As New York City debates a ban on foam containers, suppliers pitch an alternative.

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To many coffee shops, take-out joints and supermarkets, plastic foam is a blessing. Light, insulating and cheap, it keeps coffee hot, shrimp rolls crispy and eggs intact.

To the Bloomberg administration, environmentalists and recyclers, it's a nightmare. Difficult to recycle and potentially toxic, it dirties the city, costs taxpayers money and sits in landfills for centuries.

The two views are coming to a head as the City Council decides whether to ban plastic-foam food containers or add the material, called expanded polystyrene, to the curbside recycling program. The mayor's office wants a ban passed before Bill de Blasio takes over Jan. 1.

Foam makers have been fighting the ban since Mayor Michael Bloomberg proposed it in February. Michael Westerfield, corporate director of recycling programs for Michigan-based Dart Container, one of the largest makers of foam cups, has spent much of the past nine months here meeting with sanitation officials, the mayor himself, council members, lobbyists and the city's plastics-and-metal vendor, Sims Metal Management.

If city trucks would collect plastic foam from residents and Sims would separate it, Westerfield pledged, Dart would purchase equipment to wash and dry it and then buy it for $160 per ton for five years, nearly twice what the city pays to put it in landfills, replacing a $2 million municipal expense with a $4 million revenue stream.

With about half of Dart's $3.5 billion in annual sales coming from expanded polystyrene, and the prospect of other cities copying a New York ban, the company has good reason to subsidize such a program. "If this fails, you know what it does to us as a company?" Westerfield asked. "It kills us."

Dozens of municipalities recycle plastic foam, and about 70 have bans, but the choice in New York is complicated. The Brooklyn facility that Sims will open next month to automatically sort metal, plastics and juice boxes won't be able to cull plastic foam contaminated by food and drink—so-called dirty foam.

Absent that step, recycling the foam is impossible; hence, Dart's offer to wash it. The company, founded in Michigan in 1937 and now with plants around the world, has two that wash used cups.

Jerry Powell, executive editor of Resource Recycling Magazine, said that Dart's foam-recovery program would be the largest ever attempted in the U.S., that its washing technology is fairly new and untested at such volumes and that foam particles would make a mess at Sims' plant.

'Itty, bitty pieces'

Brooklyn Councilman Lew Fidler, the prime sponsor of the bill to enact the mayor's ban, agreed. "If it could be recycled, everyone's for that," Mr. Fidler explained. "The problem is, I don't think it can be. A Styrofoam cup thrown into a recycling truck—how many itty, bitty pieces is it going to end up in? How can you wash those itty, bitty pieces?"

Foam makers say their containers hold up well, and Tom Outerbridge, general manager at Sims, concurred, but cited a caveat.

"If you get the packaging that comes with a stereo, it comes apart into a thousand little beads," Outerbridge said. "I wouldn't be worried about that coming from cups and trays. But [foam] peanuts will go all over the place, and Styrofoam packaging would get busted up in our machinery and be floating around everywhere like confetti."

Still, Manhattan Councilman Robert Jackson, who has introduced a bill with Brooklyn Councilwoman Diana Reyna to add plastic foam to the city's curbside recycling program, said it's worth a try.

"Here's a company saying, 'We will recycle it; we will pay you $160 a ton,' " Jackson said. "It will get it out of the waste stream, and the city will earn several million dollars. Hello? That sounds like a great win to me for the city of New York."

Westerfield said Dart's proposal would solve another problem. To add weight, the foam would be baled with the rigid No. 6 plastic used for things like aspirin bottles and CD cases. The city added that to its recycling program last spring, but Sims mostly sends it to landfills because it's currently worthless.

Dart would truck the baled material to Indianapolis-based Plastic Recycling, which would process it for use in picture frames and tape dispensers. The company's marketing manager, Brandon Shaw, flew to New York last week to assure skeptics that he could sell every ounce of the city's foam—if it's clean.

Manufacturers have also trotted out restaurateurs to praise the quality and price of foam. The savings over cardboard and coated paper is a penny per cup and a few cents per container. "Every dollar counts," said Astrid Portillo, proprietor of Mi Pequeño El Salvador in Jackson Heights, Queens. No customer in 20 years has complained about foam, she added. A Quinnipiac poll found New Yorkers favor a ban, 69 percent to 26 percent.

Deputy Sanitation Commissioner Ron Gonen, who crafted the Bloomberg plan, said cost-competitive substitutes exist for everything in the ban, which would take effect in July 2015. His pursuit of polystyrene was likened to Captain Ahab's quest for Moby Dick by Westerfield, who noted that many alternative products are lined with non-recyclable material and go to landfills. Dart makes some of them.

The fight will spill into public view at a Nov. 25 hearing. Fidler said the next mayor could postpone the ban if foam recycling becomes practical. But the industry's prospects look bleak. A few years ago, an ambitious councilman pushed to ban foam trays from public schools. His name was Bill de Blasio.

A version of this article appears in the November 25, 2013, print issue of Crain's New York Business as "A drastic plan for plastic".