Local governments turn monopolies loose on public without grievance process

This vacant Spanish Springs Valley home was under a lien because no one paid the bill to have trash not picked up.

This vacant Spanish Springs Valley home was under a lien because no one paid the bill to have trash not picked up.

Photo/Dennis Myers

The house in the Spanish Springs Valley could not be neater. One gravel driveway appears to have been carefully combed. A concrete driveway is so clean it might be eaten off. There are three vehicles on the property, but they are all out of sight. It’s ready to sell.

Power and gas meters do not appear to be turning over at all. No one lives in the house and the owner lives out of state, so it is alarmed. There are two metal posts in the front yard that appear once to have held a real estate sign. It came down because the home can’t be sold.

The home belongs to Dean Barnett, a California resident. It belonged to his mother. After her death, he put the property in its current impeccable state.

“Mother passed away at the end of 2011,” he said. “It’s been vacant ever since.”

So he was taken aback to learn in May that Waste Management Inc. (WMI), which handles trash collection in the county, put a lien on the property for unpaid collection at the property. Since there has been nothing to collect for several years, he was disinclined to pay. But how to deal with the problem wasn’t easy to figure out.

WMI has agreements with Washoe County, Sparks and Reno to provide exclusive trash collecting service in each of their jurisdictions. Its agreements with the local governments give it monopolies in each of their territories, both on service and on the trash bins—residents cannot buy their own and thus save monthly rental fees.

Unfortunately, in the process of turning these monopolies loose on the public, the local governments did not set up any regulation to give residents somewhere to go for help if the corporation gets out of hand. There is nothing like an appeals process or independent administrative grievance procedure.

“Not necessarily, no,” said Reno environmental specialist Jason Geddes.

“It’s just the ombudsman” that customers can turn to, he said. That’s not a city ombudsman. It’s a corporate ombudsman. There is no independent scrutiny of WMI conduct.

Barnett obtained a copy of WMI’s agreement with Washoe County, which was adopted 14 years ago. He said he believes WMI is “not following the franchise agreement,” but it appears there is no way to pursue violations of that agreement short of going to court. Waste Management spokesperson Sarah Polito did not respond to a request for comment. Barnett said he engaged in lengthy discussions with WMI officials until “I think they realized I was not going to go away.” He twice presented copies of his mother’s death certificate to them and passed up one sale of the property because of the lien. He also insisted that, according to the franchise agreement, a customer could halt service to a vacant property simply by notifying the corporation. WMI, he said, was exceeding its authority under the agreement.

Finally, WMI lifted the lien.

Geddes said a resident may be able to prove a building has stood vacant by showing that utilities have not been in operation or other such means. That would put a property owner in the position of having to prove her case instead of WMI proving its case.

Not only is the burden apparently on the customer, it also appears that it’s not all that uncommon for people to be taken by surprise to learn that they are being billed for service they didn’t know they were getting. During research on an earlier story by the RN&R on WMI (“Issues with trash,” Sept. 5, 2013), a clerk at the company’s Holcomb Street office was heard telling a complaining resident, “We are not required to inform you when we provide you with service.” The tone of voice and rote delivery of the sentence indicated it had been spoken many times before.

In all three jurisdictions, residents are forced to use WMI service, and no other. In the Sparks franchise agreement, for instance, “all third party providers” are banned. It also defines types of trash and, to prevent people from providing their own service, prohibits transport to landfills of some types of trash by residents.

Specifically, Sparks prohibits residents from taking “animal and vegetable waste resulting from the handling, storage, preparation, cooking, sale and serving of food and beverage … offal, swill, kitchen and table waste, and other organic animal or vegetable waste … bottles, cans, cups, plates, utensils, containers, and/or covering of any construction or material that has been in intimate contact with food, confection and/or beverage … any component used in the preparation or manufacture of matter intended for animal or human consumption, and … such matter and/or materials listed in subsections C(2) and C(3) of this section that have been discarded without first being sanitized” to the dump.

“The free market is based on competition,” said economist Glen Atkinson. “If government removes competition it needs to create regulation to protect consumers. … I can’t speak for all economists, but it seems to me that consumers should be able to go somewhere with their concerns about quality of service and rates and so on.” Local governments, he said, haven’t done a very good job of providing that kind of independent help to customers of trash collectors or cable companies.

In Reno, City Councilmember Jenny Brekhus—one of several relatively new members of the council—said, “I would say that last year, 2013, I spent more time on the Waste Management rollout than I did on any other issue in terms of constituent concerns.”

But 2013 was an unusual year. The city had just put in place a new franchise agreement that introduced a new and complicated recycling program. That start-up did not give Brekhus and her colleagues a good look at what normality is in terms of resident complains on trash collection.

Once the rollout of the new program started to recede, Brekhus said she started getting mostly specific complaints about the program, such as “the cart selection, that kind of thing.” She said she anticipates a lot more complaints when leaf-raking time comes in autumn. As for major problems like liens on property, she said the city has administrative grievance procedures for its own city-run programs, like sewers.

“Well, we have administrative hearing officers for a lot of disputes like traffic tickets, sewers, but those kinds of arrangements are not, to my knowledge, in place on the franchise agreements. … We do have it for our own enforcement.”

The new franchise agreement between WMI and Reno was approved by the old council the week before Brekhus and three other new councilmembers took office.

Making changes in franchise agreements isn’t all that easy. They are made for long periods. The county/WMI agreement has been in place for 14 years. Reno’s new agreement is for 17 years.

“It’s the law you have to have garbage service,” Barnett said, describing the municipal code that creates monopolies for business.

But there’s no law for customers.