

"I would never ask a public official to make a decision for a client of mine," said Sobel, adding that he represents Norcal in other cities as well and that his job was to advise company executives, not provide access to council members

All the firms seeking a new garbage contract from the city have local consultants advising them, he said, such as former county supervisor Ernie Carpenter and former city manager John Scharer

Sobel said he advised Norcal officials on how to respond to the city's request for proposals and how to make their case to the city. He was hired because of his experience with city governments and came on board after Norcal got involved in Petaluma

Though he knows several of the council members personally and said he has contributed to almost all the current members, Sobel said he never asked for a political favor during the garbage debate

"I have never asked a public official for a vote," he said

All four council members who supported Norcal last week -- Keith Canevaro, Mike Harris, Karen Nau and Mike O'Brien -- said they weren't pressured to make a choice or asked to vote a certain way in exchange for a favor. They denied any improper behind-the scenes meetings with representatives of the companies

Nau said she did refer some callers last week to Sobel, because they wanted to know specifics about Norcal's rate proposals and she only had the city consultant's estimated rates

"He's the only person I know locally that knows the rates," she said. The next day, Norcal posted information for Petalumans on its Web site, and she referred the public there, she said

Argus-Courier editorial, January 26, 2005

Council swallowed garbage lobbyist's line

City leaders should rescind action and award contract to Empire Waste

January 26, 2005

The Petaluma City Council deserves kudos for voting to reconsider its choice of a garbage service provider for the city. It deserves a kick in the pants for getting it wrong in the first place.

Actually, the public has already delivered the kick, verbally booting council members for voting 4-3 to authorize negotiations with Norcal Waste Systems of San Francisco. When residents realized that a contract with Norcal could raise their garbage rates by as much as 116 percent, they quickly and loudly let council members know their decision was completely unacceptable.

At least two of the four errant council members -- Karen Nau and Mike Harris -- listened to their constituents and on Monday agreed to reconsider their vote.

The proposal should come back and the council should follow the recommendation of City Manager Mike Bierman and its independent consultant, Hilton Farnkopf and Hobson, and choose to retain Empire Waste Management as Petaluma's garbage service provider.

The city's independent consultants estimate that Empire Waste's rates would increase 3.8 percent over the 10-year life of the contract, while Norcal rates would jump 38 to 116 percent. Ten or 20 dollars a month may not be much to some people, but to others, especially those on a fixed income, it is a great deal. Petalumans are repeatedly faced with rising fees for everything from sewer service to cable television. Still, they have been willing to increase their taxes for schools, fire service and road improvements. Garbage rates do not exist in a vacuum.

Norcal proponents say that because of increased recycling, more Petalumans will be able to use smaller cans and thus pay less even if the rates increase. But the exact same argument can be made for Empire Waste, which would also be going to a single-stream recycling system that will make recycling easier and far more attractive to residents.

Norcal says it will reach 70 percent recycling. But that promise is contingent upon locating and building a local recycling facility. And guess who will eventually pay for this new facility? That is, if a location can be found at all. Most neighborhoods welcome garbage facilities with about the same enthusiasm as they greet skateboard parks.

Garbage disposal is a very lucrative business. City consultants estimate that a 10-year contract would be worth more than $101 million to Norcal, but only about $50.5 million to Empire Waste. Those numbers say a lot about how much money will eventually be paid to the city's next garbage service provider by Petaluma residents and businesses.

What made four council members steer so far off track in awarding the contact to a company charging roughly double what Petaluma's existing provider was bidding? The answer lies in the high-stakes game played by garbage companies in California who are aggressively competitive and must steal shares away from other companies in order to grow. To do that, they hire the best local lobbyists available when a new bidding process opens up for a garbage franchise.

In the case of Norcal, they were able to hire one of the most influential and persuasive lobbyists in Petaluma: former Petaluma City Councilman Brian Sobel.

With his close personal relationships with council members Mike O'Brien, Keith Canevaro, Mike Harris and Karen Nau, Sobel was the perfect fit. His job: Sway a majority of the council to vote for Norcal. Sobel did his job quite well and was undoubtedly paid handsomely for his services.

However, by ignoring the intelligent and logical recommendation of the city manager and the city's independent consultant, and instead relying too heavily on the word of a paid mouthpiece for one of the bidding companies, four council members did a huge disservice to their constituents. While there is nothing improper about listening to paid advocates, these council members should understand that paid lobbyists are working solely for the cause of their clients, not their constituency.

It is the job of each and every City Council member to work for the public that elected them, not the lobbyists or, in the case of Councilman O'Brien, the garbage company (Norcal) that donated money to his re-election campaign.

Effective, responsive and responsible public service is best served by the council unanimously awarding the garbage franchise negotiating rights to the company recommended by their knowledgeable and experienced city manager and the city's independent consultant: Empire Waste Management.