Bill Hulet Editor

Here's the thing. A lot of important local issues are really complex. And to understand them we need more than "sound bites" and knee-jerk ideology. The Guelph Back-Grounder is a place where people can read the background information that explains why things are the way they are, and, the complex issues that people have to negotiate if they want to make Guelph a better city. No anger, just the facts.


Monday, March 19, 2018

The Draft Blue Box Program Plan

Guelph was at one time a North American leader in how it deals with garbage because it imported the Wet/Dry system from Europe. There was a complex set of reasons why it did this, and I originally wanted to write a story about that. It involved a landfill that was quickly getting filled-up, provincial regulations that made it very difficult to find a replacement, slick salesmen who had half-convinced Council to pay for an incinerator (which would have, in retrospect, been a total disaster), and an unsung community activist or two who just about killed themselves researching and making the case for the Wet Dry. Unfortunately for that story (and all the effort myself and others have put into researching it) time marches on, and I ended up getting drawn into a different direction. (That's the risk you run when you actually do some research, it gets in the way of the neat little plot outline you begin with.) This is the third and final---at least for a while---part of my story about solid waste in Ontario and what it means for the city of Guelph.

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I hope that one of the lessons that readers of my blog are learning is that Guelph Council is very much a creature of the province. That is to say, whatever powers our local municipality has are constrained by the laws that the province puts into place. To some extent this is an artificial state of affairs caused by Queen's Park being unwilling to grant the necessary power to the city. It also comes down to a matter of funding. Unlike many places in the USA, cities in Ontario cannot raise money through local sales or income taxes, which only leaves property taxes---which aren't enough to pay for many of the important things that cities do. And if the province is "paying the piper", it gets to "call the tune". But even after writing the above, it is true that in many cases the problems that cities face cannot be dealt with through a piece-meal basis. There simply has to be an outside body that creates a standard practice that governs how something is done across the entire province---if not the entire country and world. Solid waste is one of these things.

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In my last post I tried to explain that the provincial government has embarked on an ambitious long-term project to totally eliminate "garbage" in Ontario. The legislation to do that has already been passed as "The Waste-Free Ontario Act" and explicitly creates a time-line to transition the province to what it calls "The Circular Economy".

From Page 5 of "Strategy for a Waste-Free Ontario"
Ontario government publication (click on it for bigger version)

As you can see from the above diagram, the province doesn't just want to come up with a better system for picking up and dealing with the trash on the curb. It also wants businesses to take responsibility for what happens after they sell something.  Can the product be repaired? Reused? How easy is it to recycle? How much packaging is going to be left over after the "unboxing"? Can it be recycled?

The way the province wanted to do this was by creating a price mechanism that forced producers and distributors to think about these issues. It's already the case that one half of the cost of our local waste department is paid for through these fees. And instead of trying to directly meddle in the affairs of business people (something they really hate), the Waste-Free Ontario Act asked them to come up with their own plan. The business organization that the Act set up, Stewardship Ontario, has done this with their draft "Blue Box Program Plan". And, as I also pointed-out, the stand alone agency that the province set up to oversee Stewardship Ontario, the "Resource Productivity & Recovery Authority", is supposed to make sure that the business community didn't pull any "shenanigans" like they've done in the past.

Well, it doesn't seem like the system worked exactly like it was supposed too.

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If you look through Stewardship Ontario's draft Blue Box Program Plan it's really hard to figure out exactly what's going on. It's 52 pages long and is tremendously dense with lots of jargon (I had to write out several acronyms and check these notes repeatedly to remind myself exactly what was being talked about.)  In fact, I found myself thinking at one point that it wasn't really a plan so much as a 52 page long contract written by a bunch of lawyers.

If you look at the responses from the Resource Productivity & Recovery Authority (here, here, here, and, here), none of them seem to be actual critiques of the proposal put forward by Stewardship Ontario, instead they are neutral statements saying that the various stakeholders (ie: individual municipalities, associations of municipalities, and, NGOs) should have been invited to comment on the proposal. Luckily for the citizens of Ontario and the issue of transparency, these groups eventually did---and in language that ordinary people can understand.

Instead of listing all the various groups that participated in the 133 page response by the Association of Municipalities of Ontario (AMO) to the Stewardship Ontario proposal, I'll just post the letterhead. As you can see, there is a very nice selection of both prominent NGOs and Municipal government organisations:

As usual, click on the above for a bigger version.

A shorter, more easily digested, 5 page response just from municipalities also exists. It has a less diverse set of logos on the letter, but it's still kinda pretty.


Look Ma!, no NGOs!

There was also a 7 page staff report to Guelph Council on the proposed Blue Box Program Plan that was tabled in December of last year.  In addition, I asked for and was sent a further 6 page follow-up from staff to Council date February 2nd 2018 that I couldn't find on the website. (I couldn't add a link to it. It might not be up yet, or, I simply couldn't find it.)

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From my own totally non-expert read, what the Stewardship Ontario draft Blue Box Program Plan deals with is how to streamline recycling. To that end, it suggests a "catchment" system that would amalgamate various municipal recycling systems. This would mean that various smaller municipalities would find their system integrated with those of neighbouring ones to harness economies of scale. At the same time, what is or is not part of the recycling cycle would be harmonized---some municipalities (like Guelph) that already recycle a lot of different types of materials might find that the list of things accepted would shrink, while others would have what they pick up expanded. At the same time, the program suggests a range of various financial systems to ensure that competitive bidding is done to ensure that the free market would be able to find the most "efficient" and cheapest systems for collecting, sorting, and, reselling recycled materials.

One of the first red lights that Guelph staff identified in the draft Blue Box Program Plan deals with how the proposal wants to integrate "legacy" systems, like the Guelph Wet/Dry program.

Stewardship Ontario is proposing that municipalities with material recovery facilities, such as Guelph, would need to bid on material to receive and process in their facility. This proposal includes a requirement that the municipality be able to competitively bid and win the processing contract to process its own depot and curbside material. The amount and type of material for tender would be based on the tonnage generated within a predefined geographical area that may not be based on municipal boundaries. A proposed sample provided by Stewardship Ontario included Simcoe County, Dufferin County and the Region of York as one catchment area.
P 2-3 of December 15/2017 information Report to Guelph Council
"Proposed Amended Blue Box Program Plan"

Rightly, the staff are concerned about a bidding process leaving all the capital that the city has already expended "high and dry". What happens if the city bids and loses? Will it have to sell the garbage trucks, lay off all the staff, bulldoze it's facilities, and, sell the land off to developers? More importantly, the whole idea of having competitive bids for the processing facilities misses the entire point of using cost incentives to change behaviour. The Waste-Free Economy Act is not meant to be about creating a very efficient and inexpensive recycling program, it's supposed to be about getting businesses to stop creating mountains of garbage in the first place. In fact, to really work well as an cost-based incentive to get businesses to change their behaviour, it would make more sense to use gold-plated garbage trucks and pay everyone on the sorting line $100,000/year---as long as the full cost for all of this is paid by the businesses creating and importing all this crap.

The January 15th response to the draft Blue Box Program Plan (ie: the "BBPP") by the group of municipal organizations and NGOs discussed this problem in their joint response. (The "RRCEA" is the "Resource Recovery and Circular Economy Act", and, "SO" is "Stewardship Ontario".)
The objective of the a-BBPP as set out in the Minister’s Direction Letter was to set the stage for a second phase of transition that will result in individual producer responsibility under the RRCEA in a timely manner. The key stakeholders understood the current system was not progressing and a move to the new legislative framework could resolve key problems. One significant improvement the RRCEA affords is allowing individual stewards the opportunity to choose how best to meet their obligations under the new Act. Under this Minister’s Directive we expected the a-BBPP would provide an interim step to ease transition from a municipally-operated Blue Box system to direct steward management. This was not meant to be the end point of this process. The proposed a-BBPP and associated timeline potentially entrench and further invest in the existing structure, potentially hindering the transition to the RRCEA. The timeline proposed is seven years to transition municipal programs fully over to SO and nine years until any targets are to be achieved. This is four years beyond the target of 2023 set out in the Strategy for a Waste-Free Ontario. This is not an acceptable timeline.
P-2 of the January 15th letter to Glenda Gies, 
Chair of Resource Productivity and Recovery Authority,
by the Association of Municipalities of Ontario

For these two, and a couple other, reasons, all the various municipalities and non-profits suggested to the Minister of the Environment and Climate Change that he reject the proposed Blue Box Program Plan, which he did. It has been sent back for more consultation to develop another plan that takes into account the issues raised already.

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To be fair to Stewardship Ontario, they are tasked with a very big and complex task. But as I have documented through all three of my articles in this series--starting with green-washing disposable coffee pods, through using the "eco-fee" system to both over-charge customers and make them think of it as a "tax grab", to trying to use the draft Blue Box Program Plan to slow down and stall the transition to a waste-free Ontario--a case can be made that the business community has tried to sabotage any attempt by society to cut back on the solid waste that they create. Having said that, I think readers should understand that a case could be made that it would be against the law for it to do anything else. To understand this point, you need to understand what is called the "fiduciary duty" of managers in for-profit corporations.
In Canada, directors are regarded as fiduciaries of their corporation and, as such, directors must ensure the corporation’s interests are paramount. It is the fiduciary duty of the director to act honestly and in good faith, with a view to the best interests of the corporation. If a director fails to meet his or her fiduciary duty, courts will hold the director strictly liable.
From the MacMillan LLP Co website, "Duties & Liabilities of Directors in Canada

Just let the impact of those few sentences sink in. It means that not only are the directors of a corporation not required to consider the community interest---it means that it would be against the law for them to do so unless there is a specific government regulation that forces them. In other words, if there was no specific law saying that it is illegal to grind up children and make them into "prestige" dog food, and a business case could be made that this would be a profitable enterprise, someone on the board of directors of a company could be held legally liable if she forbade the managers from doing such a thing purely on ethical grounds. (This is what a philosopher calls an "reductio ad absurdum", or, showing the failure of an argument by showing how following it in some exceptional cases leads to ridiculous results.)

The ideology of fiduciary duty permeates the business community. It explains why pharmaceutical companies jack-up the cost of medicine in the USA (where there is no single-pay system to control costs), it explains why companies used to send children into coal mines and why they still try to avoid safety regulations. Refusing to consider the public good is part of the "moral code" that defines our business class.

Yet another example of fiduciary responsibility,
image c/o Welsh Mining Museaum, copyright expired.
Is this really all that far from making children into dog food?

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We are coming up on a couple of elections this year and I think that there are a some things that voters should take away from these three articles.

First, there has been a bit of talk about how Guelph needs to "privatize" garbage pick up and recycling. As I hope readers will realize, this really should be a non-starter for municipal governments because the private sector is already paying half the price of everything right now and is on track to eventually pay 100%.
If in the next provincial election we elect a Liberal and/or NDP government, the process of moving towards a Waste-Free Ontario will continue and Guelph will eventually not have to pay anything at all for pickup and processing. In contrast, if the Conservatives win, the Stewardship Ontario proposal (or something like it) may be adopted, in which case waste pick up will be probably be privatized whether the city wants it or not (unless it wins the competitive bidding process---in which case privatization wouldn't have worked anyway.)

Secondly, I hope I've also made clear how important it is to elect the right government for Ontario. The world is already crazy complex, and it's getting even more so all the time. This means that a huge amount of government decision-making doesn't go through the formal parliamentary process, but instead gets decided on the ministerial level by ministers, bureaucrats working for the ministry, or, NGOs who's boards were set up by the ministry. In the case of solid waste, we have two NGOs---Stewardship Ontario and the Resource Productivity & Recovery Authority---who tried to come up with a plan. Stewardship Ontario tried to pull a "fast one", the Resource Productivity & Recovery Authority pointed out that they should have done a lot more consultation, and, the Minister told them to go back to the drawing board. If we elect a new government this summer that doesn't really care all that much about moving towards a circular economy, doesn't bother reading the fine print, and, is mostly driven by ideology instead of facts, they can simply appoint a minister who will just rubber stamp whatever Stewardship Ontario presents to him and we can get ready for the avalanche of garbage to continue to get bigger every year. 


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