Following the Ford administration's privatization of residential garbage pick-up east of Yonge in 2011, the City of Toronto's waste management has remained in a somewhat awkward state of semi-privatization. While residential trash west of Yonge is handled by private companies, the east end remains the purview of City service. However, with Mayor Tory now moving forward with a 2014 campaign pledge to outsource the City's remaining garbage collection, the whole of Toronto could be moving towards private collection.
But how does privatization work? And what are its impacts? In Toronto, the answers to these questions are at once relatively simple and profoundly complex. That's because there are actually two types of privatization. While the City's controversial outsourcing of pick-up and disposal follows a relatively straightforward process, a parallel form of privatized service follows different rules.
Waste disposal companies can sign either City-negotiated contracts and privately negotiated contracts, which have very different auspices. In terms of service, accountability, and oversight, whether or not private companies operate waste disposal services is not as consequential as the contractual terms that dictate the agreement: the rules on the contract are more important than the company name on the truck.
In order to assess the full impacts of privatized service as proposed by Mayor Tory, it's crucial to understand the the type of contract that would regulate it, and how it differs from Toronto's other form of privatization.
Privatization Under City Contracts
The privatization of service proposed by Mayor Tory follows a pair of earlier initiatives. A 1995 agreement saw pre-amalgamation Etobicoke privatize collection over two decades ago, while Rob Ford's 2011 privatization of garbage service west of Yonge effectively bifurcated the city between public and private collection. In both instances—as in Tory's current pitch—the outsourcing came about as a cost-saving measure. Following privatization, Etobicoke reported average annual savings of $1.8 million, while Ford's initiative initially saw yearly costs reduced by $11.9 million.
With support for Municipal service also hampered by two long and memorable garbage strikes in 2003 and 2009, the push for privatization was relatively well received in subsequent years. In particular, widespread displeasure with the 39-day garbage strike of 2009 eroded public backing for Toronto's Civic Employees Union (CUPE). Nonetheless, some critics perceived privatized service as an inherent reduction in accountability in transparency, and as a symptom of unwillingness to adequately engage with the rights of unionized labour.
In the East End, meanwhile, City Staff have recommended against the privatization of services, arguing that improvements in municipal efficiency has contributed a more cost-effective service compared to private firms. Whether or not privatization makes sense from a long-term cost perspective remains unclear—and there are a number of other arguments both for and against. Either way, though, a private City-contracted service would functionally replicate the auspices of the existing CUPE program.
The private companies contracted to handle residential waste by the City—currently GFL west of Yonge and The Miller Group in Etobicoke—reproduce the services provided by the public sector. Companies working City contracts are required to maintain Toronto regulations requiring separate treatment for garbage, recycling, and organic waste, while using the City's transfer stations and Green Lane landfill.
Located outside London, Ontario, the Green Lane facility was activated—following the City's $220 million purchase in 2007—to replace exports of waste to Michigan. Amidst political pressure from both sides of the border, the 12-year agreement that saw up to 10,000 tons of GTA waste shipped across the border each day was ended in 2010. Along with three other Ontario municipalities, Toronto ceased exports to Michigan in early 2011. The City's waste was subsequently re-routed to the new and technologically advanced landfill, and any private City-contracted collectors are now required to use the facility.
Parallel to the well-publicized debate about privatization, however, the City's condominium boom has quietly precipitated a growing deregulation of Toronto's residential waste. Although the City maintains a contract with GFL to service Toronto's multi-residential dwellings, condo boards and property management companies can elect to opt out of City-Regulated collection services. In its place, other private waste management firms can be hired, with some 30 percent of Toronto's more than 6,000 multi-residential buildings opting for private services.
Privatization Without City Contracts
Outsourced contracts negotiated with the City for Etobicoke and the West End—and the East End, if privatization occurs—require waste management firms to use Municipal facilities and abide by City regulations, but the same is not true for the multi-residential properties that choose to opt out of the City's GFL contract. Privately negotiated contracts necessitate neither the use of municipal transfer stations and the Green Lane Landfill, nor adherence to the City's garbage, recycling, and green bin programs.
While private contracts are by no means inherently worsen service, the problem is that it's almost impossible to know quite how the agreements that cover some 2,000 of Toronto's residential buildings actually pan out. As part of these deals, private contractors are not required to disclose their facilities to the City, nor to follow regulations governing the sorting of waste. While Provincial policy does broadly govern how waste can be handled, it lacks both the specificity and mechanism for oversight provided by City regulations. Instead, oversight effectively becomes the responsibility of individual property managers and superintendents.
With a sharply increasing number of Torontonians now living in condominium and apartment buildings, the risk is that the growing number of privately negotiated contracts may also undo some of the centralization brought about after the City halted exports to Michigan. According to Toronto's Solid Waste Management Services Division, the City is unable to control—or even know—where Toronto's privately contracted waste ends up. There are no regulations preventing the export of private residential waste to Michigan, just as there are no laws requiring private waste management companies to follow the City's three-pronged recycling, organics, and waste program.
For private waste management companies, Michigan's comparatively low tipping rates continue to make the Great Lake State a North American hub of refuse. While political and environmental pressures eventually led the City of Toronto to stop exporting waste, the same incentives that served municipalities remains in place for privately contracted firms.
In recent years, resident complaints about private collection have also periodically surfaced. While the City-contracted companies have not been spared criticism—service in the West End got off to a rocky logistsical start following privatization—more serious problems can accompany privately contracted collectors. Instances of trucks combining garbage and recycling have been occasionally publicized, with residents catching privately contracted trucks chronically failing to separate recycled material.
Although the allegations can be alarming, these situations don't necessarily indicate any wrong-doing on the part of the waste management company. In fact, there can be legitimate reasons to consolidate garbage and recycling bins. For example, if the 'recycling' is deemed to be too contaminated to be processed as such, it's standard practice for City trucks to consolidate it with garbage.
The City regularly monitors trucks, transfer stations, and landfills, but privately contracted waste management firms are only subject to regular scrutiny from the companies that hire them. Frequently offering cheaper rates, private contracts aren't subject to the same degree of scrutiny. Many—if not almost all—of these companies may still be upholding the industry's best and most responsible practices. Unfortunately, without a strong regulatory mechanism it's very difficult to tell.
Ultimately, the problem with private contracts isn't that the companies carrying them out are irresponsible—indeed, nothing prevents them from meticulously sorting, transferring, and disposing of trash, recycled material, and organics—the problem is in a lack of regulation. The companies responsible aren't obligated to follow the City's standards, fostering an incentive structure that encourages less meticulous sorting and cheaper disposal methods. It might also lead back to Michigan.
Although private multi-residential contracts remain comparatively unregulated, the City of Toronto's recently adopted Long Term Waste Management Strategy may eventually bring greater oversight to the process—in part through closer co-operation with property management companies and superintendents—as the regulations continue to take shape.
Meanwhile, the majority of Toronto's industrial and commercial waste is managed under Provincial jurisdiction. Although the City's Yellow Bag program provides Municipally managed waste collection for some of Toronto's smaller businesses, most commercial and industrial trash—which is also privately collected—falls within the jurisdiction of the Ministry of the Environment and Climate Change. On the Provincial side, the recently enacted Waste-Free Ontario Act promises to divert more of Ontario's waste from landfills, mitigating ecological harms.
By and large, Tory's proposed expansion of outsourced waste collection would see the current organizational structure maintained. The same landfill and transfer facilities would continue to be used, with the City merely contracting a private company to take over collection east of Yonge while maintaining existing regulations. That doesn't necessarily mean it's the better option, but it does make it a comparatively small departure—at least in service and regulation—from the status quo.
While supporters of privatization cite the efficiency of a competitive free market where companies bid to offer the City favourable conditions, critics point to the growing long-term costs of privatization. What's more, a complete shutdown of City-led service makes privatization effectively irreversible, leaving no public option in the event that private services become less viable in the future. With these factors in balance, the issue justifiably remains a contentious one. However, any differences between private and public collection pale in comparison to the differences between privately and publicly negotiated contracts.
Regardless of how the debate about privatization plays out, a less publicized—and potentially more impactful—wave of privatization is already taking place as Toronto's residential buildings opt out of the City's contracts. As Toronto continues to urbanize and high-density dwellings become more common, opportunities for privately contracted service continue to grow.