Whatever the Killeen City Council decides regarding outsourcing of municipal trash services, it will have a major impact on the city and its residents.
The city received four outside proposals for Killeen’s solid waste services last month, and those proposals are under review by a city staff evaluation committee.
Sometime later this month, the proposals will go before the council for consideration — and members will subsequently decide whether to outsource the city’s services, and if so, move forward on awarding a contract.
The process is proceeding smoothly to date — and that’s to be commended.
It’s a far cry from last December, when a consensus vote to put the service out for bid resulted in a testy, emotional exchange, with one council member decrying the move as a “slap in the face” of the city’s solid waste employees.
The chief concern was that some or all of those employees could lose their jobs if an outside company were to take over the city’s operations.
Another concern was that the city would lose the revenue generated by the department if the service is contracted out.
Fortunately, the city’s request for proposals, sent to potential bidders, addressed both those concerns.
First, the city asked bidders to provide a path to hiring for the department’s 87 employees, which would go beyond a contractor only “considering” the employees for employment. That’s key.
Second, the city would require a contractor to pay a 9 percent franchise fee to the city’s general fund as part of its agreement. That fee is currently paid into the city’s general fund by the solid waste department. And under an alternative plan that would include curbside recycling, the proposal calls for the contractor to pay the city $10,000 monthly in recycling sales fees on top of a 9 percent franchise fee.
That’s a steady, predictable revenue stream.
Obviously, these terms must not be too unpalatable, as the city drew responses from four interested respondents — with home bases as far away as Houston and the United Kingdom.
Clearly, solid waste collection can be a profitable enterprise.
With the city facing a projected budget shortfall over the next 20 years — a revenue gap that could reach $50 million — it’s essential that the council look at every angle in examining the outsourcing issue.
To his credit, City Manager Ron Olson has worked hard to bring greater efficiency and profitability to the city’s solid waste department — and the results have been impressive.
Still, it stands to reason that large outside companies have greater economies of scale, making it possible that they can provide the same services at lower cost, or additional services — such as curbside recycling or more frequent pickups — for the same cost the city now pays.
Other local cities, such as Harker Heights, Nolanville and Copperas Cove, contract out their solid waste services, with good results. If Killeen turns its service over to an outside firm, not only could the rate-payers reap the benefits, but the city could as well.
Right off the bat, the city would save on salaries, benefits and insurance, as well as vehicle costs, maintenance costs and fuel.
Meanwhile, the city would still receive the 9 percent franchise fee, and potentially another $10,000 monthly if they opt for a plan that includes recycling.
From a budget standpoint, at least, this certainly sounds like a win-win.
Just as importantly, if the city does choose a plan that adds recycling, it will lessen the impact on the Temple landfill, where Killeen’s refuse is taken after pickup. That will extend the landfill’s lifespan and help the Central Texas environment.
When the issue of outsourcing solid waste first came up last year, several council members contended that city staff generally opposed the idea and couldn’t be counted on for an impartial evaluation of bid proposals.
Hopefully, that was not the case. Council members must have a straightforward, objective evaluation of each proposal in order to make an informed decision on whether to outsource — and which bidder to choose if they do.
It’s also important that the bidders don’t have undo influence before the council decision is made. As such, it’s heartening that the proposal calls for no ex parte communication between city staff and bidders during the review process.
Certainly, the city’s solid waste department should have the opportunity to match any proposal by outside companies.
But Killeen residents deserve to have the best service they can get for the money — including recycling. If that means going with an outside provider, so be it.
The council could schedule a vote on outsourcing solid waste before the May 5 city election. If so, it may be the defining vote its current members will make.
Indeed, it’s a complicated issue, with several factors to consider.
But ultimately it comes down to doing what’s best for the city and its taxpayers.