then they drive again through what neighborhood? bayview in visitation valley, right across the street from people's homes, homes where they have the pleasure of smelling that garbage all the time because it is right there. and then, trucks again out of there. i am here seeking support of putting what transfer work and support, farther away from people's homes, especially if you can bring in there and then barge or rail or everything out from that point, so the environmental impact is less substantially. is that feasible? we do not know. this report is supposed to tell us. if you accept the report as it is right now, you will never know. the report does not cover it very well right now, and if you do not have competitive bidding, do not have a contract to

evaluate it because it is not regularly returned to you, we will never know. what was discussed today about pier 80 is a great idea, and we would never have heard that had we not gotten to this point in the presentation. we need to get rid of the -- not quite accidental, but the notion that our services are done by the hard work and good grace of recology. we need context and we need competitive bidding. commissioner campos: next speaker please. thank you. >> good morning, commissioners. just wanted to echo the sentiments of mr. kelly and others. this really is not about the ecology -- recology. it is a great company. it is worker-owned. they have this whole 0 waste program. we have to look at what is best for the rate payers. i heard the gentleman from r3. some of the questions he

answered. the other things he did not know the answers to. i urge you to take the time to get the kind of answers that you seek, to find out the truth of these things. codifying these agreements. who is paying what. there are many folks in this room that could tell you the answers that the gentleman from r3 does not even know. it was a good report. not complete. i urge you to take the time. get the answers you seek. i did not know about pier 80, of brisbane. i would like to see the citizens of san francisco benefit. i'm not hearing that. recology does not have any barging facilities in place. they do not even have any landfills. it is not really cost-effective for them if they do not have a place to barge. as i said, there is no doubt they are a good company that does good work, worker-owned and all that. but we deserve to get the best possible deal for the ratepayers moving forward.

thank you. commissioner campos: thank you. next speaker please. >> good morning, commissioners. i do not mean to repeat what was said about the positions there. i also as a resident of excelsior district said that i am also in the same position, opposing a recommendation. i am concerned about if the question is really about the open competitive bid, looking at how much the fee is because so many questions are related to that. that is really beside the point. most of the union members and working people and all the residents are really concerned

about the quality of the service they are providing. and if money and nichols and dimes is concerned, ahead of the party service, that we are going wrong way. we need to take a look at not about this, whether waste management they can put a lower bid. it is really other elements. we want the city to be right. zero ways and other quality service. so i hope you consider that. thank you, commissioners. commissioner campos: thank you very much. next speaker. >> good morning, commissioners. in general manager for west -- a tug and barge marine company at year 50. we have been a tenant of the port since 1976. our crew members are union

members, and we provide a living wage for approximately 65 employees at that location. we provide barging services for a wide variety of items and commodities throughout the day from redwood city all the way up to stockton and sacramento. we feel that if any company would like to work with us in terms of providing this type of service, we can certainly work with them to make this happen. for example, we currently move out two barge loads of molasses each month, and that takes about 200 trucks off the road each load. it would be, like, 400 less trucks. just wanted to bring that to your attention and say that it is certainly a possibility to be looked at. commissioner campos: quick

question -- you said you had been at the port since 1976? >> that is correct. commissioner campos: have they talked to you about the possibility of margin? >> the city has not. we have met with the court and brought the subject up. commissioner campos: thank you. next speaker. >> i am a resident of san francisco. one of the three objections of -- objectives of lafco is to preserve agricultural land resources. what concerns do you have about taking our black box non- recyclable garbage to a local landfill in yuba county, which is surrounded by agricultural land, and which has a large

offer for 30 feet from the surface of the land? our concern -- what kind of garbage is recology proposing to send to yuba county? organic or inorganic? at a november meeting, the director and inorganic, but we now know that what goes in the black box includes dog, cat, and the the waste -- baby waste. there are an estimated 120,000 dogs and 100,000 cats in san francisco. public library says there are 25,000 babies two and under. they use an average five or more diapers per day, which means 125 soil baby diapers per day going into the black box. that is a lot of organic matter produced by dogs, cats, and babies. so what? organic matter produces methane, a greenhouse gas contributing to global warming.

the concentration of landfill gas must not exceed 5%. the latest site inspection report at the landfill showed 14% methane by volume. david osborne said recently to me, they are struggling with this. this, meaning the organic problems in our black box. one reason the sierra club urges the -- [bell rings] commissioner campos: thank you. next speaker. >> i am a san francisco resident. thank you, commissioners and staff, for undertaking this study comparing our bidding process to how other cities and counties in the surrounding bay area collect, hall, and dispose of their black box ways. according to resourced, san francisco will be the only city and county disposing of black box waste over 100 miles away. to be precise, 135 miles away.

according to the reports, we have closer landfill sites in other locales. with new developments in the middle east, rising fuel costs, this has become an important factor to consider. according to this report, recology can raise rates due to factors such as fuel costs, whether by truck or rail. this has become an important factor to look at. members of the commission, i urge you to recommend a new rfp process for disposing of our black box ways. the current contract under consideration is not a good choice for san francisco ratepayers. the possibility for agricultural or water contamination does not signify a good environmental responsibility on our part as a green city. i also urge you to recommend a ballot measure to reform the 1932 ordinance. competitive bidding and a

formal service agreement on all aspects of collection, hauling, and disposal is the best way to keep rates even here lastly, landfills should be a thing of the past. europe is using mass incineration that is both cleaner than a barbecue grill and transfers heat to warm their homes. once again, san francisco could lead the way and institute the green technology. i am submitting an article about this from the "new york times." thank you. commissionersupervisor campos: e any other members of the public like to speak, please line up. >> we represent longshoremen in san francisco and the bay area. we have marine clerks from local 34 and 75.

we also have a union that is purge workers and backhands. we have heard a lot of stuff today but we have not heard it all. there has been no study detailed and complete on barging. you do not know what the cost would be for a 300-container barge. it is a barge that can go to any land fill up north or out of state. while it is going one way with 300 full ones, there is another one coming another way with 300 in fees. you cannot get that kind of efficiency by truck or rail. i look at it as a longshoreman. we're talking about a down from the truck onto a move on to the barge. when it gets to where is going, it moves from the port in is

dumped into the landfill. that is it. right now, we're talking about a dump and a load, i am not sure how many moves just to get into oakland. the other thing you are not looking at is revenue to the port. the port is the revenue for each container brought through the port. instead of sending stuff out of san francisco, all of a sudden you can be bringing them into san francisco, through our ports, and into the landfill. there's a lot to look out for barges. please take a long, serious look at it. that has not been done. supervisor campos: thank you. next speaker. >> good afternoon. my name is john smith. i am outside counsel for waste management. i have probably negotiated or developed 50 or more franchise

agreements. i urge the commission to continue its steady -- study. the fee is paid under the contracts are multiple and different. what may be 10.9% is duplicated elsewhere in other fees that other jurisdictions pay in addition to the franchise fee. livermore has an impact fee, plus an in ministry fee that is ongoing. some of these are collected at the transfer stations. it is also to the benefit of the contract entities. others are collected at the landfill or are paid back or to the benefit of the contract in agency. i urge additional study be done if you want to do it apples to

apples comparison. the one difference in all jurisdictions highlighted in san francisco is that each is done in with a contract with specific obligations. each has the final approval through the city or county. it is always the elected officials. in this case, it is only the city and county of san francisco where the officials do not have the same. take the next up and look to the additional information out there. waste management is willing to help bring the information together. supervisor campos: next speaker, please. >> we have three companies based at the port of san francisco. one of them is waste solutions group. israelt rails 100 tons of wastea

year. the other is san francisco bay railroad. that is the real road for the port of san francisco. it is a federally certified railroad. the last one has 60 goats grazing at the port. we read them out to anyone that would like them. -- rent them out to anyone that would like them. the study is a good start. but there needs to be vigorous pursuit of detail. i concur with the three areas that need to be drilled down on. one is barging and rail directly from the port. the other is the port of san francisco having a transfer complex and possibly an industrial park based at the port. the third is the issue of franchise fees and what that can

mean to vital services in san francisco. there is a lot of work to be done. i draw your attention to something that may not have been mentioned but i think is emblematic of the whole structure itself. that is on page 7. it is interviews with doe staff. the last line in that paragraph is most emblematic of what is upside-down about our system. staff indicated having a long- term relationship with recology is an appropriate alternative to a competitive procurement process. i am not sure how you could reconcile that with a competitive procurement process. supervisor campos: thank you. is there any other member of the public that would like to speak. miss nutter, you wanted to add

something? >> following up on studies that need to be done, i want to make sure the commissioners know that the department of the environment work with a company called hdr to put together a memo on cost estimates. commissioner campos, a scent that to you last night. we just got it friday. -- i sent that to you last night. we just credit party. that work has been done. we have commissioned a study about a month ago with the port of san francisco looking at the long-term possibility of the port been the site for an integrated transfer facility. both studies are currently in process. i wanted to make sure the commission knew that. supervisor campos: colleagues, i do not know if anyone has anything to follow up. from my perspective, thank you to all of the individuals involved in the process,

beginning with our lafco staff and the stuff from the department of the environment. there in the unenviable position of having to write another report in a few weeks. given the time line, i think you did an amazing job in pulling this together. i want to thank recology for being open to sharing with us all the information available to them. i want to thank them for their open-door policy in terms of answering our questions. i believe the study points to some positive things and some things where there are questions. one positive is that we have a program that is working very well.

the focus of this process has never been about questioning the substance of the work that recology does. the study does point of that san francisco is very unique. 55% of the jurisdictions looked out actually do a competitive process. i am a big proponent of competitive bids. i believe competition is good for the consumer and the rate payer. to the extent the company has had a sole source contract where the company is doing the right job for the consumer, a competitive bid process is the best deal. that process will guarantee that. it will demonstrate that. we also see the study of the

jurisdictions that do not have a competitive bid. 45% of them do have something we do not have. that is a franchise agreement that codifies the terms and conditions under which service is provided. there seems to be something like a contract. they consider some of the documentation in the rate process has a contract. as a lawyer, you look at that. you know it is not a contractual, legally binding document that outlines the things we heard about today. we have the document from the department of the environment. that is the first time i have seen anything that details what recology pays to the city, that shows the collective value is about 10.6% of revenues. that is good to have, but we need to make share -- make sure

our consultant has a way of looking at those numbers. we need to look at where we are relative to other jurisdictions. if we're talking about this being the equivalent of a franchise fee, help are these treated in other jurisdictions? someone in public comment talked about how maybe the franchise fee in some jurisdictions is in addition to other fees being paid to the city. i do not know if that is the case. it is important for us to know that. even if this is the right approach and structure, what is the right amount that should be paid to san francisco? 10.6% of revenue is about $29 million. we have heard from recology that the franchise fees they pay range from low single digits of with up to 15%. what is the right percentage for san francisco? if it is 15% rather than 10%,

you are talking about $14 million more that could going to the general fund. what about the type and quality of services being provided? those questions need to be resolved. instead of acting on this report, i ask that we asked our consultant to come back to lafco in three weeks to give us more information. from my perspective, the main focus should be on the franchise agreement, what is paid to other jurisdictions, and how that compares to what is being received by the city and county of san francisco. supervisor avalos also mentioned the issue of the transfer station. i do not know if there's anything else we want to add to that. it is important for us to have as much information as possible. i also want to say something about the document given to me on friday.

it is a memo that came from the interim city administrator in the city of oakland to the members of the city council there. this memorandum says the city of oakland is opting to extend by 2.5 years the terms of their agreement with waste management of our meeting county -- alameda county. there are different ways to see this memo. in some respects, i can see how it points to the need to extend or continue the relationship with recology. i think it cuts a different way. what is interesting about the memo for me are the two reasons given by the oakland city administrator as to why this agreement should be extended. he said there are two compelling

reasons. one is that the extension of the agreement ensures the city will continue to receive the revenues provided for in the agreement. in fiscal year 2010-2011, the city received $21 million. $4.8 million of that goes into the general fund. that is not the case in san francisco. we do not have a franchise agreement like oakland does. we do not have the same structure where there is a specific amount required by agreement nor do you have a specific amount that goes to the general fund. if we were in that situation, i could see why an extension of the ongoing relationship with makes sense. the fact that we are not in the situation tells me that we have some flexibility and leverage.

the other reason is the extension of the agreement will insure the city of oakland and businesses enjoy the stability of the existing rate structure. i can see have a point would be applicable here. i concede that benefit. the i can see that benefit. this is complicated. the more information we have, the better it is. ultimately, we want to have the best service and deal possible for our ratepayers. we want to do that in a way that is consistent with the values of our city. we have heard from the employees of recology. we have heard about the best practices the company follows. i am proud to see that happen in san francisco. i do not think doing what is best for the rate payers and employees is necessarily mutually exclusive. i think there is a way we can do both. with that, i simply ask that we

cannot in about three weeks -- that we come back in about three weeks and you are back from the consultant. >> i was just going to affirm that the look of franchise agreements and fees compared to rates and services provided -- we are comparing apples to apples that way. i did hear the consultants say three weeks to prepare the report, three to four. that means we would meet sometime after that, in terms of the timing issue. i would like the consultant to speak to the timeline to make sure. through the chair, i can work with you on the revised schedule. >> i think we can come back or have the report ready, let me try for four weeks. i do have some concern on looking at equity and assets.

that is not something we have even started looking at. the franchising fees would be a continuation. if that is something you want us to do, i would like to have more time on the part of it. supervisor campos: commissioner avalos? >> i think four weeks sounds good to me on that. i appreciate your summary of the hearing, german composts -- chairman campos. we do need to look at whether we move the land fill agreement out of budget next week or not or this week or not. i think this information would be important to have. i value your work in the study.

it makes sense that we look at how we can maximize our report resources -- port resources for our waste system. the port is in desperate need of revitalization. if there is a way that we can have a two-fer in having a waste management plan that includes a port development plan, it would be a win-win and make a lot of sense. i am not sure we can do that, but i think this report will give us that information to helpless fly less finely -- to help us fly less blindly in the night. >> i thought you would are decommissioned one of the reports. supervisor campos: a think the department of the environment had a steady. that was the first i heard of it today. i do have a copy of it.

my sense of where we are, i think there are three items. one is the issue of the franchise agreement, the fees, and how we compare to other jurisdictions. second is the issue of the transfer station and issues associated with that th. third, on the issue of merging, -- barging, lookit that issue of using the report provided to us by the department of the environment as a way of augmenting what is reported to lafco. great. i have a final thing that is important. this is directed to our