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Accusations traded over routine waste disposal contract

Monday, April 15, 2013 by Michael Kanin

Council members Thursday approved a contract with Allied Waste Services for the company to handle a selection of class 2 non hazardous Austin Energy waste. By the time the 5-1 vote was recorded, however, the agreement was about much more than waste handling.


Over two Council debates, a Zero Waste Advisory Commission hearing, and loads of behind-the-scenes back and forth with staff, Allied and competitor Texas Disposal Systems – who until Thursday held the AE waste deal – leveled allegations of impropriety with regard to the procurement process conducted by staff. It was enough to delay a vote on the matter once. (See In Fact Daily March 8)


In the end however, Council members awarded the contract to Allied, as staff recommended.


Council Member Laura Morrison was the lone ‘no’ vote on the deal. During Council debate, she expressed fears that an agreement would allow Allied to extend the life of a landfill it is supposed to close in 2015.


After the meeting, she echoed those concerns. “Considering the city’s history, that in fact just a few years ago, our legal staff signed an agreement on the life of a landfill that directly conflicted with an explicit Council resolution, and that the City Manager has the authority to modify the Rule 11 agreement without Council approval, I believe it’s prudent to maintain the concern that the extensions in this contract could lead to an extension of the life of the landfill,” she said in an email to In Fact Daily.


The Allied landfill has had other issues. In the late 2000s, when the facility was still operated under the name BFI, that firm went around Travis County Commissioners Court – and against regional wishes – to expand the landfill by order of the Texas Commission on Environmental Quality.


Now owned and operated by Allied Waste, the facility is set to close in November 2015. Allied’s deal to process the AE waste would expire on October 31, 2015. By then, staff hopes to have the deal wrapped in to the city’s master waste contract – a move that would coincide with the shuttering of the Allied landfill.


However, the Allied contract also contains language that would extend its handling of waste beyond that date. Contrary to Morrison’s worries, the company insists that it will close the landfill no matter the status of the contract. The AE waste, they say, would be handled by another Allied facility in the eventuality that the deal needs an extension.


The agreement had proved controversial at the Zero Waste Advisory Commission meeting. There, members eventually concluded that they should recommend the deal with the caveat that it should not contain any extensions. Chair Rick Cofer voted against the agreement entirely. Commissioner Daniela Ochoa Gonzalez abstained.


Also, at the March Council meeting, Texas Disposal Systems questioned the integrity of the city’s bidding process. Though the company admitted to an error on its part – something that occurred when it failed to submit the two operative pages of its bid – TDS representatives insisted that Council members should consider the complete document, and that it would save the city a substantial amount over the Allied bid.


Texas Disposal attorney Michael Whellan continued to hit the city on its procurement process. “Mistakes here have been made by the bidder and by city staff in a failure to synchronize city policy,“ Whellan said. “Ultimately, the public process – what we’re doing today, voting on contacts – is the opportunity, the checks and balance that exists in our system that you make sure that bidding, city staff review, and ultimately contracts are synchronized with city policy.”


Whellan went on to suggest that an award of the AE contract to Allied would go against the city’s zero waste efforts. As part of that argument, he stressed that Texas Disposal reuses some of the waste produced by Austin Energy, and that Allied would not.


Further, Whellan argued that Allied had failed to complete its own bid for the contract when he said that the company overlooked a relatively small section of the sheet.


Allied’s Lee Kuhn countered that the company had in fact responded to that portion of the bid. He also leveled his own accusations at the city. “My company met all the rules and provided a complete bid,” Kuhn said. “We’re concerned that the integrity of the bid process would be lost if this (item) is rebid.”


Texas Disposal had called on Council members to force city purchasing to rebid the project.


Local politico Mark Littlefield also represents Allied. After the meeting, he turned back to a remark made by Council Member Bill Spelman during the March debate. “My favorite quote was Council Member Spelman’s from last month,” Littlefield said, “’I don’t think $40,000,” the figure that Texas Disposal argued it would save the city if awarded the contract, “is worth our integrity.”


For his part city purchasing officer Byron Johnson was circumspect. “I think it’s a case of where both of them are doing what a lot of companies would,” he told In Fact Daily. “They both want the contract. They obviously see the value in the contract and so a lot of the rhetoric is, again, just trying to get what they hope is a position point that will get them the contract at Council.”

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