Charlotte City Council
Environment Committee
Meeting Summary for December 8, 2008
COMMITTEE AGENDA TOPICS
I.
II.
Subject:
Coca-Cola Partnership Proposal for Recycling
Action:
Recommend City Council 1) approve the recycling proposal with CocaCola; 2) authorize the City Manager to negotiate a written partnership for
Council consideration on January 12; and 3) refer the question of
developing a sponsorship policy to Restructuring Government.
Subject:
Meeting Schedule
Action:
Monday, December 15 at 3:30 p.m. – Room 280
COMMITTEE INFORMATION
Present:
Time:
Edwin Peacock, Nancy Carter, Susan Burgess, Warren Cooksey and
Andy Dulin
3:00 p.m. to 3:55 p.m.
ATTACHMENTS
1. Agenda Package
Environment Committee
Meeting Summary for December 8, 2008
Page 2
DISCUSSION HIGHLIGHTS
Committee Discussion:
Committee Chair Edwin Peacock welcomed everyone to the meeting and asked those in
attendance to introduce themselves.
I.
Coca-Cola Partnership Proposal for Recycling
Chair Peacock asked Julie Burch to provide context for today’s meeting. Ms. Burch
reminded the Committee they were here to further discuss the Coca-Cola residential
recycling proposal. The Committee was provided with a Question and Answer sheet in
their packets [copy attached] from the last meeting. There will not be a formal staff
presentation, but this is on Council’s agenda today for the meeting starting at 4:00 p.m.
Staff is ready to answer any questions.
Peacock:
Ms. Garland, could you give us a little history on the policy [managed
competition].
Garland:
Solid Waste Services’ business model is managed competition. All four
zones have competed against the private sector – for example the recent
East Zone. Two of the zones are now optimized, which means they have a
benchmark and are monitored. The East Zone is under managed
competition, so it can go into default, which is why we are cost conscious.
If we move a truck from the North Zone to the East Zone, the East Zone
has to pay. It costs around $600/day. It is like we have four departments
within one department. We want to be competitive with the private sector.
Carter:
Is there the potential to deliver this [Coke promotion] to an
underperforming zone? Could we look at just the North or West because
they are underutilized?
Garland:
The East and West are under managed competition.
Carter:
For the zone that is privatized [West], will there be a problem with greater
recycling?
Garland:
There will be zero cost to the City; it is part of their contract. There is a
monthly rate for garbage, recycling, yard waste and bulky items. We
don’t pay for each service, just for the availability.
Carter:
Would they make a profit?
Garland:
Their profit margin would decrease.
Environment Committee
Meeting Summary for December 8, 2008
Page 3
Burch:
All of this is really speculation though because Inland is a private
company and they do not provide us with their profits.
Peacock:
So, best case would be for all of the recycling increases to be in the West,
so there is no cost to us.
Garland:
The concern would be that they weren’t able to collect the recycling on
the day of collection.
Burgess:
But, they are still obligated to pick it up.
Peacock:
Council members Burgess and Carter, you both raised concerns and I
know Council member Carter also had a concern about grants, are there
other concerns you would like to address because we can spend time on
this issue today.
Burgess:
I appreciate the answers to the questions we asked. This has been a good
review. But, I still have concerns about the additional cost to the City
especially in a tight budget year. This is not a priority. We have an
Environmental Manager that is a priority and another priority would be
public safety. If we had the benefit of corporate partners absorbing the
additional costs that would be helpful. If the additional cost is being
absorbed in the budget this year, I wonder if we couldn’t save that money
or redirect it to other priorities. We should work to save money in City
operations. The irony is as our needs increase as a City, it is difficult to
pay for them. We have to tighten our belts.
My other concern is the timing is off for recycling. We have another
eighteen months before we implement single-stream and there will be a
huge PR effort to coincide with our ability to handle the additional costs.
So, the timing is off. I don’t want to discourage partnerships, but I
continue to be very concerned with the loss of jobs that will be
challenging our constituents.
Peacock:
Ms. Garland, in the write-up you reference $175,000 to promote recycling.
Is there any thought about how the marketing Coca-Cola, Harris Teeter
and the Observer are doing will overlap and actually help us? They are
helping us to promote something now. In a perfect world of single-stream
being ready, would this help us with the money we are spending?
Garland:
The $175,000 is mostly public information staff. We have the broad
Curb-It program, but if a driver notices there is a problem in a
neighborhood with how recycling is prepared, we will send staff out to the
neighborhood. The $175,000 is more education, how to prepare for all
Environment Committee
Meeting Summary for December 8, 2008
Page 4
four of our services. The majority does relate to recycling. We work with
Homeowners Associations, churches, etc. We don’t run ads. When we go
to single stream, we will be promoting it. We will take out ads and
blanket the City with information. There will be a blitz campaign to get
people to start recycling. We don’t have a budget for that, but it will be a
sizeable investment. We plan to go into the schools and create badges to
give the students to become “recycle cops”. We may exceed $175,000
when we get to that.
Peacock:
Is it $175,000 a year?
Garland:
Just keeping the education.
Peacock:
Is there any chance this offsets those costs? Is there a trade off?
Williams:
That is staff cost – the overhead cost. We do promotional brochures about
every two years. The $175,000 is personnel costs.
Peacock:
Has there been any history of offering cash rewards?
Garland:
In 2003, there was an incentive program where we did a cash reward as
part of an incentive blitz.
Williams:
We ran a program for 90 days with a grant. We gave out $100 gift cards.
Peacock:
Mr. Steele, how long is this program?
Steele:
Twelve months.
Burgess:
Did you ask our corporate partners if they would pick up the cost?
Burch:
We didn’t ask. That question came up during the last meeting.
Burgess:
Did you ask them if they would further consider picking up the cost?
Burch:
We did not. We have had no contact with Harris Teeter at all. They did
not approach us.
Burgess:
In looking at the minutes, I asked this at the last meeting.
Peacock:
So, you are asking if they will pay additional costs other than what is on
the table?
Steele:
I think we have brought a generous, innovative program and this could be
Environment Committee
Meeting Summary for December 8, 2008
Page 5
the beginning of a potential partnership going forward that might have
long-term effects to address the needs of the City. This could be a good
bridge to get to single-stream by doubling your promotional activities.
There is evidence in other cities that this is very popular and it meets your
stated goals.
Carter:
Could we discuss if there is a possibility for a trial? Maybe we could
target the West quad. There is no cost to us and this is an area that needs
help. We could have the highest impact there for this trial time and then
reconsider the proposal on a larger scale. We are going to need volunteers
to educate people about this new service. So, my three points would be
1) do this as a trial in a specific target area; 2) expand to a larger area with
the money saved; and, 3) this directly leads us to the timing we are
committing to single stream to make that successful.
Peacock:
We would need to discuss with legal staff if there are potential conflicts by
working with a private partner in one area. Do we need to serve all areas
and not just target one zone? Would that give the appearance of not being
fair? We need to wall off the potential legal ramifications of sponsorship
vs. partnership. Do we have any history of contests?
Hagemann:
We haven’t considered that question. But, I think a trial could be
structured so there is a rational justification. There is no legal right
anyone has to win a prize.
Peacock:
What if the City is sponsoring?
Hagemann:
The legal analysis would not be different.
Burgess:
A trial might work without costing us any money and would give us time
to develop a policy. The legal staff has asked some good questions, like
what prevents Pepsi from coming to us.
Peacock:
That is a different subject.
Burgess:
We could do a trial and then the policy would be ready to go.
Peacock:
We have an RCA with an action to approve a recycling promotion and the
City Manager can work through the other details. I agree with your point
about the policy. We need to discuss the policy issue around sponsorship.
I know we had advertising on transit, so we still need to get around that
subject.
Dulin:
I would say that twelve months is a trial. We will be getting reports about
how it is going, so it will take us that long anyway. $175,000 is mostly
Environment Committee
Meeting Summary for December 8, 2008
Page 6
staff time and we already have the staff, so this won’t be extra?
Garland:
It is not extra.
Dulin:
We are using our folks. So, this is an opportunity for us to have a
public/private partnership with a five star corporate citizen that is based in
Charlotte. They have 15,000 employees in the region that live here and
shop here. They are an unparalleled corporate partner. This is Coca-Cola
thinking harder and faster than their competitors. They have been driving
this train all these years ahead of the competition. They will work harder
to get ahead. Lauren Steele has a multi-year track record working with the
community. I signed a pledge in front of him in 1994 to pick up campaign
yard signs. Do you know how hard it is to pick up yard signs after losing?
He is trying to make our community better and he has Coca-Cola money
behind him.
Cooksey:
I would make a motion that we recommend City Council authorize the
City Manager to negotiate a written partnership agreement with CocaCola and their request to partner in a program with the City of Charlotte to
promote residential recycling for Council consideration on January 12. I
would like to see the document we are voting on before we let it go. Will
Council just be discussing this tonight?
Burch:
It is Council’s call.
Cooksey:
Given that we are in new territory, I would like to specify this is unique to
this promotion and that Council sees it on January 12. Will we refer the
question of establishing a sponsorship policy to Restructuring
Government?
Dulin:
Second.
Carter:
What is the motion again?
Cooksey:
1) Approve the recycling proposal; 2) authorize the City Manager to
negotiate a written partnership for Council consideration on January 12;
and 3) refer the question of developing a sponsorship policy to
Restructuring Government. So, we would give conceptual blessing to a
formal document on January 12.
Burch:
If the partnership is approved, we would monitor this on a monthly basis.
Ms. Garland will know month one if there are overtime costs. So, we will
be able to gauge this early on. I’m sure Coke would be interested too.
Environment Committee
Meeting Summary for December 8, 2008
Page 7
Cooksey:
There are some interesting parallels going forward. The County
Commission just blessed the use of the County logo. They have an
agreement with Harris Teeter and a long record of nothing formal. I think
it appropriate for the City to have a little more detail because we have to
deal with collection, but this happens with or without us. We are over
thinking this. It will happen, they are just letting us know about it. But,
we did expose the issue of finding ways to advance the City’s goals, we
just don’t want to get too far in the weeds.
Carter:
Council will debate this on January 12. I am still struggling with the
escalation of cost. Are there evaluation points?
Cooksey:
I think staff has heard loud and clear that we want check points. We will
have some of those elements on January 12. This fiscal year, we won’t
see much impact, but we will need to make considerations when
developing the FY10 budget. We will know if we were too low or too
high. Again, this happens with or without us. If it happens without us, we
don’t get reports. There is an advantage to being a partner because we get
to see the costs and establish what is valid. We would address some of
these anyway with the recycling promotion.
Burgess:
I’m not so sure. What if we take this off the agenda and let them just do
it. They won’t help us. The red bins belong to us. Ms. Garland, do you
have any issues with the stickers? Will they cause any problems?
Garland:
We haven’t had any issues.
Burgess:
Well, we could take it off the agenda and just let it roll.
Peacock:
Are you making a substitute motion?
Burgess:
I just wanted to get feedback.
Peacock:
Our recommendation already has a cause and effect. The City Manager
would negotiate the details. As a macro-matter, recycling is good. The
DENR initiative helps us prioritize this just as it is preparing us for single
stream. The focus area plan we adopted says we will be a national leader.
There is no reason to let this pass without the benefit of being involved.
We benefit because we are picking it up and we are offsetting costs at the
landfill. We are headed in that direction with the new facility. We
respond in the same manner if we have trees down in an ice storm, there
are cost overruns. We are just being warned. In the West, which is
currently the lowest area, we could be the biggest winners.
Environment Committee
Meeting Summary for December 8, 2008
Page 8
Carter:
How many Harris Teeters are in the West? Could we get District results
on recycling – zone districts?
Garland:
Yes, we have that by solid waste zone.
Cooksey:
There is value in seeing the results as a partner. We can track the
correlation with Coca-Cola.
Peacock:
We have a motion on the table, I would like to call for the vote.
Motion passes 4 – 1 (Peacock, Carter, Cooksey and Dulin – for; Burgess – against)
Ms. Burgess added that she was opposed because we have no policy, but she supports
recycling.
II.
Next Meeting
Monday, December 15, 2008 at 3:30 p.m. in Room 280.
Meeting adjourned.
Environment Committee
December 8, 2008 at 3:00 p.m.
Charlotte-Mecklenburg Government Center
**Room CH-14**
Committee Members:
Edwin Peacock, Chair
Nancy Carter, Vice Chair
Susan Burgess
Warren Cooksey
Andy Dulin
Staff Resources:
Julie Burch
AGENDA
I.
Coca-Cola Partnership Proposal for Recycling
Staff Resources: Julie Burch, Victoria Garland, Bob Hagemann
The Committee is asked to make recommendations to the Council. The Request for
Council Action is scheduled for the December 8 business meeting.
Attached is information addressing the questions raised by Committee members at the
November 17 meeting.
II.
Meeting Schedule:
Monday, December 15, 3:30 p.m.
Agenda:
Water Revenue Stabilization Recommendations
Revisions to Tree Ordinance
Focus Area Plan
Citizen Pledge for the Environment
Distribution:
Mayor/City Council
Mac McCarley
Curt Walton, City Manager
Brenda Freeze
Leadership Team
Environmental Cabinet
Responses to November 17 Environment Committee Questions
Related to the Coca-Cola Proposal to Promote Recycling
SOLID WASTE SERVICES
When did curbside recycling begin in Charlotte?
A recycling pilot program began in 1989. The pilot was conducted in Charlotte’s Dilworth
neighborhood. The success of the pilot program was the catalyst for the creation of the curbside
recycling program. The City-wide curbside recycling program started in January 1991.
How would an increase in recycling impact the City’s Solid Waste resources, particularly
under managed competition?
Under the Council-approved Competition and Privatization policy, the City’s Solid Waste
Services have operated under managed competition for a number of years. The City competes
against the private sector for the right to provide collection services to the residents of Charlotte.
For purposes of managed competition, the City of Charlotte is divided into four zones – North,
South, East and West. A copy of the zone map is attached. The City currently holds contracts for
three of the four zones. Services in the West zone are provided by a private contractor, Inland.
Each zone operates as a separate business with its own collection resources and budget. The
resources in each of the three City zones are based on collection workload in each zone and are
not transferrable to other zones, except as noted below. Resources needed for each type of
material collected (garbage, recycling, yard waste and bulky items) vary by zone because of
differences in workload.
As shown in the chart below, residents in the South and East zones recycle more than residents in
the North and West zones. The South and East zones currently operate at full capacity in
relationship to allocated resources for the zones. An increase in recycling in these zones would
cause capacity issues, which could result in a delay in collection and/or overtime spending.
Zone
Set-out rate
North
42%
South
65%
East
43%
West
17%
Currently, there is occasionally unused capacity on recycling routes in the North zone, which
means an increase in recyclables could potentially be absorbed with existing resources.
However, these resources cannot be used to alleviate capacity issues in the South or East zones
as manpower and trucks are used to support other collection routes in the North. For example, if
a recycling driver in the North finishes his route before he has worked a full 8 hours, he assists
with collecting garbage or yard waste on a route in the North zone where a driver is absent or
there is a large volume of material to be picked up.
In addition, if resources are moved to another zone, the cost of those resources must be charged
to the other zone. So, if a truck and driver from the North zone assists with collection in the
South zone, the cost of renting the truck and the driver must be deducted from the North zone
contract and applied to the South zone contract. This means there is an actual cost to the South
zone, which could result in the costs exceeding the bid amount. Resource rental only works
within City contracts; this approach cannot be used for the private contract in the West, which
has the most unused capacity. In the West zone, the private contractor is required to absorb any
additional costs associated with an increase in recycling, or other workload increases, with no
costs to the City.
Are there grants funds that could be used to offset the anticipated increased operational costs
associated with increased promotion of recycling?
No. N.C. Department of Environment and Natural Resources Division of Pollution Prevention
and Environmental Assistance and the North Carolina Office of Environmental Education offer
grants that support public education and awareness for waste reduction programs, of which the
City’s CURB IT! residential recycling program qualifies. However, the grant funds cannot be
used for administrative expenses such as overhead costs, land acquisition costs, employee
salaries or contracted collection costs.
SPONSORSHIPS AND PARTNERSHIPS WITH COMMERCIAL ENTITIES
As a follow-up to the discussion of broader policy implications related to the City entering into
partnerships or sponsorships with commercial entities, the City Attorney’s Office has identified
the following issues or questions which would need to be addressed in the development of a
sponsorship policy. This list is meant to be illustrative only.
• Distinguishing between “sponsorships” and “advertisement” (i.e. Airport advertising,
potential CATS advertising, etc.)
• Excluded categories of potential sponsors (e.g. alcohol, tobacco, firearms, gambling,
adult, political)
• Authority to approve sponsorships (i.e. Council? City Manager? Corporate
Communications? Key Businesses?)
• Circumstances under which sponsorship opportunities should be subjected to a
competitive process
• Sponsorships as revenue generation? And/or offering less tangible benefits to the City
• Proactive or reactive – seek sponsorships or respond to opportunities presented
• Staffing and other resources necessary to manage a successful program
• Consistency with County Sponsorship Policy?
• Coordination with County’s program?