Pulaski County officials are renegotiating the last six months of their contract for most county recycling services and are considering increasing their payment to the contractor by more than a half-million dollars.
The contract covers curbside recycling in Little Rock, North Little Rock and Sherwood, although the county's three other cities and the unincorporated area also would see an influx of money during those six months.
The renegotiation also includes a possible increase of $1 per month for curbside recycling customers in those cities -- from $2.99 per month to $3.99 per month -- starting April 1 until March 31, 2021. That would be a two-year contract extension.
The cost to customers is increasing nationwide as recycling becomes less and less profitable, according to the district's executive director, Craig Douglass.
The Regional Recycling and Waste Reduction District -- a state solid waste district that operates only in Pulaski County -- and contractor Waste Management have not disagreed over whether to increase the monthly price to customers by $1 starting April 1. The new contract also will not include glass recycling, unlike the current one, but it's unclear when that would go into effect.
The groups are deciding how much to increase the recycling cost for the next six months, beginning Oct. 1, and for how many years to extend the contract. The district is also requesting $5,000 per month from the company for recycling education.
Douglass said the current contract allows for three years of extensions and doesn't require a new bidding process. He said the district hopes to continue the contract another two years. Waste Management had been transporting glass elsewhere for recycling because of issues with breaking it down at Recycle America, its material recovery facility in Little Rock, Douglass has said previously.
Ideally, the agreement with Waste Management would cover both the renegotiated final six months and the contract extension, said North Little Rock Mayor Joe Smith, a district board member. But to do that, city councils must approve contract changes and the extension before Oct. 1. That means the district and the company must agree soon.
Waste Management officials could not be reached late Tuesday afternoon.
Waste Management has proposed increasing the cost of recycling by $1 per month per customer during the final six months of the current contract, from Oct. 1 through March 31. Earlier, it had proposed only a 70-cent increase.
Smith said he would like to see the 70-cent proposal again. That would cost the district roughly $524,000, which it could find in its reserves rather than charging it to customers. The district has an annual budget of about $1.2 million and reserves of about $1.1 million.
Douglass and district Deputy Director Carol Bevis noted that the district will lose money in the coming years because of the loss in electronics recycling grants, the cost of recycling tires versus the amount the district will receive from the state for doing it, and the loss in landfill tipping fee revenue because of another solid waste district's decision to take its garbage to another county.
Douglass said the district may use its remaining electronic recycling fund money to build up its electronics program, and some of the reserves are earmarked for electronics. The district currently receives about $250,000 in electronics recycling grants annually and about $100,000 per year in tipping fees from the other solid waste district.
The district's board includes the mayors of the county's six cities -- Little Rock, North Little Rock, Sherwood, Jacksonville, Maumelle and Wrightsville -- and the county judge.
Because the funds for the first six months would come from reserves that are meant for the whole district, the district board decided that the remaining cities and the county should get the same price increase per month per household during the coming six months. That's what would bring the total to about $524,000 at a price increase of 70 cents per household per month.
The district does not otherwise pay for the recycling program. Rather, its role has been to facilitate the contract for it.
The price increase would offset Waste Management's cost of decontamination and cost of recycling, which is less lucrative now than it was when the company first took over the cities' curbside recycling in 2012.
For the past few years, China, a large purchaser of U.S. recyclable goods, has banned certain materials because the shipments are too often contaminated with nonrecyclable materials.
Waste Management has reported high amounts of contamination -- nearly 40 percent -- among the three cities for years. Recycle America, owned by Waste Management, will send contaminated recycling to the Two Pine landfill, which Waste Management also owns and charges Recycle America for using.
While the company's headquarters in Houston projects lower recycling revenue for 2018, it does not project such a loss in its garbage business, according to a U.S. Securities and Exchange Commission 8-K filing from July. For the past two years, landfill revenue has increased as recycling revenue has declined, according to the company.
Most of the contamination comes from plastic bags, Douglass said. Kroger bags, Walmart bags and Arkansas Democrat-Gazette plastic sleeves for its newspapers are the bulk of the problem in Pulaski County, County Judge Barry Hyde said.
Kroger announced last week that it would begin to phase out plastic bags by 2025, and Douglass said he contacted the company's Memphis regional office to see if the process can begin soon in Arkansas.
Plastic bags aren't allowed in recycling because they get tangled in the machinery at Recycle America, which converts the recycling into bales to sell.
"If there are plastic bags in a recycling cart, there's a possibility that that whole cart will end up in the landfill," Douglass said. "So, yeah, good recycling material is spoiled by material that can't be recycled."
Contamination in May 2017 was 37 percent among the three cities, Douglass said. It was 32 percent in May 2018, but Douglass said he could not confirm whether it was a trend without knowing what the rates were for other months. He said he hoped it was a trend, because the district has been increasing its educational outreach.
"It starts with the consumer, with the customer," Douglass said.
The district wanted to use tags to notify customers that their recycling bins were contaminated, but Waste Management asked the district to discontinue a tagging program after an audit period until the company replaces its recycling trucks with manual side loaders. In those trucks, workers must attach the recycling carts to the side loader themselves, which allows them to see inside the cart for contamination.
Metro on 08/29/2018