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Are Recycling, Garbage Next on Chicago's Privatization Radar?

Chicago Mayor Richard Daley is already the undisputed urban privatization leader today, and if he follows the recommendation of an appointed government reform committee, recycling—and potentially all waste collection—could be among the next big privatization initiatives we see coming forward in the Windy City. According to the Chicago Sun-Times:

Mayor Daley should privatize household recycling, transfer control over city elections to County Clerk David Orr and let the county assume responsibility for "overflow patients" at city health clinics, according to a commission appointed to examine the scope and structure of government.

The 21st Century Commission co-chaired by the mayor's budget director and former top mayoral aide Sarah Pang is also recommending that Chicago:

Franchise waste pick-up by private haulers.
Use incentives and regulations to reduce the flow of waste to city landfills.
Install water meters in 350,000 households without them.
Raise curbside and public parking rates to reduce traffic congestion.
Cut truck traffic through a mix of "congestion-based tolling," off-peak deliveries, loading zone efficiencies and truck route improvements.
Establish a 311 system for businesses.

[. . .] Privatization has long been a sore point with organized labor and its City Council allies. But, the budget crisis that's forcing Daley to lay off 929 employees also threatens to slow or halt the citywide switch to recycling from blue carts that was expected to be completed by 2011 in all 600,000 households that get city garbage pick-up.

If household recycling is privatized, the city would be spared the expense of purchasing blue carts and separate recycling trucks, expected to exceed the cost of the failed blue-bag program by "$20 million or more." And collection costs could be reduced by as much as $7 million-a-year since most private haulers do the job with only one employee who drives the truck and gets out to pick up recyclables.

"The many benefits of such a plan include diminished capital costs, lower ongoing operational cost and a speedier city-wide adoption," the report states.

Daley appeared to embrace the idea.

"We're not in the business. When you take recycling products, it's a business. They look at it as a business -- completely different than us," he said.

Hinting at privatization of all refuse collection down the road, Daley said, "Garbage is looked at as a liability -- not an asset. It's an asset -- not a liability. That's why it costs you more and more money."

As budget shortfalls continue to mount, we need more public officials to recognize, like Mayor Daley, that government should not be in the business of business.

The 21st Century Commission's recommendations are here.

» Reason's Privatization Research and Commentary
» Reason's Annual Privatization Report 2008

Leonard Gilroy is Director of Government Reform


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