Annapolis Can Save $7 Million By Privatizing Trash Collection

| March 11, 2012 | 1 Comment
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The City requested bids from four contractors and a recent report highlights the enormous savings the City can expect by privatizing the service.  Of course, the one unknown issue is the service levels. Currently, the City has absolute control over their employees and can easily handle any missed calls or refuse issues that come up. With a private contractor, the City will be at the mercy of the contract.

Some startling numbers from the report comparing the City handling the refuse on a once a week basis and a contracted service include:

  • By switching to a once per week collection by City personnel, there will be a $750,000 per year savings.
  • By switching to a once per week collection by contracted personnel, there will be a 1st year savings of $1.2 million and annual ongoing savings of $1.7 million per year.
  • The total cost to run the current program (2 collections per week) for 7 years by the City is $25.6 million.
  • The total cost to run the modified program (1 collection per week) for 7 years by the City is $20.42 million.
  • The total cost to run the modified program (1 collection per week) for 7 years by a contractor is $13.9 million.

While the presentation states that privatizing the service will result in 20 layoffs, it is unclear if the cost savings for these layoffs is included in the savings.  Regardless, the City has an opportunity to negotiate a $7 million windfall.

The Council is scheduled to vote on this May 21, 2012 with a proposed implementation date of July 1, 2012

 

 

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