broward county garbage monopoly continues

Posted on August 28, 2012 by mcooper

Score one for Wheelabrator in the latest battle of the Broward Trash Wars.

Broward commissioners on Tuesday awarded Wheelabrator Technologies a five-year contract for disposal of trash generated in unincorporated areas.

Big deal? Sort of.

Broward’s unincorporated areas generated only 11,000 tons, or about 1 percent, of the total 920,000 tons of county garbage disposed by Wheelabrator in 2011 under a long-standing agreement that is set to expire in July 2013.

For more than 20 years, the county and a consortium of 26 local cities have managed the region’s waste disposal as members of the Broward Solid Waste Disposal District — and they’ve used Wheelabrator, a subsidiary of Waste Management, exclusively for those services.

Only a handful of Broward cities, including Pembroke Pines and Hallandale Beach, do not participate in the district.

The idea was to achieve an economy of scale, but critics contend Wheelabrator holds a virtual monopoly worth billions that has allowed the company to charge Broward customers the highest rates in Florida.

During the 20-year contract period, the county and member cities paid Wheelabrator an average $65 a ton to dispose of their solid waste — in 2011, the rate hit a high of more than $72 a ton.

Wheelabrator’s current rate, negotiated about a year ago, is $57 a ton.

Now, the company is offering $42 a ton.

The steep discount is the result of several forces, including a strong push by the city of Miramar — a member of the solid waste district — to bring in competition by putting out to bid its trash disposal services contract in 2011. Miramar generated about 60,000 tons of trash in 2011, or about 6 percent of the county total disposed by Wheelabrator.

Two companies bid for Miramar job: Wheelabrator, which proposed charging $52.50 a ton; and Sun-Bergeron, which bid a fee of $45.25 a ton.

Trash fees are divided into two parts: customers pay a hauler to pick up garbage curbside, and then they pay an additional cost — called a “tipping fee’’ — to bury or burn the trash at a landfill or incinerator.

The deal negotiated by Miramar was for the “tipping fee’’ portion of the trash bill.

In March, Miramar chose Sun-Bergeron, a joint venture between Bergeron Environmental and Recycling, and Sun Recycling, a subsidiary of Lantana-based Southern Waste Systems. Bergeron Environmental is a venture of prominent Broward developer Ron Bergeron.

Wheelabrator officials protested that the bidding process was flawed and that the city provided a competitive advantage to Sun-Bergeron. The company also filed a lawsuit against Miramar, but the disposition of the suit is unclear.

Sun-Bergeron is due to take over trash disposal for Miramar beginning next July.

Before Miramar put its trash disposal services out to bid, Broward County officials had been trying for several years to lower Wheelabrator’s rates.

The last effort came as the company’s exclusive contract was set to expire in summer 2011.

Broward commissioner Ilene Lieberman, who chairs the board that manages the solid waste district, negotiated a 10-year, $1.5 billion no-bid contract with Wheelabrator which lowered rates.

But Lieberman’s fellow commissioners rejected that deal in January 2011, and directed county staff to do better.

After months of negotiations with Wheelabrator, Broward commissioners approved a two-year interim extension worth $107 million.

Just before that extension, Wheelabrator had been charging $72.57 a ton to dispose of the district’s trash. The interim agreement lowered the price to $57 a ton.

That interim agreement also led to lower rates for residents in member cities of the solid waste district, such as Oakland Park, which cut residential trash service rates by 15 percent as a result.

But as the interim agreement with Wheelabrator reaches expiration in July 2013, more member cities will decide whether to go with Wheelabrator, Sun-Bergeron, or strike out on their own to find the best price.

The trash disposal contracts negotiated by Miramar with Sun-Bergeron and by Broward with Wheelabrator allow for other cities to piggy back on their respective deals.

Read more here: http://www.miamiherald.com/2012/08/28/2972841/broward-county-chooses-wheelabrator.html#storylink=cpy
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