|Jefferson County Residential Solid Waste Background Information|
Lots of feedback this past week on the County’s social media channels about residential solid waste collection in Jefferson County. The quality and level of service and the prices.
We want residents to have the highest level of service possible at the best value possible. We’re not here to make excuses for anyone, or to run interference on their behalf.
But we also need to be honest with ourselves and engage in transparent, clear – and most importantly fair dialogue without some of the political subterfuge, undertones, and innuendo.
Note: the Commission doesn’t decide to take action on these things themselves. Items are brought to the Commission with a recommended path of action by the County Manager – and have been since 2011. We have smart employees who study these issues and make recommendations based on the best course of action – sometimes between choices that are all lousy. That’s what happened here.
The County does not provide residential solid waste collection services. A decade ago, there were multiple solid waste providers serving Jefferson County. When it came time to bid, the entities that could provide the best service for the best price indicated they would only bidif there was an exclusive franchise agreement for the entirety of unincorporated JeffCo. Jefferson County is not a mandatory collection county and individual residents must set up service with Amwaste and pay them to receive service. The sole purpose of the county bid is to rely on economies of scale to get residents the best price possible.
After a 2016 bid, Advanced Disposal (no longer in existence, purchased by Waste Management) became the provider. At some point, Advanced began to experience the issues that are impacting the entire waste management industry – with the County fielding a persistent, high-volume of service-related complaints. The contract was up for renewal in 2020 and with the hope that issues would improve under Advanced Disposal’s new ownership, Waste Management, the County elected to do a 1-year renewal to see if things would improve.
Things did not improve and the County elected to rebid service. At this time, the rate under Advanced was $12.47/month (37.41/quarter).
The invitation to bid went out in September of 2020, bids were accepted in November of 2020, with the bid awarded and contract executed in December of 2020 and service to begin on April 1, 2021.
The low bid was based on single-cart, once per week service– which is utilized by the majority of the County’s residents who subscribe.
Bids were received from:
Republic Services ($24.45/month, $73.35/quarter),
Santek – who now no longer exists after being acquired by Republic ($18.66/month, $55.98/quarter),
Advanced Disposal – who no longer exists after being acquired by WM ($18.29/month, $54,87/quarter),
Amwaste – ($14.54/month, $43.62/quarter)
Based on that, Amwaste was awarded the contract, and when service began, customers experienced a rate increase of $2.07/month,$6.21/quarter. That rate increase was still the low bid.
What changed between then and now?
In September of 2020 when the invitation to bid was issued, the average price of diesel in the United States was $2.41/gallon. When the contract was awarded in December of2020, the average price $2.58.
In June of 2022, that had risen to $5.75/gallon.
That is a $139% increase in the average price of diesel from the time the ITB was issued in June of 2022 and a 139% increase in the average price of diesel from the time the contract was entered into.
There are ripple effects here – with the increase in the price of fuel comes an increase in the cost of consumables such as parts of maintenance because freight prices go up. Petroleum products used in maintenance see increased prices as well.
Everything has gone up, and it’s difficult to fill these positions just like in the fast food and hospitality industry. Imagine how hard it is to find someone to ride around in a truck filled with your smelly fridge leftovers, bags of pet waste, your bathroom trash and all that other gross stuff.
Amwaste approached us in June and said that without being to compensate for the unexpected drastic increase in operating costs, that they were going to be unable to continue to provide service. That put us at a crossroads. If Amwaste terminated their contract and pulled out, or even worse, became insolvent – what would happen to trash service in Jefferson County?
Sure we could rebid it – but service wouldn’t be immediate. If the contract went to a new provider, that raises even more questions:
Who is going to transfer subscriber account data?
Who is going to pick up trash in the months it is going to take a new company to hire local staff, purchase carts and equipment?
Are we going to have a public health emergency with trash piling up curbside throughout the county?
What was done about it?
When you step back and objectively look at things, you’ll see that this wasn’t an issue that happened uniquely in Jefferson County. Providers all over the state and country are facing the same issues.
The goal of the County Manager’s Office in making this recommendation to the Commission was to ensure that trash service continued uninterrupted at rate that was fair to the provider and to residents base on prevailing market conditions. I think you can distinguish between something being fair and having to like something. We weren’t happy to have to make the change. We knew residents wouldn’t be happy about it. We didn’t expect them to be happy about it.
The original contract and the contracts before under previous providers, had a provision within to allow for an annual 3% increase in rates based on the consumer price index. The amendment that we authorized in June allowed for quarterly increases or decreases according to a fuel index and consumer price index.
The fuel index is based on the change from the contract base price and the average of the preceding three months based on the ALDOT Construction Fuel Index.
Based on that, the price for the July-August-Sept billing cycle increased from the current rate of $15.05/month ($45.14/quarter) to$25.23/month ($75.70/quarter).
It increased again in a smaller amount based on the ALDOT construction fuel index for the October-November-December cycle to $25.96/month($77.88/quarter).
But gas prices are falling, why did it go up again?
The contract averages the published monthly index price per gallon based of the preceding three months fuel prices. The index is ALDOTs published fuel index, not the pump price, the current billing cycle will average June, July, and August.
June saw the highest prices we have seen to date, with a fuel index of $4.04, and it has decreased to $3.87 in July and further decreased to $3.12 in August, ((4.04+3.87+3.12)/3) = 3.68 the resulting average price is $3.68 per gallon which was up from the $3.42 of the preceding quarter.
The base fuel index for the contract is $1.05/ gallon, which was the index price at the time the contract was bid; so even with the reductions in prices over the last two months, the averages are well above the base contract fuel prices that existed when the contract was bid in late 2020,and are also above what they were when the initial index adjustment was made.
But some cities offer trash collection for free!
No they don’t. You’re neighbors in those cities are paying higher property taxes that pay for that.
What is happening other places?
Chambers County, AL – Bid and received only one bid –Amwaste. $26.01/Month, 78.03/quarter
Bullock County, AL – Had Amwaste, put it out to bid, received NO bids. Has no garbage service.
Lowndes County, AL – Liberty Disposal - $31/month,$93/quarter
Shelby County, AL – Put out a bid and low bidder was$36/month, $108/quarter. Rejected all bids and bid again without recycling and got it to $20.69/month, $62.07/quarter– still a large increase from the rates they had of $12.98 with recycling.
Autauga and Elmore County, AL – Bid in January to $23.87/month,$71.67/quarter