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Agenda 02/11/2025 Item #11A (Franchise Agreements for Solid Waste, Recyclable Materials and Yard Trash Collection Services w/Waste Management, Inc. of Florida & Waste Pro of Florida, Inc.)2/11/2025 Item # 11.A ID# 2025-340 Executive Summary Recommendation to approve and authorize the Chairman to execute “Franchise Agreements for Solid Waste, Recyclable Materials, and Yard Trash Collection Services,” with Waste Management Inc. of Florida, and Waste Pro of Florida, Inc., with commencement dates of October 1, 2027, at an average estimated amount of $32,000,000 per Fiscal Year for the first period of seven years, and with two seven-year renewal options, and authorize the Chairman to sign the attached Agreements for continuation of existing best value services. OBJECTIVE: To approve and authorize agreements that provide continued collection services for solid waste, recyclable materials, and yard trash. CONSIDERATIONS: The County has two Municipal Services Benefit Unit (MSBU) Districts (Exhibit A) that delineate the solid waste, recyclable materials, and yard trash collection service areas in unincorporated Collier County, including the City of Everglades City and City of Marco Island through interlocal agreements. Waste Management Inc., of Florida (WMIF) provides services for MSBU I and Waste Pro of Florida, Inc. (WP) provides services in MSBU II. Services include twice per week garbage collection and once per week service for recycling, yard waste, and bulk waste collection. In total, there will be over 30 million collections in FY2025, and the complaint rate remains low at approximately 0.2% over the last year. The current Agreements expire September 30, 2027, and have no remaining renewals. Given the high-value and potential public health and welfare impacts of solid waste, recyclable materials, and yard trash collection, best management practices include securing long-term contracts years prior to the expiration of the current contracts. On February 8, 2005 (Item 10.A), the Board of County Commissioners (Board) approved the current Franchise Agreements with WMIF and WP (as successor to Waste Connections of Florida, Inc., formerly known as Progressive Waste Solutions of FL, Inc.). Section 2.2 of the existing Agreements established the initial eight-year term, effective October 1, 2005, and ending on September 30, 2013, at 11:59 PM. On May 24, 2011 (Item 10.B), the Board approved the first of two seven-year renewals, effective October 1, 2013, through September 30, 2020. On May 28, 2019 (Item 11.A), the Board approved the second seven-year term renewal, effective October 1, 2020, through September 30, 2027. On October 22, 2024 (Item 16.C.5), the Board directed staff to negotiate continuation of the existing best value services for Solid Waste, Recyclable Materials, and Yard Trash Collection Services with Waste Management Inc. of Florida, and Waste Pro of Florida, Inc., and bring back recommendations for consideration. WMIF and WP actively support the Board approved Integrated Solid Waste Management Strategy with capital infrastructure and program investment aligned with the Enduring Guiding Principles to sustain environmental and growth management, airspace preservation, operational excellence, and best service value. This support is demonstrated through initiatives including, but not limited to: • Strong public/private community partnerships that support public health and safety through safe and compliant waste collection and disposal. • Guaranteed recyclable commodity management during a volatile global market. • Introduction of over 90 Compressed Natural Gas (CNG) collection fleet vehicles. • Construction of a $2 million CNG fueling station, decreasing impacts of fleet emissions on air quality in the County. • Specified liquid damages for service-related issues (FY2024 unresolved incidents: 0.2%). Page 500 of 3773 2/11/2025 Item # 11.A ID# 2025-340 • Utilization of automated collection fleet to service approximately 400,000 collections weekly. • Active contributor under two declared emergency and hurricane debris recovery missions. Aligned with the County’s strategic objective to provide services and programs that sustainably manage the County’s waste, County staff completed negotiations with WMIF and WP. The proposed terms for the new long-term agreements are highlighted below. • Commencement Date of October 1, 2027 for a seven-year period, with two-seven year renewal options • Maintain current service levels - Twice per week garbage collection and once per week service for recycling, yard waste, and bulk waste collection • Maintain all inclusive cost for residential collection, disposal, and recycling processing • Modify the Consumer Price Index (CPI) provisions for cost containment with a minimum of 2% and a maximum of 5%, using the U.S. all urban consumers CPI • Add language for bear resistant containers • Modify disaster recovery language to account for back-to-back hurricanes • With the exception of roll-off services and the residential rate, the rates were aligned to reflect market conditions using an anticipated CPI to October 1, 2027. The weighted average MSBU rate in the last year of the existing contract (FY27) is projected to be $10.82 per month. However, the negotiated rate to commence on October 1, 2027 (FY28) will be $16.00 per month. This reflects the ongoing upward pressures on costs associated with waste collection and disposal, driven by factors such as inflation, labor, and operational costs. Public Utilities financial consultant, Raftelis Financial Consultants, Inc., who specializes in public utilities financial analysis, evaluated the negotiated terms and rates and concluded the following: “Based on the survey of recently awarded contracts, the average inflation adjusted increase in residential collection rates is $8.58 per month, while Collier County’s rate is anticipated to increase $5.18 per month.” This means that despite the projected increase, Collier County’s rate remains the lowest in the state of Florida, as shown in the chart below, offering residents an affordable rate for waste collection services compared to other counties in the state. The proposed rates are a result of carefully negotiated terms that balance long-term sustainability of services while minimizing the financial impact on residents. Page 501 of 3773 2/11/2025 Item # 11.A ID# 2025-340 Source: Attachment D - Fiscal Year 2025 Solid Waste Franchise Collection Benchmarking by Raftelis Financial Consultants, Inc. FISCAL IMPACT: Franchise Agreements protect the fiscal stability of the County’s enterprise fund with specific language and limitations on annual price increases through cost containment with a historically low consumer price index (CPI) and CPI limits. The combined contract value is expected to be an average of approximately $32 million per fiscal year, for a period of seven years, with commencement dates of October 1, 2027. These expenses are funded through an annual assessment on the non-ad valorem section of the tax bill in the Mandatory Trash Collection Fund 4073. GROWTH MANAGEMENT IMPACT: Continuity of collection services is consistent with the Solid Waste Sub- Element of the Growth Management Plan. LEGAL CONSIDERATIONS: This item is approved as to form and legality and requires a majority vote for approval. -SAA RECOMMENDATIONS: Recommendation to approve and authorize the Chairman to execute “Franchise Agreements for Solid Waste, Recyclable Materials, and Yard Trash Collection Services,” with Waste Management Inc. of Florida, and Waste Pro of Florida, Inc., with commencement dates of October 1, 2027, at an average estimated amount of $32,000,000 per Fiscal Year for the first period of seven years, and with two seven-year renewal options, and authorize the Chairman to sign the attached Agreements for continuation of existing best value services. PREPARED BY: Kari Ann Hodgson, P.E., Director, Solid & Hazardous Waste Management Bart Zautcke, C.P.A, Manager Operations-Finance, Solid & Hazardous Waste Management ATTACHMENTS: 1. Exhibit A - Municipal Services District Map 2. Exhibit B - Final Agreement with Waste Management Inc. of Florida 3. Exhibit C - Final Agreement with Waste Pro of Florida, Inc.. 4. Exhibit D - Fiscal Year 2025 Solid Waste Franchise Collection Benchmarking by Raftelis Financial Consultants Inc. 5. Waste Management Inc. of Florida - Collier Affidavit 6. Waste Pro of Florida Inc. - Collier Affidavit Page 502 of 3773 G u l f O f M e x i c o - Map Prepared by Collier County IT/GIS SERVICE DISTRICTS DISTRICT I G G G G DISTRICT II 0 3 6 9 121.5 Miles 1:500,000 Collier County, Florida This map is a representation of compiled public information. It is believed to be an accurate and true depiction for the stated purpose,but Collier County and its employees make no guarantees, implied orotherwise as to the accuracy of completeness. We therefore do notaccept any responsibilities as to its use. This is not a survey nor is it to be used for design. Solid Waste Collections Scale : District I & II US 41 SR 29Marco Naples EvergladesCity LEE COUNTY HENDRY COUNTY COLLIER COUNTY MONROE COUNTY Page 503 of 3773 Page 504 of 3773 Page 505 of 3773 Page 506 of 3773 Page 507 of 3773 Page 508 of 3773 Page 509 of 3773 Page 510 of 3773 Page 511 of 3773 Page 512 of 3773 Page 513 of 3773 Page 514 of 3773 Page 515 of 3773 Page 516 of 3773 Page 517 of 3773 Page 518 of 3773 Page 519 of 3773 Page 520 of 3773 Page 521 of 3773 Page 522 of 3773 Page 523 of 3773 Page 524 of 3773 Page 525 of 3773 Page 526 of 3773 Page 527 of 3773 Page 528 of 3773 Page 529 of 3773 Page 530 of 3773 Page 531 of 3773 Page 532 of 3773 Page 533 of 3773 Page 534 of 3773 Page 535 of 3773 Page 536 of 3773 Page 537 of 3773 Page 538 of 3773 Page 539 of 3773 Page 540 of 3773 Page 541 of 3773 Page 542 of 3773 Page 543 of 3773 Page 544 of 3773 Page 545 of 3773 Page 546 of 3773 Page 547 of 3773 Page 548 of 3773 Page 549 of 3773 Page 550 of 3773 Page 551 of 3773 Page 552 of 3773 Page 553 of 3773 Page 554 of 3773 Page 555 of 3773 Page 556 of 3773 Page 557 of 3773 Page 558 of 3773 Page 559 of 3773 Page 560 of 3773 Page 561 of 3773 Page 562 of 3773 Page 563 of 3773 Page 564 of 3773 Page 565 of 3773 Page 566 of 3773 Page 567 of 3773 Page 568 of 3773 Page 569 of 3773 Page 570 of 3773 Page 571 of 3773 Page 572 of 3773 Page 573 of 3773 Page 574 of 3773 Page 575 of 3773 Page 576 of 3773 Page 577 of 3773 Page 578 of 3773 Page 579 of 3773 Page 580 of 3773 Page 581 of 3773 Page 582 of 3773 Page 583 of 3773 Page 584 of 3773 Page 585 of 3773 Page 586 of 3773 Page 587 of 3773 Page 588 of 3773 Page 589 of 3773 Page 590 of 3773 Page 591 of 3773 Page 592 of 3773 Page 593 of 3773 Page 594 of 3773 Page 595 of 3773 Page 596 of 3773 Page 597 of 3773 Page 598 of 3773 Page 599 of 3773 Page 600 of 3773 Page 601 of 3773 Page 602 of 3773 Page 603 of 3773 Page 604 of 3773 Page 605 of 3773 Page 606 of 3773 Page 607 of 3773 Page 608 of 3773 Page 609 of 3773 Page 610 of 3773 Page 611 of 3773 Page 612 of 3773 Page 613 of 3773 Page 614 of 3773 Page 615 of 3773 Page 616 of 3773 Page 617 of 3773 Page 618 of 3773 Page 619 of 3773 Page 620 of 3773 Page 621 of 3773 Page 622 of 3773 Page 623 of 3773 Page 624 of 3773 Page 625 of 3773 Page 626 of 3773 Page 627 of 3773 Page 628 of 3773 Page 629 of 3773 Page 630 of 3773 Page 631 of 3773 Page 632 of 3773 Page 633 of 3773 Page 634 of 3773 Page 635 of 3773 Page 636 of 3773 Page 637 of 3773 Page 638 of 3773 Page 639 of 3773 Page 640 of 3773 Page 641 of 3773 Page 642 of 3773 Page 643 of 3773 Page 644 of 3773 Page 645 of 3773 Page 646 of 3773 Page 647 of 3773 Page 648 of 3773 Page 649 of 3773 Page 650 of 3773 Page 651 of 3773 Page 652 of 3773 Page 653 of 3773 Page 654 of 3773 Page 655 of 3773 Page 656 of 3773 Page 657 of 3773 Page 658 of 3773 Page 659 of 3773 Page 660 of 3773 Page 661 of 3773 Page 662 of 3773 Page 663 of 3773 Page 664 of 3773 Page 665 of 3773 Page 666 of 3773 Page 667 of 3773 Page 668 of 3773 Page 669 of 3773 Page 670 of 3773 Page 671 of 3773 Page 672 of 3773 Page 673 of 3773 Page 674 of 3773 Page 675 of 3773 Page 676 of 3773 Page 677 of 3773 Page 678 of 3773 Page 679 of 3773 Page 680 of 3773 Page 681 of 3773 Page 682 of 3773 Page 683 of 3773 Page 684 of 3773 Page 685 of 3773 Page 686 of 3773 Page 687 of 3773 Page 688 of 3773 Page 689 of 3773 Page 690 of 3773 Page 691 of 3773 Page 692 of 3773 Page 693 of 3773 Page 694 of 3773 Page 695 of 3773 Page 696 of 3773 Waste Pro of Florida, Inc. 13110 Rickenbacker Pkwy, Ft Myers, FL 33913 239-872-8371 Keith Banasiak SVP / COO kbanasiak@wasteprousa.com Page 697 of 3773