19-3101 Accepting Commercial Solid Waste Consolidation Study

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City of Casselberry May 9, 2019 Page 4 of 12 Many cities and counties in Florida have opted to implement an exclusive franchise system for commercial refuse collection. Under an exclusive system, haulers compete to be selected as the single private hauler to be awarded the right to provide services to all commercial businesses within the City. The exclusive franchisee is subject to performance requirements and has service rates established through the competitive procurement process. It is critical to note that an exclusive provider will be able to route its collection vehicle(s) in a highly efficient manner, which not only reduces the truck traffic and the inherent side effects, but also reduces the unit cost to serve individual businesses. If a city has competitively procured an exclusive franchise hauler, all else equal, the rates to customers should be consistently lower than the rates paid in a non-exclusive system. Methodology MSW Consultants performed the following steps to complete this analysis: ♦ Policy and Regulatory Research — MSW Consultants reviewed the City ordinance, franchise agreements, and related Florida State Statutes and provided a synopsis of considerations for review by the City's legal counsel. ♦ Comprehensive Plan Review - The City's Comprehensive Plan was reviewed and found to contain an excellent, detailed section on solid waste management. This commercial consolidation study is in line with Objective SW 5, Fiscally Responsible Solid Waste Services. ♦ Service Level Compilation — MSW Consultants compiled the city-wide inventory of refuse containers in service through its franchisees, including number, container size (95 -gal cart through 30 -yard), container type (dumpster or roll -off), and collection frequency. This inventory provides a clear picture of the level of effort needed to service the City under non- exclusive and exclusive franchise systems. ♦ Financial Analysis — MSW Consultants validated the current reported franchise revenue and franchise payments made to the City under the current non-exclusive system. ♦ Pro Forma Analysis of Exclusive Commercial Collection — Using industry standards and a proprietary company collection system model, MSW Consultants projected the routes, collection trucks, direct employment, estimated cost to customers, and estimated franchise fee payments to the City, for both a non-exclusive and exclusive commercial collection system. System Details ♦ Current Franchise Haulers — Table 1 below summarizes the ten current franchise haulers and indicates which container types they report collecting. As shown, all franchisees provide roll -off collection, and six of the ten provide frontload/cart service. MSW Consultants does not employ attorneys and cannot dispense legal advice. However, MSW Consultants did provide background and technical perspective relevant to the legal considerations.