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Articles from 1998 In February
Waste Reg Usurps Property Rights?
A city-county waste flow control plan discriminates against interstate commerce and may unconstitutionally usurp property rights, according to a ruling by a federal appeals court. (Waste Management Inc. of Tennessee v. Metropolitan Government of Nashville and Davidson County, No. 95-5863, 6th Cir., Nov. 5, 1997.)
The governing authority for Nashville and surrounding Davidson County, known as "Metro," enacted a batch of ordinances and regulations to control locally generated waste.
First, the system required collection companies to transport waste to Metro-approved sites. Next, it imposed a special disposal fee on waste that haulers did not bring to Metro-owned or -designated facilities. Finally, operators of disposal facilities within Metro territory were required to accept, without charge, waste transported in passenger vehicles and to charge no more than $5 per load for waste delivered in pickup trucks.
The plaintiff, Waste Management, is among several companies that are licensed to collect and dispose of waste within Metro's boundaries, but it is the only hauler that also operates a waste disposal facility inside such limits.
The company filed suit in federal district court in 1995 challenging Metro's flow control system. U.S. District Judge Thomas A. Higgins permanently enjoined enforcement of the waste disposal fee provisions, but left intact the flow control regulations and the passenger vehicle and pickup truck ordinance. Judge Higgins ruled that the regulations and ordinance were nondiscriminatory and that the burdens on interstate commerce were not excessive when compared to local benefits.
The U.S. Court of Appeals for the Sixth Circuit upheld the lower court's decision to prohibit Metro from charging the waste disposal fee. It agreed with the district court's conclusion that the fee was "facially discriminatory," citing differential treatment of Metro and non-Metro interests. "[T]he fee is not imposed upon waste disposed of at [Metro-owned facilities] and ... it is only imposed upon the plaintiff and [Browning-Ferris Industries, Houston,] both of whom dispose of waste at facilities outside of Metro's boundaries," the appeals court said.
However, the three-judge appellate panel ruled that Metro's flow control provisions discriminated against interstate commerce and that the governing authority had "other means of advancing [its] legitimate local interests."
The court sent the case back to the district court for further consideration of the plaintiff's claim that the passenger vehicle and pickup truck ordinance constituted a "taking" without just compensation in violation of the Fifth Amendment of the U.S. Constitution. Waste Management had argued that the ordinance amounted to an outright invasion and taking of its facility because the company was required to set off a portion of its property specifically to accommodate arriving cars and trucks.
The appeals court speculated that an exclusive dedication could be "tantamount to [Metro's] physical occupation of plaintiff's property," but handed the lower court the task of deciding whether the ordinance amounted to a physical taking of plaintiff's property and, if so, whether the plaintiff had an opportunity to seek compensation from Metro under Tennessee law.
Under U.S. Supreme Court rulings, a plaintiff cannot bring its "taking" claim directly to federal court unless redress procedures under state law are unavailable or inadequate.
In a separate opinion, handed down a month before the Metro Nashville decision, the same appeals court ruled that a local government does not interfere with interstate commerce by rejecting a proposed landfill that would accept out-of-area solid waste. (Eastern Kentucky Resources v. Fiscal Court of Magoffin County, No. 95-6360, 6th Cir., Oct. 15, 1997.)
In 1991, a landfill developer bought property in Magoffin County and negotiated a contract with county officials to construct a landfill for the disposal of local and out-of-state garbage. The developer agreed to close the county's old landfill and to provide host fees and free residential garbage collection.
The county, for its part, submitted a solid waste management plan to the state, noting its intention to use the private landfill. The state rejected the county's plan and declined to process the developer's landfill application. Meanwhile, a state court invalidated the contract between the county and the developer. After an election changed the make-up of county government, local officials revised the solid waste plan, eliminating any landfill within the county and sending all garbage outside the county for disposal. The state approved the plan.
The developer unsuccessfully sued in federal district court, challenging the constitutionality of the state's waste disposal program. On appeal, the Sixth Circuit ruled that the state program, as implemented by the county, neither burdened interstate commerce nor discriminated against out-of-state interests. Furthermore, the state's legitimate interest outweighed whatever burdens were placed on interstate commerce.
technology: Powering Trucks to Buses: This Spuds for You
What do you get when you cross a bunch of scientists with used French fry cooking oil? Gas, but not the smelly kind.
For instance, in Idaho - a state best known for its potatoes and French fry production - researchers have developed a biodiesel fuel produced from used French fry oil. This oil, combined with ethanol, called hydrogenated soy ethyl ester (HySEE), reportedly can be used in diesel engines with little or no modification, according to the Pacific Northwest and Alaska Regional (PN&A) Biomass Energy Program, the Idaho Department of Water Resources and the University of Idaho's Agricultural Engineering Department.
To prove this concept, PN&A recently began an "Over-the-Road" HySEE demonstration project that involves running a Kenworth tractor-trailer rig on a 50-50 blend of HySEE and regular diesel fuel. Following a three-day process, the J.R. Simplot Co., a French fry potato manufacturer, produces the HySEE in 500-gallon batches. It takes approximately 1.25 gallons of waste French fry cooking oil to create one gallon of biodiesel.
In addition, Simplot operates the Kenworth tractor-trailer, which is averaging 5.5 miles per gallon, at its plant in Caldwell, Idaho. Over a two- year period, Simplot will produce 20,000 gallons of biodiesel, and the Kenworth will cover 200,000 miles. After the demonstration, the rig's 435-horsepower Caterpillar 3406E engine will be disassembled to assess the impact of using the new fuel.
Several of PN&A's other programs involve American Indian tribes. For instance, Idaho's Nez Perce Tribe now is using biodiesel fuel in a Dodge pickup, a Ford pickup, a Suburban, a lawn mower and a garden tractor. The tribe has its own plant which makes fuel derived from used cooking oil from several area restaurants. Here methanol, rather than ethanol, is used because it is less sensitive to water.
Another interesting example of biodiesel testing is the "Truck-in-the-Park" demonstration. This project's goal is to reduce Yellow-stone Park's pollution by using biodiesel fuel in tour buses and park trucks.
Perhaps of greatest interest to park officials is that the biodiesel produces less visible smoke. Also, the exhaust has a nicer odor than its more conventional counterpart: Some say it smells like cooking French fries. However, the pleasant smell concerned park rangers who were afraid that it might attract Yellow-stone's bears.
So, to alleviate these concerns, the National Park Service conducted a study with 10 captive bears and concluded that the animals weren't attracted to the smell.
Researchers say that biodiesel fuels, either produced from vegetable oil or animal fat, are environmentally friendly. For instance, their gaseous emissions are less than with regular diesel fuel. In fact, since the ingredients in biodiesel are part of the natural cycle, they could lead to zero net gain of carbon monoxide and carbon dioxide emitted into the atmosphere.
Additionally, unlike fossil-based diesel, vegetable oils contain negligible sulfur levels, thus their combustion would not emit acid-rain-causing sulfur dioxide. Also, since the fuels are biodegradable, they break down quickly preventing long-term soil or water table damage.
Likewise, the HySEE fuel, in particular, can reduce the cost of producing biodiesel fuel by more than $1.40 a gallon since waste French fry oil costs 11 cents a pound versus about 30 cents for virgin vegetable oils, such as rapeseed oil (the more typical bio-diesel source), researchers say. Currently, at approximately $3 a gallon, cost is the main factor inhibiting biodiesel's widespread commercialization.
Doubtless, the impact of these studies will be far reaching, given that approximately 4 billion pounds of waste vegetable oil and animal fat are created in the United States annually.
The PN&A Regional Biomass Energy Program covers Alaska, Idaho, Montana, Oregon and Washington. For more information, contact PN&A, DOE Seattle Regional Support Office, 800 5th Ave., #3950, Seattle, Wash. 98104. (206) 553-2079.
trucks: Don't Let Oil be a Financial Drain
Optimizing oil drain intervals can reduce vehicle downtime and maintenance costs. However, proceed with care: Extended oil drain intervals, whether based on miles, hours or fuel consumption, can leave you in the lurch if they are not properly planned and monitored.
While extending intervals will use less oil and filters and decrease disposal hassles, you might face unexpected costs if you exceed your engine's or oil's capability.
When determining an optimum drain interval, consider: * engine sump capacity;
* filtration type and capacity, engine oil consumption, fuel consumption;
* operation type; and
* number of drivers, oil analysis records, computerized maintenance records, fuel quality, oil quality and new technology.
Successful extended oil drains ensure that: * The engine oil has excess capability for the oil drain interval.
* The oil filter has adequate contamination holding ability and efficiency, and the media is chemically and thermally inert on hot used oil.
* The engine has excess capability for the oil drain interval.
* Coolant treatment matches oil drain interval.
Avoid the largest risks with extended intervals, such as failure to continue oil sampling, failure to continually review the interval, unknown lube oil formulation changes and unknowingly extending the extended interval.
Change the oil when: * The dispersant is overloaded with soot, filters plug, viscosity increases unacceptably and heat transfer through the oil is unacceptable.
* The acid level becomes too high, and "higher" metals corrode.
* Excessive heat exposure causes oxidation, filters plug and viscosity increases unacceptably.
* Excessive piston deposits cause loss of oil control, carbon packing/ring scuffing and pin bore deposits stop pin rotation.
* Anti-wear additives deplete.
When extending drains, you run the risk of the oil dying and, thus, the engine dying. After the drain interval is established, oil typically can die due to changes in engine application, average fuel rates, idle time and performance.
Additional causes include oil performance changes, trace amounts of antifreeze and stretching the established drain interval.
The engine dies slowly if soot or sludge cause high wear, anti-wear additives are depleted or filters plug near the end of the drain interval. It dies quickly if filters plug early in the drain period, the oil filters fail mechanically, piston deposits produce ring scuffing/carbon packing, ring loss of function/oil consumption or skirt deposits/piston seizures and viscosity increases, and cold weather yields zero oil pressure at start up.
Oil analysis' time must have come, because you rarely hear a fleet manager say he has submitted duplicate samples and fooled the company analyzing its oil. But remember, used oil analysis is not a sole criteria for oil drain intervals. At best, it only permits estimating maintenance intervals.
Used oil analysis can advise if the oil is suitable for continued service, forewarn equipment problems, establish a drain interval, monitor progressive wear, detect corrosive acids and be a part of failure analysis. The report is divided into several sections and includes wear metals, additive metals, contaminant metals, non-metallic contaminants and vital statistics on the lubricating oil. When a report is bad, resample the unit immediately and check for other problem signs.
Oil drain intervals also can be extended by using synthetic oils, adding an additional oil sump, changing the full flow filter frequently and employing a by-pass filtration system.
Synthetics in transmissions and differentials offer extended component life, improved cold weather flow, reduced component temperatures by up to 50 degrees, more resistance to oxidation, reduced warranty claims, increased fuel economy up to 2 percent and reduced maintenance.
New engines and on-board oil supply systems can extend or avoid conventional oil changes through continuous oil replacement and electronic controls that monitor the engine and synchronize system operation with the engine's actual duty cycle.
Acquisitions American Disposal Services Inc., Burr Ridge, Ill., has completed the stock acquisition of Canton, Ohio-based R.C. Miller Enterprises Inc., one of Ohio's largest private solid waste companies.
Eaton Corp., Cleveland, has concluded the sale of its worldwide axle and brake business to Dana Corp. for $287 million. Prior to the sale, Eaton's axle and brake operation had 3,400 employees at nine facilities in five countries, with annual sales of more than $600 million.
Stone Bluff, Okla.-based Greenway Environmental Inc., a waste management company, has acquired Chief Supply Corp. in connection with Chief's Chapter 11 reorganization in the Eastern District of Oklahoma's U.S. Bankruptcy Court.
Oshkosh Truck Corp., Oshkosh, Wis., has acquired McNeilus Companies Inc., a leader in the refuse body and concrete mixer industries. The companies have signed an agreement for Oshkosh to buy McNeilus for $250 million, which includes all stock and non-compete and ancillary agreements.
Eastern Environmental Services Inc., Mt. Laurel, N.J., has completed the acquisitions of Pine Grove Landfill Inc., a 174-acre municipal solid waste landfill, and Pine Grove Hauling Co., which provides commercial and residential collection services. Both are located in east central Pennsylvania and are projected to have revenues, net of internal disposal costs, of approximately $15 million on an annualized basis.
Allied Waste Industries, Scottsdale, Ariz., has acquired ECDC Environmental L.C., whose principal asset is the ECDC landfill located in central Utah, from Laidlaw Environmental Services of Delaware Inc. and RACT Inc. (a Utah Corp.). Total consideration paid in the transaction consisted of approximately $90 million in cash, about $51 million of assumed debt, a promissory note for $10 million and $10 million contingently payable upon the satisfaction of certain earnings targets. Allied also will reimburse LaidLaw approximately $14.7 million in cash for trust funds, securing the landfill's obligations.
Agreement PEI Power Corp., Wilkes-Barre, Pa., a subsidiary of Pennsylvania Enterprises Inc., has signed an agreement with the Keystone Sanitary Landfill, Dunmore, Pa., providing PEI intends to use this supply of methane gas to fuel its recently 25 megawatt co-generation plant in nearby
waste-to-energy: Electric Deregulation May Shock the WTE Industry
The era of regulated electric utility monopolies clearly is coming to an end. This deregulation will change the way electric utilities generate, distribute and sell electricity and will increase the choices consumers have to purchase their electricity.
In reality, the electric power industry isn't just being deregulated - it is undergoing a major revolution. Significant changes affecting wholesale power transactions already are in effect. The major changes, however, will be coming this year and into the early part of the 21st century.
Electric deregulation has become a hot topic in state houses. Last year, legislation was introduced in 23 states with study commissions established in another nine states. Several states already have pilot programs.
In this light, the owners and operators of waste-to-energy (WTE) facilities are faced with both challenges and opportunities. WTE facilities can capitalize on the restructuring by selling power beyond their boundaries. Soon, municipally-owned facilities may be able to serve their communities or other retail customers using market-based rates and self-service wheeling.
On the other hand, existing WTE plants may have been financed with expectation of electric sales and capacity payments well above future market-based rates. These subsidized rates essentially have been buried within the overall structure of the utility's regulated rates. With deregulation, such subsidized rates may be in jeopardy.
Significant competitive opportunities exist, however, for the WTE industry: * Assess other energy markets: Deregulation will allow WTE facilities to use their electricity internally within a local government through self-service wheeling. Most owners and/or operators have not considered this option or were prohibited by state regs to wheel their power to other community energy users.
For example, it may become feasible to sell electricity generated from a WTE facility to a community's water and wastewater treatment system, airport, administrative complex, municipal lighting district or correctional facility. This would require, however, greater coordination of governmental operations currently not experienced by most communities. In some instances, the cost savings realized may underscore the value of having a WTE plant as part of a community's public works infrastructure.
* Optimize existing system performance: Many electric utilities have informed WTE plants that in the future they may not need the plant's electric production. Consequently, WTE owners and operators will have to find ways to optimize the plant's operation during the utility's peak demand times and scheduling maintenance during periods of low demand.
WTE plant operators will have to find ways to optimize their facilities' performance through additional heat recovery equipment or upgrading controls to maximize system performance. To ensure that they receive their entitled contractual payment levels, facilities should evaluate metering and telemetry equipment.
* Become knowledgeable about your state's energy deregulation debate: Notwithstanding recently-filed Congressional bills, most of the action in energy deregulation, and its impact on the WTE industry, will take place at the state level. The battlegrounds already are drawn in a number of states with several environmental groups over whether WTE is included with other renewable energy generation sources ("Green Power") from which utilities must purchase a minimum percentage of power.
A recent Solid Waste Association of North America (SWANA), Silver Spring, Md., survey suggests that, by and large, the WTE community appears to have little information about the recent Federal Energy Regulatory Commission (FERC) rules and state rulemaking. As a result, states may be making rules without significant input from the WTE industry.
* Work with other WTE facilities: WTE facilities in a region or state could team with one another in bargaining for higher electricity sales and purchase prices. These plants could tie together significant amounts of megawatts and be more attractive to new electric generation purchasers entering the deregulated energy market.
* Find help to pay for MACT plant retrofits: Some state public service commissions are allowing their electric utilities ways to recover stranded costs and eliminate long-term contractual payments to independent power producers using "one time" cash payments. These payments may provide timely financing of capital improvements mandated by the new MACT rules for large WTE facilities.
recycling: Now You're Cooking: New Uses for Old Appliances
In an effort to tap the more than 300 million potentially recoverable and reusable pounds of high-value plastics used in discarded appliances, Minneapolis-based Appliance Recycling Centers of America Inc. (ARCA) and the U.S. Department of Energy's (DOE) Argonne National Laboratory, Argonne, Ill., have embarked on a 16-month pilot project at ARCA's Minneapolis appliance shredder facility.
During the pilot, researchers will study economical ways to separate and recover highly-pure plastics, such as acrylonitrilebutadiene-styrene (ABS) and high impact polystyrene (HIPS), from shredded household appliances.
Argonne estimates these recyclable materials' value is about 55 cents to 60 cents per pound for ABS and 30 cents to 35 cents per pound for HIPS. The company will test these recovered materials with the aim of marketing the recovered plastic as raw manufacturing feedstock.
For its part, Argonne will continue to evaluate the processes to seek ways to improve their efficiency. Further, to enhance recycled plastic materials' market penetration, cost-effective methods for improving the recovered plastics' performance also will be developed.
Argonne has developed a technique that reclaims the galvanized steel used in appliance construction. Previously, this steel was considered "scrap" because its zinc coating (used for rust proofing) could not be removed. This technique uses an aqueous solution - like those used in drain cleaners - to dissolve the zinc coating. An electric current then passes through the solution which, in turn, releases the zinc as a powder that can be collected and sold.
The process' by-products are hydrogen and oxygen gases and about a pound-and-a-half of sludge per ton of metal, which is disposed of as hazardous waste. Currently, Metal Recovery Technologies Inc., Chicago, is using this process successfully at its 75,000 ton-per-year (tpy) pilot plant.
The DOE is seeking an industrial partner to build and operate a commercial-size pilot plant with a 200,000 tpy capacity. Negotiations now are underway with a major auto manufacturer for commercial agreements to dezinc galvanized industrial scrap that can be used as raw material in making iron products, such as engine blocks.
By reclaiming galvanized steel, the steel industry has the potential to save $140 million annually in operating costs, plus another $150 million a year in environmental compliance costs, according to Argonne. Additionally, since most zinc is imported, Argonne reports that recovering zinc with its new process could reduce the nation's annual trade deficit by $100 million.
In a third program, ARCA is working with Southern California Edison (Rosemead) at its facility in Compton, Calif., to recycle 30,000 appliances annually. Edison offers customers a $25 check or a $50 U.S. Series EE Savings Bond in exchange for a spare refrigerator or freezer.
"The typical spare 'fridge' is 14 years old and uses twice as much electricity as a more efficient, [newer] model," says Mike Gadd, "Edison's energy efficiency director. By participating in our recycling program, customers will reduce their energy bills, improve the environment, reduce safety hazards and receive cash or a savings bond in return."
For more information, contact Rosemary Barrera at Argonne, (708) 252-7997. E-mail: [email protected]
ASME Offers Waste Management Scholarships College and university engineering students interested in launching careers in solid waste management have until March 31 to apply for a scholarship from the Solid Waste Processing Division of the American Society of Mechanical Engineers (ASME) International.
The scholarship program, which is for the 1997-1998 school year, is intended to encourage students to apply their technical skills in waste-to-energy facilities, landfill design and maintenance, community recycling and other such fields. Any student demonstrating academic excellence is eligible. During the 1996-1997 school year, three students and their respective universities shared $8,000 in scholarships.
For an application packet including eligibility requirements, contact: Elio Manes, ASME International, 345 East 47th St., New York, N.Y. 10017-2392. (212) 705-7797. E-mail: [email protected]
equipment: UST or AST?: A Steel Tank Survey Helps You Decide
Aboveground storage tanks (ASTs) are said to have grown in popularity by 100 percent in the last five years. But are ASTs best for your fleet? The following outline from the Steel Tank Institute, Lake Zurich, Ill., can help you make the decision: 1. What impact will fire codes or regulations have on your decision? National model fire codes generally dictate AST design and installation criteria for flammable and combustible liquids storage. The four major codes are: * Uniform Fire Code (UFC) Appendix II-F, published by the International Fire Code Institute;
* 30 and 30A of the National Fire Protection Association (NFPA);
* National Fire Prevention Code of the Building Officials and Code Adminstrators (BOCA); and
* Standard Fire Prevention Code of the Southern Building Code Congress International (SBCCI).
Check with your local authority having jurisdiction to see what codes or combination of codes they follow. Codes are constantly changing; be sure to determine which version is required in your area. Federal AST regulations are not yet in place, but it is likely that there will be legislation covering ASTs as well as underground storage tanks (USTs).
USTs must comply with federal regulations found under 40CFR Parts 280 and 281, as well as local and state regulations which may be more stringent.
Requirements include leak detection, corrosion protection and spill and overfill prevention measures. Currently, all new USTs must have leak detection systems.
2. Do local fire codes allow ASTs? For example, some codes do not allow fuel dispensing from ASTs at retail sites, but do allow fuel dispensing from ASTs for private fleets.
3. Are double-wall underground tanks required by local regulations or codes? Some jurisdictions do require double-wall USTs, which also may offer advantage of lower insurance rates.
4. Is there enough room on the property for an AST? Check the separation distances required by various codes - each code dictates how closely an AST can be located to buildings, property lines, public ways, dispensers and filling points.
5. Are fire-resistant or fire-protected tanks required? A fire-protected tank may allow reduced separation distances, offering greater flexibility in site selection. On the other hand, USTs generally are not a fire concern.
6. How important are concerns of aesthetics or vandalism? ASTs are visible and therefore are more prone to vandalism. USTs are not visible, improving the "look" of the location and decreasing the possibility of tank damage.
7. How much manpower are you willing to invest in tank maintenance? Exposure means that ASTs must be visually inspected and maintained. Open dikes collect rainwater, snow and possible debris. USTs do not require this kind of maintenance, although cathodically-protected USTs require monitoring of the cathodic protection system every three years.
8. What is the tank's desired capacity? Most codes limit the AST size, particularly for fueling applications. An AST's size and configuration will influence filling procedures, as accessibility to the tank's top is affected. Remote filling may be preferable to avoid the need to climb ladders or stairways. These considerations require more space or lower capacities. The tank's shape also will impact this decision; cylindrical tanks, while higher in profile, may be smaller in footprint than rectangular tanks, which tend to be lower with a wider footprint.
Using compartments, USTs can reduce installation and equipment costs dramatically, while providing increased storage capacity.
9. Are you able to meet the financial responsibility requirements of the EPA UST regulations? Insurance, state trust funds (if in place and solvent) and self-insurance are some means to this end. If these options are not desirable, consider an AST.
Clarification: In World Wastes, December 1997, page four, the editor reported that the city of San Diego sold its solid waste system. In fact, it was the county of San Diego, not the city.
Sometimes, when solid waste managers believe they see an issue or project clearly, they assume that everyone else certainly must see it the same way.
However, in some cases, the audience has a much different perspective and a more limited knowledge of the subject than the speaker. Or, perish the thought, maybe the speaker didn't do a good job of explaining the topic in a manner that the audience could understand.
Although people use the same words, they don't all have the same vocabulary and words can mean different things to different people. In order to communicate properly, both the speaker's and the listener's perspectives and language must be in synch.
As a listener, I am hopelessly addicted to plain language and substantive discussions. The use of jargon, acronyms, initials and double-speak dissolves both my understanding and enthusiasm for the subject being discussed.
Sometimes, the speaker wants to show off a little about how "with it" he is by using jargon to an audience that may be as jargon-deprived as I am. A speaker does not educate or persuade anyone if he insults, confuses or bores his audience.
As managers, we cannot disguise our own lack of knowledge behind language that we have no real understanding of ourselves. No one who cares about the person or group with whom he is trying to communicate wants to make his audience feel stupid.
The only sure-fire way to avoid miscommunication is to determine your audience's characteristics. I am not talking about "dumbing down" your remarks, but rather presenting them in the audience's language, taking into consideration its level of knowledge on the subject.
Audience perspective often is grounded in its occupation. For example, in an operations employee's mind, plans to start a recycling program will spark visions of the vehicles needed, personnel to be hired and routing issues, while a politician's prerogative will be on funding and on the constituents' concerns.
If many differing agendas are applied to the same issue, the likelihood of misunderstanding will increase unless some translation takes place. Someone must be on hand to translate the idea into terms and scenarios the other person/group can understand - and, hopefully, accept.
Translation is the art of arbitrators, public relations experts, facilitators, counselors, consultants and anyone else who takes the time to make sure that all parties arrive at the same understanding. Arbitration translates the concerns of each side in a dispute, while facilitation focuses on conducting meetings logically and fruitfully.
The object is to have a person or team adept at making sure everyone's views are heard and understood by the group. This entity ensures that the rules are understood and followed. It also helps dissolve disputes and gets the discussion back on track, leaving the participants free to debate, rather than direct, the conversation.
There is no need to hire a professional to conduct every meeting, but any level of supervisor can benefit from acquiring these translating skills. One hurdle is evening the playing field during discussions by realizing that all participants are not always equal: No matter how much the higher-ranking individuals at the meeting avow neutrality, those lower on the echelon are aware of rank.
Whether the situation is a customer complaint, supervisor-employee interaction, interdisciplinary problem-solving session or any of the other myriad interactions that transpire hourly, a manager should strive to see the other person's point of view. This allows the speaker to couch his argument in terms he knows the listener will comprehend while simultaneously showing that he understands his listeners' concerns.
As a solid waste manager, you already should be familiar with the concerns of those with whom you interact - employee, customer or boss - because you have "been there." As either a customer of your own solid waste service or as a keen critic of your provider, you probably have been an attendee at many of the discussions you now hold. Likewise, you should be familiar with the local politicians' concerns. It is safe to assume that they want to do the best job they can for their constituents but that they don't have much knowledge of your concerns.
Understanding is a two-way street. Learning as much as possible about the world of your employees, customers and politicians aids you in helping them understand your perspective.
You must be able to listen to your own words from the perspective of the audience you are addressing. If you feel you are not doing this, run to the nearest mirror and help that poor dude understand that he is the one who must learn to listen.
Got a question about your solid waste operations or just want to sound off? Contact Bill Knapp at 3336 Vista Ricosa, Escondido, Calif. 92029. (760) 741-5349. Fax: (619) 740-9177. E-mail: [email protected]
Are You Paying too Much for Insurance?
Are you paying insurance rates that are one-third to one-half less than what you were paying in the late '80s? According to Mark Lundegren, director of risk management for GoPro Underwriting Managers Inc., Richmond, Va., you should be.
With the success of the financial markets in recent years, insurers are making more money, thanks to a high return on their investment of collected premiums. Thus, insurers can accept smaller underwriting profits (the excess of the premiums charged over their costs of providing insurance) and are seeking ways to use their capital - accruing new customers.
This is good news for the solid waste insurance marketplace, which, for years, many insurers would not touch. Now, new insurers are entering the field and existing insurers are introducing new products, charging lower premiums and are willing to take on more risk.
"Anyone who hasn't checked out the insurance marketplace in the last five years should take another look," says James Cox, environmental practice leader for J&H Marsh and McLennan Inc., a New York City-based brokerage firm. "Prices are at an all-time low, and terms and conditions are flexible."
However, insurers aren't going to give you money simply because they like you. Just because you should be paying lower rates doesn't mean you are. To get the best insurance deals available, you need to be a savvy shopper and have top-notch advisers on your side.
Getting the Best Deal One way to keep your insurance costs down is to make sure you're a good risk. Insurers love a well-run organization with an effective risk management program. Because such an organization is likely to have fewer claims, an insurer can afford to charge it less.
Effective risk management techniques include safety inspections and superior training. This may mean reengineering your business processes to make them safer. Such reengineering costs could be more than matched by savings in insurance and other costs.
Another risk management strategy is avoiding risk. Consider contracting out some of your riskiest work. A good insurance broker can help develop a risk management strategy that minimizes risk and insurance costs.
Michele Ryan, principal of Ryan and Associates, a Bakersfield, Calif.-based brokerage says these factors also make a company a good insurance risk: * financial strength;
* a conservative operating philosophy;
* corporate officers with extensive experience in the business; and
* positive results in environmental studies.
The Good Broker Perhaps the most important step you can take is to get a broker who knows your business and the insurance coverages available to your industry. A good broker will get you better coverage, in the right amount, at a lower cost, and can advise you on a variety of matters affecting your insurance.
How can you tell a good broker from a bad one? Look for a broker with a number of accounts in the solid waste business. Get references from similar businesses. Consider using a questionnaire to ensure that the broker has a thorough understanding not only of the insurance business, but also of your business.
You can enlist an insurance consultant, but if you have a good broker, a consultant probably is just another unnecessary entity to pay. However, if you locate a good consultant, you can use a broker simply to formalize your insurance transactions.
Solicit bids from brokers about once every three years, Lundegren recommends, even if you are satisfied with your broker. While you owe it to yourself to make sure you are getting the best of what's out there, keep in mind that solid waste insurance is a relationship business.
There are advantages both to you and to a broker in maintaining a stable relationship. If you bid out your business too frequently, you may drive away the best brokers and end up choosing from among the lesser talent.
How Much Coverage Do You Need? Another way to control your insurance costs is by adjusting the amount of coverage bought and the risk retained. At certain times, it may save you money to accept a high deductible and pay small claims from your own funds. The alternative is to take a low deductible and let the insurer take care of both large and small claims.
Get quotes for insurance at various deductible levels, advises Lundegren, and use these quotes to determine the most cost-effective deductible. A sophisticated insurance purchaser will vary deductible levels as the business cycle drives insurance prices up and down. Your broker can help analyze how much risk to retain and how much to insure.
How high a deductible you can handle depends on your organization's size and financial strength. "A high deductible can lower a company's premium dramatically, but obviously, it's not appropriate if paying the deductible puts the company out of business," Ryan says.
Another factor in choosing deductible levels is your organization's appetite for risk, Cox reports.
One Carrier or Several? Purchasing two or more types of coverage from the same insurer can allow you to: * Reduce costs. Insurers incur various fixed costs to market, underwrite and issue policies. If you buy several policies from the same carrier, the insurer will be able to spread those fixed costs over a larger volume of insurance, resulting in a smaller level of expenses per unit of insurance. The insurer should pass those savings on to you.
In addition, if you buy two policies from the same insurer - one that is likely to generate frequent claims and one that is likely to generate only infrequent claims - the insurer can offer you a better deal on the high claim-frequency coverage, knowing that it probably will realize a higher profit on the low-frequency coverage.
* Avoid problems when making a claim. In some situations, it may not be entirely clear which of two policies should cover the claim. For example, if you have your pollution liability coverage with one carrier and your general liability with another, each insurer may assert that the other one is responsible, and you could experience delays or difficulty getting your claim paid. Having both coverages with the same insurer will alleviate this conflict.
Lundegren suggests that consultants get their general and professional liability coverages from the same carrier. Also, if your business owns a large fleet, you should try to purchase your auto and general liability policies from the same insurer.
Cox says he will try to place all of a big client's business with one or two carriers, in order to realize the economies of scale. However, only about six carriers have the expertise to offer this type of full-service coverage.
It is not always possible or practical to get more than one type of coverage from the same insurer, because often insurers specialize in certain lines and offer no coverage or inadequate coverage in other areas.
Identify one or more major areas of exposure, Lundegren recommends, and make sure you get top-quality coverage in that area from a leading insurer. For example, if you employ a large workforce to transport non-containerized waste, then workers' compensation should be a primary concern: You need a cutting-edge workers' comp policy with managed care components and possibly one of the several innovative financing arrangements available. Once you secure this high-priority policy covering your major exposure, then build the rest of your insurance program around it.
Evaluating Carriers Of course, you're looking for an insurer that will give you the coverage you need at a good price. But price is only one of many factors to consider when evaluating an insurer.
A number of organizations rate insurers' financial strengths, the best known of which may be A.M. Best, Oldwick, N.J. Best's ratings and those of the other agencies give you a good idea of the likelihood that your insurer will go belly-up.
Ideally, your insurer should be rated in Best's "A" range. However, Lundegren says, alternative risk-financing mechanisms may be acceptable for larger operations if they meet your needs better than any of the A-rated insurers.
Ryan never places a customer with an insurer rated lower than B+. She also warns companies to exercise extreme caution before dealing with off-shore insurers, because they have been known to offer extremely low rates, but "you may just be buying a piece of paper," she says. "When you come to make a claim, the insurer might not be there."
Other issues to consider include the insurer's customer service quality and whether it has a reputation for contesting claims. In many ways, when you buy insurance, you are buying the insurer's response in the event of a claim, Ryan explains.
The key is your broker's leverage with the insurer. How much business does the broker do with the insurer? Your insurer will be more responsive if your broker might take a large block of business to a competitor. For example, Ryan recalls one insurer that had always been good in responding to claims. Then, all of a sudden, "it seemed like [with] every claim, they dragged their feet." When Ryan discovered that the insurer had changed its claim personnel, she made sure her concerns were handled before she placed any more business with the insurer.
Renewing: New Face or Old Friend? When renewing your insurance, you'll either stick with your present insurer or try a new one. Ryan suggests considering switching to a new insurer when her customer's and the insurer's philosophies just don't fit. Otherwise, she operates on the "if it ain't broke, don't fix it" philosophy.
If she hears of a better deal, she will discuss switching with the customer even if the customer is happy with their present insurer.
But, before switching, customers should understand the risk that they may not be as happy with their new insurer.
There are two types of insurance customers, according to Cox: Those who shop every year, seeking the lowest price, and those who cultivate a long-term relationship with an insurer, trusting that the insurer will be there for them when the "big one" hits.
Cox recommends that organizations consider the full package of services provided in addition to the price. If prices are driven too low, insurers may leave the marketplace, making it difficult to get good coverage.
If you switch insurers, make sure there are no holes in your coverage. For example, you may need to make a claim when you are covered by your new insurer, even though the event causing the claim happened when you were covered by your old insurer.
If a policy is written on a "claims-made" basis, as many are, there may be some question about who is responsible for the claim or if it is covered at all.
A good broker will ensure that your policies are written so there are no holes in your coverage.
Talk to Me: How Operators Should Communicate with Fleet Managers
There it stands, untried, innocent of the ways of the world, your child, so to speak - a brand new refuse truck.
You sweated over its conception at numerous prebid meetings, paced anxiously awaiting its delivery and tenderly inspected its every inch to assure it was in the best possible shape. Now, you must open the door and offer it to strangers to use, possibly abuse and/or wreck. How do you feel?
If this seems a bit melodramatic, talk to a mechanic who has labored all night, knowing that the vehicle he has worked on is going into battle all over again come dawn.
The fleet manager, in consultation with the operations management, is responsible for the cradle-to-grave decisions regarding the purchase, maintenance and final disposition of the equipment, but only the operations manager can control proper equipment handling. It takes everyone, together, to ensure that the equipment delivers the potential built into it.
So, why, then is fleet management of-ten viewed as a tug-of-war where both the operations personnel and shop crew point fingers, blaming the other side's "ineptitude" as the cause for poor vehicle performance?
Let's look at the common complaints: Operators charge that fleet services fail to provide enough workable equipment in time for the shifts. Meanwhile, in the shop, mechanics tell tales of abused vehicles, indifferent operators, unmet maintenance schedules and coworkers injured by debris carelessly left in the truck cabs.
This type of antagonistic relationship is ingrained in the solid waste organization over the years due, in part, to the conflict between operators' demands and required maintenance.
The situation is exacerbated further when operators assume that the shop knowingly has returned some trucks in a state of disrepair, causing operators to feel they must overestimate their fleet needs.
Indeed, it can be a self-fulfilling prophesy: Assuming that some of the trucks won't work, operators demand more trucks than they need (even exceeding the number of drivers), encouraging the maintenance crew to make available trucks that are less than completely fixed.
As mechanics struggle to keep up the frenzied pace, they must deal with the hazards posed by drivers who salvage refuse items for personal use and then forget them in the vehicle when it is turned in for servicing. When the cab is lifted for engine inspection, these articles become missiles that can break windshields and cause injuries.
By taking a step back, you can see how such situations develop. For example, operators can estimate a daily workload, and the number of personnel, types of equipment and amount of time required on any given day. Although there will be surprises, it is possible to gauge how many employees will not report for work due to situations such as illness, jury duty or maternity leave.
Shop managers, too, can estimate personnel and equipment requirements, although the figure might be thrown off by unforeseeable state regulators' inspections, accidents, weather and strikes.
The real culprits are the things you cannot control or plan - shifting or slashed budgets, new customer demands, etc.
And once everyone falls behind, there is little opportunity to catch up. Operators complain to the shop. The shop, in turn, counters that the operators are being unrealistic in their needs assessment and that they abuse the equipment to the point where it needs excessive repair.
It's easy to see how antagonistic relationships can evolve where none need exist. As always, there are two sides to this story, and understanding both perspectives is the first step to effective communication.
Fleet management requires the cooperation of both the operators (the customers) and the shop crew (the suppliers). Operators should have realistic personnel and equipment assessments when reporting needs to the shop. Also, they should know the historical record of how well equipment stands up over the course of the day.
Their estimated equipment requirements and related needs will vary by day and season and by the estimator's abilities. Daily vehicle requirements can be estimated by taking into consideration the: * tonnages set out on a given day;
* collection vehicles' capacities;
* distances trucks must traverse; and
* number of trips each vehicle can make within an eight-hour period.
Add to this amount the variables of how many drivers will report for work and complete a full work day, the probability of accidents/equipment breakdowns and repair turnaround time.
Finally, the operators must attempt to understand the shop's perspective.
That Shop Crew's Duties The fleet services crew have a finite amount of equipment in inventory in various states of repair/disrepair:
* some are unsalvageable and earmarked for disposal;
* some awaiting the delivery of vital parts; and
* others being held for required maintenance checks that cannot be deferred.
To complicate matters, heavy use has created repair needs on the remainder of the fleet.
The maintenance crew is plagued with problems akin to those experienced by the operators: personnel availability, unexpected service demands and budget restraints. In addition, the shop must contend with parts availability, inventory/quality control, aging equipment, inventory reduction due to accidents and lemon purchases. All these factors reduce job performance.
Good mechanics, like good operators, take pride in their work, take proper care of tools, and respect the other's roles, abilities and professionalism. And, both mechanics and operators get upset when co-workers are lax in their job performance.
Torn between ensuring that the operators have sufficient, reliable equipment and meeting the routine maintenance requirements, fleet managers must play a Solomon-like role in divvying up resources. No one is paying a fleet manager to invent excuses for why he can't get the job done.
Ultimately, the best operators work closely with the mechanics, keeping the shop apprised of problems, seeking the mechanics' counsel in avoiding downtime, ensuring the vehicle is clean and reporting problems promptly and in detail. Shop personnel appreciate recognition of their skills and are pleased when operators make an attempt to understand their problems.
Operators should consider mechanics as partners and keep the lines of communication open. Talk with - not at - each other and never yell. Look at each other's tasks and priorities to determine how best to work together. Promise to discipline problem employees on your own staff. Remember, you are not choosing sides. You are working together.
In addition, operators should take a closer look at the number of vehicles really needed and not add allowances for vehicles that are assumed to be marginally functioning. This allows shop managers to target a smaller number of vehicles to work on more thoroughly.
Buying Vehicles When purchasing vehicles, operators should give the shop staff their requirements and reasons why this equipment is needed. Mechanics, in turn, should write the specifications for the entire vehicle. Then, discuss any questions or changes together in a joint meeting. Key fleet management staff members should sit in on operational staff meetings regarding equipment.
Both groups are strengthened by the other's expertise. As mutual understanding grows, mutual respect and responsibility grows, as well. Don't try to do the other guy's job, but take to heart the old adage about walking a mile in the other's shoes. This will allow both departments to focus on the next important goal, turning the equipment mishmash into a coherent, focused fleet.
The landfill crisis of more than a decade ago brought solid waste issues to public attention and added a serious new line of "must have" equipment to the fleet repertoire: recycling equipment, a necessity preceded by automated equipment.
Diagnostic equipment and mechanic skills have been upgraded accordingly, and some operations have found that renting/leasing equipment and contracting their repairs to specialists makes more sense than buying equipment and staffing maintenance personnel.
Regardless of the format, though, one essential remains constant: Unless the people who operate the equipment are partners with those who keep it running, good fleet management doesn't exist.