The Anaheim City Council unanimously decided Tuesday night to grant a 20-year contract to Republic Services, the city's waste hauler since the 1940s.
The extension, which adds 13 years to Republic's current seven-year contract, comes after a $20-million remodeling of the waste hauler's materials recovery facility, a 250,000-square-foot site where trash is sorted and recyclables are sold.
The facility helps the city divert 61 percent of its trash away from landfills, according to Ric Collett, Republic Services general manager.
As of 2000, state law has required cities to divert 50 percent of their waste. Assembly Bill 341, which was signed into law in October, calls for a statewide goal of diverting 75 percent of waste.
The waste contract did not go out to bid, but sources familiar with the waste hauling business say that's not unusual.
If the city were to contract with another waste hauler, that company would probably have to build another materials recovery facility, said Dean Ruffridge, senior vice president at the waste hauling firm CR&R.
"Just imagine the investment. The rates would actually go up," Ruffridge said.
Republic remodeled the part of its facility that handles garbage collected from city curbsides. The waste hauler installed new technology to more efficiently sort the trash, including an optical sorting machine that identifies material by measuring its opacity, said Bill Taormina, a Republic consultant.
Taormina's family controlled the business until it merged with Republic in the 1990s, and Taormina is still heavily involved with the firm. He remains a high-profile businessman in Anaheim and a regular contributor to City Council campaigns.
Residents will be charged $19.53 per month, a rate that will remain unchanged the first year but then will be increased annually based on the U.S. Consumer Price Index.
Republic also pays the city a host fee that amounts to at least $1.2 million in revenue for the city, according to a staff report. The city will also be receiving a one-time contribution of $2.5 million for infrastructure improvements.
The waste hauler plans another renovation of its facility, which will cost another $20 million, Collett said. The next remodeling will help the city increase to 75 percent the amount of trash it diverts from landfills, he said.
The remodeling will focus on commercial waste lines to divert garbage like food waste, Collett said.
"If people really understood what happened to that trash, they would say its the best deal," Collett said.
— ADAM ELMAHREK