Dive Brief:

• The city of Paterson, NJ, is proposing to extend the services of a private hauler for $3.15 million. The contract would expire at the end of March 2016.
• The city initially intended to hire municipal employees for waste collections, in an effort to conserve funds.
• Paterson Mayor Jose Torres and his administration concluded that the city would benefit from privatizing the waste services. The decision was reached after reviewing the results of a study detailing waste collection in Paterson.

Dive Insight:

The mayor attributed his decision to the substantial costs associated with using a municipal workforce, including hiring additional employees, worker's compensation, and the need to purchase equipment. The City Council will make the final decision regarding the extended contract. Paterson's current contract is with Suburban Disposal of Fairfield, NJ.

In general, many cities view the privatization of public services, such as waste collection, as a way to save money. Towns in Illinois and South Carolina have considered contracts with private waste firms advantageous to their bottom lines. 

Detroit slashed its collection costs by an estimated $15 million by eventually contracting services with private companies. The city finalized the deal in November 2013, when it decided to privatize and awarded the citywide contracts to two firms.