Refuse RatesDATE:
TO:
FROM
SUBJECT:
February 12, 1982
Mayor Council
William P. Craig, City Manager
Garbage Rate 1982
"There is nothing more difficult to take in hand, more perilous to conduct, or
more uncertain in its success, than to take the lead in the introduction of a
new order of things." Niccolo Machiavelli
It is apparent that the change in garbage collection technology has fired strong
feelings on both sides in Hopkins. I think it is fair to say, based on impartial
random sample surveys, that the 90 gallon rollout containers are considerably more
popular than the previous method of collection, in the neighborhoods they have
been assigned. It also appears that the 300 gallon containers are favored by a
smaller majority, 64% in the latest survey. Opponents of the system are naturally
more vocal one would hardly expect citizens who are pleased with any mundane
city service (garbage, snow plowing, sewer service) to call up and say so. Only
about 1/3 of those with 300 gallon containers said they would prefer a 90 gallon
container, realizing there would be additional cost.
I was a little surprised by that (I suspect I would have voted for the 90, if I
had gotten a survey sheet), but when I considered that almost two out of 3 were
happy with the 300 gallon system, it doesn't stand to reason that they would be
willing to pay more for some change.
On the latest survey, the strongest negative responses were toward odor (40
neighborhood appearance (44 and difficulty in raising the lid (52 Apparently
the concern about appearance concerns the containers themselves, since 46% said the
amount of loose garbage had decreased with the new system, compared to 10% that felt
the problem was worse.
The city has several possible courses of action, but action must be taken for several
reasons. First, this is the last opportunity to get new rates on January- February-
r rch bills, and our committment for these months has automatically Increased by
contract, whether or not additional services or pay are contracted. In other words,
we will lose money without hope of recovery without a rate balancing whatever budget
is approved. Also, the rate should include a sum to build up working capital in
the account please see attached memo from the Finance Director advising the
amount of 6(31 per month to replace the present 20 per month for city billing and
administration. This amount, of course, is entirely up to your discretion.
The city's principal options for courses of action, as I see them, are as follows:
1. Hold Waste Technology to present contract terms.
2. Attenpt to seek amicable termination of contract
a) City purchase and operate mechanical system
b) City hires personnel, buys trucks, runs
conventional system.
c) City bids out private conventional system
3. Modify or add to present contract to improve service at mutually
agreed -upon price (based on supplementary bids).
Option 1 above would most probably result in default, collapse of service, and
litigation.
Option 2a is possible, but would result in higher consumer costs, since City would
necessarily have to charge for overhead costs now absorbed by Waste Technology
as advertising expense.
Option 2b would be the most expensive, based on actual costs incurred in the past.
Option 2c should be the preferred course of action if you desire to completely wash
your hands of the automated system.
Option 3 seems to me to be the soundest of the approaches currently available,
considering that any of the alternate costs (quarterly large item pickup, 90
gallon containers citywide, or whatever is chosen) are less expensive than the
individual private collection charges now paid by our neighbors in Minnetonka,
Edina, and Eden Prairie.
Respectfully submitted,
William P. Craig, City- inager
November 10, 1981
To: William P. Craig, City Manager
From: John E. Schedler, Finance Director
Subject: Refuse Rates 1982
A review of the Refuse Fund from inception shows a continued loss
for the operation and a lack of working capital.
Losses of $6,308 and $7,228 in 1979 and 1980. respectively, along
with a proiected loss in 1981 of approximately $7.100 will result in a
cummulative retained deficit of $20,636 by the end of 1981. This deficit
is after the $60,000 transfer from the General Fund in 1980. Additionally
the Refuse Fund has no working capital to carry the unbilled services.
I recommend that a working capital level of $25,000 be built up over
the next 2 years. In order to eliminate the deficit and build up the
working capital over the next couple of years, the administrative add on
to the garbage contract cost should be approximately 60 per month.
The present garbage disposal contract provides for an annual increase
of 7% of the CPI. Assuming a CPI this year of 13 that would bring the
monthly contract cost per residence to $4.91, add $.59 for administration,
for a total cost of $5.50 per month. This would be an $.80 per month
increase or 17% and still provide service at a cost level below other
communities and well below private contracting which now runs $7.50 per
month in surrounding areas.
I believe this is the time to provide for the elimination of the
deficit and build the working capital when a favorable contract rate is
available. In future years the administrative add on may be reducible.
John E. Schedler
Finance Director
JES:dmj
CITY OF HHOPK1NS
Specifications Supplementory Waste Collection
The Clty of Hopkins is seeking a quarterly service of collection, cartage, and
disposal of large, bulky, and excess trash items from all single and two family
residences in the City. Such service shall be rendered for calendar years 1982,
1983, 1984 and 1985. The trash items referenced above shall be light enough for
one collector to handle, but may be of varying shapes and sizes. Pickup shall be
made from the point that garbage is usually collected from, for each residence.
Vehicles used shall meet the Hopkins ordinances in all particulars, including
having a Hopkins license for company and vehicle. Collection method may be
either manual or mechanical; however, bids will be examined for factors involving
quality (noise, dust, traffic interference, speed) as well as cost.
The price bid (see last paragraph) will be paid to contractor on a monthly pro -rate
basis, based on actual number of dwelling units served (present estimate is 2,800).
Price bid per unit should be for 1982, prices for succeeding contract years will
be adjusted by 12 month percentage increase, U. S. Department of Labor Cost Price
Index, October to October, Minneapolis -St. Paul, urban wage earner tabulations.
Bids can be filed on any sheet of paper, but bids must:
1. Acknowledge these specification, and,
2. express cost in terms of cost per unit per month (12 month basis).
'Waste Technology Inc.
410 1 l th Ave So
Hopkins, Minn 55343
Phone (612) 935 -6921
\VMT INC.
REFUSE CONTRACT 1982
Bid specified approximately 3510 homes
Actual count is 2784
Automated Refuse
Collection Systems
January 27, 1982
This difference in the house count reduced contract by $3,272 /month
or $39,264.00/year. About 26% of revenue.
Normal increase for 1982 would be .48 /month /home based upon 70% of the
Twin Cities CPI of 15.3% for 1981.
Wetre asking for an additional .52 /month.
In return, we will provide a limited special pickup quarterly at all of
the 2784 residential stops. We will pick up a reasonable amount of
extra refuse or discarded items (weight limit of each item to be what
one (1) man can safely lift).
The total cost would go from the current 84.50/month/home to $5.50 /month/
home.
The other bidders offered similar services with the minimum charge being
$5.00 per item or stop. We are offering the same service for $6.24 /year/
home vs. their $20.00 /year /home.
CONVERTING 300 GALLON ALLEY CONTAINERS TO 90 GALLON
ROLL -OUTS
Approximately 1250 90 gallon containers would be required at $65.00 each.
Total cost of containers $81,250.00
Cost of Assembly Dist.($3.00 ea) 3,750.00
$85,000.00
Lease costs would run approximately $2.25 /month /home on alleys.
There would be some extra costs involved in picking up the 90 gallon
containers vs. the 300 gallon. This would add an additional
$.50 /month /home for the 1250 homes on alleys.
Total extra cost would be $2.75 /month /home x 1250 homes $3,437.00.
33,437.00 2784 homes (spreading the cost increase city -wide) $1.23 /mo /home
plus $1.00 increase we've asked for gives a total increase of $2.23/mo /home.
The current rate of $4.50 would rise to 36.73 /month /home.
INDIVIDUALS CONVERTING TO 90 GALLON CONTAINERS
This would have to be done on a block by block basis to be reasonable.
The increase would be $3.75 /month /home for each home converting.
f
Contract S rvice Division
Wa t T chnology, Inc.
410 11th Av So.
Hopkins, MN 55343
4 6 /1z._
City of Hopkins
1010 1st Street South
Hopkins, MN 55343
Dear Sirs:
Zig
MCS REFUSE, INC.
10 10050 Naples Street Northeast, Blaine, Minn 55434
(612) 784 -8349
February 16, 1982
MCS Refuse Inc. is please to submit the following quotation for
the supplemental waste collection services within the City of
Hopkins.
411 As an acknowledgement and additional clarification of the city's
specifications, MCS bases our bid on the following criteria:
MCS Refuse Inc. will supply collection, cartage, and disposal of
large, bulky, and excess trash items that are household in nature.
These items must be containerized, bundled, or so prepared that
they are physically handleable by one collector. For disposal,
each items will be placed at the curb, as to allow direct
accessability of the service vehicle. We cannot engage in the
disposal of radioactive, volatile, highly flammable, explosive or
toxic material. MCS can only accept bundled tree limbs under
three inches in diameter and in three foot lengths.
All items that are surcharged at the landfill, will be passed on
to the city.
MCS Refuse agrees to perform the above duties on a quarterly basis
and in an orderly manner but reserves full right to its
scheduling. We further insure that the vehicles used shall meet
the Hopkins ordinances in all particulars including having a
Hopkins license for company and vehicle.
It is understood by MCS that as the contractor, we will be paid on
a monthly pro -rated basis, based on the actual number of dwelling
units serviced (present estimate 2800). The charge per unit per
month would be $.95 for 1982. Each succeeding contract year will
be adjusted by 12 month percentage increase, U.S. Department of
Labor Cost Price Index, October to October, Minneapolis St.
CONSULTANTS AND CONTRACTORS
SERVING THE REFUSE INDUSTRY
Paul, urban wage earner tabulations. In addition to the CPI
escalator, any governmental agency tax or surcharge on collection
or disposal will be added as a pass through.
We appreciate this opportunity to be of assistance to the City of
Hopkins.
MH /klu
Sincerely,
Mark He eren
Commercial Sales
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