AN ORDINANCE authorizing the CEO/General Manager of Seattle Public Utilities to execute an amendment to the contract with Waste Management of Washington, Inc., for waste disposal and transportation services; amending Ordinance 125207, which adopted the 2017 Budget, changing appropriations for Seattle Public Utilities; and ratifying and confirming certain prior acts.
No knock on doors. All right. Council Bill 11 8931 is the solid waste disposal contract amendment. It would discount the current solid waste disposal rate by $2 per ton in 2017 and 2019 and another $0.50 per ton in 2021 to 50 starting in 2021 based on the proposed discounts. This would result in savings of $8 million from 2017 to 2023. Santa Public Utilities proposes to use the contract savings to support cash financing of the Solid Waste Fund Capital Improvement Program. And importantly, the result would be a reduction in the projected three year average anticipated annual rate increase from 4.4% to 4.1% and a 3/10 of a percentage point difference. The amended contract itself delays by five years. The city's previously negotiated opportunity to end the waste management contract. There are two options available to Espoo as the 2019 opt out date approaches. Option one is to do what has has been done pursue, pursue savings in lieu of opting out of the contract or option to open the contract and develop a request for proposal for garbage disposal services. Espoo has done some market research and determined that Seattle's price and services are competitive or better than most other local agreements. In addition, a significant negotiated discount would put Seattle far ahead of other jurisdictions. The $8 million negotiated discount delivers near and mid-term savings, as mentioned earlier, and maintains essential service, reliability and social and environmentally performance. Social and environmental environmental performance that would not be delivered with a rushed RFP in a constrained market. Let's see what else are high points here, but a lot of speaking points. I don't think I need to go through all of them. The there are significant concerns with with moving forward with a an RFP at this time. I believe Councilmember Johnson has an amendment that would relate to having additional notice for in a situation similar to this. And I'll let him speak to that. Councilmember Johnson. Do we need to have the bill in front of us, sir, before I talk about my amendment? It's already in front of us. It came out of committee so it doesn't have to be moved on the dais. That sounds good. So Councilmember Herbold is correct. I brought an amendment with me that should be in front of all of you. We're going to call that, I guess, amendment one. There are three elements to this, as we were doing a little bit of research. The law department suggested that we add some language to one of the recitals that clarifies that the savings associated with the city service payments are related to the solid waste fund as opposed to other lines of business that you may be in. But the other two, whereas clauses here relate to the two. I think main issues that have come up in the course of our review of this particular contract, the first of which is the timeliness of getting the contract to us. So one recital effectively asks us to notify the chair of the Civil Rights, Utilities, Economic Development and Arts Committee, or the appropriate committee should should the committee not have that name the next time around prior to a decision to amend or bid out the long haul waste disposal contract? Then the second recital effectively clarifies that the council would have a preference to an open public procurement process beginning in 2021 as a means of encouraging more competitive bids to benefit the ratepayers. So those two issues that we I think heard a lot about from folks during the process hopefully reiterates the council's intent to really make sure Aspo gets this to us the next time, a little bit more early. And then secondly, asks us for you to commit to a public procurement process in advance of the next contract. So that's my amendment that I brought forward. I'd happy answer any questions that folks might have and would ask for my colleague support. So procedural has been moved it's been council member Johnson's amending council bill 118932 by amending the second and third recital and by adding a fourth and fifth recital. Is there a second? Okay. Any more discussion just on the amendment piece? So on the amendment, all those in favor of Councilmember Johnson's amendment vote I. I oppose the ayes have it. So now we have an amended bill, and Councilmember Herbold is present at the majority opinion. Do you have any more comments on that? And we'll move back to if you'd like. Let's see here a couple of other things. The Seattle Public Utilities Market Review highlighted that significant service problems with other vendors would need to be addressed if service transitioned. Service reliability is fundamental for city garbage to operate effectively and meet regulatory requirements. Waste Management has maintained a record of highly reliable service, especially compared to other vendors and jurisdictions. For example, Seattle Public Utilities suffered no significant interruption and disposal continuity this winter, even during severe winter conditions and ice storms that wiped out rail and highways. However, Snohomish County has had ongoing periods during multiple months of major service gaps, with piles of garbage remaining at county transfer stations. One of the things that was mentioned was the state of the art methane capture system that a another service provider offers. Waste Management's landfill also has a similar system. The company uses the captured gas to generate close to 13 megawatts of green power, which is sold to Seattle City. Light Waste Management is expanding this facility, bringing the capacity to around 20 megawatts of green power. Thank you, Councilman Herbold. I'll present the minority opinion, I guess, since I raised it and likely to be zero for two on amendments today. But that's okay. You get three or four times at bat to get your average up. That was a joke, by the way. Okay. So I made the minority opinion sort of clear that I think one of the worst things that can happen to a legislative body is when a department comes to you, which is sort of like a fait accompli, that we really don't have much of an opportunity to weigh in on policy preferences. And I think you heard testimony that it would be really nice to look at what new technologies out there, what new competitors are out there, how we might be able to keep this this solid waste in the state in a union facility as an example, and produce the methane and look at how this can benefit our state as a whole. And I didn't think we were afforded that opportunity. I in fairness to the utility, I am positive that they negotiated well and in good faith to protect our city and our ratepayers and to accomplish the savings that obviously this legislation has within it. So I don't doubt that at all. However, it would seem to me that based on what I know about procurements, in fact, there's a a think tank, the Center for American Progress Action Fund, that in 2015 reviewed when cities and when municipal municipalities should use procurement process and clearly found that that price alone should not be a driving factor. And they talked about how just because a competitor may be able to to to provide a price that is attractive, there's so many other criteria that should be considered, such as what we just did with our keystone, looking at the values, looking at where what our vision of a city is. And so I just think that our job is to look at all of those possibilities, and I just don't think we were afforded that opportunity. I think Councilmember Johnson's amendment makes that point, and that's why I'm very supportive of that. And again, I just you know, it was sort of flagged to me listening, talking to labor advocates and environmental advocates that we might have missed an opportunity here. So for that reason, I won't be supporting the legislation and life goes on. And I know we're looking very stringently at the utility in its operations, working with the utility and I think we have a great utility, but I think we missed an opportunity here. And so for that reason, again, I will be voting against it. Councilmember So on. Thank you, President Harrell. I voted yes on this legislation in committee and since then, many members of the labor movement, including the leader of the labor movement in Seattle, King County, Nicole Grande, have brought it to our attention that there were some issues. Council President Harrell went over some of them, so I won't repeat it. But just to quote Larry Brown, the leader of the machinists who said the city, it'll be good for the city to examine other options for long haul waste disposal. And so I will be changing my vote to a no vote. Just one other point I would add is the Republic executives who have been here are vocal against this legislation. We hope that you will support the unionizing effort at your recycling plants. Thank you. Councilman Swanson. Any further comments from any of my colleagues? Customer Horrible. Do you have any closing remarks? Good, everybody. Okay, so we have a bill in front of us in a minute, Bill. So please call the roll on the passage of the amended Bill Herbold II. Johnson Suarez. O'Brien. Hi, Serrano. Burgess. Hi. Gonzalez. Hi, President. Harrell. No. Six in favor. Two opposed. Thank you. The bill passed and Cher will sign it. Okay. Is there any further business to come before the council? I'm sorry, Bearing. Then we stand adjourned and everyone have a great day.