Bad news kept piling up for the Ratto Group — complaints about customer service, a damning audit, cease-and-desist orders targeting the company’s recycling facilities and the prospect of steep fines for contract and regulatory violations.
It seemed unlikely that Ratto could hang on to its trash collection franchise in Santa Rosa, where bids were due Monday.
So it wasn’t much of a surprise to learn that James Ratto is selling the company, a decision that will have ripple effects across Sonoma County.
Recology, a San Francisco-based waste-hauler with a reputation for maximizing recycling, agreed to buy the Ratto Group, which has contracts to collect trash in eight cities and most of unincorporated Sonoma County. The sale isn’t final, but “the question is what’s the price, not if there’s a deal,” according to Ratto spokesman Eric Koenigshofer.
There will be plenty of other questions before this transaction is completed, including what, if any, additional services Recology will offer its new customers — and at what cost. Also to be determined is whether Santa Rosa will select Recology from a field of five bidders for the city’s trash contract. Ratto’s contract runs through this year.
Ratto secured the Santa Rosa franchise in 2002 with a promise of low rates, and the city extended the agreement without seeking competing bids in 2012.
Local rates remain among the lowest in the North Bay, but customers haven’t been getting what they pay for.
Since winning renewal of its Santa Rosa franchise, the Ratto Group has scaled back on what it accepts in its blue recycling buckets, blaming Betper declining demand for discarded plastic, glass and paper. In a community with a demonstrated commitment to reuse and recycling, the cutbacks prompted complaints that the Ratto Group was violating the terms of its contract, which spells out recycling requirements.
A scathing audit delivered to Santa Rosa city officials last summer concluded that the company had fallen short of its recycling obligations, failed to replace aging garbage trucks as required and was operating an unpermitted recycling facility. The audit also criticized the Ratto Group’s management, customer service and billing operations.
The company faces $14 million in fines for alleged violations of its Santa Rosa contract, plus more sanctions for alleged permit violations at its recycling facilities on Standish Avenue.
Recology, in contrast, has delivered high recycling rates in communities it serves in California, Oregon and Washington. In San Francisco, where the company collects food scraps for composting in addition to traditional recycling efforts, about 80 percent of waste is diverted from landfills. That’s more than double the diversion rate in Santa Rosa, according to the 2016 audit report.
San Francisco residents also pay about double what we pay here for trash collection, but they apparently aren’t being shortchanged on their service.
Santa Rosa officials plan to take several weeks to assess bids for the city’s garbage contract. It’s also likely to take several weeks to complete the sale of the Ratto Group and the transfer of its contracts to Recology. Some will push for the lowest cost, but local residents have an admirable record of supporting conservation and recycling, and we’re confident that they expect the same of their waste haulers.
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