Split Upland Council Votes To Give Burrtec ‘Perpetual’ Trash Franchise

(May 29) A divided Upland City Council this week extended the terms of the trash hauling franchise the city has with Burrtec Waste Industries to ensure that company will have an exclusive contract to handle refuse in the City of Gracious Living at least until 2026.
Burrtec has had the trash hauling franchise since 2001, following the city’s last competitive bidding process  for trash hauling services the previous year. While the original franchise contract ran for a period of three years, at the direction of previous mayor John Pomierski then-city manager Robb Quincy retrofitted it with a seven-year “evergreen” clause, which extends the contract every year by one year if notice is not given by June 30. Upon notice, the franchise is to remain in place for seven further years. Before this week’s meeting, which was held on Tuesday because of the Memorial Day holiday, the franchise was guaranteed to last until July 30, 2021. The action of the council this week conferred the franchise on Burrtec until July 1, 2026.
In return for the contract extension, Burrtec will provide street sweeping services and medical waste pick-up. The language of the contract amendment approved Tuesday night states, “The term shall be for twelve years commencing on the execution of the third amendment. On July 1, 2019, and annually thereafter, the initial term will be automatically extended for one year so the remaining term of the agreement shall always be seven years, unless either party notifies the other in writing (the “wind down notice”) before June 30 in any year that it does not wish the term to automatically extend, in which case the agreement shall terminate at the end of the term, or seven years from the date of the last extension pursuant hereto, whichever is later (the wind down period).”
The contract amendment further states that once notice is given and the wind down period is initiated, Burrtec will no longer be obligated to provide the enhanced service, i.e., street sweeping service and  medical waste disposal.
The contract amendment was worth over  $60 million to Burrtec. The city, which handles the billing for trash service, currently bills the city’s residential and business trash customers roughly $10.13 million, $5.25 million of which is paid to Burrtec, $2.22 million of which is paid in tipping fees at landfills and $2.66 million of which the city categorizes as “city program expenses.”
Members of the public  expressed doubt about the wisdom of approving the franchise contract amendment. Jack Pieri, a 40-year Upland resident who has worked in the refuse industry, on Tuesday night before the vote told the council that extending the evergreen clause to 12 years will essentially bind the city to Burrtec indefinitely. “The extension of the evergreen clause will make it difficult to interest another company to seriously consider bidding on a new contract,” Pieri said.
Councilman Glenn Bozar, who opposed the franchise contract amendment, said, “The previous city manager got us into this perpetual contract, which in the private sector world you do not do. Things like this should be put out to bid regularly. The last time this went out to bid was 14 years ago. I think this should go out to bid and we should give notice now. This is a violation of our fiduciary and financial responsibility. I cannot support this. I have no problem with Burrtec or the quality of service it provides but this needs to go out to bid for the residents to really know what is out in the market right now.”
Councilman Brendan Brandt abstained and  the contract amendment passed on a 3-1 vote with Mayor Ray Musser and council members Gino Filippi and Debby Stone in support.

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