Council okays 10-year Athens trash contract, with 45 percent rate increase
by Kevin Cody
A 10-year contract with Athens Services for trash pick up, and street sweeping was approved by a unanimous vote of the Hermosa Beach City Council Tuesday night. The contract includes a 45 percent rate increase for trash pickup, spread over three years. The contract also includes an annual increase equal to the Garbage and Trash Collection Consumer Price Index, plus one percent. The Trash Index is typically two percent higher than the Consumer Price Index, which was used under the current contract, according to the City staff report submitted to the council.
The city will pay Athens approximately $720,000 annually for street sweeping and cleaning services. Residential street sweeping hours will be reduced from four hours to three hours.
The city will receive approximately $420,000 annually from Athens in franchise and administrative fees. Athens will also pay the city $100,000 at the start of the contract.
Athens Government Affairs Vice President Christian Warner told the council Tuesday night, “That 45 percent [rate increase] represents what we call the extraordinary rate adjustment that’s necessary to comply with all of these new [State] programs,” which he described as “unfunded State mandates.”
He singled out SB1383, which went into effect in January. SB1383 requires residents and businesses to discard organic waste in dedicated trash bins. The organic waste is turned into fertilizer. According to the staff report, “Processing rates for organic waste are typically 40 percent more than for solid waste.”
Warner also attributed the sharp rate increase to declining prices for recyclables, and the low rate Hermosa has benefited from since first contracting with Athens in 2010.
According to a report by the R3 Consulting Group, “The city’s residential rates are likely to remain below the average of other South Bay cities.” Athens will reimburse the city for the $200,000 cost of the R3 report, according to the staff report.
The trash and street sweeping contract was awarded without a request for proposals (RFP) from Athens’ competitors. An RFP would have cost approximately $200,000 (to be repaid to the city by the winning bidder), and taken 18 months, according to the city staff report. The staff report also noted that when Manhattan Beach issued an RFP for trash services in 2019, the winning bid was 50 percent higher than the city’s previous rate.
“I’m usually pretty wary of consultant reports saying you guys are doing a great job because who knows who’s paying who,” Councilman Michael Detoy told Warner. “That being said, I did check out the consultants… and they recommended your competitors to other cities. So by no means do I think that they are biased or slanted towards you… You guys are doing a wonderful job in the city keeping our city clean.”
Council Member Justin Massey agreed the rate increase was reasonable, but disagreed with Warner’s characterization of SB1383 as an “unfunded State mandate.”
“I’d rather pay to divert organic waste than deal with the increasing, runaway costs of climate change. Organic waste is a natural source of fertilizer… It’s an alternative to nitrogen fertilizer, which contaminates our water supplies, and is another extraordinarily expensive problem,” Massey said.
“Diverting organic waste is a cost I’m certainly willing to pay to make sure we are doing the best we can with our waste stream to protect our pocketbooks today [and] our environment in the future.”
Mayor Raymond Jackson, who was chairing his first council meeting, noted that Athens recently donated $40,000 to the city for color changing lighting along Pier Avenue, on Pier Plaza, and along the Community Center roofline.
“Athens has been a great partner for the city. Every time I turn around, there’s an Athens’ rep helping to paint, helping to clean. Other businesses could take a page out of their book to help improve our community.” ER