Contract Award for the Treatment and Disposal of Kerbside Collected Co-mingled Food and Garden Waste
North Lanarkshire Council · 24 August 2022
Back to Environment and Place Committee — 24 August 2022 and its agenda
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North Lanarkshire Council Report Environment and Place Committee Does this report require to be approved? ☒ Yes ☐ No Ref: NLC-CPT-22-037 Date: 24 August 2022 Contract Award for the Treatment & Disposal of Kerbside Collected Co-mingled Food & Garden Waste From Head of Regulatory Services and Waste Solutions E-mail mcphersona@northlan.gov.uk Telephone 07939 280467 Executive Summary The Committee is asked to approve the award of a contract for the provision of Treatment & Disposal of Kerbside Collected Co-mingled Food & Garden Waste (the ‘Contract’) to Levenseat Limited. The Contract is for an initial period of 36 months anticipated to commence on 01 October 2022. The Council reserves the right to extend the Contract for additional periods up to a maximum of a further 24 months in two 12-month periods. The value of the Contract shall not exceed Eight Million, Five Hundred and Fifty Thousand Pounds Sterling (£8,550,000.00) exclusive of VAT. Recommendations It is recommended that Committee approves the award of the Contract to Levenseat Limited at the maximum value of Eight Million, Five Hundred and Fifty Thousand Pounds Sterling (£8,550,000.00) exclusive of VAT. This recommendation follows the completion of a “Direct Award” procurement procedure using the Scotland Excel Organic Waste framework agreement (0220), Lot 3 - Co-mingled Food and Garden Waste (the “Framework”). The Plan for North Lanarkshire Priority Enhance participation, capacity, and empowerment across our communities Ambition Statement (17) Ensure we keep our environment clean, safe, and attractive
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1. Background 1.1 The requirements within the Contract are currently under contract with Levenseat Limited. This contract is due to expire on 30 September 2022 with the Contract detailed within this report due to supersede this. 1.2 North Lanarkshire Council are responsible for providing the necessary facilities to collect, receive, sort, treat, recycle and dispose of co-mingled food & garden waste collected via the Council’s kerbside recycling collection service. 1.3 The Kerbside collected co-mingled food and garden recycling collection service is one of several services offered and operated by the Council’s Waste Solutions team and compliments the weekly domestic kerbside collection services and Household Waste Recycling Centres, (HWRC), that are strategically located throughout the North Lanarkshire area. 1.4 It is anticipated that circa 24,000 tonnes of Kerbside co-mingled food and garden waste will be collected annually via the Council’s kerbside recycling collection service. 2. Report 2.1 A user intelligence group (the ‘UIG’) of technical and procurement representatives was formed to review technical specifications, discuss trading processes, market conditions and trends, ways to maximise community benefits and sustainability and to agree the procurement strategy that would deliver maximum benefit for the Council via the Contract. 2.2 The initial estimated value of the Contract and the identified procurement procedure dictated that the procurement procedure be undertaken in accordance with the Procurement (Scotland) Regulations 2016. 2.3 The procurement procedure was undertaken as a “Direct Award” from the Framework. The Framework has seven (7) contractors appointed however only three (3) were located within reasonable proximity of the Council’s proximity to accept the Council’s waste. Additionally, following a review of the three (3) contractors operating procedures, two (2) out of these contractors do not operate during the Council’s required operational timeframe therefore leaving only one (1) contractor to progress with from the Framework . 2.4 The Contract award recommendation is made on the basis of Levenseat Limited being the only eligible contractor capable of meeting the Council’s requirements, procedures, operational timeframes etc. Additionally, the Council will achieve continuity of service provision, with no impact or disruption to wider service delivery. 2.5 Negotiations took place with Levenseat Limited and a gate fee price was agreed which is a lower rate in comparison to the other contractors within the geographical area from the Framework. 2.6 Further details of the procurement procedure are provided in Appendix 1 and the SME status and location of the tenderer is located within Appendix 2.
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2.7 The value of the Contract shall not exceed Eight Million, Five Hundred and Fifty Thousand Pounds Sterling (£8,550,000.00) exclusive of VAT including all extension options available. 2.8 The costs associated with contract delivery will be contained within the revenue budgets for Waste Solutions. Price Savings / Increases 2.9 The new negotiated rate is an increase of circa 12.25% against existing contract rates. This increase can be attributed to market volatility, staffing costs, operating costs (i.e. fuel, electricity etc.) and inflation. However, by negotiating directly with Levenseat Limited, the Council was able to agree a circa 22.80% cost avoidance saving against Levenseat Limited’s agreed Framework rates. Price Stability 2.10 Prices submitted by Levenseat Limited shall be firm for the entire duration of the Contract, including any optional extension years. Community Benefits 2.11.1 The Council is committed to maximising the delivery of community benefits. The procurement included a community benefit requirement as per the terms of the Framework. This approach is designed to deliver local community benefits where possible. 2.11.2 Within their Tender, Levenseat Limited committed to deliver the following community benefits within the Contract: • Create foundation, modern or graduate apprenticeship opportunities; and • Local sponsorship to support a community initiative enhancing the local environment and developing sustainability. 2.11.3 The community benefits delivered as part of the Contract potentially include the creation of jobs or apprenticeships. Fair Work First 2.12 Within their tender submission for appointment to the Framework, Levenseat Limited confirmed that they pay their employees a minimum of the Living Wage and are also an accredited Living Wage Employer. Contract Strategy 2.11 Officers from Regulatory Services and Waste Solutions will be responsible for managing the Contract which will be undertaken in accordance with the Council’s agreed approach to contract and supplier management. 3. Measures of success The Contract will deliver the following outcomes;
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3.1 The appointment of a Contractor who can meet the Council’s requirements and has the experience of delivering, high quality and responsive food and garden waste disposal and recycling service that will deliver the minimum delivery targets within this Contract. 3.2 The contract award procedure is compliant with the procurement legislation, Scotland Excel Framework Terms & Conditions and internal procedures. 3.3 That Best Value is both demonstrable and achieved via a significant cost avoidance saving. 3.4 That the Contract secures community benefits. 3.5 A collaborative approach to the procurement of the requirement, minimising the burden on internal resource and leveraging the economies of scale. 4. Supporting documents Appendix 1 Summary of Procurement Process Appendix 2 SME Status and Location of All Tenderers Andrew McPherson Head of Head of Regulatory Services and Waste Solutions
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5. Impacts ( http://connect/report-template-guidance ) 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? N/A If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality-and-fairer- scotland-duty-impact-assessments Yes ☐ No ☐ 5.2 Financial Impact Does the report contain any financial impacts? Yes ☒ No ☐ If Yes, have all relevant financial impacts have been discussed and agreed with Financial Solutions? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? The new negotiated rate is an increase of circa 12.25% against existing contract rates. This increase can be attributed to market volatility, staffing costs, operating costs (i.e. fuel, electricity etc.) and inflation. However, by negotiating directly with Levenseat Limited, the Council was able to agree a circa 22.80% cost avoidance saving against Levenseat Limited’s agreed Framework rates. This has been built into the revenue budget for Waste. 5.3 HR Policy Impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts have been discussed and agreed with People and Organisational Development? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? N/A 5.4 Legal Impact
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Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☐ No ☒ If Yes, have all relevant legal impacts have been discussed and agreed with Legal and Democratic Solutions? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? N/A 5.5 Data Protection Impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐ If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e-mailed to dataprotection@northlan.gov.uk Yes ☐ No ☐ 5.6 Technology / Digital Impact Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? N/A Where the impact identifies a requirement for technology, has an assessment been carried out (or scheduled) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☐ 5.7 Environmental / Carbon Impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☒ No ☐
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If Yes, please provide a brief summary of the impact? The primary objectives of the Levenseat recycling process is to maximise recovery of recyclable materials from the Food & Garden waste at their organic processing plant. All material is reused/recycled, the organic waste for In Vessel Composting, non- organic waste is sent for further processing on site. The In Vessel Composting produces two products: • Energy rich extract which is transferred to a holding tank prior to be exported off-site via articulated trucks to be used in AD plants in England & Scotland producing both gas to grid and electricity to grid outputs. Residues from these processes include a nutrient rich sludge which can be used as fertiliser replacements in agriculture • The second product from the extrusion press is a moist but fibrous organic fraction which is presented for inclusion in the Levenseat IVC process. Following the process the mature composted material is used in agriculture and horticulture. 5.8 Communications Impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? N/A 5.9 Risk Impact Is there a risk impact? Yes ☒ No ☐ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed? Low risk as there are plenty of contingency opportunities if the contractor was unable to fulfil the contract in the event of an emergency.
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Appendix 1 – Summary of Procurement Process Response Procurement Procedure Utilised: Direct Award Governing Legislation / Regulations: Procurement (Scotland) Regulations 2016 Date Contract Strategy Approved: 01 July 2022 Number of Companies Invited to Take Part: 1 Tender Return Deadline: 13 July 2022 Number of Tenders Received: 1 Where Only One Tender Is Received, Why?: Direct Award Procurement Procedure Tenders Received from SME’s: 1 Tenders Received from NLC Based Tenderers: 0 Number of Recommended Tenderers: 1 Evaluation Team: Members of Regulatory Services and Waste Solutions Anticipated Contract Start Date: 01 October 2022 Total Contract Period (Months): 36 + 12 + 12 Maximum Total Contract Value: £8,550,000.00
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Appendix 2 – SME Status and location of all Tenderers Name of Tenderer Size of Tendering Organisation (Micro, Small, Medium or Large) Location (Local Authority / Council Area) Levenseat Limited Medium South Lanarkshire