City applies for trash pickup certificate

Posted: Sunday, June 27, 2010

The company contracted to pick up Juneau's trash could get some competition, possibly from the city of Juneau itself.

The city has applied to the Regulatory Commission of Alaska for a certificate of public convenience and necessity for trash pickup. That would mean Arrow Refuse, owned by Alaska Pacific Environmental Services, would no longer have exclusive trash pickup rights in Juneau.

After Arrow rejected an offer from the city, deputy City Manager Kim Kiefer spoke to the RCA, which grants the certificates, and asked about the city's options. The RCA told her the city could apply for a certificate separate from Arrow's existing one.

"The CBJ is looking at all different options at how to move forward. This is another option to us," Kiefer said.

Though she said entering the trash business probably isn't "where we're going" as a city; it is one option to consider. Another would be for the city to contract with another company for trash pickup.

Kiefer said the city isn't currently negotiating with Arrow, but that could change.

City Manager Rod Swope said in a March meeting that the certificate could have a value of millions of dollars. Assembly members expressed shock at the figure, saying it was the first time they'd heard the certificate might come with that high a price tag. At the same meeting the Assembly decided against forcing mandatory trash pickup.

"Everybody was just under the assumption there was only one certificate," Kiefer said. "It depends on who you talk to if there's a value for the certificate and what that value is."

Alaska Pacific Environmental Services General Manager Glen Thompson said the city presented the company with a draft contract in which the city was "trying to separate parts of the business up."

Matt Dull, Arrow's operations manager, said the city offered a value for the certificate which was much less than what Arrow perceives it to be.

Both Dull and Thompson declined to specify the amount at which Arrow values the certificate.

Thompson, who had not heard of the city's decision to apply for a certificate, said he was "surprised (the city) would take this precipitous avenue."

Thompson said under state law the city has to purchase Arrow's certificate at fair market value and that the matter could end up in litigation.

"I don't know their intention in getting their own certificate," Thompson said. "Competition with a private enterprise? To strong-arm us into capitulating? They have not communicated this move to us. It just seems a little heavy handed to me. It sounds like they're trying to circumvent our position."

City Attorney John Hartle said that the state law Thompson cited applies to Arrow's certificate, not a separate one the RCA could grant the city.

"They'll have theirs, the city will have ours - if the RCA grants it," he said. "We're not trying to take theirs."

Hartle said two separate, private entities held certificates in Juneau the 1980s.

RCA spokeswoman Grace Salazar said any entity can provide service in a community if the commission determines they are "willing and able to provide service" and if they are providing that service to more than 10 people. She also said more than one entity can provide service in the same area.

Thompson said he would confer with the company's partners and lawyers to determine where the company goes from here.

The Assembly directed staff to apply for the certificate after an executive session on negotiations with Arrow on Monday. The application was mailed Friday.

The application process is at least 180 days.

• Contact reporter Mary Catharine Martin at 523-2276 or maryc.martin@juneauempire.com.



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