Rolling Meadows to outsource garbage collection after long haul of in-house service

One of the few Northwest suburbs still with a fleet of its own garbage trucks, Rolling Meadows is set to privatize garbage collection service, under a deal the city council will consider Tuesday.

Aldermen will vote on a proposed 5-year contract with Lakeshore Recycling Services to pick up refuse, landscape waste and recycling from single-family homes throughout town, in a deal that would provide notable cost savings for residents, city officials said.

At the same time, the council will take a preliminary first reading vote on a separate 10-year lease extension with Lakeshore, which has operated the city-owned transfer station at 3851 Berdnick St. for the past three decades.

Having a municipal-owned transfer station — where garbage trucks temporarily unload waste, before it gets scooped into larger dump trucks and taken to a landfill — is just as rare. Rolling Meadows officials say aligning their refuse and recycling contracts while extending the transfer station lease will provide competitive pricing at the same service levels.

“It is rare, if almost unfounded, that a municipal government is in a position with a transfer station that it’s owned for almost 30 years to be able to leverage that asset to drive lower hauling rates as a result,” City Manager Rob Sabo said.

Households currently pay the city $32.45 per month for trash pickup.

Starting Sept. 28 — if the deal goes through Tuesday — residents will pay $21.18 a month. Seniors will get a 15% discount, for a monthly rate of $19.16.

If in-house hauling were to continue, those rates would go up to $36.67 for most homeowners and $33.01 for seniors.

Lakeshore’s rates will increase 4% a year, under terms of the deal. Garbage containers will remain the same, but residents will be able to request bigger ones measuring 95 gallons.

“I can’t tell you how often we have people come to our finance window and yell at us about how expensive it is to pay taxes and fees, and this is one solution in which we think we have provided an instantaneous source of cost relief for our residents,” Sabo said.

Sabo and Public Works Director Aaron Grosskopf vow service levels will remain the same. Customer service and billing will still happen at city hall, and there won’t be charges for extra or bulk pickups, or yard waste stickers, they said.

The city’s four refuse division employees will be offered jobs by Lakeshore, though they could also decide to be reassigned to another city public works division, officials said.

While the city has contracted for recycling pickup with a private hauler since the mid 1990s, the public works department has handled regular trash collection since 1969.

But costs for in-house collection continue to rise — the price of fuel, among them — while expenditures have been outpacing revenues in the city’s enterprise refuse fund for the past decade, officials say.

At the same time, city officials are eyeing new monies from the renegotiated transfer station lease for road repairs and capital projects — seen as a more stable revenue source compared with declining motor fuel and natural gas taxes.

The impetus for the change — and release of a request for proposals — is the pending expiration of the transfer station lease in August, while the existing recycling contract with Flood Brothers is up in September. Three proposals were submitted, and Lakeshore’s was deemed the best, officials said.

“We’re at a point where doing nothing is not an option,” Sabo said.

Lakeshore will pay the city annual base rent of $150,000 for the first five years and $157,500 for last five years, according to the new transfer station lease.

A related host agreement calls for Lakeshore to pay the city $2.95 for every ton of waste that is brought there — with a minimum of 500 tons per day — and annual 3% increases.

The company is also paying a $1 million upfront fee.

All in, the deal will double the amount of revenue for city coffers, from $232,000 to $571,000.

Lakeshore plans to make some $2 million to $3 million worth of repairs to the facility, and purchase three city garbage trucks for $950,000.