Recycling contract back with new terms

Montgomery might trade profits for steady fees

May 27, 1999|By Candus Thomson | Candus Thomson,SUN STAFF

ROCKVILLE -- Montgomery County's ambitious recycling program is back on track, just one week after Executive Douglas M. Duncan declared it dead at the hands of "crazy" environmentalists and the County Council.

A beaming Duncan, flanked by members of the council, announced the terms of a new contract with Office Paper Systems of Gaithersburg that would help the county meet its goal of 50 percent recycling by the end of next year.

"We can now move forward," said council President Isiah Leggett, who brokered the deal after Duncan's outburst at a news conference last week.

Duncan, who vowed he would not reopen negotiations, said he realized he could "stick to my beliefs and watch it die or pick up the pieces and get it approved."

The council will vote today on the contract.

County officials say they gave up the potential to make a profit on the sale of mixed paper -- catalogs, cardboard and magazines -- in return for guaranteed costs over the life of the 15-year deal.

Montgomery will pay about $15 per ton, or $1.35 million, for collection of up to 90,000 tons, and then $12 per ton over that amount.

The contract rejected by the council required the county to pay for 115,000 tons no matter how much was collected and based the cost on the market price of recycled paper.

Estimates by county analysts put the annual tonnage at closer to 70,000, meaning ratepayers could have been stuck with a bill of $400,000 a year for paper not collected.

OPS will keep all revenue from the sale of paper instead of returning 65 percent to the county.

Under the terms of the new contract, the county will provide a $1.2 million bailout for OPS, which has acknowledged in its prospectus that it has "limited assets."

The interest-free loan to OPS will be paid back in the form of reduced fees over seven years.

Pub Date: 5/27/99

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