A City Wonders Who’s Supposed to Take Out the Trash

The winds of war are wafting over the city, and once again, it smells like garbage.

Employees at Econo Lube N Tune in the Mission Viejo Freeway Center came to work last week to find that someone had mysteriously replaced their trash bins.

The old containers were shoved away from the building, and in their place sat new trash receptacles from Western Waste Industries, an unfamiliar garbage hauler.

“I was shocked,” said Michelle Franklin, office manager for the Econo Lube franchise. “We asked the trash company to take their cans back and we have put a lock on the gate.”

Since the city last month awarded an exclusive contract worth approximately $3 million annually for commercial hauling to Western Waste, dozens of Mission Viejo businesses are confused over who should be taking out their garbage.

That’s because at least two waste disposal firms which have serviced them for years are balking at leaving town when Western Waste officially takes over Friday.

South Coast Refuse and Waste Management Inc. have said state law entitles them to five years’ notice before being booted out--notice they claim was never given by the city. Mission Viejo officials maintain the law does not require such notice.

In a city that has spent more than $100,000 for legal help in past trash disputes involving rates, both sides are digging in their heels for a battle that will likely end up in court.

“The city can take a flying leap. I’m not going anywhere,” said Madeline Arakelian, owner of Irvine-based South Coast Refuse, who reports doing at least $75,000 in business annually in Mission Viejo.

“The city can’t take away the rights of an individual to do business on private property,” she said. “They owe me five more years.”

*

Although the residential trash contract has been exclusive for almost 20 years, competition for commercial hauling has been wide open. Local businesses were free to sign individual contracts with any waste hauler.

The practice was ended this year when city officials decided to also award an exclusive contract for commercial hauling.

“We thought it would be easier to deal with one company instead of many,” said Danian Hopp, assistant to the city manager. Working with just one trash hauler would also make it easier to meet state recycling requirements, he said.

City officials say that all the companies refusing to leave had submitted bids to become the exclusive franchisee.

“Once they lost out in the competitive bidding process, they came back and started claiming they are entitled to be ‘grandfathered,’ ” said Hopp.

But for local businesses, the result has been confusion.

Several have signed contracts in recent weeks with one of the three warring trash haulers and are now uncertain whether their agreements are valid.

Michael Kelner, general manager of the nonprofit Heritage Pointe retirement home, said that his rates will almost double with the city’s newly chosen commercial hauler. Heritage Pointe had recently signed a contract with Waste Management, locking in the lower rates to June, 1996.

*

Kelner said his company would lose almost $5,000 a year under Western Waste.

Hopp said that cases like Heritage Pointe’s are rare.

“I know in more than two-thirds of the community, rates are going down for businesses,” he said. “That might not be the case in a handful of instances in the competitive commercial areas.”

At the heart of the trash companies’ claim is a state law that requires any waste firm doing business in a city for at least three years be given five years’ notice before its contract is terminated.

“The city knows perfectly well that we’ve all been doing business here all this time,” said Arakelian, owner of South Coast Refuse.

But city officials say that law only applies to companies that have been awarded a franchise contract--not those that compete freely.

“The [five-year] notice is intended to give [trash firms] that have a substantial capital investment in a community a chance to retire their debt,” said Hopp. “It’s not for companies who don’t have a large investment in the community.”

On Sept. 1, the main responsibility for settling the dispute with other haulers will be on the shoulders of Western Waste officials, whose contract with Mission Viejo legally absolves the city in the commercial hauling dispute.

City officials said the first salvo would likely be a letter sent to the rival trash companies asserting Western Waste’s exclusive rights.

Western Waste officials declined to say what they would do next week if the other haulers are still operating in town.

“We’ll just have to go in and start hauling trash as we promised under our contract,” said Waste Waste Division Manager Vic Mazmanian. “I really feel that the situation will be resolved by then.”

Mazmanian said his company began delivering bins to local businesses in advance of Friday’s start date “because you can’t bring in 1,000 containers in 24 hours.”

The firm expects to serve 400 commercial accounts.

At least one hurdle in the dispute may have been cleared after a Thursday meeting between city officials and Waste Management representatives.

“I’m hoping we can resolve everything by next week,” said Waste Management Division President Bob Coyle, who declined to reveal any details.

But Arakelian insists she’s staying in Mission Viejo: “We’ll go through any legal means we have to in order to protect our rights.”

But Western Waste representatives still find confusion among Mission Viejo businesses as they prepare for Friday.

“I feel bad about what’s happening to them,” said Mazmanian. “But we’re not creating the situation.”

Heritage Pointe’s Kelner doesn’t particularly care about who he does business with so long as his rates don’t change and the service is good.

“I don’t give a damn who picks up our contract,” he said. “As long as they honor our contract and keep it clean.”