Agenda - Council Work Session - 11/10/2020

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CC Work Session 2. 1. Meeting Date: 11 / 10/2020 Information Title: Discuss Resolution #20-225 for New Curbside Recycling Contract with ACE Solid Waste, Inc. Purpose/Background: The purpose of this case is to continue the conversation from the October 13, 2020 City Council meeting related to the curbside recycling contract with ACE Solid Waste, Inc. During the City Council meeting on October 13, 2020, City Council was concerned about the automatic step increases built into the contract starting on the first of each year. Since the previous City Council meeting, Staff has reached out to neighboring and comparable communities to see if their contracts include an automatic annual increase. Staff also reached out to Anoka, who recently finished an RFP process, to see if all proposals include an automatic annual increase. Staff has also reached out to ACE Solid Waste, Inc. for additional information. Automatic Annual Increase/Escalators Attached is a document outlining a comparison of rates for comparable and/or adjacent communities. Staff would like to note that Ramsey is a unique City that does not see some of the efficiencies of other Cities of our size as we are a large (acreage) City with a significant number of single family homes. Many comparable communities see cost savings related to the number of apartment buildings that allow for centralized pickup (one large dumpster for 300 units, compared to 300 individual homes in Ramsey). Ramsey's unique rural character, sheer acreage of City size, and large City lots provides a unique challenge related to garbage hauling. The City of Anoka shared that their previous contract (a 5 year contract that was extended 2 years) included an escalation scale, and all proposals in their recent RFP (that ended October 16, 2020) included an escalation scale as their RFP directed. They directed proposals to not include an annual increase of more than 3%. They hope to sign a new contract in November 2020. ACE Solid Waste, Inc. also provided Staff two recent RFPs from Monticello and Circle Pines, which also included annual escalators. Staff found that annual escalators are common in this type of contract. These types of escalation scales or annual increases are typically seen due to extra processing fees the haulers are being charged. Updated Proposal from Ace Solid Waste, Inc. ACE Solid Waste, Inc. has provided staff an updated proposal for a 5 year fixed price contract at $3.98 per month if the City Council would prefer to see a fixed rate as opposed to the prices with an automatic escalator on the 1st of each year. From ACE: I think these two additional cities [Monticello and Circle Pines], along with the data you gathered, support the question of whether having annual escalators is typical — and the answer is yes. But, because ACE calls Ramsey home and we are invested with the city and community, we are willing to forego escalators to help move this to a new 5 year agreement. The new flat rate pricing is $3.98 for all 5 years, and for a quick comparison, is about 1.5K less over 5 years than the pricing provided to Council with annual price increases. • Direction needed: Should Staff continue direct negotiations with Ace Solid Waste, Inc. or if Staff should start the formal Request for Proposals (RFP) process? • Based on the revised pricing from ACE Solid Waste, Inc., Staff would recommend continuing direct negotiations with ACE, and approving a 5 year contract with flat rate pricing. Based on the research completed, Staff feels that ACE is offering a fair and competitive rate. In addition to ACE being a