Allied Waste details curbside recycling contract with City of Yu

Yuma

Allied Waste details curbside recycling contract with the City of Yuma

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YUMA, AZ - Two days after the Yuma City Council voted 6-1 to pass curbside recycling we are finally getting answers to clearly explain the dollars in this revenue sharing deal between the city and Allied Waste.

KSWT News 13 sat down with Allied Waste to crunch numbers, clear the air, and to get to the facts. 

Since Wednesday, after the Yuma City Council passed this curbside recycling deal, we've talked to players on all sides: City of Yuma Administrator Greg Wilkinson who negotiated the deal, Yuma Mayor Alan Krieger, who was the lone "no" vote, Councilmember Cody Beeson, who voted "yes." And today KSWT News 13 spoke to Derek Ruckman, General Manager of Allied Waste.

KSWT News 13 sat down with Ruckman to go over the contract so we could weed through the political in-fighting to show the taxpayer the real numbers that the Yuma City Council could have presented two days ago to set the record straight.

"When you roll out a recycling program, you have to understand what kind of volume we're going to be working with. We don't really know that, we have an idea," said Ruckman.

Ruckman says the revenue sharing formula presented in its contract with the City of Yuma is just an example based on fiction, not reality.

He admits using this formula will steer residents to calculate the wrong math.

"Is it confusing? Absolutely, it's confusing. It's confusing for anyone that's looking at it for the first time. There's some explanation needed," he said.

Ruckman says it's too soon to determine the company's net profit because yet to be analyzed is the true volume of recyclables collected including: paper, plastics, and fiber.

"We also don't know whatever tonnage we receive from the curb, what kind of tonnage it's going to be, we don't know how much newspaper it's going to have, we don't know how much cardboard it's going to have and most important thing, we don't know how much trash it's going to have and so all these play into the economics of curbside recycling," he added.

As for Allied Waste's capital investment, the recycling company will spend $1 million in upfront costs to buy 21,000 recycling bins which will be given to Yuma residents, free of charge. That means it won't cost the city of Yuma a single dime to start its recycling program.

We asked Ruckman what stake in this deal does Allied Waste have. "There's a lot or work that needs to be put in to make this deal successful. Getting a community to buy-in and behave differently is a challenge," he explained.

As for the overall revenue Allied Waste believes it can generate from this deal? Allied Waste projects it could earn $6 million in revenue over the seven year contract. However - that's a low estimate.

After the cost of doing business, paying employees, sorting and transporting recyclables, the profit margin will be much less. That figure has yet to be determined.

"There's a lot of cost involve and processing this material. Not only are we purchasing carts but we also have to use fuel to get it to the processing facility, we have labor we have a baler, a loader, a bobcat, we have 25 employees, medical insurance, electricity," said Ruckman.

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