One of the biggest surprises – and announcements – from Mayor Tom Henry’s State of the City address had little to do with city government at all.FORT WAYNE – In just more than 90 minutes, months of research and debate were dismissed.
Amid confusion and “smoke,” the City Council not only rejected a proposed seven-year garbage disposal contract with National Serv-All but also the efforts of a committee that worked on the contract since early this year.
Councilwoman Karen Goldner, D-2nd, served on that committee and said many of the questions raised at the council table were already hashed out by the committee, which reached the compromise presented to the council.
“It called into question the whole point of having the committee,” she said.
The council voted 5-3 Tuesday against the disposal contract with Serv-All but overwhelmingly approved contracts with the company for recycling and garbage collection and recycling disposal.
Opponents were concerned by the length of the proposed disposal contract and its vulnerability to fluctuating fuel prices.
Although the committee reached consensus on which contracts to support, Councilwoman Liz Brown, R-at large, had raised many of the same concerns to the committee that council members raised Tuesday in opposing the contract.
The vote came after Gregg Walbridge, president of a potential competitor to Serv-All, discussed his plans for opening a new landfill in Allen County.
Goldner said it was unusual to let a company that didn’t win the bid speak, but it wasn’t unprecedented. She said the council should always come down on the side of hearing from too many people but that doesn’t mean the council should believe what everyone says.
“I think there was a lot more smoke than light added by their presentation,” she said, while noting it is possible the proposed landfill will never come to fruition.
The contract discussion became so muddled that Councilman John Shoaff, D-at large, tried to amend the contract – an action not allowed – and Councilman Tom Didier, R-3rd, nearly voted against the wrong bill during the votes.
Didier on Wednesday said he plans to speak with city officials about the contract before the council’s final vote next week. He said he could still be swayed but said it would take a good sell by the city.
His biggest concern is that 30 percent of Serv-All’s disposal contract is based on fuel prices. This means if diesel prices double, the contract would increase 30 percent. Didier said prices are more likely to go up than down, though he added the dire projections made by Walbridge were “fictitious.”
Bob Kennedy, city public works director, said the contract accounts for the volatility of the fuel markets. Using estimates based on the past five years, the per-ton rates in the Serv-All contract would not surpass what the city is currently paying for five years.
The contracts together are estimated to save the city $300,000 next year and lower residents’ monthly garbage bills by 24 cents. Didier, however, said he is more comfortable with a shorter contract for the disposal, though longer contracts on the other services are fine because they aren’t as reliant on fuel.
Going with a shorter, three-year contract would increase the city’s costs. The per-ton garbage rates would jump by a quarter, forcing the city to pay about $25,000 more a year to dispose of residents’ trash.
This additional cost would be paid with no guarantee there would be competition for the service in a few years. Serv-All was the lone bidder on the disposal service this year.
David Kohli, Northeast Partnership chairman and garbage committee member, said he would have preferred signing Serv-All to a 10-year deal because the prices are so good. Kohli, who works in the commodities industry, said fears of fuel spiking 200 percent are unfounded – such a spike would mean pump prices of $7.50 a gallon.
Kohli said he plans to lobby Councilman Tom Smith, R-1st, who represents his area of town and also opposed the longer contract. Kohli said he is “disappointed but not surprised” by the council’s actions, but he is hopeful he can explain that these issues were already addressed by the committee.
“By shortening the contract, you are going to have to increase the costs,” he said.
