U-Cycle bids show large cost increases; staff outlines options including higher monthly fee or switching to every-other-week pickup

City staff told the Committee of the Whole that recent bids for Urbana’s U-Cycle curbside and multifamily recycling contracts came in substantially higher than the city’s expiring contracts and laid out options for how the city might respond.

What staff reported - Bidders: Staff solicited separate five-year bids for curbside and multifamily recycling collection. Three vendors submitted proposals; the low bids for each service were different vendors. - Bid results: Multifamily-collection low-bid annual spend is about 47 percent higher than current contract costs; curbside low-bid annual spend is substantially higher than the existing contract (staff presented scenarios that would increase the monthly dedicated recycling tax paid on the city utility bill). - Estimated household impact (order-of-magnitude): maintaining weekly curbside service would raise the monthly recycling line from $3.25 to an estimated $8.68 per month for single-family accounts under staff’s preliminary calculations; switching to every-other-week curbside service would lead to an estimated $5.90 per month charge. Multifamily charges would change on a per-unit basis (an example shown: increase of about $0.80 per unit per month, from $3.25 to $4.05).

Why bids rose Staff cited higher capital and labor costs and tighter margins for vendors as reasons bids rose after a multi-year period during which Urbana’s curbside prices had been unusually low. Staff also noted that smaller or voluntary opt-in models would raise per-user rates because vendors need consistent volume to amortize trucks and labor.

Options presented to council - Maintain weekly curbside collection and adjust the U-Cycle fee (staff estimated a roughly 110% figure in an early calculation and later corrected their slide figures to the household impacts listed above; staff said they would refine and confirm final numbers with finance). Doing so would likely require a budget amendment this fiscal year and a fee adjustment effective January 1 (or an alternate arrangement with the city’s billing partner to implement outside the January 1 window). - Move to every-other-week curbside service; staff cautioned this could increase the marginal collection cost (per pickup) and could produce more material curbside between pickups, slower route days and possible changes to allowable set-out limits in the future. - Phase-in (step) increases or other transitional approaches to smooth the fiscal impact; staff said UCSD (billing partner) may be able to accommodate a non-calendar-year effective date in special circumstances.

Public and operational notes - Multifamily billing is per unit (apartments) or per bed (dormitories). Multifamily service levels vary by property and can include multiple containers and pickup frequencies adjusted by property need. - Staff noted a local drop-off option (Illini Recycling in Champaign) for residents who want to transport recyclables rather than use curbside service; staff will refine outreach and communications plans for property managers and residents if a fee change is pursued.

Timing and next steps - Bids are guaranteed only for a limited window; staff said vendor pricing guarantees expire in mid-December, creating schedule pressure if the city intends to award a contract and secure that pricing for an April 2025 start. - Staff suggested they could use existing fund balance to cover interim cost increases through the end of the fiscal year and then set a new U-Cycle rate in the budget or by a fee adjustment early next year.

Staff requested feedback from the committee and committed to returning with refined numbers from the finance office, a clearer fee schedule showing total monthly bills (sanitary + recycling line item), and suggested public communications. “To maintain weekly service, the total monthly fee for curbside would go up to $8.68 per month,” staff said in their initial estimate, while noting the numbers are preliminary and will be finalized with finance.

Ending - No formal decision was made; staff will return with refined fiscal calculations, an outreach plan, and timetable options that account for vendor bid windows and the city’s billing mechanics.