Sunoco advised, but mayor may want Tidewater

By Ray Gronberg

gronberg@heraldsun.com; 419-6648

DURHAM -- City Council members Monday night are once again scheduled to decide what company will sort and sell the recycled goods the Solid Waste Management Department collects from Durham residents.

Administrators are recommending that the council go with a firm, Sunoco Recycling, that will haul the goods to a sorting plant in Raleigh and handle them entirely at its own expense.

The deal squares with Mayor Bill Bell's demand in August for a no-cost, no-risk arrangement that would shield the city from the ups and downs of the recycling market. Until then, officials were looking at deals that would cost the city money when materials prices are low and make it money when prices are high.

But it's not clear, going into Monday's debate, whether Bell will accept any deal that isn't with a competing firm, Tidewater Fibre.

Tidewater until this summer handled curbside collections for the city. It lost that business when officials decided to take collections in-house, and is now fighting to land the processing contract. It would haul the goods to a sorting plant in Virginia, again at no cost to the city.

The company has hired two politically well-connected Durham lawyers, Ken Spaulding and James "Butch" Williams, to lobby for it.

Also, a Tidewater vice president and co-owner, Michael Benedetto, recently told officials that if they give the contract to one of his competitors, he'll lay off the 31 workers the company still employs in Durham.

That threat clearly has Bell's attention. "Jobs are important to me on this project, given where we are," he said during a council work session last month, referring to the spike in unemployment locally caused by the recession.

City officials are formally grounding their recommendation to give the contract to Sunoco on the company's offer to provide an array of bonus services at its own expense, including costly electronics recycling.

Benedetto has said Tidewater can match anything Sunoco offers, and administrators intend to hold him to that.

City Manager Tom Bonfield said his advice to council members Monday will be that if they choose to go with a company other than Sunoco, they should insist that it sign the same deal on the same terms administrators have negotiated with Sunoco.

Bonfield also made it clear he's standing behind the Solid Waste Management Department's preference for Sunoco. It's offering "value-added features that really enhance the city's recycling program, and that I can't ignore," he said.

But though no one's saying so aloud, it's obvious there are trust issues between the city staff and Tidewater that are shaping the administration's recommendation as much as the sweeteners Sunoco has put on the table.

In the summer, Solid Waste Management Director Donald Long called out Tidewater for basing its case for a revenue-sharing deal on fiscal 2008-09 prices for recyclables that were quite a bit higher than the company had really obtained that year for Durham goods.

Last month, a new discrepancy emerged when Bendetto told council members that 15 to 20 percent of the waste Durham sends for processing is "contaminated" with materials that can't be recycled.

The claim was meant to warn members away from a deal with Sunoco that included an industry-standard clause calling for the city to pay for hauling off goods that are more than 10 percent contaminated.

The trouble was that Bendetto's figures were news to administrators. Long told council members he'd asked Tidewater for a contamination number a month earlier and hadn't gotten a response.

Bonfield is standing behind Long on that point, saying Friday administrators can document the earlier request. And he added that since last month's work session, the firm has brushed off requests for additional information.

"They've said, 'That's all we're giving you,'" Bonfield said. "We think the number is overstated."

The manager said Tidewater is required to supply the data under term of its stopgap processing deal with the city, and "would be required to do it under the proposed agreement as well."

Officials need to know the contamination figure on an ongoing basis so they can gauge and avoid the city's potential exposure to extra costs.

The point is sensitive enough that the new processing deal will include a clause requiring notification of the city by the contractor of excess contamination within 24 hours, "or they forfeit the right to make a claim," Bonfield said.