Los Angeles Business Journal

L.A. Council Votes to Consider Waste Franchise System

By Howard Fine Wednesday, November 14, 2012

The Los Angeles City Council on Wednesday voted to move ahead with an exclusive franchise waste hauling system for most commercial and multifamily properties in the city.

The 11-3 council vote approved the concept of a franchise system where a single hauler would be chosen through a competitive bid process to pick up trash from commercial and multifamily properties in one of 11 zones, similar to the cable television franchise system. Currently, commercial and multifamily properties can contract with any permitted waste hauler to pick up their trash.

As part of the motion the council approved, administrators must return to the council in February with an implementation plan for an exclusive franchise system, which could start next year for multifamily properties. The council also voted to send a series of amendments to committee for further consideration, including exemptions for hospitals, some non-profits and for entertainment companies.

Proponents of an exclusive franchise system, including environmental groups and labor unions, say the city could require franchisees to meet recycling mandates, raise wages and improve conditions for workers. They contend it would also reduce the need for haulers to drive to different parts of the city to pick up trash, meaning fewer trips and less wear and tear on city streets.

But opponents – including independent haulers, commercial and multifamily property owners and some business groups – said an exclusive franchise system would put scores of small haulers out of business and eliminate competition, which in turn would mean higher rates for customers. They said the city could achieve many of the same goals with a system that allowed multiple haulers in each zone.

Last week, a spokesman for the opponents said they have raised several hundred thousand dollars for a possible petition drive to place the franchise system on the ballot.