Council votes to award Rizzo waste contract

By: Eric Czarnik | Sterling Heights Sentry | Published April 8, 2016

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After a months-long bidding process that frequently divided Sterling Heights City Council members, the council unanimously voted to approve a waste hauling contract April 5.

The council voted to pick Sterling Heights-based Rizzo Environmental Services as the city’s next contracted hauler for an eight-year term. The city approved the new partnership before Sterling Heights’ current waste hauling contract with Waste Management expires at the end of April. Rizzo is expected to start picking up Sterling Heights’ trash in May.

The final decision to go with Rizzo followed a series of twists and turns at the council table.

In February, the council voted 4-3 to reject earlier-submitted waste hauling bids, including one that had Waste Management as the lowest bidder on a five-year, basic service contract. Proponents of rejecting those bids, including Mayor Michael Taylor, said they wanted to seek an option that included affordable curbside recycling while making trash carts voluntary.

In March, the same 4-3 majority voted to perform a request for proposals process with waste hauling vendors and kept open the possibility of accepting an eight-year contract.

During the April 5 meeting, Sterling Heights Department of Public Works Director Michael Moore explained what happened afterward.

He said an Evaluation Committee examined submitted RFPs from Emterra Environmental USA, Waste Management and Rizzo. The committee consisted of Moore, Finance and Budget Director Brian Baker, City Development Director Denice Gerstenberg and Purchasing Manager Jim Buhlinger.

“Once the second interview was completed, it was clear that one vendor could provide the desired service at the lowest cost,” Moore said.

Moore said the city officials weighed the bids based on qualifications, experience, cost, capacity, methodology and references. In the end, the panel concluded that Rizzo was the lowest bidder on three different plans. The City Council ultimately picked the cheapest of those options, Option 1.

Under Option 1, the city expects to net about $1.45 million in budgetary savings over the contract’s eight-year term. Baker said that level of savings likely wouldn’t have been possible in a five-year contract, and he attributed additional savings to Rizzo’s agreement not to burden the city with a fuel surcharge should future gas prices rise.

Baker’s presentation also explained that the entire contract price, $33.82 million, was about $1.98 million cheaper than Waste Management’s proposal.

Although Waste Management has an exclusive contract for subscription-based recycling in Sterling Heights that is set to last into 2018, Rizzo will eventually take over curbside recycling too under its new contract.

Moore said the Rizzo curbside recycling program will become a weekly service, and while it will still be subscription-based, its yearly rate will be reduced to around $57. The city’s three existing recycling drop-off centers will remain open under the plan.

Residents may also voluntarily purchase a 64-gallon trash container for $75 or a 96-gallon container for $85, Moore said.

In contrast, the rejected Option 2 would have made curbside recycling universal and would have shut down the recycling centers. It also would have provided everyone with a recycling cart at no additional cost above taxpayer dollars already paid. Option 3 would have given residents an 18-gallon recycling bin at no additional personal expense, and it would have opened up recycling to everyone and shut down the city drop-off centers.

However, both of the rejected options would have cost more, according to a city chart.

Several public commenters at the meeting criticized the Rizzo proposal and the way that the process was conducted — or seemed to have been conducted.

Waste Management representative Patrick Greve said that even though his company wasn’t the latest low bidder, he believes that the residents appreciate the work that the company does.

“I think if you look back in the archives of this city, you’re going to find that this wouldn’t be the first time that an incumbent provider who has done a good job had been awarded this contract even though they weren’t the low bid,” he said. “I think that’s been your history. I think it’s been done before, believe it or not.”

Resident Jeff Norgrove criticized the city’s proposal process and aired concern about the campaign contributions that came from political action committees affiliated with waste haulers, namely Rizzo and Waste Management, during the City Council election in 2015.

“I’m not going to say there has been any wrongdoing, but it’s the perception of the people at home,” he said.

“I hope you clarify yourselves tonight, because it just looks very bad. And to be honest with you, with the campaign money that came in, which most of you have talked about — some other residents have talked about — to be quite honest with you, I think it violates the council’s ethics rule, and I don’t think you should vote on this because it was an awful lot of money put into the campaigns.”

In response, Mayor Michael Taylor said the contributions did not sway the decision on the matter, adding that his own reasoning came down to price and service benefits.

“Every step of this process resulted in cost savings to the residents,” Taylor said. “I’ve never once in my six-plus years on this council seen so many residents coming up and complaining about a process that’s ultimately going to save them money. Now it hasn’t been a lot (of residents). Admittedly, it’s only been a few.”

The three council members who had consistently voted in opposition throughout the bidding and rebidding process — Mayor Pro Tem Joseph Romano and Councilwomen Maria Schmidt and Barbara Ziarko — voted this time in favor of awarding the contract to Rizzo.

Ziarko said she wants to see a copy of the contract before it’s officially signed.

“It’s been no secret that I have not liked this process,” she said. “I think this could’ve been handled differently, but we’re sitting here tonight having to make a decision.”

Learn more about Sterling Heights by visiting www.sterling-heights.net or by calling (586) 446-2489. For Rizzo Environmental Services in Sterling Heights, visit www.rizzoservices.com or call (586) 772-8900.

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