Allied Waste Services of Santa Barbara has served the South Coast since 1972, but it suffered historic losses Tuesday when the Santa Barbara County Board of Supervisors awarded an eight-year contract to locally owned hauler MarBorg Industries.

Two of the company’s three South Coast trash contracts were lost Tuesday. As a result, Allied officials say they’ll have to lay off nearly a third of its local workforce.

Allied Waste Services now will cover only the portion of Santa Barbara west of State Street, and that contract expires in 2013.

County supervisors voted 4-0 to approve the contract with MarBorg, with 2nd District Supervisor Janet Wolf absent.

The county is divided into five trash-hauling zones, and supervisors have said that a minimum of two companies must be working countywide. They revised the county’s solid-waste ordinance last year to provide for no fewer than two haulers, a move they said would encourage competition.

The area known as Zone 2 covers the unincorporated eastern Goleta Valley, north of Highway 101. Currently, the eight-year contract costs the county about $16 million. Zone 4 represents a $30 million contract, and Zone 5 costs $35 million. Combined, the service contracts are among the largest the county deals with, Mark Schleich, deputy director of the county Public Works Department, told Noozhawk last month.

The supervisors directed staff in 2009 to look at options for Zones 2, 4 and 5. Contracts in all three zones will expire in June.

Ultimately, the staff put the zones out to bid to Allied Waste Services of Santa Barbara, MarBorg Industries and Waste Management. The companies came back with 11 proposals, but staff said MarBorg scored the highest for Zone 2, and Waste Management for Zones 4 and 5. Rates are expected to decrease by a minimum of 10 percent, although the actual rates will be determined later this spring.

While Allied brought in the lowest bid in Zone 2, county staff rated MarBorg higher in quality of service and diversion. The bids brought in a lot of perks to the consumer, too, according to Leslie Wells, program leader of the county’s Resource Recovery & Waste Management Division.

“We’re seeing a lot of enhancements on the service side,” Wells said.

Among the perks were picking up bulky items curbside twice a year instead of once.

Other jurisdictions will be watching the county’s move Tuesday. The Santa Barbara City Council voted last week to postpone its decision to hire a trash consultant until after the county supervisors voted on their process.

The city is expected to hold a competitive bidding process for the $8 million-per-year contract, said Stephen MacIntosh, general manager of Allied Services and the city’s former environmental services director.

MacIntosh held a news conference Tuesday morning and said the decisions by the city of Goleta and the county to pass on Allied’s services will make services more costly for ratepayers. He stressed the same points when he addressed county supervisors later in the day.

About 30 speakers went forward Tuesday, evenly split between MarBorg and Allied. Even the room was divided, with MarBorg president Mario Borgatello and supporters and family on one side, and MacIntosh and Allied Waste employees on the other.

Supporters of Allied listed benefits such as increased competition, and MarBorg supporters encouraged the board to give the contract to a locally owned company. MacIntosh’s supporters scoffed when supervisors chose not to give him more time at the microphone. He originally asked for nine minutes to speak, but the board said he would have to make the case in two.

“Businesses do not survive that long if they don’t do their jobs well,” he told supervisors.

He lauded the county for its process while taking a stab at nearby Goleta, which decided not to put the contract out to multiple bidders. By awarding the contract to MarBorg, “you will be creating a monopoly,” he cautioned supervisors.

Borgatello said he and his team would fulfill the duties outlined in the county’s agreement.

“Solid waste contracts need to be viewed with the broadest perspective possible,” he said. “We’ve stepped up to the plate.”

The item was approved with little discussion among the supervisors.

First District Supervisor Salud Carbajal said he hoped MarBorg would consider hiring any qualified employees from Allied who might be displaced.

After the meeting, MacIntosh called the decision “extremely disappointing. We know we had a superior proposal.” He said not only was Allied’s proposal the least expensive option, but it would have created more diversion for the county, prolonging the life of the Tajiguas Landfill west of Goleta.

MacIntosh said the loss of the Zone 2 contract would amount to about 20 employee layoffs, a third of Allied’s local workforce. He also expressed chagrin that supervisors had not waited until the next week to take Wolf’s vote, as she had requested.

Borgatello said he thought the process had been very fair. When asked whether he would consider hiring some of Allied’s workers, he said the company would be open to new hires. It will be implementing more automated systems in the routes, at the request of the county, but Borgatello said his company would hire as many employees as possible.

“Our long history of performance is what paid off in the end,” he told Noozhawk.

Noozhawk staff writer Lara Cooper can be reached at Noozhawk staff writer Giana Magnoli contributed to this report. Follow Noozhawk on Twitter: @noozhawk or @NoozhawkNews. Become a fan of Noozhawk on Facebook.

— Noozhawk staff writer Lara Cooper can be reached at Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.