Dive Brief:

• Waste Connections is in the process of acquiring Upper Valley Disposal & Recycling Service, along with the Clover Flat Landfill, in California’s Napa Valley region. The news was initially reported by the Napa Valley Register and The Press Democrat.
• The Upper Valley Waste Management Agency unanimously approved the transfer of a franchise collection agreement, as well as a processing and disposal agreement, to Waste Connections at a Monday meeting. The transaction is expected to close by the end of the year.
• Ron Mittelstaedt, chairman and founder of Waste Connections, spoke on the company’s behalf at the meeting. Bryce Howard will continue as Upper Valley’s general manager. Christy Pestoni, currently chief operating officer, will take on a new government affairs role for Waste Connections.

Dive Insight:

California is expected to remain an active environment for acquisitions in the months ahead as the national trend of longtime family waste businesses selling to larger players continues.

“It is time for a new and stronger partner that will be better poised for California’s future regulatory environment. After the passing of our founder Bob Pestoni last year it became apparent that an acquisition was in the best interest for our family, employees and our community,” said Christy Pestoni in a Oct. 6 letter to UVWMA. “We have chosen [Waste Connections], as our suitor because of their proven commitment to safety, integrity, inclusivity and decentralized management model of staying local.”

Upper Valley traces it roots back to 1959, when Bob Pestoni began collecting food scraps to feed hogs on his family’s farm and recycled the packaging. In 1963, Pestoni and his brother Marvin were awarded the first franchise collection agreement in unincorporated Napa County. In 1966, the two acquired the Clover Flat Landfill — which had been constructed in an effort to consolidate multiple local dump sites. Around this time the company also began composting grape pomace from local vineyards, a relationship that continues today, and grew its operations for to include a range of vertically integrated residential and commercial services.

In addition to disposal capabilities, the Clover Flat site now includes operations to manage compostable material, curbside recyclables and C&D debris. While the landfill was originally projected to close in 2002, the company said its recycling efforts have extended that capacity until 2047. The landfill also has equipment to convert its gas into electricity, which is sold to PG&E.

The terms approved by UVWMA set the expiration of the Upper Valley collection agreement in 2037, with the landfill agreement running until 2047. UVWMA is a joint powers authority that represents Napa County, the cities of Calistoga and St. Helena, and the town of Yountville.

The Clover Flat Landfill has been an ongoing point of contention in the community due to various violations, fires and other issues. While a number of issues have been resolved, the California Sportfishing Protection Alliance recently sued the company in federal court over alleged violations of the Clean Water Act related to stormwater discharge. Waste Connections has been described by local officials as potentially better equipped to manage the site, given its scale, and Mittelstaedt reportedly recognized during the UVWMA meeting that “the landfill is in an environmentally sensitive and challenging area.”

Pestoni’s letter to the agency noted that Waste Connections runs 97 landfills, including nine in California. One of those is the Potrero Hills Landfill in Solano County, which already accepts some waste from Napa County. The letter also outlined how Waste Connections has a sizable presence in California, formerly the company’s headquarter state. Within the past year, it also acquired other notable local haulers such as C&S Waste Solutions and Garden City Sanitation, among others.

Waste Connections previously projected it would close deals worth at least $470 million in annualized revenue this year. Other recent notable transactions by the company include the purchase of Rogue Disposal & Recycling in Oregon and A.J. Blosenski in Pennsylvania.