Does Multi-municipal Collaboration Improve Your Negotiating Position?

In 2016 the City of Timmins implemented changes to its Blue Box recycling program, based on the findings of a CIF funded performance audit of its transfer station operation. Instead of compacting recyclables, loading them onto highway trailers and hauling the materials to a location 300 kilometers away, the City, after a successful pilot phase, entered into a processing arrangement with a small, local MRF.

Seeking to further improve on these arrangements, the City of Timmins staff reached out to neighbouring municipalities to determine if there was a willingness to work collaboratively to secure competitive processing rates for all parties. Several North Eastern Ontario (NE ON) municipalities were beginning to roll out curbside collection programs targeting the same suite of recyclables as the City of Timmins. This created the opportunity for groups to consolidate tonnage and negotiate as a unified body. For the processor, assurance of a greater number of tonnes over which to amortize costs would allow it to offer lower processing rates. Through this arrangement the City of Timmins would benefit from further reduced rates, other municipalities would have a chance of securing better rates than if they worked alone, and the processor would be able to lock down a greater number of tonnes through a single transaction.

With the possibility of a ‘win, win, win’, the NE ON group gathered around the negotiating table. And, through discussions, the group is seeing the potential for additional benefits:

Minimizing hauling costs

  • The processor’s location will require only short distance hauling for all neigbouring communities, thus minimizing trucking costs, and

Shared P&E efforts

  • Harmonized programming is likely to allow for common P&E campaigns with shared costs, and

Optimized collection routing

  • Geographic proximity opens the door to the opportunity to optimize routing, over time. Where the sharing of routes across municipal boundaries allows for costs savings, the group can build on its existing relationship for negotiations. The harmonized programs and shared end processor can facilitate these arrangements.

The NE ON partnership has begun negotiations and is currently considering its first offer. For this group, the question: “does multi-municipal collaboration improve your negotiating position”, the answer is “yes”. When there is a win for parties on all sides of the table, it’s well worth working together. The key to a successful cooperative effort is to clearly define and communicate the benefits for each group. It’s the win that draws groups to work together and secures commitments to join forces to leverage a combined position.

For more information, please contact Jessica Landry.