Vancouver City Council

CITY OF VANCOUVER

ADMINISTRATIVE REPORT

Date:

September 4, 2003

Author:

Aby Sharma

Phone No.:

871-6059

RTS No.:

03582

CC File No.:

3758

Meeting Date:

September 18, 2003

TO:

Standing Committee on City Services and Budgets

FROM:

General Manager of Engineering Services

SUBJECT:

Apartment Recycling Collection Contracts

RECOMMENDATION

THAT Engineering Services issue a tender requesting bids for 1-year and 5-year terms for the Apartment Recycling Collection for the areas currently serviced by private contractors.

GENERAL MANAGER'S COMMENTS

To ensure that long term minimum cost for Apartment Recycling is achieved, City staff will develop a business case to determine the City's cost to service all and each apartment area for comparison to private bids. This information will be available when the bids are presented to Council. We require at least a 1-year term from private contractors to continue service in areas I - IV, even if City forces are to service some or all of the areas that currently have private service. This is due to a 12 to 18 month lead time to acquire new equipment.

COUNCIL POLICY

On April 28, 1998 Council approved contracting out a portion of the Apartment Recycling Program to private contractors.

On February 25, 1999 Council awarded Tender 9900 to three different companies to provide recyclable collection service in four contract areas (Area I, II, III and IV, shown in Appendix A).

On April 13, 1999 Council approved the purchase of three additional Recycling trucks for the City's portion of the Apartment Recycling program (Area V).

PURPOSE

The purpose of this report is to present to Council options for collection of recyclables from apartments in areas I, II, III and IV, which are currently serviced by private contractors. The existing contracts are up for renewal in April and July 2004.

BACKGROUND

On April 28, 1999 Council approved the Apartment Recycling Program (ARP) which included using private contractors and City crews for collection of recyclables. Prior to the City, taking this on, private contractors serviced these apartments. When the City implemented the ARP, these private contractors objected to the City's involvement. To give an opportunity for continued operation by a number of small companies, Council provided the opportunity to the contractors to bid on Areas I, II, III and IV of the ARP collection areas.

With the City divided into 5 areas, private contractors service Areas I, II, III and IV while Area V is serviced by City crews (Areas shown in Appendix A). Tender 9900 was awarded to Canadian Waste Services (Area I), International Paper Industries (Area II & IV) and Urban Impact Recycling (Area III). These areas consist of dense multi-family neighbourhoods and were selected to minimize recycling truck traffic. The contracted service area contains roughly 40 % of all residential dwelling units in Vancouver.

The following table summarizes the number of suites and buildings serviced by private contractors in each area as of July 2003.

AREA

Contractor

Number of Suites

Number of Buildings

I

Canadian Waste Services

50,047

817

II

International Paper Services

21,709

948

III

Urban Impact Recycling

13,112

437

IV

International Paper Services

12,612

508

The ARP was designed to provide recycling services to all Vancouver residential buildings that did not receive the blue box program. This program involves voluntary participation and a mandatory utility fee. The categories of recyclables, collected weekly (old newspaper, mixed paper and mixed containers), are the same as the blue box program. Each apartment building utilizes either a blue box with the associated blue and yellow bags or a centralized 360 litre wheeled cart collection system. In general, apartments with more than 5 units use carts and all others use blue boxes.

The ARP has been a success and the companies who participated have been providing a satisfactory level of service.

The contract tendered in 1999 was a 5-year contract. This allowed contractors to absorb the large capital costs associated with the new collection program as well as the program start-up costs over a longer period of time.

DISCUSSION

Current situation:

The current ARP contract expires in 2004. The expiration dates are April 30, 2004 for Areas I & III and July 31, 2004 for Areas II & IV. The expiration of these contracts presents an opportunity to evaluate both City services as well as private contractor service to provide the most cost effective ARP collection service to City residents.

Area V is currently serviced by City forces. We do not have enough equipment to service any or all additional areas in the ARP. The usual time required to purchase new trucks varies from 12 to 18 months.

Proposed Scenario:

To provide the lowest cost to City residents, it is recommended that during the upcoming retendering process:

· Engineering Service request, bids for a 1-year and a 5-year term starting in 2004 at the end of the current contracts for servicing each individual area.
· Contractors submitting bids must submit bids for both the terms.
· Engineering Services will evaluate these bids for individual areas based on (but not limited to)
o The scheduling of the work to fit in with the City's requirements
o Minimum overall cost impact of the tenderer to the operations of the City
· The City will evaluate the 5-year bids and compare with the costs to the City if City forces service these areas.
· If it is found that the City service would be more cost effective, then a contract will be awarded to the lowest 1-year term and City forces will start servicing that area when the 1-year term expires.
· If it is found that the estimated cost of servicing by City forces is higher than private contractors, then the contract will be awarded to the lowest 5-year bid for that area.

For City forces to be able to service these areas by May 2005 (after the 1-year term expires), Engineering Services would have to purchase additional trucks. More detailed analysis is being done to ascertain the number of new trucks required and the delivery schedule.

FINANCIAL IMPLICATIONS

It is believed that when the contract is tendered in 2004, the prices tendered by outside contractors could be lower than current rates as the current prices included setup costs and a significant element of risk. It is expected that a tender would be very competitive.

Apartment recycling service costs are funded by the fee charged to the users through the Solid Waste Utility.

PERSONNEL IMPLICATIONS

If City forces are to provide collection services in any or all of the currently contracted areas, there will be a requirement for additional personnel in the Sanitation Operations Branch. Detailed analysis needs to be done to accurately predict the number of positions required. A detailed report will be done for any contract award or as part of the implementation plan in the event that City forces service any or all of areas I, II, III and IV. If it is decided to award the contract to private contractors, no additional personnel would be required.

CONCLUSION

The Apartment Recycling Program contracts expire in April and July 2004. Currently the City is divided into 5 areas and private contractors service 4 of these areas. To ensure City residents are provided with the best value for their recycling services, it is recommended that Engineering Services issue tenders for 1-year and 5-year terms. Engineering services will evaluate these bids and determine if the lowest cost to the residents would be provided by City forces or private contractors. Subsequent to this evaluation Engineering Services will decide if the contract would be awarded for a 1-year or 5-year term. The contract will be awarded to the bidder with the lowest bid price meeting the specifications for either the 1-year or 5-year term.

* * * * *

APPENDIX A:
CONTRACTED AREAS FOR APARTMENT RECYCLING PROGRAM

AREA

Description

Number of Suites

Number of Buildings

I

Bounded by Stanley Park, English Bay, False Creek, Terminal Ave., Main St., Burrard Inlet and Coal Harbour

50,047

817

II

Bounded by Larch St., 4^th Ave., Balsam St., 5^th Ave., Vine St., Broadway, Burrard, 14^th Ave., Firs St., 16^th Ave., Marpole Ave., 15^th Ave., Oak St., False Creek and English Bay

21,709

948

III

Bounded by Oak St., 16^th Ave., Cambie St., 10^th Ave., Ontario St., 16^th Ave., Main St., 15^th Ave., Prince Edward St., Kingsway, Broadway, Glen Dr., Terminal Ave. and False Creek

13,112

437

IV

Bounded by Main St., Terminal Ave., Glen Dr., Broadway, Commercial, Venables St., Victoria Dr., Hastings St., Nanaimo St. and Burrard Inlet

12,612

508

	Date:	September 4, 2003
	Author:	Aby Sharma
	Phone No.:	871-6059
	RTS No.:	03582
	CC File No.:	3758
	Meeting Date:	September 18, 2003

TO:	Standing Committee on City Services and Budgets
FROM:	General Manager of Engineering Services
SUBJECT:	Apartment Recycling Collection Contracts

AREA	Contractor	Number of Suites	Number of Buildings
I	Canadian Waste Services	50,047	817
II	International Paper Services	21,709	948
III	Urban Impact Recycling	13,112	437
IV	International Paper Services	12,612	508

AREA	Description	Number of Suites	Number of Buildings
I	Bounded by Stanley Park, English Bay, False Creek, Terminal Ave., Main St., Burrard Inlet and Coal Harbour	50,047	817
II	Bounded by Larch St., 4^th Ave., Balsam St., 5^th Ave., Vine St., Broadway, Burrard, 14^th Ave., Firs St., 16^th Ave., Marpole Ave., 15^th Ave., Oak St., False Creek and English Bay	21,709	948
III	Bounded by Oak St., 16^th Ave., Cambie St., 10^th Ave., Ontario St., 16^th Ave., Main St., 15^th Ave., Prince Edward St., Kingsway, Broadway, Glen Dr., Terminal Ave. and False Creek	13,112	437
IV	Bounded by Main St., Terminal Ave., Glen Dr., Broadway, Commercial, Venables St., Victoria Dr., Hastings St., Nanaimo St. and Burrard Inlet	12,612	508