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HomeMy WebLinkAbout2005-11-08 - AGENDA REPORTS - ROLL OFF BIN FRANCHISE (2)Agenda Item: CITY OF SANTA CLARITA AGENDA REPORT UNFINISHED BUSINESS City Manager Approval: Item to be presented by: DATE: November 8, 2005 SUBJECT: PROPOSALS FOR THE ROLL -OFF BIN AND TEMPORARY BOX FRANCHISE DEPARTMENT: City Manager's Office 1.) City Council award exclusive franchises to the solid waste enterprises recommended by Staff. 2.) Authorize the City Manager or designee to execute all documents, subject to City Attorney approval. BACKGROUND Pursuant to the California Integrated Waste Management Act of 1989 (AB 939), the City of Santa Clarita is required to divert 50 percent of the waste attributed to sources within the City. If it fails to do so, the City could be fined up to $10,000 per day for non-compliance. Currently, the City is not in compliance with the 50 percent diversion requirement. The most recent (2003) diversion rate was 40 percent. The City was approved for an additional time extension, until the end of 2005, to achieve a diversion rate of 50 percent. As part of its AB 939 compliance efforts, the City is implementing new and innovative programs to reach the 50 percent diversion goal. One of the programs is a franchise system for temporary bin and roll -off box providers. The purpose of the franchise is to complement the C&D ordinance requiring the temporary bin and roll -off bin providers to divert a minimum percentage (50 percent) of solid waste. Staff proposed the franchise based on the year 2000 study of the City's waste generation activities. This study shows 25 percent of all waste going to landfills, from sources within the City, comes from non -franchised hauling activities. Although the majority of that waste comes FFROVE� from roll -off bins located at construction and demolition projects, the C&D ordinance addresses only a portion of the waste stream. More than 100 large businesses located throughout the City subscribe to roll -off box solid waste services, and several small construction and renovation projects fall under the threshold of the C&D ordinance. At the August 23, 2005, City Council meeting, Council directed staff to send out a Request for Proposals (RFP) to award Temporary Box and Roll -off Bin Franchises. The notice inviting proposals was advertised in the national trade publication Waste News and on the City's Web site. In addition, 24 proposals were sent via certified mail on August 31, 2005, to solid waste enterprises that are currently doing business in the City followed by phone calls on September 14, 2005, to each company to remind them about the proposals. Following the mandatory Pre -Proposal Conference on September 21, 2005 (at which there were 16 companies), two concerns arose that required additional attention from City Staff. City Staff extended the October 19 deadline for submitting a $20,000 bond. In addition, City Staff removed the requirement to submit maximum rates. The above mentioned changes to the RFP were implemented to make the Franchise accessible to more haulers. A total of 11 proposals were received by the City by the posted deadline. Five privately owned companies (Crown Disposal, A-V Equipment Rental, Rent -A -Bin, Residential Rent -A -Bin, and Burrtec Waste Industries) took exception to the requirement to submit financial information. Staff did not consider this an exception because they offered to provide this sensitive information at their business site or provided ample reasons to keep their finances confidential. The criteria required in the RFP consists of the following: • Ability to achieve 50 percent diversion; • Agree to submit monthly activity updates showing the amount of waste that was diverted, and how much was landfilled; • Agree to have all containers labeled with company name, phone number, identifier, and must be clear of graffiti; • Minimum insurance requirement of $2 million aggregate and $1 million per occurrence; • Agree to pay a franchise fee of 5 percent of gross revenue. Based on staffs review, and compliance with the requirements listed above, it is recommended that the City Council award the following ten solid waste enterprises exclusive franchises as proposed by staff without exceptions to the agreement. • Blue Barrel Disposal /Waste Management • Consolidated Disposal Service • BFI Waste Systems of North America, Inc. • Looney Bins Inc. • A-V Equipment Rentals Inc. • Rent A Bin • Residential Rent A Bin • Burrtec Waste Industries • All City Rent A Bin • Crown Disposal Co. Inc. The three remaining haulers submitted proposals, but did not meet the requirements set forth in the Request for Proposals (RFP). Therefore, staff can not recommend awarding them franchises. The following is a list of the haulers, plus the reason they did not meet the minimum requirements. Polo's Trucking is the only hauler who did not receive a call and certified mail from the City. Cordova's Construction located in Pacoima - Submitted proposal after posted deadline. J & M Containers located in Tarzana - Submitted the proposal after posted deadline. Polo's Trucking located in Pacoima - Did not attend the mandatory pre -proposal conference. After staff gave them an opportunity to submit additional information, they failed to meet the deadline as requested by staff. The proposal did not address how, their company would protect the City against litigation regarding CERCLA. Additionally, no references were listed and their Representations and Certification Form was not notarized. Once staff has received direction from Council, franchise agreements will be executed with each approved hauler. The agreements will be in effect starting January 1, 2006 and expire December 31, 2010. ALTERNATIVE ACTIONS Other action as determined by the City Council FISCAL IMPACT The fiscal impact is unknown at this time and is dependent on each company's performance. Each company will pay a franchise fee to the City based on five percent of their gross revenues. The fee will offset the cost of the franchise to the City, which includes administrative staff time, cost of maintaining the vehicle that will be utilized for inspecting sites, auditing the franchises, record keeping with respect to AB 939 compliance, and repair to local roads caused by the excessive wear and tear created by the large collection vehicles. The recommended franchise fee is lower than the average franchise fee required by the other cities that staff identified in their research (11 percent) and is less than the City's other two existing solid waste franchise fees of 10 percent.