The provincial government has downgraded the safety rating of the company that collects Toronto household waste west of Yonge St. — largely because of a spate of incidents during the rocky first three months of its contract, city and company officials say.

The downgrade could affect the company’s ability to win other municipal contracts in Toronto and Peel Region. It is fodder for the city workers’ union, which says garbage service is best delivered by the public sector, and for the mayoral campaign of Olivia Chow, who does not want to proceed quickly with garbage outsourcing east of Yonge.

The company’s recent safety performance, however, may be better than the downgrade suggests.

The company, GFL Environmental Inc., was handed a “Conditional” rating, down from “Satisfactory.” Its “overall safety violation rate,” based on a complex formula, stood at 76.2 per cent as of Tuesday — well above the 70 per cent Satisfactory threshold and worse than more than 99 per cent of commercial vehicle operators in the province.

The city’s solid waste chief, Jim Harnum, said government officials are taking the downgrade seriously and are helping to develop a “work plan” for improvement. But he said the downgrade was caused by problems in 2012 that have not persisted.

The violation rate is calculated using two years of data on collisions, convictions and inspections. GFL’s current rating therefore counts the infractions the company committed upon taking over collection service between Yonge St. and the Humber River in August 2012.

According to Harnum, half of GFL’s Ontario-wide violation “points” over the past two years were incurred in that one Toronto district during August, September and October of 2012, when inexperienced new drivers were learning their routes.

When incidents from August and September fall out of the 24-month rolling tally, Harnum said, GFL’s rating will again be “well within” the Satisfactory category.

“If it wasn’t for those two months at the beginning, they wouldn’t be in this situation,” Harnum said.

“We see very few incidents and tickets over the last year, a huge decline. It’s just a slope from the highs of 10 and 12 incidents in those months …and now we’re seeing 0 to 1 incident in a month over the last year.”

Harnum said he could not provide precise monthly violation figures. The company’s Ontario-wide record, available for a $5 fee from the ministry, shows 271 collisions and 71 convictions in the two years since May 2012.

Dave Hewitt, acting president of Canadian Union of Public Employees Local 416, said he does not believe GFL’s problems were “simply a hiccup” or limited to the one Toronto district. He noted that GFL has 700 trucks in the province.

“The GFLs of the world cut corners, and can put public safety at risk,” he said. “Zero-point-six per cent of operators in Ontario have an overall violation rate above 70 per cent. Zero-point-six per cent.”

GFL went to court to request a “stay” of the downgrade until it could ask a judge to review the decision; like other urban vehicle operators, including the city itself, the company argues that the rating system is unfair. Ontario Superior Justice Paul Perell rejected the request on May 1.

Perell wrote that GFL told the court that a downgrade would put the company “in default in its contractual obligations to current municipal clients.” In a testy interview on Tuesday, GFL chief executive Patrick Dovigi claimed Perell’s decision “does not say that.”

Toronto’s agreement with GFL requires the company simply to make every “effort” to maintain a rating of Satisfactory. Harnum and Dovigi said it is doing so.

“At the end of the day, we’re not in violation of any our contracts. We haven’t been fined, nothing. It’s business as usual for us,” Dovigi said.

The outsourcing of the west-of-Yonge district, proposed by Mayor Rob Ford, saved the city $11 million per year. After the poor start, the company has generated fewer complaints in that district than city workers did.

But the downgrade poses a problem for GFL’s efforts to win new contracts. A Peel Region tender this year, Dovigi said, requires the winning bidder to have a Satisfactory rating when it begins its work in 2016.

Toronto might include a similar requirement in its upcoming tender for the Etobicoke district. GFL holds the Etobicoke contract until June 2015, but Harnum has decided not to exercise his option to extend the agreement for an additional two years.

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Harnum cited three reasons: a recent increase in the number of complaints in Etobicoke, partly caused by GFL’s use of older trucks in that area; the need for new trucks to handle the new green bins being introduced next year; and a desire for amended contract terms.

Ford and challenger John Tory want to outsource collection east of Yonge as well. David Soknacki wants to outsource half of that territory. Chow says the city should take a “few years” to assess GFL’s performance.

GFL and the city are both part of a coalition that has asked the province to change the way it calculates the safety rating. The current formula, adopted in 2007, is based the number of kilometres travelled, which makes good ratings harder to achieve for urban operators than for long-haul truckers.

The city’s own overall violation rate is 55.8per cent. If the city’s solid waste department were hypothetically rated on its own, Harnum said, it “would be at risk of being Conditional as well.”

Councillor Gord Perks has tabled a motion to ask city officials to explain what they are doing to respond to the GFL downgrade.