Council Votes to Increase City’s Costs $100,000
In a special called meeting on Tuesday, July 17, the Lexington City Council voted unanimously to accept a bid from a local company that will cost the city $20,000 a year more than the lowest bid submitted, for a total of $100,000 over the life of the 5-year contract.
The special meeting was called specifically to discuss the three bids submitted for the city’s waste collection (i.e. trash pick up). The companies that submitted bids were Texas Disposal Systems, Allied Waste, and LAI Disposal.
Texas Disposal, from Austin who just won the bid for the City of Giddings, was the highest bidder. LAI, a local company managed and owned by Brad Dominy and Sonny Owen, was the second highest bidder, and Allied Waste, who has had the contract with the city for at least the last ten years, was the low bidder.
A motion was made by Tim Brown to award the contract to LAI, based on them being a local company and due to billing problems with Allied Waste. It was second by Opal Lewis. The motion passed 5-0.
Members of the City Council questioned the representative of Allied Waste, asking why their bid was lower than their current contract. The representative explained that when they first got the Lexington contract, they did not have many accounts between their home office and Lexington and since then, they have expanded their business in the area, lowering costs. Also, he said that the containers which residents have are now paid for, which also reduces their costs.
Although all three companies are required to hold their price for two years, Allied said they would hold their bid for the full five years of the contract. When the Leader asked LAI if they would be willing to guarantee their price for the entire five year contract, they said no.
Local company, LAI, has been in business 13 months and have approximately 700 customers. With the City of Lexington, they will expand their services to approximately 600 more customers, almost doubling their business. They have six trucks and five employees, four full-time and one part-time. With the City’s contract over the next five years, they hope to hire up to four more local people.
Brad Dominy said, “We’ve done our homework. We got a copy of the Allied contract and gave the City Council a heads up in January, letting them know that the City needed to give Allied a 90 day notice to keep their contract with Allied from automatically renewing. We also went back to the City a few months ago, and gave council members a packet that included copies of Allied invoices to the City, highlighting mistakes Allied had made that were costing the city money.”
The City reported that Allied corrected the billing problems.
After the vote had been taken, Tim Kleinschmidt, the City Attorney, said that he wasn’t sure the vote was legal, as State law requires a municipality to award contracts to the lowest responsible bidder. However, the next day, after researching the law, Kleinschmidt said the garbage contract did not fall in this category and did not have to be put out for bid; therefore, the bid can be accepted and the contract let.
The contract is expected to be signed after the next City Council meeting.