Re: Separate Landfill Contracts so mergers don't slow recycling
Wed, 14 Apr 1999 14:23:40 EDT


I'm surprised at your pessimism about the role of independent haulers in the

If WMI and Allied have about 50% of the market, where is the rest of the

If WMI, Allied and other multinationals have to get 30-35% ROI to be
"profitable" for Wall Street, and independents would be satisfied with
10-15%, then there seems to be a huge opportunity for independents to grow.
If cities continue to require aggressive recycling services be provided, then
partnerships of waste haulers and reuse, recycling and composting companies
should be able to compete well.

If cities separated their long-term garbage disposal requirements from their
garbage and recycling service requirements, they could stimulate this type of
entrepreneurial activity.

Once again, it's up to localities to define what is economic for the private

Gary Liss
Fax: 916-652-0485

In a message dated 4/12/99 2:49:35 PM Pacific Daylight Time,

<< I don't think cities will provide much help in preserving free enterprise
recycling. As a (perhaps) unintended consequence of AB 939, cities
throughout the state have forsaken their home-grown waste removal companies
and small recyclers in favor of contracting out to large national firms with
headquarters elsewhere. These firms have spent the 1990s lobbying city
councils, warning that only large companies could guarantee cities meet AB
939 recycling levels of 25% by 1995 and 50% by 2000. Revenues derived from
waste hauling, landfilling and the marketing of recyclable materials are
leaving California for corporate headquarters in places like Illinois, Texas
and Arizona.

I doubt this trend can be reversed now. There aren't enough small haulers
left to give the big nationals a run for their money and even if they could,
most city councils, afraid of AB 939 monetary sanctions, wouldn't give them
the opportunity.