Today's Topics:
Compost Operator's Advanced Topics Seminar to feature Elaine Ingham
Merger of USA Waste and Waste Management
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--- Loop-Detect: GreenYes:98/251 ----------------------------------------------------------------------Date: Wed, 25 Nov 1998 10:48:07 -0500 From: mappelho@madison.tdsnet.com (Mary Appelhof) Subject: Compost Operator's Advanced Topics Seminar to feature Elaine= Ingham
Compost Operator's Advanced Topics Seminar to feature Elaine Ingham
If you've ever heard Dr. Elaine Ingham speak, you seek other opportunities to hear her. Why? Because she can never get everything she has to offer into one presentation. At least that has been my experience. Although I met her only a year ago, I have heard her six times ranging from Seattle to Kansas City to North Carolina, and eagerly look forward to her coming presentation in Ann Arbor Friday Dec. 4, 1998.
Elaine's focus is on the soil foodweb. She has done more to develop understanding about how bacteria, fungi, protozoa, microarthropods and nematodes in healthy soil interact to free up nutrients for plants than any other person around. She has a quality rare for an academic, she can talk in language we can all understand. She makes it fun, and she makes it stick. (Well, after a few repititions, perhaps.)
According to Ingham, Associate Professor at Oregon State University and founder of Soil FoodWeb, Inc., "If we get health back into the soil you no longer have to add pesticides, fertilizers, or insecticides. You can even drop herbicide applications out of the system. How do you get health back into the soil? Compost. Good compost."
So how do you make good compost? Find out from Elaine Ingham herself at the Michigan Compost Council's Advanced Topics Seminar 8:30 am-4:00 pm, Friday, December 4, 1998, at Weber's Inn Conference Center in Ann Arbor, Michigan. Fee for non-members is $135, for members, $100. Registration is through the Michigan Recycling Coalition, 517-371-7073, FAX 517-371-1509. Registrations prior to Monday, 3:00 pm, November 30 will guarantee lunch.
Here's a chance for those of us here in the midwest to hear her. If you don't get to come, at least take a look at her website at: http:www.soilfoodweb.com
Hope to see you there.
Mary Appelhof
Mary Appelhof Flowerfield Enterprises 10332 Shaver Road Kalamazoo, Michigan 49024USA Phone: 616-327-0108 FAX 616-327-7009 Email: mappelho@madison.tdsnet.com
See a baby worm hatch from its cocoon at http://www.wormwoman.com
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Date: Wed, 25 Nov 1998 10:13:15 -0600 From: "RecycleWorlds" <anderson@msn.fullfeed.com> Subject: Merger of USA Waste and Waste Management
On July 16, 1998, the US Department of Justice entered into a proposed settlement with USA Waste and Waste Management approving the merger subject to the divestiture of certain collection, transfer and landfill assets in 20 geographic markets. Under the Antitrust Procedures and Penalities Act, however, the proposed Consent Decree codifying that agreement does not take effect until after DOJ provides notice of the proposed settlement in the Federal Register and accords the public 60 days for comment. The Federal Register Notice occurred on 9/24/98 (p. 51126), meaning that the comment period extended to yesterday, 11/24/98. We submitted 20 pages of comments. To avoid belaboring this general list with all of that, I have excerpted only the section dealing with the potential impacts of the merger on recycling and the remedy which we propose. If anyone would like a copy of the full set of comments, please let me know by email including whether you use Word or WordPerfect as your word processor so that I can provide it as a file attachment that you can read.
EXCERPT FROM COMMENTS BY RECYCLEWORLDS CONSULTING ON MERGER BETWEEN USA WASTE SERVICES AND WASTE MANAGEMENT
2.2 Recycling Will Also Be Impacted
The Competitive Impact Statement contains the statement that "there are no good substitutes for disposal of MSW." CIS, at p. 8. In the short term this is true and provides further undergirding =97 if= any were necessary =97 for the government's insistence on some limited divestitures. However, in the mid to longer term it is not entirely accurate. Just as energy conservation soared with the OPEC price increases for oil in 1979, as the price of disposal increases, the customer's desire to find ways to divert his waste flow from overpriced disposal options will tend to increase, most particularly through source reduction, reuse and/or recycling. Recycling is estimated to have diverted upwards of 30% of the municipal waste stream, and more in some markets. This has been a significant contributory factor, in addition to overbuilding, in the present excess capacity situation for disposal that presently exists in parts of the country. Were monopoly rents to be imposed on waste services, then it could be expected that the customer will tend to pursue recycling efforts more. The prospect of increasing diversion rates would create a tempering force on the market power of integrated waste firms. This fact is known to the members of the oligopoly in waste services, and it is not reasonable to expect them to forgo countermeasures. The question here is whether the members of a waste oligopoly that is permitted the Justice Department has not yet determined to prevent could act to effect recycling negatively in order to avert that threat to their market power. There is no parallel bottleneck, such as landfills, in the market for recycling. However, for three reasons, a oligopoly in the market for waste will tend to "naturally" extend itself to recycling. 2.2.1 Combined Contracts Many franchise contracts for residential trash collection will be bid out combined with recycle collection for ease of administration. If your competitor can offer combined service and you cannot, you will be out of competition. Similarly, many large and small commercial customers will want to consolidate trash and recycle collection in one hauler. 2.2.2 Synergies Also, there are very substantial synergies from combined waste/recycling services. Recycling diverts waste from the trash truck and from the landfill that makes possible avoided waste collection and disposal costs. These very substantial savings that can offset as much as one half of the cost of waste services will be lost by a recycle-only firm. This will make it more difficult if not impossible for a recycle-only hauler to compete with a combined operation, because it will not realize those offsetting savings on the waste side to reflect in its recycle-only bid. 2.2.3 Consolidated MRF's There is presently ongoing extensive consolidation in the material recovery facility market. KTI is engaged in an extensive consolidation effort among MRFs, including the recent takeover of a competing consolidator, FCR, and with both acquisitions, will own 25 MRFs in 14 states. Their statements to investors indicates that they intend to market successfully to national hauling firms who want a consistent partner. If the MRF consolidators succeed (which is not certain as evinced by the bankruptcy of Prins in 1996), one element in their market plan will be to partner with recycle collection operations of the national firms. This will make it very difficult for them to offer favorable terms to a competing non- integrated recycle hauler who is challenging the waste oligopoly.
3.0 Divestiture of Disposal from Hauling is the Appropriate Remedy The facts described in this submission clearly demonstrate that the remedies contained in the Consent Decree are inadequate to protect competition in the solid waste industry in those geographic markets in which there is no disposal capacity owned and operated by a public body or by a company that is presently independent of the major integrated waste firms and unlikely to be acquired by them in the near term. Only a dramatic remedy can respond adequately to such a concerted and effective strategy to monopolize the bottleneck landfill market within 1=BD to 2 years in those geographic markets which will not have uncontrolled disposal facilities. The remedy which is within the power of the Justice Department under Section 7 of the Clayton Act is to require the divestiture of all disposal capacity including landfills, incinerators and transfer stations from hauling in geographic markets in which there is no disposal facility owned and operated by a public body or company independent of the majors that will continue to operate for the near to intermediate term. (The other remedy outside of Justice's authority is utility-style regulation of landfills.) This is fundamentally different from the Consent Decree which permits vertical integration by WMI, and the other majors which form the oligopoly, in those geographic markets so long as the post-merger market concentration for disposal (and for collection) does not increase. Much argumentation in support of consolidation has been made that there are efficiency gains from size in commercial hauling =97 note that this ignores residential hauling most of which is already under franchise. We have done studies that have corroborated the fact that gains can be achieved in this regard, albeit not anywhere to the degree alleged. Also, the ability of the customer to realize these savings in a one or two hauler town is problematic. But, that debate is not relevant to this remedy since this outcome does not involve divestitures from within the market for collection. For no contention has been raised that the cost of providing waste services to the consumer will be lower due to vertical integration of hauling and disposal. And there is none. Internalization, as the industry refers to the practice of discarding trash loads at its own landfills, has been related to improved profitability through market power, not capital or operating efficiency. Indeed =97 and this devastates any future claim to the contrary =97 the fact of, and justification for, the recent volume exchanges demonstrates graphically that internalization is not the same thing as efficiency. A non-integrated, free standing landfill industry will also have the additional benefit of increasing competition in the market for disposal, especially in the current era in which transfer stations, which have become the norm, make the incremental cost of further haul distances in search of lower tip fees less significant. They will also preclude the use of reverse squeezes. If that remedy is not selected, then, at a minimum, the new Waste Management should be required to disclose the terms of the bids on its assets, and, after opportunity for supplemental public comment, the limited divestiture should be sold to firms, if any exist among the bidders, not among the firms showing cooperative behavior (i.e. Waste Management, BFI, Allied, Superior, Eastern, Waste Industries, Waste Connections and Casella). ____________________________________ Peter Anderson RecycleWorlds Consulting 4513 Vernon Blvd. Ste. 15 Madison, WI 53705-4964 Phone:(608) 231-1100/Fax: (608) 233-0011 E-mail:recycle@msn.fullfeed.com
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End of GreenYes Digest V98 #251 ******************************