History of Benz conflict

Rebecca Neipp

News Review Staff Writer

As the public has viewed from the sidelines (and sometimes from the center of) the clash between the city and the other major players in the years-long trash controversy, one of the greatest challenges has been staying abreast of the ever-unfolding developments and disparate interpretations.

Although some say the groundwork for those convoluted events was laid when the city failed to adopt a large-scale recycling program in the 1990s when the state began passing mandates, events did not come to a head until about six years ago.

In 2006 the California Integrated Waste Management Board put the city of Ridgecrest on notice for its apparent failure to comply with the state mandate of diverting 50 percent or more of solid waste into the recycling stream.

In 2007 city officials signed a Local Area Plan, which outlined an agreement to conduct an updated solid waste study and implement various recycling programs — one of which was the mandatory curbside collection of trash and recycling for all residents.

Before the deadline for completion of those terms, Ridgecrest — emboldened by city documentation showing compliance and the backing of the Kern County Waste Management Department — delayed execution of the LAP. But the state discredited the city’s formula, fined Ridgecrest and threatened further penalties if a mandatory program was not initiated immediately.

Because of the city’s 10-year contract with Benz for trash collection, city officials determined that, in order to collect reliable diversion data, the same vendor should perform both services. Benz said it would have to charge more than double the previous rate to recoup the cost of capital outlay and service. With no competing bids, the city reluctantly agreed. By late 2009 the program was up and running.

Residents decried the much-higher rates they were now forced to pay. That outrage fueled lawsuits against Benz and the city, as well as recall attempts against members of the council.

When then-Gov. Arnold Schwarzenegger disbanded the CIWMB in 2010 and Cal Recycles absorbed its responsibilities, the new oversight agency relaxed its stance and authorized the city to allow residential opt-out of the service.

Then Benz objected, saying it could not recover its initial investment based on the revised business model. After months of contention between the city and Benz, the city attorney discovered that the city was in violation of its own municipal code by allowing Benz to continue its franchise without the service being put back out to bid (which an ordinance requires every 30 years, due that year).

Benz then filed a $63-million claim against the city based on what Benz believed was the value of 10 years of lost service. After months more of civil litigation between the city and vendor, a judge upheld the city’s interpretation that the franchise had expired and sent the two entities into arbitration to see who owed money to whom. (Part of the settlement of Benz’ plea deal was to remit unpaid franchise fees to the city.)

In September 2011 the city put the service back out to bid and ultimately awarded the new contract to Waste Management.

When Waste Management first took over, the company’s recycling numbers were 40 percent higher than those reported by Benz. City and state officials began investigating the discrepancy, and ultimately the matter came before the California Attorney General.

The A.G.’s office opened an investigation, and because of massive layoffs of state investigators, the Ridgecrest Police Department was sanctioned to conduct the investigation, which began late last year. RPD was assisted by members of the Federal Bureau of Investigation and Kern County Sheriff’s Office.

See related story, this page, for an account of that investigation and discoveries yielded.

Story First Published: 2012-11-07