Staff Report: Residential Garbage Collection
Review of options for the continuation of residential garbage and kitchen scraps collection as the current contract expires.
TOWN OF VIEW ROYAL Council Report
TO: Council DATE: May 14, 2014 FROM: John Rosenberg, Director of Engineering MEETING: May 20, 2014
REPORT RESIDENTIAL GARBAGE COLLECTION
RECOMMENDATION:
THAT Council directs staff to soul source a contract with Waste Management
And That staff, negotiate a 5 to 7 year contract maintaining a weekly pickup schedule that includes both garbage and kitchen scraps pick up.
CHIEF ADMINISTRATIVE OFFICER'S COMMENTS:
I concur with the recommendation.
PURPOSE OF REPORT:
To determine the best suited option for the expiring solid waste collection contract.
TIME CRITICAL:
The contract expires on May 31, 2014; although short term extensions are available, a longer term solution is required.
BACKGROUND/DISCUSSION:
The Town's current residential garbage collection contractor, Waste Management, has submitted three options for the continuation of the Town's expiring solid waste collection contract. A discussion involving the benefits and risks to each option is listed below. Alternatives to Waste Management's submissions will also be discussed:
Option #1- Develop a Tender for a new contract for a length of 5 to 7 years.
- The current service has several anomalies that would have to be addressed within a tender.
- Competitive bidding should result in fair price.
- Current Town of View Royal costs are lower (see table below) than all other municipalities, and contractors providing the service to other municipalities are all higher than the Town's current expenditure.
- The Town does not own totes ($300,000 approximate cost to buy new totes) would be an approximate cost of $116 per household.
- Significant risk that costs could be substantially higher than our current rates. Average garbage rate for BC municipalities (that provided information to Civic info annual survey for 2013 pricing) on weekly garbage pickup is approximately $172.75 annually.
- Most recent municipal contract tender (January 2014) in the Greater Victoria area resulted in a 56% increase over one year. Several bids were received the incumbent contractor did not win the tender. All other submissions were significantly higher.
Option #2- Extend the existing contract for a 2 year period
- This option will allow time to perhaps provide clarity to the direction of the CRD's solid waste processing decisions over the next two years.
- Utilizes older truck which would potentially be a less reliable service.
- Town will own the totes at the end of the two year period.
- It only delays the decision concerning how to proceed with longer service term contracts.
Option #3- Single Source a 5 year contract with Waste Management (6 years with a one year bridge)
- Provides price certainty.
- Provides new truck (beginning in year 2) for a reliable service.
- Truck will be Compressed Natural Gas (CNG), the first of its kind on the Island providing municipal garbage service.
- Length of contract allows costs to be spread over several years to keep incremental costs reasonable.
- Town will own totes at end of the contract.
Option #4- Single Source a 7 year contract with Waste Management
- Provides price certainty.
- Provides new truck (beginning in year 2) for a reliable service.
- Truck will be CNG, the first of its kind on the Island providing municipal garbage service.
- Length of contract allows costs to be spread over several years, however the extra length creates pricing risk for Waste Management.
- Town will own totes at end of the contract.
Option #5- Change the level of service to bi-weekly pickup
- Significant change in service philosophy
- Likely result in the lowest increase over the length of the contract
- Typically see a 20 to 30 percent decrease in costs
- Likely require purchase of new totes ($300,000) would be an approximate cost of $116 per household.
| Municipality | Service | Cost 2014 Annually | Garbage Kitchen Scraps | Notes |
|---|---|---|---|---|
| Esquimalt | Bi-Weekly | N/A | Both | Cost breakdown not available, Municipal forces provide service |
| Oak Bay | Bi-Weekly | $212.50 | Both | Municipal provides garbage service, contractor provides Kitchen scraps service |
| Saanich | Bi-Weekly | $155.00 | Both | Municipal forces provide service |
| Sidney | Weekly | $156.00 | Both | Contractor provides the Service new contract in 2014 |
| Victoria | Bi-Weekly | $188.00 | Both | Municipal forces provide service |
| View Royal | Weekly | $149.00 | Both | Contractor provides the Service based on 2014 budget |
| Contractors | ||||
| Alpine | Weekly | $256.56 | Garbage | |
| BFI (estimate entire town) | Weekly | $216.00 | Both | Individual homes would pay $416 annually |
| Neighbourhood | Weekly | $286.00 | Garbage |
BUDGET IMPLICATIONS:
The 2014 draft budget includes a ten percent increase in the residential garbage rate. This allows for all options to be considered. There would be a risk if option #1 was chosen that the tendered price would be higher than the current rate increase.
ALTERNATIVES TO THE RECOMMENDATION:
That Council chooses an option and direct staff to proceed in procuring the preferred option.
RECOMMENDATION:
THAT Council directs staff to soul source a contract with Waste Management
And That staff, negotiate a 5 to 7 year contract maintaining a weekly pickup schedule that includes both garbage and kitchen scraps pick up.
SUBMITTED BY: John Rosenberg, Director of Engineering
REVIEWED BY: Kim Anema, Chief Administrative Officer
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