For Mission Viejo, Getting New Trash Haulers Was Messy

City officials could be excused for feeling, well, dumped on.

In the past seven weeks, the city has been hit with trash collection controversies ranging from a jilted refuse company employee giving the City Council a Nazi salute, to an angry citizen dumping his trash on the desk of a City Hall secretary.

“Trash is a dirty business,” says Mayor Joseph D. Lowe. “There’s so much at stake, things get a little intense.”

The experience of Mission Viejo offers a cautionary tale for at least three other cities--Lake Forest, Tustin and Laguna Hills--that have declared their intention to seek competitive bids on their trash contracts. Those cities say they hope to avoid Mission Viejo’s turmoil.

“Our process will be different from Mission Viejo’s,” said Don White, Laguna Hills assistant city manager. “We did have some things in place in advance of Mission Viejo’s situation. Some of the problems they’re having confirm that we’re going the right way.”

This has been Mission Viejo’s way since the city awarded the contract for residential service to BFI Industries and the commercial franchise to Western Waste starting Sept. 1:

* The city switchboard overflowed with angry phone calls when the new residential hauler missed pickups in several neighborhoods on its first weekend. In some locations, trash piled up on the street for three days.

* Recently, one resident expressed his ire at the pickup schedule by dumping a load of used mini-blinds on a secretary’s desk in City Hall. City officials arranged to get rid of the blinds.

* Four commercial trash firms that had customers in the city and lost out when the city awarded an exclusive franchise have complained about the bidding process, and refuse to make way for the city-appointed hauler, prompting Mission Viejo to file a lawsuit against them.

At a recent City Council meeting, an employee of one of those waste haulers concluded his remarks to council members by giving them a Nazi salute.

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BFI maintains it has worked out much of the kinks in its service.

But for Lowe, the trash fallout wasn’t surprising.

The city had dealt with the same trash hauler, Waste Management Inc., for almost 20 years, “and any time you have a change of this magnitude, you’re going to have problems. This whole thing was pretty new for us.”

Mike Koep, a district manager for BFI, said many cities avoid changing trash companies because they’re comfortable with their old hauler.

But when they do, “I’ve seen instances where it’s literally guerrilla warfare out there.” During the competitive bidding process, he said, “it’s like an auction; there’s a crazy aura around.”

Naturally, money is the underlying issue here. A city franchise can mean big money for haulers. Koep estimated that Mission Viejo’s contract will be worth from $3.5 million to $4 million a year to BFI.

“It’s the one contract that affects absolutely everybody in the city,” White said. “Since everybody is affected, there’s more at stake.”

City officials in Lake Forest, Laguna Hills and Mission Viejo say putting the contract out to bid can mean big improvements in service and rates. Mission Viejo’s rates immediately went down $1.68 per month for each household, saving residents $500,000 per year. When contracts go out to bid, trash companies are forced to shave their profit margin, Koep said.

“Every one of us has bid on a contract, then has had to reduce their operating costs to meet the price we bid,” Koep said.

Cities try to take steps to avoid the frenzy surrounding the bidding, but that doesn’t always work.

Mission Viejo imposed a gag order on trash companies to prevent their lobbying any city official, other than one designated employee, except at council meetings.

“But that was ignored,” Lowe said. “Representatives from these guys called me up anyhow.”

Laguna Hills has a similar provision in place, and White, the assistant city manager, plans on providing more transition time between awarding the contract and allowing a new trash hauler to begin service, if indeed a new hauler is selected.

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While Mission Viejo had 10 weeks between contract award and service start-up, White says his city feels more comfortable with a six-month buffer. The winning firm will be required to turn in a detailed transition plan.

“I think it’s necessary,” White said. “That’s going to be part of the criteria for selection.”

In Mission Viejo, some of the heat has dissipated.

City Hall only gets a couple of trash complaints per day. Waste Management, which had about two-thirds of the disputed commercial accounts, recently agreed to leave the city.

But other trash problems remain, particularly among the other waste firms that say they will fight the city in court to continue servicing their commercial clients.

Despite the city’s trash woes, Lowe said he would leap at the chance to put the contract out to bid again. There would be changes, however, in the way the bidding would be conducted.

“I’d call the CEO [of each bidding firm], sit him down across the table, and I’d lay our standards out to him,” Lowe said. “And tell him that if he couldn’t meet the standards, to back out of the process.”