The Business Journal recently ran a story describing efforts to transform L.A.’s commercial and multifamily waste market. (“Foes Pile Up on L.A. Trash Plan,” April 18.) Unfortunately, the Business Journal undersold a crucial piece of the story.

The cost of trash in Los Angeles is on the way up – and without strategic action, small businesses and apartment buildings are going to pay the bill. A competitive franchise system for the commercial and multifamily market provides the best protection for those ratepayers and the best path for our city to handle its waste.

The cost of waste will rise for L.A. businesses because the permit system servicing commercial properties is inadequate for responding to imminent state regulation and rising landfill costs. Distinguishable from L.A.’s award-winning, city-run residential trash service, the existing permit system also results in quality-of-life costs, such as too many dirty trucks, traffic congestion, and wear and tear on our streets.

The origin of these costs is multifold. For starters, the California Global Warming Solutions Act (AB 32) will soon require all municipalities to ensure recycling services for commercial buildings and apartment complexes. Under L.A.’s current system, providing recycling in commercial or apartment buildings is completely optional – so, predictably, many can’t recycle where they work or live. With AB 32, recycling will no longer be an option. This means additional costs.

Second, Los Angeles is losing its dominant public dump. Puente Hills landfill – the second largest in the country – has historically charged L.A. waste haulers artificially low dumping fees, helping to keep “tipping fees” at the region’s other landfills in check. However, Puente Hills will close in 2013. So, we can expect those depressed fees to disappear and haulers to pass the increased landfill costs on to customers.

Costs to Angelenos

Finally, the current system imposes other costs on all Angelenos – unnecessary emissions, wear and tear on city streets, traffic congestion, and a general lack of accountability. If you live on a block with apartment complexes, chances are you see multiple trucks from multiple companies servicing adjacent buildings every trash day. Permitted haulers service needlessly overlapping routes, in many cases, with dirty diesel trucks. This is a Wild West: Accountability and accurate auditing are virtually impossible, hauling companies realize no economies of scale (and pass those inefficiency costs on to customers), and Angelenos pay with their health and quality of life.

In the face of these realities, the current system offers little protection or price stability – and for many customers, rates will increase. In fact, some small businesses and small apartment complexes are already being charged unfairly. The Don’t Waste L.A. Coalition, 30 organizations calling for more recycling, clean air and good jobs in L.A.’s commercial waste industry, reviewed waste service bills for more than 70 small businesses and apartment complexes. Within a three-mile radius, some customers were paying up to $400 a month while others paid less than $100 for the same service plan.

Some argue that this disparity is simply a matter of hard bargaining – and haphazard rates are no reason for change. However, these disparities are emblematic of a commercial waste system in dire need of evolution – and as a matter of public policy, the city and business community should ensure fairness in fixed costs for small businesses. Large companies and apartment owners have multiple properties and waste volume that afford them pricing leverage when soliciting bids. Small businesses don’t have that bargaining power and are subsidizing the bigger companies’ rates.

In advocating for the status quo, the city’s well-heeled business community is throwing their smaller brethren under the proverbial garbage truck. They’re also throwing the rest of us under there by urging the city to ignore the broader negative impacts of the current system.

Los Angeles is the second largest waste market in the country and a lucrative place for waste companies to do business. Yet, we’re not maximizing the potential of this asset for our city and we’re not protecting the small businesses that will feel coming changes in this industry most acutely. The city needs to get a hold of its commercial and multifamily waste system – not only to protect our air, maximize recycling and create good jobs, but to ensure fair rates for its small businesses and landlords. A competitive franchise system will make these things possible.

Greg Good is director of the Don’t Waste L.A. Project at the Los Angeles Alliance for a New Economy, which advocates for good jobs, thriving communities and a healthier environment.

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