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Request for Council Action Date: June 20,2006 Item Number: � 2, Department Approval Manager Approval Agenda Section Item Description: Recycling Update Bac�C�ro�ci The City Council agreed to begin using Eureka Recycling for collection, processing and marketing of recvclables beginning December 26, 2 005. Since the switch over partici�ation rates and tons collected remain very �i�l�. Additinnally Eureka has had preliminary discussions with the City about expanding the amount of materials collected to include hard cover books. The contract with Eureka also includes a t�rovision for splittin� the revenue from the sale of material S01 S0. The City's revenue share has averaged more than $7, 300 a month —that is higher than anticipated. _ ,� ..-.__.. � Eureka is committed to recycling materials at their highest and best use. Highest and best use is a term in recycling meaning materials collected are recycled into new products that can eventually be recycled again. For instance newspaper Eur�ka collects is sold to a newsprint manufacturer that makes it into new paper that is sold to newspapers for use in printing new editions of the paper. Some haulers will sell some of the newspaper they collect to insulation manufacturers. Use of old newspapers as insulation is considered recycling because it is manufactured into a new product although the paper cannot be collected and recycled again. Thus the paper is not recycled at its highest and best use. Typically to recycle material at its highest and best use requires the recyclables to be of high quality and free of contamination; that often means it can be sold for a higher price. Eureka has sold all the glass it collects to Anchor Glass in Shakopee — the region's only glass bottle manufacturer. Anchor Glass is currently is bankruptcy reorganization. One of the factors affecting its bottom line is an increase in operations due to higher energy use. Glass recycling saves significant amounts of energy because glass cullet melts at a lower temperature than the raw materials used to make glass. However, the amount of recycled glass Anchor receives has dropped by more than half in the past five years. It has turned off one of its two furnaces and has, as of May 1, di��nued.]iu�ing.gr�n�lass and three-color mixed�lass. Eureka has secured a temporary market for a port�o�z of its green and mixed glass and is w�t�ck��i:i n� the rest. Eureka has let the City know that if this temporary market expires, it will be unable to market all of the green and mixed glass from Roseville. Section V. 2, of the contract between the City and Eureka stipulates the next steps inracP a �nm,z,ad�ty becomes commercially unviable: Lack of Adequate Market Demand: If the Contractor determines that there is no market for a particular recyclable or that the market has become economically unfeasible, the Contractor sk�a�� zmm�diately give written notice to the City. Said notice shall include information demonstrating the effort the Contractor has made to find market sources, and the financial information justifying the conclusion that the market is economically unfeasible. Upon receipt of said notice, the Contractor and the City shall have 30 days to attempt to find a feasible market. During this period the Contractor shall continue to pick up the particular recyclable.