Resource management

Helping providers and consumers of waste management services improve profitability and conserve resources.

Resource management contracts can help your organization cut costs, use resources more efficiently, and improve your economic health, as well as benefit the environment and our communities. With a simple, innovative twist, resource management—unlike traditional waste disposal contracts—places the value of the contract on resource conservation services rather than on disposal volume.

Based on the results of Minnesota's "first-generation" RM demonstration projects, the MPCA has developed new template language for RFPs and contracts. Do not use these templates as-is. You should customize the document for your own organization, and to ensure that your final document satisfies their institution's contract rules and review of internal counsel.

What is a resource management contract?

Resource management (RM) is a contract between a waste contractor and a waste generator that places the economic value of the contract on service rather than on volume. Traditional contracts compensate the contractor based on the volume of waste hauled and disposed of. The contractor is naturally driven to haul more and dispose of more waste to make more money, while the customer seeks to use resources more efficiently, thereby reducing waste output and waste disposal costs. With both the customer’s and the contractor’s goals at odds, a constant tug-of-war ensues and progress toward resource conservation is slowed.

Resource management contracts align the financial and services goals of both parties in a workable, economically driven contractual partnership, which will reduce waste and increase recycling, while decreasing the amount of waste disposed of. Such a partnership results in a win-win-win situation for the customer, contractor, and resource conservation.

Benefits

Advancing resource management contracting in Minnesota fits with the state’s desire to find innovative, market-driven approaches to solve problems and build strong partnerships.

  • For customers with limited time and money, RM contracts offer a way to bring in waste management experts to help them get a handle on current costs and waste production, by taking a look at their entire materials management supply chain. With baseline knowledge in hand, the customer and contractor can work together to take advantage of resource efficiencies, track their results, and share in any documented cost savings.
  • For contractors, RM contracts offer a potentially lucrative and easily replicable opportunity to diversify their business and form long-term partnerships for sustainable business growth, rather than limiting their opportunity for revenue potential to hauling and disposal.
  • For Minnesota, RM contracts offer a tangible, cost-effective way to improve Minnesota’s environment and economy by making the most of our resources.

Key features of a resource management contract

  • Strategic benefit-based partnership
  • Aligned goals, services, and incentives
  • Incentive-based compensation and shared financial reward
  • Increased waste minimization and prevention
  • Stabilized or reduced waste disposal costs
  • Internal and external materials management services
  • Clear and understandable cost accounting and billing
  • Data-based management and goal setting
  • Continuous cost and efficiency improvement
  • Co-leveraged expertise

First-generation RM contracts in Minnesota

Macalaster College

Mahtomedi School District

Independent School District 196

Resources

Resource Management manualResource Management: Innovative Solid Waste Contracting Methods, developed by the U.S. Environmental Protection Agency’s (EPA) Waste Wise Program and authored by Tom Votta, Deputy Director, Chemical Strategies Partnership, California Environmental Associates.

HTML icon Resource Management (U.S. EPA)

Case studies

Information and assistance

Madalyn Cioci, MPCA: e-mail Madalyn.Cioci@state.mn.us or call 651-757-2276, 800-657-3864 toll free