Incentive Programs for Local Government Recycling and Waste Reduction

Case Study: Santa Clara

In the City of Santa Clara, California, the city charges a differential franchise fee to haulers based on whether or not they have a city-approved recycling program. All non-exclusive franchised haulers collecting waste from the industrial areas of Santa Clara must pay the city a franchise fee of 25 percent of their total gross billings (including bin and rental charges). To obtain a reduction of the franchise fee to 10 percent, haulers must to meet at least two of the following conditions:

1. For industrial customers who regularly set out more than nine cubic yards of refuse per week for collection, the contractor must provide containers for and collect 50 percent (by weight) of a customer’s recyclable materials. An initial waste audit for each of these customers is required. If a customer has an in-place recycling program that reduces its wastes by at least 50 percent, the contractor would not be bound to provide containers and collect materials there. The contractor would only need to submit annual certified documentation of that program. A customer may also be exempted from this requirement.

2. Provide a recycling services program and a designated recycling representative to perform these tasks:

• Contact each of their industrial customers at least once every year to discuss the various types of recycling possibilities available for the customers.
• Work with each new customer concerning recycling options.
• Keep written documentation of customer contact and any recycling options implemented. Maintain in contractor’s office for city review.
• Submit a quarterly report to the city documenting the amount of recycled materials collected by weight and type, and the number of recycling customers in the city.
• Maintain a list of customers serviced by name and service address for city’s review.

3. Contractor has another certified and documentable recycling or resource recovery program that reduces the amount of industrial waste being collected by at least 50 percent. Contractor needs to document waste flow for processing and disposal to all facilities and landfills. Certified quarterly reports must be submitted to the city with specific waste flow detail and documentation.

Contractors must pay the 25 percent franchise fee each quarter for all generators with greater than 50 percent recoverable waste in their refuse setout for collection and disposal, until less than 50 percent is achieved. The contractor may submit a new waste audit to the city at any time, to reduce the franchise fees paid for those customers that achieve less than 50 percent recoverable wastes.

The waste audit must be performed and certified by a qualified individual or firm experienced in the waste audit process. Typical qualifications of an individual or firm would be:

• Individual with four-year degree in civil engineering or environmental waste management with experience in preparing waste audits, or equivalent education and experience approved by the city.
• Consulting engineering firm experienced in preparing waste audits.

The city reviews and determines the adequacy and completeness of the waste audit reports. Comments are submitted to the contractor for response, revision, update, and resubmittal of the report until it is approved by the city.

Santa Clara has authorized 15 haulers under its nonexclusive franchise system to collect waste from the industrial areas of Santa Clara. All of the haulers have been certified to obtain the reduced franchise fee.

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Last updated: October 26, 2007