increase their refuse rates. so that puts some checks and balances into what increases you might see. a couple of other points. total fees now total $23 per ton, $17.81 at austin road, and finally, if allen meeting county were to wait, all of the fees instituted since 19 -- if alameda county were to wait -- so two additional slides. these are per ton. they do not include the cost of transportation. you can see the cost comparison between the two.

$66.79 per ton for waste management. including the alameda county fees, $75.54 for waste management. again, this does not include transportation costs. this slide, which i will not get into specifically, illustrates what the state and local government fees are in alameda county versus austin road, there are a number of fees that you can look at. the total cost to race -- ratepayers over a 10-year contracts band would be about $110 million for the one, over $240 million for waste

management. this is over the 10-year period. and this is cost per city department, so all of the money that is spent by our city department on the trash, these are the costs that we would be looking at, with either of those two companies. and $3.70 million for waste management. these are for all of our departments. so in terms of the cost, it is a pretty straightforward analysis. the one bid is significantly less expensive. now, in terms of the environmental analysis, our panel did look at the landfills and compared the two. this was opened in 1980, austin

in 1987. both are permitted and meet the subtitle standards, which are the strictest, newest standards for landfills in our country. it is fully lines, whereas altamont is not. -- it is fully lined. both landfills to on site methane gas recovery, and both would only be accepting our garbage. they would not be accepting sewage sludge and no organics for composting, so there was something about exactly what this contract covers catholic covers, with no composted. -- what this contract covers,

with no material for composting. and there is the air force base. as you can see in terms of the environmental analysis for the landfill, they are relatively comparable. now, regarding the transportation analysis, which, again, was not bid out, both bidders koran or asked if the landfill site -- both bidders were asked if the landfill site met some criteria. now, some environmental considerations regarding transportation. shipping by rail is four times more fuel efficient than trucking, according to the association of american railways. this is significant because for part of the analysis, recology is planning to use trucking as well as rail to bring it to

austen wrote. -- austin. the environmental science associates also put up a report that documents the results. these are the results. the two landfills, recology, yuba, austin, and the others, it shows the difference in carbon dioxide that would be emitted per ton of waste. 1.1 5 million -- 1.15 tons. a quite some of the result that

would essentially resulted in millions of tons of carbon dioxide not emitted over the life of the contract. just to give you some context, all of our city buildings to emit 500,000 tons of carbon dioxide into the air every year. this is a pretty significant savings if we want truck and rail. these are the rfp panels. most of very similar. in this, recology did get a total higher score. a couple of things i wanted to address. i know you will hear more about this from the budget analyst's report. i know you are well aware of the

city ordinance that allows only permanent haulers to transport waste on the streets. currently, only recology can bring this into san francisco on that road. they would be transferring the waste from the san francisco transfer station. for this reason, the facilitation agreement is presented with the agreement today. it does provide back up. now, a question did come up about what they are considering about separating out the facilitation agreement and putting that out. that was considered and ultimately rejected for the following reasons. if transportation were put out to bid, there would be a negative fiscal and environmental impact in a number of ways, which could possibly

influence a second transfer station that would be outside of the city limits, which could cost up to -- actually more than $40 million. the estimate we received of what a new transfer station would cost, $40 million to $60 million, in fact. it would also include a 1100 million tons per day to be transferred -- many tons to be transferred, with inefficiencies in the system. it would possibly eliminate up to 42 san francisco truck driving jobs, and it would also reduce transportation costs, which are now subject to a rate process, and we currently have access to the records and the ability to modify it any time. and then, finally, putting out the facilitation to bid would violate the overarching considerations, which means there would be negative impact. this was considered and

ultimately rejected. finally, you probably will hear about reopening this process. redoing this process would take a minimum of two years, so if we eliminated this process, and the fastest that we could possibly do this process would be two years, but assuming that we want to include the public process, it would be a minimum of three years, so the major problem is that this would leave the city dangerously close to not having any landfill agreement in place, and the contract would be used up and could result in significantly increase costs due to the need for last-minute negotiations. we are very concerned about the position this would put the city in by being right up against the deadline. what sort of negotiating power

with the city need to really get the best rates for san francisco and our rate payers? and finally and just as significantly, if there is an unforeseen event, it could be a natural disaster or some other event, that generates a large amount of landfill waste, the city would not have a contingency plan in place. we assume we have about five years left on our current kondracke. we do as a city, of course, need to plan as a city, regarding our disposal in our waste. we did get to the contract phase, and through the process, recology was chosen as the preferred contractor. there is the director of the department of public works, the deputy director for our department, and also tom owen, a

deputy city attorney. and just in summary, the proposed recology contract that is before you for consideration is for the life of the contract. waste would be transported to the east bay and then to rail to the ostrom landfill. however, if the city meets our set -- our goals, the contract value could be less than $50 million because the tonnage would be, of course, reduce. so, finally, the department of the environment is recommending that approval of the draft landfill contract as well as the facilitation agreement with recology is approved. we do believe it is the best

option for the city and county of san francisco, and i am very proud of the extensive work that has been conducted by the panel, the contra negotiators, as well as the department over the next few years. i am confident that you will see this is a competitive contract, and it really is a great deal for san francisco. i am happy to answer any questions, and we have a number of staff and are happy to answer any questions, as well. chair chu: i know there are a number of people who would like to talk, but if we can have patience, and we will go to the budget analyst. >> madam chair, members of the committee, supervisor campos, as you know, the proposed resolution before you would authorize the department of environment to enter into a new landfill disposal agreement with recology beginning in 2015 and

extending up to 10 years, designating recology's ostrom road landfill as the exclusive side, allowing the waste in san francisco to be deposited in the landfill. the proposed resolution would also have an amendment to the existing facilitation agreement between the department of environment and recology, which authorizes them to continue to transport it to a new landfill site in yuba county and transport such refuse primarily by rail instead of the current exclusive trucking message. the city currently has an exclusive landfill agreement with waste management out to the landfill in leavenworth, which allows for the deposits of up to 50 million tons of refuse in that land fill site. the department of environment anticipates that the capacity will be exhausted by 2015, at which time the existing landfill

disposal agreement with waste management will expire. the department of environment is now requesting after having conducted a competitive bid process with a new landfill disposal agreement between many parties, that'd be awarded to recology for up to 5 million tons in san francisco to the ostrom road site in new county beginning in 2015 for up to 10 years. -- in yuba county. the department of environment previously entered into an existing facilitation agreement without a competitive bidding process, which required recology to consolidate refuse at its transfer station in san francisco and then transfer such refuse at the landfill site in livermore. the term of the facilitation

agreement will expire simultaneously with the existing landfill disposal agreement with waste management, and that is anticipated to expire in 2015. in order to provide continued control over the transfer and transport in handling of the city's refuse by recology the proposed resolution would also propose an amendment to the existing agreement with recology to begin upon the expiration of the existing agreement, which is expected to be in 2015. this amended facilitation agreement would require recology to continue to collect this at its transfer station in san francisco and transfer it at its transfer station to ostrom. supervisors, i want to point out that unlike the landfill

disposal agreement, neither the existing facilitation recruitment -- agreement or the other were competitively bid, because under the city's refuse disposal ordnance of 1932, recology is the city's only permitted waste hauler, and as such, they are the only firm qualified to take it through the streets in the city and county of san francisco, and of quote, and transfer that waste from their transfer station in san francisco -- end of quote. the transfer station is located near candlestick park. refuse collection in the city is governed by the city's refuse collection and disposal ordinance of 1932. it was previously approved by the voters of san francisco, which requires that only permitted refuse haulers collect the refuse and transfer

it through the streets in the city of san francisco. the ordinance created 97 permanent permits, which is due to a number of acquisitions since the ordinance was approved, they are currently all of and by -- they are all owned by recology, which has resulted in then becoming the exclusive collector without them ever having to go through their normal collective bidding process -- competitive bidding process. there is the amended agreement and the landfill disposal agreements, and there are two fees which would be paid to recology. into the ostrom road . in yuba county, and then going by rail rather than truck. -- into the ostrom road area in

yuba county. the proposed two agreements are proposed to increase rates 3%. the monthly rates paid by a single family residence with a 32-gallon waste container would increase by 82 cents, from $27.55, a 3% increase. however, supervisors, unlike waterways, charged by the public utilities, which are subject to the board of supervisors, neither residential and more commercial refuse collections are subject to the board of supervisors' approval. under this 1932 ordinance, residential refuse collection rates are subject to approval by the director of public works.

if the rates are appealed, then there is a subject to the rate board, which is composed of the city administrator, the controller, and the director of the public utilities commission. in fact, unlike residential rates, collection rates paid by san francisco businesses are not subject to approval by either the director of public works or the rate board. so the board of supervisors, since 1932, has never been provided with any oversight authority whatsoever under the existing provisions of that 1930 to refuse and collection disposal ordinance. -- that 1932 refuse and collection disposal ordinance. in our report, it is over a $200 million agreement per year. as you know, the supervisors approved oversight in numerous contracts that come before the

board. not even approaching $100 million. and this is a $206 million annual agreement. as i stated, the 1932 ordinance has resulted in recology becoming the exclusive refuse collection firm was not ever having gone through the normal competitive process. -- without ever having gone through the normal competitive process. huskey the budget and legislative analysts believe that such a firm should be selected through the city's normal competitive bidding process. therefore, the policy alternative for the board of supervisors include submitting the proposition to the voters to repeal the city's existing

refuse collection and disposal ordnance of 1932, such that future refuse collection in transfer services would be required to be awarded by the city under the city's normal competitive process, and would require the refuse collection of both residential and commercial services to be subject to board of supervisors' approval, it just as water waste is subject to board of supervisors' approval. the agreement, as i mentioned, it is not subject to the competitive bidding process because the department of environment under the refuse ordinance, they alone can transfer or refuse in the city of san francisco and to transfer it from their transfer station, which is located in san francisco near candlestick park, and that means traveling through the streets of the city and

county of san francisco. therefore, it may be possible for a second firm other than recology to transfer it after it has been collected by them if it is a outside the city limits or if it is located near korea or rail facilities -- near korea and -- marine or rail facilities. should the board of supervisors not submit this, our second policy alternative for consideration by the board of supervisors includes requesting that the department of environment analyze the potential costs and benefits of using recology but using a second, separate firm to provide refuse collection transportation collection which

avoids transporting refuse through the senate -- streets and county of san francisco. they had never been subjected to the city's normal competitive bid process. submitting a proposition to the voters to repeal this initial ordinance of 1932, such the future services would be required to be awarded under the city's normal competitive bidding process and require that refuse collection for both residential and commercial services piece object to the board of supervisors? ' -- boris supervisors' -- board

of supervisors' approval, and i am here to answer any questions. chair chu: thank you. this is the one that shows the cost comparisons. we have met, probably, many of us with different sides of this issue. as well as the proposed and community organizations on this issue. one of the things that is brought up as the issue about the fees, the fact that the $14.66 are currently not being paid. explain to me why you are including that in this comparison? >> these fees are now not being paid because when san francisco entered into the contract with

waste management for the landfill, these fees were instituted after that contract and were grandfathered in. if we went with the waste management option, san francisco would be subject to those fees, even though we are not right now. chair chu: ok, so the reason we are not subject to those fees is that we entered into the contract prior? >> yes. chair chu: and we do not have any expectation that those fees would be waived? what about other counties? >> we do not have any expectations that those fees would be waived, but even if some of them were, recology would still be 34% less expensive. record -- according to others, i will defer. >> to my knowledge, it is a similar situation to compare it to, so our anticipation is that

we would be subject to these fees, and, again, we did the cost comparison both ways, so if every single one of these fees were waived, it would still be $100 million less expensive. >> -- chair chu: this is the same thing as a tipping fee, is that correct? >> that is correct. chair chu: i see these comparisons. what is the current tipping fee? >> $20 per ton. i believe it is $20 per ton, but we will double check that. chair chu: ok, thank you. supervisor mirkarimi?

supervisor kim: to be asking a would be charging that if we did we knew this? >> we did not ask, -- he was here during that time. >> the question was about it being deferred? we did not ask. supervisor kim: it was because waste management was not the sewage a proposal, and even if these fees were not paid, you would still see a differential. >> yes, in fact, if we wait every single fee, it would not save alan needed county one single pennya -- alameda county one single penny.

chair chu: supervisor mirkarimi? supervisor mirkarimi: the report was thorough, and as relates to the cost comparisons and the merit of this contract, it was a larger recommendation that should, i think, be he didhe -- heeded very seriously. i also want to say thank you to all of the stakeholders, particularly recology and the department of the environment, representing the interests of this contract. historically speaking, i have been a big fan of recology. the incarnations in certain areas, i have found them to be very collaborative on many sort of cutting-edge, environmental proposals that have been born out of city hall and our

partnerships together with them. they have done a good job. i think there is something to be proud about the fact that it is employee-owned, and they are the largest of the industry to be of such, and i think those are important. but what is before us here today, in how this has been delivered in terms of the proposal here today, it warns greater scrutiny, and i think that is what we will attempt to get into. in respect, as to is this the best deal for san francisco, consumers and ratepayers, and is this the most forward thinking strategy as it would unite with our environmental principles, goals, and objectives, and while i very much appreciate having the presentation that has been laid out publicly as well as