The Jacksonville City Council met today as a “Committee of the Whole” to hear from the Peyton administration on the re-negotiated city landfill contract, and to hear public comments. At stake is a multi-year nearly billion dollar contract to dispose of solid waste in the Trail Ridge landfill … the city’s only operating facility.
Today, the city’s case was made by Ebenezer Gujjarlapudi, director of the city’s Environmental Compliance Department. Mr. Gujjarlpudi made a lengthy presentation of the city’s case to extend the existing contract as negotiated over the past several years, without opening the process to competitive bids.
According to the city, Waste Management was the low bidder on operating the entire Trail Ridge site for the life of the facility … which they contend would mean the entire 944 acre site. Waste Management has built a lot of infrastructure at the site, but it conveyed the actual land back to the city with the contract to operate there. I’ve spoken to at least one former member of the Jacksonville City Council when the original contract was approved who said his feeling was the spirit of the 1992 agreement was for the entire facility, but he could see the ambiguities currently under dispute. The city also contends that extending the contract will save taxpayers $266 million dollars over the life of the contract, including $16 million immediately on a reduction in the current tipping charge. Waste Management has threatened legal action should the city not honor what it (Waste Management) feels is a valid contract by opening it up for bids. No city official will estimate what defending that suit would cost taxpayers.
The city also says Waste Management can fill the space that would exist between the two mounds, extend the life by building higher and maintain all the liability for environmental problems arising from the landfill.
But the thrust of the argument on the part of the city is that they have a low bid, they legally can extend the contract without opening up the process to new bids, and there will be a significant savings to taxpayers by taking that course.
Not so fast, says Republic … the company leading the effort to open the process for bids.
Republic will make it’s official presentation to the Committee of the Whole on April 23rd in a meeting that will begin at 4:00 pm. But several representatives of the company spoke in Public Comments this afternoon.
Tom Ingram, an attorney for Republic, said that company disputes much of the savings the Administration says taxpayers will realize by extending the existing contract, and that he “respectfully disagreed” with General Counsel Rick Mullaney’s assessment that the City Council can waive the purchasing code and not bid the contract. He also insisted, without giving specific numbers, that the deal Waste Management has negotiated with the city can be beaten. Ingram produced an affidavit from the former CEO of Waste Management, now the CEO of Republic, that said his understanding was that the contract would be re-bid at the end of the life of the current mound. It was distributed to the council members.
Later, Republic services manager Andy King said Waste Managements’ profit margin on the current operation is about 40%, and that the industry standard is about 20%. He insisted that Republic could beat the Waste Managements’ negotiated price … and that rather than $10.21/ton, the price should be closer to $8-$9/ton.
We’ll hear more from Republic in two weeks. Council Member Daniel Davis has asked that those giving testimony for Republic be under oath, which the council has the authority to do. Later, Council Member Denise Lee indicated that there have been other instances where the procurement rules have been waived, for instance when the Jaguars were brought to town.
I’ve only scratched the surface of what went on in the chambers today. I hope what I’ve been able to convey is that this issue is far more complex than a soundbite or a t-shirt or a button. I will say that, after listening to the Mayor a week or so ago in one of his endless presentations on this issue, I don’t believe the restated Waste Management contract that is at the center of this debate was crafted “in a smoke filled room”, as some have suggested. I don’t imagine a lot of people paid attention. It’s also fairly obvious that no matter which side “wins”, there will be legal action.
At the end of the day, most of us just want the trash trucks to come around regularly and take the trash away, and as is human nature, we don’t want to pay a lot for that. The Jacksonville City Council seems to have a very difficult decision on their hands. They’ll hear several more hours of testimony on the 23rd, and there could be a vote later that day.
I wish them well, and I imagine I’ll be in the council chamber’s watching.