Memo-12-13-2016-Item-8e

December 13, 2016

MEMO TO:           Mayor Barber and Board of Commissioners

FROM:                  Frank A. Rush, Jr., Town Manager

SUBJECT:           Resolution Authorizing Contract Extension – Waste Industries, Inc. (Dumpster Service)

The attached resolution authorizes the Town Manager to execute a 2-year contract extension with Waste Industries, subject to the same terms and conditions as the current contract.  The Town’s current contract with Waste Industries expires on December 31, 2016, and the attached resolution would extend the contract until December 31, 2018.

The current contract provides for dumpster collection and disposal at residential condominium complexes and Town facilities (businesses in Emerald Isle must contract for their own solid waste services), and includes specified rates per dumpster per collection depending on the size of the dumpster.  The specified rates currently range from $17.54 to $29.89 per dumpster per collection, and include the collection costs and tipping fee costs in the specified fee.  (Total annual costs under the contract are budgeted at $82,000 for FY 16-17.)  These rates are adjusted each year on July 1 according to the change in the Consumer Price Index, and also include a fuel cost adjustment formula.  These terms would remain in effect for the duration of the 2-year contract extension. 

The Board should note that, under this contract, Waste Industries also accepts, sorts, processes, stores, and markets the Town’s co-mingled recyclable materials (collected by and delivered by our contractor, Simmons & Simmons) at its Newport, NC facility at no additional cost to the Town.  The market for recyclables fluctuates frequently, and if the Town did not have this provision in the contract we would likely incur an additional tipping fee of $25 - $50 per ton for the disposal of recyclables, which could equate to as much as $30,000 of additional expense.  We are fortunate that our current contract with Waste Industries includes this provision. 

Waste Industries has provided quality dumpster service for the Town over the past 10 years, and has maintained a positive working relationship with the Town.  Their willingness to accept our recyclables benefits the Town and Simmons & Simmons (shorter transport distances).  Because of these factors, I recommend that the Board approve the attached resolution authorizing a 2-year contract extension.