As the last of a new round of garbage bins – toters, in industry parlance – banged into place in a neighborhood on Lafayette’s north side earlier this month, the sound was just the same as that of a starter’s pistol for a new financial relationship between the city and a Michigan company promising to monetize the city’s trash collection.
The new toters will hold garbage before it goes to a landfill. They’re smaller than the existing 96-gallon versions the city has been using. Those have become recycling bins, in hopes Lafayette residents will recycle more – which the city does not have to pay for – and throw away less, for which it pays about $40 per ton in so-called “tipping fees.”
The lids of those older, larger toters will soon be replaced by employees of National Cart Marketing, a Michigan company which sells ads to local businesses that appear on the lids.
“This is sort of like direct mail, but without the mail,” says National Cart Marketing CEO Phil Bonello. His background is in direct mail advertising and he says there’s a formula for which types of companies usually buy in to his plan.
“The local businesses that are competing with the big boxes in a town like Lafayette. So insurance companies, pizza companies, car dealerships, banks, financial services institutions,” he says.
NCM doesn’t have many clients yet, but one place that’s already using the doctored lids is Moline, Illinois.
“We took to it like a duck to water," says Moline Public Works Director Mike Waldron. "We have automated trash collection and on those trucks we wrap with a local cable company. And we had a revenue stream coming in on that, so when we heard about the potential for the lids, we kind of knew that our city council might be inclined to go that route as another source of revenue.”
Moline’s operation is a little smaller than Lafayette’s – about 16,000 advertising-adorned lids, versus about 21,500 in Lafayette. Phil Bonello says his company – which is set to pay Lafayette about $2 million over the course of a five-year contract – looks for Midwestern communities of at least 15,000 people to serve. And, according to Lafayette Mayor Tony Roswarski, the company will start getting invoices soon.
“The way the contract is written, once the toters are deployed, they’ve got to start paying us the monthly fee, whether their lid’s on it or not or whether they’ve sold one piece of advertising – they still owe us the monthly fee they agreed to,” Roswarski says.
Trouble is, Bonello says an internal manufacturing delay will mean all the lids won’t be rolled out until probably the end of the first quarter of 2016 – so his company is paying, but it’ll be at least a few months before it’ll be generating much revenue to cover those costs.
Bonello declined to say how much his company expects to make from the deal, but he did allow that the purchase of an entire lid’s worth of space would cost a company about $20,000 for 90 days in Lafayette. Bonello says it’s more likely that as many as a dozen companies will split the space, and that the lids will be printed in several configurations, so companies can advertise in their neighborhood.
The revenue Moline and Lafayette receive will help offset costs. Lafayette doesn’t want to start charging for trash and recycling pickup, so the money it receives keeps the service nominally free to residents.
Moline charges its citizens a trash fee, but Public Works Director Mike Waldron says he thinks the new revenue – about $70,000 a year – will help forestall future price hikes. However, he says some people have balked at the lids that generate the cash.
“Now you are going to have – and we experienced, too – some customers who don’t want them," he says. "It’s just a personal preference – I don’t want any advertising on my cart. We tried to explain to them the benefits to the city to hold costs down, but there were some people who just refused, don’t want it, and we went out and put our old carts on.”
In Lafayette, as the toters were delivered, city employee Leslie Chaney drove behind the flatbeds full of bins and noted the number on each as it was delivered. She says there’s been some confusion about the new system, with some residents wanting answers.
“Some chased us down the street,” Chaney laughs.
Lafayette might have started to make money from National Cart Marketing in October, but for a snafu of its own. When a semi full of the last batch of toters arrived from the manufacturer, they weren't for Lafayette, but for a company in Colorado.