Dive Brief:
- New York City’s Department of Sanitation recently shuffled the rollout timing for parts of its commercial waste zone system, including in areas where haulers with awarded contracts were recently acquired. The agency is still planning full implementation by the end of 2027.
- The agency proposed moving Upper Manhattan up from being one of the last zones to launch to now starting Oct. 1, alongside Brooklyn North. Queens West, previously scheduled to launch this month, was delayed for unspecified reasons. Manhattan Southwest and Midtown North were moved later in the schedule.
- Six zones have launched to date, including Lower Manhattan this month. The next to go live will be Midtown South and Staten Island on July 1. Customers have a two-month period to sign up for service between the time when zones launch and their full implementation.
Dive Insight:
The city’s long-discussed commercial waste zone system is coming to fruition, but industry consolidation has made for a complex process along the way. New York’s model is different than exclusive franchise models in other cities as it’s designed for up to three haulers per zone.
New York’s existing open market system had largely avoided the wave of consolidation seen elsewhere, as companies waited to see if a zone law would pass. That law passed in 2019, but implementation was slowed by the pandemic and other factors. Once contracts were awarded in early 2024, the expected round of M&A kicked off. More than a dozen deals have occurred since, though the pace has slowed this year.
Many companies that didn’t fare well with contract awards sold some or all of their assets, primarily to lead awardees Interstate Waste Services and Waste Connections. The system has a 15-zone cap for all haulers, which both companies exceeded due to purchases in 2024 and 2025.
DSNY awarded contracts to two new haulers approximately one year after Waste Connections’ purchase of fellow awardee Royal Waste Services created vacancies. This included the Queens West zone.
IWS subsidiary Action Environmental’s purchase of fellow awardee Filco Carting late last year also created pending vacancies in the recently shifted Manhattan Southwest and Midtown North zones. It also opened up a slot for one of five citywide containerized contracts.
“Any changes to awarded zones, including those resulting from mergers or other market developments, are evaluated in accordance with procurement rules and the CWZ agreements. We will post updates when they are made,” said DSNY Press Secretary Vincent Gragnani via email in response to questions about contract awards and timing in the two zones. “Any adjustments made on timing reflect operational readiness and market conditions to ensure a stable transition for customers and carters.”
DSNY asked prior bidders last fall if they were still interested in new contracts, though the number of available options has decreased since bidding first occurred.
Meanwhile, some other aspects of implementation have attracted legal challenges. A suit led by the National Waste & Recycling Association and certain member companies challenging a DSNY waste survey rule is still pending, though Cogent Waste Solutions recently moved to exit the case. Century Waste Services’ suit against DSNY for not receiving a zone award on Staten Island also remains pending.
At the same time, environmental advocates who pushed for the zoning law in a bid to boost recycling, improve safety and reduce vehicle miles traveled have called on new Mayor Zohran Mamdani to speed up implementation.
New DSNY Commissioner Greg Anderson reiterated plans to implement the system by the end of next year when asked during an April 6 city council committee hearing. Anderson, who recently returned to the agency after time spent working for his predecessor Kathryn Garcia in state government, was a key player in the initial implementation of the 2019 waste zone law.
Anderson also confirmed DSNY has sufficient staffing to conduct implementation and enforcement, which is a newer task for an agency that primarily focuses on residential waste. The city’s proposed Fiscal Year 2027 budget includes funding to maintain 37 staff members working on the program.
Anderson separately noted a desire to see the industry “stabilize” before making other related policy decisions such as sending commercial waste to city-owned transfer stations. He was also asked about any potential implementation issues in Queens West.
“I think there’s market consolidation that’s taking place in the commercial waste industry that we are having to account for as we roll out zones to make sure that we’re still offering businesses a choice of three carters per zone,” said Anderson. “As we roll out additional zones we want to make sure there are three carters available.”
DSNY awarded a new contract to Tully Environmental in that zone last fall. Gragnani confirmed via email that Tully remains an awardee and said “implementation is proceeding as planned.”
The latest shift in zone implementation timing is considered less notable for awardees. It’s more relevant for non-awardees still operating under the current open market system in areas that haven’t transitioned yet.
Those companies are primarily overseen by the city’s Business Integrity Commission. Mamdani appointed Asim Rehman as commissioner of BIC last week. Rehman previously led the city’s Office of Administrative Trials and Hearings — which handles violations for industries including trade waste — as commissioner and chief administrative law judge. A city release said Rehman will “work to improve traffic and worker safety in the trade waste industry” and “ensure that regulated companies conduct their business fairly and with integrity.”
A key part of BIC’s authority is a commercial waste rate cap, which still applies to companies operating outside of implemented zones. The recent war-driven spike in diesel prices has led some to speculate whether the agency might consider increasing that cap.
BIC is required to hold rate cap hearings by Oct. 31 of every odd-numbered year. An agency spokesperson said the last hearing was Aug. 20, 2025, and didn’t offer any further details about when the next one may occur.
