Brief

Republic pushes for contract extension in Las Vegas as competitor asks for open bid

Dive Brief:

  • The Las Vegas City Council is set to introduce an ordinance on Feb. 15 that will begin the process of negotiating a potential 15-year contract extension with Republic Services. The current contract doesn't expire until 2021, but Republic wants to ensure long-term stability before investing in a new single-stream collection system, as reported by the Las Vegas Review-Journal.
  • Las Vegas is the last municipality in Southern Nevada without single-stream and isn't willing to wait until 2021 for this to change. A Republic consultant estimated that making the switch would require $50 million due to the cost of 350,000 new carts and additional trucks. 
  • Local hauler Western Elite is advocating for the city to have a public bid process rather than moving directly into renewal negotiations. The company would be interested in a 5- to 10-year contract.

Dive Insight:

Republic has held the exclusive rights to collect in Las Vegas since at least 1985, as well as North Las Vegas, Henderson and Clark County. This has made Republic a frequent target for criticism over its pricing and legal complaints alleging anti-competitive or illegal practices in the past. As a regional landfill operator, known for being less expensive than Republic's Apex landfill in the past, Western Elite has been one of the company's more vocal opponents.

Western Elite has argued the need for a new collection system means any company could technically come in to take over recycling for Las Vegas, though Republic has been dismissive of their capabilities. Based on infrastructure alone Republic's operation in the state is much bigger. Republic's new Southern Nevada Recycling Center is said to be one of the largest and most advanced of its kind in the U.S. The company has also touted its estimated $230 effect on the state economy in a recently released report.

Based on this large presence, Nevada has been looking to Republic for help increasing its diversion rate from around 24%. As a large city with high volumes of tourist traffic, Las Vegas will be a key part of making this work. If the bidding process remains closed it may never be known whether or not a different company could achieve better results.

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Filed Under: Corporate News Recycling