Public, private sectors to vie for $25M city recycling contract
BY FRAN SPIELMAN City Hall Reporter fspielman@suntimes.com September 1, 2011 1:04AM
Thousands of recycling carts sit in a Far South Side warehouse as the city plans to expand the program.
Updated: November 16, 2011 1:31AM
With thousands of blue recycling carts still stashed away in a Far South Side warehouse, Mayor Rahm Emanuel’s administration has awarded a $25 million contract to purchase even more containers.
The decision to sign yet another blue cart contract with Chicago United Industries sets the stage for the Oct. 3 start of a “managed competition” between city crews and private contractors to determine who can provide the best service at the lowest possible cost.
Under a contract that expired in June, Chicago United Industries supplied blue carts to the city at a cost of $45-per-container. At that rate, the new contract would cover 555,555 blue carts — enough to expand the program to 359,000 households without recycling and pay for 196,555 replacement carts.
Determined to transform Chicago from, what he calls a “tale of two cities” when it comes to recycling, Emanuel is privatizing four of six service areas and allowing city employees to compete in the other two.
Within four months, the mayor has promised blue-cart recycling will come to 20,000 additional households in Wicker Park, Bucktown and Logan Square.
Six months into the competition, a cost-benefit analysis will determine how city employees measured up against two private contractors: Waste Management and Midwest Metal Management.
The Chicago Sun-Times reported last summer that thousands of blue recycling carts — with a pricetag of nearly $1 million — are stashed away in a warehouse at 900 E. 103rd Street because City Hall bought them to make the citywide switch to suburban-style recycling, but ran out of money one-third of the way through.
At the time, the Daley administration acknowledged having a stockpile of “roughly 22,000” carts. Streets and Sanitation employees who eyeballed the stash insisted the actual number was greater with carts piled 15-high and 25-deep for at least a block.
Streets and San spokesman Matt Smith refused to reveal the size of the existing stockpile.
Smith would only say that the inventory has dwindled somewhat over the last year as replacement carts were delivered to some of the 241,000 households currently served by blue-cart recycling. The contracts with Waste Management and Midwest Metal Management require the city to continue to supply blue carts picked up by private contractors.
“This is a smart tactical move that will allow us the flexibility to meet our blue cart needs, whatever those might be in the future,” Smith said, stressing that the $25 million figure was only a “ceiling” and that the city would pay for the carts it needs.
“We have an existing blue cart service … that needs to be maintained and the possibility of future expansion as we improve the efficiency of our operations. Also, we are in the process of introducing competitive bidding. ... Because of all these factors, it makes perfect sense to have a contract in place.”
Lou Phillips, business manager of Laborers Union Local 1001, said he’s not surprised that City Hall is buying more blue carts.
“If they’re ordering the carts, that means they have plans to expand throughout the city. It shows they’re gung-ho to get it done,” Phillips said.
Noting that the union will be routing its own trucks, Phillips said, “I’m excited about the competition. I’m convinced we’re gonna win this. We’re gonna keep all that revenue [from the sale of recyclables] and run it more efficiently than it’s ever been run before.”
Chicago United Industries was banned by the city for allegedly acting as an illegal broker, only to be reinstated after filing a lawsuit against the city for taking the action without a hearing. The blue cart contract was supposed to expire in December, 2008, but was extended for two years without competitive bidding.
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