Rio Grande City is currently in settlement talks with its former trash collection contractor, paving the way for an end to their nearly three-year-long court battle.
In the settlement, which is still being finalized, the city is expected to pay $325,000 to BFI Allied Waste Services, which sued the city after it was terminated in September 2015.
In their suit, Allied Waste claimed their termination was a breach of their contract. Grande Garbage, a local company the city hired after they terminated Allied Waste, was later added as a defendant in the lawsuit.
The result was a convoluted legal dispute.
During preliminary court proceedings, a judge granted Allied Waste’s motion for a temporary injunction that prevented the city from contracting any other company for trash collection.
The city, therefore, created its own sanitation department and began collecting trash with equipment it lease-purchased from the owner of Grande Garbage for $10.
“The commission was ready to move on and unanimously agreed to settle the case at this point,” said Mayor Joel Villarreal of the city’s decision to settle.
“We took multiple factors into consideration,” Villarreal said, such as the cost-benefit analysis, the implications of going to trial, the years of potential litigation, and other potential pitfalls. “As we discussed it in mediation with Allied Waste, at that point we all determined that it was time to move on.”
In September, Allied’s original contract with the city expired, bringing an end to the injunction order. Subsequently, the city contracted with Grande Garbage again to finish out the company’s five-year contract that was interrupted because of the lawsuit. While Grande resumed collecting solid waste, the city continued to do brush pick-up themselves.
When Grande’s contract is completed in two years, Villarreal said the city intends to resume their in-house services.
“The city was the solid waste service provider for multiple years, which has helped to fray the expenses associated with this lawsuit,” he said. “We’re allowing ourselves a two-year window — either two-year, three-year window — to adequately prepare for us to eventually become the solid waste service provider.”
The mayor noted that solid waste collection is a “revenue-producing endeavor” and looked forward to when the city would return to being the provider.
“We’re ready to move on and so are they,” he said of Allied Waste, “and I think we’ve reached an amicable decision at this point.
“We’re ready to move on and take care of the needs of the city as we move forward.”