Collection managers share their ideas on subjects ranging from privatization to alternative fuel trucks.
As the refuse industry readies itself for the 21st century, collection managers say there still are several 20th century problems to be solved. Classic issues such as disposal capacity imbalances and recycling mandates continue to challenge the best and the brightest. And, the attraction of technology careers is creating shortages of nuts-and-bolts professionals such as drivers and mechanics.
Nevertheless, at least four collection managers - two from the public sector, two from the private - say the industry today is better than it ever has been, and the best is yet to come.
For its annual survey of collection managers, Waste Age sat down with:
- Kelvin L. Baker, public services director for the city of North Miami Beach, Fla.;
- Michael Camara, vice president and general manager of ABC Disposal Service Inc., New Bedford, Mass;
- Drew Sones, assistant director for solid resources management for the city of Los Angeles; and
- Bill Terry, chief operating officer of Rumpke Consolidated Co., Cincinnati.
Here's a glimpse at their assessment of the current, as well as the future, industry.
Waste Age (WA): What are the crucial issues facing the industry today and in the next 5 to 10 years? How are you addressing these concerns?
Baker: We're going to have to be careful as to what is disposed of because ultimately it will affect our water supply. [We] need to be very creative in the products that we produce, understanding that those products will have to be disposed of. If that's understood during product research and development, we can avoid a lot of long-term problems. In North Miami Beach, we are not landfilling our garbage, but sending it to a co-generation plant.
Camara: The biggest issues today are the lack of disposal space, lack of quality drivers, and high disposal and fuel costs. We're in the final stages of permitting a 500 ton per day construction and demolition (C&D) debris recycling center and municipal solid waste (MSW) transfer station. We also spend more time training drivers. The economy is doing well, and our area has a low unemployment rate, so everyone is looking for drivers at the same time. Training requires a large effort but it's something we need to do as we get more business.
We've tried to bid fuel, but right now, vendors will not enter into long-term agreements or fix pricing. We pass that cost to our customers.
Sones: One is technology and the other is alternative fuels. Technology has helped us become more efficient. For example, on-board computers help monitor truck and driver performance. And instead of cutting out maps, supervisors can use electronic dispatching and routing systems. This technology has kept us competitive with the private sector.
The South Coast Air Quality Management District's new refuse trucks will be powered by alternative fuel, either liquified natural gas (LNG), compressed natural gas (CNG) or propane. We have a fleet of more than 600 diesel refuse trucks. We're trying to figure out how to pay for retrofitting our yards with alternative fuel dispensing stations, retrofitting our maintenance garages because they need additional exhaust systems and dealing with other things related to alternative fuel. You lose about 10 percent capacity with alternative fuel refuse trucks because the trucks require more maintenance, which translates into more trucks and drivers to finish the same route. We've not been satisfied with any of the alternative fuel trucks we've seen. This is an area I think will sweep across the country.
Terry: The industry is maturing, and we need better planning and management. Garbage disposal hasn't changed, but the challenge is how to handle waste most effectively.
We also need to consider future regulatory changes and recycling's role in the waste management hierarchy. We've made it clear that our principal values comply with all solid waste, safety or truck operation regulations and issues. We also believe that we have a contractual obligation to deliver the service we've committed to.
WA: Privatization or reverse privatization - which is more of a concern and why?
Baker: I'm in favor of municipal collection vs. a private collection system primarily because I believe the customers have a stronger voice. Many municipalities that have privatized are considering taking their services back because there was a major loss of control and accountability.
Camara: In our area, there's more privatization than in the past. We are seeing communities willing to give up some of the work they were doing. We grow our business by finding ways to save communities money.
Sones: Seven years ago when the new mayor came in, the big "P" word was blasted all over the media. His platform was to privatize refuse collection; we got a big shock when that happened and we began to look at our costs. Our service level was outstanding but our operations were quite costly. In the next four years, we looked at how we could be more efficient and effective to reduce costs. At the end of three years, we cut costs by 25 percent, about $8 million per year. Once we came forward with these reductions and with the union every step of the way, the emphasis on privatization went away. In fact, other agencies that are using private contractors are asking us whether we would provide our service to them.
Terry: I was the deputy director for streets and sanitation for Dallas before I joined the private sector. I realize that what we do is an environmental, health and safety issue, and an essential public service.
The role of government is to ensure its citizens' health, safety and welfare, and to do it efficiently. When you get into the argument of efficiency vs. effectiveness, the private sector questions how effective [the public sector] can be. The public sector hides that there are limited tax dollars available, and considering all the public sector's costs, is solid waste something that it ought to be doing?
Many forward-thinking cities in this country have privatized. The private sector has resources that can be spread across many entities, so that there is no replication of sanitation departments or no situation where a truck only works in this town today and tomorrow may not be working at all.
WA: Is it getting any easier to hire and keep good people?
Baker: Our wages probably are far above the minimum for truck drivers, so we've not had a great deal of turnover. With a fully automated system, the operation tends to be very clean and professional. There is a sense of pride in our system because our operators never really touch the garbage. Some of the negativity about garbage collection workers is not felt here. We are working on an incentive program to reward drivers for a safe driving record all year.
Camara: We offer more benefits, including health care, dental, a 401k plan and profit sharing, and have found them to be helpful in attracting drivers. Business is good, and by adding more trucks we need more mechanics. Currently, our mechanics are getting a lot of overtime, but we constantly run ads looking for more mechanics.
Sones: It's becoming more difficult because of technology. We no longer need a truck driver with strong arms. Our fully automated trucks require skill and dexterity. Many applicants can drive a truck, but they don't have the skills to do some of the other things required in automated collection. We pay our drivers a good rate, so when we recruit, we get a lot of interest. Nevertheless, we lose a lot because of technology. Now we're looking for a different type of individual who grew up with computers and with video games - they seem to work the best.
Terry: I don't think it's getting easier to find good employees. Our goal is to create a climate that rewards people. We also try to provide a safe working environment. We have to give employees equipment that runs. A driver hates to go out on a route and have the truck break down every other day.
This means the right preventative maintenance (PM) mechanic has to make sure that she has PMed the trucks appropriately so the drivers can get the job done the next day.
Currently, the workforce is more female and minority. But I'm not sure that we've done enough to reach under-represented demographic groups.
WA: What landfill tipping fee trends do you see, and how are changes in disposal systems such as decreasing numbers of landfills and increasing numbers of transfer stations and other waste reduction efforts affecting your operation?
Baker: We are taking our garbage to a co-generation plant roughly five miles away, so we're able to transport those items quickly. In Dade County, we have a 20-year agreement with the Metropolitan county where tipping fees are based on a Consumer Price Index (CPI). Within the past five years, our prices have increased 2 percent to 3 percent. Prior to that we were running $60 per ton and $70 per ton. Now we are at about $46 per ton. With this agreement, we experienced a major savings in tipping fees. We also have agreements with two different local vendors to take our recyclables. As a result, we are able to avoid the tipping fee. I am saving about $30 per ton with the recycling initiative. This is an incentive for our commercial accounts because if they didn't recycle, we would charge them based on additional pickups or larger containers.
Camara: As more states close landfills, we see a lot of interstate waste shipments. We've opened options by having a facility where we can consolidate the waste and transfer it out - either in- or out-of-state. We're in a state with an approximately 2 million ton per year shortfall. We've seen the fees in the past couple of years and believe that it's just a matter of time before there is another considerable tipping increase. There are areas in Massachusetts with fees more than $100 per ton. Unfortunately, we don't have enough recyclers. We face long lines at recycling centers. Communities would like to see us pick up more materials, but without the proper markets, there's not much that we can do. Communities are faced with much higher recycling costs than they imagined. They thought there would be a tremendous return on the recyclables and they'd be able to offset some of their costs. But communities have to pay a processing fee or a disposal cost to have recyclables processed.
Sones: We're looking 20 to 50 years down the road at how we're going to manage our waste and what we need to adequately and safely do it. A key issue is, how much waste will there be? Waste diversion is a very big component as you look into the future. The city of Los Angeles adopted a diversion goal of 70 percent by 2020. This reduction will not occur at the curbside because we're already pulling as much as we can out of the waste stream from the 720,000 households we service. We're conducting a pilot on mixed waste processing in the next year to determine the diversion rate to see if the process is worth implementing. The biggest bang for our buck will be in the commercial sector and C&D. We have a very good landfill agreement that could take us through 2020 at a price that's very reasonable. But we're now looking beyond that to make sure we have what we will need. The next step after the local landfill closes is railhaul, and that means we will look at a regional kind of cooperation.
Terry: The challenge is to get the right number of large landfills in the right place, and that means we look at the geology, the transportation network and the population base. Obviously, if you go with regional landfills then transfer stations become more important. You've got to get the garbage there, by rail, barge or truck. The critical issue is planning. It can't be a short-term solution. The variable becomes how much does it cost to get the garbage to that landfill outside the city limits, as opposed to one or two counties away. You also have to look at the fees that are being placed on a landfill. I have a landfill in Cincinnati that pays $4 in fees to public entities. Across the river in Kentucky, there is a competing landfill that pays no fees. My gate rates are going to be higher. We recycle 300 million pounds of recyclable materials per year. That number is increasing. We're in it for the long haul. We have to do it profitably or at least break even to get a return on capital investment, so I give it to a manager and I say, go figure out how to make soup out of this stuff.
WA: What is the best aspect of today's solid waste industry?
Baker: Our field, in the past 10 years, has become more professional. Drivers are able to do their job with a lot of pride. We are pushing to run a very clean operation, which promotes a positive image for our city.
Camara: There certainly isn't a lack of work, so that's exciting. We're excited about the way things are right now, but certain issues concern us. One of these issues is, what will happen in this election and where we go from there?
Sones: I like the people involved. It's like a family. Everyone understands this, and the people are great and are willing to help. People in the industry are down-to-earth, and they know they're helping the environment and are dedicated. They want to get better at what they do.
Terry: It's coming to work and knowing that when garbage gets put out and the account is serviced by Rumpke, it's efficiently picked up and disposed of. I also like that this is a business that needs to be managed and it happened to be garbage. Seeing people grow is important to me, and as an industry, we are going to become better managers to service our customers' needs.