Banking, garbage bids set by city
by DAVID DAVIS, Managing Editor
Jun 27, 2013 | 934 views | 0 0 comments | 33 33 recommendations | email to a friend | print
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Santek Environmental lost its bid to wrest the garbage contract away from Waste Connections of Tennessee while Bank of Cleveland took the city’s banking services away from BB&T.

Bank of Cleveland will provide banking services for the city, Cleveland City Schools and Bradley County E911 Emergency Communications District.

Bank of Cleveland won the bid by offering a rate based on 100 percent of the federal rate adjusted on a quarterly basis with a guaranteed floor rate of .125 percent.

BB&T offered a rate based on the federal fund rate minus .025 percent adjusted annually with no guaranteed floor rate.

No fees were included in either bid.

The Cleveland City Council approved a banking services contract with BB&T at its May 27 meeting. They opted to re-examine the bids and rescinded the vote June 10. The Council approved an impromptu motion by At-Large Councilman Richard Banks by a vote of 5-1-1. Second District Councilman Bill Estes voted no and 1st District Councilman Charlie McKenzie passed. That vote came after Bank of Cleveland Senior Vice President Christy Griffith complained of the decision based on what she believed was inaccurate information provided to Council members.

Waste Connections will continue hauling city waste another five years. The new contract, effective Jan. 1, 2014, does not provide for an option to extend the contract.

The city bid policy worked to its advantage by saving $321,000 a year over the five years of the new contract. The cost per household will decrease from $6.77 per month to $5.93. The Council will determine in the 2014 budget if the savings will be passed to consumers or transferred to a capital fund to reinvest in equipment for bulk trash pickup.

“We saved city taxpayers $1.5 million over five years by putting this out for competitive bid,” At-Large Councilman Richard Banks said. “Allowing the competitive bid process to work ought to be the flagship of everything we do in the future.

Waste Connections Municipal Marketing Manager Doug McGill offered in November 2012 to forego a price increase in 2013, if the city exercised the option to extend the contract five years. The cost the company charges is tied to the Consumer Price Index published annually. The CPI adjustment would have been 2.49 percent. According to McGill, not taking the adjustment equated to a $35,000 savings to the city this year, the final year of the contract. He argued that compounding that by six years, the last year of the contract and the five years of the extension, would give the city a cumulative savings of $210,000.

Waste Connections’ overall bid of $1.936 million was lower than Cleveland-based Santek Environmental’s bid of $2.006 million. Allied Waste, Arrow Disposal and Greenstream Recycling were listed as “no bid” on the tabulation sheet.

Waste Connections was lower on both residential and commercial pickup with bids of $5.93 per household and $1.55 per cubic yard for commercial. Santek bid $6.21 per household and $1.64 per cubic yard for commercial. Santek’s bid on commercial recycling was substantially lower at 80 cents per cubic yard compared to Waste Connections’ $1.40.

McGill said in November that the city of Cleveland had the best rate in the market area at $6.77 per month.

Banks thanked Environmental Services for pressing the Council to let the contract out for bid.

Waste Connections Municipal Marketing Manager Doug McGill offered in November to forego a price increase in 2013, if the city exercised the option to extend the contract five years. The cost the company charges is tied to the Consumer Price Index published annually.

The Council seemed poised to extend the contract at its Dec. 8 meeting until Dunson said the city is selling itself short if the contract is not let for bid.

“We want an opportunity to bid on it and based on a letter we’ve sent to city leaders and hand-delivered to them, this contract should be bid because of its size and magnitude,” Dunson said during an interview in December. “We are guaranteeing that what residents are currently paying under the current scope of work, we can meet or beat that price.”

While Environmental Services fulfilled its guarantee, it was not enough to sway the Council.