Monday, May 2, 2016

Rumpke's 8% garbage-rate increase doesn't quite add up; mayor reviewing proposed contract, sees no ill intent

By Molly Elifritz
University of Kentucky School of Journalism and Media

Last Monday, the Midway City Council authorized Mayor Grayson Vandegrift to sign a contract with Rumpke Waste and Recycling that contained an 8 percent price increase for residential customers. The price increase means that the current rate of $11.95 would escalate to $12.91.

During the meeting, Rumpke representative Stacey Chambers said the 8 percent price inflation for residential customers was a reflection of the Consumer Price Index. In an interview, Chambers said that the price increase was a representation of the CPI over the past four years as well as an estimation of where the CPI will be in the next two years, after the contract renewal.

However, the CPI has risen only 3.7 percent since 2012, and according to the Federal Reserve System estimates, it is expected to rise 1.5 percent this year and 2.2 percent next year. That would put the projected CPI at 7.4 percent, not 8 percent. (Compounded, the ultimate rate would be 7.57 percent.)

When asked about Rumpke's estimated CPI, Mayor Grayson Vandegrift said, “We will study the CPI closer and kind of get a better idea about exactly why Rumpke feels the charge is necessary.”

Vandegrift said he noticed the 96-cent monthly increase a few weeks ago when he was presented with the raw numbers of the new contract but “I didn’t know they were basing that figure off the CPI until the council meeting.” Being a man of business, Vandegrift said, he understands that “unfortunately” prices increase as the economy grows.

After looking into what other companies are charging, Vandegrift still believes that Rumpke is offering a competitive price and most importantly, good services.

“From what I have found in the past, Rumpke is a much more competitive company than a lot of others and they offer, in my opinion, probably a better service than a lot of companies do because they are really easy to work with,” said Vandegrift.

Although the council authorized Vandegrift to sign the Rumpke contract, he isn’t ready to sign on the dotted line just yet. “Just like any other contract, I always go in and check things before we do,” he said. Vandegrift said the contract should call for rebidding in 2018.

Vandegrift said that this isn’t the first time that the city has delayed the signing of a contract. Just last year Vandegrift chose to restrain from signing an easement for Columbia Gas of Kentucky, to build a new regulator, until the company fixed a poor paving job in front of the Midway Grocery. “We’ll have to get this settled out before I sign anything,” said Vandegrift.

Vandegrift seems to think that the contradicting numbers stem from miscommunication. “I really don’t think there was any ill intent in not letting us know about the CPI aspect of it. If anything there is a chance our wires got crossed,” he said.

Vandegrift said that the council gave him the authority to execute the contract because no matter what, everyone “unanimously” felt like they were getting a good service. “Overall their service has been excellent; they’ve always been open and honest with us.”

Rumpke is a privately owned waste and recycling company, based north of Cincinnati, that provides services to commercial and residential properties throughout Kentucky, Ohio, Indiana and West Virginia.

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