Council Votes to Split Orcas Waste Contract with Revenue/Cost Imbalances

By  Sadie Bailey

Rather than wait until a September 25th Council Meeting on Orcas Island, County Council voted in its Friday Harbor meeting on Sept. 11th to begin split contract negotiations with Cimarron Enterprises and Orcas Recycling Services (ORS.) The decision was based on Utility Manager Ed Hale’s Staff Report recommendations for the Orcas Facility’s Request for Proposals (RFP). County Prosecuting Attorney Randy Gaylord was present to advise the Council. Also present were Public Works Director Frank Mulcahy and Russ Harvey, public works staff who served on the Orcas Transfer Station Vendor Selection Committee.

The Council voted to negotiate with Cimarron Trucking for the scale and tipping floor contract, and with Orcas Recycling Services (ORS/the Exchange) for self-haul recycling and possible options for expanded recycling and reuse services. Council Members Howie Rosenfeld and Lovel Pratt from San Juan Island expressed their misgivings with both how the contract is divided, and with voting in Friday Harbor; however, they could not effect a two-week delay in the vote.

The Orcas Transfer Station Vendor Selection committee, seeing strengths in both proposal applicants, proposed a split contract and pre-negotiations with both Cimarron and ORS to determine how the contract negotiations should be split.

The County couldn’t begin contract negotiations with RFP vendors until the new Solid Waste Management Plan (SWMP) (see article on SWMP Hearing here) was approved. After approval of the new SWMP, Council could proceed on the vote to begin negotiations with both vendor applicants for Orcas Transfer station.

Howie Rosenfeld asked where the ORS revenue stream would come from for recycling, if ORS wouldn’t be receiving tip fee revenues. He also questioned whether county staff was dictating, one way or the other, the direction of the split, and he asked how long the contract would be.

Cimarron wants a 5 year + 1 day contract with a renew option; a 5 year +1 day contract is the minimum required, if any substantial infrastructure needs to be built. Howie Rosenfeld shared his concern that “this takes ORS out of the running for the foreseeable future.”

Council member Jamie Stephens asked if the renew option for Cimarron’s contract was an automatic option. That question was left un-answered. Stephens, Rosenfeld and Pratt all said that any negotiations should divide fairly, with economic viability for both parties. Randy Gaylord said, “You can’t give all the revenues to one party and all the duties to the other.” Gaylord also informed those present that he’d be hiring outside legal help to speed things up in negotiating the contracts.

Lovel Pratt was concerned about the potentially significant costs associated with some of the other services that ORS would offer, and said that ORS’s portion of the split doesn’t balance with Cimarron’s. She questioned if the Council had identified the right dividing line between the two vendors.

Most Council members and the Public Works staff involved agreed that they thought ORS was the best long-term solution for the County’s and State’s long-term waste reduction goals. They recognized that ORS could move the waste stream toward zero waste and implement a robust reduce, reuse, and recycling plan, as well as public outreach.

Yet, most indicated they thought ORS was not yet ready for the task and that Cimarron should be awarded the tipping floor contract (scale/dump fees) for the short-term. Howie Rosenfeld disagreed, saying “The Transfer Station is not a nuclear power plant. I don’t know why the [ORS] people can’t come up to speed and operate it.”

Cimarron’s original proposal included using the existing z-wall [separating where self-haul recyclables are dumped from the Exchange property] for up to two years, and building a new z-wall closer to the tipping floor, to the west of the Exchange.

That plan was made prior to the County’s decision to offer a split contract. Council Chair Patty Miller, said, “If Cimarron has to make capital investment, they will want a longer contract. Is it possible to minimize their capital investment so that Cimarron is short-term? We do not want this contract to exceed 5 years.”

Council member Rich Peterson spoke of the intention to give ORS control of the z-wall, allowing for collection of self-haul recyclables. ORS would be a separate entity from Cimarron, and could have its own entrance, hours, and days.

When an ORS board member asked if he could respond to Ed Hale’s comment that Cimarron had experience in running a transfer station but ORS didn’t, Patty Miller, as Council Chair denied his request. She said later, “I honestly do think ORS is our best long-term solution, but they’re not ready yet.”

In response to Council concern regarding the Staff Report’s division of revenues and responsibilities/costs, Frank Mulcahy suggested that grants would be available for staff to train volunteer docents for ORS.  Lovel Pratt cautioned the County not to count on grant monies being available.

Regarding community outreach, the Council agreed to direct Staff to make it the responsibility of whoever operates the tipping floor and scales (the collection/disposal part) to fund public outreach and education with part of its revenues.

The Final Staff Report recommendations (before the above-mentioned adjustments) can be read here:
https://sanjuanco.com/Docs/CAgendadocs/09-11-2012/Discussion_Orcas_RFP_Update_091112.pdf

Howie Rosenfeld voiced his strong dissent to Staff’s recommendations. “ORS is not being given a chance,” he said. He repeated that the decision to give the revenue-generating aspects to Cimarron would make it impossible for ORS to generate the funds for infrastructure to start services such as composting and glass processing. He asked that Council delay the decision for two weeks until September 25th. He said, “we’re making a decision for Orcas Island, and we’re having our next meeting there.

“Local control hasn’t been given its due.” When voting time came, Rosenfeld said, “This decision should be made on Orcas, and I will not support it.” Randy Gaylord thought there would be no problem with waiting a few weeks to make the decision, but Frank Mulcahy pressed for immediacy, reminding Council that San Juan Island’s RFP proposals are due on October 1, and are much more complex than Orcas Island’s RFP.

Although Gaylord reiterated that waiting two weeks (Until Sept. 25 Orcas meeting) would not create a problem, Richard Fralick moved and Rich Peterson seconded a vote, that  “staff negotiate economically viable contracts with Cimarron Enterprises and Orcas Recycling Services that includes a division of services as modified in the staff recommendation with the addition of adding under A. (Cimarron Enterprises) a new #3: “Help fund community outreach services;” staff should conclude contract negotiations in time to allow for a transition of site operation by December 15, 2012; staff may choose to reallocate some services if deemed necessary to avoid service interruption; approval of this motion is subject to satisfactory review of any outstanding legal issues that have not yet been addressed to date relative to past lawsuits.”

The Council voted to adopt the motion by 5 to1 and instructed staff to begin contract negotiations with both parties; Cimarron for the scale and tipping floor contract, and ORS for self-haul recycling and continuance of the Exchange, with options for expanded services.

Those Orcas citizens present were told that Orcas Islanders would be given an update on how negotiations are going, on the Sept. 25th meeting. That meeting is scheduled to begin at 10 a.m., location TBA. Public Access time will be in the morning, starting around 10:30 a.m. After the contract(s) are negotiated, there will be a Public Hearing and then a final vote to adopt the contract(s).