Letter to the Editor: Reader Urges Council to Vote Down Contract for Evaluating Trash Service

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To the Editor:

$45,377

Ladies and Gentleman, the number above is finally in writing. The proposal can be found on the city website under Mayor/City Council, agenda for next City Council Meeting.

There has not been a single resident that has voiced a need for this evaluation nor has any committee of citizen involvement voiced a need for this evaluation. The cost of this item has not been budgeted and would need to be added to a future Budget Amendment. All items under Task Three lead one to the conclusion that consideration is on the table for the eventual sale of Environmental Services.

Due to previous engagements (i.e. my wife and I will celebrate 32 years of marriage on the night of the Council Meeting) I will not be in attendance at this meeting to voice my opinion once again that this is money ill spent that could go towards so many more items necessary for the greater benefit of the city of O’Fallon and its employees.

I brought this up earlier in these discussions with regards to this expenditure; increase the amount of uniform allowance for all environmental services employees from the paltry sum it is now to a minimum of $500 per employee this year. Also increase the amount of uniform allowance for all O’Fallon Police Department uniform officers and clothing allowances for detectives at a minimum by $500 each.

This would greatly improve the overall morale of both departments, encourage workers to continue working in those departments and recognize their real value by placing money where it counts!

Some on the council have stated that the citizens of O’Fallon do not understand all this going on in the city, that is what elected officials are privileged to know and that we should put our faith and trust in the decisions that the council makes on our behalf. This is a decision that is being taken over the expressed objections of Advisory Green, Public Works and every person that has come before this council in regards to this so-called evaluation. Please do the right thing and kill this resolution at the May 10^th City Council Meeting and place this money that the citizens of O’Fallon entrust to your care in the funds requested above for our dedicated Environmental Services employees and our dedicated O’Fallon Police Department employees.

Below is an excerpt from the agreement, with comment from Nunnery. The full resolution and agreement can be found on the city's website under the agenda for May 10.

Task Three. Appraisal of the Department’s Assets.

• Poletti and Shaw will prepare a valuation of the City’s assets using a “cost” approach. This evaluation will consider the replacement cost of building a comparable transfer station facility, the cost to procure an MDNR permit, and the value of the City’s equipment and containers (there is a market for used equipment)

• The team will also research “comparable” sales, to the extent they exist. Typically,however, transfer stations are acquired as part of a larger acquisition (which could include hauling operations, landfills, and other assets), and the value of the transfer station in this larger purchase is not separately stated. Further, the purchase prices for acquisitions are not always stated because it is proprietary information. The acquisition might also include waste delivery agreements; in the City’s case, the contracted operator secures 3rd party tonnage, not the City, which would also impact the relevant purchase multiple. As a result, while transfer stations are sold in the solid waste industry, there is little “market” data on the value of such transactions that isn’t proprietary to the acquiring companies (each of which has its own investment criteria). Further, such proprietary valuation data often depends on a company’s market position (e.g., availability of landfills, whether the company is already established in a market or entering a market,etc.). With these caveats, the team will nonetheless research and compile transaction information (if it exists) to supplement the “cost” approach valuation.

• Given that the City’s transfer station is privately-operated, the revenue earned by FWCD for 3rd party tonnage (which comprises the majority of waste received at the transfer station) as well as FWCD’s costs to operate the facility and any subsidiary benefits suchas income earned at the landfill are also proprietary. Therefore, we believe that an “income” approach would require numerous assumptions to be made. These assumptions would change for other potential operators of the facility (based on the extent of their local hauling, distance to their landfills, etc). Given the number of assumptions that would have to be made, we don’t believe the “income” approach would be an efficient use of the City’s resources available for this study.

• Using the market assessment data collected under Task Two, we will provide a discussion of the regional marketplace and the qualitative factors in that marketplace that may impact the value of the City’s transfer station.

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My roots are in Missouri, my great grandfather and my great grandmother are both buried in Missouri cemeteries. My ancestors all have been proud contributors to the state of Missouri.

I implore you to vote “NO” on this resolution that will result in nothing more than a continued strain on the taxpayers of O’Fallon and a continued point of discontent among the average citizen of O’Fallon, Missouri.

If it walks like a duck, it quacks like a duck, it looks like a duck, then more probably than not, it is a duck. If we are looking for a one-time windfall of monies to be utilized to fund an unknown entity such as a major/minor league hockey arena or some other venue, then by all means go forward with this “market assessment” cloaked in the form of an “evaluation." If however, you are truly following the voice of the people, then vote a resounding “NO” to Resolution 05-10-2012A. To do anything less is just another way of ignoring the needs of the citizen body of O’Fallon, Missouri.

Michael Nunnery, O'Fallon, MO