Sanitation Commissioner Kathryn Garcia says she expects to make a decision July 1.

"I get to determine if there's [composting] ­capacity in the region and which industries would have to source-separate their organics," Ms. Garcia told Crain's. "We're still running through the data, but it's based on how much [food waste] the different industries generate, how close they are to one another—so we try to eliminate any increase in truck traffic—and then, again, it's also about capacity."

The news that the city could require businesses that serve or sell food to start separating their compostable waste came as a surprise to some industry leaders.