Loading...
HomeMy WebLinkAbout2001-03-13 - AGENDA REPORTS - SOLID WASTE FRANCHISE (2)CITY OF SANTA CLARITA AGENDA REPORT UNFINISHED BUSINESS City Manager Item to be pre DATE: March 13, 2001 SUBJECT: SOLID WASTE FRANCHISE DEPARTMENT: Planning & Building Services RECOMMENDED ACTION Receive staff report, endments to reflect the direct staff to prepare detailed franchise mn negotiated deal with existing haulers and direct staff to prepare a competitive non- exclusive roll -off franchise. BACKGROUND— On March 5, 2001, the City Council heard testimony and discussed the Solid Waste Franchise. A motion was made and approved (3-1-1) to continue the item to March 13, 2001 to allow the Councilmembers additional time to consider the issues associated with this decision. In addition, the Council directed staff to prepare and deliver written notice of the termination of the automatic twelve (12) month extension provision of the current contract. Attached to this Agenda Report is the March 5, 2001 report for reference. ATTACHMENTS March 5, 2001 City Council Agenda Report JJL:Iep Lamberilenvsvcs/ccagda.3-13 01: TANK IN M V I I Agenda Item: X07. CITY OF SANTA CI.ARITA AGENDA REPORT UNFINISHED BUSINESS City Manar Item to be DATE: March 6, 2001 SUBJECT: SOLID WASTE FRANCHISE DEPARTMENT: Planning & Building Services RECOMMENDE A T_10N Receive staff report, direct staff to prepare detailed franchise amendments to reflect the negotiated deal with existing haulers as amended (based on verbal proposal by Waste Management on February 28, 2001) to exclude rolloff service, reduce the term to 10 Years (7 year fixed followed by 3 year evergreen, with biannual to prepare a competitive non-exclusive roll -off franchise reviews), and direct staff BACKC__ROL� This item was before the City Council at its February the Council heard public on testimony and moved to direct staff to me2001 et with AAt Allied/BFI�to seek directed tocof the proposal submitted to the City on February 13. Staff was more detailed information on the BFI/Allieda Obtain d February 13, 1 without negotiating the of the proposal from proposal. The Purpose of this agehda report is to provide the following to the Council: 1• Transmittal of the AlliedBFI proposal, as expanded in a meeting held with City staff on Friday, February 16, 2001 (this and all material provided to the City from Allied/BFI is attached to this report) 2• Evaluation of the Allied/BFI proposal; 3. List, of pros and cons for each of the two action alternatives recommendation section above; described in the 4. List of service enhancements agreed to through the negotiations with the existing franchisees (including recently Proposed changes). 6• Response to objections raised by roll -off service companies; and 6. A chronology of discussions, meetings, and correspondence re franchise issue. regarding the trash Agenda Item: Solid Waste Franchise Page 2 STAFF ANALYSIS &aivatzon offhe AllieoYBFI ar oaosal The following is staffs evaluation of the significant terms outlined in the Allied/BPI Proposal- This evaluation is based on information Presented to staff at the February 16, 2001 meeting and additional material submitted to staff subsequent to this meeting, • Residen_ tete . ,��FI has Proposed a residential rate that will not exceed $18.60 per month upon start of service at the end of the 6 -year notice period. After the 6 -Year period, Allied/BFI willuse standard CPI adjustments in order to determine rate increases. Allied/BFI has not committed nor proposed a mechanism to limit rate increases during the 20 -year term of the contract. The currently negotiated deal with the existing franchisees anticipates a maximum annual increase of 2% (after four additional years of a rate freeze). • Commercial - Al ied/BFI Proposes to set the commercial rate at the top of the emstmg commercial rate band for each level of service, thus eliminating the rate band. It is anticipated that commercial rates would increase by a maximum of 1% each year for five years until the current contract terminates. AlliedBFI has not offered crate -based program to encourage commercial recycling. They do, however, have a 2 -cent recycling fee with an extensive public outreach capability. They have Proposed to assign one full-time Public outreach staff person for the City of Santa Clarita service. The current negotiations with existing franchisees anticipates that all commercial customers pay rates within the rate band, encourage recycling with a reduced rate to Dianer- Allied/BFI Proposes to provide diaper recycling pick-up services for both residential and commercial (hospitals, day care centers, etc.) customers. The facility would be located at the Sunshine Canyon Landfill.However, Allied/BFI has not committed to fund the additional capitol start up coats nor the ongoing operational costs of the diaper recycling machine The currently negotiated deal with the existing franchisees assumes a si that they are willing to conmilar arrangement. All haulers have stated duct a pilot only. In either case, the City must reach a specific arrangement and define the three -party Partnership between the Gity, haulers and Knowaste before any funds are expended for the diaper recycling Program. Green Waste R2Mc1ing - AlliedBFI is facility at Sunshine Can currently Purs Canyon Landfill. Permits for a green waste Future Plana include an on-site compost area for green waste and food waste, which will allow them to expand their service to an organic recycling program rather than just green waste. MRF/Processine Cento. _ AlliedBFI is considering center at the Sunshine Canyon Landfill, It is anticip ated th g thrAF/ms site ould ng operating within four years The diaper processor would also be housed at the MRF be location at Sunshine Canyon Landfill, It was not clear as to whether the diaper Processor could be housed at the landfill delaying the implementation of a program uprior to the construction of a MRF (thus ntil the MRF was constructed). Solid Waste Franchise Page 3 • 11 -off - Allied/BFI proposed to include only Permanent rolloff service in the agreement. All temporary roll -off service would continue to be an open competitive market. Staff believes the City should include all roll -offs in the franchise in order to manage the waste stream properly. However, this can be done in an exclusive or non-exclusive arrangement. It is more important to the City that all of the waste generated be s captured in our reports, rather than the ply who specifically provides the service (see separate analysis of the roll -off service issue later in this report) • Landfill Capacity - Allied/BFI reports that they have 25 Years worth of landfill capacity at the Sunshine Canyon Landfill which is based on permits by Los Angeles County and Los Angeles City. A state permit to proceed with the expansion approval recently received from the City of Los Angeles has not yet been received, but is expected shortly. • Elsmere Dedication - Allied/BFI offered to donate 800 acres of their 1100 acre Elsmere Canyon holdings. The remaining 300 acres would be set aside for other Potential development purposes such as the expansion of the Cascades Golf Course. The donated land could be dedicated through an option agreement upon the City's action to give notice to the existing haulers or at the time a contract is signed with Allied/BFI to provide citywide waste hauler services. Allied/BFI has stated that they are confident in their ability to be the selected company through a bid process, regardless of the offer to include Elsmere. • Senior Citizen Discount - Allied/BFI proposed offering a senior citizen discounall t to citizens over 62 years of age. The senior citizen discount will be a is savings. Waste Management has agreed to amend the existing deal to discount at age 60. include a senior Clean Fue__ 1 V_ ehicl_s -Allied/BFI proposed that all refuse vehicles will be "clean fuel° vehicles (LNG). Because Allied/BFI would be purchasing all new vehicles to service a new contract with the City, all vehicles would be 'clean fuel" at the start of the contract. The existing gfranchiseess ha have also agreed, and all haulers are required by the Air QualityMan ( QMD) to conduct this conversion as new vehicles and/or replacement vehicles are purchase Violations at Sunshine Can on Landfill - During the period between October 1999 and October 2000, the LA County Department of Health (LEA total of 15 violations at Sunshine Canyon Landfill that ratraffic a nged at Sfrom trac control,unshine) issued a to above -limit concentrations of methane gas, to acceptance of untreated medical waste. As of January 4, all violations issued by the LEA were either fully corrected or downgraded to "area of concern" and there were no outstanding LEA violations. From May to September 2000, 17 loads of suspected untreated medical waste were taken to Sunshine and identified by site personnel. In a report to the LA County Board of Supervisors on medical waste issues, the Health Department found that BFVAllied acted diligently in carrying out its hazardous waste exclusion program. The suspected waste was identified (although it did not arrive properly tagged from the medical institutions), and was disposed in a distinct area apart from the normal trash discharge area. Thus, the Health Department believes that many of the suspected loads identified at the landfill were likely to have been properly autoclaved Solid Waste Franchise Page 4 s and cone oftlte trio idontiffo•+.,rf .zD „ service enhancements would be effective immediately (see list following) • No disruption of service to residents with continuation of current provider • Residential rate freeze continued for additional 4 years (total of 10 collection of waste stream data (upon inclusion of non- exclusive roll -off services after a competitive nrse amendment with F a Cone P • Potential for legal • challenge City will.be locked ■ into an evergreen term • Lost o anti to obtain Elsmere Canyon (800 acres) through a • Lost City franchise document to a+cnsc potential for I • SU ccessful legal challenge Of 800 acres of Elsmere Canyon (no certainty) — only if a deal is made with Allied/BFI • City designed state- of-the-art) franchise document with new bid • Potential to gain enhanced service and cost package for the community (exclusive franchise agreement) with new deal commencing in 5 a 'No increase in service enhancements for 5 years (does not mean that services will decline since current haulers are still required to comply with the current -r QAUCl3Llar rate increases commencing on January 1, 2002 (up to 5% per year) based on current franchise for the City to not achieve its 75% diversion goal by • 5 -years of pot the sally heavy lobbying by all viable haulers to get the ultimate contract Potential for remain amus Potential to alienate achieving goa75%l highest rates in the Granada hills diversion goal by Southern coin ivait 2005 due to the City Y agaurst e_1_ California. Solid Waste Franchise Page 5 AL""""'mac The term of the franchise will be modified to a four- ear Enhancement: rgreen for a total of 12 gears. Y fixed term with an eight- ------_. year eve Term of the The recent amendment mould reduce this term to l0 years (7 ear Contract followed by a 3 year to y fixed (Section 10 A), with a biannual inview) ontra t Proposed language would change this formula to a ua140% of the change Enhanc meat: Los Angeles-Anaheim_Riverside CPI with a cap in the '=dJuetment of established to determine if haulers rate increase request is reasonable. will City Rates Council will have the right to approve (Section 21B, the haulers based on these criteriaa lower rate increase than that Proposed by Eahih;r. -Ali e new subsection B is proposed to be added to Section 22 regarding SCAQMD E—went: Rule 1193. The proposed language would require indemnification of the City. AQMD Rule 1293 against any potential fines associated with SCA and other vehicles of the waste haulers. QMD 1193 as it relates to fleet Proposed Legislation A new subsection C is proposed to require haulers to comply with any and all (Section 22 B) legislation regarding environmental policy – including a requirement for the use of re -refined oil in fleet vehicles. Language will be added that indicates the City will partner with the haulers in developing a shared public alternative fuel fueling station. he haulers agreed to use re -refined oil as to hicles warrantee as does not conflict with the L::I= proposed new subsectionnguage would notallow• a n would be added toSection 6. The proposedside and outside the Ci Y single collection route to have addresses both ty'a franchisearea.e haulers already have a tracking system, but the City is requesting quarterly orts on route ehan es.Contra.,+_ Enhan a.. eat: j . -O ; •""a""C uPaates the franchise Superfimd liability language. Specific --�_. additions include liability from disposal facilities not owned a operated by the Superfund grantee. In addition to u Liability require an annual meeting updating SuPerfund language, the proposed would (Section 26B) reduce their respective p� �al CERCLA and other liabilities third tween the haulers and City Staff to cuss ways to I Parties. Solid waste Franchise Page B Enhancement CU.: Enhanced Insurance Liability Enh— anc-_ement: Comingled Recycling (Section 5 C1, ervice Enh--�ncement: Enhanced Green Waste Services (Section 5 Cl, -Enhancement- Rate nh ent:Rate Freeze (Exhibit D-01) Proposed language revises current franchise insurance language. workers compensation limit to $10 million a Increases and $5 million per occurrence and $20 million aggregate, l million auto insurance general liability. teased on the results citywide. Proposed language would enhance green waste services to include: landscaping and gardening services would be able to place their green waste material at the curb for collection as well. In addition, containerized wood/lumber would be included as an eligible material for collection (as long as it fits in the container and is accepted by the recycler). The requirement for 12 additional green waste collections would be eliminated. , 20 rates will remain D). frozen for an additional 4 years (ending December 31 D1, 2005)5) and will apply to all rates on Exhibit D-01 (with the exception of item ---r-�-� ..,,�,u uaa several sections to Subsection K of Section 5. Language Enhanc meat: includes the requirement for the following enhancements to public education: E!7every hEducational lids on recycling and green waste bins Quarterly presentations .to schools, and a twice -yearly report to the City egarding the effectiveness of the presentations (The haulers agreed to two per uarter per. hauler) ep�erl ort to the eientty tions 'to multi -family cessommunities and atwice-yearly evelopment o publiicceducationn m teririallss ftshepr s pts y for multi- amily communitiesotatingradio and television ads roduction y a half hourinformational video - make a new video at least ve 2 to 3 years Solid Waste Franchise Page 7 - rrvposes anew Subsection D2 to Section b. Proposed 1 ZR ancement: that all multi -family premises have re gum explicitly requires Multi Family faradot c cycling services Provided. That all multi - Recycling services by Preraises 2001. at do nThe Ciurrty have recycling service will have recycling (Section 5D2) recycling service is not Y grant exemptions to this in cases where practical. «imposes a new bubsection C2 to Section 5. Proposed language would specify Enhanc meat: that those single Residential Bin recycling Y using residential bin ld family service must also have ycling service. Service Recycling "�`•'�� Proposed language defines all t y E—�ncement: collection. Haulers will be required to ollrecyste as and recycle Expanded Types any types of material they are able to. ct all types of ofRecyclables (Section 2 J) The haulers are willing to add materials to the list of recyclables as long as items }} t in cans and are accepted b ]� .Y the recvnlor - me proposed language would add Subsection E --int: interested in determining an effective system Self Haul residents who wish to cancel their waste service, (Section 5 p) P of Section 5. The City is for proper waste disposal for Solid Waste Franchise Page 8 ontract Proposed language would require haulers to provide notification of changes to the Enhanc ent: collection schedule on billings statements immediately prior to all holidays. Notiftcatlon of Holiday Schedule (Section b G) .service The proposed language would add Subsection D2 to Section 5. Proposed language Enh— anc—_ ement: would define what is included in baggy service. Ba Baggy Service in Multi-familycommunities Lan Baggy service will only be offered (Section 6 D2) shall collect as many as two (2) 40 -gallon trash bags of ows. B��v Seruace. Grantee k. Grantee shall provide all residents with a single 34 -gallon bin solid for wthe disposalaste per ofre clable material. Service rates or ba service are des mated in Exhibit D-01 Cot�raet The term of the franchise will be modified to a four-year fixed term with an eight - Term year evergreen for a total of 12 years. Term of the Contract O= rvice Proposed program would ? { 'm'. ys rrs��.s Enhancement• require haulers to assist with a commercial waste audit -- Program. Haulers would assist in characterizations of the waste streams it Waste Audit individual businesses as a part of the sales process. The goal of the program is tOf o I'rob'r wn increase commercial diversion through educating local businesses on how source reduction and recycling can benefit the cost effectiveness and efficiency_ Solid waste Franchise Page 9 Items raised by the City Council at the February 13, 2001 meeting are highlighted above. Additional items raised were considered but deal: were not included in the negotiated "'Ile Uity attorney advised against have the franchisees provide free services to the City; however, the current franchise includes an annual additional $112,000 for ons cified services Hazardous Waste The haulers have offred eto contribute a portion of the $112,000 for this aar, , At the February 13, 2001 City Council meeting on this item, several roll -off company representatives expressed concern that including roll -off. service is the franchi Put them out of business. Staff had meetings with the following rell-off as would Crown Disposal, Looney Bins, A/V Equipment companies:Rental, and Rent -a -Bin. They have all expressed a desire to continue operation and opposition to as exclusive franchise for roll- off services. Waste Management has verbally offered to amend the currently negotiated deal to take roll -off services out of the deal and to reduce the term to a total of 10 years (7 year fixed followed by 3 years evergreen). Staffs recommendation is to accept this Offer and to pursue a competitive non -e_ xclusive roll -Off franchise • February 1999 - Allied purchased BFI • Summer 1999 — Staff contacted Allied to determine their interest in se Elsmere property to the City or some other public agency lling the • January 2000 - - Staff met with Allied and toured the Elsmere property and reached agreement that as soon as the current lawsuit pending against Allied/BFI over the City of Los Angeles expansion of the Sunshine Canyon Landfill, the City could Proceed with an appraisal of the Elsmere property. It was expected that the City would make an offer to purchase the property upon completion of the appraisal. • January 25, 2000 — City Council directs staff to investigate what will happen if the City puts franchise agreement out to re -bid rather than extending evergreen contract. • March 7, 2000 — City Council Study Session reviews report of findings on what would happen if the City goes out to bid. • March 14, 2000 — City Council Meeting, direction provided to stag to negotiate with existing franchisees to get as much through negotiations as could have been obtained through the competitive bid process • April 28, 2000 — Hauler negotiation session with City staff • May 11, 2000 — Hauler negotiation session with City staff • May 17, 2000 — Hauler negotiation session with City staff Solid Waste Franchise Page 10 • May 25, 2000 — Hauler negotiation session with City stag • June 8, 2000 — Hauler negotiation session with City staff • October 20, 2000 — Hauler negotiation session with City Staff • November 3, 2000 — Hauler negotiation session with City staff • November 14 — Hauler Update to the City Council • November 27, 2000 — Allied/BFI met with staff to discuss their concern with the City Potentially including roll -off services in the existing commercial franchise agreement. At this meeting, the stag encouraged BFI to submit a written proposal to the City. • November 28, 2000 — Hauler Update to the City Council, • December 15, 2000 — City staff and the City Council Solid Waste Committee received correspondence from Allied/BFI. This letter only advocated for the continued competitive roll -off market. No specific proposal was received. • December 19, 2000 — Hauler negotiation session with City staff • January 2, 2001— Diaper Recycling Study Session • January 22, 2001— Hauler negotiation session with City Staff • February 13, 2001 — City Council and City staff received a written proposal from Allied/BFI that included the donation of Elsmere (first time the donation of Elsmere was included in the proposal by BFI/Allied). • February 13, 2001— Hauler update to the City Council • February 15, 2001— Staff met with Looney Bins to discuss the roll -off service issue. • February 16, 2001 — City staff met with Alhed/BFI to obtain additional information regarding their February 13, 2001 proposal. • February 26, 2001— City staff met with several rolloff companies (Crown, A/V, and Looney Bins) • February 27, 2001— City staff met with Rent -a -bin representative • February 28, 2001 — City staff met with existing franchisees to discuss status of negotiated deal • March 1, 2001 — City staff releases agenda report for March 5, 2001 City Council meeting ALERN&W A ONS • Provide notice to the franchisees on the City's intent to re -bid the residential franchise at the conclusion of its term in five years • Other actions as determined by the City Council AT1'A--- CHMENTS Allied/BFI proposal dated Febru 6, 2001 and additional material submitted to the City subsequent to Feb , 2001 City notes from Fe 16, 2001 meeting with Alhed/BFI Corresponds om Allied/BFI to the City Corresp ence from Looney Bin to the City Dr otice of Intent to Bid Letter ap of the Elsmere Dedication Solid waste Franchise Page 11 JJL:Iep a: \pbs\lambert\eavarvice\ccagda3,5.doc