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Page 3 of 5 Cart Ownership 59 Option one, vendor owned carts 60 The City received a very favorable proposal for the vendor owned cart option from Eureka 61 Recycling. They appear to be recovering approxim ately 50% of the cost of the carts in the five 62 year contract option. They also maintain and ro llout the carts to reside nts within their proposed 63 fee. In the Foth analysis the vendor owned cart in the five year contract option is $0.16 per 64 month less than the city owned car t option. The city would not ha ve to fund cart purchase from 65 reserves and bear the lost revenue from interest earnings from the reserve funds with this option. 66 This was not factored into the Foth analysis. With the carts owned by the vendor they carry the 67 risk of industry change of collecti on methods rather than the city. 68 Option two, city owned carts 69 Some cities have bought their own garbage and recycling carts. Ca rt rollout and maintenance are 70 handled by private companies. Ot her cities cite cost savings and creating a level playing field for 71 future bidding as the main reasons for city owned carts. 72 Cart manufacturers guarantee their ca rts for a minimum of 10 years. 73 Roseville has joined the join t purchasing cooperative HGACBuy wh ich would allow the City to 74 make a bulk purchase of carts at a pre-negotiate d group rate. Previous vendor-provided pricing 75 information indicated carts would cost appr oximately $46-56 each including assembly and 76 distribution. Prices on HGAC buy begin approximately $3 per cart cheaper. The total cost for 77 cart purchase is estimated to be approximately $600,000. The higher price was what was used 78 by Foth when it conducted the cost analysis. Accord ing to that analysis th e five-year cost with 79 the City owning the carts is $0.16 per month per resident more expensiv e that if the vendor 80 owned the carts. This additional cost is near ly $150,000 over the five year contract. The also 81 does not recover the entire investme nt in the carts over the life of this contract in this analysis. 82 Ramsey County has a grant program that the ci ty would be eligible for $100,000 of assistance 83 toward cart purchase. This was not factored into the Foth analysis as we learned of the eligibility 84 after the analysis was completed. 85 According to Finance Director Ch ris Miller, the City could purc hase the carts using reserves 86 from the Recycling account and an internal loan th at would be amortized over a five year to ten 87 year period. With city owned carts the proposers s hould have a level playing in bidding the next 88 contract. The City should reali ze a cost savings to apply toward its investment in carts although 89 there is no guarantee this will happen. 90 If the Council elects to purchase carts the process will need to commence soon. Purchasing and 91 deploying carts will take a significant amount of tim e. Cart manufacturers have told the City, 92 whether the City or the C ontractor orders the carts, to expect it to take 8-10 weeks from the time 93 of order until the carts are deliver ed. Assembly and delivery can ta ke another 4-6 weeks. All the 94 carts will need to be delivered to residents before the next contra ct goes into effect on January 1, 95 2014. 96 Added Value 97 Eureka Recycling is offering two significant items to add value to the contract. First they would 98 offer more help conducting zero waste events sinc e City staff will no longer be available to 99 coordinate zero waste activities. Most significantly they are offering to partner with the City and 100 the Rotary Club of Roseville to make Taste of Rosefest a zero waste event. These zero waste 101 activites would be included in the offered price. 102