WILMINGTON, MA — Last week, the Wilmington Board of Selectmen voted 4-1 (McCoy in opposition) to support Town Manager Jeff Hull’s decision to amend the town’s current contract with Russell Disposal to have the town pay 100% of its recycling costs beginning in October. (The town is currently paying up to $50 per ton. It currently costs $94.50 per ton to recycle, with Russell Disposal absorbing the difference.) The town taking on the full burden will allow Russell Disposal to stay in business long enough for the Town of Wilmington to go out to bid this November, award the bid in December, and have a new trash and recycling contractor begin at the start of the next fiscal year in July 2020.
“I wish I could come in and give you good news. This is the third time I’ve been here on the trash contract. It’s a 10-year contract. We’re entering our [fifth] year on it,” began Woods. “The world of solid waste is a very difficult one at this time in the world, United States, Massachusetts and Wilmington. …The costs for recycling are escalating beyond most people’s imagination. When we started this contract 4 years ago, we were actually getting 5 cents a ton for recycled goods. Currently, the bill we just received a couple of weeks ago is $94.50 a ton to get rid of it. That’s going to be the new norm, I’m afraid.”
“We had high hopes when I was in here last year with an amendment to the contract to keep the contractor afloat. We all hoped things would at least level off at that point or get better,” continued Woods. “Things have gotten worse and there’s no silver lining in sight. I’ve talked with my counterparts in various communities and everyone who has gone out to bid over the past 2-3 years for solid waste has seen huge increases – 30-35% increase in 1 year. Boston, for example, just went to $75 a ton for $125 a ton.”
“Unfortunately, Russell Disposal has come back to us, telling us about his losses and is looking at severing our contract and the other communities he serves,” explained Woods. “We talked about how we could do this in an orderly manner. The Town Manager and I have come up with a tentative agreement with the contractor to pay the current rate of up to $50 on the recycled goods and, starting October 1, we’d pay the full freight…. With that amendment of the contract, that would take us nine more months out. In the meantime, the town will go out to bid, get a new contractor, and probably see even higher costs, unfortunately based on the bids we seem coming in in other communities.”
“It’s now more expensive to get rid of recycling than it is to get rid of trash,” concluded Woods. “In the Commonwealth, recycling is mandatory. It’s legislated…. I personally feel it’s the right thing to do, but now it’s also the very expensive thing to do.
“We’re literally between a rock and a hard place,” added Town Manager Jeff Hull. “Russell Disposal has advised us about their inability to sustain their operation unless Wilmington and other communities assume the full freight of the disposal cost for recyclables… I’m recommending we make an amendment to this contract where would pay full freight, remain with Russell through June 30, 2020, and in meantime, go through a bid process and obtain another contract. What that will do for us? Anticipating a new contract will be significantly more – potentially a 35% increase – in FY20-21 budget, we’d be able to account that and make a serious adjustment in operating budget.”
Hull noted that in any new contract with a new trash and recycling, Wilmington will have to pay the full freight of recycling.
“There’s no way getting around paying full freight,” said Hull. “By making this adjustment, getting us through Fiscal Year 2020, we can account for the new number in the budget, then I’d propose an article at Town Meeting to seek authorization to extend the contract from 3 to at least 5 years…. The longer the contract, it’ll have some cushioning effect on our costs… This is not a good situation. We’re trying to make the best of a difficult situation.”
“We owe [Russell Disposal] a little over $525,000 on the current barrels,” Woods reminded the board. “If we were to terminate, we’d have to pay them off immediately. We’d have to pay even if Russell files bankruptcy, according to Town Counsel. Instead, Russell has agreed to allow us to pay them off on the agreed upon schedule over the next six years.”
“We’re paying $95,000 a year to pay down that debt,” added Hull. “Even when we severe the relationship in June 2020, we’d continue to pay $95,000 for the next 5 years. We wouldn’t have to come up with $525,000 all at once.”
In response to a question from Selectman Greg Bendel, Woods noted that the town will keep its current barrels, stating the town’s next contractor — whomever they will be — would have machinery that’s compatible with the barrels.
In response to a question from Selectwoman Jomarie O’Mahony, Woods explained why the town can’t force Russell Disposal to honor their contracts.
“If they just file bankruptcy, our contract would cease,” said Woods. “My biggest concern is — besides water and sewer – the biggest thing my department does is trash and recycling. A [bankruptcy] would hurt everyone in town. Trash would pile up. It would take 4-5 weeks to get someone in here in an emergency situation and that company would demand an expensive, multi-year, no-bid contract. “(Towns do not need to go out to bid for trash and recycling contractors.)
“We aren’t alone in going through this. There’s forces larger than us at play. Communities across the country are scrambling on this,” said Selectman Jonathan Eaton. Eaton noted that Andover is reducing the types of recyclables it will collect. Billerica is now going through residents recycling on the curbs, checking for compliance.
Town Manager Jeff Hull stressed that the state needs to provide cities and towns with some sort of relief when it comes to trash and recycling costs.
“Recycling is the right thing to do, but we can’t just say recycle when communities are in the predicament that we’re in,” said Hull. “There has to be some sort of assistance and help from the state and DEP. What is their long term game plan?”
“I’m from the old school when a contract is a contract is a contract,” stressed Selectman Mike McCoy. “I have serious reservations now relative to this [recommendation]. It’s amazing that it costs more money for recycling than trash. We’re almost better trashing everything… I get that the state puts this mandate on us and where the ones who pay for it…. [After the town’s last contract amendment], I would have hoped Russell’s management would have gotten their act together.”
Woods responded that Russell’s service has been “very good” and their management “hasn’t done anything wrong.”
“Russell loads up their truck, takes it to the Murph, and the Murph used to say we’ll give you a nickel for each ton. Now the Murph says you owe $94.50 for each ton. It’s the nature of the beast,” said Woods. “Russell claims to have lost $500,000 last year.”
In response to a question from Selectman Kevin Caira, Woods said that Russell Disposal will file for bankruptcy if Wilmington and Walpole (it’s other big customer) fails to amend their contracts. And with bankruptcy, trash and recycling will stop getting picked up for a temporarily period. Woods said amending the current contract will actually save the town money compared to having Russell Disposal go bankrupt and the town find an emergency replacement. Woods also guaranteed that the town’s next contractor, beginning in July 2020, will cost the town significantly more money than the current contract, possibly as much as 35% more.
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