Despite pleas from public, Sebastopol City Council dumps Recology for SCRR
Over a hundred people people spoke or submitted comments in support of Recology, but the city council voted 3 to 2 to drop it in favor of SCRR
Public comment went on and on last night at the Sebastopol City Council meeting—both in person and on Zoom—as resident after resident rose to speak about their admiration and love (that doesn’t seem too strong a word) for Recology, which has been Sebastopol’s waste hauler for the last 16 years. Comments took two hours, but in the end, it was all for naught, as the council voted 3 to 2 to ratify the contract with SCRR, Recology’s competitor.
All council members were present for the Jan. 7 Sebastopol City Council meeting, including Mayor Stephen Zollman, Vice Mayor Jill McLewis, Councilmember Phill Carter, Councilmember Neysa Hinton, and Councilmember Sandra Maurer.
The council room was crowded last night as the meeting began. Assistant City Manager Mary Gourley did a quick head count—52 people in the room—to make sure they weren’t exceeding the room limit of 60. An additional 78 people were on Zoom, she said.
Mayor Zollman asked for a show of hands of how many people were there to comment on the solid waste contract. Almost everyone raised their hands and some that didn’t ended up commenting anyway. (Who knew a garbage contract could arouse such passion?) Bowing to fate, Zollman moved the Solid Waste contract to the top of the agenda.
The reasoning behind the choice of SCRR
Garth Schultz of the consulting group, R3, gave a dense, text-heavy PowerPoint presentation at warp speed. This presentation is well worth perusing if you want to understand the council majority’s reasoning for choosing SCRR over Recology.
In brief, the city council developed a list of evaluation criteria, then R3 and the council’s Solid Waste Ad Hoc, consisting of Councilmembers Sandra Maurer, Jill McLewis and city staff, did their research and then scored each company on the criteria.
These scores would prove controversial as the evening wore on. Many commenters (and the Recology team) wondered how Recology, which is famous for its sustainability work and community engagement, could score less than SCRR? How, many asked, could Recology, a company owned by its union employees, score lower on community employment?
A question of money
The question of which company had the lowest rates seemed to weigh heaviest in the council’s decision-making.
“Taking all customers and all rate types into account, single-family residents came out ahead in the SCRR proposals,” Schultz said, noting that single-family residents make up 88% of the ratepayers in the city.
“With respect to commercial businesses, here again, SCRR proposed the lowest overall monthly rate,” Schultz said, noting there were around 318 multi-family and commercial customers in town.
The crux of the problem for commercial customers, however, was that, while a low base level of recycling and composting was included in their regular garbage service, SCRR’s rates for additional recycling and composting were far higher than Recology’s. Schultz estimated that about 20% of commercial customers could get by on the base rate, which included one 96-gallon blue bin for recycling and a 96-gallon bin for organic waste (i.e., for composting). Another 46% of businesses would need just one more bin to accommodate their recycling and compost needs, which Schultz estimated at an additional $60 a month. That left 26% of commercial customers, like Retrograde Coffee, Sebastopol Hardware and Screamin’ Mimi’s, facing steep rate increases. These businesses can expect to see their solid waste bills soar by 200-300% under the SCRR rate plan.
During public comment, Bill DeCarli of Hopmonk said that the restaurant’s solid waste bill was going to rise from $1,300 to $4,300 a month. “It is getting harder and harder and harder to have a business in this town. Businesses can only take so much,” he warned.
When Schultz suggested that SCRR could help businesses “right-size” their bins, Retrograde owner and Sebastopol Zero Waste Super Hero Danielle Conner, said in her comment that “For the consultant to suggest that businesses do not currently have the right size bins is an insult to our intelligence.”
Commenters suggested that SCRR’s high rates for additional recycling and composting endangered Sebastopol’s Zero Waste aspirations and even its reputation as an environmentally aware town. Schultz suggested that SCRR’s rates could be seen as an incentive to produce less waste in the first place, which would be an even better way of reaching the town’s Zero Waste goals.
“SCRR is suggesting downsizing dramatically, which is an impractical solution,” Conner said in response to this idea. “Our dumpster is full every single pickup. I put trash, compost and recycling in it myself multiple times a week.” Conner said that only 1% of the organic waste from her cafe goes into the landfill.
Several speakers, including Bronte Edwards, said they’d be willing to pay a little more as individual ratepayers to make sure local businesses could survive. “As a single woman in a small home, I would be willing to pay $20 more a month if it means that my friends can keep their restaurants and their cafes open,” she said.
Schultz explained that this kind of subsidization is now illegal due to Proposition 218. “It says that the fees for property-related services need to be proportionate to what it takes to provide those services,” he said.
“One of the things that’s at play here is that not charging for recycling or organics additional services requires that the garbage rates fund those, and that’s a subsidy from those ratepayers that don’t need additional services to those ratepayers that do need that additional garbage and recycling service,” Schultz said. “The key take home here is that this rate structure approach was designed specifically to keep the city in compliance with the proportionality requirements of Prop 218 and also avoid the perpetuation of the subsidy that was originally introduced into the city’s rate structure some time ago, prior to concerns around having rates fit with the cost of service.”
A question of values
Beyond the question of money lay the question of values, and it was clear that many public commenters felt that was being given short-shrift.
Sunny Galbraith, a longtime Sebastopol resident, high school teacher and environmental and labor advocate, said, “I am proud that in Sebastopol’s General Plan, Conservation and Open Space Goal 1:1 states, ‘Strive to establish Sebastopol as a leader in environmental protection, stewardship and sustainability.’ A vote by the council to end the contract with Recology goes against this and other goals of the General Plan and tarnishes our town’s reputation as a leader on environmental issues.”
“As a labor advocate,” she continued, “It would be a tremendous loss to lose an employee-owned union company and good jobs in our county. I’m very upset about that as a union member myself.”
And, indeed, a stream of Recology employees, all union members with the Teamsters and proud owners of the company, gave comments about what Recology has meant in their lives.
“This is what employee ownership means,” said Logan Harvey, Recology’s general manager, gesturing at the sea of employees in work clothes and fluorescent vests.
Schultz, the R3 consultant, responded that the city had considered this and decided that SCRR workers got similar wages and benefits to the unionized members of Recology.
The question of the companies’ integrity also came up. Recology has been found guilty of overcharging San Francisco ratepayers by $94.5 million, which they have been ordered by the court to repay. SCRR funded an effort to do away with competitive bidding in the city of Windsor—attempting to lock down their hold on the town’s garbage services. This effort was voted down by the citizens of Windsor.
The council weighs in
After two hours of listening to public commenters praise Recology and plead with the city to retain it as its waste hauler, the council members who supported SCRR had the unenviable task of trying to explain why.
“I wish each and every one of you who spoke to us tonight had done the deep dive, had done the interviews, had tried to negotiate with Recology,” Councilmember Maurer began. “I wish you had that experience, but you don’t. So you don’t know what that experience was like. I feel solid with our decision to go with SCRR ... Our goal was to obtain the best service at the best rates, and we believe, as an ad hoc committee, that we have done that.”
“If we had gone with what Recology had proposed'“—a 57% increase in rates—“we’d see a whole other room, plus more people, complaining about the 50% plus increased rates that Recology was going to impose.” Maurer continued. “I believe that SCRR will work with businesses to help right-size their containers and to work with them. I feel confident that they are going to do this, and if needed, I will help with this process as well.”
Maurer called starting from scratch and re-negotiating with Recology “a non-starter.” Her fellow Solid Waste Ad Hoc member Jill McLewis agreed.
“I wish all of you could have the same experience that we had [negotiating with Recology],” McLewis said. “It was disappointing, going back and forth, back and forth, back and forth, coming back to meetings and still having the same numbers and knowing that there was just no way that we could say, ‘Oh yeah, let’s go ahead and increase rates more than 50%.” … I do respect everyone here and what the decision is. but for me, I am solid. I believe that SCRR will work with our businesses. I’m a business owner myself. We have dumpsters. I fully expect that we’re going to have some kind of increase, but at the end of the day, sitting up here, I have to make a decision that’s best for everyone in the city.”
Mayor Zollman indicated that he too had decided to go with SCRR. He said he was persuaded by the argument that the rates would encourage businesses to not produce as much waste to begin with, but also, because city staff, whose opinion he respects, was also recommending going with SCRR.
Councilmember Hinton expressed her frustration with the process bluntly.
“Frankly, Recology freakin’ blew it—I’m sorry, a 57% [increase] was not okay, and we had to go out for an RFP. So we did that. I voted for it, and now we have the results of it,” she said. “I am super frustrated because I didn’t want to be here either.”
Then she lit into Recology for the company’s last-minute campaign to get the council to change its mind.
“You guys have been spreading flyers since Saturday to our business community,” Hinton said. “I mean, you put us on the front page of the paper! … I’m upset to say the least.”
While she said she had reservations about the current contract with SCRR, Hinton said she wasn’t willing to start negotiations with Recology all over again. She asked to delay the decision on the contract to get some clarity on her questions. Councilmember Carter asked for the same.
Ultimately the vote broke 3 to 2, with Maurer, McLewis and Zollman voting yes on the SCRR contract with a three-year rate increase phase-in (see below). Hinton and Carter voted no. The yesses carried the day, and with that, SCRR became Sebastopol’s waste hauler for the next 15 to 20 years.
Recology is a billion dollar company that is accustomed to being a monopoly and not being forced to negotiate or bid for a contract. The US Attorney’s office charged Recology and senior staff with bribery and fraud in San Francisco. The company paid a $36 million fine in 2021 and two executives were criminally charged. Recology has a perpetual no-bid contract in San Francisco.
Recology claims they were losing money on the Sebastopol contract they acquired from the prior vendor. Recology had the opportunity to negotiate last spring but believed Sebastopol should make up for their mistake and pay extra in the new contract. Who but a monopoly would propose such a ludicrous idea?
And now Recology launched a PR campaign to malign the potential new vendor and the City staff and Council members who worked on the bidding process. I think any reasonable person would be extremely suspicious of Recology’s campaign. I support the diligent work of City Council members Maurer and McLewis and city staff.
All in all, I believe Citystaff and Council came up with the right decision.