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Mpls. opts for nonprofit recycler over nation's largest waste firm

Above: Equipment operator Marcella Ramirez moved a load of cardboard at Eureka Recycle on Friday, November 15, 2013 (Renee Jones Schneider)

Updated at 8:38 p.m.

A local nonprofit will soon begin sorting and selling Minneapolis’ recyclable materials, after the city opted not to sign a new contract with the nation’s largest waste company.

The City Council voted Friday to sign a five-year contract with Minneapolis-based Eureka Recycling to process the plastics, metals, paper and bottles tossed out by the city’s residents. The recycling contract is worth more than $1 million a year, though sale of the materials has traditionally more than offset the city’s costs.

The city currently works with Texas-based Waste Management, which has a plant in northeast Minneapolis. Waste Management vied with Eureka for the new contract, spurring environmental groups to highlight Eureka’s treatment of workers and commitment to reducing waste.

The two companies are among four firms seeking a five-year contract with St. Paul, which is now serviced by Eureka. That city has not yet made a decision.

“There’s obviously some incredibly high expectations in the community, and there’s a sense that Eureka can do amazing things,” Council Member Cam Gordon said at Friday’s council meeting. “And can do more than just market and process our recycling, but maybe be a great partner in helping us accomplish our zero-waste goals.”

City staff members had recommended Eureka on financial grounds, however, because the company proposed a lower processing cost and agreed to forgo revenue when costs exceed the value of materials. Those financial arrangements are particularly important in today’s recycling climate, in which weakened Chinese demand for materials has erased some profits cities have used to keep rates low for consumers.

“Currently, recycling materials markets are depressed, and they offer limited revenue,” David Herberholz, the city’s solid waste and recycling director, told a City Council committee last week. “And, unfortunately, there’s not really a good forecast for improvement this year. So, therefore, securing an agreement with the lowest proposed processing fee limits the city’s risk during the term of this agreement.”

City staff members did not respond to an inquiry Friday about when Eureka will take over the service. The city’s request for proposals outlined several possible start dates, the earliest of which is November 2016.

In addition to St. Paul, Eureka now serves Roseville, Lauderdale and some trash-hauling companies that lack their own processing facilities.

Waste Management is the nation’s largest waste-processing firm, with facilities across the country. Its opponents in Minneapolis highlighted that the company operates more landfills than recycling facilities, including several around Minnesota.

Proponents of the switch to Eureka also highlighted the nonprofit’s use of full-time employees — rather than temporary labor common at other plants — who receive benefits including health insurance and sick leave. Minneapolis and St. Paul are studying measures that would mandate that private companies offer sick leave.

Eureka representatives wrote on the company’s Facebook page on Friday that they are “humbled by the community interest in the Minneapolis recycling processing contract and have been wowed by the outpouring of positive support.”

Council Member Kevin Reich, chairman of the council’s Transportation and Public Works Committee, will co-host an event with Eureka on Feb. 17 to discuss how recycling impacts the local economy. It will be held at 6:30 p.m. at the Northeast Library.


Eric Roper • 612-673-1732

Twitter: @StribRoper

Car2Go proposes smaller Minneapolis service area

Above: A Car2Go vehicle in Vancouver (Flikr/stephen_rees)

Car sharing service Car2Go plans to reduce their service area in Minneapolis, leaving the blue and white Smart cars largely unavailable in the North Side and near the city's southern border.

The proposed change follows a similar downsizing plan in St. Paul, but comes with a twist: The company said it will create several remote stations to help serve those areas outside the new limits. That hybrid model has not been used in other cities where Car2Go has reduced its service, the company said.

The proposed reduction to the company's service area (below) follows the City Council's vote Friday to officially license and regulate car sharing, which previously operated under a pilot program. That licensing means the service area and remote hubs will be subject to public works approval.

The company, owned by Smart car manufacturer Daimler, has operated in Minneapolis since 2013 and St. Paul since 2014. It currently has more than 25,000 members in the Twin Cities, who locate the cars on their smartphones and can then leave them at any legal on-street parking space in the service area.

Car2Go Twin Cities General Manager Josh Johnson said their intent is to focus service on higher-usage areas where the cars get more use. They hope it will improve the availability of cars to people using the service.

Above: Car2Go's map of its proposed service area change.

But the proposal to cut off most of the North Side -- the most economically depressed area of the city -- drew criticism this August from Council Member Blong Yang, who called it "unfair and inequitable.”

"It wasn't based on low-income neighborhoods. It wasn't based ont he demographics or anything like that," Johnson said. "It was solely based on member feedback and...studying our market for the past two and a half years. The evaluation is strictly based on that. It's critical to continue to grow here and [make] our business sustainable."

Johnson said cars parked outside the proposed service area sat unused 74 percent longer than the rest of the fleet.

"By proposing these changes, we believe that this is going to help ensure the vehicles are in constant circulation," Johnson said. "That we can make sure that we're not taking up space in some of those areas where we saw the lower utilization."

Yang said Friday that while he's unhappy about his constituents who will lose service, the remote stations are a step in the right direction. “It’s making it a little bit more accessible than it would normally have been if they just were allowed to … cherry pick," Yang said.

The location of the remote hubs has yet to be determined, though Johnson expects there will be three on both the north and south sides -- likely on-street parking spots. The new area cuts off at West Broadway in north Minneapolis, Lowry Avenue in Northeast, 54th Street in south Minneapolis and west of Xerxes Ave.

Nice Ride, the city's bike share operation, has dealt with similar problems with servicing lower-ridership areas. The company, which receives federal subsidies for capital costs, has built several stations on the North Side.

Below: Car2Go's new service area in St. Paul, which has yet to take effect.

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