Outsourcing A ‘Pot Of Gold,’ Also Known As The City Dump
Wednesday, September 29, 2010
Trash is big business in the United States. And the city of San Diego wants to see if it can cash in on some of that trend by outsourcing the operation of the Miramar Landfill.
SAN DIEGO Trash is big business in the United States. And the city of San Diego wants to see if it can cash in on some of that trend by outsourcing the operation of the Miramar Landfill.
There’s only a small section of the Miramar landfill that actually looks like a dump, with bulldozers moving around piles of trash and debris. But the rest of it looks pretty atypical of what you might expect. There’s a large section devoted to creating mulch and compost that people can buy for their yards. And there are hardly any birds flying over head.
In fact the landfill works hard to scare birds off since it’s located just under the flight path of Marine Corp Air Station Miramar. The city leases the landfill space from the Department of Defense. It’s San Diego’s only city-run landfill and it collects nearly a million tons of waste a year. Miramar has changed the way it does things over the years in an effort to become more environmentally friendly.
Stephen Grealy is the Deputy Director of Waste Reduction and Disposal for the city. He said the landfill now diverts more than half of the waste it receives through recycling efforts.
"Originally the Miramar Landfill was slated to close in 1995. Right now we’re looking at 2022 because of innovations like this. Because of our recycling programs and our recycling ordinance that we have in place," he said.
Exploring the possibility of outsourcing operations at Miramar is one of 10 fiscal reforms linked to a proposed sales tax increase on the November ballot. The landfill generates $31 million a year in revenue. About $20 million of that goes to cover the cost of running the landfill, and the remaining $11 million is spent on other things, such as industrial recycling programs, code enforcement and maintaining closed landfill sites around the city.
The city wants to see if there’s a cheaper way to run Miramar.
Miramar Landfill RFQ
Murtaza Baxamusa is with the Center on Policy Initiatives, a local think tank.
"Miramar Landfill is a pot of gold for trash," he said. "It has a captive audience in the county residents that need to dispose of their trash. It is centrally located and it is already environmentally entitled."
Baxamusa said the city may be rushing into something without considering the full implications. And he said it’s unclear whether a private company would be required to keep supporting the additional services that the revenue from the landfill pays for. Baxamusa said the land is extremely valuable and the city should hang on to it for dear life. But San Diego likely knows that with landfills being so hard to build these days Miramar could be a very rare and profitable commodity to the private solid waste industry.
Thom Metzger is with the National Solid Waste Management Association. He said the industry is worth $50 billion a year nationally and is growing. So are the opportunities to make money.
"(We) are looking at ways to manage waste smarter, more efficiently. Recycle more, compost more. And every step of that process opens up more avenues of making money for private companies," he said.
Companies make money primarily by charging tipping fees to trash trucks and citizens who drop off their waste. San Diego pays more than $10 million a year to dump its trash at Miramar. But money can also be made selling methane gas created by decaying trash. The gas is used to create energy. Down the line Miramar could also be used as a transfer station to ship trash to other landfills.
Ernie Anderson is a former Director of General Services for San Diego where he ran trash and recycling collection. He said innovative management ideas have extended the landfill’s life. But he doesn’t fault the city for looking into privatization.
"The mayor in this instance is doing exactly what he ought to do. He’s exploring every possibility to see if we can save money," he said.
But Anderson said it’s important to write a tight contract in the event the landfill management is outsourced. And he points out that city employees will still be involved even if the landfill is outsourced.
"Those same city employees are going to be the ones that going to be monitoring the contract. So you're going to end up spending a lot of money if you don't have competent people monitoring the contract and if you don't have an ethical company that's providing the service," he said.
The mayor’s office won’t say if it’s going to go through with the outsourcing option. City representatives wouldn’t comment on any possible deals for this story except to say they hope to know by November or December whether one will get done.