Trash and cash

Council moves forward on waste-hauling franchise deal, approves 2017-18 budget

Starting on Oct. 1, all residential waste-hauling accounts in Chico will be assumed by Waste Management.

Starting on Oct. 1, all residential waste-hauling accounts in Chico will be assumed by Waste Management.


One morning a few years ago, as a waste-hauling truck rumbled toward his home, Chico City Councilman Randall Stone hurried to pull his family’s refuse bins to the curb. But the truck didn’t stop to pick them up, he recalled.

“The driver of this company looked at me and drove on by,” he said. “I was 5 feet from the curb. He was sending me a message.”

Stone didn’t say whether the driver worked for Recology or Waste Management—the two waste-hauling companies serving Chico. He did switch to the other one, however, and he’s been happy with the service ever since. That’s why he said the city’s proposed waste-hauling franchise agreement leaves a bad taste in his mouth: Under the new deal, residents and business owners won’t be able to choose between companies.

Even so, Stone voted along with a majority of the council to move forward with the franchise agreement on Tuesday (June 6). The council apparently was swayed by the deal’s upsides—namely, mitigating wear and tear on Chico’s streets, reducing greenhouse gas emissions and infusing city coffers with much-needed cash.

For many years, Recology and Waste Management have competed for residential and commercial accounts in an open market. As a result, any given street in Chico is lined with customers of both companies, making for an inefficient system that beats up the city’s already battered roadways. Fully loaded trucks can weigh as much as 57,000 pounds, said Ryan West, district manager for Waste Management.

“There will be real savings, in terms of what’s happening to the streets,” he said.

Under the 12-year franchise agreement, Waste Management will handle all residential accounts and split the commercial ones with Recology. Pickup rates will not immediately change, though they could increase by 5 percent annually starting in July 2018. In turn, the haulers will pay the city 10 percent of gross revenues—totaling an estimated $800,000 more in annual fees—which will go toward the general fund.

When the floor opened for public comment, speakers Stephanie Taber and Michael Reilley urged the council to earmark the funds for road maintenance.

“Give it to the roads so we get something back,” Reilley said. “It’s the users who are paying for it. … This is coming out of the community’s pocket.”

The council will decide how to spend the franchise fees during the next budget cycle, when city staff knows exactly how much revenue is coming in, City Manager Orme told the CN&R after the meeting.

From the dais, Councilwoman Ann Schwab expressed concern with the system for filing complaints. When Butte County adopted a similar franchise agreement in 2015, many customers had frustrating and unhelpful interactions with Waste Management’s national call center, according to the CN&R’s archives.

Orme argued that the franchise system will hold the haulers more accountable to the public.

“The [companies] want to show they are worthy of hauling our refuse,” he said. “There’s an extra incentive under a franchise agreement. … They want to be renewed.”

Schwab made a motion to approve three ordinances allowing the city to implement the new system, which was seconded by Mayor Sean Morgan and passed by a 5-to-2 vote. (Councilmen Karl Ory and Mark Sorensen dissented.) The ordinances will come back to council for a final reading in July.

The franchise agreement was originally set to take effect July 1, but the date has been pushed to Oct. 1 to give the haulers more time to inform customers about the changes.

Also Tuesday night, the council approved the city’s $49.5 million budget for fiscal year 2017-18, despite a general consensus among members that it has major shortcomings.

For instance, as the CN&R previously reported, it would take $7 million annually to maintain the current condition of the city’s streets and an additional $3 million a year to make significant improvements. But the 2017-18 budget earmarks only $1 million for road maintenance.

Also, as part of the city’s ongoing effort to rebuild the Chico Police Department, the budget includes the addition of three police officers—two for traffic enforcement and one school resources officer—but no such windfall is forthcoming for the bare-bones fire department.

“It is a deep concern to me that we didn’t find that money,” said Vice Mayor Reanette Fillmer.

Ory was concerned with losing retailers and dwindling sales tax revenues, citing the recent announcement that Sears will close its Chico location later this year (see Downstrokes, page 8). He also took issue with cuts to community organization funding, which decreased from $100,000 to $50,000 compared with last year, to help pay for more police staffing.

As for the long-term outlook, it’s difficult to see how the city will meet its skyrocketing CalPERS obligations in coming years, Stone added.

“I cannot support this budget,” he said. “It’s still deficient.”

The council voted 5-2 to approve the budget, with Councilman Andrew Coolidge and Stone casting the nay votes.