Full Circle Organics - Contract Amendment Copyright 2014
City of Dubuque Consent Items # 13.
ITEM TITLE: Full Circle Organics - Contract Amendment
SUMMARY: City Manager recommending approval for the City of Dubuque to send its
second load of yard debris and food scraps to the Full Circle Organics
facility on any day when the tonnage fee savings equals or exceeds the
additional fuel cost.
RESOLUTION Approving the First Amendment to Agreement between Full
Circle Organics, LLC and the City of Dubuque
SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Adopt Resolution(s)
ATTACHMENTS:
Description Type
❑ Full Circle Organics Contract Amendment-MVM Memo City Manager Memo
❑ FCO Amendment Staff Memo Staff Memo
❑ FCO Composting Agreement First Amendment Supporting Documentation
❑ FCO-Resolution-Approving Agreement Resolutions
THE CITY OF Dubuque
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Masterpiece on the Mississippi 2007-2012-2013
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Full Circle Organics Contract Amendment
DATE: April 28, 2015
On March 13, 2015, the City of Dubuque signed a notice letter extending the City of
Dubuque contract with Full Circle Organics through June 30, 2017.
Citing a continued need for more "carbon" yard debris to mix with the large amounts of
food residuals and paper pulp it is receiving from its commercial customers, Full Circle
Organics' Max Milinkovich has tendered an offer of a reduced fee ($5.00 per ton instead
of$15.00 per ton) for partial truckloads of yard debris/food scraps. The City would still
pay $15.00 per ton for the first (usually full) truckload of materials it delivers each day,
but Mr. Milinkovich is willing to provide more financial incentive for the City to send
partially-loaded second trucks. During the winter months of November through March,
there are no second partial load trucks from the City's Thursday-only collections. In
fact, even during the warm weather months of April through November, there are no
second loads on Mondays.
Public Works Director Don Vogt recommends City Council approval for the City of
Dubuque to send its second load of yard debris and food scraps to the Full Circle
Organics facility on any day when the tonnage fee savings equals or exceeds the
additional fuel cost.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Mic ael C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
Don Vogt, Public Works Director
Dubuque
THE CITY OFkrabd
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Masterpiece on the Mississippi 2007.2012.2013
TO: Michael C. Van Milligen, City Manager
FROM: Don Vogt, Public Works Director DSV
SUBJECT: FCO Contract Amendment
DATE: April 21, 2015
INTRODUCTION
The purposes of this memorandum are to provide information and recommend action
regarding Full Circle Organics' (FCO) new offer to reduce the fee it charges some City
of Dubuque trucks delivering mixed loads of yard debris and food scraps to its
composting facility near Farley.
BACKGROUND
The City's contract with FCO was originally due to expire at the end of June. It provides
the City the ability to unilaterally extend the contract for four additional two year terms
by written notice no later than ninety (90) days prior to the expiration of the current term.
Given the importance of the FCO facility to not only the City of Dubuque's food scrap
collection-for-composting program, but also the City's pending requirement for the use
of compost as a soil supplement for construction and development projects, last month I
recommended that the agreement be extended through June 30, 2017. You concurred
and signed the extension notice letter prepared by City Attorney Barry Lindahl on March
13th. A copy of the notice letter was subsequently provided to the City Council on March
30th as part of the consent agenda for its meeting on April 6th
DISCUSSION
Citing a continued need for more "carbon" yard debris to mix with the large amounts of
food residuals and paper pulp it is receiving from its commercial customers, FCO's Max
Milinkovich has now tendered an offer of a reduced fee ($5.00 per ton instead of$15.00
per ton) for partial truckloads of yard debris/food scraps. The City would still pay $15.00
per ton for the first (usually full) truckload of materials it delivers each day, but Mr.
Milinkovich is willing to provide more financial incentive for the City to send partially-
loaded second trucks. Of course, during the winter months of November through
March, there are no second partial load trucks from the City's Thursday-only collections.
In fact, even during the warm weather months of April through November, there are no
second loads on Mondays.
My calculations show that our second yard debris/food scraps truck on any given day
would have to be transporting a minimum of 756 pounds of materials to FCO's facility to
cost-justify the additional fuel used to travel beyond the Dubuque Metropolitan Area
Solid Waste Agency's (DMASWA) composting facility. This calculation is based on our
current cost of diesel fuel ($2.1245/gallon), the additional mileage (21 .34 miles round
trip between the two facilities' entrances), and our collection trucks' averaging five (5)
miles per gallon on U.S. Highway 20. And if or when our diesel fuel costs return to the
level they were at just a year ago, our second load trucks would have to be transporting
at least 1 ,112 pounds of materials to FCO to cover their additional fuel costs. It should
be noted that the above rather-simplistic financial model does not take into account the
additional mileage on our trucks or the additional, albeit incremental, increase in our
collection operations' carbon footprint. And, as Mr. Milinkovich is already aware, a
substantial segment of every City yard debris and food scraps load during the warm
weather months is made up of grass clippings — a nitrogen-loaded "green" compostable.
In consideration of the above-noted importance of the FCO facility to the City of
Dubuque, and in anticipation of your and the City Council's acceptance of FCO's newly-
proffered cost term, Barry has prepared a resolution and contract amendment providing
for this new price schedule. Mr. Milinkovich has already reviewed and agreed to the
amendment. Since the City Council does not meet again until May 4th, and given
FCO's immediate need for additional yard debris, Barry has opined that your assent to
my recommendation would be sufficient for us to immediately take advantage of FCO's
new price structure prior to formal Council approval.
ACTION STEP
I recommend that the City of Dubuque send its second load of yard debris and food
scraps to the FCO facility on any day when the tonnage fee savings equals or exceeds
the additional fuel cost. In concert, I recommend that the attached resolution and
contract amendment be forwarded to the City Council for its approval.
CC: Barry A. Lindahl, City Attorney
Attachments
2
FIRST AMENDMENT
TO
AGREEMENT
BETWEEN
FULL CIRCLE ORGANICS, LLC
AND
THE CITY OF DUBUQUE, IOWA
This First Amendment to Agreement between the City of Dubuque (City) ,a��d Full
Circle Organics, LLC (Contractor) is dated for reference purposes the J,.� day
of 717141 , 2015.
Whereas, the City and Contractor entered into an agreement for receiving
and processing Acceptable Compostable Materials (the Agreement) dated April
15, 2013, which agreement expires on June 30, 2017; and
Whereas, the City and Contractor now desire to amend the Agreement as
provided therein.
NOW, THEREFORE, IT IS AGREED BY AND BETWEEN THE PARTIES
AS FOLLOWS:
Section 1. Section 11.1 is amended to read as follows:
11.1 Processing Fee. The Contractor Processing Fee is $15.00 per ton for
receiving and processing the first truckload of Acceptable Compostable Materials
each day. Additional truckloads of Acceptable Compostable Materials on the
same day will be charged a reduced Contractor Processing Fee of $5.00 per ton.
The Contractor Processing Fee for the first truckload of Acceptable Compostable
Materials received each day after 1,300 tons of Acceptable Compostable
Materials have been received in the current Fiscal Year is $13.00 per ton.
Additional truckloads of Acceptable Compostable Materials received each day
after 1,300 tons of Acceptable Compostable Materials have been received in the
current Fiscal Year will be charged a reduced Contractor Processing Fee of
$5.00 per ton.
Section 2. All other terms and conditions of the Agreement shall remain
in full force and effect.
1
CITY OF DUBUQUE, IOWA FULL CIRCLE ORGANICS, LLC
By: ,/ `�. - By:
Michael C. Van Milligen Max Milinkovich
City Manager President
By:oo-
Kevin S. Firnstahl Trish L. Gleason
City Clerk Assistant City Clerk
F:\USERS\tsteckle\Lindahl\Agreements\FullCircleOrganicsCom postingAgreem ent_Fi rstAm endm ent_042215.doc
Preparer: Barry A. Lindahl Address: Suite 330 Harbor View Place 300 Main Street Dubuque
IA 52001 Telephone: (563) 583-4113
RESOLUTION NO. 147-15
APPROVING THE FIRST AMENDMENT TO AGREEMENT BETWEEN FULL
CIRCLE ORGANICS, LLC AND THE CITY OF DUBUQUE
WHEREAS, the City of Dubuque (City) and Full Circle Organics, LLC
(Contractor) have entered into an Agreement dated April 15, 2013 for receiving
and processing Acceptable Compostable Materials; and
WHEREAS, City and Contractor now desire to amend the Agreement as set
forth in the attached First Amendment to Agreement.
NOW, THEREFORE, IT IS AGREED BY AND BETWEEN THE PARTIES AS
FOLLOWS:
Section 1. The First Amendment to Agreement attached hereto is hereby
approved.
Section 2. The City Manager is hereby authorized and directed to sign the
First Amendment to Agreement on behalf of the City.
Passed, approved and adopted this 4th day of May, 2015.
Attest:
Kevi S. Firnstahl, City
tuf Zel/
poy D. Buol, Mayor
F:\USERS\tsteckle\Lindahl\Resolutions\ApprovingFirstAmendmentToFullcircleOrganicsAgreement_042215.doc