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Regular City Council Meeting Monday, February 08, 2010 Page 30 f. Discuss a Recycling Contract Extension Recycling Coordinator Tim Pratt briefly summarized the proposed Recycling Contract Extension with Eureka Recycling, for a two year term through 2010, with favorable terms for the City and allowing for competitive collection rates. Mr. Pratt sought City Council direction, opining that this was a good offer. Discussion included increased rates, representing atwenty-three percent (23%) increase during the current contract term, based on holding off on rate increases for several years by using revenue share monies and reserves, and this proposed rate serving to build up City reserves in addition to addressing current costs and reduced market of recycled materials. At the request of Councilmembers, Mr. Miller advised that the overall contract represented an approximate fifteen percent (15%) increase over a four year pe- riod. Further discussion included initial incorrect billing for multi-family rates due to the contractor misreading the specifications and miscommunication between staff members, and costs for multi-family recycling significantly higher, but not passed on to the citizen, but paid for form reserves; and funding of the program from in- creased user fees, SCORE grants, and other funds. Additional discussion included projections of revenue sharing and marketability of materials and potential impact to rates, with proposed contract language on the extension more sustainable over the long-term and eliminating "floors" for paper and aluminum recycling markets and materials, changing them from Chicago to Minneapolis-based indexes. Councilmember Ihlan clarified the intent in staff's recommendation to extend the contract versus going out for bids, was that actual service costs would not be re- duced, and that this presented a better option for the City; and staff provided comparative and current collection charges, and city processing rates for other haulers (i.e., Waste Management and Allied); noting that Eureka initiated and was the only bidder originally providing the revenue sharing option and creating this market that was now becoming standard practice among other haulers. Councilmember Pust addressed this proposed contract extension in lieu of the City's recently adopted professional services contract policy. Councilmember Pust outlined staff's rationale in their recommendation, along with the City Coun- cil's rationale in changing the policy for bidding out contracts to provide the most transparency and most favorable deal for its citizens. Councilmember Pust opined that, if this was the best option for the City, going out for bids would only serve to prove that to the public.