Allied Waste Outlines $42 Million Savings, Fast-Track Timeline For Single-Stream...

Allied Waste Outlines $42 Million Savings, Fast-Track Timeline For Single-Stream Recycling in San Mateo County

State-of-the-art equipment with full operation by 2010 saves
ratepayers millions, adding to savings from Allied's lowest-cost
collection bid, Alternative Proposal
SAN CARLOS, Calif.--(Business Wire)--
Allied Waste today provided details of a plan that would allow the
12 Member communities of the South Bayside Waste Management Authority
(SBWMA) to switch to single-stream recycling in less than a year,
without the need for the $53 million new facility proposed by the
SBWMA.

In a letter to officials of the 12 communities, Allied gave
specifics of the plan under which state-of-the-art equipment would be
installed in the existing Shoreway Recycling and Disposal Center
facility in San Carlos at a cost of $7.6 million.

The Allied plan also calls for a simple 10,000-square-foot
extension of the existing 50,000 square foot Shoreway facility. We
estimate construction to cost about $2 million and we allow another
$1.4 million for any additional site work, permits, environmental
enhancements, learning center improvements, etc. Thus, the total
overall project cost would be approximately $11 million.

"In March, the SBWMA estimated that switching to single-stream
recycling would cost approximately $20 million," said Evan Boyd,
General Manager of Allied Waste of San Mateo County. "We didn't submit
our own plan at the time because that seemed fairly reasonable. But
when their estimate grew to $41.5 million in April and finally to
$53.9 million in June, we became concerned. We knew the job could be
done for far less, and we developed this $11 million plan."

The 25-tons-per-hour system, manufactured by Bulk Handling Systems
(BHS) of Eugene, Ore., would be capable of handling the projected
80,000 tons of recyclable waste per year. This would be more than
enough to meet all the projected demands of the SBWMA. The BHS
equipment produces high quality commodities for resale that will fetch
high prices for the SBWMA and its members, helping to offset future
rate increases.

In addition, the new equipment could allow the SBWMA to offer
single-stream recycling to commercial customers, dramatically
increasing the recycling levels in San Mateo County. The new
processing equipment could be fully operational in nine months from
the time it is ordered. Even with the extension of the existing
structure, the County could begin single-stream recycling as early as
2010, ahead of the SBWMA schedule.

Allied's cost-saving plan for Shoreway is one of several proposals
from the company that would save ratepayers tens of millions of
dollars and support San Mateo County's goal of becoming the greenest
county in the state.

Allied, which has served San Mateo County's waste disposal needs
for 35 years, submitted the lowest-cost bid for collection of waste
starting in 2011. Allied's bid was passed over by the SBWMA, despite
being $1.3 million per year below the recommended bidder, while
meeting, if not exceeding all the service demands in the RFP. It was
the only plan that included direct recycling incentives for
single-family households and the only plan to include CNG-fueled
vehicles in its fleet as well as biodiesel.

In addition, Allied put forth an Alternative Proposal that would
save ratepayers another $12 million. Although such alternatives were
specifically encouraged in section 3.16 of the SBWMA RFP, Allied's
proposal was not considered.

"We don't understand why our Alternative Proposal wasn't
considered, given that it will save ratepayers millions of dollars,"
said Jeff Andrews, Senior Vice President, Western Operations for
Allied Waste Services. "At the same time, our organization has serious
concerns regarding the rapidly escalating costs of the proposed
construction to the Shoreway facility, particularly given the current
economic climate. With millions on the line for ratepayers, it's
important that these decisions are made in the best interest of the
residents and businesses of San Mateo County."

Allied Waste
Evan E. Boyd, 650-596-6401
Evan.Boyd@awin.com

Copyright Business Wire 2008