Board Workshop – September 5, 2012

Bid Considerations The three main factors to consider when developing this bid are: Level and Quality of Service Low Rates SBE Participation

Bid Objective Level and Quality of Service Maintain Service Level Enhanced Fines and Penalties Highly Qualified Haulers Minimize Service Disruption

Bid Objective Low Rates Fewer Districts Lower Overhead & Less Risk Greater Competition (Fewer Service Areas than Bidders and possibly another bidder) Less Variability

Previous Bid Results

Service AreaRate Increase %UnitsRank by Size 10205%11, %4, %11, %18, %24, %1, %31, %23, %19, %18, %18,2757 Rate Increases by Size of Service Area

Residential Credit Application The current franchise agreement requires the SWA to credit the hauler for residential service based on the waste generation study. While this study has proven to be highly accurate over the years it does not allow for significant changes in waste generation due to unusual economic conditions. This requirement can result in significant uncertainty for the bidders who will likely protect their interests by increasing their bids. We intend to discuss this with the potential bidders and propose a modified credit process for the bid.

SBE Participation Impediments to higher participation Wages and benefits make up a significant percentage Minority direct hiring does not count toward the goal Subcontracting is the only way to achieve the goal, but has unintended negative consequences. Other significant costs don’t lend themselves to SBE participation (fuel, capital equipment, insurance). The SWA measure is imperfect. We recommend deducting wages and benefits and other costs where little potential exists prior to calculating the rate for a more realistic picture.

Qualification Philosophy Experience collecting solid waste and recyclables in a comparable manner and for a comparable population size. Experience must be that of the company and not the individuals – no startups or teams without experience working together. Individuals may leave. Significant scale-ups are risky. We will consider parent and subsidiary company experience.

Prequalification Requirements Bidder has a minimum of two (2) years collecting both residential and commercial solid waste and recyclables Currently providing residential service under contract to a minimum of two (2) counties/cities and of comparable size to the service area being bid on. Currently providing residential service under contract to a minimum of one (1) county/city with a minimum of 30,000 residential units, or a combination of four (4) such contracts totaling a minimum of 30,000 residential units. Currently providing commercial service of a comparable size and scope to the service area being bid on. Currently providing commercial service collecting a minimum of 200,000 cubic yards annually.

Prequalification Requirements Bidder has a minimum of three (3) years collecting both residential and commercial solid waste and recyclables. Currently servicing three (3) qualifying contracts with greater than 25,000 residential units each to qualify for up to 55% of the residential units. Currently servicing three (3) qualifying contracts with greater than 55,000 residential units each to qualify for up to 71% of the residential units. Currently providing commercial service of a comparable size and scope to the sum of the three (3) largest service areas. Currently providing commercial service of at least 350,000 CY annually.

Florida County Comparisons CountyService Areas / UnitsExperience / Units Palm Beach /92,000 (avg.) /25,000 (avg.) 2 yrs. / One contract of 30,000 units. (min.) Polk1 / 140,0003 yrs. / Two contracts of 50,000 units. Lee5 / 21,000 – 43,5007 yrs. / A current contract of at least 80% of the units bidding on. Orange5 / 40,000 each, approx.2 yrs. / One contract of 25,000 units. (min.) Or 5 yrs. / Four contracts servicing 40,000 units with two of the four concurrent. (max.)

Previous Board Consensus Reduce number of Service Areas from 11 to 4. One hauler can receive two of the three larger areas. Set commercial collection rate at $2.95 per yard. Set commercial recycling collection rate at $1.70 per yard. Set commercial recycling collection rate for 95 gallon container at $10.00 for 1x per week. Hauler allowed to keep recovered materials. We propose to change this and require that material be delivered to the Authority.

Previous Board Consensus Small commercial generators can use up to three garbage cans at a flat rate of $28 per month. Commercial compactor (VIP) collection rates at $3.68 per yard. Roll-off compactor pull rate of $185 and permanent open-top at $150. Eliminate exclusive right to collect commercial veg. Special service rate for excess residential vegetation of $9 per yard, which is a reduction from the current rate of $65 + $18 or $22 per yd.

Previous Board Consensus Bid the Glades area separately to give smaller, less experienced companies the opportunity to compete. We are currently also considering piggy-backing the South Bay contract. Remove fuel component from RRI. We are proposing a monthly fuel adjustment based on an index. Maintain records for term of contract plus one year after end of contract. Hauler will collect public drop-off containers in their service area at the commercial recovered materials collection rate.

Previous Board Consensus Increased fines: Taking waste out of the county: 1 st Offense - $500,000 We are proposing to add restitution. 2 nd Offense – loss of franchise Daily fines increased to $200 from current $100. No backup equipment fine increased to $25,000 from current $2,500. Incomplete route fine increased to $2,000 from current $1,000.

Direction Needed Modified qualification requirements for minimum and maximum award Modified SBE Participation 15% of Net revenue after deducting Payroll, depreciation and other expenditures where no opportunity for SBE participation is available Authorize staff to discuss piggybacking with Southern Waste Services for the Glades Area contract. Require all recovered materials collected under the franchise to be delivered to SWA Add restitution for lost fees to the fine for first offense of taking waste out of county Reduce the commercial recycling collection rate for 95 gallon containers from $15 to $10. Authorize staff to look into a credit modification.