Policy Study

Privatizing Landfills

Market Solutions for Solid-waste Disposal

Executive Summary

Local governments face increasing regulatory costs in owning and operating landfills, as well as ever more difficult challenges in finding politically acceptable locations for new facilities to replace old ones or accommodate new landfill growth. Many governments have responded to these regulatory and siting challenges by privatizing their landfills.

Privatization of landfills is a growing trend-the percentage of facilities owned by the public sector declined from 83 percent in 1984 to 73 percent in 1997 and to 64 percent in 1998. And a 1998 R. W. Beck survey showed that 27 percent of municipalities with populations greater than 100,000 were considering privatization as an option to fulfill their disposal needs.

The many reasons for this privatization trend include managing liabilities, improving efficiency, cutting costs or debt, improving access to capital, and improving accountability. Each reason, or combination of reasons, lends itself to a different option for managing landfills. Privatization options range from cooperative agreements with private firms for support services to management contracts, asset sales, and even complete reliance on the landfill market for services.

To help public officials understand these options, as well as emerging policy issues such as consolidation in the solid-waste industry and attempts to control the flow of solid waste between states, this report examines in depth various objections to privatization, presents a number of detailed case studies of landfill privatization, and provides a short “how-to” guide for privatization.