Waste City

First oil, then breast implants, and now coffee grounds and orange peels: Welcome to Houston, garbage capital of the universe.

Cans overflowing with rotting orange peels and smelly coffee grounds sat uncollected for days, and the residents of the Willowbrook subdivision in southwest Houston were none too happy. At a neighborhood meeting they complained long and loud about their garbage pickup. Tom Fatjo, Jr., an accountant who was the president of the civic association, quietly proposed that they pool their money and buy a garbage truck. His idea was promptly trashed. “This obnoxious guy said, ‘Why don’t you be our garbage man?’” Fatjo recalls. “The thought intrigued me. So I did.” Within weeks of that meeting in the summer of 1966, Fatjo spent $7,000 on a used Chevy truck fitted with a Pakmor compactor. He talked his father into helping him, and together they began collecting trash for Willowbrook and a couple of nearby subdivisions. The first day was nightmarish: It took three times longer to complete the route than they had estimated.

An affable, balding man known for his salesmanship, Fatjo laughs while telling the story. In fact, he’s laughing all the way to the bank: That one truck 33 years ago ignited a trash revolution. Fatjo quickly saw an opportunity to combine lots of small companies into a giant conglomerate, and two years later he realized that dream in the form of Browning-Ferris Industries ( BFI). Along the way, he helped turn Houston—once known for oil and space shots and more recently breast implants and computers—into Waste City, the center of the garbage universe. Waste Management, Inc., the world’s largest trash collection and disposal company, is based there. So is U S Liquids, North America’s largest consolidator of liquid-waste services. So is Synagro Technologies, which also handles liquid waste. So are the remnants of BFI, formerly the nation’s second-largest waste hauler, which is in the process of being acquired by Allied Waste of Scottsdale, Arizona, in a deal valued at $9.1 billion.

Why is Houston, as it were, at the top of the garbage heap? “It has been an incubator of talent and expertise, from law firms to accounting firms,” says Ross Patten, Synagro’s chairman and CEO. Roger Ramsey, the former chairman of Allied, says the city has at least three

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