North Riverside’s village board got an object lesson in economics recently, when trustees voted to seek competitive bids for waste hauling services. With its latest contract with Allied Waste about to expire, the village received Allied’s proposed increases if the village sought to simply renew the longstanding deal it’s had with Allied.
In the past the board may well have just accepted the pitch and re-upped with their waste hauling partner of the last couple of decades.
Trustee Rocco DeSantis, who chairs the village board committee that oversees waste hauling, had other ideas. He recommended that the village seek proposals and was joined in that call by his ally on the board and committee, H. Bob Demopoulos.
When it came to a vote of the full board to seek the proposals, however, it was interesting to note that the idea didn’t get unanimous support. Two trustees, finance chairman Tom Corgiat and Randy Czajka, another member of the board’s finance committee, voted against the measure.
As members of a finance committee for a village that has had to trim staff, cut special events and sell public assets to make pension contributions when they are made at all, we’re not sure what Corgiat and Czajka were thinking, but the result of the bidding process doesn’t do them any favors.
When the bids came back, Allied bowed to the pressure of competition and lower its bid price. And it wasn’t just lower than the quote they pitched to the board earlier this year. It was less than the price that the village was paying them previously.
And they were not even close to the lowest bid by North Riverside’s new waste hauler, Roy Strom.
Had North Riverside continued on with Allied at its initial asking price, the village would have paid hundreds of thousands more dollars than it will end up paying under the new contract. The new deal also brings to the village an easier and cheaper option for recycling, which likely will increase participation in that program.
Add to that the finance committee’s and village board’s decision (both Demopoulos and DeSantis voted against it) earlier this spring to increase residents’ waste hauling rates with the prospect of a new, more expensive contract in the offing, and the board majority hit the daily double. Residents are paying more while the village is paying less. That doesn’t look so swell.
Waste hauling fees ought to be a pass through to residents, unless there is a specific purpose in mind for excess dollars that will accumulate in that particular enterprise fund. It’s not fair to residents to take funds for waste hauling and later transfer them to pay for operations, for example.
The board should now seek to lower the garbage rates to reflect what the village is actually paying for and make it the model pass-through it should have been all along. The board majority was badly outmaneuvered in this instance, and it’s going to cost them come April’s election.
