As the new millennium dawns bright on the horizon, the world of refuse and recycling continues to defy predictions and astound analysts. Just when it appeared that industry consolidations would continue unabashed, there were digestion problems. Today, stocks plummet and questions rise. And like a landfill with a dust control problem, all the answers seem to be obscured. Yet in the midst of it all, customers still expect their trash and recyclables to be picked up reliably and cost effectively.
This often is easier said than done. Yet here are four collection managers - two from the private sector and two from the public sector - who have tried to settle the dust while blazing trails into 2000. Meet:
* Paul Giusti, Operations Manager of Sunset Scavenger Company, San Francisco, a Norcal company;
* Glenn Grogan, President, and Jim Grogan, Secretary/Treasurer of G&G Sanitation, Cumming, Ga.;
* Vidal Maldonado, Division Manager overseeing garbage collection for the City of Austin, Texas; and
* Susan Young, Director of Solid Waste and Recycling for the city of Minneapolis.
In Waste Age's latest installment of the Collection Manager's Roundtable, here's what these experts have to say about the challenges facing the industry.
WA: The waste industry continues to change, and it appears that the mega-mergers are having digestion problems. What effects will these post-merger issues have on your operations?
Giusti: I'm really not affected by the mega-mergers. We have an ordinance in San Francisco that allows us to be the exclusive provider of garbage service excluding construction and demolition wastes.
Jim Grogan: There seems to be a lot of confusion with the major companies. We do business with these conglomerates, and we find it's difficult to find one person to make a decision.
Glenn Grogan: Any time there's a merger, it creates a lot of confusion. But there's always an opportunity to pick up new customers when there's confusion.
Maldonado: We're fairly competitive in the city of Austin. We do all of the residential garbage collection within the city limits up to four units. Anything above four units, private industry takes care of. We have about 2,500 small commercial accounts, but these primarily are accounts that don't have room for dumpsters. We only take care of small commercial accounts with 90-gallon carts.
We did a competitive bid a couple of years ago where we took a section of the city and competed against the privates. We ended up with the low bid and ended up keeping it within the city. Recently, we had a small community that went out for bid. They weren't happy with the results and asked Austin if it was interested in bidding.
Young: There are short-term and what I perceive as long-term effects. The city of Minneapolis is divided in half. Half the city is pulled by city workers while the other half is pulled by a consortium of private haulers, Minneapolis Refuse Inc.
This consortium came into being 26 years ago. It includes everything from the small one truck, two-day a week haulers to the big folks like Waste Management Inc. and Browning-Ferris Industries. Nobody can have more than 50 percent of the stops.
What's happening is the areas with the bigger private haulers have service problems. When you have big mergers, everybody's shook up. The larger companies are taking over other people's routes, and they don't really have a good handle on some of the customer service issues. I get a tremendous number of calls from commercial accounts that aren't mine but that are having trouble with customer service issues, and they want me to do something about it.
In terms of long-range effects, private companies are in a continual growth mode. In order to show growth in this industry, because it is so highly competitive, they have to keep finding new markets. Large cities like Minneapolis are going to be the next area for them to come in on. That means that, long term, I have to make sure that I am competitive.
WA: Within your own region or market territory, what are the key waste issues that you are dealing with and why are these important?
Giusti: The most important waste issues we have are recycling, recycling and recycling. The reason it's important is because it's the right thing to do. Bay Area residents have a heightened environmental consciousness, and they demand recycling. However, San Francisco is not that big. The geographic conditions that we operate under include big, wide streets down to narrow streets where we can't even maneuver the truck. We have to park the truck at the top or bottom of the hill and walk the hill to collect the garbage and recyclables. There's no cookie-cutter approach to this city. You really have to go neighborhood by neighborhood to determine how to collect the garbage and the recyclables.
Jim Grogan: There's a lot of growth in the companies that we deal with today. Of course, the Atlanta area probably is like all metropolitan areas. We're faced with a lot of growth, which is good for us and changes almost daily.
Glenn Grogan: We're very fortunate that we have two conglomerates in our area. Both have major landfills with capacities of probably another 25 to 30 years.
We're also fortunate that a lot of transfer stations are based around the area where we haul, which is a plus. However, a minus is the traffic that we're beginning to deal with. Over the past five years, it has slowed us down considerably.
Maldonado: Like most cities, we are concerned about the future of disposal. In our case, it came to a head a little sooner than in most areas because we owned a city landfill. It still had another 15 years of life in it, but when the city converted an old Air Force base into an airport, Federal Aviation guidelines stated we can't be within 5,000 feet of a runway because the landfill attracts birds. Consequently, we were forced to close our landfill for household waste.
This forced us go out and contract with landfills. Fortunately, three fairly large landfills are around the city of Austin that have quite a few years of life, so we had competition for our business. The question of what to do with our waste also put us in a position to institute a pay-as-you-throw (PAYT) system where people pay according to the size of their cart. They also have to pay additional fees for garbage outside the cart.
We have one of the premier recycling programs in Texas, so that's another way we've tried to reduce the amount of garbage we have to dispose of.
Young: Minnesota is on the cutting edge - sometimes the bleeding edge - of regulations. My county has asked me to separately handle televisions, CRTs, VCRs and computers. I expect there will be further demands right down to all consumer electronics. To be more competitive, the pressure is for co-collection, the one-pass system. There is regulatory pressure to increase separation. Reduction of toxicity is a big theme in Minnesota. The way [regulators] can be effective is [to regulate] the back of a truck.
WA: What steps or actions have you undertaken to ensure that you're ready to compete and win in the waste industry in the new millennium?
Giusti: It seems that garbage companies all buy the same type of equipment. There is a finite number of styles of trucks, so we have to be technologically better. Things such as global positioning systems (GPS) on the debris box trucks and front loader trucks allow us to be more efficient with how we route and dispatch.
We're currently experimenting with automated routing to see if that will help us break our routes seasonally, especially for the curbside recycling trucks during phone book and holiday seasons where we have a definite spike in the amount of recycling materials we pick up.
Additionally, on front loaders, we're looking at on-board scales and routing systems. We try to stay ahead of emerging technologies and figure out how to use new technologies in business.
Jim Grogan: Good service. I think that's the major thing. We are service-oriented, and that's one of the things we strive for as we have for the past 25 years. So far, it has paid off for us.
Maldonado: Five years ago, we still were using a manual collection system with an operator and two helpers working the back. Our first step was going to the PAYT system using carts. Now, we've reduced the personnel from three men to two because we we're running a semi-automated system with tippers. We have plans to start converting to one-man automation next year for the purpose of remaining competitive.
Young: We have worked very hard at becoming more efficient and acquiring better equipment. When I came here, the bulk of the trucks were 10 to 13 years old. My guys could flip a quarter and know whether or not they would make it back to the shop at the end of the day. We are on a pay-as-you-go basis. But we now have a fleet that we can depend on that's fairly easily maintained.
Recently, we have been looking at routes, and we cut two routes this year. I've been challenging contractors to be more competitive and to give us better prices every time we go in for a contract with them. That's hard for them, too. We're down to the point where I think that we could compete against anybody in the industry right now. It's do or die time.
WA: Recruiting, training and retaining good staff always has been difficult. How do you ensure that you're getting and keeping the best talent?
Giusti: In the old days, we relied a lot just on recommendations. Someone said, "I think this guy is a good guy," or you brought your son into the business and the son, because of peer pressure, had to live up to the expectations or he'd let his dad down. That's changing now as we try to become more culturally diverse.
As the sons and grandsons of the old-time garbage men go to college or pursue different careers, we've had to look to outside sources for these people. One of the more progressive things we've done is to hire a human resources manager. We did this about five years ago and it brought in professionalism.
The other [way to retain good people] is training. You have to train people, and I think we do a good job with that.
The last thing is to pay them. I think we pay very good wages in San Francisco. Our benefit package is fantastic. Employees get full medical and dental [coverage] with no payment on the employee's part to contribute to the plan. The plan covers the wife or spouse, domestic partner and dependents.
We also have an employee stock-option plan. We're 100 percent employee-owned, which goes a long way. Whether you're working on the truck, in the office or in the boardroom, we're all partners in this company. That really goes a long way toward getting the people to want to see the company succeed and continue.
Jim Grogan: In this particular area, that probably is the major problem of every company.
Over the past few months, we are probably the only company I know of that has been fully staffed. It has not always been that way. We try to be extremely fair with the employees. We try to pay a good, fair wage. We try to be involved in their family lives. We have an open door policy. They can walk right in and talk to us at any time about any problem.
Glenn Grogan: We're certainly blessed with good employees. We have 40-something people on staff, and we don't have a bad apple in the barrel. These are good, hard-working people, and rarely a day goes by that we don't get a phone call, letter or something complimenting us on our employees. We are a family owned business, and these guys know that they can come and talk to us. They also know that when they need help, Jim and I will get into the truck and help them catch up.
Maldonado: There's a lot of construction business, so there's a lot of competition for drivers. For years, our pay was not competitive with the industry. Our guys not only have to drive, they also have to collect, so when there's an opportunity for them to just drive and make more money, they leave. We ended up having to hire unlicensed folks, train them and give them their commercial drivers license. Usually, after they got a little experience under their belt, they left.
This definitely has forced us to improve our employees' pay, which also could be counteractive when you're trying to remain competitive. We evaluate drivers. Additionally, everyone has to go through a minimum of two weeks [of driver training], depending on how much experience they have.
Every supervisor has a trainer under them. We bought special trucks so that there would be enough room to train a person. We also have a trainer shadow new employees. We just got approval to get a goal-based pay system in place where everybody can benefit.
Young: We haven't been. This is an area where we have to do a much, much, much better job. We just got the numbers last week and our turnover is becoming unacceptable. We have to get a handle on work ethic. We have some folks that have been in the division a very long time that are absolutely outstanding people. But new people come in with a different work ethic. They have a different attitude and are very savvy at manipulating the system to their benefit.
I am not sure how we are going to deal with this challenge: how to recruit motivated, skilled individuals that can stay drug and alcohol free.
WA: For the most part, recycling and waste diversion programs are reaching a new maturity. What's the current status of these programs in your area, and how well do you think they're working?
Giusti: Our curbside recycling program is approximately 10 years old, and I think it's going very well. We're going to expand a new program of total commingled recyclables pickup. Residents will be given a 32-gallon cart, and all the containers and fiber will go into that cart. Our pilot studies have shown [we can expect] up to 50 percent diversion from that type of program, so we're going to be expanding that. We are really excited about it but we're not going to meet our goals just from the residential waste stream.
Commercial is one area that we will have to go after even more aggressively for our diversion. We have a really great produce and food waste recycling program for the commercial sector. We collect [food waste] from produce markets and restaurants. It is hauled to our transfer station in San Francisco, then goes to a landfill where it's composted. This has the potential to really create a large amount of diversion.
Additionally, currently we are running a window glass front loader route where we go to all the window glass shops in San Francisco to pick up glass for recycling. Twice a year, we also host neighborhood clean ups, called the Super Recycle Day program. [As part of this program, we are] at the curb separating metals, yardand wood waste, untreated wood, garbage and large bulky items.
Glenn Grogan: We try to recycle, but there's not a market for the materials. Of course we [collect] corrugated, but we often work with other recyclers and subcontract the recycling. It's pretty tough for us to haul [the materials] and make a profit selling it.
Nevertheless, some areas have mandates to recycle, and we have to furnish reports to the city. A city that's just south of us mandates recycling for the companies within the city. We went to a meeting the other day with some of the conglomerates, and we were very shocked to find that G&G was the only company that was recycling and reporting back to the city as we should have been.
Maldonado: A few years back, the state mandated a 40 percent diversion rate. Now, I think it's 50 percent. We're not there yet, but we're getting very close. Our diversion rates probably are in the high 30s.
We divert all our yard waste from the landfills. It actually goes into a compost that is mixed with the sludge from the water and wastewater treatment [plants] here in Texas. It's called Dilo dirt, and a lot of the nurseries buy it.
We also have a bulky and heavy brush collection that's done twice a year. And then we have our recycling programs. We pick up containers, plastic, tin, aluminum, glass and paper products, primarily newspapers, magazines and cardboard. We have about a 75 percent participation rate in the city.
Young: Minnesota and the regional county consortium, which sets policies, are going on a major reduction push. But when we have a good economy, we're going to have lots of garbage. People are not going to say, "No, I'm not going to buy a new sofa because I need to reduce waste." We're seeing increased garbage, which is kind of freaking out the regional consortium.
I am the local naysayer, because I don't see an education program or variable rate billing reducing or changing behavior. What we've seen is increased amounts of illegal dumping as statewide variable rate pricing goes into effect. As suburban communities stop collecting yard waste, people just dump it illegally into streams and rivers. We haven't found a way to change people's behavior in grocery stores and in the fast food area yet. We haven't found a way to drive the message home at the point of purchase.
WA: Tales from the Streets: What's the most interesting or unusual event that has occurred in the field with your collection crews?
Giusti: Most of them aren't fit for print, I'm afraid. But what sticks with me day after day is the basic good-heartedness of a typical garbage or recycling collector. For example, one of our collectors was working and this woman on the street was absolutely hysterical. She only spoke Spanish and this collector spoke a little bit of Italian. But somehow, he was able to figure out that she was a nanny and was watching a child. She walked out of the house to get the mail and the door locked behind her.
We have keys to just about every garage door and back yard in San Francisco to collect garbage, so the collector went into the backyard and sized up the situation. He climbed up to the second floor along a ledge and found an open window. He could see the child in the highchair, who was fascinated that our guy was crawling along a ledge. Once inside, the hauler said the child stopped crying. He opened the door and brought the child outside.
And by this time, there was a whole crowd of people gathered around because this woman was hysterical. When they saw him come out with the child, everyone broke into a big round of applause.
Jim Grogan: One of the most interesting things we see is people that throw things away that they shouldn't have, and they want to follow us to the landfill and get it out.
We had one occasion where a lady had thrown away some of her deceased mother's jewelry and we made a special effort to dump it. We called the landfill and they let us dump it out so that my driver could find it for her. She was very thankful.
We also had a dentist office throw away some expensive equipment the other day, and, of course, he had to go to the landfill to get it.
Maldonado: Every summer, we have a high incidence of pool acids being thrown into the trash.
We've had employees injured from inhaling the fumes. You'd think people would know the dangers of the pool chemicals.
We had another incident where there were some things thrown in the garbage [that came] from a funeral home and should not have been thrown in the trash. I remember that caused quite a stir.
Young: My guys return blind basset hounds three blocks over because they know they belong in Mrs. Jones' yard. My crews are getting a reputation for their mission that a clean city is job one. I never realized that graffiti was a solid waste problem until recently, and I'm now the graffiti maven in addition to everything else. We take a lot of pride in our community, and my folks are doing an outstanding job of finding new and better ways to maintain a clean Minneapolis. They take on the things that need to happen to create a clean city.
I'm incredibly proud of my folks, and I think they're really stepping up to do the customer service things that we'll need in the new millennium.
Trucks:41 Crane Carriers with Leach 2RII or Kann bodies.
Containers: 32- and 90-gallon Otto containers; 21-gallon Shamrock containers; 20-gallon Rehrig Pacific containers.
Customers: 107,919 residential; 50 municipal, including fire department, police department and public works garage. (Residential pickup is split evenly between city crews and private contractors.)
No. of Employees: 34 in MSW division; 14 in recycling; 14 in yard waste (for seven months a year); three in problem materials division.
Service Area: All residential buildings with five or less units; some buildings with more than five units.
Services Provided: Residential garbage collection; recycling; yard waste collection; pick up of metals and appliances; vacant lot cleanups; neighborhood clean sweeps; graffiti removal.
Local Tipping Fees: $39 per ton for MSW; $35 per ton for yard waste.
Trucks: 19 roll-off and 10 front loader Macks.
Containers: 2-, 4-, 6- and 8-yard front loaders; and 10-, 20-, 30- and 40-yard open top containers manufactured by Lewis Steel Works, Nu-Life Environmental and Galbreath. Marathon supplies compactor units.
Customers: 4,000 commercial customers.
No. of Employees: 45.
Service Area: Forsyth County, Ga., located 40 miles north of Atlanta, as well as the metro Atlanta counties of Fulton, DeKalb, Cobb, Gwinnett, Douglas, Cherokee and Hall. Also, northern Georgia counties Dawson, Lumpkin, Pickens and Gilmer.
Services Provided: Front loader service; front loader cardboard recycling; 10-, 20-, 30- and 40-yard open top containers; compactor sales, service and hauling; and sludge removal.
Local Tipping Fees: Approximately $26 to $32.50 per ton.
Trucks: 28 Crane Carriers with 20-yard Leach bodies; 20 Internationals with 25-yard Pak-Mor bodies.
Containers: 32-, 64- and 96-gallon universal Toter carts.
Customers: 136,500 residential; 2,500 commercial (small producers, no dumpsters).
No. of Employees: 94 field employees; 14 administrative/supervision.
Service Area: City of Austin city limits.
Services Provided: Residential and commercial (small producers) collection; recycling; and residential collection of yard-trimmings, brush and bulky waste.
Local Tipping Fees: Approximately $14.50 per ton.
Trucks: 200 pieces of equipment, including REC, FEC roll-off, compacting and non-compacting recycling side loaders. Trucks are Volvo/White; bodies are Leach Co., Lodal and Heil.
Containers: 32-, 64- and 96-gallon Toter carts.
Customers: More than 130,000 residential and commercial.
No. of Employees: 400.
Service Area: 75 percent of the city and county of San Francisco, excluding downtown and marina districts.
Services Provided: Recycling; construction and demolition debris removal/recycling; residential and commercial waste collection; sludge hauling.
Local Tipping Fees: $59.04 per ton.