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July 3, 2007 > Transfer station fees hike garbage collection costs for Newark

Transfer station fees hike garbage collection costs for Newark

Last Thursday night (June 28), Newark's City Council was asked to authorize an interim waste disposal agreement with BLT Enterprises of Fremont, Inc. (BLT). Questions from councilmembers revealed significant changes in future waste disposal rates and processing due to decisions by City of Fremont staff and city council. TCV spoke with Newark Assistant City Manager Dennis Jones about the impact of these changes.

TCV: Is the Durham Road Landfill - at the end of Auto Mall Parkway - operated by Waste Management filled to capacity at this time?

Jones: No, it is anticipated that it will be able to receive materials through 2008. However, the City of Newark [and the public] will not be able to use it directly.

TCV: Why?

Jones: The City of Fremont has decided to close the road leading to the landfill for direct hauling effective July 1, 2007. So, even though the landfill can continue to receive material, it must be processed at a BLT "transfer station" on Boyce Road.

TCV: Are fees for this transfer similar to those currently charged at the landfill?

Jones: That's getting into the semantics. Trash taken directly to the landfill incurs disposal as the only cost. When you include a Transfer Station, the collection truck offloads and trash is then loaded on another truck for disposal at the landfill. This adds an additional cost of processing through the transfer facility operated by BLT.

TCV: Something called a "host fee" was discussed. What is that?

Jones: The City of Fremont is charging Newark and Union City an initial cost of $6.87 per ton to use the BLT facility. This is not part of the BLT rates.

Fremont has stated that this funding is to recover their investment cost. In all fairness, there were costs to develop the transfer facility. As I mentioned at the last council meeting, it is difficult to determine exactly when the current landfill will close and when the transfer station is necessary. You would not want the landfill to close before the transfer station is ready.

The transfer station has, in fact, been operational for six to eight months and there is a cost associated with that. BLT has spent a lot of money building this facility and they recover that cost by processing garbage. Up to now, there has been no garbage to process, so in agreements between BLT and Fremont, Fremont has supported BLT by writing rather large checks to offset operating and general costs.
Fremont has now decided to force other cities to use the transfer station, eliminating the supplemental payments to BLT who will make its profit by processing and transporting waste.

TCV: Will this "host fee" continue as a fixed cost?

Jones: The host fee will continue is for the entire 30 years of our agreement and is linked to the Consumer Price Index (CPI). Fremont's position is that this fee will recover the cost of the transfer station and its impact.

TCV: Will there be any impact of the transfer station on the city of Newark?

Jones: We have been very vocal about this during the environmental review process. The site of the transfer station on [41149] Boyce Road is a mile and half north of the present landfill. Collection vehicles driving to the transfer station are going to travel by different routes; some will use westbound Stevenson Blvd. as their access road which is in the city of Newark. Loaded garbage trucks are heavy and things fall off. This has an impact on roadway trash, dust, dirt, and wear and tear on the roadway. I see a very real impact on the city of Newark.

TCV: Have there been any discussions of this impact?

Jones: Fremont has summarily rejected any discussion of this.

TCV: How will garbage collection rates be affected?

Jones: They are all CPI driven. They will continually escalate; we are estimating the immediate increase will not be significant due to an "Augmentation Fund" instituted several years ago.

TCV: How are you moderating this increase?

Jones: We will be spending $69.90, per ton for disposal as opposed to our current cost of $38.29 but disposal is only one component. Waste Management gets paid for collecting the garbage, so a twofold increase of that cost does not mean an immediate doubling of our rates. In fact, rates are going to initially increase by a much smaller amount estimated at approximately 12 percent.

TCV: Why not stay with Waste Management for disposal? Do they have a transfer station?

Jones: They do have a transfer facility in San Leandro. And we did talk very seriously with waste management because we have a long and very positive relationship with them. However, although they offered a very good deal, use of the BLT facility is significantly less expensive.

TCV: Will the public notice any difference beside rates?

Jones: The only difference is that Newark residents have had limited free use of the landfill through Waste Management. That program is essentially suspended because they don't have control over all the costs anymore. We were one of the last areas with this program.

TCV: Is Newark and Union City negotiating with Fremont as a bloc?

Jones: Yes. We got together at the end of last year since we had a common interest.

TCV: After the Durham Road Landfill is closed, where will trash be hauled?

Jones: To the Altamont Landfill. At this time, I don't think that that landfill is in jeopardy. There are a number of provisions within the contract that, if in fact, the Altamont Landfill were to become unavailable, there would be a cooperative effort by the three cities to find an alternative. This is a Fremont contract putting them in the driver's seat. We offered to partner with Fremont many years ago to look at long-term solutions they decided they wanted to do it themselves.

TCV: Is landfill space a problem for other areas?

Jones: Absolutely. Landfills around here that are close, convenient and economical to use are all filling up. We need to go farther away to be able to find landfills that are acceptable to their surrounding areas, and accessible by the people that need to get to them.

TCV: Isn't there a landfill at the end of Dixon Landing Road?

Jones: Yes but there are a number of significant hurdles when transferring waste outside of Alameda County.

TCV: Have these negotiations had an impact on city to city relations?

Jones: This has had an impact on our relationship. It changed the rules of engagement a bit between the cities. We still cooperate and do lots of really good things together to make the best business decisions for our community. However, we are now acutely aware that sometimes priorities and how we support each other change. We pay attention to that, more so than we did before. It's a change from covering the costs of good service to determining what the market will allow.

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