Private garbage collection will save money but Calgary shouldn't do it, suggests report
Committee wants greater input from industry, which wasn't consulted for report
A new report going before a council committee on Wednesday says Calgary could save roughly $850,000 a year by privatizing roughly a third of the city's garbage pickup — but it also says the city shouldn't do it.
The move would be too risky and could lead to worse customer service, concludes the report.
But the chair of the committee has questions about the report's accuracy.
"There's quite a few contradictions as you go through the report," Coun. Ward Sutherland, chair of the Utilities and Corporate Services Committee, told the Calgary Eyeopener prior to Wednesday's meeting.
"One of the main things is industry actually wasn't consulted, and that really alarms me. So there's a difference in costing from what the industry perceives what the costs [are], and there's a lot of padding in the report on some of the expenses."
Cam Hantiuk with the Alberta Waste Management Association — which represents 12 waste management companies — says no one in their group was consulted. And they'd like to be.
Hantiuk said he's happy the committee voted in favour of deeper industry consultation on this issue Wednesday morning.
But city council still has to vote on the issue before city administration can begin those discussions with industry members.
"We aren't presupposing an outcome," Hantiuk said. "We just simply like the idea of being included when it comes to the work that our members do every day."
Hantiuk , he said years of experience and research tell him that cities generally save anywhere from 15 to 40 per cent through privatization.
"Even the report writer himself … he indicated that, in the Toronto experience when they introduce competition in parts of the city, that the public sector service delivery got better," he said.
"So not only are there cost savings, but you can migrate efficiencies from the private sector to the public sector, and everybody wins."
Coun. Sutherland takes issue with some of the report's statements. In particular, the document says Calgary has some of the best buying power for trucks. But Sutherland says "that simply isn't true."
"There's large companies out there that do $4 billion a year in the industry, and their buying power is a lot better," he said.
Sutherland also noted private industry uses trucks for about 10 years before they replace them, while the city replaces its trucks after seven or eight years, which will cause costs to be higher.
"We need to flesh out a lot of these inconsistencies."
Coun. Druh Farrell was the only committee member to vote against doing more industry consultation.
"The experts that were contracted out have huge experience across the country. They've done a lot of studies in this area," she said.
"Perhaps the recommendations or the findings were not what [the committee] wanted to see."
Farrell said she thinks it's a knee jerk reaction to believe privatization will be cheaper in the long run.
"What experience shows is that it may be cheaper with the initial contract, but the costs go up over time," she said.
Farrell said the city has the advantage of being able to coordinate resources across departments, and she worries if the same could be said of various public contractors.
"That cross pollination that we've seen when there are crises in the city [like] Snowtember, the big snowstorm in October, [and] certainly the flood — where they were all city employees, and we pitch in where we're needed — that goes away when you've got privatization."
Sutherland said Wednesday's committee meeting is part of an overall strategy by council to look at a number of services where costs might be reduced through privatization.
If council approves the committee's motion, administration will begin industry consultations, and the committee will evaluate their findings in 2020.
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With files from the Calgary Eyeopener and Lucie Edwardson