Due to court ordered mediation, a proposed new deal between Waste Management Inc. and the city of Jacksonville provides Mayor Peyton another opportunity to settle the dispute over the Trail Ridge landfill. The legislation implementing this tentative agreement has been introduced as City Council bill 2010-0217. The Concerned Taxpayers of Duval County continues to oppose any agreement between the two parties that circumvents competitive bidding and there is nothing in this new agreement that indicates that the Mayor’s Office is any more committed to competitively bidding the garbage landfill contract than it was when its first negotiated agreement with Waste Management was rejected by Jacksonville City Council.

See below past President John Winkler’s commentary on the landfill question.

It doesn’t take knowledge of rocket science to operate a landfill. Whatever Waste Management (WM), Republic/Southland, or anyone else in the garbage disposal industry may want the people of Jacksonville and their City Council to believe, spreading out household trash and covering it with dirt really is something that anyone able to operate a dump truck and bulldozer can do. While it may or may not be the kind of civic duty Jacksonville cares to perform using its own employees, there is nothing so special about the creation of a thousand-layer trash pile that it can only be done by giving exclusive rights to do so to one outfit, without competitive bidding, for the next thirty-five years.

Wait, you say, is this a rerun column? The whole “bid the landfill” vs. “Waste Management Forever” debate was fought out last year, you remember, and won by the forces of light when City Council rejected the Mayor’s no-bid, 35 year, $750 million contract extension on running the Trail Ridge dump, right? Didn’t the City then leap at the chance to litigate with Waste Management if need be in order to establish our right to either build our own trash mound or have the low bidder do it? Yes, that happened, but suddenly there’s a new deal proposed by the Jacksonville General Counsel that is a whole lot like the Mayor’s old deal. Call it landfill redux, deja vu all over again, or lipstick on a pig – no matter how you slice the new proposed landfill contract, it’s still (at best) last year’s baloney. Unlike last year, however, there is no time for a deliberative process at City Council. The new proposed contract (Ordinance 2010-217) demands City Council accept it by April 30, 2010, as presented, with no changes allowed.

When a group of us at the Concerned Taxpayers of Duval County (www.jaxtaxpayers.org) sued the City last year to get a ruling that Jacksonville had to either bid out a contract this huge or do the work themselves, we pointed out several legal problems in the Mayor’s tentative agreement. One provision of that proposal (still available for review at www.coj.net under Ordinance 2008-538) was an illegal clause which could have, under certain circumstances, forced the sale of the entire thousand acre Trail Ridge landfill site, and an adjacent “borrow pit” (dirt mine) site, from the City to Waste Management without any competition. Another illegal aspect of the earlier version of the no-bid contract under state law was that it could have gone on for an indefinite period of years, since it defined WM’s right to spread garbage in terms of tons (42 million) rather than time. Interestingly, the proposed contract now thrown in front of City Council avoids these two problems by leaving out the bargain land sale provision and defining a maximum number of years that Waste Management will have the exclusive right to run the City’s landfill(s). The new proposal essentially allows no more than ten years as the period WM would have been running the existing landfill before it would have been full, another 19 years for WM to operate any expansions or new landfill, with another possible six year extension “upon mutual agreement.” Not, in my opinion, coincidentally, this potentially 35 year agreement is the same length of time as the estimates on how long the Mayor’s earlier proposal would have run.

While the Concerned Taxpayer suit has been in abeyance since the Mayor’s proposal was withdrawn, the very serious issue of whether City Council has the right to waive the requirements of the City Procurement Code and proceed to give WM the exclusive right to operate any City dumps far beyond the scope of the 1990 bidding process remains undetermined. We had hoped that City Council would retain the spine it grew last spring, see the WM litigation through trial, and obtain a judicial confirmation that the City does, in fact, have the right to seek competitive bids for landfill operations once WM buries another 5 to 7 million tons at Trail Ridge. Unfortunately, City Council President Richard Clark, without waiting for either a financial or careful outside legal analysis of the new proposal, has already opined that it “makes good business sense” to avoid further litigation; this was one of the Mayor’s old arguments, unanimously rejected by the City Council less than a year ago. Perhaps the less impulsive members of City Council will take note of the following flaws in the new proposal and reject (or ignore) Ordinance 2010-217 as a poorly conceived, badly executed plan to deprive the taxpayers of the benefits of fair and free market competition.

For example, I question what this language, in section 5.2 of the new “take it or leave it” proposed contract means: “Annual Adjustment of Fee. On July 1 of each year, the then current rates shall be adjusted by a factor which shall be the product of one (unity) and a decimal fraction equal to 0.70 times the preceding twelve-month change in the Consumer Price Index (CPI), said change being expressed as a decimal fraction.Adjusted rates shall be the product of the then current rates and the modifier and shall be expressed correct to the nearest whole cent ($0.01).” The CPI required by the contract is the CPI-W, which currently stands at 212.544 using 1982-4 as a base of 100.

To explain, let’s say inflation is three percent in the first year of the contract. On July 1, 2011, the new CPI-W is 218.920, or a change of 6.376 when “expressed as a decimal fraction.” If that is what the proposal means, then 0.70 times 6.376 is 4.4632 and the “product” of “one (unity)” and 4.4632 is 4.4632. On the other hand, is the change supposed to be the percentage, to be expressed as “.03,” which leads to an adjustment factor of .021? In either case, if “the modifier” (not otherwise defined) is the same as the “factor,” the result is absurd. The “product of the then current rates and the modifier” is either $10.58 per ton of regular trash in year one times 4.4632, or $47.22 per ton in year two, or $10.58 times .021, or $0.22 per ton. If there is no change in the CPI-W, then WM works the next year for free, under either interpretation of the adjustment factor. If prices go down in year one, the second year price becomes negative; does anyone seriously believe that Waste Management will pay the City for the privilege of burying our garbage?

Obviously the drafters of the new proposed contract, in their haste, used the word “product” when they meant “sum” and the word “modifier” when they meant “annual adjustment factor,” and they should have spelled out that the annual adjustment is going to be 70% of the annual percentage change in the CPI-W (assuming that is what they meant). This is the same kind of incredible sloppiness in drafting contract language back in 1991 that created the present litigation between the City and Waste Management over what that contract really means. Is this really the best that a battery of well-paid lawyers can do? Disclosure: although I am a lawyer, no one has paid me a dime for any of the work I’ve done or am doing in connection with the landfill.

One more example of the lurking disasters in the proposed contract should suffice. Section 5.6 calls for the City and Waste Management to “use reasonable efforts” to come to an agreement on using Waste Management to recover recyclables from the “current waste stream,” but if they can’t agree, “CITY shall be entitled to competitively bid the establishment and operation of such an operation.” [Yes, it really is written that way] The very next sentence says Waste Management “shall have the exclusive right to operate any such new technology requested by the City.” So the City can bid out the recycling operation but only Waste Management can run the equipment. Is it so hard to envision another lawsuit brought by WM against our town if it tries to actually use a different company to pull recyclables? Count I: failure of City to use reasonable efforts to negotiate in good faith. Count II: request for injunction against the City,violating WM’s exclusive right to operate new technology at Site.

Alas, while I am confident that this exposure of the gross ineptitude displayed by the City’s lawyers in drafting the second “no-bid landfill contract” will result in more changes, I am not so sanguine about the City Council just doing the right thing, letting the 1991 landfill contract run out in five to seven years, and then either running Trail Ridge with our own local employees or bidding out operations on shorter contracts.

Last year WM’s competitors made lots of noise about how they could beat the Mayor’s deal if allowed to bid; this year they are (so-far) strangely silent. But the citizenry needn’t be silent. Call and email all 19 City Council members. Sign the petition at http://www.ipetitions.com/petition/bidtrailridge . Attend the City Council meetings April 12 and 26 to encourage your elected officials to do the right thing. Already the City’s solid waste disposal “fee” is being raised because it is less than the cost of collection. If the public doesn’t make the City restrain those costs by preserving competitive bidding, all of us and our descendants will be paying the price for decades to come.

John Winkler, Attorney

Videos sponsored by the Jacksonville Young Democrats on the landfill question:

Video 1
Video 2

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