A DeLisa truck on the job Tuesday morning. (Photo by Brian Donohue. Click to enlarge.)
By BRIAN DONOHUE
A 2014 photo from the pre-privatization days, when Red Bank Department of Public Utilities employees handled residential curbside trash collection.
The Mayor and Borough Council unanimously approved a resolution on February 12, approving a new five-year contract with DeLisa Demolition Inc. of Tinton Falls. The contract took effect on March 1, according to the resolution.
DeLisa, a company that has handled trash and recyclables collection since the borough privatized the operations in 2015, was the sole bidder for the contract.
While a 27-percent increase sounds steep, Borough Manager Jim Gant told the council he feared far worse when the contract neared expiration and the borough prepared to seek bids for a new one.
By comparison, Gant said three comparable New Jersey towns that renewed trash hauling contracts recently had seen increases of 40 percent, 73 percent and 97 percent.
Gant did not name those towns, but an internet search shows recent increases of 73 percent in Hoboken; 45 percent in Clifton; and 50 percent in Pequannock.
“Red Bank did very well in this bid cycle,” Gant said. “We were holding our breath, kind of expecting these results, but again I was quite happy.”
“Unfortunately, nowadays, it’s something that’s experienced by municipalities all over New Jersey; these bids generally only get one bidder, and, you know, it’s an issue in the industry,” he said. “However, it’s a service that has to be provided as a matter of public health and safety.”
The borough last year paid DeLisa $1,065,000 under the final year of the previous contract. The annual payment for the year starting March 1 will now be $1,358,400, according to Gant.
Councilman Ben Forest raised the question of whether the cost increases and lack of bidders might make it worth considering whether, “at the next cycle,” the borough’s Department of Public Utilities should resume the task of handling trash and recyclables pickup.
“Is this something we should look at, possibly, and keep our options open in the future?” Forest said. “I’m uncomfortable with one bidder.” I’d like to maybe keep that door open, find out what it would maybe cost. It sounded like it saves us money initially, but I’d like to take a look, does it still make sense to do it privately?”
“When it was being debated by a previous council it was about competition and having choices,” Forest added. “And now we don’t have the competition part.”
Borough Attorney Greg Cannon said towns are seeing fewer bidders for waste hauling contracts because of the “significant amount of risk, particularly for the length of time that towns want to lock in prices.”
“As a lawyer who looks at these in every town, you’re not the only one who has gotten only one bidder,” he said.
Cannon said rising energy costs and the plummeting value of recyclable materials were key factors.
“There was a moment in history where the amount of money you could get for recyclables was high, you would commonly see six or seven bidders on every contract,” Cannon said. “The same bidder tends to bid in the town that they bid because they know it the best, better than anyone else and they have a built-in advantage when the market is bad and risky for the haulers.”
Gant added that a primary issue with taking trash collection back in-house is the exorbitant cost of workers’ compensation insurance the borough would have to pay.
The last contract renewal in 2020 led to a flap centering around allegations that members of the borough council were meddling in the bidding process.
redbankgreen editor Brian Donohue may be reached via email at [email protected] or by calling or texting 848-331-8331.
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