Increasing Commercial Diversion

Tuesday, April 20, L.A. County Sanitation Districts,
Organized by the Southern California Council on Environment and Development
[Summary report prepared by Jim Stewart]

WELCOME AND PURPOSE OF FORUM 

Joe Haworth , Public Information Officer for the Sanitation Districts of L.A. County: We welcome you. The Districts are pleased to be a supporter of SCCED. 

Kathleen Gildred , Director of SCCED: This forum is a follow-up to the “Getting to 50%” conference we held in June 1998, which was designed to help municipalities achieve 50% diversion by 2000. Following that conference we sent out a questionnaire to get your priority interests, which we have used to plan this forum series. 

EXECUTIVE SUMMARY 

Dr. Eugene Tseng , UCLA Extension Waste Management and Recycling Program: We are reporting preliminary findings on the first thousand waste audits of businesses. Waste prevention/recycling provides big cost savings. Go after big businesses first. The larger 20% of businesses have 90% of any additional potential diversion. 

Lupe Maria Vela , Director, Solid Resources Citywide Recycling Division, Bureau of Sanitation, Los Angeles Department of Public Works: We established partnerships with businesses and developed over 50 publications to provide guidance for commercial recycling, accomplishing 45% citywide diversion for 1995. 

Dean Richardson , Raytheon Hughes West: We are now at a 35% diversion rate, our goal is 50% for this year and we are going for 70% the following year. We recycled white paper and cardboard and achieved a diversion rate of 21%, with revenue/cost avoidance of $25,000. In 1998 we diverted or recycled nearly 500 tons of solid waste, scrap metal and surplus equipment for a savings of over $750,000. 

Bruce Dolezal , Gillette Company PaperMate Division: We recycle all metals, oil, and plastics. We have found recycled pallets cost effective. The overall result is 80% diversion. We have also had a 95% reduction in hazardous emissions since 1987. 

Joe Sloan , Director of Market Development for Consolidated Disposal: A hauler can: (1) Spread the message about recycling/diversion, (2) Provide separate pickup of recyclables, (3) Direct the material into a MRF, which can recover 25-40%. 

Mark Harmon , Integrated Waste Manager for the City of Claremont: A successful commercial recycling program is a partnership between the public agency, commercial customer and the hauler, with one goal: Develop a cost-effective customer friendly, environmentally responsible, operationally feasible and legally compliant program. 

WORKING WITH BUSINESSES 

Jaime Lozano , City of Carson Waste Management Specialist: Carson has a proactive AB 939 compliance program, concentrating on public-private partnerships. This means we must get the cooperation of the business sector and the haulers. 

Dr. Eugene Tseng, has worked with the CIWMB on quantification methodologies, to identify how much diversion is actually occurring. He has worked with the USEPA, United Nations, China and elsewhere in designing and teaching these methods. 

Survey of 1,000 Businesses on Potential Source Reduction and Diversion 

Dr. Eugene Tseng , UCLA Extension Waste Management and Recycling Program: 

We have completed 2,000 waste audits of businesses. I am reporting our preliminary findings on the first thousand businesses. 

The waste management hierarchy is (in order of decreasing desirability): 

1. Source Reduction , which includes Waste Prevention, Waste Minimization, Reuse and Repair, and Improved Durability 

2. Recycling, which includes Pre-Consumer Recycling (Internal Recycling), Post-Consumer Recycling, and Composting 

3a. Environmentally-Safe Transformation , such as Waste-to-Energy (Incineration, etc.) to use the “energy content” of solid waste 

3b. Environmentally-Safe Landfilling 

Diversion is classified as #1 and #2, but Transformation (such as Waste-to-Energy) and Biomass is eligible for Year 2000, under certain conditions. 

According to CIWMB Regulation 30 PRC 40196: “Source Reduction” means any action which causes a net reduction in the generation of solid waste. “Source reduction” includes, but is not limited to, reducing the use of nonrecyclable materials, replacing disposable materials and products with reusable materials and products, reducing packaging, reducing the amount of yard wastes generated, establishing garbage rate structures with incentives to reduce the amount of wastes that generators produce, and increasing the efficiency of the use of paper, cardboard, glass, metal, plastic, and other materials. “Source reduction” does not include steps taken after the material becomes solid waste or actions which would impact air or water resources in lieu of land, including, but not limited to, transformation. 

We are currently working with CIWMB on the methodology of establishing a new base year for 2000, because the present base year data are faulty for many jurisdictions. 

Our research goals in the UCLA Waste Management and Recycling Program are to: develop recommended approaches, do sampling/targeting of various types of business, develop audit protocols, and collect and analyze data. We want to learn how to quantify source reduction and diversion and how to tie the calculations to the jurisdiction’s calculation methodologies. We also want to identify exemplary business programs, such as Disney, which is trying to reduce waste by 50% through source reduction. 

Purposes of a Waste Reduction and Recycling Review include: 

1. Reducing Costs through reduced disposal costs, more efficient use of materials, and reduced liability (e.g., less hazardous wastes). 

2. Corporate Greening through use of non- or low-toxic substitute materials, use of recycled content feedstock, product design for increased recyclability, process design for minimum waste. 

Process of an audit includes analysis of: 

• Shipping / Receiving / Inventory Control 

• Materials Utilization, including type of materials and efficiency of use 

• Waste Management and Collection Procedures 

• Recycling Practices, including: 
Disposal Practices / Contamination Issues 
Waste Characterization 
Disposal Sites Utilized 
Service Costs 

• Environmental Management Infrastructure, including: 
Corporate Policy and Commitment 
Management Organization 
Education and Outreach Efforts 

The audit looks at each function where trash is created, asking the following questions: 
• What is the material? 
• Who and what generated the material? 
• How and why was it generated? 
• Could it be avoided altogether? 
• Could it be reduced? 
• Could it be recycled? 
• What is the best “disposal option”? 
• Factors to consider include: 
a) recycled content 
b) designing for recyclability 
c) designing for minimum waste 

We have verified the theory that if you concentrate on the largest 20% of the businesses, you will be dealing with nearly 80% of the total commercial waste. Jurisdictions with large businesses will have 40-80% of the existing commercial diversion. Additional potential diversion businesses can do themselves could add 5-15%. Smaller jurisdictions with smaller businesses have 25-40% existing diversion rate, with an additional potential diversion of 3-10%. 

Summary of lessons learned: 
1. Waste prevention can be a significant help. With an average existing internal diversion rate of 25% already being accomplished by the businesses, only an additional 25% of the waste stream must be diverted to reach 50% diversion. For haulers that guarantee a 50% diversion rate, it is only fair to give credit to the hauler for the diversion that has already taken place before they pick up the trash. 

2. Waste prevention/recycling provides big cost savings. 

3. Hauler recycling accounts for a small percentage (less than 10%) of the actual diversion, the other 90% is internal diversion. 

4. Go after big businesses first. The larger 20% of the businesses have 90% of any additional potential diversion. 

5. Could do a regional MRF to increase diversion in smaller businesses because it may not be cost effective for individual small businesses to set up recycling programs. 

We are doing audit training sessions with CIWMB staff and could do similar training for city and county staff. Scheduled date is June 28 to 30, 1999 in the Los Angeles Area. Please contact Eugene Tseng for participation in the training session with CIWMB staff on conducting Waste Reduction and Recycling Audits. 

Los Angeles Strategies for Commercial Recycling 

Lupe Maria Vela , Director, Solid Resources Citywide Recycling Division, Bureau of Sanitation, Los Angeles Department of Public Works: 

Following a 1995 analysis of overall city waste composition by generator, the Los Angeles City Council decided to emphasize commercial and residential recycling. The Integrated Solid Waste Management office has developed a lot of recycling programs. Susana Reyes heads up the program which is encouraging all City departments to buy recycled products. 

The Solid Resources Citywide Recycling Division was created in 1998, with 26 staff from various groups, including ISWMD, to oversee citywide recycling programs. 

Our responsibilities include: 
• AB 939 monitoring and report preparation 
• Oversight of AB 939 implementation in all City departments 
• Providing commercial, industrial and multi-family recycling assistance 
• Recycling organics contact and marketing activities (we are looking at developing our own composting/mulching operation run by city employees) 
• Household hazardous waste and used oil collection program 
• Market development for recycled materials and products 
• Biosolids contract development and education 

City Approach : We started in 1990 to look at generation, disposal and diversion. We targeted 24 generator groups and established 24 working groups, hotels, grocers, schools, etc. The groups develop their own targets and decide how they can help, we do not mandate. We targeted 6 groups per year and have established partnerships and developed over 50 publications to provide guidance to businesses in the various generator groups. We have published a Recycling Resources Catalog with an order form for our publications, nearly all of which are free. You also may use them for your municipality, as long as you give us report credit. 

We have spent a lot of effort on monitoring and uating results. We have surveyed 1200 diversion facilities and 300 disposal companies so we have a good idea of the recylclables and solid waste flow in the city. From 1995 through 1997 we have disposed about 3.5 million tons each year, so it is about constant even though population is increasing. Our diversion is improving, in 1995, it was 44.5%, in 1996, 46.1%, and in 1997, 46.6%. Our 1995 AB 939 report cost $75 for consultants, but it is free to cities. The City government diverted only 29% in 1995, but the commercial/industrial sectors diverted 71%. 

Strategies Beyond 95 :
• Maximize commercial diversion programs, working with CMRA recycling association 
• Focus on C&D and paper recycling 
• Focus on the 19 major City departments 
• Emphasize offices, schools, grocers, printing and multi-family buildings 
• Prioritize source reduction/reuse programs 
• Buying recycled is a crucial part of any program 
• Documentation 
• Staff development so they are familiar with a variety of issues 
Our 2000 strategy was developed in 1998: 
• Office building promotional campaign, in which we look at successful offices and ask them to be co-sponsors and join in leading the campaign to involve the 1000 largest office buildings 
• Waste characterization/diversion studies (2 year effort, 2000-2001), in which we will sample 1400 businesses of all types 
• Reuse/take back outreach, starting with electronics, we will ask large retailers to get out information to the public on where to take electronics back for reuse. This should be a regional program which we invite other cities to join 
• Concentrate on targeted materials: C&D and paper 
• Institutional recycling in schools 
• Smart gardening, including composting, grasscycling, may 22 we launch “mow down pollution,” featuring mulching mowers at Home Depot 
• Buy recycled programs and market development 

Summary of Results: 
• Diverted 46.6% in 1997 
• Established recycling business network, our guidebooks have all been done in partnership with businesses 
• Award winning programs, including the CIWMB Trash Cutters award in 1998, selection as one of 32 “Best Practices models in the U.S., 1999 best organics program, CRRA 

Future Outlook: 
• More positive State legislative environment, including SB 332 expansion of the bottle bill to include all bottles, SB 110 strengthening recycled plastic content in food and cosmetic containers 
• Stronger City Council positions, including resolution condemning the Miller Beer composite metal/plastic bottle (it has 2 PET layers and 3 other types of plastic with a metal cap and a metal label. Councilmember Ruth Galanter’s resolution said the City would submit a bill to Miller for the additional cost of recycling. Miller’s response so far was to say they would add 25% recycled plastic content. 
• City’s aim for 70% diversion/recycling by 2020 
• Integrate other issues into workshops, including pesticide concerns, storm water pollution, buying recycled 
• Look for source reduction opportunities 

Lozano: Fox Electronics of San Jose will accept shipments of old electronics, if we are willing to pay the shipping costs. 

Report from Businesses on How We Reduced Waste and Saved Money 

Dean Richardson , Raytheon Hughes: 

Raytheon Hughes West is now at a 35% diversion rate, our goal is 50% for this year and we are going for 70% the following year. 

Our driving force is not AB 939, is not being green and is not even cost savings (because often it takes money to save money). Our driver is intra company competition. Our new Vice President says the Texas Instruments Division recycles 70-90%, “Why aren’t we doing that?” 

In 1994 I tried to develop a corporate wide recycling program, but couldn’t get anywhere — our diversion rate was 6%. Then in 1997 Raytheon became part of General Motors and developed a national solid waste contract. Management pushed recycling as revenue source (from reduced waste collection), not for waste reduction. 

In the first year, with no budget or resources, we recycled white paper and cardboard and achieved a diversion rate of 21%, with revenue/cost avoidance of $25,000. In 1998 we diverted 31%, recycled 2,013 tons of solid waste, for a cost avoidance of $44,000. We won some awards, we became sponsors of America Recycles Day. 

This year we put 2 containers in every office cubicle, for trash and for recyclables. Our goal for 1999 is 50%. We are doing recycling, source reduction, subcontract restructuring , communication, benchmarking. We are expecting a cost avoidance of $58,000. We are going beyond white paper to recycling anything that tears. We have involved the janitorial staff. To go beyond that we need some seed money, which is hard to get. 

In terms of source reduction, we have asked our office supplies vendor Boise Cascade to provide recyclable office supplies. We are also requiring 2-sided copying and use of electronic mail (we are not distributing office phone books, making directories available only on email). Cardboard recycling has gone from 193 tons in 1998 to an expected 312 tons in 1999. Our cafeteria tray reuse program is saving 9,000 pounds/month, for a $4,000 cost avoidance. We have asked Boise Cascade to use reusable supplies distribution containers, to eliminate cardboard shipping boxes. We also have asked our landscaping services contract to recycle greenwaste, and leave grass clippings on the ground. We recycled 56 tons of scrap metal for a savings of $27,000. Recycling surplus equipment was about 410 tons for a savings of $688,493. 

The key is strong management support. Our CEO Dan Burnham is aggressive on the environment and on safety issues. Also important is communications with the employees and vendors to reduce waste. Benchmarking is helpful. We are using the OPM scoring system in which we multiply the amount for each of the categories by a weighting factor to track our progress. Awards and commendations are very helpful, such as the WRAP award. 

Bruce Dolezal , Gillette Company PaperMate Division: 

The Santa Monica PaperMate Division produces over 1 billion writing instruments annually using 300,000 square feet of space. Gillette’s mission for years has included the statement: “Our products will be safe to make and to use, we will conserve natural resources and will continue to invest in a better environment.” 

Each manufacturing facility business plan has critical success factors which include hazardous waste reduction, energy conservation/optimization, recycling programs, etc. We look at each waste stream to determine the quantity of waste generated, where it can be recycled, the cost to recycle, the cost to dispose, the cost to replace, and the overall total cost savings from recycling. For example, we have the plastic waste from the mold runner recycled at the machine instantly. Rejects from the manufacturing process are ground up and recycled at the plant. 

We are driven by doing the right thing. For example, machine and hydraulic oil is recycled in-house. We have found recycled pallets cost effective. We recycle all metals. Even extruded PVC has some markets. We reuse corrugated tote containers until they fall apart. Whenever we are doing construction or remodeling, we recycle everything we can. Customer returns are ground up and sent to a waste-to-energy facility. We will accept bulk shipments of disposable razors and recycle the materials. Our office recycling program mixes all the paper together for convenience, rather than separate out white and colored paper. 

The overall result is 80% diversion. We have also had a 95% reduction in hazardous emissions since 1987. We have eliminated use of ozone depleting compounds. We also have a ride sharing program. 

We have made significant reductions in overall product packaging since 1990. We have just produced the “Eco-pen,” made from recycled materials. We have increased energy efficiency 40% and water efficiency 51% since 1990. 

WORKING WITH HAULERS 

Kim Braun , Solid Waste Manager for the City of Santa Monica: Working with haulers is important because to get our city diversion rate up, we have to ensure the private haulers are doing the diversion from commercial facilities. 

How Haulers Can Help Increase Commercial Diversion 

Joe Sloan , Director of Market Development for Consolidated Disposal: 

We have designed and implemented many waste programs including specialized pickups, commingled recyclables, and dirty MRFs. Our industry is basically a transportation business, so we are similar to the Post Office, UPS, or any delivery company. 

As someone said, we create trash with capitalism and collect it with socialism. 

Haulers can help you with commercial diversion. The challenge is to make it work for both the hauler and the business. Business people look at the bottom line. 

We can pick up most efficiently on routes where the customers are most dense, and we have uniform containers so we can use the same vehicles. In our survey of 5,000 customers, we found 45% of our revenue from 60% of our customers have us pick up 1 or 2 3-yard bins once a week. 

Only 10% of commercial diversion is attributed to the hauler, but most of your ordinances, permits are directed to the hauler. But haulers find all the recyclable plums are already picked out of the commercial trash, so there is nothing of value left in the trash. 

Avon saved $90,000 per year doing recycling, but small generators cannot achieve this large amount of savings. If a customer used a 3-yard container, we could give two 1.5-yard containers instead to separate plastic, white paper from the trash, it will actually cost him more because we need to send two trucks to the same place. In the last 12 years there was only one brief time when the value of recyclables exceeded the cost of pickup. 

Haulers can provide some technical services, but the municipalities should hire consultants to do this. A hauler can: 
1. Spread the message about recycling/diversion. 
2. Provide separate pickup of containers for recyclables, even if it costs more (or you can provide the hauler with a reduced rate structure for recycling services if you wish). 
3. Direct the material into a MRF, which can recover 25-40% of a mixed commercial waste stream. This is the cheapest way to get the diversion because we only have to pick up one container. 

Question: Is 25% recycling from a MRF typical? 

Sloan: Yes, because businesses have already pulled out the recyclables from the waste stream. The MRF provides the lowest cost per ton. La Mirada, Norwalk, and San Gabriel require waste to go through a MRF 

Question: Isn’t diversion reducing the hauler’s income? 

Sloan: Haulers have implemented a lot of recycling programs, but gross revenues have still increased. The new legislative requirements make it more difficult for the smaller haulers. 

Working with Haulers from the Public Sector Perspective 

Mark Harmon , Integrated Waste Manager for the City of Claremont: 

Our department has 25 employees that provide: 
• Full service trash and recycling collection program 7 days a week. 
• Commingled recycled program with MRF-processed recyclables. 
• Variable sanitation rate with recycling costs as part of the commercial rates, so there is no separate fee for recycling. We charge people on basis of how often we pick up. If you add fees for recycling, it is a disincentive. We think everybody should pay for the programs to implement recycling. (If you don’t separate out the recycling fee, you can keep away from Prop 218 problems.) 
• Full cost accounting system. Our Enterprise Fund means we have to recover all of our expenses from the customers. 

The program has three players: 
• Commercial customers who want a clean, efficient service at a cost comparable to neighboring businesses and/or communities. The recycling program is perceived as environment-friendly thing to do. 
• Haulers who want full cost recovery for collection services and compliance with municipal contracts. Quality customer service is important to them, but the companies answer more to Wall St. (or company headquarters), not to Main St. (or the local community). 
• The public agency which is concerned with public policy and law, legislative compliance (AB 939, etc.) and environmental responsibility. They are sensitive to rate impacts on commercial customers (because it may affect the tax rolls). 

All three meet in the middle with the same goal: Develop a cost-effective customer friendly, environmentally responsible, operationally feasible and legally compliant commercial recycling program. 

Steps toward achieving this goal include: 
1. Identify your waste stream and the business composition of your community. Look at your SRRE and waste audits. Decide what materials to target. The majority of commercial recyclables are usually one or two commodity types. After you identify those, focus on the businesses that produce the highest percentage of these materials. 
2. Clearly define your measurable diversion goal, it can be a percentage, tonnage or participation rate. 
3. Create a partnership with your hauler to develop programs to meet your goals. Be prepared to discuss program options, contract modifications, and rate impacts. If a dirty MRF that costs $70/ton is too expensive, what about a clean MRF? In terms of rate impacts, do you want a low rate or do you want to increase it a little to add recycling pickup? Don’t ask a hauler to accept the value of recyclable materials as full payment, the market for these commodities is too unstable. 
4. Present the program to City Council and the business community (include the Chamber of Commerce). Explain how the program works, prepare printed materials. Educate business community as to the: 
– environmental benefits 
– diversion goals 
– rate impacts 
5. Measure success of the program. 

In conclusion, a successful commercial recycling program is a partnership between the public agency, commercial customer and the hauler. An appropriate recycling program should address the concerns or needs of all the players.