While Republic, Rizzo and City Council settle contract chaos, we outline need-to-know points of the dispute

What we know about Flint’s erupting waste controversy

Flint, MI has been in the news for many reasons in 2016, though the recent ongoing dispute over the city’s waste contract may the hardest story to follow yet.

Republic Services has been collecting Flint’s waste since early 2013. The decision to continue with Republic Services or start a new contract with Rizzo Environmental Services first came before the Flint City Council in June. While eight of the nine council members supported Republic, Mayor Karen Weaver and the ninth member supported Rizzo.

Since June, this dispute has led to collections being temporarily canceled, calls for a state investigation, a public records lawsuit, multiple legal motions by elected officials, an attempted termination of Republic’s temporary contract, one day where both companies were collecting the same routes and much more.

Republic currently has a temporary contract to continue collections until Nov. 11. Genesee County Circuit Judge Joseph Farah has signed a temporary restraining order preventing Weaver from hiring Rizzo or ending Republic’s agreement. Farah required Weaver, city officials and council members to report to court yesterday and for the rest of the week until an agreement can be reached.

In an effort to clarify details around contract costs — the main point of contention — Waste Dive spoke to both Rizzo and Republic about information their bids contain. Republic also provided a Sept. 13 memo which was sent by the company’s legal counsel to Derrick Jones, Flint’s purchasing manager, for further information.

Mayor Weaver’s office could not be reached for comment. Councilman Scott Kincaid, who has been a leading proponent for Republic, could also not be reached for comment.

Terms and costs

According to the memo, Republic, Rizzo and Emterra Environmental USA submitted bids for a five-year contract with the city in the spring. The city administration had these bids evaluated by three officials: Purchasing Manager Jones, Transportation Director Kay Muhammad and Waste Services Coordinator Heather Griffin. They evaluated these bids between late May and early June based on multiple factors. Republic and Rizzo received the same score for cost, but Republic came out on top with a total of 80 points. Rizzo received 76 and Emterra received 69.

Republic bid $19.52 million, Emterra bid $18.51 million and Rizzo bid $17.42 million. Weaver backed Rizzo as the “lowest responsible bidder,” citing the $2 million difference as the main factor in a city with dire financial constraints.

“We’re offering a $2 million savings over five years, over the next lowest bidder,” Joseph Munem, director of government affairs at Rizzo, told Waste Dive. “‘Lowest responsible bidder’ is a very narrowly defined descriptor, of which we are.”

Republic and the eight council members dispute this claim.

“There really is no $2 million savings with Rizzo,” Gary Hicks, municipal services manager for Republic told Waste Dive. “When you read the city’s own purchasing ordinance and you look at the bids that were submitted you find that Republic is the lowest responsible bidder.”

Republic’s Sept. 13 memo argues that Rizzo’s bid was “deficient in several ways” due to multiple factors.

Landfill access

The city’s invitation to bid requested that the selected hauler allow residents with a city permit to dispose of up to one ton of debris for free at their landfill. According to a cover sheet in the memo, dated May 5, Rizzo noted that its list of services “does not include free dumps for residents.”

Based on an assumed value of $35 per household, Republic says its landfill service is worth $1.34 million annually. The company argues that, in fact, this makes their bid less expensive.

“It is a true differentiating factor between everyone that bid,” said Hicks.

Rizzo argues that it is now willing to offer unlimited bulk pick-up.

“Why in the world would anybody want to load up stuff in a truck and take it to the dump when we’re going to pick up from them at the curb?” said Munem. “This is a specious argument.”

Republic told Waste Dive it will also offer unlimited bulk pick-up at the curb.

Providing a blight plan

The city asked bidders to provide a blight remediation plan for dealing with large amounts of illegal dumping and waste from abandoned homes.

Republic proposed dedicating a collection truck and crew full-time to working with Flint’s blight elimination division. The truck would have special identification and the crew would have special uniforms. Hicks says this was inspired by challenges crews currently face because they can’t enter private property to collect illegally dumped items. Republic hopes that advertising this truck’s special status and coming through neighborhoods regularly will encourage residents to bring their waste to the curb instead. City officials valued this at approximately $155,000 per year, though Republic argues that its true value is approximately $238,000.

Rizzo’s original bid offered two 40-yard roll off containers per month at an estimated value of $12,000. The company has since said it would also include a clam truck and rear-load packer, along with staff. As Republic’s memo notes, the city’s purchasing ordinance doesn’t allow for bids to be altered or corrected once submitted. Rizzo says the change was a clarification as requested by the city, and not a modification. Rizzo also notes its experience dealing with illegal dumping in Detroit as another reason why it has the better plan.

“This is a fantasy that Republic is selling,” said Munem. “By offering that clam truck and also by picking up bulk items unlimited we are offering the only truly significant blight remediation.”

Ripple effects of the lead crisis

Based on these two factors, Republic argues that the true cost of each bid is different than has been reported.

“While Rizzo’s base pricing is slightly lower, this is not surprising for a base bid that is missing several minimum bid requirements,” reads the memo.

Since this process began in June, the city and council members have gravitated toward negotiating a contract for three years rather than five. According to Republic, when free landfill access and blight remediation are factored in it has the lowest bid for either timeframe.

For a three-year contract the company says that its total bid would be $11.59 million as compared to Rizzo’s $11.89 million. For a five-year contract, using this logic, Republic’s total bid would be $19.52 million as compared to Rizzo’s $22.12 million.

This question of which bid is in fact lowest matters more in Flint than most other cities. The city is still under the guidance of a Receivership Transition Advisory Board and is dealing with major infrastructure costs and consequences related to lead-tainted water.

Weaver cited this as the reason for her stance at a town hall meeting on Sept. 28.

“If you want to know what I’m fighting about, some money, I thought about $2 million for more lead service line replacement, and $2 million is a lot,” said Weaver, as reported by East Village Magazine. “I don’t know why nobody’s mad that they [Republic] have been charging us $2 million more.”

While the majority of council members disagree with this reasoning, Rizzo sides with the mayor’s connection to the lead crisis.

“You have an irresponsible City Council that is in a power struggle with the mayor,” said Munem. “One would think that responsible elected officials would be looking to find every spare penny to sink into resolving that problem.”

Hicks noted that Republic played a large role in assisting with the recycling of water bottles by increasing collection frequencies and other services.

“We continue to go out every day and try and provide the best service for the residents of the city of Flint that we can,” he said.

Waste Dive will update this story as the situation develops.

Top Image Credit: jv1953