How to improve contracting for municipal solid waste and recycling services

Many municipalities contract with private-sector firms for solid waste and recycling collection services to provide an efficient and cost-effective essential service to residents. Generally, municipalities that already contract for these services tend to fall back on previously established contracting decisions and processes, missing an opportunity to improve the services.

Even if the contracting process is effective, negotiating offers potential opportunities for improving the contract and securing more flexible service options, as well as improving the value of the contracted collection services.

Basics of contracting

Properly planning the contracting process is essential to achieving a positive outcome. Some basic guidelines should be followed to simplify, optimize and initiate a successful request for bids (RFBs) or request for proposals (RFPs) for solid waste and recycling collection contracts.

A first step should be obtaining legal guidance concerning the procurement process and determining the preferred and applicable procurement process to obtain bids or proposals. This process is specific to the local government, and each brings its own pros and cons.

Next will be determining the approximate timeline needed for the procurement process. To do so, consider matters such as expiration of any existing contracts for services; public notice requirements; documents preparation; input of the legal team concerning the process; time needed for companies to respond to an RFB or RFP; legal review of submitted bids or proposals; review of bids or proposals for completeness, services provided and costs; determination of “best” bid or proposal; contract approval process and time required for the selected company to obtain any needed equipment and personnel; and transition time required if a new company is selected to provide the services.

Municipalities should obtain prior input from residents and municipal employees concerning possible options for improving the contracted services, minimizing cost of services and preparing a summary of the options. After the completion of this step, they can then develop a list of potential companies that can respond to the RFB or RFP and provide the services needed.

Following these steps will incentivize haulers to generate original, thoughtful bids or proposals that should result in long-term, win-win partnerships.

Improving contracted services

The goal of improving and fine-tuning the contracted services should focus on possible changes that enhance the value of the services without substantially increasing their costs.

Possible changes could include service frequency, containers, bulk collection, discounts, pricing and more. Frequency of service and whether it’s appropriate for the community are the most important factors to consider. Frequency is one of the most important drivers of collection costs. Many urban municipalities require trash collection on a twice-a-week basis; however, a significant number of residents could not choose or need a second day of service.

Obtaining pricing for both once- and twice-a-week service as part of the procurement process will allow the municipality to make a value-driven decision about the contracted frequency of service.

The same logic can be applied to the frequency of collection for recyclables. While many municipalities use once-a-week service for the collection of recyclables, requesting pricing for once-per-week and every-other-week collection enables municipalities to choose the best service option based on both cost and the needs of residents.

Another important service decision to consider as part of the procurement process is the option to have the contracted company provide rolling carts for residents to use when placing their trash or recyclables out for collection versus residents providing their own containers. The use of rolling carts provided by the hauler eliminates the need for the residents to provide trash containers and standardizes the type of containers to be serviced.

Messaging is important, and it is highly recommended that the municipality retain its logo on all containers provided by the contractor to maintain consistent messaging across all aspects of its solid waste system. Standardized attributes provide the opportunity to use semiautomated or fully automated collection vehicles, which are more efficient than traditional rear-end load trucks.

Increased efficiency in collection vehicles could result in cost savings for the municipality. As part of this decision, municipalities will want to consider whether residents have room on their properties to keep the carts and if the existing street and parking situations allow the carts to be serviced easily.

Some municipalities use pay-as-you-throw (PAYT) systems, which provide the opportunity for cost savings for residents who do not generate significant quantities of trash. These PAYT systems generally allow residents to purchase specially identified bags from the municipality to use when placing trash out for collection.

Including an option for providing a discount on the contracted collection price for senior citizens is a generally accepted practice in many municipalities. However, the option must be included in the RFB or RFP process.

Similarly, including an option for annual or semiannual bulk collection events with specified maximum volume quantities for each household is another option to consider as part of the procurement process. The event and quantity limits will help ensure the actual cost and rate of the service is minimized.

Finally, many municipalities will require the contracted collection company to provide a performance bond or other financial guarantee to ensure it performs the required services adequately and in accordance with the contract requirements. The cost for the company to provide the performance guarantee is generally passed along to the municipality as part of the contracted service rates.

An evaluation of the companies expected to respond to the procurement process and the likelihood that they will not perform the required services adequately is useful when determining the required value of the guarantee.

Incorporating flexibility

Flexibility is a critical consideration in the development of residential hauling contracts. One commonly employed approach is to allow for adaptability in the materials accepted by the recycling program. Rather than specifying acceptable recyclable materials directly within the contract, it is advisable to reference an official list maintained by the solid waste director or a comparable municipal authority.

This practice enables counties, towns and cities to respond effectively to fluctuations in recycling market conditions, such as decreases in the value of glass or evolving standards regarding acceptable materials. Flexibility also facilitates timely adjustments in response to advancements in waste management technologies, including innovations in logistics and the adoption of new processing equipment.

Modernizing contract negotiation

In today’s dynamic waste and recycling landscape, contract negotiation is no longer just about securing basic hauling terms. It’s a strategic process driven by data, technology and sustainability goals, and it’s designed to ensure services are responsive, efficient and aligned with community needs. A number of emerging trends are serving to transform residential collection contracts:

• Generative and agentic artificial intelligence (AI) in procurement. AI can draft and analyze hauling contracts, flag risk clauses and suggest optimized service terms based on prior municipal data and vendor history. Large-scale adoption across an organization is not prevalent, though many companies are in the early stages of use development. While not contract-specific, the Solid Waste Association of North America’s AI Integration Report highlights how AI is being used. These tools directly inform service-level agreements and performance metrics in hauling contracts.
• Legal playbooks specific to waste. AI-generated negotiation frameworks are customizable for solid waste and recycling, offering municipalities a faster way to respond to vendor proposals and ensure regulatory compliance.
• Cloud-based collaboration tool. Virtual negotiation platforms allow shared editing of contract drafts, clear tracking of term revisions and faster input from stakeholders from finance to legal.
• Performance-driven contracting metrics. Contracts now include dynamic metrics—such as diversion rates, contamination thresholds and routing efficiency—to reward contractors for good performance.

Strategic shifts

In cities and counties across the country, the mindset surrounding negotiation has shifted strategically.

Municipalities are focusing on partnering over policing, focusing on vendor relationships that encourage innovation, such as adopting new vehicles, smart bins or AI-powered contamination detection.

They’re using pilot agreements and phased rollouts to test new service models, such as organics collection or bag-based recycling, before full deployment.

They’re also building contract checkpoints such as walk-away timelines and accountability reviews to ensure services stay on track and allow for corrective actions or reevaluation without long-term commitments.

Municipal contracts increasingly are including terms supporting carbon reduction, fuel efficiency and social equity. And contract life cycle management systems are being integrated to link billing, customer service and work-order software, ensuring seamless operational oversight for municipalities.

Implementation tasks

Successful negotiation is just the beginning—implementation defines impact, and critical execution elements now are woven into modern contracts.

Successful implementation will include designing efficient collection routes using computerized logistics tools, then preparing operations teams to execute those routes. The procurement planning process will involve defining requirements for equipment, including containers, trucks and hardware, such as performance features and outlining a purchasing strategy.

Downstream services and facilities will require coordination and a diversion plan created that details strategies to maximize the diversion of recyclables from landfills.

A public outreach and education strategy will require crafting a communications plan to notify residents of service changes and fulfill mandated outreach obligations.

Finally, data and analytics frameworks will need to be developed to outline how solid waste and recycling data will be gathered, quantified and tracked—from curb to processor—to enable transparent reporting and informed decision-making.

Together, these practices support a smarter, more responsive approach to residential waste and recycling.

Chris Lund is executive vice president, and Sam Lybrand is principal associate at Vienna, Virginia-based solid waste consulting firm Gershman, Brickner & Bratton Inc. They can be reached at clund@gbbinc.com and slybrand@gbbinc.com, respectively.