Solid Waste Proposal Options Council Workshop March 5, 2014

 Current contract expires June 30, 2014  Interlocal consolidated service bid package developed with the Town of Middletown  Bids received December 17, 2013 Background

Bid Package (see handout)  Curbside Collection Program  Bulky Waste Program  Yard Waste Program  On-street Litter Barrel Program

Objectives and Goals  Increase recycling rates to decrease disposal costs via volume reductions and incentives  Solid Waste $32/ton or $54/ton versus Recycling $0/ton  Note: $32 rate has been in place for 22 years with pressure mounting to increase this rate

Objectives and Goals (cont’d)  Incentives:  $29/ton for recycling rates > 35%  $30/ton for 30% %  $31/ton for 25% %  Plus general profit sharing incentives as applicable per RIRRC municipal contract based upon fluctuating recycling markets

Objectives and Goals (cont’d)  Maintain program services while exploring options to increase program cost savings and operational efficiencies  Promote continuous improvement thru further advancement of overall clean city program goals

Newport Recycling Rates

Solid Waste Proposal Options a Financial Perspective  Singular bidder – Waste Management (WM)  Financial information is based on WM’s 5 year proposal  Four scenarios will be presented  Scenario #1 – Status Quo, Non Cart Based Collection  Scenario #2 – Cart Based Collection  Scenario #3 – Cart Based Collection, ‘Pay as You Throw’ (PAYT)  Scenario #4 – PAYT, Non Cart Based Collection

Scenario #1 Status Quo

Scenario #2 Cart Based Collection, Cart Cost Paid in Year #1 Cart Cost Paid Over 5 1%

Scenario #3 Cart Based Collection, PAYT in Bags, Cart Cost Paid in Year #1 Cart Cost Paid Over 5 1%

Scenario #4 No Carts, PAYT in Bags, PAYT Bulky Waste

Scenario Summary, 5 Year Cash Flow

Note #1: The City is trending towards exceeding the FY14 Solid Waste Cap of 7,597 tons which is set by the General Assembly. In FY14, disposal fees incurred by the City amount to $32 per ton up to 7,597 tons and $54 per ton after 7,597 tons. Based on FY14 data, the City will most likely exceed the Solid Waste Cap in FY15 under Scenario #1 (Status Quo) which could result in additional annual costs upwards of $30,000 which are not reflected in Scenario #1. Notes to Scenarios Note #2: Scenarios 2A, 2B, 3A, 3B & 4 are expected to reduce trash tonnage by 10% to 22%, resulting in annual disposal savings between $23,000 and $50,000.

Note #3: In scenarios 3A, 3B and 4, Pay-As-You-Throw (PAYT) annual revenue is estimated at $674,000 based on household usage from existing municipal programs at 1.25 bags per household per week. Note #4: Recyclables are brought to Rhode Island Resource Recovery Corp for $0 per ton, so it is advantageous to increase our recycling tonnage and decrease trash tonnage. Note #5: Based on Waste Management's proposed 5 year contract, each scenario is subject to an annual Consumer Price Index increase which is capped at 2.5%. Note #6: With the exception of scenario #4 PAYT bulky waste, the City will incur annual bulky waste costs of approximately $41,000 and annual yard waste costs of approximately $176,000. Notes to Scenarios

Timeline  March 5, 2014 – council workshop  March 2014 – council and citizen feedback  Early April 2014 – council selection of option  April 2014 – anticipated contract award  July 1, 2014 – new contract commences