Apartment Management Magazine Shock and Anger Over the L.A. City Waste Haulers’ 6.15% Increase
By Albert Mass
I was shocked and angry that the City of Los Angeles City Council allowed the city’s garbage haulers to increase garbage removal fees by 6.15% starting in January as increases in rent is frozen, late fees and interest are prohibited and evictions are prohibited. Because I am unable to increase the rent for my building (let alone collect it from tenants now living for free under the disguise of a COVID impact) during this global pandemic, the City should demand from its monopoly waste carriers that they freeze the prices. This is particularly the case, and the City should take responsibility for it, as it was the City that established its anti-competitive monopoly agreement known as “RecycLA” which imposes and forces on me and thousands of people. other landowners steadily increasing waste transportation costs. It was the City that negotiated the waste transport rates and chose my waste transporter, not me.
It all started in 2017 when owners were shocked and dismayed at the huge fee increases implemented as well as horrific service levels so the city could extort franchise fees of $ 25-35 million from owners. on the basis of a “10% catch”. gross receipts of waste haulers. Gone are the hundreds of waste haulers competing for our business, leaving us with only 7 exclusive rights each to serve designated territories in the city. For the City, there is no back skin – the more owners pay, the more the City earns. But there is no doubt about it. A 10% franchise fee is nothing more than a tax on homeowners.
The City has the right to establish service criteria with which the waste hauler must comply, such as diversion rates, and to compel licensed waste haulers to comply. But the City does not have the right to tell us which waste haulers that meet City standards we must use at all costs. By choosing the “one and only” waste hauler that we must agree to use, the City has created a monopoly that will surely lead to greater pricing and continued corruption. The corruption here is that the City has negotiated a 10% rebound in the gross revenues of waste haulers. The corruption here is that the city has set the prices and eliminated the competition. The corruption here is the City has negotiated price increases such as the initial rate increases from 200% to 400% and now the mandatory 6.15% increase with others to follow in the future. The crime here is now forcing landowners to pay these exorbitant tariffs to monopoly waste haulers while our revenues are frozen and, for many, uncollectible. The corruption of the city is at the bottom.
Normally, if we weren’t faced with a global pandemic and lived under emergency orders, landlords could recoup some of the increased costs by raising our tenants’ rent let alone have a much better chance of collecting. the rent in the first place under the terms of our rental contacts. However, Los Angeles Mayor Garcetti has issued an emergency order that prevents rent increases, evictions, and the charging of interest and late fees, whether governed by contact or not, for the moment.
Recently, I contacted Los Angeles City Council member Paul Koretz about this. As I put it in my letter to Mr. Koretz along with a copy of my latest garbage haulage bill, “I am shocked and dismayed at the city council’s lack of concern and the inappropriateness of a 6.15% price increase by waste haulers when there is a problem. rent freeze and economic difficulties shared by all businesses in the city of Los Angeles. I then suggested that “the 6.15% price increase should be reversed.” Council Member Koretz’s office responded, “I will talk to the Council Member about other avenues we can take to resolve this issue, as I and we realize this is another burden our owners face.” I later received the following from one of the staff at Council Member Koretz:
“Hello Mr. Mass, thank you very much for sharing your frustrations with our office about this fee increase. The Council member realizes how frustrating this is for so many of our landlords, especially during the pandemic when rents are frozen and many tenants do not pay full rent or no rent at all. After reviewing your request, I’m sorry to say that we cannot freeze this fee increase. It is written in the contract that we have with the transport companies and we cannot modify it. ”
Of course, I can understand that the expenses of waste haulers are increasing, but so do mine. My expenses such as property taxes, utilities, insurance, labor costs for repairs and maintenance and more, are always on the rise. Yet unlike waste haulers, we landowners are never left behind and simply have to deal with it, regardless of the stress and financial hardship we face.
The real problem here is that the City is practically broke due to bad financial decisions and inflated retirement obligations, and in its desire to generate income, the City has chosen to negotiate a “good deal” for itself with waste carriers and create for them a monopoly that forces owners to use only the waste carriers that the City has chosen for us and eliminate the competition that we have enjoyed for decades and with that, our ability to choose a waste supplier for ourselves.
When the town of Compton raised the fees, its mayor went to jail. The City of Los Angeles has no business requiring real estate owners to use and eliminate the competition the city has enjoyed for decades. The City only has the right to set the standards that each of the suppliers must meet, but not to choose the supplier and dictate the conditions to the users so that the City can get a “bounce” in the form of a hidden tax. Sadly, and increasingly evident, City Council has become a “good ol ‘boys club” where their votes are unanimous on just about every issue that comes before them. All I can say to city council is that each of you can all slap each other for your horrendous story of voting and camaraderie – I hope for the next election we can place independent reflection in your offices which will not follow your trampled and corrupt policies.
I know there are a lot of good, well-meaning and conscientious staff and employees who work at City Hall. But I can’t say the same for city council members, including “do nothing” council member Paul Koretz. I urge them to look into this anti-competitive pricing and pricing system they have concocted and revoke this inappropriate price increase – more than ever, now is not the time to raise prices on which you can. do something.
Albert Mass is a rental housing provider in Los Angeles and is a member of the Apartment Association of Greater Los Angeles.
