Ottawa residents will soon be able to put plastic bags and dog poop in their green bins if council approves a new contract with Orgaworld that also settles outstanding legal disputes and long-standing tensions with the waste-management company.

The new contract, which will go to the city's environment and climate protection committee Monday and to council the following Wednesday, will allow plastic bags and dog waste in the bin at a much lower cost than the contract initially laid out.

The city currently pays approximately $110 a tonne for Orgaworld to take the green bin waste, which doesn't include plastic bags. Adding plastic bags would have driven up the cost to $151 per tonne, but under the revised deal it will cost the city $124 per tonne.

When the changes take effect in mid-2019, it will cost the city an additional $626,000 a year — or an estimated additional $0.15 per month for the average taxpayer.

Getting rid of 'ick factor'

Coun. David Chernushenko, chair of the committee, said the renegotiated contract finally addresses some of the long-standing issues the city has had with the program, especially the inability to use plastic bags, which he believes was preventing people from adopting it.

"We heard over and over from some residents that this was an impediment, an ick factor that was keeping them from doing it," he said.

The city has struggled to get people to use the green bin with only an estimated 52 per cent of households using it today. That level of participation is resulting in a 40 per cent diversion rate of organic waste from the landfill, but a report on the new contract estimates the changes could increase diversion of organic waste to 64 per cent by 2023.

The city is also getting a break from a controversial provision in the contract that forced the city to pay Orgaworld to process 80,000 tonnes of waste a year, even though the city hasn't yet produced that much waste.

The new minimum will be 75,000 tonnes, which is much closer to the city's actual usage. The city estimates that change will save $360,000 this year and $2.7 million before 2022.

The city is keeping the length of the contract the same — set to end in 2030.

$4M for odour management

The original contract was heavily criticized by the city's auditor general, who found in 2014 that it had wasted $4.7 million of taxpayer money.

But Chernushenko said the new deal addresses all the concerns raised by the auditor.

He believes the renegotiation was possible because of new people around the table, new ownership at Orgaworld, and both parties wanting a better deal.

The company has also agreed to make investments in the processing plant, including $4 million for odour mitigation.