Concerns dog recycling contract

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This article was published 15/04/2018 (2349 days ago), so information in it may no longer be current.

Concerns about the reputation of a Toronto-based recycling company and world market fluctuations for recycled products prompted a civic committee to turn down an administrative recommendation on a 10-year, $112.6-million contract to process and market material collected from Winnipeg’s curbside program.

Councillors voted 2-1 Monday afternoon against awarding the contract to Canada Fibers Ltd., which operates 14 similar facilities across the country, most of them in Ontario.

“That’s democracy in action,” said Coun. Brian Mayes, chairman of the environment committee, following the 31/2-hour meeting. “To the committee’s credit, there were a lot of good questions asked.”

Mayes (St. Vital) was the member of the committee who voted to award the contract; Couns. Janice Lukes and Jason Schreyer were opposed.

Schreyer (Elmwood-East Kildonan) said he remains concerned the proposed contract doesn’t protect Winnipeg property taxpayers against unexpected cost increases.

Lukes (South Winnipeg-St. Norbert) said she’s troubled by published accounts of Canada Fibers’ dealings with the City of Toronto: the firm signed two nine-year contracts in 2014 for a combined $352.67 million, then renegotiated for more money three years later.

The two contracts were renegotiated in March 2017, and the firm was awarded an additional $97.78 million — but the reasons behind the decision are confidential and tied to what a report stated is “litigation or potential litigation” over the contracts.

There was also a confidential investigation by Toronto’s auditor general into operations at a local processing plant. An October 2017 report to Toronto city council’s audit committee made several recommendations, including hiring an independent auditor to monitor operations at the processing plant and for the city to regularly rotate its staff who deal with Canada Fibers.

Canada Fibers was also cited in 2015 for breaching the City of Toronto’s fair wage policies. While the company admitted no wrongdoing, it agreed to a $1.2-million settlement with employees at its north Toronto plant.

Despite the Winnipeg civic committee’s decision Monday, awarding of the contract will be considered today by Mayor Brian Bowman and members of his executive policy committee.

A final decision is expected to go to council at its April 26 meeting.

The three councillors did agree Monday to request administration provide a report detailing which Canadian municipalities have fair wage provisions in agreements with contractors and details of those provisions.

An administrative report said five firms bid on the 10-year contract, but Canada Fibers was rated the highest and put in the lowest bid.

The request for proposals requires the winning bidder to construct a state-of-the-art processing facility and have it operational by Oct. 1, 2019, and requires the winner to find markets for the processed recyclables.

The city collects about 56,000 tonnes of recycled material in its blue carts program and earns about $3.3 million in annual revenue from the sale of the processed material.

A decision on the contract was put on hold April 5, when councillors requested more time and information.

Lukes said she was concerned the city’s water and waste department had strongly recommended Canada Fibers and said Toronto officials it dealt with had reported a good relationship with the company, but had failed to mention to the committee the outcome of the renegotiated contracts and the auditor general’s investigation.

“I want to hear more from the public service on these issues,” Lukes said. “I haven’t made up my mind on how I’m going to vote when this matter goes to council, but I do want to know more about this company that we might be entering into a 10-year relationship (with).”

The committee debate was preceded by two hours of presentations by representatives from Emterra Environmental, which currently does the processing, and Canadian Union of Public Employees Local 500. Both groups want the committee to reissue the request for proposals for the 10-year contract.

Emterra and the union said the administration had changed the quality standards for the new 10-year contract, which didn’t reflect current market conditions and could mean a loss of revenue for city hall and increased costs.

The union also questioned awarding the contract to Canada Fibers after its controversial history with Toronto.

Mark Badger, Canada Fibers executive vice-president, told the committee the firm believes in having a good relationship with its municipal clients.

Badger said he didn’t want to get into details into what led to the $97.78-million renegotiation in Toronto, explaining, “Sometimes there are things that happen that could not have been envisioned by either party.”

Badger said Canada Fibers is committed to providing a wages and benefits package comparable to that currently offered by Emterra.

aldo.santin@freepress.mb.ca