HomeMy WebLinkAbout27 - CRR Agreement - PowerPointAgenda Item #27
November 12,2013
Residential Refuse Collection
Agreement
Newport Beach City Council
Tuesday, November 12, 2013
Work Performed
Follow -up Interviews — September 20,
2013
Satisfaction Surveys (residents in other
cities)
Additional Reference Checks (contract
managers)
✓ Safety Ratings
✓ Updated Diversion Guarantees
Residential Satisfaction Surveys`
jurisdiction
CR &R
City of Dana Point
City of Orange
Average
Rainbow
City of Fountain Valley
City of Huntington Beach
Average
Ware
City of Laguna Woods
Unincorporated Orange County
Average
* Conducted by Probolsky Research.
99.3
95.7
97.5
98.0%
96.0%
97.0
94.1
96.2
95.2
I.
Reference Check Summary
5 Exceptional Performance
CR &R 12 6 Above Expectations
1 Satisfactory
Rainbow 5 3 Exceptional Performance
2 Above Expectations
Ware 3 2 Above Expectations
1 Satisfactory
(1) Contract managers in cities serviced.
(2) Scale: Exceptional Performance, Above Expectations, Satisfactory, Below Expectations,
Unsatisfactory
Safety Rati ngs
CR &R 0.70
Rainbow 0.87
Ware Not provided
(1) Determined by the National Council on Compensation Insurance and helps to measure the
efficacy of a company's safety programs.A rating of 1.0 is average, with lower numbers
preferable.
Updated Residential Diversion Guarantees
...
Rainbow
VMM
Initial Proposal
40%
41%
43%
Updated Proposal
45 %, 65% Optional (1)
50% 2014 -2019, 75% in 2020
,..
(1) CR &R offers a 65% diversion rate if the City implements an organics collection program at any
time during the contract term for an additional $925,380 per year.
Note: City -wide diversion rate based on CalRecycle annual report data was 70% for
2011 and 69% for 2012.
Summary of Key Proposal Information
CR &R Rainbow
Seven -Year Net Cost to City (1):
- Core Services
$18,582,000
$27,251,000
$23,426,000
- Core and Optional Services
$19,762,000
$27,251,000
$26,791,000
Guaranteed Diversion
45%
50%,75% in 2020
48%
65% Optional (2)
EMR Rating (3)
0.70
0.87
Not provided
# of Exclusive Residential Collection
Franchises
27
3
3
Average Residential Customer
Satisfaction — Probolsky Survey
97,5%
97.0%
95.2%
Annual Size of Newport Beach
Contract as % of Total Company
2%
10%
13%
Annual Revenues
(1) Includes core, or core and optional, services as noted, less transfer station operating payments and
one -time benefits (purchase of City vehicles, "signing bonus" (Ware only), and release of $4.3 million
City equipment reserve to General Fund).Assumes 2.5% per year cost adjustments.
(2) 65% diversion guaranteed if City implements CR &R's optional organics program for an additional
$925,380 per year.
(3) Experience Modification Rating ( "EMR ") is used to measure efficacy of a company's safety program.A
rating of 1.0 is average; lower is better.
What is diverted today in Newport Beach?
CalRecycle Pounds /Home /Day Converted to Diversion
2007
9.6
7.8
41%
59
2008
9.6
6.9
36%
64
2009
9.6
5.5
29%
71
2010
9.6
5.6
29%
71%
2011
9.6
5.7
30%
70%
2012
9.6
6.0
31%
69%
Diversion Information
Mandates 50% diversion goal by year 2000
In NB, this is met via:
Commercial Solid Waste: minimum of 55% diversion rate
Represents 71% of total solid waste produced (tons)
Residential Solid Waste: 41% diversion rate
Represents 29% of total solid waste produced (tons)
AB341
Policy goal of state to achieve 75% diversion by year
2020
Not a mandate for local agencies
State to identify strategies to achieve goal
Shall not establish or enforce a diversion rate that
exceed current 50%
Service Levels
Core Services
Unlimited number of containers (three different sizes
to choose from).
Residents may place additional bags /boxes for
collection. Contractor will collect all waste placed out
for collection.
Unlimited bulky item collection: couches, chairs, small
furniture, mattresses, water heaters.
Holiday tree collection program and Summer Saturday
Collection programs will continue.
Pull -out services for disabled residents (no charge).
Voluntary recycling program: unlimited number of
recycling containers (three different sizes to choose
from).
New to Newport Beach
Enhanced Services
Large bulky item collection: refrigerators,
washers /dryers, computers, televisions (four
times per year).
Household hazardous waste (HHW) door -to-
door collection program (sharps medical waste
included).
Community shred days: important
paper /document shredding (twice per year)
Mulch giveaway event (one time per year)
Projected Savings
with the CR &R Bid
Current in -house costs = unrestrained
Seven -year estimate:
$4.3M in one -time cost avoidance /return to
GF
$1.5M purchase of City vehicles (four valuable)
$10M in operational savings ($1.43M /year)
TOTAL = $15.8M over seven years
About our Employees
September 12, 2013 Agreement
OCEA /N B League /City of NB
Employees may choose:
Stay with City in other open positions
Move to vendor with incentive (some retire)
Leave City service with incentive
Example of Employee Transfers
Refuse
Division
MOD
Parks
Division
Water
Refuse Refuse Equip Op Equip Op Util Util
Worker II Worker II II II Specialist Specialist
= Vacant Position (s)
Example of Employee Transfers
Refuse
Division
MOD
Parks
Division
Water
Refuse Refuse Equip Op Equip Op Util Util
Worker II Worker II II II Specialist Specialist
= Vacant Position (s)
Example of Employee Transfers
Refuse
Division
Refuse Refuse
Worker II Worker II
MOD
Parks
Division
Water
Equip Op Equip Op Util Util
II II Specialist Specialist
= Vacant Position (s)
Community Outreach
City Manager's Community Newsletter
Copy to all NB residences
Generated about 100 e- mails, about 10% not
in favor of outsourcing
Generated about 35 calls, six not in favor.
City's Website
700 web page hits
Community Outreach
Outreach Meetings
Multiple meetings with interested residents
Balboa Island, Peninsula, CdM (2), Harbor View
Dads, more
Cart Displays
In eight (8) central locations (libraries)
Informational flyers
3 cart samples in each location
Home cart tests
Transition Process
Continued Public Outreach: CR &R and City staff
community meetings
Brochures /Postcards with Information on
automated Collections
Residents Receive Information on Cart Size
Selection, Number of Carts, Voluntary Recycling
Program, and Site Visit Request
Container Delivery Starts: old containers collected
and recycled
Automated /Semi- Automated Collection Begins
CR &R and City Personnel in Field to Work with
Residents
Key Questions Raised
What is the right diversion amount for
Newport Beach?
Today
In the future
Who is the low -cost bidder?
Did we take into account late changes
Diversior
AB 341— goal of 75% by 2020
Diversion is more than just residential stream
Newport Beach is at 69 -70% today
Proposed contract suggests 45% diversion
from the residential stream
Q:
Does
it make sense
to pay more now for
a
higher
diversion that
may not be needed?
Who is the Low Cost Bidder
Over a ten -year period:
Assume CR &R goes up by 5% per year
Rainbow capped at 2.5% _ '$5.1M higher than
CR &R
Ware w/ 1St three years of 0% increase =
'$7.1M higher than CR &R
Changes After Submittals
We expect proposers to put best foot
forward the first time
Making it iterative = a race to the bottom
Calls into question the City's whole
procurement process