Upland to discuss potential solid waste increases

Feb. 24--UPLAND -- Residents may have to pay a little more than 20 percent extra, over the next four years, on their trash bills but the city would realize an annual savings of more the $600,000 by having Burrtec Waste Industries Inc. pick up the costs for street sweeping and maintenance.

The City Council will decide whether to direct staff to extend its contract with Burrtec from seven years to 15.

The move would result in solid waste rates increasing by July. It is a move city officials hope will fill a gap in funding for the solid waste program.

"It is necessary to implement a new/modified rate structure to insure adequate funds are generated to cover the cost of the program," the staff report states.

The last time this proposal came to the council in October, city leaders failed to reach an agreement. The item is being brought back at the recommendation of the Upland Fiscal Response Task Force.

"The committee recommended we give it another go, see if things will change from the 2-2 vote," said Stephen Dunn, city manager.

The city's solid waste program revenues have been adjusted by the Consumer Price Index, but the revenue collected for disposal fees is fixed at 2007 costs.

The CPI adjustments are not enough to cover costs increases for disposal of green waste and other programs, resulting in a decline in funds.

If the city were to retain Burrtec, Upland would see a savings in its general fund and solid waste fund:

--$250,000 to the general fund for street sweeping services.

--$36,000 to the general fund for street service equipment leasing payments.

--$150,000 to the solid waste for the hazardous waste program.

Burrtec would pick up the costs for alley and street repair related to any damage done by the trucks, which the city estimates at $200,000, Dunn said.

The move could be a significant savings for <location value="LU/us.ca.upland" idsrc="xmltag.org">Upland which has about 16 miles of alleys. Costs for repairs and maintenance in the past have been as high as $1 million, he said.

A resident who pays $15.54 a month for a 35-gallon can will have to pay an additional 45 cents to a rate of $15.99 by July. The rate goes up 64 cents from $15.99 to $16.63 in July 2015. The increases result in a resident with a 35-gallon can paying $3.17 more by 2018.

"The proposal is actually a lower rate than if we tried without Burrtec," Dunn said.

The company is picking up costs that otherwise would have been adjusted to rates in the coming years, he said.

Mayor Ray Musser said he got the report late Thursday and had not had a time to review the it, but he said his main concern is the length of the contract.

Upland has had Burrtec handle its solid waste for 13 years and by extending it another 15 years, that would mean it would 28 years before the city put the process out to bid, he said.

Musser, who helped bring the Burrtec contract to the city, said he has only had two calls in the last six years about the trash. The city did hire R3 Consulting Group Inc. in November 2012 to assist in evaluating the program and help identify emerging issues, such as implementing new state regulations. At that time, the city was looking at raising rates, unbeknownst to Burrtec, when the city's consultant contacted the company looking for information. It was then that Burrtec was alerted and provided this option to the city, Dunn said.

But Musser said he believes there is a chance the city could get a better offer if it requested bids for proposals, despite the potential $628,000 in annual savings.

"Isn't that tempting? Especially when you are trying to break even," he said. "But how do you know if you can do better, if you keep doing what you're doing."

The only problem is the city has a seven-year continuous contract with Burrtec, Dunn said.

Which means if the city decides on Monday night not to approve the contract, and go out to bid, it would have to wait six years before it can request proposals, he said.

"Landfills are closing, they are not opening," Dunn said.

It opens the city up to unknown costs in the future, such as fuel increases, which could defeat the purpose of going out for bid and looking for great savings, he said.

"That's a roll in the dice and we can't predict the future," Dunn said.

The council meets Monday at 7 p.m., at City Hall, 450 N. Euclid Ave.

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