Trash talking on Monday night helped reduce the tax hike Orillia homeowners will face in 2020 - at least for now.
City councillors have asked staff to go back to the drawing board in the wake of the “very bad news” received Nov. 26 when the tender for the city’s new waste collection service was unveiled.
On that day, on the eve of the city’s budget deliberations, it was learned that the new contract was almost double the previous contract, coming in with a price tag of about $2.2 million per year.
Because the current contract expires June 30, that inflated deal would result in an unexpected $528,000 increased hit to taxpayers in 2020.
On Monday night when it came time to ratify this year’s budget, Coun. Tim Lauer said such a hit was not acceptable.
He, with the aid of a majority of his council colleagues, won support to ask staff to reduce that $528,000 to $350,000. That would allow the tax hike in 2020 to be reduced from 3.88 to 3.58%.
“I understand staff is looking at all kinds of options in regards to this contract and providing this service,” said Lauer.
“I am suggesting there should be some alternatives ... and I’m suggesting we set that number at $350,000 to establish our expectations that we can do this in a more efficient manner.”
After the meeting, Andrew Schell, the city’s director of environmental services and operations, said staff have been reviewing the two proposals they received. Seven companies participated in the tender process, but only two made bids.
The “lowest” bid, at $2.2 million, came from the city’s current provider, Orillia’s Mid-Ontario Disposal.
Schell said all options are on the table. He said they could “potentially re-look at the previous contract” and seek another renewal or try to negotiate a better deal.
He said staff will also investigate the option of providing the waste collection service internally - without using an outside contractor.
“The hope is that somewhere with all our decision making and all our research, we’ll be able to come up with that reduction,” said Schell.
He added: “I can’t say I have confidence” that a lower price can be negotiated.
He said a move to in-house collection is being carefully considered. However, it would be costly - up front. Schell said the trucks, alone, are worth about $400,000 and seven are needed.
“Many smaller municipalities do it,” Schell noted. “Obviously, there are a lot of options being considered.”
The new contract, if consummated, would be an eight-year pact with two options to extend it by one year.
Schell said he believes the current contract also started out as an eight-year deal and has been extended by a year twice.
After the meeting, Lauer said the “negotiation process” is a normal component of a tendering process. He said he is “hopeful” a better deal can be reached.
“I’m just hoping saner heads prevail and, on our end, we work things out and save some money,” said Lauer.
He said he has talked to staff and they “think it’s worth exploring. We haven’t accepted anything yet. What I’m hoping for is ... they find a way to work with our expectations and carry on.”
If, ultimately, the price tag comes in above $350,000 the remainder of the money to pay the bill would likely come from the tax rate stabilization fund, which is used to fund one-time, unexpected costs.
