The City of Scottsdale will begin sending recyclable material to the City of Phoenix after the two sides approved an agreement.
The Phoenix City Council adopted the agreement at its April 1 meeting after the Scottsdale City Council approved on consent the agreement at its March 17 meeting. With the deal in place, Scottsdale will send its recyclable to Phoenix for the next year, after which there are four one-year options available to the municipalities.
Also part of Scottsdale’s approval is a budget transfer of up to $550,000 from the solid waste fund operating reserve to the solid waste management operating budget to “cover unforeseen circumstances that impact the landfill disposal, recycling disposal costs and recycling processing fee.
Scottsdale will also make adjustments to its original contract with the Salt River Pima-Maricopa Indian Community to better provide alternative delivery of recyclables.
The need for the deal came about because the Salt River Pima-Maricopa Indian Community Material Recycling Facility suffered a fire on Oct. 26, 2019 that put it out of commission for at least 18-24 months with a worst-case scenario of being totally lost.
Prior to the fire, Scottsdale had delivered all of its recyclable material to the facility since its opening in 2001. In the interim, Scottsdale was sending its recyclables to a landfill at a cost of $27 per ton, leading to a negative variance in the solid waste budget.
SRPMIC is seeking alternative arrangements to processing Scottsdale’s recyclables but hadn’t designated an alternative recycling facility. There are only five facilities in Maricopa County.
With no alternative in place, the city’s Sold Waste Department began searching for alternatives outside of the SRPMIC contract and concluded partnering with Phoenix was the best option.
Phoenix is home to two recycling facilities: North Gateway Material Recovery Facility, 30205 N. Black Canyon Highway, and 27th Avenue Material Recovery Facility, 3060 S. 27th Ave.
Scottsdale also selected Phoenix because the two cities’ recycling programs are similar, meaning there would be no retraining. The distance from the city to the facilities are similar to that of SRPMIC’s facility, though Scottsdale city staff expect a small cost increase for transportation.
With the new agreement, Scottsdale will pay a $75 processing fee for each ton of recycled material delivered to Phoenix facilities. Scottsdale is also anticipating the average quarterly outbound blended rate Phoenix receives from marketing the individual commodities will help offset costs.
Scottsdale city staff anticipate they will pay a net rate of $31.98 per ton. Phoenix city staff estimates Scottsdale will deliver up to 31,200 tons over the next year.
If the market rate for AQOBR increases, Scottsdale will then pay less per ton and vice-versa. Furthermore, Phoenix city staff say Scottsdale doesn’t get any revenue but if recycle market prices increase during the term of the agreement, the two cities would equally split additional revenue.
In order to deliver recyclables to Phoenix, Scottsdale will need to adjust its contract with SRPMIC, which requires the city to deliver at least half its recyclable to SRPMIC’s facility.
The SRPMIC contract also sets for a contractor to haul recyclables to SRPMIC from Scottsdale transfer stations. The city plans to adjust so transfer haulers will transport to the Phoenix facilities.