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The Case for Decentralized Recycling
In this episode, host John Farrell, ILSR’s Energy Democracy Initiative Director is joined by Neil Seldman, ILSR’s co-founder and director of the Waste to Wealth program, to discuss how convenient single-bin recycling may have made things easy for the consumer, but harder for cities to capture the economic benefits of recycling.
Recently, China made good on a promise to stop accepting U.S. recycling due to the low quality of materials. The problem has been exacerbated by consolidation. Four giant waste companies, profiting more from disposal than recycling, control half the market. The combination of contamination in the bin and poor processing practices by industry giants means missed opportunities to grow local economies.
Although the Chinese embargo shocked the industry, Neil explains how this turn of events is an opportunity. Cities can redesign waste handling systems to recover cleaner glass and plastic, support local jobs, and provide raw material for local industry. How can communities move towards a decentralized recycling system and capture more value from their waste stream? Tune in to find out!
The cost of solid waste management, in the United States, because of these large companies is 30% higher than it should be.
Related Resources
Transcript
John Farrell:
We’re talking this week with Neil Seldman. He’s co-founder of the Institute for Local Self-Reliance, the director of The Waste to Wealth Program, which has for decades now been helping communities capture more of the value on their waste stream. Neil, I’m just so glad to be able to talk to about this because obviously I already took up half of a staff meeting trying to ask you questions about it, so thanks for taking the time to share with the rest of the world what’s going on in the recycling business.
Neil Seldman:
Sure, my pleasure.
John Farrell:
I just had to say, what got me so excited about talking to you about this was, as you have said, as so many of us talk about and the issues we work on, these are often inherently local issues but waste disposal is more inherently local than just about anything. But it’s actually something that China changed recently, way on the other side of the world that has put recycling in the news. And so I was hoping you could start by just explaining what did China change about its recycling policies that is impacting recycling at the local level across the United States?
Neil Seldman:
Okay, for the last let’s say 20 years, China has been purchasing recyclable material from the United States and using it in its industries. The markets in China were extremely tolerant, meaning that US cities and waste companies could ship recyclables that were contaminated, sometimes up to 40% with either things that aren’t recyclable or the process of single-stream recycling, wherein all recyclables are mixed in the same bin, they get transferred in the same truck and then transferred once again to larger trucks and overseas shipping, the glass breaks, the glass contaminates, glass shards contaminate plastic and glass. Around 2013, China announced that they were going to start cleaning up their industry and they did not want to receive contaminated recyclables from the United States.
One of the reasons is environmental but the other is economic. Labor in China has been increasing in cost and the Chinese figured, why should they pay to clean up US recyclables? So over the next few years, they kept on restricting more and more imports from the United States of single-stream material, and in 2007 they announced a very strict policy in which they literally stopped taking US imports through a variety of means. They stopped issuing permits, they started requiring inspections in the United States then doubling inspections back in China, they limited the number of ports that the materials can come in. And the bottom line is that they in effect cut off purchasing sloppy recycling or single-stream recycling. And as a result of that, it really threw US cities for a loop because all of a sudden the market for contaminated recyclables disappeared.
Cities that use single-streams … Excuse me, double stream systems, dual stream systems in which the paper is kept separate from the other recyclables, those materials are cleaner and moving to markets. In fact, the Chinese have not banned US recyclables from the United States, they just banned US recyclables that are contaminated. And what’s happening now is that US firms, Chinese firms mostly and other foreign companies are purchasing facilities in the United States. Some companies, Chinese companies are building their own facilities to process the plastic in the United States into pellets, very clean materials that are what we call furnace ready, meaning the manufacturing company that imports this has the material when it’s ready to go into their manufacturing process.
Orders for plastic pellets from China are soaring and the same thing is happening in paper. Chinese and other foreign investors are building and purchasing US paper mills so that they can collect paper in the United States, the US recycling stream is very, very rich in good materials, and sending over either fiber or finished paper back to China for internal use. At the same time, the Chinese are starting, just starting to recycle from inside their own industry and economy and that is a very slow process. We’ve been following what’s going on in Chinese cities and the recycling programs and composting programs are in their nascent stages.
John Farrell:
Sure. I want to take a step back here because when you talked about single-stream, I think this is something you just published a piece about, sort of Untangling the Waste Knot and you were talking about some of these contributing factors to why China in 2017, last year really clamped down on the US sending sort of dirty recycling materials. Single-stream recycling just for folks that aren’t familiar, that’s the idea that I have one big bin that I can put all my recyclables in. And the theory behind it was, this makes it easier for customers to recycle so they’ll recycle more, but can you explain a little bit about why single-stream has first of all been a problem in terms of the materials we get. In fact, you actually wrote in that piece, “Single-stream recycling has given households another garbage can.” So I think pretty clearly a problem. But then also explain, you talk a little bit more in the piece as well about how this contributes to consolidation of the different market players in the waste industry which is something I think many people won’t understand.
Neil Seldman:
Let me start by recalling how you started this interview by pointing out that garbage collection and recycling is inherently local. It is inherently local, and up through the 1950s, garbage which is a local responsibility for either the city or the county was small mom-and-pops, collecting garbage, bringing it to landfill or transfer facilities. The economy of scale of a successful company was maybe five to 10 trucks with drivers, crews of course, office people and it was very profitable. And as people who know US history, many immigrant waves went into this business, garbage collection and as a result of American capitalists just not thinking it very important. Well, it turns out it’s quite important. And starting in the late 50s, early 60s, there were three waves of consolidation.
And what consolidation meant was not increasing the economy of scale of operations but centralizing ownership, and this happened through massive influx of capital to a couple of companies that then started buying successful smaller companies, so that now we have the four companies that dominate the national scene. Probably 50 or 60% of the market for hauling in landfill belongs to four companies. The two biggest ones are Waste Management Inc and Allied. What these companies have done is to convince cities through bargaining, lobbying, all kinds of cajoling to switch from dual stream to single-stream to make it easier for them to collect the materials. And they went this way because US citizens changed the rules for recycling.
Citizens passed laws making recycling mandatory, requiring all kinds of new regulations to support and nurture recycling. And the waste companies immediately had to switch to recycling in order to keep their contracts, and the contracts were important because market share is critical for increasing your profits not necessarily efficiency but increasing profits. And as a result, the concentration of capital allowed the large companies to buy up smaller companies, convince cities to go to single-stream which means a big investment in capital, and then ship the recyclable materials to centralized processing centers called MRFs, material recovery facilities that are far out of town. So the centralization of collection and then large processing plants allowed the industry to dominate recycling. And prior to that point, recycling was seen as an escape valve from the control that these companies had over garbage.
And as a result of that, we have companies in charge of recycling that really don’t like to recycle because they make so little profit. Last few years they’ve actually been losing a little money, whereas on the landfill side, some advisors we talk to, point out that profits at landfill are in the 60-70% range and profits in the recycling area are marginal. And in fact, recycling is a marginal part of these companies businesses, and their interest in recycling is mass throughput not quality, and that’s why we had … the result is single-stream collection, sending materials to concentrated large scale processing plants whose purpose is mass throughput not quality recycling. In that piece I point out that single-stream recycling can be very, very effective and I use to examples one in Boulder, Colorado run by Eco-Cycle, a grassroots company. And the other in Twin Cities, Eureka, another grassroots enterprise.
Those companies operate mass material recovery facilities that maybe … Range of 200-300 tons per day, whereas the large centralized facilities that are located out of town are processing 900-1,000 tons per day. And there was a wonderful example of this a few years ago in Wilmington, Pennsylvania where a private entrepreneur built a composting plant scale to 300 tons per day of separated organics. They were operating well, the owner made the mistake in my opinion of accepting an investment from Waste Management Inc and he proceeded to lose control over the company. As soon as Waste Management Inc got control of the company they scaled up the plant to 600 tons per day to get more materials through to collect more tipping fees. The result was that the system broke down, composting did not work under those conditions, the place started stinking and within six months the place was closed down by the Delaware Department of Natural Resources. And there was no effort to fix the plant, Waste Management Inc just abandoned it.
And it led to a lot of speculation that the investment by Waste Management Inc was done on purpose to shut it down, because Waste Management Inc, when stuff is composted, it’s not landfilled and they lose profits. That is an allegation. That’s logical given what we’ve seen what big waste has done, pushing incineration, pushing single-stream recycling, pushing mega-mass and mega landfills. So the efficiency in recycling and waste management is in decentralization. Localize the system and you save a fortune. I’ll give you another example, this time from DC. Up until about 10 years ago, DC had a very good dual stream recycling system. The materials were collected by unionized crews, they would be delivered to a dual stream processing plant in the city, owned by a minority company with about 20-25 workers. Well, for reasons that have never been explained, the city switched to single-stream which meant that company went out of business.
And instead of sending materials to a facility in DC on North Capitol Street, DC is now sending its materials about 40 miles up the road … 35-40 miles up the road to Elkridge, Maryland where it is being processed. The transportation costs alone up probably about $500,000 a year that are totally unnecessary because you don’t need to ship 25,000, 30,000 tons of recyclables 40 miles when you could process them in town or across the border in Prince George’s County.
John Farrell:
I just wanted to follow up on that particular thing because one of the points that you made in your article Neil was that the things that Waste Management wants, you know their business is taking garbage and landfilling it or even burning it. I have done a lot of work on incineration, and I’m just curious, it seems like it would be more cost effective for cities to keep that stuff … to keep the waste stream local, to sort out locally but why does it end up costing more than from these … to give it to these big companies, why do cities end up paying more to do that? I mean you mentioned, for example it’s much more profitable, so is the fact that they are able to control the market pricing and charge more for it than a should be, or is it because of those transportation costs you mention? What makes landfilling and burning garbage expensive?
Neil Seldman:
Well, all of the above. The transportation costs are considerable. The profitability in large scale operations is that you get paid to collect the material, and you get paid to process it. In fact, DC is paying $117 a ton to process its recyclables after shipping it all the way up to 35 or 40 miles. So the profitability comes from the large waste companies being able to one, convince cities to drop dual stream and go to single-stream to use their larger facilities, and also because they get paid for collecting, they get paid for processing, so when it comes to getting revenue from the materials on the market they’re almost indifferent because they’re getting their money from their contracts and they need to keep recycling, because citizens require it, the law requires it. If they don’t recycle, they’ll lose their contracts. All of these factors piled together. Why DC and other cities moved to single-stream, I would say it’s because of lobbying, it’s because of political donations to city council people. It’s everything big corporations do to move cities and move public money into the private sector.
John Farrell:
And I think you said that as well in the piece, that it is more expensive when they lobby to control in a particular. I think you even had a number in there about when we have this concentration of waste haulers, a noncompetitive market for recycling, that there’s a fairly significant price premium that ultimately is passed on to consumers, it’s passed on to the people who are putting their recyclables out.
Neil Seldman:
Yeah, both cities as well as businesses. One small waste company estimates that the cost of solid waste management in the United States because of these large companies is 30% higher than it should be. And there are companies out there approving this. I don’t know the numbers, the profit ratios of these companies but I do know that very smart companies are taking away market share. One company that we’ve been looking at, a company called RoadRunner, is a relatively new company there mostly in the Mid-Atlantic area. And they do a tremendous job of working with commercial enterprises to do real source separation, keep the glass, paper and other things separate.
And they collect them separately and deliver them directly to end markets or efficient processing centers and they revenue-share with the companies, whereas if you have a large waste company taking your materials, even if you recycle a lot, your price for services from these companies is not going to go down. Whereas if you go to a company like Roadrunner and you’re recycling a lot and you’re getting revenue share, the amount of waste and money that you have to pay to a large hauler is greatly diminished. So the more source separation, the lower the cost and the better the bottom line of these companies.
John Farrell:
So it seems sort of unfortunate. I think about this, even in my own community in Minneapolis, Minnesota. You mention Eureka, they serve St. Paul which is our neighboring community.
Neil Seldman:
Yes.
John Farrell:
In Minneapolis Waste Management has the garbage and recycling contract for the city and as you know we did switch from separating our recyclables I’d say five years ago to a single-stream, where we’ve got one big bin that we’re filling up every week. And at first it seemed like, “Hey, this is such a great deal, like instead of having …” I mean previously we separated everything. I mean we had nine or ten different little bins or bags, and it was quite a lot of work to do that, although we got used to it. And now we just do this one huge bin, and I suspect that it’s probably not going to be a good deal for the city in the long run because as you say, there’s no advantage to recycling more at this point because the materials are not even going to be of high enough quality that they can be sold, especially now that China has stopped taking.
Neil Seldman:
The recyclables from Minnesota … Excuse me, Minneapolis, are processed by Eureka, and they’re doing a good job, it’s a relatively small scale operation, roughly 200 tons per day. And the reason that Eureka’s facility exists is because these folks were very smart, the Eureka people. They realized that recycling as an escape valve from landfills and incineration is under threat because Waste Management Inc was shooting for building their own processing center and capturing all the materials themselves. And in fact, that actually happened. Ramsey County MAF shut down and Waste Management Inc had one of their operations there. But what Eureka did, it went to its end markets, mostly the paper companies that were buying their paper, got capital from those to build their own MAF and are now paying off that capital as they operate. And because Eureka in St. Paul did this, they had the facility and they won the contract for processing in Minneapolis.
So what Eureka has done was to establish the escape valve for reasonable prices and good recycling. And one of the comments I’ll make John, you mentioned that separating into six or seven bags is a pain in the neck, if you will but very few communities ask citizens to do that. Most dual stream systems just ask you to keep two separations, paper and all the other mixed materials. And dual stream recycling which I just described takes about two minutes per person per week in a family to participate in, which is not a burden and in fact it’s an educational opportunity for children in the household.
John Farrell:
Well, I certainly know that my kids are pretty good at learning their bins. We also have Curbside Organics Collection here, and it’s actually pretty exciting for them because we know that the trash bin is for just about nothing, and they certainly don’t take as much out as a result of that. I wanted to pivot a little bit, there’s been a lot of negative coverage about China and we’ve talked about a lot of the challenges in terms of the control of the waste stream and then sort of calling the question that China has done here. I’m really curious, China has essentially said, “We’re going to slam the brakes on this centralized model of high volume, low quality recycling collection.” What’s the opportunity for cities? For example, what are some strategies cities can use to reduce or divert waste to avoid that more centralized system? And then what else can they do around recycling?
Neil Seldman:
The article you mentioned on single-stream has a list of eight or nine things that cities can do, but I would say the two most important things are three. One is to consider what’s called a pay as you throw system or unit pricing, just as a household buys electricity or natural gas depending … It pays for what it uses. Pay as you throw or unit pricing allows families to just pay for the amount of garbage that they put out, not recyclables or organics, if they compost in the backyard or as you just described, it’s Curbside pick up. So moving to unit pricing could within one year double your recycling rate, and it also increases your backyard composting rate or your participation in curbside compost because everything time you get rid of your materials through recycling or composting, it means you pay less.
One city, a city of about 75,000 people, Weston, Massachusetts. Since they went to unit pricing 20 years ago they’ve saved $10 million dollars from their budget because of avoided disposal fees at landfills and incineration. So pay as you throw or unit pricing is one thing that is an immediate help. Focusing on compost is another because composting if you do it yourself in your backyard you eliminate 15% of your household waste stream, it never enters the waste stream and of course composting curbside, you need more centralized facilities. We recommend about 200-300 tons per day as a maximum for composting separated organics. And the third thing that’s important is that there needs to be in town or in city processing. None of this shipping recyclables 35 or 40 miles away. There are a number of bad elements in that, I’ll get to that.
But the key is that whether it’s dual stream or single-stream, if it’s scaled properly, if the facility is owned by people who want to recycle, not just divert materials that’s critical, so scale and ownership are important. And then finally quality is important, single-stream materials can be recycled at the proper scale and if you don’t do it at the proper scale, you wind up in the situation that DC is in. Right now DC is sending glass along with other materials in single-stream format, glass is about 20% by weight of the recycled fraction of the city’s materials. So right now DC is sending 20% of its waste … Excuse me, of its recyclables 35 miles away and the system cannot recover glass in a format that can be used by industry. Glass is used by making bottles, sandblasting, cement manufacturing and construction clean fill.
It’s a very value material, it’s homegrown you could recycle it forever but right now DC’s glass for which they pay a lot of money to collect and ship up there cannot be recycled. It has to be used as landfill cover by Waste Management Inc. So the city is paying a lot of money to get the glass up there and get no benefit from glass recycling.
John Farrell:
So can you explain a little bit, like what is the problem? Is it the fact that it’s breaking when it’s shipping? Is it the way that it gets mixed in with other things? Why is the glass unable to be used by industry or in a high quality fashion once it’s done in this way?
Neil Seldman:
It’s both those reasons. Glass is a material that breaks so every time you move it around you risk breaking glass. It goes from your household bin, into your recycled cart, into a truck that uses hydraulics to squeeze the material, then it gets dumped on a cement floor and then it gets processed some more. So you’re breaking the glass as you collect it and transport it. And that glass contaminates a lot of the other material glass … Excuse me, paper and plastic. As I said before, the material can be recovered from single-stream if it’s done properly. But if you are focused on mass throughput, you just process everything, you get the glass. Waste Management has a free material for landfill cover, so there’s really no … And they don’t have to pay any rebate to the cities on glass recycling, if the glass is sold to industry. So you have a system that encourages the big waste to continue processing in this sloppy manner without transparency and without efficiency.
John Farrell:
Yeah, that makes a lot of sense. That’s really helpful in terms of understanding it.
Neil Seldman:
Recycling is very popular in the United States as you know, but it really is … it’s not given the respect it’s due, if you don’t me using that example. But if DC right now has a recycling rate of 20%, if that rate over the next few years goes to 60%, many cities are doing 60% through recycling and composting. The Green greenhouse gas emissions savings from increased recycling at the 60% level in the DC example, is the equivalent of all the pollution from automobiles and electricity generation that’s used in the city. So those was a tremendous benefits for climate control, keeping the heat of the earth down. And any city can use the tactics used by the Advanced cities to get to 60% recycling or more. It’s all state of the art, its all known. Right now the United States has a 34-35% recycling rate, if that rate is doubled, you can imagine the incredible greenhouse gas savings.
The other important part of recycling and composting for greenhouse gas emissions is the use of compost. There’s a wonderful group of people out in Marin County, I think it’s called the Marin County Compost Project in which they’ve shown that putting significant amounts of compost on arable lands actually reduces greenhouse gases. So these are very important reasons for the economy of cities, but also for cities to reduce their environmental impact on the earth.
John Farrell:
If you have a city that has single-stream right now and I think there’s obviously going to be differences, because as you pointed out for Minneapolis where we have a single bin for recyclables, we have local processing at a reasonable scale. But if you don’t have that, if you have single-stream and you’re shipping it a long distance, what’s the right first step? Do you try to switch to dual stream? I mean, do you really need to get that local infrastructure as well? What’s the first thing that you need to do?
Neil Seldman:
There are four or five cities in the United States in the past month that have decided to switch to dual stream. I mentioned some of them in the piece, we’ve been getting information on others. But let’s take DC as an example. It’s a city of 600,000 people, it’s obviously a large city. What’s happening in DC … It’s easier in my opinion for DC to contract with a sensibly scaled local single-stream processor then it is for the city to go back to dual stream. I’d like to see the city go back to dual stream, but what’s happening is that the cost of recycling in DC is so high that it has provided an opening for at least one company, which we were aware of that’s building a properly scaled single-stream processing center, literally on DC’s border in Prince George’s County. It’s like 100 yards from the DC border. And it’s obvious to me that DC planners should put out an RFP when the current contract with Waste Management Inc expires, and encourage these smaller MRFs to get the contract to process locally.
In addition to this one company that’s now locating here as I mentioned, there’s another company in Manassas, Virginia, which is about 20-25 five miles away. Obviously the closer the facility is to the city the less expensive it’s going to be. But DC is also setting up a curbside compost program. We have a very active backyard compost program, thanks to new legislation passed this year in 2018, which provides monetary incentives to households that do a compost in their backyards or side yards. And as I mentioned before, it’s very wise of the city to spend 50 bucks per household to get them to do backyard composting. The 50 bucks is for a professional recycling bin, which of course you don’t need, you can build your own. But as I said, for every household that composts in its backyard you have 15% less waste coming out of that household, so a $50 investment to eliminate 15% of the waste forever is quite a bargain.
I would say that the most important thing is in-town processing, create job, proper scale good quality materials. It could be single-stream, it could be dual stream, if the owner and the scale are proper. I must give a shout-out to two of our close allies, Susan Kinsella and [Rich Kirkman 00:32:15] who wrote a piece, which is footnoted in my article on the Guidelines For Sensible Single-stream recycling. It includes compaction ratios, it includes not using cement floors, using sort of astro turf floors, and it also recommends the configuration of equipment at which point in the processing you take out glass. Obviously it’s good to get the glass out as early as possible, as soon as the glass is out it’s not a threat to the other materials. And also glass is the threats of the machinery, glass shards get involved, they get stuck in the oil and gum up the works, if you don’t mind my informal language. It’s in town processing, it’s composting, and it’s unit pricing, I think can get any city to 50% recycling and even more.
John Farrell:
So you mentioned something I thought was really important to tease out a little bit more about these new processing facilities being built near Washington DC, and the opportunity for the city to do better with its single-stream program. I did want to note by the way, we’ll have a link to the article that you published Neil as well as this other piece you just mentioned on Guidelines for Single-stream Recycling on the show page, so that folks can find it. One thing I’m curious about because this also happens in the energy business as well is, the contracts can be for a long time and so I’m curious, how quickly can cities make changes to their waste hauling business or are there sometimes really long contracts where they’re stuck in a system that may not be to their benefit?
Neil Seldman:
That is a very important insight. We’re lucky in the sense that in DC, that the recycling contract is only one year. The original contract was three years and there were one year expansion possibilities. Well, right now 2019 is the last year of a contract for recycling with Waste Management Inc, and that means a year from now in September 19, the DC DPW, Department of Public Works has to issue an RFP for future processing. And we’re assuming that other companies will bid, we’ve talked to the company that’s building this new facility, they’re planning on bidding. So we’re lucky there.
The length of contract is very important, and you have to do a balancing. You don’t want to give the company too long on their contract, because you want competition to come in. On the other hand you want the company to have enough security in their contract to make a decent investment and make the system work. So three years seems to be a reasonable length of contract for these recycling and garbage services. And some cities would add a one year option either for the company or for the city to renew.
John Farrell:
Do you know other than DC, what is a common contract length for other cities? Like are other cities signing much longer contracts? Like five years or even 10 years or is what DC has done relatively common and that maybe I will be able to change things tomorrow if I got elected to city council or was elected mayor, but that within my term I would be able to make changes to improve recycling policy?
Neil Seldman:
I would say the three years with a one year option is typical. But as I just mentioned, contracts for different services have different lengths. The contractor for recycling is three years plus one and we are in that one year now, the contract for handling garbage out of city and city garbage, those contracts are longer. I don’t see any reason why they should be which is why I and DC Environmental Network and other environmental groups are urging the city council in the DPW not to sign a long contract and to put out the bid so that the price of $8 in change rises to maybe $35, $40 so the city is collecting market rate for using public services. There’s one unique city and that’s San Francisco, and this is a very interesting story. San Francisco is served in recycling and garbage by a company called Recology.
Well, Recology used to be Sunset Scavengers which was a cooperative of Italian immigrant businesses in the 1930s, it could have gone back to the 20s. And for reasons that have been researched but I’m not quite familiar with the history, in the 1930s, the city charter was rewritten so that Sunset Scavenges had the exclusive right forever to serve the city of San Francisco for garbage and then recycling services. So San Francisco is unique in that it has a forever contract with this one company. Sunset Scavenges eventually evolved into this new company called Recology.
John Farrell:
Interesting. So most folks will have some flexibility but your mileage may vary if you come from San Francisco.
Neil Seldman:
That is correct and it’s a very interesting situation. San Francisco’s recycling close to 80%, so is Berkeley, California across the bay. And both cities use completely different systems. San Francisco is a monopoly, but the monopoly is serving the city well. In Berkeley the recycling system is comprised of about six different entities, three nonprofits, two for profits and one city agency and it’s completely decentralized, the exact opposite of San Francisco. And yet both cities have very, very high recycling rates, which proves that each city is unique and that there are many ways to accomplish good recycling and composting.
John Farrell:
So Neil, I’d like to wrap up by just opening it to a hypothetical here. So about a third of Americans live in a city with a population of 100,000 or more. So let’s just say you’re in a community of a 200,000 people. Right now all of your waste is being landfilled, so you’re starting with a clean slate. What are the first three things that you do? And I think you’ve kind of already alluded to this, but what are the first three things you do, the first three policies that you would put into place to help the city save money and create jobs and shift away from landfilling to waste recovery?
Neil Seldman:
The way professional zero waste planners approach this is to look at that hypothetical city of a 100,000 using a landfill and they identify the voids, what’s missing from this picture that’s needed to get to high levels of recycling composting? And you identify them. Is it mandatory? Is it unit pricing? Et cetera, et cetera. And once you have that analysis then you start saying, “Okay, what do we need to solve this void? How can we fill this void?” And as you mentioned in my summary earlier, it’s unit pricing, composting and in-town recycling. There are a number of other things that these cities can do. One of the things we recommend the most is to build up and attract from the outside if necessary, companies that refurbish products. Not recycle them but refurbish appliances, mattresses, furniture, cars, electronics scrap, textiles, refurbishing textiles into new styles is a major trend in the fashion industry.
In fact, there was a major article on it couple weeks ago in the Sunday paper here in DC. There’re specialty companies, building deconstruction companies. There’s a wonderful group out in Lane County, Oregon, Eugene, St. Vincent de Paul that specializes in creating jobs for the hard to employ people and giving them the social services, the housing services, the training that are necessary for them to survive to do well in the economy and they’ve created 500, 600 jobs in their system. There’s another classic example in Baltimore, The Second Chance where the city and Second Chance, a nonprofit created some unique contracts giving … Any time a job is open at a Second Chances building materials company, it’s filled by someone on what’s called the Tanf roles, T.A.N.F. I forget what it stands for but it’s basically the welfare roles.
And if these people who are recruited through the system from the city complete a 10 week training program, they are guaranteed a full time job with health insurance and many other services. Well, when we started helping that company in 2003, they had six employees. Now they have 175 and all of those new employees have been recruited from the hard to employ. So as the people at second chance say, we’re not only saving materials and products, we’re saving people which is literally true. And these repair groups St. Vincent de Paul, Second Chance, the National Deconstruction, a nonprofit called the Reuse People they have branches is 16 different cities. These companies not only create good jobs and divert bulky materials from the landfill but they have incredible social impact, particularly E-scrap, electronic scrap reuse.
There’s one company called Recycle Force in Indianapolis, the national recidivism rate is about 75, 76%. In these reuse companies, speaking about Recycle Force, the recidivism rate of their workforce is 25, 26% and that dramatic reduction in people, young men and women going back to prison is an incredible savings in terms of expenses but also reduced crime, reduced hardship from criminal activity et cetera for both the victim and the perpetrator. So the social impact of reuse is dramatic and I always point out that in Eugene, Oregon the cost of living for low income people has gone down about 3% because through their 13 thrift stores, they sell all their refurbished materials, so not only are they creating good jobs for people but they’re providing people with furniture and appliances and clothing et cetera at a very reduced cost.
In fact their policy is, if you can afford it just take it. So these companies have … Reuse companies have a tremendous social as well as economic impact and we recommend that when cities have warehouses, own or control warehouses, that they turn these over to these reuse companies. And this is exactly what happened with the Second Chance, not only does Second Chance have the contract to train workers, it has a contract with the city to go into any school building or public building that’s scheduled to take down and the workers can what’s called cherry picking, pick out the very valuable materials before demolition. The other aspect of their contract is, Second Chance now owns 300,000 square feet of show space and storage space in downtown Baltimore, formerly owned by the city now transferred to Second Chance.
So these folks have worked with the city, the benefits to the city are dramatic and the benefits to the workers and patrons of the company are also dramatic. So I would say setting up a reuse center, a warehouse if available, each reuse business needs 20,000 square feet and will employ about 15 to 20 workers, so one warehouse can become a major reuse center for a city or even a region.
John Farrell:
Neal I really appreciate you taking the time to talk with me to paint a picture of what cities can do differently. And I would be remiss if I didn’t at the end of our interview ask us if you have any reading recommendations, something you’ve been reading recently that you would recommend to our listeners.
Neil Seldman:
I would recommend three books, all written by friends of the Institute by the way. One is Plastic Ocean by Charles Moore, Captain Charles Moore. There’s a revised issue coming up, the book is about four years old. It describes what’s going on in the ocean. The other book is Zero Waste, Saving the Planet One Community at a Time by our other good friend Paul Connett. Dr. Paul Connett, retired professor of chemistry was an indefatigable, anti-incineration, pro-recycling campaigner throughout the world. And the third book I would recommend, particularly for families that have young kids would be Worms Eat My Garbage by Mary Appelhof plus her sequel Worms Eat more of My Garbage which explains how every family can be composting their food waste, either in the basement or the backyard and how to teach how it impacts kids growing up in that household. My kids who are now 35 and 40 still compost and John I bet your kids will be composting when they grow up and have their own household.
John Farrell:
I would like to think so Neil, as long as they also have solar on the roof, that’s …
Neil Seldman:
Of course. Composting and solar go together.
John Farrell:
Well Neil thanks so much for taking the time, it’s great talking to you and great to hear from you
Neil Seldman:
Okay, thanks again.
Lisa Gonzalez:
Thank you for tuning into this episode of Building Local Power. You can find links to what we discussed today by going to our website, islr.org and clicking on the show page for this episode. That’s islr.org. While you’re there you can sign up for one of our newsletters and connect with us Facebook and Twitter. And once again, please help us out by writing this podcast and sharing it with your friends. This show is produced by Hibba Meraay, our theme music is Funk Interlude by Dysfunction AL. For the Institute for Local Self-Alliance, I’m Lisa Gonzalez. I hope you’ll join us again in two weeks for the next episode of Building Local Power.
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In this episode, host John Farrell, ILSR’s Energy Democracy Initiative Director is joined by Neil Seldman, ILSR’s co-founder and director of the Waste to Wealth program, to discuss how convenient single-bin recycling may have made things easy for the consumer, but harder for cities to capture the economic benefits of recycling.
Recently, China made good on a promise to stop accepting U.S. recycling due to the low quality of materials. The problem has been exacerbated by consolidation. Four giant waste companies, profiting more from disposal than recycling, control half the market. The combination of contamination in the bin and poor processing practices by industry giants means missed opportunities to grow local economies.
Although the Chinese embargo shocked the industry, Neil explains how this turn of events is an opportunity. Cities can redesign waste handling systems to recover cleaner glass and plastic, support local jobs, and provide raw material for local industry. How can communities move towards a decentralized recycling system and capture more value from their waste stream? Tune in to find out!
The cost of solid waste management, in the United States, because of these large companies is 30% higher than it should be.
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Transcript
John Farrell:
We’re talking this week with Neil Seldman. He’s co-founder of the Institute for Local Self-Reliance, the director of The Waste to Wealth Program, which has for decades now been helping communities capture more of the value on their waste stream. Neil, I’m just so glad to be able to talk to about this because obviously I already took up half of a staff meeting trying to ask you questions about it, so thanks for taking the time to share with the rest of the world what’s going on in the recycling business.
Neil Seldman:
Sure, my pleasure.
John Farrell:
I just had to say, what got me so excited about talking to you about this was, as you have said, as so many of us talk about and the issues we work on, these are often inherently local issues but waste disposal is more inherently local than just about anything. But it’s actually something that China changed recently, way on the other side of the world that has put recycling in the news. And so I was hoping you could start by just explaining what did China change about its recycling policies that is impacting recycling at the local level across the United States?
Neil Seldman:
Okay, for the last let’s say 20 years, China has been purchasing recyclable material from the United States and using it in its industries. The markets in China were extremely tolerant, meaning that US cities and waste companies could ship recyclables that were contaminated, sometimes up to 40% with either things that aren’t recyclable or the process of single-stream recycling, wherein all recyclables are mixed in the same bin, they get transferred in the same truck and then transferred once again to larger trucks and overseas shipping, the glass breaks, the glass contaminates, glass shards contaminate plastic and glass. Around 2013, China announced that they were going to start cleaning up their industry and they did not want to receive contaminated recyclables from the United States.
One of the reasons is environmental but the other is economic. Labor in China has been increasing in cost and the Chinese figured, why should they pay to clean up US recyclables? So over the next few years, they kept on restricting more and more imports from the United States of single-stream material, and in 2007 they announced a very strict policy in which they literally stopped taking US imports through a variety of means. They stopped issuing permits, they started requiring inspections in the United States then doubling inspections back in China, they limited the number of ports that the materials can come in. And the bottom line is that they in effect cut off purchasing sloppy recycling or single-stream recycling. And as a result of that, it really threw US cities for a loop because all of a sudden the market for contaminated recyclables disappeared.
Cities that use single-streams … Excuse me, double stream systems, dual stream systems in which the paper is kept separate from the other recyclables, those materials are cleaner and moving to markets. In fact, the Chinese have not banned US recyclables from the United States, they just banned US recyclables that are contaminated. And what’s happening now is that US firms, Chinese firms mostly and other foreign companies are purchasing facilities in the United States. Some companies, Chinese companies are building their own facilities to process the plastic in the United States into pellets, very clean materials that are what we call furnace ready, meaning the manufacturing company that imports this has the material when it’s ready to go into their manufacturing process.
Orders for plastic pellets from China are soaring and the same thing is happening in paper. Chinese and other foreign investors are building and purchasing US paper mills so that they can collect paper in the United States, the US recycling stream is very, very rich in good materials, and sending over either fiber or finished paper back to China for internal use. At the same time, the Chinese are starting, just starting to recycle from inside their own industry and economy and that is a very slow process. We’ve been following what’s going on in Chinese cities and the recycling programs and composting programs are in their nascent stages.
John Farrell:
Sure. I want to take a step back here because when you talked about single-stream, I think this is something you just published a piece about, sort of Untangling the Waste Knot and you were talking about some of these contributing factors to why China in 2017, last year really clamped down on the US sending sort of dirty recycling materials. Single-stream recycling just for folks that aren’t familiar, that’s the idea that I have one big bin that I can put all my recyclables in. And the theory behind it was, this makes it easier for customers to recycle so they’ll recycle more, but can you explain a little bit about why single-stream has first of all been a problem in terms of the materials we get. In fact, you actually wrote in that piece, “Single-stream recycling has given households another garbage can.” So I think pretty clearly a problem. But then also explain, you talk a little bit more in the piece as well about how this contributes to consolidation of the different market players in the waste industry which is something I think many people won’t understand.
Neil Seldman:
Let me start by recalling how you started this interview by pointing out that garbage collection and recycling is inherently local. It is inherently local, and up through the 1950s, garbage which is a local responsibility for either the city or the county was small mom-and-pops, collecting garbage, bringing it to landfill or transfer facilities. The economy of scale of a successful company was maybe five to 10 trucks with drivers, crews of course, office people and it was very profitable. And as people who know US history, many immigrant waves went into this business, garbage collection and as a result of American capitalists just not thinking it very important. Well, it turns out it’s quite important. And starting in the late 50s, early 60s, there were three waves of consolidation.
And what consolidation meant was not increasing the economy of scale of operations but centralizing ownership, and this happened through massive influx of capital to a couple of companies that then started buying successful smaller companies, so that now we have the four companies that dominate the national scene. Probably 50 or 60% of the market for hauling in landfill belongs to four companies. The two biggest ones are Waste Management Inc and Allied. What these companies have done is to convince cities through bargaining, lobbying, all kinds of cajoling to switch from dual stream to single-stream to make it easier for them to collect the materials. And they went this way because US citizens changed the rules for recycling.
Citizens passed laws making recycling mandatory, requiring all kinds of new regulations to support and nurture recycling. And the waste companies immediately had to switch to recycling in order to keep their contracts, and the contracts were important because market share is critical for increasing your profits not necessarily efficiency but increasing profits. And as a result, the concentration of capital allowed the large companies to buy up smaller companies, convince cities to go to single-stream which means a big investment in capital, and then ship the recyclable materials to centralized processing centers called MRFs, material recovery facilities that are far out of town. So the centralization of collection and then large processing plants allowed the industry to dominate recycling. And prior to that point, recycling was seen as an escape valve from the control that these companies had over garbage.
And as a result of that, we have companies in charge of recycling that really don’t like to recycle because they make so little profit. Last few years they’ve actually been losing a little money, whereas on the landfill side, some advisors we talk to, point out that profits at landfill are in the 60-70% range and profits in the recycling area are marginal. And in fact, recycling is a marginal part of these companies businesses, and their interest in recycling is mass throughput not quality, and that’s why we had … the result is single-stream collection, sending materials to concentrated large scale processing plants whose purpose is mass throughput not quality recycling. In that piece I point out that single-stream recycling can be very, very effective and I use to examples one in Boulder, Colorado run by Eco-Cycle, a grassroots company. And the other in Twin Cities, Eureka, another grassroots enterprise.
Those companies operate mass material recovery facilities that maybe … Range of 200-300 tons per day, whereas the large centralized facilities that are located out of town are processing 900-1,000 tons per day. And there was a wonderful example of this a few years ago in Wilmington, Pennsylvania where a private entrepreneur built a composting plant scale to 300 tons per day of separated organics. They were operating well, the owner made the mistake in my opinion of accepting an investment from Waste Management Inc and he proceeded to lose control over the company. As soon as Waste Management Inc got control of the company they scaled up the plant to 600 tons per day to get more materials through to collect more tipping fees. The result was that the system broke down, composting did not work under those conditions, the place started stinking and within six months the place was closed down by the Delaware Department of Natural Resources. And there was no effort to fix the plant, Waste Management Inc just abandoned it.
And it led to a lot of speculation that the investment by Waste Management Inc was done on purpose to shut it down, because Waste Management Inc, when stuff is composted, it’s not landfilled and they lose profits. That is an allegation. That’s logical given what we’ve seen what big waste has done, pushing incineration, pushing single-stream recycling, pushing mega-mass and mega landfills. So the efficiency in recycling and waste management is in decentralization. Localize the system and you save a fortune. I’ll give you another example, this time from DC. Up until about 10 years ago, DC had a very good dual stream recycling system. The materials were collected by unionized crews, they would be delivered to a dual stream processing plant in the city, owned by a minority company with about 20-25 workers. Well, for reasons that have never been explained, the city switched to single-stream which meant that company went out of business.
And instead of sending materials to a facility in DC on North Capitol Street, DC is now sending its materials about 40 miles up the road … 35-40 miles up the road to Elkridge, Maryland where it is being processed. The transportation costs alone up probably about $500,000 a year that are totally unnecessary because you don’t need to ship 25,000, 30,000 tons of recyclables 40 miles when you could process them in town or across the border in Prince George’s County.
John Farrell:
I just wanted to follow up on that particular thing because one of the points that you made in your article Neil was that the things that Waste Management wants, you know their business is taking garbage and landfilling it or even burning it. I have done a lot of work on incineration, and I’m just curious, it seems like it would be more cost effective for cities to keep that stuff … to keep the waste stream local, to sort out locally but why does it end up costing more than from these … to give it to these big companies, why do cities end up paying more to do that? I mean you mentioned, for example it’s much more profitable, so is the fact that they are able to control the market pricing and charge more for it than a should be, or is it because of those transportation costs you mention? What makes landfilling and burning garbage expensive?
Neil Seldman:
Well, all of the above. The transportation costs are considerable. The profitability in large scale operations is that you get paid to collect the material, and you get paid to process it. In fact, DC is paying $117 a ton to process its recyclables after shipping it all the way up to 35 or 40 miles. So the profitability comes from the large waste companies being able to one, convince cities to drop dual stream and go to single-stream to use their larger facilities, and also because they get paid for collecting, they get paid for processing, so when it comes to getting revenue from the materials on the market they’re almost indifferent because they’re getting their money from their contracts and they need to keep recycling, because citizens require it, the law requires it. If they don’t recycle, they’ll lose their contracts. All of these factors piled together. Why DC and other cities moved to single-stream, I would say it’s because of lobbying, it’s because of political donations to city council people. It’s everything big corporations do to move cities and move public money into the private sector.
John Farrell:
And I think you said that as well in the piece, that it is more expensive when they lobby to control in a particular. I think you even had a number in there about when we have this concentration of waste haulers, a noncompetitive market for recycling, that there’s a fairly significant price premium that ultimately is passed on to consumers, it’s passed on to the people who are putting their recyclables out.
Neil Seldman:
Yeah, both cities as well as businesses. One small waste company estimates that the cost of solid waste management in the United States because of these large companies is 30% higher than it should be. And there are companies out there approving this. I don’t know the numbers, the profit ratios of these companies but I do know that very smart companies are taking away market share. One company that we’ve been looking at, a company called RoadRunner, is a relatively new company there mostly in the Mid-Atlantic area. And they do a tremendous job of working with commercial enterprises to do real source separation, keep the glass, paper and other things separate.
And they collect them separately and deliver them directly to end markets or efficient processing centers and they revenue-share with the companies, whereas if you have a large waste company taking your materials, even if you recycle a lot, your price for services from these companies is not going to go down. Whereas if you go to a company like Roadrunner and you’re recycling a lot and you’re getting revenue share, the amount of waste and money that you have to pay to a large hauler is greatly diminished. So the more source separation, the lower the cost and the better the bottom line of these companies.
John Farrell:
So it seems sort of unfortunate. I think about this, even in my own community in Minneapolis, Minnesota. You mention Eureka, they serve St. Paul which is our neighboring community.
Neil Seldman:
Yes.
John Farrell:
In Minneapolis Waste Management has the garbage and recycling contract for the city and as you know we did switch from separating our recyclables I’d say five years ago to a single-stream, where we’ve got one big bin that we’re filling up every week. And at first it seemed like, “Hey, this is such a great deal, like instead of having …” I mean previously we separated everything. I mean we had nine or ten different little bins or bags, and it was quite a lot of work to do that, although we got used to it. And now we just do this one huge bin, and I suspect that it’s probably not going to be a good deal for the city in the long run because as you say, there’s no advantage to recycling more at this point because the materials are not even going to be of high enough quality that they can be sold, especially now that China has stopped taking.
Neil Seldman:
The recyclables from Minnesota … Excuse me, Minneapolis, are processed by Eureka, and they’re doing a good job, it’s a relatively small scale operation, roughly 200 tons per day. And the reason that Eureka’s facility exists is because these folks were very smart, the Eureka people. They realized that recycling as an escape valve from landfills and incineration is under threat because Waste Management Inc was shooting for building their own processing center and capturing all the materials themselves. And in fact, that actually happened. Ramsey County MAF shut down and Waste Management Inc had one of their operations there. But what Eureka did, it went to its end markets, mostly the paper companies that were buying their paper, got capital from those to build their own MAF and are now paying off that capital as they operate. And because Eureka in St. Paul did this, they had the facility and they won the contract for processing in Minneapolis.
So what Eureka has done was to establish the escape valve for reasonable prices and good recycling. And one of the comments I’ll make John, you mentioned that separating into six or seven bags is a pain in the neck, if you will but very few communities ask citizens to do that. Most dual stream systems just ask you to keep two separations, paper and all the other mixed materials. And dual stream recycling which I just described takes about two minutes per person per week in a family to participate in, which is not a burden and in fact it’s an educational opportunity for children in the household.
John Farrell:
Well, I certainly know that my kids are pretty good at learning their bins. We also have Curbside Organics Collection here, and it’s actually pretty exciting for them because we know that the trash bin is for just about nothing, and they certainly don’t take as much out as a result of that. I wanted to pivot a little bit, there’s been a lot of negative coverage about China and we’ve talked about a lot of the challenges in terms of the control of the waste stream and then sort of calling the question that China has done here. I’m really curious, China has essentially said, “We’re going to slam the brakes on this centralized model of high volume, low quality recycling collection.” What’s the opportunity for cities? For example, what are some strategies cities can use to reduce or divert waste to avoid that more centralized system? And then what else can they do around recycling?
Neil Seldman:
The article you mentioned on single-stream has a list of eight or nine things that cities can do, but I would say the two most important things are three. One is to consider what’s called a pay as you throw system or unit pricing, just as a household buys electricity or natural gas depending … It pays for what it uses. Pay as you throw or unit pricing allows families to just pay for the amount of garbage that they put out, not recyclables or organics, if they compost in the backyard or as you just described, it’s Curbside pick up. So moving to unit pricing could within one year double your recycling rate, and it also increases your backyard composting rate or your participation in curbside compost because everything time you get rid of your materials through recycling or composting, it means you pay less.
One city, a city of about 75,000 people, Weston, Massachusetts. Since they went to unit pricing 20 years ago they’ve saved $10 million dollars from their budget because of avoided disposal fees at landfills and incineration. So pay as you throw or unit pricing is one thing that is an immediate help. Focusing on compost is another because composting if you do it yourself in your backyard you eliminate 15% of your household waste stream, it never enters the waste stream and of course composting curbside, you need more centralized facilities. We recommend about 200-300 tons per day as a maximum for composting separated organics. And the third thing that’s important is that there needs to be in town or in city processing. None of this shipping recyclables 35 or 40 miles away. There are a number of bad elements in that, I’ll get to that.
But the key is that whether it’s dual stream or single-stream, if it’s scaled properly, if the facility is owned by people who want to recycle, not just divert materials that’s critical, so scale and ownership are important. And then finally quality is important, single-stream materials can be recycled at the proper scale and if you don’t do it at the proper scale, you wind up in the situation that DC is in. Right now DC is sending glass along with other materials in single-stream format, glass is about 20% by weight of the recycled fraction of the city’s materials. So right now DC is sending 20% of its waste … Excuse me, of its recyclables 35 miles away and the system cannot recover glass in a format that can be used by industry. Glass is used by making bottles, sandblasting, cement manufacturing and construction clean fill.
It’s a very value material, it’s homegrown you could recycle it forever but right now DC’s glass for which they pay a lot of money to collect and ship up there cannot be recycled. It has to be used as landfill cover by Waste Management Inc. So the city is paying a lot of money to get the glass up there and get no benefit from glass recycling.
John Farrell:
So can you explain a little bit, like what is the problem? Is it the fact that it’s breaking when it’s shipping? Is it the way that it gets mixed in with other things? Why is the glass unable to be used by industry or in a high quality fashion once it’s done in this way?
Neil Seldman:
It’s both those reasons. Glass is a material that breaks so every time you move it around you risk breaking glass. It goes from your household bin, into your recycled cart, into a truck that uses hydraulics to squeeze the material, then it gets dumped on a cement floor and then it gets processed some more. So you’re breaking the glass as you collect it and transport it. And that glass contaminates a lot of the other material glass … Excuse me, paper and plastic. As I said before, the material can be recovered from single-stream if it’s done properly. But if you are focused on mass throughput, you just process everything, you get the glass. Waste Management has a free material for landfill cover, so there’s really no … And they don’t have to pay any rebate to the cities on glass recycling, if the glass is sold to industry. So you have a system that encourages the big waste to continue processing in this sloppy manner without transparency and without efficiency.
John Farrell:
Yeah, that makes a lot of sense. That’s really helpful in terms of understanding it.
Neil Seldman:
Recycling is very popular in the United States as you know, but it really is … it’s not given the respect it’s due, if you don’t me using that example. But if DC right now has a recycling rate of 20%, if that rate over the next few years goes to 60%, many cities are doing 60% through recycling and composting. The Green greenhouse gas emissions savings from increased recycling at the 60% level in the DC example, is the equivalent of all the pollution from automobiles and electricity generation that’s used in the city. So those was a tremendous benefits for climate control, keeping the heat of the earth down. And any city can use the tactics used by the Advanced cities to get to 60% recycling or more. It’s all state of the art, its all known. Right now the United States has a 34-35% recycling rate, if that rate is doubled, you can imagine the incredible greenhouse gas savings.
The other important part of recycling and composting for greenhouse gas emissions is the use of compost. There’s a wonderful group of people out in Marin County, I think it’s called the Marin County Compost Project in which they’ve shown that putting significant amounts of compost on arable lands actually reduces greenhouse gases. So these are very important reasons for the economy of cities, but also for cities to reduce their environmental impact on the earth.
John Farrell:
If you have a city that has single-stream right now and I think there’s obviously going to be differences, because as you pointed out for Minneapolis where we have a single bin for recyclables, we have local processing at a reasonable scale. But if you don’t have that, if you have single-stream and you’re shipping it a long distance, what’s the right first step? Do you try to switch to dual stream? I mean, do you really need to get that local infrastructure as well? What’s the first thing that you need to do?
Neil Seldman:
There are four or five cities in the United States in the past month that have decided to switch to dual stream. I mentioned some of them in the piece, we’ve been getting information on others. But let’s take DC as an example. It’s a city of 600,000 people, it’s obviously a large city. What’s happening in DC … It’s easier in my opinion for DC to contract with a sensibly scaled local single-stream processor then it is for the city to go back to dual stream. I’d like to see the city go back to dual stream, but what’s happening is that the cost of recycling in DC is so high that it has provided an opening for at least one company, which we were aware of that’s building a properly scaled single-stream processing center, literally on DC’s border in Prince George’s County. It’s like 100 yards from the DC border. And it’s obvious to me that DC planners should put out an RFP when the current contract with Waste Management Inc expires, and encourage these smaller MRFs to get the contract to process locally.
In addition to this one company that’s now locating here as I mentioned, there’s another company in Manassas, Virginia, which is about 20-25 five miles away. Obviously the closer the facility is to the city the less expensive it’s going to be. But DC is also setting up a curbside compost program. We have a very active backyard compost program, thanks to new legislation passed this year in 2018, which provides monetary incentives to households that do a compost in their backyards or side yards. And as I mentioned before, it’s very wise of the city to spend 50 bucks per household to get them to do backyard composting. The 50 bucks is for a professional recycling bin, which of course you don’t need, you can build your own. But as I said, for every household that composts in its backyard you have 15% less waste coming out of that household, so a $50 investment to eliminate 15% of the waste forever is quite a bargain.
I would say that the most important thing is in-town processing, create job, proper scale good quality materials. It could be single-stream, it could be dual stream, if the owner and the scale are proper. I must give a shout-out to two of our close allies, Susan Kinsella and [Rich Kirkman 00:32:15] who wrote a piece, which is footnoted in my article on the Guidelines For Sensible Single-stream recycling. It includes compaction ratios, it includes not using cement floors, using sort of astro turf floors, and it also recommends the configuration of equipment at which point in the processing you take out glass. Obviously it’s good to get the glass out as early as possible, as soon as the glass is out it’s not a threat to the other materials. And also glass is the threats of the machinery, glass shards get involved, they get stuck in the oil and gum up the works, if you don’t mind my informal language. It’s in town processing, it’s composting, and it’s unit pricing, I think can get any city to 50% recycling and even more.
John Farrell:
So you mentioned something I thought was really important to tease out a little bit more about these new processing facilities being built near Washington DC, and the opportunity for the city to do better with its single-stream program. I did want to note by the way, we’ll have a link to the article that you published Neil as well as this other piece you just mentioned on Guidelines for Single-stream Recycling on the show page, so that folks can find it. One thing I’m curious about because this also happens in the energy business as well is, the contracts can be for a long time and so I’m curious, how quickly can cities make changes to their waste hauling business or are there sometimes really long contracts where they’re stuck in a system that may not be to their benefit?
Neil Seldman:
That is a very important insight. We’re lucky in the sense that in DC, that the recycling contract is only one year. The original contract was three years and there were one year expansion possibilities. Well, right now 2019 is the last year of a contract for recycling with Waste Management Inc, and that means a year from now in September 19, the DC DPW, Department of Public Works has to issue an RFP for future processing. And we’re assuming that other companies will bid, we’ve talked to the company that’s building this new facility, they’re planning on bidding. So we’re lucky there.
The length of contract is very important, and you have to do a balancing. You don’t want to give the company too long on their contract, because you want competition to come in. On the other hand you want the company to have enough security in their contract to make a decent investment and make the system work. So three years seems to be a reasonable length of contract for these recycling and garbage services. And some cities would add a one year option either for the company or for the city to renew.
John Farrell:
Do you know other than DC, what is a common contract length for other cities? Like are other cities signing much longer contracts? Like five years or even 10 years or is what DC has done relatively common and that maybe I will be able to change things tomorrow if I got elected to city council or was elected mayor, but that within my term I would be able to make changes to improve recycling policy?
Neil Seldman:
I would say the three years with a one year option is typical. But as I just mentioned, contracts for different services have different lengths. The contractor for recycling is three years plus one and we are in that one year now, the contract for handling garbage out of city and city garbage, those contracts are longer. I don’t see any reason why they should be which is why I and DC Environmental Network and other environmental groups are urging the city council in the DPW not to sign a long contract and to put out the bid so that the price of $8 in change rises to maybe $35, $40 so the city is collecting market rate for using public services. There’s one unique city and that’s San Francisco, and this is a very interesting story. San Francisco is served in recycling and garbage by a company called Recology.
Well, Recology used to be Sunset Scavengers which was a cooperative of Italian immigrant businesses in the 1930s, it could have gone back to the 20s. And for reasons that have been researched but I’m not quite familiar with the history, in the 1930s, the city charter was rewritten so that Sunset Scavenges had the exclusive right forever to serve the city of San Francisco for garbage and then recycling services. So San Francisco is unique in that it has a forever contract with this one company. Sunset Scavenges eventually evolved into this new company called Recology.
John Farrell:
Interesting. So most folks will have some flexibility but your mileage may vary if you come from San Francisco.
Neil Seldman:
That is correct and it’s a very interesting situation. San Francisco’s recycling close to 80%, so is Berkeley, California across the bay. And both cities use completely different systems. San Francisco is a monopoly, but the monopoly is serving the city well. In Berkeley the recycling system is comprised of about six different entities, three nonprofits, two for profits and one city agency and it’s completely decentralized, the exact opposite of San Francisco. And yet both cities have very, very high recycling rates, which proves that each city is unique and that there are many ways to accomplish good recycling and composting.
John Farrell:
So Neil, I’d like to wrap up by just opening it to a hypothetical here. So about a third of Americans live in a city with a population of 100,000 or more. So let’s just say you’re in a community of a 200,000 people. Right now all of your waste is being landfilled, so you’re starting with a clean slate. What are the first three things that you do? And I think you’ve kind of already alluded to this, but what are the first three things you do, the first three policies that you would put into place to help the city save money and create jobs and shift away from landfilling to waste recovery?
Neil Seldman:
The way professional zero waste planners approach this is to look at that hypothetical city of a 100,000 using a landfill and they identify the voids, what’s missing from this picture that’s needed to get to high levels of recycling composting? And you identify them. Is it mandatory? Is it unit pricing? Et cetera, et cetera. And once you have that analysis then you start saying, “Okay, what do we need to solve this void? How can we fill this void?” And as you mentioned in my summary earlier, it’s unit pricing, composting and in-town recycling. There are a number of other things that these cities can do. One of the things we recommend the most is to build up and attract from the outside if necessary, companies that refurbish products. Not recycle them but refurbish appliances, mattresses, furniture, cars, electronics scrap, textiles, refurbishing textiles into new styles is a major trend in the fashion industry.
In fact, there was a major article on it couple weeks ago in the Sunday paper here in DC. There’re specialty companies, building deconstruction companies. There’s a wonderful group out in Lane County, Oregon, Eugene, St. Vincent de Paul that specializes in creating jobs for the hard to employ people and giving them the social services, the housing services, the training that are necessary for them to survive to do well in the economy and they’ve created 500, 600 jobs in their system. There’s another classic example in Baltimore, The Second Chance where the city and Second Chance, a nonprofit created some unique contracts giving … Any time a job is open at a Second Chances building materials company, it’s filled by someone on what’s called the Tanf roles, T.A.N.F. I forget what it stands for but it’s basically the welfare roles.
And if these people who are recruited through the system from the city complete a 10 week training program, they are guaranteed a full time job with health insurance and many other services. Well, when we started helping that company in 2003, they had six employees. Now they have 175 and all of those new employees have been recruited from the hard to employ. So as the people at second chance say, we’re not only saving materials and products, we’re saving people which is literally true. And these repair groups St. Vincent de Paul, Second Chance, the National Deconstruction, a nonprofit called the Reuse People they have branches is 16 different cities. These companies not only create good jobs and divert bulky materials from the landfill but they have incredible social impact, particularly E-scrap, electronic scrap reuse.
There’s one company called Recycle Force in Indianapolis, the national recidivism rate is about 75, 76%. In these reuse companies, speaking about Recycle Force, the recidivism rate of their workforce is 25, 26% and that dramatic reduction in people, young men and women going back to prison is an incredible savings in terms of expenses but also reduced crime, reduced hardship from criminal activity et cetera for both the victim and the perpetrator. So the social impact of reuse is dramatic and I always point out that in Eugene, Oregon the cost of living for low income people has gone down about 3% because through their 13 thrift stores, they sell all their refurbished materials, so not only are they creating good jobs for people but they’re providing people with furniture and appliances and clothing et cetera at a very reduced cost.
In fact their policy is, if you can afford it just take it. So these companies have … Reuse companies have a tremendous social as well as economic impact and we recommend that when cities have warehouses, own or control warehouses, that they turn these over to these reuse companies. And this is exactly what happened with the Second Chance, not only does Second Chance have the contract to train workers, it has a contract with the city to go into any school building or public building that’s scheduled to take down and the workers can what’s called cherry picking, pick out the very valuable materials before demolition. The other aspect of their contract is, Second Chance now owns 300,000 square feet of show space and storage space in downtown Baltimore, formerly owned by the city now transferred to Second Chance.
So these folks have worked with the city, the benefits to the city are dramatic and the benefits to the workers and patrons of the company are also dramatic. So I would say setting up a reuse center, a warehouse if available, each reuse business needs 20,000 square feet and will employ about 15 to 20 workers, so one warehouse can become a major reuse center for a city or even a region.
John Farrell:
Neal I really appreciate you taking the time to talk with me to paint a picture of what cities can do differently. And I would be remiss if I didn’t at the end of our interview ask us if you have any reading recommendations, something you’ve been reading recently that you would recommend to our listeners.
Neil Seldman:
I would recommend three books, all written by friends of the Institute by the way. One is Plastic Ocean by Charles Moore, Captain Charles Moore. There’s a revised issue coming up, the book is about four years old. It describes what’s going on in the ocean. The other book is Zero Waste, Saving the Planet One Community at a Time by our other good friend Paul Connett. Dr. Paul Connett, retired professor of chemistry was an indefatigable, anti-incineration, pro-recycling campaigner throughout the world. And the third book I would recommend, particularly for families that have young kids would be Worms Eat My Garbage by Mary Appelhof plus her sequel Worms Eat more of My Garbage which explains how every family can be composting their food waste, either in the basement or the backyard and how to teach how it impacts kids growing up in that household. My kids who are now 35 and 40 still compost and John I bet your kids will be composting when they grow up and have their own household.
John Farrell:
I would like to think so Neil, as long as they also have solar on the roof, that’s …
Neil Seldman:
Of course. Composting and solar go together.
John Farrell:
Well Neil thanks so much for taking the time, it’s great talking to you and great to hear from you
Neil Seldman:
Okay, thanks again.
Lisa Gonzalez:
Thank you for tuning into this episode of Building Local Power. You can find links to what we discussed today by going to our website, islr.org and clicking on the show page for this episode. That’s islr.org. While you’re there you can sign up for one of our newsletters and connect with us Facebook and Twitter. And once again, please help us out by writing this podcast and sharing it with your friends. This show is produced by Hibba Meraay, our theme music is Funk Interlude by Dysfunction AL. For the Institute for Local Self-Alliance, I’m Lisa Gonzalez. I hope you’ll join us again in two weeks for the next episode of Building Local Power.
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