BioCycle February 2005, Vol. 46, No. 2, p. 22
The City and County of San Francisco is making great strides towards its 75 percent diversion goal, using a 3-stream sort system for residential compostables, recyclables and trash, and an aggressive commercial and institutional program for food scraps.
BIOCYCLE has been tracking the evolution of the City and County of San Francisco’s recycling and composting initiatives for almost ten years. San Francisco has been a pioneer in source separated organics diversion. It is the only city in the United States that is fully committed to a three-stream sort program for residential MSW. Jack Macy is the Commercial Recycling Coordinator for the City and County of San Francisco, Department of the Environment. For eight years, he was the Department’s Organics Recycling Coordinator, where he helped develop citywide food composting programs.
BioCycle contributing editor Molly Farrell recently interviewed Jack Macy as part of this issue’s West Coast Conference Preview. Macy will be speaking at the BioCycle West Coast Conference 2005 (March 7-9 in San Francisco) in a session titled, Key Composting, Organics Recycling Trends, 2005 – 2010. He will be addressing strategies to increase residuals recovery at the municipal level. This interview updates overall program activity, as well as discusses the critical issue of setting rates to provide the residential three-stream sort service.
Q: What led San Francisco to commit to a full-scale residential and commercial organics diversion program, while other major U.S. cities have stayed away from such initiatives?
A: The California state legislature passed a law in 1989 requiring municipalities to divert 50 percent of their waste from landfills by 2000 or pay a $10,000 daily fine once the deadline passed. By the mid 1990s it became clear that we needed to collect food scraps to get to 50 percent diversion because yard trimmings account for only five percent of San Francisco’s waste stream, given the city’s density and small yards. In 2002, the city and county of San Francisco Board of Supervisors adopted the goals to divert 75 percent of the city’s waste from landfill by 2010, and 100 percent of its waste by 2020. San Francisco’s diversion rate was 63 percent in 2002 and it is expected to be similar for 2003.
San Francisco has a population of nearly 800,000 in 47 square miles, with 40 percent who don’t speak English at home; daily commuters into the city increase that population by about 50 percent. While these demographics are challenging, we have achieved a lot in a relatively short time. City officials and staff in partnership with the city’s exclusive trash service provider, the Norcal companies, made the commitment to diverting source separated organics from the landfill. We took the state’s mandate seriously, and we have met – and gone beyond – the 50 percent diversion rate. We also recognized that compost produced from diverted organics helps sustain healthy landscapes and agriculture. Moving towards sustainability is a key goal for the City and the primary mandate of the Department of the Environment.
Q: Can you provide the highlights of the residential source separation program known as Fantastic Three?
A: Each household receives three 32-gallon, colored carts that are collected weekly: a black cart for trash to landfill, blue cart for mixed fiber and container recyclables, and a green cart for all food scraps, yard trimmings and other compostables. Residents pay extra if they put out more garbage than what fits in the black cart, but can put out additional recyclables or compostables without a surcharge. The Fantastic Three program has been completely rolled out to the city’s nearly 150,000 single-family households, that is those with individual garbage accounts. In the Fantastic Three program, residents pay a monthly fee of $19.94/month (about average for the San Francisco Bay Area).
Q: What determines the rate per household?
A: Residences pay for the volume of their black trash cart. The standard container size is 32-gallons, but some use 64-gallon containers. By separating their recyclables and compostables from their trash, some households can go from a 64- to a 32-gallon container, and some from a 32- to a 20-gallon container, and thereby reduce their service costs.
Q: What is the household participation rate?
A: We’re not tracking the exact participation of households on an ongoing basis. In the Fantastic Three program, materials are collected from single and multifamily residences and small businesses on the same truck. Unless we go through and do an actual count of all the households that set out, we can’t get an exact household participation rate.
San Francisco measured exact participation back in 2000. The average weekly setout participation rate for compostables was about 40 percent, while recyclables were almost twice that. Over a month’s span, the average participation rate was nearly 60 percent for compostables. We believe these rates are similar now based on anecdotal observations. It varies by neighborhood and by week. In terms of the quantity of material set out, Sunset Scavenger Co., the primary Fantastic 3 service provider, projected back in 2000 an average of about eight pounds per drive-by for households in order to predict the routing and vehicle needs for a citywide rollout.
Q: Is collecting compostables from multifamily buildings next, or do they already receive service?
A: Multifamily is generally considered to be over five households in a building or those that do not have individual garbage service. The priority in rolling out the Fantastic 3 program was to first provide single-family households with both recycling and composting service and for nearly all apartment buildings to receive recycling but not automatically composting service unless specifically requested and coordinated by a building representative. With apartment buildings, special arrangements have to be made to coordinate distribution of kitchen pails and participation by tenants for composting. This coordination and ensuring quality control for composting at apartment buildings adds another layer of difficulty to the program.
At multifamily or buildings with six or more units, information was posted about the availability of the food scrap composting program and that a building can sign up if someone in the building (a tenant, building manager or property manager who lives on site) agrees to be the coordinator. Currently, there are about 200 buildings participating that have more than six units. The largest has less than 50 units. We have been working with and provided a grant to the San Francisco Apartment Association to develop and distribute outreach material for managers and to identify and work with 15-plus buildings to set up composting and increase recycling. We’re planning to do more work in this area, including providing on-site technical assistance and training using our consulting team at Applied Compost Consulting, who has been doing composting training work for commercial participants, and its subcontractor, Environmental Science Associates, who has experience in multifamily recycling.
European countries with many year’s experience in composting programs have found collecting separated food scraps at larger multifamily buildings the biggest challenge. For us, this is one of the city’s final frontiers to penetrate. We don’t expect everyone to participate in the food scraps program. While there is a fairly high participation rate now in single stream recycling, we don’t expect as high a participation in food scrap collection.
Q: Have you thought about making the Fantastic Three program mandatory?
A: The program is still voluntary, but we’re considering pushing for mandatory. If it becomes mandatory and some people still decide not to participate, then they would likely have to pay a lot more through their garbage rate.
We have the infrastructure to get to 75 percent diversion by 2010 but need to increase participation in our programs. To achieve a big increase in participation we believe that making Fantastic Three mandatory may be necessary, including possibly the food scrap collection program. The combination of mandatory and good financial incentives would yield the best participation levels. It’s one of our policy goals to start pursuing in the coming year. Ideally, we would like to get it in place in mid-2006 or soon thereafter and have it dovetail with the new rate structure currently being negotiated. It will likely be a long process to get our Board of Supervisors to adopt a comprehensive mandatory ordinance.
Q: Of total waste generated in San Francisco, what is the split between commercial and residential?
A: In San Francisco, the commercial sector generates about two-thirds of San Francisco’s garbage and the residential sector the remaining one-third. Total MSW generation in the city and county of San Francisco, using 2002 data, is about 1.8 million tons. Of that, we estimate that nearly 400,000 tons are compostable organics.
Q: What is the status of commercial composting participation and diversion?
A: Participation by businesses and institutions continues to grow and we continue to reach out and work to bring more on the program, with a priority focused on getting all large generators on board. Large generators now on the program include hotels and most convention facilities, SF Giants ballpark, regional supermarket distribution centers, and high volume markets, restaurants and cafeteria meal programs. We also continue to get more small generators joining the program, including coffee shops, juice bars, delis, fire stations and others. We now have nearly 2,000 businesses and institutions participating in the composting program, diverting over 300 tons/day – including residential – or about 80,000 tons/year total through the Norcal companies.
Q: What do businesses use to store their compostables?
A: The large majority of small businesses and even some large commercial customers are using Toter brand wheeled carts, either 32- or 64-gallons, that are collected by their service provider. Customers may use the wheeled carts in the kitchen to collect the food scraps and then bring them out for curbside collection, where they are tipped directly into the truck. This minimizes handling by the customer. To accommodate more limited space, many customers use the smaller 23-gallon Toter brand rectangular Slimline containers to sort the food scraps in the kitchen and then empty the material into the collection container serviced by their hauler. Many different sized containers can be used to collect compostables – from Toters to yard bins to rolloffs or compactors. Containers are provided for free – the Slimlines by the City for kitchen sorting, and the collection containers by the service provider who collects them.
Q: What is the next frontier for the commercial program?
A: Norcal’s Recycle Central MRF at Pier 96 in San Francisco has processing lines for recovering both the Fantastic Three residential and small business mixed recyclables and for sorting more mixed office building or other commercial material with a high percentage of recyclables in it. When the cafes, restaurants or other food service operations at an office building are successfully added to the composting program, the building’s remaining waste is much cleaner and higher in paper for potential sorting of recyclables at Pier 96 – even without extensive source separation. This is happening at many office buildings in San Francisco.
We have been working with Norcal to implement a number of programs to improve the recovery of recyclables and increase the efficiency of sorting office building waste. These include two stream desk-side programs with mixed recyclables going into the larger receptacle and nonrecyclables, including employees’ lunch leftovers, going into a small “trash for landfill” bin or caddy. Recyclables could be loose and not in bags, especially if there is separate bottle and can recycling, while nonrecyclable trash is in bags. While it is certainly important to keep bottles and cans out of the composting stream, it also can help in recovering paper to reduce the amount of bottles and cans that have to be sorted from the office paper grades. To help improve sorting efficiency and increase recovery of recyclables, customers are being encouraged to use clear bags to help identify and keep recyclables clean of wet trash. Using clear bags can facilitate cocollecting separated recyclables and nonrecyclable trash in the same container, such as a compactor for a large building, which is often needed given space constraints.
A few buildings, with motivated tenants and managers, have even started collecting food scraps from offices. They are using either 3-gallon buckets or 32-gallon Slimlines that they feed into a composting collection for the building.
SETTING RATE STRUCTURES
Q: How are the residential and commercial rates set?
A: Residential rates are approved by a city Refuse Collection and Disposal Rate Board, established through a 1932 city ordinance – which also created our exclusive permitted hauler system with the Norcal companies as the city’s sole trash collectors. The Rate Board consists of the City Manager, the Controller and Public Utilities Director. Rates are set upon the analysis and recommendations of city staff, including our recycling program. We worked with the Norcal companies to determine the recycling and composting programs that we needed in order to achieve our diversion goals and then reviewed Norcal’s projected costs and revenues for all the programs. While commercial rates are not legally approved by the Rate Board, the program, cost and revenue assumptions for the commercial sector are evaluated as part of the process. In the last rate review, Norcal agreed to provide a 25 percent composting rate discount and free source separated recycling, and only increase commercial rates by the same percentage as residential rates. The rates for trash service were set to help cover overall system costs, including recycling and composting service, and to provide rate discount incentives to program participants.
Q: What goes into the calculation for setting the rate for a commercial generator? Is it frequency, size, container?
A: The trash rate is based on container size and collection frequency. The minimum frequency is weekly collection for trash, compostables or recyclables. The 25 percent discounted rate for collecting compostables is off the standard trash collection rate at a given service level. Recyclables (e.g., bottles, cans, paper and clean cardboard) get collected for free so there is a lot of opportunity to save if the business reduces its garbage service, which is not hard to do.
Q: Are there problems with the current commercial rate system?
A: The biggest challenge in the current discounted rate structure for composting collection is providing a financial incentive for those businesses that are at either the very low or high end of trash service volumes. For example, if a business is very small and generates only one Toter of trash weekly before having composting collection, they cannot – by code – reduce garbage service to less than weekly to allow them to reduce costs. For the next rate structure that would go in effect in July 2006, we will be looking at options that would allow them to get a break on their service costs or frequency. Sometimes the hauler has not charged more, in order to keep them on the program, even if the business can’t reduce the frequency of just the one Toter it is using.
At the high volume end, large businesses using a compactor can get the cheapest collection service per weight or volume. If the business separates out the compostables and puts them in small containers, especially Toters, they pay more per yard or pound than they would have with the compactor, because it costs more to collect multiple small containers. However, a restaurant or large compostable generator may be able to use their compactor for compostables and another compactor or smaller bin for the remaining trash. If the restaurant separates out its recyclables, it’s then just left with primarily plastic. A compactor used for food scraps would have to be tightly sealed to contain potentially highly liquid material.
Q: How frequently is the rate plan reviewed and rates negotiated with the service providers?
A: The Refuse Rate Board approved a rate plan for Norcal Waste Systems, Inc. that sets garbage rates for five years through June 30, 2006. This rate plan included a financial incentive for diversion to achieve target tonnage goals using a one to two-tiered bonus/penalty-based system that rewards Norcal for diverting more materials from the landfill. San Francisco is currently in discussions with Norcal to prepare for its next rate review process for rates that would start on July 1, 2006.
DIVERSION INCENTIVE FOR SERVICE PROVIDER
Q: What is the current two-tier incentive agreement with Norcal?
A: In the last rate setting process, a Diversion Incentive Account (DIA) was created to “incentivize” Norcal to help the City achieve its diversion goals. Since the City had not reached the state’s 50 percent diversion mandate in 2000, we wanted to achieve it preferably by 2003, but absolutely no later than 2005, based within the two possible extensions that the state was authorized to grant. We set specific tonnage goals of how much could go to the landfill for each of the five rate years. Basing the diversion goals on the amount of tonnage Norcal delivered to the landfill made it simple and easy to verify progress using weight reports. We were able to use previous tonnage records of waste landfilled and then project the lower quantities needed to achieve our goals.
The DIA created two tiers of tonnage goals that resulted in providing either rewards or penalties on the amount of projected profit that Norcal keeps. A Tier I level had higher allowed disposal tonnage numbers than Tier II and was based on meeting Norcal’s projected program rollout goals and achieving 50 percent diversion for the City by 2005. Tier I goals didn’t start until the third of the five rate years, after substantial new program and facility rollout was to be achieved. It began on July 1, 2003 and went through rate year 2005. Meeting Tier I goals for a given rate year would result in a reward of receiving an additional one percent of profit (above the profit margin of 8.45 percent of the pre-5 year rate period) for a total profit of 9.45 percent; not meeting Tier I goals would result in losing one percent profit for a total profit of only 7.45 percent.
Tier II tonnage goal numbers were more ambitious and based on achieving 50 percent diversion in less than three years by 2003, a much shorter time frame with a more rapid rollout of programs and facilities than in Tier I. After rate year 2003, Tier II was kept flat since the 50 percent diversion goal was to have been achieved. Tier II had goals for all five rate years. If those goals were met in any given year, then a reward of an additional 1.55 percent profit (above the profit margin of 8.45% of the pre-5 year rate period) for a total profit of 10 percent would be given. The actual garbage rates were based on the Tier II higher profit margins with the difference between the 8.45 percent and the 10 percent profit going into a special account that Norcal could access only when they certified achieving their incentive goals.
Q: Did the two-tiered goal approach achieve the desired results?
A: This tiered diversion incentive made a real difference for Norcal in getting them to prioritize and really push hard for more rapid program and facility expansion to achieve the goals. Norcal did achieve their Tier II goals the first two years of the 5 year rate period, which was due to both a more rapid rollout of programs than originally projected and to an economic downturn those years that decreased generation. Achieving Tier II goals resulted in more than $2 million a year of additional profit for Norcal. Subsequently, the City was able to document 63 percent diversion for calendar year (CY) 2002 and meet the state’s mandate. Norcal was able to achieve Tier I but not Tier II in the third rate year, in part because of the large drop in the tonnage goal that year which turned out to be unrealistic due to the increase in waste generation that occurred.
With this type of incentive system based on disposal tonnage goals, a downturn in the economy makes it easier to achieve the goals, and that can help compensate for lower revenues, especially in the commercial sector. When the economy is booming, the resulting increase in waste generation makes it harder to meet the diversion goals but then the revenues are up for the hauler.
In the past six months, we’ve been meeting with Norcal to identify and discuss issues regarding new rates and options for their structure for the period starting July 1, 2006, These include how to maximize incentives for both Norcal and their customers to increase diversion, such as various tiered rates. A new diversion incentive structure will likely set goal levels to help the City achieve 75 percent diversion by 2010. A key ingredient to helping us achieve our higher diversion goals is to provide incentives for both haulers and their customers.
Q: If San Francisco didn’t provide incentives, would Norcal and its haulers still be involved in the food composting program?
A: Norcal and its haulers would still do the program because the City approved rates to fund the program. Norcal’s composting facility receives tipping fee and product revenues from it, and it provides great public relations and marketing opportunities for them. Norcal has created a food composting niche and they have been bidding and winning contracts to collect residential food scraps in other communities. Norcal is demonstrating its ability and expertise to do a successful food scraps program, from collection to producing a quality compost product and marketing it well, with a closed loop system of fresh food products returning to the city. They have a track record no one else has.
BIODEGRADABLE PLASTIC DEVELOPMENTS
Q: Many source separated organics programs contend with large amounts of plastic contamination, especially film plastic and disposable cutlery. What has been San Francisco’s experience with plastic contamination?
A: Film and other plastic from both commercial and residential participants are still the biggest contaminant and the biggest removal cost in the composting process. The contamination also can have a negative impact on product value. Some commercial participants have been allowed in the past to use plastic bags to line containers because they determined that alternatives, including washing the bins or buying compostable plastic liners, were too expensive or not readily available. In an effort to reduce plastic bag and other food serviceware contamination, including glass, Norcal recently sent a letter reminding its composting customers to be sure to avoid putting any noncompostable products, including plastic bags, in the collection containers.
Q: Have any of the city’s programs involved widespread use of compostable plastic products?
A: We see a valuable role for appropriate compostable plastic products, especially water proof liners or bags, in facilitating increased participation and addressing concerns about dirty containers and the need to clean them often. The City and Norcal allow and promote only those biodegradable plastic products for use in the composting collection program that are certified by the Biodegradable Plastics Institute (BPI). This certification is based on the only scientific standard for compostability and degradability in a typical composting operation that the industry currently has. Norcal also has tested a variety of products at its composting facility and is confident that those that meet this standard will break down adequately in the two to three month composting process.
Key issues for these products have been their availability and price. Both of these factors have been improving significantly in the last few years, with many more companies getting involved in their production and distribution and prices coming down. But there are still more expensive than regular plastic.
To help increase participation in the residential composting program, we launched an outreach campaign that is distributing sample packets of 3-gallon compostable bags to line the kitchen pails households receive from the program. We also arranged for two different brands of compostable bags to be sold in many of the city’s supermarkets and large drug stores. The bags have been well received and are selling well in the stores.
Q: Have you seen any developments that could lead to lower prices for compostable plastic products?
A: Our office recently awarded a bid to purchase over $50,000 worth of compostable products, including liners, cups, cutlery, clamshells and straws from Nat-Ur Inc., a biodegradable resin converter. We wanted to be able to provide samples to commercial and city department participants to help them evaluate and commit to switch from disposable to compostable bags and food serviceware. For example, we are currently offering new program participants – if the need arises – up to a month’s supply of compostable bags to try, with the intent of subsequently purchasing their own bags if they decide they need them.
We have been working with Cargill-Dow, which produces Natureworks PLA – a corn-based resin that can be made into compostable clear cups and other products – and Fabri-kal, a cup manufacturer, to help them identify potential interest in large-scale compostable cup use, such as at SBC Giants stadium (where we have set up food composting) and other ballparks and large venues. Their specific goal is to produce and market enough cups, about 30 million a year, so they can be cost-competitive with PET cups. Cargill-Dow says they are now producing resin that is cost-competitive, and that what is needed is the economy of scale in production runs to be able to keep prices down at the distribution level.
Our Department also works with special event coordinators to have their vendors utilize compostable food serviceware and participate in the composting program for their events. This has often been successful with diversion upwards of 90 percent at a number of events, some with tens of thousands of participants.
Q: Are there any other steps that San Francisco is taking to address the problem of plastic contamination and associated litter problems?
A: The Department has been pursuing a policy measure to reduce the excessive amount of retail bags used, which are primarily plastic, given their litter and environmental impacts as well as the impacts on recycling and composting and overall clean up costs, which end up costing the city millions of dollars a year. Our Commission on the Environment just passed a resolution to encourage the Board of Supervisors to adopt a user fee of $0.17 for supermarket check-out bags of all types. Half the money would be used by the city to primarily recoup clean up costs and the other half by food markets to increase recycling, composting and use of compostable bags.
We also are evaluating policy options to reduce the excessive use of nonrecoverable disposable food service products by requiring only durable, reusable, compostable or recyclable food serviceware products be used. Our Supervisors passed a resolution calling for City Departments to only use reusable, recyclable or compostable ware at their food service operations and to participate in the composting program. While this resolution was not mandatory for departments, it is a step in the right direction and an opportunity to increase awareness and use of better alternatives that support the growth of our composting programs. – M.F.
SOURCE SEPARATED ORGANICS DIVERSION – LESSONS LEARNED
DURING his interview with BioCycle, Jack Macy was asked what advice he would give other municipalities that want to start a food scraps collection program. He cited the following “lessons learned:”
Provide financial incentives to haulers. We did that with the Diversion Incentive Account (see main article) and it made a difference for the hauler and they have met goals each year so far. We believe that we can further improve upon it in our next rate setting process.
Start small to demonstrate, but don’t call it a pilot program. Call it a demonstration or a new program and evaluate, tweak, and expand it. Keep going with it and don’t stop and start. A lot of communities do a pilot for three to six months and then stop, write a report and try to get support for it, which can take years.
Go for the low-hanging fruit. Get the easiest participants first, like supermarkets, produce markets and large well organized food service operations. They’re already sorting and processing food so it is easier for them than, for example, wholesalers who do less handling of food because they sell it in boxes and pallets. Since you probably don’t want to collect the plastic generated, you’re asking wholesalers to add a whole sorting process. Restaurants can have good control and easily capture food scraps. Start at the back of the restaurant with food prep and move to the front with postconsumer, especially where tables are bussed.
Give customers lots of options for containers and service, including daily service. Have a variety of options from small to large containers, even compactors for very large generators. Frequent collection can make a big difference. If food and trash are sitting in one large container for several days it could generates odors, attracts rodents and possibly leak. Offering more frequent service for compostables allows the customer to potentially have a cleaner operation. It has often been an incentive for many large generators to have the food scraps collected more frequently and the nonputrescents collected less frequently. With a two compactor system, the one with compostables could be collected more often.
Provide financial and other incentives to participants. Establish discounted variable rates for both commercial and residential sectors, that allow easy and substantial costs savings. This is especially important for businesses that focus on the cost of service. Work to provide incentives for all types of generators, large and small, if they participate well. Also, providing good recognition opportunities, such as the award programs or green business certifications that we conduct, are a real motivator in our experience.
Get management support and buy in at all levels. Offer clear incentives to show how management can benefit and get any assistance they need. This is important since there is so much staff turnover and you want the managers to have it be part of their employees’ job to participate and to train new employees as the come on in the future.
Make the program as simple, easy and convenient as possible. Color-coding the containers means you don’t have to deal with language issues. Use pictorial graphics of food and not a lot of text for labels and posters. Get it set up right at the workstations. Use ergonomic design. The compost container needs to be right there where the worker needs it, so they don’t have to walk something across the room to a container. Have compostable and trash containers next to each other. The city provides free 23-gallon Slimline containers for internal sorting – green ones for food scraps, and blue ones for bottles and cans or mixed recyclables. Two slims attached together, such as on a dolly, take the space of one 32-gallon Toter, while three slims – for compostables, recyclables and trash – take the space of a 64-gallon container. Some participants have the space for sorting directly into wheeled Toters that are tipped by the driver into the truck, minimizing handling by the customer.
Provide free on-site assistance and staff training when setting up a customer for the food scrap program. Address generators’ concerns. If they think they don’t have enough space, help them make it work. Make sure it is done efficiently before there is a change in their rates. The city has contractors (Applied Compost Consulting) who provide free on-site, multilingual training and program set-up and trouble shooting assistance, as well as educational posters and signage, in addition to internal containers. We design them jointly with the haulers and pay for most of them. The city draws money from the rates and puts it back into the program. It is also important to monitor participation and contamination and provide timely feedback and assistance.