Take caution on franchising

Last week, the Chico City Council approved a supplemental budget appropriation of nearly $100,000 to hire a consultant with expertise in waste-hauling franchising—something the panel is considering establishing. During the meeting, several council members were very clearly in support of the idea, which—if estimates from the dais and city management are accurate—could bring in $1.5 million to $2 million annually.

In addition to buoying the city’s general fund, the establishment of a franchise agreement would have a number of other beneficial outcomes. Currently, two waste-hauling companies—which pay a so-called “fee agreement”—traverse the same residential streets, creating extra wear and tear on the roadways. A franchise agreement would eliminate that inefficiency by, say, creating zones that would keep the two companies within particular regions of the city, or franchising with only a single company. In addition, either of these changes would mitigate smog production.

From several standpoints, franchising seems like a no-brainer. So, what’s the rub? Well, there’s a big one.

A franchise agreement may translate into a multimillion-dollar windfall for the city, but it won’t come without a price tag. And that price tag will be paid for by every resident who has trash collection. That’s why we want to urge the council to proceed with caution and to help ensure that it will not place an undue burden on the community, especially those who live on commercial properties and may be on a fixed income.

Trash collection at commercial properties is already efficiently run, so the companies conducting that work likely won’t see any savings like they would in residential areas. In other words, the haulers will have no choice but to pass on the franchise fees to their customers, and the ones of lowest income are likely to take the brunt of it. It’s the council’s job to make sure that doesn’t happen.