every-other-week schedule. Our own workforce collects the residential solid waste weekly using the same 90- and 95-gallon carts that we had been using since the late 1980s with semi-automated vehicles. The residential solid waste is dumped at our own transfer station, operated by the private contractor. This material goes to the landfill. The mixed recyclables are taken to a new sorting facility, owned and operated by the contractor, where the various materials, newsprint, mixed paper, aluminum, glass, etc. are separated, baled and sold to various markets. There were three major reasons for privatizing the collection of recyclables. First, the cost of separating the blue bags from the regular waste stream was skyrocketing. The price per ton was better than double the price per ton for landfilling. The company was pushing to get out of their contract to sort the blue bags. The City did not receive any money back from the recyclables in the blue bag method. With market prices for recycled material on the rise, the City wanted to change the contract to reap some of the benefits of the rising prices. The second reason is the City had been considering moving to fully-automated collection of solid waste for a long time. Our municipality is a first-ring suburban city, neighboring a major metropolitan area. It has quite a mix of housing and lot sizes. But staff foresaw several problems associated with fully-automated collection. The waste company has run into several of the problems. Narrow alleys with tight turns, cars parked in front of the carts, or carts not being placed in an accessible location are just a few. We are letting the private contractor provide us with solutions to these problems before we invest in new equipment. The contractor began the collections using a frontload vehicle, modified with a grabber arm and a container. The contractor plans to purchase new equipment in the third or fourth quarter of the year. In the meantime, they have had to bring a third, smaller vehicle in every other Friday in order to collect 50
APWA Reporter
April 2009
the carts in the narrow or dead-ended alleys because their frontload vehicle is too large to make some of the turns.
service than the contractor. It will be interesting to see what role the cost of the service will play in future decisions.
Thirdly, privatizing the collection of the recyclables gives management a clear costing benchmark for collection services on which to base future decisions regarding the fully-automated collection of regular solid waste.
Summary
While we are only five months into the single stream recyclable collection, our residents have drawn conclusions that the private collection service does not offer the same level of service as we do with our own employees. Everything to be recycled must be placed inside the container including items such as large cardboard boxes which our residents are used to just placing next to their containers for collection. The recycling containers also need to be placed properly at the curb or alley line, since the operator of the automated vehicle does not get out of the cab of his truck. This has been a problem in alleys where residents were used to just leaving their carts where they were stored for collection. At about 50% of the homes that have alleys (this is only a small fraction of our city), the resident needs to physically move the container on the proper collection day in order to ensure a collection. On the positive side, the revenue from the sale of the recyclables coming back to the City has continued to increase each month. While it does not entirely offset the cost of the collection, there is no tipping fee for the recycling tonnage and the City has begun to get back between $50-55 a ton for each ton collected. This example points out the importance of not only considering the service that may be privatized, but also the level of service. While I have considered automating the regular solid waste and reducing the workforce through attrition, I expect this may not be acceptable to all our residents after their experiences with the recycling containers. There is no question in my mind that the City workforce offers a higher and indeed expected level of
Over the course of my career in public works, I have found it advantageous at different times to privatize some public services, deprivatize others, and to employ various hybrid arrangements. In my experience, the wisdom of privatizing the provision of a good or service depends on the circumstances. As you have seen in the examples above, it may make sense to do the work using your own employees in some settings or it may make sense to privatize some or all of it. For each service being recommended for a shift, a complete cost-benefit analysis was performed. The pros and cons of taking work back in-house or privatizing work were thoroughly examined. In all of the examples shown above there was also a labor union to deal with. While not the case in every municipality, this is one important step that cannot be overlooked. The local union is well aware of the fact that I have added jobs as well as eliminated them depending on how efficient and cost effective our own workforce can be. I have always communicated my intentions to them prior to taking the final steps in the process. No surprises! Both management and the labor union try to operate under this type of a communication policy. The labor agreement does contain a clause that allows for contracting out services but only if no one is laid off. The final decision makers are the elected officials. One must be very clear when presenting cost-benefit analyses of these sorts if one expects to get a positive recommendation. By the way, it also is a good idea to follow up in the middle or at the end of the year as to just how the effort is working out. It is important to provide this information, even if it shows that the change may not have been a good one. William “Bill� Kappel is the Director of Public Works for the City of Wauwatosa, Wisconsin. He is a member of the Public