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Belfast City Council Report To: Health and Environmental Service

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Belfast City Council Report To: Health and Environmental Service Belfast City Council Report to: Health and Environmental Service Committee Subject: Award of Contracts for Municipal Waste Disposal Date: 3rd September, 2014 Reporting Officer: Tim Walker, Head of Waste Management, ext 3311 Contact Officer: Brendan Murray, Waste Manager – Service Planning & Delivery, ext 3333 1 Purpose of Report 1.1 To advise the Committee of the outcome of an evaluation exercise by arc21 on behalf of its constituent councils to secure municipal waste disposal contracts (landfill service contracts) from October 2014 for a period of nine months. 2 Background 2.1 Members will be aware that the Council has been working with its neighbouring councils through a secretariat known as arc21 for many years to procure and introduce a range of new waste management facilities. 2.2 The purpose of this arrangement has been to deliver economies of scale for the recycling, treatment and disposal of the 11 constituent councils’ wastes and to comply principally with the EU’s Landfill and Waste Framework Directives. These pieces of legislation were introduced to (i) substantially divert the amount of waste sent to landfill up until 2020 and (ii) to deliver significant increases in recycling. 2.3 Having been approved by the arc21 Joint Committee on 28 August, this report presents the results of a procurement exercise in relation to the appointment of service suppliers for municipal waste disposal for the constituent councils for consideration. 3 Key Issues 3.1 Having identified the requirement to renew the municipal waste disposal contracts from 1st October 2014, a tender exercise was started in accordance with the EU Open Procedure on 24th June 2014 by placing a Tender Notice in the Official Journal of the European Union, followed by local press advertisements and an advertisement on the arc21 website. 3.2 This informed the market of the requirements of the arc21 councils in respect of landfill services to be provided in two lots for a nine month period to July 2015, with possible extensions up to April, 2016. 3.3 Following receipt of submissions, an evaluation exercise was conducted and the lots were apportioned to the constituent councils which are now taking this report through their appropriate decision-making bodies. The tender evaluation report is attached. 4 Resource Implications Financial Implications 4.1 The estimated cost of this service is within the Council’s budget for the term of the contract, and its extension if drawn upon. 4.2 Human Resources None 5 Equality and Good Relations Implications 5.1 None. 6 Recommendation 6.1 The Committee is requested to consider the tender evaluation report and endorse its submission to the Joint Committee. 6 Document Attached Municipal Waste Disposal Contracts – Lots 1 & 2 Municipal Waste Disposal Contracts – Lots 1 & 2 Tender Report August 2014 CONTENTS 1.0 PURPOSE 2.0 BACKGROUND 3.0 CONTRACTUAL ISSUES 4.0 PROCESS 5.0 CONCLUSIONS 6.0 RECOMMENDATIONS Municipal Waste Disposal Tender Report 1.0 Purpose To make recommendations arising from tender action for a Municipal Waste Disposal Contracts for arc21. 2.0 Background Having identified the requirement for the renewal of the Municipal Waste Disposal Contract from 1st October 2014, tender action was initiated in accordance with the EU Open Procedure on the 24 June 2014 by the placing of a Tender Notice in the Official Journal of the European Union followed by local press advertisements and an advertisement on the arc21 website. 3.0 Contractual Issues 3.1 Tender Documents The main elements of the tender documents are as follows: 3.1.1 Invitation to Tender The Invitation to Tender document sets out the Authority’s requirements and explains the format in which responses are to be made by interested suppliers. arc21’s requirements were divided into two separate Lots as follows: (a) Lot 1: for the disposal in landfill with a guaranteed available capacity of 150,000 tonnes; (b) Lot 2: for the disposal in landfill with a guaranteed available capacity of 60,000 tonnes; There is a separate competition conducted in respect of each of these two lots. 3.1.2 Specification The specification was designed as a performance specification requiring Tenderers to demonstrate through a Service Delivery Plan how the Client’s requirements would be met. 3.1.3 Objective To provide services for the disposal of residual municipal waste in landfill, via a delivery site located within the arc21 area; and To collect data and report on the quantity and type of material disposed by that method. 3.1.4 Conditions of Contract / Pricing Mechanism. (a) Service contract for the disposal of municipal waste in landfill to a single nominated delivery site per lot. (b) Payment based on Price per Tonne of Feedstock Material disposed of as a charge to the Authority per Lot. (c) No exclusivity and no minimum tonnage guaranteed by the Authority however required Guaranteed Available Capacity for each lot should be provided at the single delivery site. (d) Contract for an initial period of nine months with service commencing 1st October 2014, with optional extensions for any one or more Lots for any period or periods up to nine months. (e) Default Schedule of Penalties applied for non-performance. 4.0 Process 4.1 Tenders Received Two tender submissions were returned by the closing date of 15:00, 11th August 2014, for all Lots. The submissions were from: Biffa Waste Services Ltd; and Alpha Resource Management Ltd. 4.2 Evaluation The tenders were evaluated in accordance with the criteria stated in the tender documents. The weightings of the cost and technical assessment sections were 70% and 30% respectively. 4.3 Completeness The tender submissions were checked for completeness and found to be satisfactory and capable of acceptance. 4.4 Cost Evaluation Cost Evaluation scores for each Tender for each Lot 1 and 2 was calculated according to the following formula: Total Solution Costs Per Tonne = Gate Fee Per Tonne + Transport Cost Per Tonne Tender Score = (lowest Total Solution Cost Per Tonne received in a Tender for a Lot divided by Total Solution Cost Per Tonne tendered for the Lot) multiplied by 70 4.5 Technical and Quality The evaluation panel reviewed the Service Delivery Plan of the submissions for each Lot, which included a review of the compliance with the Contract Specification. All tenders were found to meet the requirements. The following elements were evaluated: Material Acceptance Arrangements; Recording of Feedstock Materials; Reporting; Communication and Complaints Handling; Contingency Arrangements; and Health and Safety Plan. 4.6 Contract Award – Allocation of Lots The process concluded with a procedure outlined in the tender documentation to ensure that no lot(s) are awarded to a Contractor who is unable to provide the requisite aggregated guaranteed available capacity. 5.0 Conclusions 5.1 As outlined above, each of the process steps was undertaken in accordance with the criteria set out in the tender documents and the rates of the most economically advantageous tenderer for each lot is as follows 5.2 Lot 1 – Ards Borough Council, Belfast City Council, Castlereagh Borough Council, Lisburn City Council and North Down Borough Council: Following completion of the process set out in the tender documents the contract for this lot is proposed to be awarded to Alpha Resources Management Ltd at the tendered gate fee per tonne is £11.60 for an initial period of nine months with service commencing 1st October 2014, with optional extensions for any period or periods of up to nine months. 5.3 Lot 2 – Antrim Borough Council, Ballymena Borough Council, Carrickfergus Borough Council, Larne Borough Council and Newtownabbey Borough Council: Following completion of the process set out in the tender documents the contract for this lot is proposed to be awarded to Biffa Waste Services Ltd at the tendered gate fee per tonne is £14.75 for an initial period of nine months with service commencing 1st October 2014, with optional extensions for any period or periods of up to nine months. 6.0 Recommendation 6.1 A contract is awarded to Alpha Resource Management Ltd for Lot 1 for the disposal of Municipal Waste at the Mullaghglass Landfill Site, for a period of 9 months with optional extensions of up to 9 months. 6.1 A contract is awarded to Biffa Waste Services Ltd for Lot 2 for the disposal of Municipal Waste at the Cottonmount Landfill Site, for a period of 9 months with optional extensions of up to 9 months. 6.3 Subject to Joint Committee’s approval, the recommendations are then considered as soon as possible by each Council in accordance with the governance arrangements and overarching legal requirements..
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