Second Chances

When talk turns to large cities that have embraced recycling, Chicago has not always been one that comes to mind. Greater attention toward meeting "green" goals has led many cities to embark on ambitious projects to boost recycling, often using innovative programs.

Curbside recycling in Chicago, which began a blue-bag collection program more than 10 years ago, has struggled. The city is now attempting to improve its overall recycling rate using a combination of steps.

Key to improving the city’s overall handling of solid waste and recycling is an RFP (request for proposal) that it is set to release. Although the city has yet to send out the official RFP, it already has winnowed down the list of possible bidders to seven via a request for qualifications (RFQ) that was issued this past fall.

While it is still uncertain which company will be awarded the contract, it is likely that the project will be one of the largest municipal solid waste and recycling programs to be put out for bid in the United States.

Chicago, the third most populous city in the United States, will be issuing an RFP that will grant the recipient operator status for three city-owned material recovery facilities (MRFs) in different parts of the city.

The city of Chicago’s Department of Streets and Sanitation (DSS) provides the collection of solid waste and recyclables from single-family homes as well as apartment buildings and condominiums with four or fewer units. The recyclables collected and delivered to the MRFs right now are via the city’s blue-bag program.

The blue-bag program has been the focus of significant criticism in light of the minimal amount of recyclables recovered and the generally lower quality of the material. Critics also point to the fact that blue bags of recyclables are collected in the same vehicle as solid waste in a typical pickup, resulting in broken bags and recyclable material commingling with solid waste, making the collected recyclables at times unsortable.

As a result, Chicago’s blue-bag program has a lower recycling rate than similar programs in many other cities.

Under the current contract, which has been in effect for the last five years, Allied Waste Transportation Inc. receives, processes, separates and disposes of the city’s solid waste. The contract was twice extended for two-year periods.

In the RFP that is expected to be released shortly, the city could be looking for a contract length of as long as 20 years.

As part of the new RFP, the city is considering allowing the MRFs to be operated as transfer stations, allowing third-party waste to be received at the facilities. This would be in addition to the municipally collected solid waste the facilities handle.

The three MRFs are each capable of handling more than 1,000 tons of municipal solid waste (MSW) and recyclables per day. The city’s Northwest MRF, opened in 1995, is capable of handling 1,550 tons per day, while the Medill and 34^th Street MRFs are permitted to handle 1,200 tons per day and 1,100 tons per day, respectively. All three facilities are equipped with sorting conveyor lines that have a maximum processing rate of 100 tons per hour.

The winning bidder will be granted a tax-exempt leasehold interest in the land on which the MRFs lie, as well as the exclusive right to operate the MRFs and to provide material recovery and recycling processing of the solid waste during the length of the contract.

According to the city’s figures, on average, approximately 11 percent of the collected material was recovered for recycling. Of that amount, more than half is paper. In 2006, the most recent data available, paper accounted for 42,360 tons of the total 74,340 tons of recyclable material collected.

While the RFP and final contract will likely be one of the largest available for recycling and solid waste purposes in the country, the city did draw up some requirements to ensure that the possible bidders could meet its requirements, including:

The city originally was expected to award the winning bid by early 2008, however, delays have pushed back the deadline for choosing the winning bid until possibly this spring.

According to the RFQ, once the city of Chicago determines the finalists, each will sign a confidentiality agreement and receive a confidential information memorandum providing additional information about the MRFs and the bidding process.

Upon entering the concession agreement, the operator will be obligated to pay a concession payment. The agreement bidding terms will include a tipping fee that the city will pay on a per-ton basis

The city of Chicago estimates that there are approximately 940,000 residential units serviced by DSS vehicles, which in turn deliver the collected material to one of the three MRFs.

With all this in mind, the city has narrowed down its list of prospects to some of the largest waste management firms in the country. The finalists are Allied Waste Transportation, the present operator of the MRFs; ARC Disposal & Recycling, a subsidiary of Republic Services; Fulcrum Bio Energy and Casella Waste Systems; Norcal Waste Systems; Urbaser S.A. and Transload America Inc.; Veolia Environmental Services; and Waste Management of Illinois.

The project itself appears ambitious for a city that has struggled to roll out an effective recycling program. The city’s blue-bag program, which serves most of the city’s residents, has been panned by many critics, a number of whom cite the minimal recycling levels achieved through the program, the poor quality of the material and a general malaise from the populace toward the program.

The city is considering phasing out the blue-bag program, but the concession agreement will require the private operator to continue to process and separate the municipal solid waste under the blue-bag program until the city notifies the firm that it plans to discontinue the operation.

While Chicago’s blue-bag program has been criticized, the city is undertaking a second project that it hopes will make its recycling goals attainable.

In regard to recycling, the city of Chicago has begun a pilot recycling collection program using 96-gallon blue containers. This program is limited to only seven of the city’s 50 wards, with two other wards being partly included in the single-stream container program. However, the city recently announced that it would expand the program to offer the recycling carts in additional wards throughout the next several years. Despite some initial success with the single-stream program, budget cuts have resulted in the scaling back of expansion plans.

Chris Solvay, with the City of Chicago’s Department of Sanitation, notes that the single-stream program began with a very small pilot program that included 700 households in April 2005. Beginning in 2007, the program was expanded to its current coverage area.

A grant from the state of Illinois helped to fund the initial purchase of the 96-gallon containers.

Solvay says currently more than 80,000 households take part in the single-stream collection program. The program has been successful, with recovery levels exceeding those achieved through the blue-bag program.

Despite budget cuts, Solvay says Chicago will further expand the single-stream pilot program this year, adding that he expects the city will continue to add more wards to the program during the next several years.

He estimates that last year around 13,500 tons of recyclables were collected via the single-stream program.

The recyclables collected through Chicago’s single-stream curbside container program will not be included in the city’s overall recycling and solid waste processing long-term concession and lease plan.

Handling all the processing of the materials collected through the single-stream container program is Resource Management, a Chicago-based recycling firm. The company was awarded the contract, which is for two years, by the city late last year. This contract also allows for a two-year extension.

According to the contract, the city’s Department of Streets and Sanitation picks up the containers every two weeks and delivers the material to Resource Management’s facility.

Greg Maxwell, senior vice president of Resource Management, Chicago Ridge, Ill., says that while the program is fairly new, the participation rate and the quality of the material being collected in the 96-gallon containers is very good. "People are hungry to participate," he adds.

Maxwell says that as the city adds more households to its single-stream collection program, the collected material will also go to Resource Management’s facility.

The city also operates a number of drop-off locations for recyclables. Materials collected at these spots are delivered to Waste Management for processing.

Meanwhile, some of the finalists who are looking to land the operating bid for Chicago’s MRFs say they are confident the program the city has yet to release final details on will allow an operator to boost recycling while providing the city with waste management services.

Dan Jameson, vice president of government affairs and municipal services for Allied Waste, the parent company of Allied Waste Transportation, the present operator of the MRF, says he sees some excellent opportunities to strengthen the blue-bag program presently operated by the city.

Jameson says that despite the challenges of the blue-bag program, Mayor Richard Daley has been far ahead of other mayors in promoting recycling causes. "The program has gotten better each year," Jameson says. However, he adds, "More education is needed to provide information to residents on the best way to increase recycling through the blue-bag program."

Another company seeking to land the contract with the city of Chicago is Republic Services. While the focal point of the bid will be handling and processing the solid waste and blue-bag generated recyclables, Will Flower, a spokesman for Republic Services, says that a combination of mechanical improvements and labor could make solid waste and recycling services more efficient.

One challenge each of the finalists to the bid has to contend with is the fact that the city has yet to release the actual requirements with the RFP. Flower notes that the city will likely indicate to the winning bidder what it will pay the operator to process the materials, making it incumbent on the operator to develop a method to ensure that the material being delivered can be handled, processed and shipped cost effectively.

In its RFQ, the city of Chicago writes that it "expects to establish a contract term and per-ton tipping fee prior to bidding, subject to an inflation adjustment, which will be fixed for the term of the concession agreement. The highest up-front concession payment will receive the award."

Currently, the city receives a negotiated discount on tipping fees as compensation for recyclables, which Allied separates and is permitted to sell on its own.

The city has yet to determine when it will release its official RFP for the finalists to bid on, and the present contract will run until late next year.

Even with Chicago’s single-stream container program growing in popularity and the potential growth in recyclables through the anticipated RFP, the city still needs to address issues related with collecting recyclables from high-density residences and businesses. One report shows that approximately 80 percent of the city’s waste comes from these segments. These sectors are not serviced by the city’s Department of Street & Sanitation and have struggled to get their waste haulers to fully embrace recycling.

The author is senior and Internet editor of Recycling Today and can be contacted at dsandoval@gie.net.