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Resource Recycling Magazine: San Francisco sued over disposal contract

Resource Recycling Magazine: San Francisco sued over disposal contract

San Francisco sued over disposal contract

By Bobby Elliott, Resource Recycling

July 28, 2015

A subsidiary of Waste Management has sued the city of San Francisco over a long-term and lucrative disposal contract awarded to competitor Recology last week. The city and Recology say the contract simply went to the lowest bidder.

Filed July 21 by Waste Management of Alameda County (WMAC) in the Supreme Court of California for the County of San Francisco, the lawsuit claims San Francisco's Department of the Environment (DOE) "circumvented the competitive procurement rules" to award a multi-year disposal contract worth upwards of $100 million to Recology.

While a number of accusations are leveled at DOE and Recology in the lawsuit, WMAC claims the contract, which was officially approved July 22, was designed to avoid a vote from the city's Board of Supervisors and public scrutiny. The Board has to approve of any contract lasting 10 years or more and worth at least $10 million annually.

The contract, which can be viewed here, will hand over disposal duties to Recology starting in January. Recology already collects and transports the city's municipal solid waste but had been sending it to a WMAC landfill about 50 miles east of San Francisco since 1987.

Eric Patashner, Recology's vice president and senior director of strategic affairs, said in an interview with Resource Recycling WMAC offered a bid to continue disposing of city waste but was outbid by Recology.

"Right now, San Francisco pays roughly $21 per ton for disposal at Waste Management's Altamont Landfill," Patashner stated. "Waste Management bid it up to $66.79 per ton and our bid was around $30 per ton. I don't know what's preferential about a city deciding not to take a 300 percent increase on their disposal contract."

Patashner added Recology's Hay Road landfill, which is roughly 60 miles northeast of the city, has capacity to receive San Francisco's waste "well beyond" the terms of the new contract and expects annual disposal volumes to decrease during the course of the contract, especially as the city continues to "ratchet down" disposal. He estimated the contract will generate annual revenues between $10-12 million for Recology.

In a statement, DOE spokesperson Guillermo Rodriguez said the city's RFP process, which began in 2009, was "fair, open, competitive and public."

"Waste Management’s bid would have cost San Francisco residents and businesses over $100 million more over the life of the contract," Rodridguez stated.

The contract DOE eventually reached with Recology notes the company's bid, first entered alongside Waste Management's back in 2009, "included proposed disposal rates that were substantially less than those of Waste Management, potentially resulting in considerable savings for the City's ratepayers."

It also states the Board of Supervisors unanimously approved the RFP process and selection of Recology in February 2014 as part of an earlier framework for the deal.

While DOE first gave the contract over to Recology in 2009, WMAC and others opposed the deal on the grounds that it included "bundled services" and consequently pushed the city to have it overturned. WMAC sued the city in 2011 but the case was thrown out.

Now, with the contract signed and official, WMAC is seeking to nullify the pact and take back disposal responsibilities at its Altamont Landfill either through direct negotiations with the city or a brand new bidding process.

"WMAC’s lawsuit asserts that the City continues to flout the competitive bidding rules in order to sole source the contract to Recology, and now must be compelled to follow the rules and negotiate a contract with bidder WMAC, which has provided San Francisco waste disposal at its Altamont Landfill in Alameda County since 1987, or if it refuses to take that course of action it must go back out to bid and conduct a fair, transparent and open process," a press release from WMAC reads.

WMAC had not returned a call for further comment as of press time.

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Source: Resource Recycling
Resource Recycling Magazine: San Francisco sued over disposal contract
San Francisco sued over disposal contract By Bobby Elliott, Resource Recycling July 28, 2015 A subsidiary of Waste Management has sued the city of San Francisco over a long-term and lucrative disposal contract awarded to competitor Recology last week. The city and Recology say the contract simply went to the lowest bidder. Filed July 21 by Waste Management of Alameda County (WMAC) in the Supreme Court of California for the County of San Francisco, the lawsuit claims San Francisco's Department of the Environment (DOE) "circumvented the competitive procurement rules" to award a multi-year disposal contract worth upwards of $100 million to Recology. While a number of accusations are leveled at DOE and Recology in the lawsuit, WMAC claims the contract, which was officially approved July 22, was designed to avoid a vote from the city's Board of Supervisors and public scrutiny. The Board has to approve of any contract lasting 10 years or more and worth at least $10 million annually. The contract, which can be viewed here, will hand over disposal duties to Recology starting in January. Recology already collects and transports the city's municipal solid waste but had been sending it to a WMAC landfill about 50 miles…

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