Agenda - Council - 10/13/2020 - Laserfiche WebLink

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L 2022 IIIEI $3.86 2.93% 2023 -IL $3.98 J 3.11% L 2024 $4.10 —II— 3.02% T 2025 —11— $4.22 —11— 2.93% Attached to this case is a comparison of rates from nearby communities. The comparison outlines what each community's per unit rate is currently. Note though that it's not necessarily an 'apples to apples' comparison, as lot density, square mileage, duration of contract, recycling only or organized collection (garbage and recycling), and other variables impact pricing. As can be seen in the attached table, the 'lifts per mile' does impact the labor cost for the hauler. Fewer 'lifts per mile' results in higher labor costs, as it takes more time to complete a route due to distance between homes. This, in part, makes it challenging to truly compare Ramsey's pricing to that of other communities, even those that also only contract for recycling service. Despite some significant changes in the recycling world over the past 5-10 years, Ramsey's per unit monthly fee has remained constant for over a decade. Over the course of the past decade, there have been some fluctuations to the cost of collecting and processing recyclables. In the early to mid 2010s, there was a significant jump in the price of fuel, which prompted many haulers to approach communities they were contractually servicing to request a per unit fee adjustment. ACE never raised that question with the City of Ramsey and honored the per unit fee in the contract. More recently, there has been significant disruption to the recycling commodities markets resulting from a policy shift by China. Much of the United States' recyclable materials, especially plastics and mixed paper, had historically been shipped overseas to China. However, beginning in 2018, China implemented their National Sword policy that included a ban on importing certain scrap materials and for other materials, an extremely stringent contamination rate (not to exceed 0.5%, which is the equivalent of about 10 pounds of contamination per 1 ton of material). Essentially, this move created significant disruption to the recycling commodities markets, resulting in significant processing fees being applied to haulers at Material Recovery Facilities MRFs). Again, ACE did not approach the City to discuss any sort of per unit fee adjustment. ACE Solid Waste has been providing dependable recycling service for the community for about 30 years. ACE moved their operation to Ramsey in the early 2000s and continues to invest in the community with improvements to their site. Most recently (2019/2020), this included an expansion of their transfer station facility, creating a more efficient operation (now that the Great River Energy Processing Plant is shut down). As part of this expansion, ACE also included a 'convenience center' for residents to drop off additional recyclable materials (e.g. cardboard, newspaper, etc., that doesn't fit in a residents recycling cart). This benefits residents by not having to 'store' excess recyclables nor drive to another community's recycling center. As a reminder, by offering recycling through a contracted service provider, each household is billed for recycling on a quarterly basis through the City. The hauler invoices the City monthly, they do not bill each residence directly for basic recycling service (they may potentially for walk up/drive up service, cleaning of carts, etc.). Each household is billed by the City regardless of whether they choose to participate in the recycling program or not. It is treated as another utility, similar to priority street lights and stormwater management. Alternatives Alternative 1: Approve the proposed Curbside Recycling Contract with ACE Solid Waste as drafted. While the proposed contract does include a per unit price increase, that is not necessarily surprising given that the rate has been flat for 12 years. Additionally, there have been some significant impacts to the recycling industry, mostly as a result of international policy shifts, resulting in greater costs for handling and processing of recyclable materials. Staff does not oppose this alternative. Alternative 2: Approve the proposed Curbside Recycling Contract with ACE Solid Waste for a shorter duration, such as a 5-year contract. Yes, the proposed contract does include a per unit price increase, but that is not necessarily surprising given that the rate has been flat for 12 years. Factoring in the changes in recycling in terms of materials accepted, increased processing fees, and large swings in the commodities markets, the proposed increase