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Home My WebLink AboutCOW 2006-03-27 Item 5B - Agreement - Unsolicited Solid Waste Proposal with SeaTac Disposal / Allied Waste COUNCIL AGENDA SYNOPSIS O Initials ITEM NO. Q i 4 i t it t 1 Meeting Date 1 Prepared by Mayor'sreview 1/ council review us 3/27/06 1' i rsoa I I, ITEM INFORMATION CAS NUMBER: 06-035 I ORIGINAL AGENDA DATE: MARCH 27, 2006 AGENDA ITEM TITLE Unsolicited Solid Waste Contract Proposal CATEGORY Discussion Motion El Resolution Ordinance Bid Award Public Hearing Other Mtg Date 3/27/06 Mtg Date 4/3/06 Mtg Date Mtg Date Mtg Date Mtg Date 111tg Date SPONSOR Council Mayor Atha Svcs DCD Finance Fire Legal P&R Police ®PFF SPONSOR'S The City's solid waste collection and recycling contract with Sea -Tac Disposal \Allied Waste SUMMARY is scheduled to expire on April 1, 2007. On February 10, 2006, Sea -Tac Disposal submitted an unsolicited proposal to continue providing service to the City beyond April 1, 2007. The proposal contains several key elements that will significantly improve residential, multi- family, and commercial recycling along with customer service while maintaining low rates. REVIEWED BY COW Mtg. CA &P Cmte F &S Cmte Transportation Cmte Utilities Cmte Arts Comm. Parks Comm. Planning Comm. DA LE: 3/21/06 RECOMMENDATIONS: SPONSOR /ADMIN. Forward to COW for discussion and decision. CoNMMITrEE Forward to COW with approval endorsement. COST IMPACT FUND SOURCE EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $0.00 $0.00 $0.00 Fund Source: Comments: MTG. DATE 1 RECORD OF COUNCIL ACTION 3/27/06 4/3/06 1 MTG. DATE ATTACHMENTS 3/27/06 Information Memo dated March 13, 2006 Letter from Allied Waste Services 2005 Garbage and Recycling Service Rates Utilities Committee Minutes from March 21, 2006 (draft) 4/3/06 INFORMATION MEMO To: From: Date: Subject: Mayor Mullet Public Works Directo~ March 13, 2006 Unsolicited Solid Waste Contract Proposal- Sea-Tac Disposal/Allied Waste ISSUE Should the City accept Sea-Tac Disposal's unsolicited solid waste contract proposal? BACKGROUND On March 8, 2001, the City awarded Sea-Tac Disposal a five-year contract to provide residential and commercial solid waste and recycling services for the City. The contract was subsequently extended for two more years. Unless renewed, the contract will expire on April 1, 2007. DISCUSSION On February 10,2006, Sea-Tac Disposal submitted the attached unsolicited proposal. As part of the proposal, Sea- Tac Disposal recommended a five-year contract with automatic one-year renewals subj ect to satisfactory contract perfonnance. In consideration of contract approval, Sea- Tac Disposal agrees to the following tenns: . Rates: Residential and commercial solid waste and recycling rates will not change except for the nonnal annual Consumer Price Index (CPr) rate adjustments. . Residential Recycling: At no cost to residential customers, Sea-Tac Disposal will convert to a fully commingled, single stream system utilizing new 96-gallon wheeled carts with lids. In addition to new containers, the current list of acceptable recyclable materials will be expanded. . Commercial Recycling: Develop, design, and promote an outreach program to increase business recycling. . City/Code Enforcement Clean-ups: Support semi-annual City clean-up events by strategically positioning large drop containers for scrap metal and selected bulky items. To assist code enforcement personnel in their residential clean-up efforts, Sea- Tac Disposal will offer reduced rates for cleaning up wastes and litter. . Customer Service: Provide a more robust and responsive customer service operation that will reduce the amount of time It takes to answer customer telephone calls and ensure accurate dissemination of infonnation. Mayor Mullet Page 2 March 13, 2006 ANALYSIS To assist Council in deciding whether to accept Sea-Tac Disposal's proposal, it is important to ascertain the legality of accepting the proposal without allowing other solid waste haulers to compete for the services and discuss the options that are available to the City for solid waste collection and recycling services. Contracting directly with solid waste haulers is a legally acceptable practice. Currently, there are no statutory requirements for cities to bid solid waste collection and recycling services. Therefore, if Council chooses, it could accept Sea-Tac Disposal's proposal without violatmg contract statutes. If the Council rejects Sea-Tac Disposal's proposal, it must decide on how to handle the City's solid waste collection and recycling requirements. The following options are offered for consideration: . Establish a municipal (in-house) solid waste collection and recycling services utility. This option affords the City a great deal of flexibility in providing a wide range of services to the community. However, tills option is labor intensive and requires significant capital investment and manpower. . Solicit bids/Request for Proposals (RFP) from solid waste collection companies. One of the most important aspects of the bid/RFP process is competition. Theoretically, lower costs are achieved by competing services and other requirements. The disadvantage to using the bidfRFp process to fulfill the City's solid waste collection requirements beyond April 2007 is that there is no guarantee that rates wIll be reduced. In fact, there is some risk that rates on some services may increase. The reason for this is that the City currently has some of the lowest rates in South King County (see attachment). In summary, Council has the legal authority to accept Sea- Tac Disposal's proposal or negotiate any modification to the proposal. Council also has the option to approve a municipal solid waste collection and recycling services utility. Due to capital and other considerations, this is not a viable option in the short term. Finally, with the understanding that rates mayor may not decrease, the bid/RFP option could be pursued. RECOMMENDATION Present to the Utilities Committee for discussion and then fOlWard to the Committee of the Whole. attachment (P,alice\Unso1iciled Solid Was<< Coottaet Proposa!) ~~~ ALLlID WASTI I!RVIClS February 10, 2006 Mr. Jim Morrow Public Works Director City of Tukwila 6200 Southcenter Blvd. Tukwila, WA. 98188 Dear Mr. Morrow: We would like to propose several concepts for an extension to our current contract with the City of Tukwila that will enable us to continue and strengthen our excellent relationship with the City and our customers. As you know our Tukwila residential customers already enjoy very favorable rates in comparison with other south King County cities. To further enhance the service levels for those residential customers we propose the following service concepts which we feel will meet your concerns about recycling and abatement of unsightly litter. A. Conversion of the current recycling system from 32 gallon containers and glass bin to a fully commingled single stream system utilizing new 96 gallon wheeled carts with lids. This system offers a huge improvement in capacity and convenience for our customers and has been very successful in other cities in actually increasing recycling participation and increasing recycling tonnage. We will convert to this system on a schedule to be agreed upon between you and our operations managers. In fact, we envision implementing this new system prior to the termination of our current contract (April 2007) if agreement on an extension can be reached sometime soon. B. Addition of more materials to the recycling stream. Coinciding with the delivery of the new recycle carts we will notify customers that additional materials can be added to the current list of acceptable items. We will work with Rebecca Fox, your Recycling Coordinator, in developing an educational means of rolling out the information to customers. Some suggested materials that could be added include additional plastics, small appliances and e-waste. Our MRF manager will work closely with you and Rebecca to evaluate what additional materials can be added to the commingled recycle stream. 22010 76th Ave S Kent WA 98032 253.872.7220 I FAX 253.239.8859 www disposal.com ~~~ ALLIID WASTI nRVICIS Based on discussions with you and your staff we realize that code enforcement is a priority for the City. Therefore we will offer the fOllowing two services to promote your code enforcement efforts: C. Semi-annual special clean-up event for scrap metal. Large drop boxes will be placed at central locations in the City so that residents can bring discarded scrap items to the clean-up site. To the extent possible the scrap metal will be recycled. D. Discounted rates for code enforcement clean-ups. In residential areas designated by you we wil! provide reduced rates for cleaning up abandoned wastes and litter. . For our commercial customers we propose an intensified effort in increasing recycling so as to reduce garbage collection fees and increase recycle tonnages. We will concentrate on working especially with smaller businesses which may not have the manpower or financial resources to initiate their own recycle programs. We will perform annual waste audits for our larger commercial accounts and perform other audits as requested. We will again work with Rebecca Fox in developing, designing, and promoting this out-reach program. Implementation of these enhanced services will require a significant financial and manpower investment on our part. Therefore we would ask for a long-term contract commitment on your part. Our minimum requirement to depreciate the investment in the new commingled recycle program, for example, is five years. A scenario which has worked very well in other communities is a five year contract with automatic one year renewal rollovers at the end of each year subject to us meeting performance standards. There are many benefits relating to a company's ability to continually reinvest in equipment and community programs. We'd like to discuss this concept with you more in the near future. We should also take this opportunity to advise you of improvements we are making in our Customer Service Department that will enable us to respond more quickly and accurately to our customer phone calls. One of my top priorities is improving our call management by designing a customer driven system. I have recently hired a new customer service manager and together we have completely restructured the department. In addition to the new manager we now have two working supervisors whose primary tasks are on-going monitoring of in-coming customer calls to insure prompt response and to insure dissemination of accurate information. We have installed automatic measurement techniques that will enable us, for example, to know on a daily basis the amount of time it takes for a customer's call to get answered, the number of calls on hold at any given time, etc. With these changes in place I expect a huge improvement in our ability to respond to our Tukwila customers. 2201 0 76th Ave S Kent, WA 98032 253.872.7220/ FAX 253.239.8859 www disposal.com -~ ALLIID WASTI SlRVIClS We look forward to meeting with you to discuss the contract extension and to refine these suggested contract enhancements. We are also certainly willing to consider service enhancements other than those we have described. Please feel free to contact me at 206-652-8831. cc: Mayor Steve Mullett 22010 76th Ave S Kent. W A 98032 253.872.7220/ FAX 253.239 8859 www.disposal.com GARBAGE AND RECYCLING SERVICE RATES 2005 Tukwila Auburn Kent SeaTac Des Moines 20 Gal 11.17 774 11.19 11.31 12.12 1 Can 13.37 10.83 14.37 1477 15.26 2 Cans 18.14 \21.72 1982 20.06 20.49 60 Gal Cart 19.22 21.72 20.53 21.44 21.89 90 Gal Cart 26.21 30.27 29.09 29.30 30.11 Utilities Committee March 21,2006 OR4J:r Present: Jim Haggerton, Chair; Pam Linder, Verna Griffm Jim Morrow, Frank Iriarte, Gail Labanara, Chuck Parrish Nels Johnson, Chris Guimond, Mike Huycke from Allied Waste Unsolicited Solid Waste Contract Proposal The current contract with Sea-Tac Disposal/Allied Waste expires April 1, 2007. Sea-Tac Disposal has submitted a five-year contract with five key elements. The rates would remain one of lowest in South King County. The main changes would be utilizing the 96-gallon recycling carts and Sea- Tac Disposal would assist with two clean-up events for bulky items. Pam L would like apartments included in the commercial recycling outreach program and Jim H would like a timeline included for that program. Frank reported that the customer service has improved With the new manager and additional training. Discussed the possibility of a policy change to mandatory garbage pickup and consider it a separate issue. A clause could be included in the contract to reopen it if there were changes. Frank reported with mandatory pickup, those people without pickup now would more than likely sign up for the smallest container. Sea-Tac Disposal reported that mandatory pickup would more than likely not change the rate structure. Jim H did ask if it would be possible for the City to establish our own garbage utility and was told it would be a very significant capital investment. Committee was informed that Sea- Tac Disposal does have an on-call service for large items at a special fee. Pam L wanted to know what those on-call fees were and that the information should be included for COW and the Hazelnut. Unanimous recommendation to send proposal to COW and Ree:ular meetine: for discussion and seriously consider approvine: proposal. B. 2006 Solid Waste/Recvclin2 Rates The rates are only increasing by 2.8% and will be effective April 1, 2006. The information will be included in monthly bills and the April Hazelnut. Information Only. Other Jim M invited Committee to the Allentown/Foster Pt Open House on April 27, 2006. Jim H informed Committee on his trip to DC and the proposed Telecom legislation. He reported that the telecom lobbyists have increased from 161 to 200. Jim H indicated that he received conflicting information in DC regarding collection of franchise fees in our state. Frank reiterated that the City can only collect franchise fees on Comcast's cable service, not high-speed cable modems. Jim H. requested a point paper on all of the City's franchises and what exactly is legal in the State of Washington. Return item to Committee with informational point paper. Committee Chair Approval Minutes by GL, reviewed by FI, 1M C:\Documents and Settings\GaiI\My Documents\ WINWORD\UC Minutes 3-21-06.doc