Core Services Hit Market Wall

Sometimes the most important developments, like significant cost increases in snow plowing, and garbage and recycling collection, happen under the cover of a pandemic and a hot summer. Last month was one of those times.

Garbage and Recycling

The last time household garbage and recycling services were tendered was in 2010.

Last winter Council approved a new tender, a Request for Proposals (RFP), for a new contract that would reduce pollution and increase reliability by having contractors use newer equipment, and change garbage routes to improve resident service. The lowest proposals came back with a 60% increase over the current budget.

Other neighbouring municipalities have also seen large increases. Larger companies, often multinationals, making up for loss-leader bids that were used to eliminate local competition and an industry-wide lack of qualified drivers and operators are two of the reasons for increased cost. A lack of definitive provincial action on producers being responsible for the garbage their products produce (producer responsibility) has also created huge uncertainty in the sector.

Rather than accept a 60% cost increase Council cancelled the RFP and negotiated a three-year contract with the current providers. The result is a 15% increase over current costs with a cost of living increase. It will now be at least 13 years since the garbage contract was tendered. It is like having an in-house department but run by permanent contracted staff.

Snow Plowing

Last year Council extended a contract with Mulroney Trucking for one more year of snow plowing without going to tender. Staff commented that there is the possibility of “other service delivery options” and that tendering results in other municipalities indicated that our best deal would be a contract extension.

This year staff again recommended extending Mulroney’s contract, but in what seems like a “chickens coming home to roost moment”, Mulroney trucking wanted a significant hourly increase and the addition of a $500 per week stand by charge per truck: a fee the Township has not previously paid though it is standard in most neighbouring municipalities. With no time left to implement other options before snow season Council accepted a 12.5% increase in costs for the remainder of 2020 and an estimated cost increase of 36% in the 2021 budget.

In-House Delivery Option

In the discussions on both the garbage and recycling contract and the snow plowing contract a commitment was made to bring forward alternative delivery options, including more in-house or Township delivered services.

In-house delivery of these core services would increase the Township’s flexibility to adapt to a rapidly changing regulatory environment, climate change and evolving resident needs without expensive renegotiation of private contracts. It also removes the Township from a market dominated by large corporations which have the resources to bid low to gain contracts then increase the price in subsequent bids when local contractors have gone out of business and the capital costs of new ones starting are prohibitive.

The Township has a long and mostly positive history with local contractors but going without tendering the work for larger contracts is a violation of international agreements. As the Township grows these tenders will attract the attention of bigger corporations, and they will have a right to bid.

In-house service delivery allows the Township to avoid the need to tender and keep the work local. There is no guarantee that in-house services will be cheaper, but they will allow the Township to have greater control over reliability and pollution abatement desired by residents, as well as provide for pay, benefits and working conditions that will benefit local employees. Township services keep the Township’s money local, either in terms of lower taxes, or better wages and working conditions, with none going to external management or investor payments.

The Township needs to consider bringing a group of services in-house to allow for the hiring of more permanent part-time and full-time staff.

The discussion on how to deliver Township services is urgent and will affect not only those services, but the shape of the Township’s budget and the well-being of our community. Please pass along your comments on this pivotal decision.

COVID Thank You

Thank you to everyone for mask wearing to help reduce COVID infections and for shopping local to strengthen our small businesses. It makes a positive difference in our community.

About Ross Sutherland

retired nurse, researcher, public health care activist.
This entry was posted in Uncategorized and tagged , , , , . Bookmark the permalink.

1 Response to Core Services Hit Market Wall

  1. Steve says:

    I agree that bringing ih house the work is better. It can be more work for local people and they can spend it here. While it may cost some more it’s worth it. The Township then has control of the various jobs. Also, on a different note, I think that moving some of the “Ploice” services in house should be looked at before the next OPP contract comes up. Use the OPP for “crimes” but have issues that don’t require a gun done by a municipal force. Speeding being one.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.