Fort Smith Board of Directors agrees on recycling plan, will begin June 21

The Fort Smith Board of Directors on Tuesday (June 20) approved a new recycling agreement with Third Rock Recycling, and their partner Pen Sales, for recycling services.

In a 4-1 vote at the regular board meeting, Directors Don Hutchings, Keith Lau, Mike Lorenz, and Tracy Pennartz, voted to approve it as a “short-term solution” to the city’s well-publicized recycling woes. Director George Catsavis was the lone “no” vote, while Directors Andre Good and Kevin Settle were absent.

For Catsavis, the vote was “nothing against Third Rock, but I want to hear from an expert on recycling who can tell us if we are doing the right thing or not.” Pennartz approved based on the fact it “starts the recycling again, and I think that’s a need we have in our city.”

“But I also understand from the agreement this particular contractor is interested in working with us on a materials recycling facility. Whether it would end up with them or someone else, I think that’s the long-term solution. I’m not talking long-term 10 years from now; I’m talking in a 3-5 year period because if you’re looking at a $5 million expenditure, you have to have the money to do it and the right partner to do it with,” Pennartz said.

Fort Smith resident Robbie Wilson spoke briefly in favor of multi-stream recycling during the meeting, but was told by Mayor Sandy Sanders comments could only pertain directly to the agreement. Wilson called the contract “a waste of money.” To his point about multi-stream, Pennartz said once a city-owned facility is in place, “I think discussion of multi-stream recycling veers into that very well.”

Pennartz continued: “I do think this particular agreement as presented does start our recycling again and does have the intent as stated for moving towards a materials recycling center that the city would own.”

The agreement will be effective on Wednesday (June 21). Third Rock’s Mike Birchmeier said the company could start accepting materials from the city as soon as they had found a suitable place to receive the materials. “As early as tomorrow,” he said. This would allow Fort Smith residents to begin separating recycled materials as soon as possible. The agreement will cover household single stream recyclables as well as sorted office paper (SOP) and old cardboard containers (OCC).

Joplin, Mo.-based Third Rock Recycling will accept materials from city trucks at a cost to the city of four cents per pound ($80 per ton). In so doing, the company will immediately accept ownership and bale the material for transport to a material recovery facility (MRF) for sorting into different marketable commodities. The city typically collects about 300 tons of household single stream material per month, creating a monthly operating cost under the agreement of approximately $24,000 ($288,000 annually).

With SOP and OCC materials, Third Rock will purchase for $40 under the market rate, which fluctuates monthly, and is based on the “PPI Yellow Sheet,” published the fifth day of each month. The city’s price will be based on the Yellow Sheet’s “high-side of the southwest region,” which is currently $165 for June of 2017, meaning Third Rock would keep $40 per ton and return $125 per ton to the city.

As the city typically collects about 80 tons per month of OCC and SOP materials, the agreement will generate operating monthly revenue of approximately $10,000 ($120,000 annually, using June’s market prices).

Considering both operations, the city will have a net expense of approximately $14,000 per month ($168,000 annually).

“For the remainder of FY2017, associated expenses will be covered through adjustment of the existing operating budget and not require additional appropriation,” wrote Fort Smith Deputy City Administrator Jeff Dingman in a memo to the Board.

The term of the contract will be for two years, and the city can choose to option for a third year. With Tuesday’s approval, Third Rock Recycling and Pen Sales will begin working with the city to secure and add a single-stream sort machine, Dingman’s memo continued.

“When that happens, the parties would then replace this agreement with one that addresses the purchase of the machine and pays the city 1⁄2-cent per pound ($10 per ton, about $36,000 annually) for the single stream material, plus the revenue from SOP/OCC. It is anticipated that securing and locating such a sort machine could take from six to twelve months.”

Whether the sorting machine is purchased directly by Third Rock Recycling/Pen Sales or the city participates in the purchase of the equipment has not been determined.

“Such determination on these elements will require re-visiting this operating agreement or replacing it with a different agreement at a later date, at the discretion of the parties,” Dingman said.