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Trash Wars Trudge On

Marborg Wins Key Battle Over Allied


Thursday, March 24, 2011

MarBorg Industries won a significant battle over Allied Waste, its chief rival for the hearts, minds, and trash cans of South Coast residents, winning the recommendation of county trash planners for much of the unincorporated Goleta Valley. If the county supervisors approve this recommendation on April 5, it will give MarBorg a clean sweep in Goleta, where the combined franchises are worth $6 million a year. (The City of Goleta opted to go with MarBorg late last year over Allied, which had served most of the incorporated area for many years.)

Meanwhile, this Tuesday the Santa Barbara City Council balked at hiring a consultant for $110,000 to help solicit bids for a new garbage franchise agreement for half the city. Santa Barbara’s franchise, which comes due in two years, is worth $8 million a year. Some council members objected to how informally the consultant was selected; others objected that the city would need a consultant after all; and others still, that the city’s solid waste division had sprung a $2-million leak that will require a trash rate increase to be plugged. City Administrator Jim Armstrong countered that for a contract worth $80 million over 10 years, $110,000 was not much to spend for the professional expertise needed to get the best deal possible. (Currently, MarBorg has a franchise for half the city; Allied, for the rest. If MarBorg were to win the bid, it would serve almost the entire South Coast.) Council members opted to revisit the matter in the third week of April so that they can have plenty of time to read the county’s recommendations about the Goleta franchise.

Of the $2-million shortfall, city administrators figured out how to rectify all but $600,000. To bridge that gap, a typical residential ratepayer will pay $1.63 a month more in trash fees, while large businesses will pay $20 extra. Almost half the shortfall can be attributed to a collapse in the world market for recycled materials. Another $500,000 can be attributed to an unexpected loss in revenues from commercial accounts. Two years ago, City Hall enacted a new rate structure designed to strongly encourage recycling — and punish people who didn’t recycle with higher rates. For reasons not clear, the new program generated far less revenue than anticipated. And it remains unclear what effect, if any, it had on recycling.

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