Costa Mesa Sanitary District wants to renegotiate CR&R trash contract

Officials in the Costa Mesa Sanitary District are looking to renegotiate the agency’s agreement with its contracted trash hauler — with a particular focus on eliminating an “evergreen” clause that, without action, allows the current pact to continue indefinitely.

Following a unanimous board vote last week, district staff will work with CR&R Environmental Services to revise the contract over the next three to six months.

The district has contracted with CR&R to collect residential trash since 2006, so it makes sense to take another look at the deal’s terms, General Manager Scott Carroll said Wednesday.

“This board and previous boards have always made the decision to negotiate with haulers,” Carroll said. “There are definitely benefits in negotiating a good deal.”

The district pays CR&R about $4.1 million a year for services including curbside and bulky-item pickup and green waste recycling, according to Carroll. That annual payment is based on how much trash is collected and how many residences are served.

During a meeting Feb. 22, district staff recommended that the board issue a notice of contract termination to CR&R. Doing so, Carroll said, would give the district the option to either hammer out new terms with the hauler or put the contract out to bid.

Scrapping the contract wouldn’t have been immediate. Under the “evergreen” clause, the district essentially has to provide six years’ notice — meaning the agreement would have expired in 2023 at the earliest.

Carroll said provisions like that are typical in trash contracts because they provide stability and certainty to haulers who make large financial investments to provide service in a given area.

But rather than sending a cancellation notice, district board members voted last week to direct staff to negotiate a new deal with CR&R.

Board President Mike Scheafer said those talks should include scrapping the evergreen provision.

“This evergreen thing seems to hang over us like relatives that stay too long and fish that you don’t put in the refrigerator,” he said at the board meeting. “There’s a stink factor there that I would like to get rid of.”

Even if the contract were put out to bid, board Vice President Jim Ferryman said, it’s unlikely the district would move away from CR&R because of the services the hauler provides — particularly its organics recycling program.

“There are some people in the community that feel we should go that route, but I think the end result is going to be the same, personally, any way we go,” Ferryman said.

Scheafer agreed that “there’s nobody out there that can do what we, as a board, want to do except our current hauler.”

Dean Ruffridge, a senior vice president with CR&R, told the board that the company is willing to consider a fixed-term contract that would expire on a certain date.

Though it’s not yet known how long such a contract would last, Carroll said it likely would run at least 10 years.

District staff will meet with CR&R in coming months and work to hash out a new agreement to take to the board for consideration, Carroll said.

Along with eliminating the evergreen clause, topics expected to be discussed include whether it’s possible to revamp the rate structure.

Carroll said the district also wants to talk with CR&R about installing GPS in its trucks to determine their location at any given time to help resolve complaints about trash carts not being picked up.

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