UPDATE: Santa Rosa City Council voted this week to not extend North Bay Corp.'s contract and instead offer other companies the chance to bid on the exclusive waste and recycling collection contract with the city. 

The decision comes after the city conducted a thorough audit of the hauler, only to find issues such as lower-than-expected recycling rates and a percentage of cans that are left tipped over. Councilman Chris Coursey told The Press Democrat that the company's fleet of older-than-allowed trucks was one of the biggest red flags from the audit, highlighting safety and environmental concerns.

North Bay disputed the findings from the audit, and some city officials are concerned that a new service contract will lead to higher collection costs in the city. However William Schoen of R3 consulting explained to the Democrat that North Bay's low rates were likely the driving force behind the company's service issues. 

Santa Rosa City Council authorized $150,000 for the production of RFPs from qualified garbage companies, according to the Democrat.

Dive Brief:

• The Santa Rosa City Council is set to review a tough audit of garbage hauler The Ratto Group, but the company's general manager, Rick Downey, won't be there to defend it after resigning last week.
• Downey said James Ratto, the company's owner, broke a promise to allow him control over daily operations and had begun to undermine his authority.
• The hauler North Bay Corp., part of The Ratto Group, is also under fire after an audit found numerous violations. The city has indicated it may not renew the company's contract. 

Dive Insight:

Downey previously ran the Sonoma County landfill for Republic Services and was hired by Ratto last year to help turn operations around. The company has a long history in the area—winning every contract in the county with the exception of Sonoma since 1997—but has had issues in recent years. 

The audit of North Bay highlighted problems with customer satisfaction, recycling rates, and an aging fleet along with permit issues at the company's local recycling centers. This could mean expensive fines and the loss of a contract that generated $27 million for the company last year. Downey had previously said that North Bay might not be interested in a renewal unless the city paid more to balance out low commodity prices. It's unclear whether the company will stick with that position.

Low commodity prices have become challenging for many companies in California's recycling industry. Redemption centers have been among the hardest hit and are closing in droves. They're the subject of new state legislation that aims to help temporarily stabilize the situation, though many say a longer-term fix is needed.