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Home My WebLink About15.F.1. Solid Waste/Recycling Contract Renewal /5.F L CITY OF SHAKOPEE ~ · aft, \t.t Memorandum TO: Mayor and City Council "lit PROM: Mark McNeill, City Administrator SUBJECT: Solid WastelRecycling Contract Renewal ______.____m__O_____ .____. _.________~_._w.~-- .._. DATE: Apri114,2005 INTRODUCTION: At the meeting of April 19t\ the Council will be asked to direct staffto negotiate a renewal ofthe garbage/recycling contract with Dick's Sanitation. The current contract expires March 17,2006. BACKGROUND: Attached is a memorandum from former to the Assistant to the City Administrator Tracy Schaefer. Earlier this year, the Council authorized Ms. Schaefer to act as a consultant to assist the City in garbage franchise renewal discussions. As shown, the recommendation is to not seek Request for Proposals, instead to negotiate directly with Dick's for a renewal. From the calls that are received at City Hall over the past 4 years that this contract has been in place, the service levels provided by Dick's are seen as being excellent; we also believe that favorable renewal rates can be negotiated. Renewal also eliminates the formidable task ofthe changeover of containers from the existing company to a new one. Council should be aware that there is no legal obligation to seek competitive bids, or even proposals for renewals of contracts such as this, as they are termed "professional services". This would not be the case ifthere was a change contemplated to expand the scope of services, such as requiring apartment units or others not currently provided under the contract, to go with the City's organized system. But this is not the case. RECOMMENDATION: We recommend that negotiations be directed to renew the existing contract, and that this be brought back for consideration by Council at the May 3rd meeting. ACTION REQUIRED: If the Council concurs, it should, by motion, direct staff to negotiate a renewal for a five year contract with Dick's Sanitation for garbage and recycling services to the eligible residents of Shakopee, for consideration at the May 3rd City Council meeting. t~~ ~~llicU Mark McNeill City Administrator MM:th IS, F. I. City of Shakopee Memorandum TO: Mayor, City Council Mark McNeill, City Administrator FROM: Tracy Schaefer, Bradley & Guzzetta, LLC SUBJECT: Refuse/Recycling Contract Renewal MEETING DATE: April 19, 2005 Introduction City Council is asked to review its refuse options for residential refuse services, and give direction as to negotiating the renewal of the existing contract with Dick's Sanitation. Background Shakopee's contract with Dick's Sanitation for refuse/recycling/yard waste, "refuse," services and the contract for refuse processing services with Hennepin County expire on March 17,2006. Currently, Shakopee's contract includes all single family dwelling units (single family, town homes and up to four unit apartments) located within the MUSA area. Shakopee's residents have been serviced by an organized, or "closed" system for over thirty years. With the contracts expiring, the City Council has the opportunity to evaluate its residential refuse options: 1. Renew the refuse contract with Dick's Sanitation and maintain the current organized refuse collection system. 2. Issue RFPs to other qualified refuse haulers to maintain the organized collection system. 3. Allow the contracts to expire and open refuse collection up to the non-organized, "open," system. An organized system is when the City contracts with a hauler for refuse services; a non- organized system is when the residents must make their own arrangements for refuse disposal. Advantages and disadvantages are present in both the organized and non-organized systems. Organized hauling provides: . Economies of scale (the more customers served by one company the better price and services offered), . Elimination of multiple trucks throughout the week in residential neighborhoods (enhancing public safety, reduced wear and tear on city streets, minimization of truck noise and reduction of litter), 1 . Guarantees that all served residents will be provided with a legal refuse option, insuring waste is processed before becoming landfill ed, negating liability concerns for the City, . Uniform refuse pickup, including a streamlined complaint service, including penalty provisions, via the refuse contract and City Hall. Although the organized system has several advantages, its main disadvantage is the lack of customer choice. This was more of an issue ten years ago before the large refuse haulers began merging/acquiring the small local haulers, which has reduced residents' choices and competition. Non-organized hauling allows each resident to choose any licensed hauler. If the industry changes, and increases the number of local haulers, there may be more competition between haulers. Although the disorganized system allows "resident selection:" . The City is unable to assist residents with complaints, . The hauler determines where the waste will go, . There will be increased daily truck traffic, noise, air contaminants and litter, . There will be an increased need for road repair, . There is potential for some residents not to hire a refuse hauling service, resulting in increased l;lccumulated, abandoned or illegal dumping of refuse. That will require increased enforcement costs for the City to ensure safety and compliance with City ordinances and public safety. Organized v. Disorganized Recommendation It is recommended that the City continue with the organized refuse system, due to the City benefits. outlined above. Renew Dick's Contract v. RFPs If the Council concurs with the recommendation to continue the organized system, the Council must decide if it wants to renew its existing contract with Dick's Sanitation, or solicit Requests for Proposals (RFPs) from other haulers to provide residential refuse services. In 2000, the City Council issued RFPs for refuse services- the City had not solicited proposals in the more than thirty years that the City had the organized system. More importantly, there was an apparent dissatisfaction with the hauler at that time,. A citywide refuse survey reinforced that the majority of Shakopee's residents were also not pleased with the then-hauler. Customer complaint calls had been tracked by city staff, and it indicated three -five complaint calls a week at that time. After tracking Dick's Sanitation customer complaints over the past four years, customer complaints have virtually been eliminated. If City Council chose to renew with Dick's Sanitation, it would continue with the existing provisions of the contract. Those provisions are listed on Attachment A. 2 Processing In addition to the refuse contract with a refuse provider, the City also entered into a processing agreement with Hennepin County's processing facility to ensure the refuse was being properly disposed of and to take advantage of the State's processing rebate program. Although the current contract is with Hennepin County, NRG, located in Scott County just south of Shakopee on 169, is also now able to accept and process Shakopee' s refuse utilizing a newer more environmentally friendly technology. Both NRG and Hennepin County are interested in processing Shakopee's refuse for the next five years. The City Council should direct staff and consultant, Bradley & Guzzetta, LLC, to bring back terms and conditions and pricing for both Hennepin County and NRG to process Shakopee's refuse at the Council at its May 3 City Council meeting. The contract would run concurrently with the refuse service agreement. Recommendation It is recommended that the City Council direct staff and the consultant, Bradley & Guzzetta, LLC to a) negotiate a new five-year refuse agreement with Dick's Sanitation, b) request $25,000 for recycling bins and $5,000 for environmental awareness from Scott County's SCORE CARD fund and c) negotiate the terms and conditions and pricing with both Hennepin County and NRG for a processing agreement before the May 3rd City Council meeting. Action Requested Direct the City's staff and consultant, Bradley and Guzzetta, LLC to a) negotiate a new five-year refuse agreement with Dick's Sanitation; b) request $25,000 for recycling bins and $5,000 for environmental awareness from Scott County's SCORE CARD fund; and c) negotiate the terms and conditions and pricing with both Hennepin County and NRG for a processing agreement before the May 3rd City Council meeting. 3 Attachment A 1. The City negotiates the terms and conditions, including price and any new terms with Dick's Sanitation. 2. The City's consultant and staff would work with Dick's to negotiate lower refuse rates than the current 2005 rates. When current 2005 rates are compared in the Metro Area, Shakopee's rates are lower than the Twin Cities average (see attached Residential Refuse & Recycling Rate Comparison Study), 3. Dick's would continue the 30, 60 and 90-gallon refuse containers. This gives residents pricing options, promotes recycling and gives seniors and residents on fixed incomes a lower cost option, 4. Dick's would continue the specified day for bulk pick for a fee for electronics, computers and other bulk items (see attached 2005 Bulk Rate Pricing Guide), 5. Dick's would continue the yard waste program where residents can use bags/containers or the seasonal Dick's container and be billed quarterly, 6. Dick's would continue the valet service for a small fee. Dick's currently provides this service to handicap residents and some seniors, free-of-charge, 7. Dick's would continue the snow bird policy for residents who head South in the winter, 8. Dick's would continue the free automatic deposit/payment plan, 9. City Council should continue the fine structure for poor customer service to give City leverage, incase any service problems arose. Due to superior customer service, city staff has received virtually no customer complaints and has never had to draw on the fine escrow money, 10. Shakopee would continue to receive an alley credit of$I,860/year to apply towards Clean Up Day, II. Dick's would continue to provide free all refuse services to all City buildings, 12. Dick's would continue to provide the free residential cardboard dumpster drop off program located at the Public Works building, which was added, at no additional charge, after the 2000 contract was signed, 13. There would be no additional cost or staffing impacts to the City to renew the contract, 14. Dick's would continue the recycling rebate program. In 2005, Shakopee has already received over $2,000 to apply towards Clean Up Day, 15. Shakopee would continue to receive processing rebate funds from the State's SCORE CARD grants fund, contingent upon Sate funding. In 2004, each resident received a $2.51 recycling rebate, 16. B&G would recommend that the City request that an on-line bill payment program be implemented free of charge for Shakopee residents, 17. B&G would recommend that the City request a $25,000 grant from Scott County's SCORE CARD funds to purchase additional recycling containers to continue to promote increased recycling and keep monthly rates low. Currently, the City provides free additional recycling containers, 18. B&G would recommend that the City request a $5,000 grant from Scott County's SCORE CARD funds to continue environmental awareness through the City's newsletter, website and video production. 4 Residential Refuse & Recycling Rate Comparison Study.; 2005 Shakopee's current rates w/processing 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 8.87 $ 10.98 $ 12.62 Tax Exempt Services $ 3.80 $ 4.71 $ 5.41 $ 12.67 $ 15.69 $ 18.03 Hastings 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 8.93 $ 10.63 $ 12.03 Tax Exempt Services $ 3.30 $ 3.30 $ 3.30 $ 12.23 $ 13.93 $ 15.33 Wayzata 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 7.49 $ 11.70 $ 15.91 Tax Exempt Services $ 3.60 $ 3.60 $ 3.60 $ 11.09 $ 15.30 $ 19.51 White Bear Lake 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 9.50 $ 13.00 $ 17.00 Tax Exempt Services $ 2.70 $ 2.70 $ 2.70 $ 12.20 $ 15.70 $ 19.70 Farmington 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 10.95 $ 13.95 $ 16.95 Tax Exempt Services $ 3.05 $ 3.05 $ 3.05 $ 14.00 $ 17.00 $ 20.00 Average residential rates over 6 cities in the metro area: 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 10.25 $ 14.26 $ 17.46 Tax Exempt Services $ 3.27 $ 3.36 $ 3.30 $ 13.52 $ 17.62 $ 20.76 OVERALL AVERAGE RATE'S OVER 10 C/l1E'S IN THE METRO ARb"/i-;' From survey: Average monthly rates 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 9.42 $ - $ 12.71 $ - $ 15.87 Tax Exempt Services $ 3.18 $ - $ 3.20 $ - $ 3.19 $ 12.61 $ 15.91 $ 19.06 Shakopee 30 Gallon 60 Gallon 90 Gallon Taxable Services $ 8.87 $ 10.98 $ 12.62 Tax Exempt Services $ 3.80 $ 4.71 $ 5.41 $ 12.67 $ 15.69 $ 18.03 Data Collection Information *Bumsville, Eagan, Lakeville, Wayzata, White Bear Lake, Hastings, Farmington, Bloomington, Above information was taken from compiling current city contracts similar to Shakopee. All refuse levels of services are exact in comparison. All information from city contracts was compiled from public information. All private hauler information was based on surveys of current rates and levels of service from existing or established customers. All rates include recycling - but do not include state and county taxes. Yard waste was not included. Extras/bulk items charges for the City of Shakopee Description of item( s) Rate/unit Extra bag or can oftrash (30 gal. equivalent).......... $ 2.50 per bag or can Loose misc. trash (per yard unit $)........................... $ 15.00 per cubic yard Extra bag or can of yard waste (30 gal. equivalent).. $ 1.50 per bag or can Seasonal yardwaste program.................................... $ 54.50 per year Valet or doors ide service........................................... $ 17.50 per month extra Additional 60 gallon cart............................................ $ 10.50 per month extra Christmas tree.... ......................... .................. ............ $ 4.50 per tree Appliances (alllargeL............................................... $ 45.00 per item Basketball hoop and backboard................................ $ 50.00 per item Bathtub (cast iron)..................................................... $ 100.00 per item Bathtub (fiberglass/plastic ).................. ...................... $ 50.00 per item Bed frame.................................................................. $ 7.00 per item Bike............................................................................ $ 6.00 per item Box spring or mattress............................................... $ 28.00 per item Car seat......... ......... ..................... ............. .................. $ 10.00 veritem Crib mattress.... ............ .......... .......... .................... ...... $ 7.50 per item Christmas tree (no tinsel or tree bags please)........... $ 4.00 per tree Desk (roll-top). .................. ........ .................. ........ ........ $ 24.00 ver item Desk (steel or wood).................................................. $ 15.00 peritem Door & frame.............................................................. $ 12.00 per item Dresser.... ................. ........................ .... ...... ...... .... ...... $ 15.00 per item Entertainment center (full wall unit)............................ $ 55.00 per item Entertainment center (small unit)............................... $ 25.00 per item Futon. ...... .,. .......... ............ ..... ............ ... ....... ...... .... ..... $ 22.00 per item Garage door opener................................................... $ 15.00 per item Garage door (aluminum)............................................ $ 40.00 per item Garage door (wood or steel)...................................... $ 75.00 per item Grill without propane tank.......................................... $ 20.00 per item Headboard...... ......... ............................. ...... ............ ... $ 15.00 per item Hide-a-bed.. ... .................... ........ ........ ... ....... ........ ...... $ 35.00 per item King chair................................................................... $ 6.50 per item Laundrv tub....... ..... ........ ........................... ...... ........... $ 10.00 per item Lawn mower (push) must be empty offuel/oil........... $ 16.00 per item Lawn mower (rider) must be empty offuel/oil............ $ 65.00 per item Loveseat.... ................... ... ........ .... .......... ... .................. $ 25.00 per item Mattress.. .... ................. ....... ........ ........ ......... ............... $ 28.00 per item Ottoman...................................................................... $ 10.00 per item Pallet (wood)... ..... ........... ............................. .... ........... $ 6.00 per item Patio door (atrium or sliding glass door)..................... $ 65.00 per item Picnic or patio table..................................................... $ 20.00 per item Ping Pong table........................................................... $ 22.00 per item Recliner........ ..... ........ ............... ..... ..... ............ ...... ....... $ 15.00 per item Screen door ................................................................ $ 5.00 per item Sectional couch.............. ........................... .................. $ 40.00 per item Shower door............. ................................................ .., $ 25.00 per item Sink.............................................................................. $ 12.00 per item Snow blower................................................................ $ 45.00 per item Swing set (aluminum).................................................. $ 15.00 per item Swing set (treated wood)............................................ $ 45.00 per item Table (large) dinette................................................... $ 10.00 per item Table (small) card type............................................... $ 5.00 per item Tire with rim................................................................ $ 15.00 per item Tire without rim........................................................... $ 8.00 per item Toilet.......................................................................... . $ 12.00 per item T. V. Stand............. .................. .......... .............. ..... ....... $ 4.00 per item Vacuum Cleaner......................................................... $ 5.00 per item Vanity......................................................................... $ 18.00 per item Water softner.... .... ......... ...... ....... .... ........ ........ .... ........ $ 35.00 per item Waterbed mattress (empty)........................................ $ 18.00 peritem Rates do not includes MN sales tax. Televisions (depending on the size).. .. ... .. .. .. .... .. .. .. ... . $ 25.00/$150.00.45 per pound Electronics (per piece)............................................... $ .45 per pound