The Fresno, Calif. City Council approved a 10-year extension for Sunset Waste Paper’s five-year contract to process the city’s recyclables. The vote was held Feb. 27th, and came in favor of Sunset by a vote of 5-2. (See Earlier Story)
The contract will allow all the residential and commercial recyclables collected by the city to go to the new facility.
John Mohoff, general manager of Sunset, said the arrangement is a big win for the city. The bid by Sunset Waste Paper was half as expensive as the next closest bid. And, with the extended length of the contract the savings to the city could be even greater. Along with the 10-year extensions, the city also has two five-year options to extend the contract with Sunset.
According to a staff report, the original contract required the city to pay Sunset Waste a processing fee of $15 per ton. The contract included a profit-sharing provision, leaving the city with a net cost of $12 per ton. If terms of the new deal had been in place for the past 19 months, according to the staff report, the cost per ton to the city would have been $7.10. The total savings to the city would have been about $218,000, according to local press reports.
At the council's direction, consulting firm Hilton Farnkopf & Hobson negotiated the contract extension. Sunset Waste officials had asked for a 15-year extension, saying they needed the extra time to get more favorable financing for their new $7.7 million recycling center in west Fresno.