PORT ANGELES — The City of Port Angeles will pay Waste Connections Inc. $1.99 million over the next two years after the two parties reached a settlement, city officials announced Friday.
The settlement was reached with the assistance of a mediator and has resolved claims made by the Texas-based Waste Connections Inc (WCI) in June 2020 that the City of Port Angeles was in breach of its contract and owed the company approximately $4.8 million.
“The City recognized that WCI had at least one valid claim,” City Attorney Bill Bloor said. “The City did owe some amount to WCI and intended to pay what was due.
“Therefore, the City, whether it continued the court action or not, would pay something to WCI in the end. The question was ‘how much’. ”
Bloor said city officials needed to weigh multiple factors in deciding how far to take the settlement.
“The City also recognized that continuing through a trial generates additional costs and expenses, and the outcome is not certain. After analyzing all these factors, the City concluded that the settlement was more fiscally responsible,” Bloor said.
City officials ultimately agreed to pay WCI a total of $1,990,000 over the course of two years while WCI will be required to limit construction and operation at its current facility in Clallam County and abandon development plans for a solid waste transfer station in Carlsborg.
The Port Angeles City Council approved the settlement in its consent agenda on Tuesday.
The city’s termination of the contract and WCI’s proposal to build the Carlsborg transfer station generated two new lawsuits which this resolves, the settlement being reached in concert with Citizens for Carlsborg and the Peninsula Trails Coalition.
Bloor said the money will come from the solid waste fund.
“The point is that the City does not plan to increase solid waste rates at this time,” Bloor said.
According to a city press release on Friday, the dispute with WCI began in 2017, when “WCI asserted a series of claims that it was entitled to additional compensation under its contract with the City.”
Bloor said that WCI claimed the City breached a 2005 Services Agreement by not increasing compensation to WCI in several cost categories.
At the time, city officials said that to fulfill WCI’s additional compensation would require increases in customer rates to use the Regional Transfer Station in eastern Clallam County which they did not want to do.
Ultimately, the two entities could not come to an agreement launching the multi-year dispute resulting in the City terminating its agreement with WCI, giving notice in March 2021 that it would do by Oct. 2 — a date that was delayed — and offering solid waste services itself.
Port Angeles offers full solid waste services including recycling and yard waste collection within city limits and full operation of the Regional Transfer Station and Blue Mountain Transfer Station, which serve residents of both Port Angeles and Clallam County.
Port Angeles took over these services in March 2022 — except for glass recycling, which is still under consideration. Officials said that by performing these services in-house, they can ensure that utility rates are as low as possible and are discussed in an open and transparent process through Cost of Service Analysis (COSA).
“From the onset of our discussions and negotiations with Waste Connections, Inc., the City of Port Angeles has prioritized affordability to the citizens of Port Angeles and Clallam County, City Manager Nathan West said in the release.
Issues with WCI did not end there. Not long after the city terminated its contract with WCI, the corporation initiated a process to construct a new solid waste transfer station in Carlsborg, which was firmly objected to and rejected by the City of Port Angles, the Peninsula Trails Coalition and the community group Citizens for Carlsborg.
WCI’s attempt to develop a new transfer station became a very large concern as the proposed location for the transfer station was located adjacent to the Olympic Discovery Trail and would have negatively impacted the trail and the surrounding community.
Jeff Bohman, President of the Peninsula Trails coalition said in the press release that the coalition is pleased with the outcome of the settlement.
“This settlement protects the trail, ensures regional waste and recycling activities are properly planned and implemented and helps limit utility costs that many of our members and supporters pay,” he said.