Orgaworld contract created unnecessary costs: audit
Posted Jul 9, 2014 09:40:52 AM.
This article is more than 5 years old.
OTTAWA – An audit into Ottawa’s green bin recycling contract with Orgaworld shows the agreement created unnecessary costs.
Auditor General Ken Hughes released the report Wednesday, which said the agreement incurred $7 million in unnecessary spending and that amount could go even higher in the coming years.
“Ottawa has been paying a premium to send some of its leaf and yard waste to Orgaworld on one hand while not being able to meet guaranteed volumes at the plant on the other,” said Mr. Hughes on the tabling of his report to Council. “Together these penalties to date total $7.7 million.”
Hughes told council there were fundamental city staff errors, including incomplete pilot project analysis, as well as important documents and information missing.
He said the amount of organics the city should have guaranteed to compost is up to 57,000 tones —- not the 80,000 guaranteed in the contract.
“City staff gave the impression that 100,000 tonnes was easily achievable, had little discussion of options and did not properly identify the risks to Council,” said Mr. Hughes.
The City of Ottawa entered into a 20 year recycling contract with Orgaworld worth over $140 million dollars to handle 80,000 to 100,000 tonnes a year of organic waste.
He also believes the city overspent on legal fees by $1.4 million.
The audit, which began in 2011, makes ten recommendations, all of which were agreed to by management, including the consideration to terminate the contract with Orgaworld and considering other alternatives such as constructing a City-owned facility or a new contract with another supplier.
