The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamas Waste’s managing director yesterday said he planned to meet the Minister of the Environment over the residential garbage collection contracts, after the Government cut back its business earlier this month.

Francisco de Cardenas declined to comment further, after Kenred Dorsett yesterday asserted that despite the BISX-listed company losing the Fort Charlotte contract, it was still the biggest provider in the Government’s outsourcing scheme.

Bahamas Waste recently published advertisements saying the Government had cut its residential garbage collection contracts by 37 per cent, just after it had invested over $500,000 in five new trucks, forcing it to lay-off 17 staff.

In response, Mr Dorsett said the Christie administration said that upon assuming office, it found the Government was being over-billed by almost 4,000 houses - something that had cost the Bahamian taxpayer $2 million since 2011.

“In 2011, the then-administration made the decision to outsource garbage collection within the inner city to three companies namely, Bahamas Waste, Impac and United Sanitation,” Mr Dorsett said in a statement.

“At that time the house count in those areas was 12,949, and the contracted companies were paid $5 per house. It was discovered since my taking office that the Government was still being billed based on the 12,949 house count when it should have been 8,476 houses based on updated data.

“This correction affected Bahamas Waste with a loss of 3,938 houses. At that time they were collecting in three areas, and have since been contracted for an additional five areas, which makes Bahamas Waste the holder of the largest number of routes outsourced by the Government for residential garbage collection.”

Mr Dorsett said the Government had also managed to lower the per house fee from $5 to $2.50, a 50 per cent reduction.

“The house count oversight was costing the Bahamian people approximately $2 million since 2011,” he added.

“The measures presently being initiated by the Department of Environmental Health Services as pertains garbage collections will save the people of this country approximately $500,000 a year.

“The garbage collection contracts are entered into by the contracted company and the Department of Environmental Health Services (DEHS). These are month-to-month contracts renewable at that frequency.

“All contracts are renewed based on performance and the discretion of the DEHS as per the contract. In December 2013, the DEHS did not renew the contract with Bahamas Waste to cover the collections in Fort Charlotte, and even with this adjustment Bahamas Waste still services more routes than any other provider.”

The residential garbage collection contracts, via the Government’s outsourcing, have been a key driver of Bahamas Waste’s financial performance over the last few years.

Any reduction of its business in this sector could hit its earnings, and is something Bahamian shareholders will need to keep an eye on.