Someone's trash is another person's treasure
On Monday, May 3rd the Mission Viejo City council will engage in some serious trash talking.
When you are about to issue a 10 year Contract that could reach $100 million dollars, we are no longer talking “chump change.”
There were four bidders responding to the city’s RFP who were evaluated by the firm of Sloan Vazquez. The bidders are: Athens Services; CR&R; Ware Disposal Co.and Waste Management of Orange County (who is our current trash hauler).
Each member of the council was invited to go on a tour of their facilities with the consultant. The Sloan Vasquez recommendation was based on the following scoring system:
1) Each of the four bidders passed with regards to the responsiveness to the RFP
2) Qualifications & experience Max score 250 % of total evaluation 25%
3) Proposal for Collection Services 250 25%
4) Solid Waste Diversion/Disposal Plan 200 20%
5) Cost Proposal 200 20%
6) Financial Ability 75 7.5%
7) Lack of Exceptions to Draft Contract 25 2.5%
Larry, cut to the chase. Who are they recommending?
Oh, you can’t wait!
Waste Management scored highest in 4 of 6 categories and has a 95.1% of total points awarded. Coming in second with 91.0% was CR&R followed by Athens at 88.5% and Ware Disposal coming in last at 77.6%
The staff report, Item #11, states that: “Sloan Vazquez has completed the evaluation and ranking of the proposals, based on the scoring system in the approved RFP, and ranked the proposals from high to low, as follows: 1) Waste Management of Orange County, 2) CR&R, Inc., Athens Services, and 4) Ware Disposal.”
“The next step in the process is the negotiation of a final franchise agreement.”
Our current residential rate with Waste Management is $14. Their proposal, that is subject to negotiation by the council, calls for a reduction to $13.74 which is the highest cost of all four bidders. I am told that they will lock in that rate for the first two years. Trash removal pricing in all subsequent years will be subject to a COLA.
One major advantage for W/M is that they have been providing this service for 10 years and have a fleet of natural gas trucks and experienced drivers serving our city. I have not looked at the commercial aspect of the RFP which was part of the overall ranking.
So the costs will go down? There you go MV, good Job!
Doesn’t Ware do Santa Ana and isn’t Judy Ware a big player in local politics there? If so, their score isn’t a very good reference for other work in the County.
Ten years is also too long for a competitive situation like this — five is more reasonable. And in this financial climate, costs should play a larger part in the evaluation, at least 30-35%.
Lurk,
Ware’s site in Santa Ana continuously violates our city code. This helped doom her bid to serve the City of Orange. I hope she loses the MV bid too.
Lurk.
I agree that cost to the consumer should have a heavier weight in this agreement.
It has been brought to my attention that a margin of less than 4% of the overall evaluation of the top two bidders is stastically not relevant.
It will be very interesting to watch as the majority of our council has taken campaign contributions from these suppliers.
Cathy Schlicht is the only member who should be making the call.
I don’t think Dave has taken any money from them, has he?
Big Mark.
Not having seen his 460’s I cannot answer. My best guess is that Dave Leckness has not received any campaign contributions from these bidders.
JP, Frank and Trish have each received thousands.
Folks.
See the “rest of the story” on part 2.
This is one exception to our permitting trash talk on the Juice
Larry,
We don’t always agree, but I wanted to credit you for a very fair and balanced, and factual report. Kudos.
Newbie.
Thank you!
There is an argument that warrants in depth discussion/explanation by Sloan Vazquez relating to their weighted factors for scoring the four trash haulers. Cathy Schlicht tells me that she requested access to some of their data and was denied that request by the city manager.
While I enjoy knowing that my trash is always picked up on schedule I want assurance that the service wiil continue without interruptions. For one company to be 25 percent below another requires some digging into their financials. Hopefully it is not the case of “buying the business” and requesting rate increases shortly thereafter. Perhaps the high bidder has a larger overhead to contend with.
In industry there were times when we took business virtually at cost to keep our factory running.
While I know some of the W/M staff, and have been happy with both their 10 years of service and community outreach, that in itself should not override a sizeable cost differential.
However, the trash removal contract has NOT been issued. While the other aspects speak for themselves, one area that can easily be addressed is the ability to negotiate a lower cost if the vendor is receptive.
The president of a midwest firm that we represented attended a cost reduction meeting in San Jose where he told the OEM’s decision makers that he would do anything for them except go out of business.
It appears that the ball is in the hands of the city council. Based on their professional experiences, my advise to each of them is to consult with those of us who have negotiated multi-million dollar contracts to see if in fact we are getting the best bang for the buck. Prior to Monday’s meeting they must abide by the rules of the Brown Act which limits their internal dialogue to a maximum of one other council member.
I would suggest that you all go to this City of Mission Viejo website: http://dms.cityofmissionviejo.org/sirepub/mtgviewer.aspx?meetid=1540&doctype=AGENDA
Then go to number 11 and click on the consultants report. If you can stay awake for the entire 18 pages, you will see that it proposes to take $15 million more out of the city residents and businesses pockets over the life of the 10 year contract. Stop blogging and start reading. Then ask where the exta $15 million is going?
Waste Management may be more expensive but what about the great things they’re doing for our community? My daughter and I frequent the Mission Viejo Library where every April Waste Management donates $5 to the library for every ton of recyclables discarded by residents. My daughter and I enjoy this program and I think it’s teaching her great lessons. And they are now teaming with Goodwill.
Read more: http://www.oclnn.com/orange-county/2010-03-24/environment/mission-viejo-goodwill-team-up-with-new-donation-service#ixzz0miLpKfSL
I know they are also working with Mission Hospital to help make the hospital green. I am writing the council to express my support for extending the contract with Waste Management!
Larry, CRR is cheaper because they are proposing to use 20% less equipment. that means that the drivers will be speeding around to get the carts picked up quicker, their putting peoples safety at risk because they will be in a hurry and they will be more messy because carts will be knock on the ground and trash will be all over the place. WM does a good job, but they are higher costs because they are publicly owned and have to pay the bonus checks to thier big wigs. Athens has all kinds of safety and legal issues, as well as they are they only large hauler that is still not using alterinative fuel vehicles, plus they have to take the garbage to another haulers processing facility because thiers is to far. This blog always gives Ware a bad wrap even though they are the only trash hauler besides WM that is involved with anything in the city when it comes to recycling, including the recylcing of the cities construction waste, which helps the city meet its AB939 requirements. If the city didn’t meet this which it wasnt, then the state could be fining the city 10,000 dollars a day til they were. Don’t think the state isnt looking to get these fines right now. Plus Ware runs all CNG trucks.
Its tough to choose, but I know that CRR and Athens would be bad for the city.
paulie,
Ware routinely breaks the law in Santa Ana, where they are located, and gets it away with it because of donations to our city leaders.
There is a reason why the City of Orange went with CR&R and not Ware.
Ware also gives a ton of money to the worst politicians in Orange County.
The people of Mission Viejo need to look up those donations and see for themselves.
CR&R is a very good company. They are growing while Ware and Waste Management are shrinking.
Paulie.
There are those in Mission Viejo who are very vocal on this RFP. I have received many calls with strong positions on the Sloan Vazquek scoring system and recommendation. And we should be having this conversation when you are negotiating the biggest contract in our 20 year history. It might reach $100 million!
W/M does a good job in multiple ways. Over the past decade they have picked up our trash without interruption. They are active in local community/civic efforts.
That said there is still the debate on a 25% higher bid. And setting CR&R aside W/M has the highest cost for residential pick up of all four carriers. Yes, the process does leave the door open for final pricing negotiations. While this item was discussed at last night’s meeting it will becoming back for further discussion.
Perhaps you might comment on the W/M survey card they placed on our trash bins a few weeks ago where they asked how we feel about their service. I gave them high praise. HOWEVER, what was not mentioned, and until now it could not appear, would have been a comment as to whether or not the 24,000 homeowners would have the same favorable opinion if they knew that another bidder was 25 percent cheaper?
While I would not call this an “act of omission,” it surely enters the selection, decision making, process.
Brother Art, You must get your facts straight. This is not an attack on you but I have much more background in this area than you do. First of all Ware Disposal moved from the bottom 100 of top waste haulers in the nation to the mid 50’s in two years, so they are not shrinking. Source Waste age Magazine. They moved all the trucks out of Logan, Santa Ana area, which you complained so mightly about and are now in Fullerton. They operate a public recycling faclity that diverts trash from the landfill so I don’t know how that is doing the cities wrong. Years ago they have had problems, but havce worked hard to correct those. In fact they were South Orange Counties Business of the year for the Chamber in 09 and were honered by the American Lung Assoc in 09 for the conversion of their diesel trucks to clean air vehicles.
All trash companies donate to politicians, just as all major corporations that want something do. This is a practice that goes on in Washington.Art are there really any good politicians left anyways. They are all out for themselves, we all know that. WM has lots of money, as you know from the city of Orange bid, they bring in 15 billion a year so you can pay a lot of people off to get what you want with that kind of money.
CRR got the city contract for Orange because plain and simply the price was lower than every one elses, especially on the commercial side (thats the businesses not the residences). A dramatic difference, there was no way you really could not vote for them. That’s WM fault for overbidding it.
WM is actually suing CRR for predatorial pricing for that city plus CRR laid out tens of thousands of dollars to counsil members and hide it through some guy who ownes a casino. you’ll know him by his jerry curl hair, flashy suits and white porche that he drives. Look for him at the next few counsil meetings in MV when the trash is being discussed. CRR is well known for horbile service. I lived in RSM and they are not very good with keeping the streets clean and keeping the containers upright when they dump. Plus they are notoriuos for running diesel trucks and just putting clean air stickers on thier vehicles.
As for Athens go to stopathens.org. You will get a kick out of how not to operate a major trash company.
All the companies are qualified, but the only ones who have actually done anything extra for the city of MV, especially when it comes to recycling efforts, Earth Day, helping the school districts recyle. You might not be aware that WM just assist the city in getting a 400,000 grant to help with food recxycling, while Ware Disposal assist Saddleback Valley USD to get a 250,000 grant to assist with recycling.
Art, you can’t just look at all the bad. CRR and Athens have done nothing for MV except donate money to counsil members.
Paulie Shore.
If I served on the council I would be on the phone to the city managers and city council members of our neighboring cities that awarded their trash hauling contract to CR&R to ask about their current performance as well as their decision to choose CR&R over W/M.
In addition, as the suggested vendor, I might also tell W/M the contract is yours to keep IF you match the lowest bidder. As it now stands you already have the business (until the end of this year).
I personally do not enjoy twisting arms in that some major OEM’s engaged in that practice when I actually worked for a living.
In fact my editorials on that abusive industry practice by Fortune 100 firms were published in several national electronics magazines a number of years ago.
Do the math. Over the 10 year period of this contract the cost differential between the highest and lowest vendor exceeds $15 million for our residents and business owners.
Think about your vote on this pending contract and look ahead to the General Elections in Nov 2010 & 2012.
Good point Larry about calling the other city, except that the transition is in the beginning stages so that wouldn’t work right now. The problem is any one could offer a lower rate if they were planning on using 20% less equipment then is required for the job. Trust me Larry, These drivers are union and are told not to work overtime, so CRR will be doing a rush job. Plus CRR owns another company that is non-union called Jackson and they plan on using those drivers. When the union finds out what is going on there will be a lot of problems, especially with their own unionized drivers. I agree with you on the pricing issue, but at the same time safety becomes an issue when the drivers start hurrying to finish the route so they don’t get over time the streets are messy and people are at risk. They need to bid it the way everyone else is required to bid it and then they won’t be the lowest. More than likely, WM will just lower the rate. The have done a good job.
Paulie.
As I have stated several times W/M has done an excellent job.
However, we have just seen teachers being asked to take a 10% pay cut in our school district (CUSD).
There are many CA companies that are hurting big time or worse with some closing their doors. The price proposed by W/M, in IMHO, is the ceiling in any follow up negotiation, not the floor. They must be prepared to cut some of the margin out of their proposal.
I’ve written articles about business ethics but being squeezed is part of the game.
So Larry, can you update us on what happened at the council meeting this Monday in regards to trash. i heard it was a lot of discussion and then tabled to the next meeting. I haven’t watch the video and assumed you might have been there. If not no biggy. Just hate watching the whole video my computer takes for ever because it seems like it has to buffer every 30 seconds.
Paulie.
We were in the hotel swimmming pool in Palm Desert on Monday. There are times when you simply need to shut it off. When we returned to Mission Viejo just after midnight I turned on the TV only to find that the council meeting was still in progress. There must have been a lot of “trash talking.”
You can probably go to any library if you need a higher speed access and go to the city web site where every council meeting and agenda for the past year plus can be viewed.