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Millions of dollars at stake as Hillsborough renews garbage hauling contracts

A Waste Management garbage truck empties its collection in Hillsborough County, which is considering opening its trash hauling contracts to bids. Waste Management is one of the three haulers now holding contracts.

JOSEPH GARNETT JR. | Times (2005)

A Waste Management garbage truck empties its collection in Hillsborough County, which is considering opening its trash hauling contracts to bids. Waste Management is one of the three haulers now holding contracts.

TAMPA — Hillsborough County solid waste officials will ask permission this week from commissioners to seek new bids from companies seeking to perform curbside garbage pickup.

The county's three current haulers will have had a virtual monopoly for 17 years by the time their contracts expire in 2013. Improvements in technology, and falling prices elsewhere, make it past time to seek new offers on the open market, waste officials say.

But what might seem like a no-brainer is far from certain as commissioners prepare to debate the issue and take public comment Wednesday. At stake are new contracts that could top a half-billion dollars in value through their lifetime, $60 million alone in the first year.

The existing haulers, who rain thousands of dollars in political donations on commissioners annually, have unleashed an election-style marketing blitz to kill any prospects for competitive bidding. They're calling garbage customers through phone banks and even have their own Facebook page: "Leave Our Trash Service Alone."

Its message: "If it ain't broke, don't fix it."

Representatives for the three haulers are speaking as if they rehearsed their message together. Customer satisfaction with current trash service stands at 99 percent, each notes, citing the county's last survey in 2009. Rates for the county's roughly 250,000 households are not bad, topping out at $11.18 a month for twice-weekly pickup and weekly recycling and yard waste service.

Going out to bid offers no guarantee rates won't go up. And the transition to new companies could be chaotic, as it was after 1996 when thousands of customers called commissioners for months complaining of missed service.

Those companies are now asking commissioners to renegotiate with their longtime, trusted partners on new terms of service.

"We have a 99 percent satisfaction rate. Period," said Beth Leytham, a public affairs consultant working for Waste Management, one of the three haulers. "And we are reasonably priced. Be careful what you wish for."

The message has some resonance with some commissioners.

"It's kind of like, 'If it ain't broke, don't fix it,' " Commissioner Sandra Murman said.

Murman, Ken Hagan and Victor Crist, all Republicans and avowed free-market advocates, say they are leaning toward renegotiating with existing haulers.

Democrat Les Miller said he's on the fence and wants to hear from the public, current providers and prospective ones. "There's a lot of lobbying going on," he said. "It's probably been one of the most contentious issues in my year on the board."

Al Higginbotham and Mark Sharpe, both Republicans, and Democrat Kevin Beckner say they want to seek bids.

"We've got Republicans who put forward an image of being fiscally conservative watchdogs for the people yet don't support seeking bids," Higginbotham said. "This should be a no-brainer."

The county's current garbage haulers are Waste Management, Waste Services and Republic Services. Each picks up residential garbage in a defined area at negotiated rates. In return, they get exclusive rights to compete for most commercial garbage pickup throughout the county, setting their own rates.

They, or predecessor companies, won the contracts through bidding in 1996. At the time, waster-hauler BFI had a 24-year-old contract to provide residential pickup. Its message then against going out for bids: "If it ain't broke, don't fix it."

This time, prospective bidders have launched a campaign to persuade commissioners to test the market. The most visibly active is Longwood-based Waste Pro, a 10-year-old company that has expanded rapidly in Florida.

Its message: Times have changed. There are new companies and new technology, from automated pickup to natural gas-powered vehicles. And bidding is the only way to test whether residents are getting a good deal.

"Renegotiation is not going to get the best price," said Keith Banasiak, Waste Pro's regional vice president. "The incumbents really know that, in a bid process, you're going to have to get your pencils sharp."

A recent report prepared for Hillsborough by Kessler Consulting Inc. shows several nearby governments have secured lower prices through bidding. They've saved anywhere from 4 percent in Lee County to 31 percent in Polk, where the price of pickup is now $7.96 a month.

Both counties went to once-a-week garbage pickup in securing their bid prices.

Hernando County recently landed a $7.13 monthly rate — nearly 40 percent less than what Hillsborough residents pay — while maintaining twice-weekly service with less frequent yard waste pickup.

Given those results, Banasiak said of Hillsborough's garbage collection service: "It is broke."

Consider that if Hillsborough had Hernando's rates, residents would save close to $124 million in the next 10 years — or nearly $50 a year per household.

Banasiak points to Manatee County as a telling example. After recent bids, its rates went up slightly from $6.27 a month per household.

The key part is this: The county initially sought to renegotiate with its single hauler, Waste Management, getting offered a $12.50 monthly charge per household. It then went out to bid, securing a monthly rate of $7.46 from Waste Management and Waste Pro, which now split the service.

County solid waste officials last week made their recommendation to commissioners. By nearly any standard, from price to improvements in recycling, the chance for a better outcome lies with bidding.

The main exception: If bids result in a change in companies, making the switch could be a challenge. But officials say in their report that advances in technology, such as improved mapping and tracking capability, coupled with better planning, should help the county avoid problems like it had in the past.

Steve Anderson, a lawyer and spokesman for Waste Services, disputes the county's report. He says the only thing bidding offers is uncertainty.

"Maybe it will rain bunnies on Easter," Anderson said. "But we have no clue. Just like we have no clue what bidding will bring."

.If you go

Bids discussion

Hillsborough commissioners will discuss the possibility of seeking bids on the county's waste-hauling contracts during a meeting at 1:30 p.m. Wednesday at the County Center, 601 E Kennedy Blvd., Tampa.

Millions of dollars at stake as Hillsborough renews garbage hauling contracts 12/10/11 [Last modified: Saturday, December 10, 2011 11:13pm]
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