Dive Brief:

• Filco Carting is expanding into the New Jersey market with two residential collection contracts that started this month. The hauler, which has a sizable presence in New York City, received its A901 license last year to allow for operations in New Jersey.
• The largest of the two is a $1.4 million emergency contract with the city of Paterson to provide residential waste collection through the end of March. The city decided to take this step while a lawsuit is pending from its former hauler over the decision to award Filco a five-year contract worth up to $25 million.
• Additionally, Filco began residential waste and recycling collection service in the smaller borough of Cresskill. The company has also moved its corporate office to nearby Closter, New Jersey, from Brooklyn.

Dive Insight:

Filco, which has become one of the larger independently-owned commercial haulers in New York City since it was founded in 1910, has been looking to grow in recent years.

This includes bidding for contracts in the pending New York commercial waste zone system, plus looking at opportunities in New Jersey and Long Island. According to the company, it now services “nearly 5,000 commercial, residential, industrial, and institutional firms in the New York City Metro Area.”

This strategy is directed by President and CEO Domenic Monopoli, a fourth-generation leader who took sole ownership of the company in 2019. After building up Filco’s commercial business in New York, including multiple contracts with large public utilities, he described the expansion to New Jersey as “the next frontier” in a 2022 interview.

“We felt it was the most logical place to expand our business into for a few reasons. The first being that Filco’s executive team was born and raised in New Jersey. The second reason is that a lot of the executive team has contacts in the state of New Jersey to help expand Filco’s footprint,” said Monopoli in a recent statement.

The contract in Cresskill, where Monopoli grew up, was previously held by Interstate Waste Services — a major regional company with private equity backing.

The contract in Paterson was previously held by Suburban Disposal, also known as Roselle, which is one of the state’s larger independent haulers. That switch has been more contentious. 

Following the Paterson City Council’s Sept. 5 decision to award Filco a contract, Suburban sued its competitor and the city. A third company, E&B Hauling Services, also bid. Filco was the lowest of the three bidders, with a proposal approximately $10 million under Suburban’s.

In its suit, Suburban alleged that “Filco's bid submission was materially defective because it included a bid guarantee that was not for the statutory amount and form set forth under the Local Public Contracts Law.” The company also raised issues about other bid disclosure technicalities. In October, Superior Court Judge Rudolph Filko found that “Filco’s bid guarantee was fully compliant with LCPL.” He refuted Suburban’s other allegations and dismissed the case. 

Suburban appealed the decision and requested a stay on the contract award, citing concerns about potential service disruptions. At the time, an attorney for Filco opposed this request, saying the current contract with Suburban was “an albatross around the city’s neck.”

Paterson joined in this position and the council awarded an emergency contract to Filco on Dec. 5, which Suburban disputed. Suburban’s attorney did not respond to a request for comment about Filco starting service this week.

“For over 20 years we've used the same garbage collection program and the costs continue to rise as far as collection is concerned,” said Mayor Andre Sayegh during a Dec. 20 public meeting, citing an estimated cost savings of $200,000 per month. "By optimizing the collection process we can achieve greater cost efficiency, ensure the sustainability of our garbage collection services in the long term.”

Costs were elevated in part because Suburban had been servicing Paterson under its own emergency contract, following the expiration of a longer-term agreement. The city reportedly struggled to receive competitive bids in prior years and local officials had complained about the hauler’s service.

In addition to reorganizing collection routes into three zones, the new system also found savings by shifting bulk furniture pickup responsibilities to city crews who already perform recycling service. As part of this change, Paterson is encouraging residents to drop off bulk items directly at a city yard.

Filco held a hiring event late last month to bring on dozens of new employees. During the Dec. 20 meeting, Department of Public Works Director William Rodriguez said “we had hundreds of Patersonians come out looking for job opportunities" and noted that Filco planned to hold a safety training ahead of launching service on Jan. 2.

The next court hearing over Suburban’s appeal is scheduled for March. Filco’s current emergency contract allows the possibility of monthly extensions, for up to six months, and the company plans to keep competing in the state.

“We are going to be actively bidding on as many Bergen County towns that will come out to bid,” said Monopoli. “One of our major goals as we expand Filco’s presence into New Jersey is that we continue to service our core business in New York City with laser focus.”

News about Filco’s fate in New York City is expected in the near future. The city’s Department of Sanitation is set to award long-term contracts soon and begin piloting certain areas of the zone system later this year.