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CC SR 20201201 I - Commercial Waste Haulers Extension RANCHO PALOS VERDES CITY COUNCIL MEETING DATE: 12/01/2020 AGENDA REPORT AGENDA HEADING: Consent Calendar AGENDA TITLE: Consideration and possible action to amend the agreements with authorized commercial solid waste collection and recycling companies and to designate waste haulers for calendar year 2021. RECOMMENDED COUNCIL ACTION: (1) Approve Amendment No. 2 amending the commercial solid waste collection company agreements with California Waste Services LLC; CalMet Services, Inc.; Consolidated Disposal Service, LLC DBA Republic Services; EDCO Disposal Corporation; Universal Waste Systems, Inc.; USA Waste of California, Inc., DBA Waste Management of Los Angeles; and West Coast Waste & Roll Off Service to extend services for one additional year until December 31, 2021; and, (2) Adopt Resolution No. 2020-___, A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES DESIGNATING THE HAULERS AUTHORIZED TO PROVIDE SOLID WASTE COLLECTION AND RECYCLING SERVICES FROM COMMERCIAL PREMISES, AND ROLL OFF SERVICES TO RESIDENTIAL AND COMMERCIAL PREMISES IN THE CITY OF RANCHO PALOS VERDES IN CALENDAR YEAR 2021 FISCAL IMPACT: None Amount Budgeted: N/A Additional Appropriation: N/A Account Number(s): N/A ORIGINATED BY: Lauren Ramezani, Senior Administrative Analyst REVIEWED BY: Ramzi Awwad, Deputy Director of Public Works APPROVED BY: Ara Mihranian, AICP, City Manager ATTACHED SUPPORTING DOCUMENTS: A. Draft Amendment No. 2 to Commercial Hauler Agreement (page A-1) B. Resolution 2020- ___, designating the authorized haulers for the 2021 calendar year (page B-1) C. Original Agreement and Amendment No. 1 with Commercial Haulers to (page A-1) 1 BACKGROUND AND DISCUSSION: The City currently has non-exclusive franchise agreements with seven solid waste collection and recycling companies (Haulers) that provide commercial trash and recycling collection and disposal services. These companies provide trash bins to business customers for on-going business activities and construction waste dumpsters to residential and commercial customers. The City does not set rates for these services, and customers are free to choose any of the authorized companies. As a result, the authorized companies compete over customers through rates and services. Amendment No. 2 to Extend the Hauler Agreements The current Non-Exclusive Franchise Agreements (Attachment C) with the Haulers is set to expire on December 31, 2020. The proposed amendment (Attachment A) extends the agreements with the City’s existing Haulers for one more year, or until December 31, 2021. Extending the agreements through this amendment, obligates each company to negotiate in good faith over the course of the next year to implement the significant data gathering and contract revisions needed for compliance with new State mandates. Most notable will be how and at what cost will the City’s Haulers implement programs in response to Senate Bill 1383 pertaining to the disposal of organic waste. The extension maintains all previous agreement terms, including the requirement to obtain a City business license, submit proof of general, pollution, and workers compensation insurance, and provide refuse disposal and recycling tonnage information on a quarterly basis. Approval of the amendment is a short-term solution until new comprehensive agreements are prepared by a solid waste consultant, reviewed by the City Attorney, presented to the City Council Solid Waste Subcommittee, and brought before the City Council for approval in 2021. Staff will also separately present the implications of new mandates on the City’s residential sector, which is currently serviced exclusively by EDCO Disposal Corporation, at a later date in 2021. Designating City Waste Haulers for Calendar Year 2021 The City Council is being asked to adopt the attached resolution (Attachment B) designating the authorized Haulers to provide solid waste collection and recycling services from commercial premises, and roll off services to residential and commercial premises in the City for the 2021 calendar year. Adopting the attached resolution would continue to designate the seven companies currently under City non-exclusive franchise contract as being the City’s authorized commercial waste hauling companies. The purpose of designating only contracted waste hauling companies as the sole source of commercial refuse service in the City is to: a) avoid overburdening the street network, which creates traffic and congestion problems, b) reduce potential damage to the pavement by having fewer competing trucks driving through the same 2 areas, and most importantly, c) create efficiency, improve communication, and facilitate monitoring of commercial haulers for compliance with the various State mandates. Currently, the City collects a franchise fee of five percent and a waste reduction fee (as per AB 939) of up-to five percent of gross receipts from solid waste management companies operating in the City. The City encourages the Haulers to recycle by providing a financial incentive in the form of a reduction in the AB939 fee; if they recycle construction and business waste and divert certain amounts of solid waste from landfills to recycling, waste-to-energy, and/or material recovery facilities. ADDITIONAL INFORMATION Existing Mandatory Commercial Recycling Requirements The State currently has several recycling mandates; including Mandatory Commercial Recycling (AB 341) and Mandatory Commercial Organics Recycling (AB 1826) that necessitate the City work closely with its Haulers, monitor their compliance, and submit that information to CalRecycle annually. New State Mandate on Organic Food Waste (SB 1383) A new state mandate for Short-Lived Climate Pollutants: Organic Waste Methane Emissions Reductions (SB 1383) aims at reducing methane production and encouraging organic food waste recycling. This mandate is widely considered to be one of the most significant recycling and waste reduction mandates in California in the last 30 years. This new law will be enforced starting January 1, 2022; and will have significant impacts and requirements for solid waste management companies and the City. The City will need to amend existing franchise agreements or develop new franchise agreement(s) to implement and maintain programs to comply with this new mandate’s complex regulatory requirements related to collection, processing, contamination monitoring, education, reporting, and other subjects. Staff is working closely with the City Attorney’s office to determine how to properly address all the requirements of this new mandate. The process of memorializing and implementing the required measures is expected to take up to one year. ALTERNATIVES: In addition to the Staff recommendation, the following alternative action s are available for the City Council’s consideration: 1. Identify different designated Haulers for calendar year 2021 and direct Staff to return with a revised resolution at the December 15, 2020 meeting. 2. Take other action as deemed appropriate by the City Council. 3 01203.0014/675231.2 AMENDMENT NO. 2 TO NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION OF SOLID WASTE HANDLING SERVICES BETWEEN THE CITY OF RANCHO PALOS VERDES AND ________________________________ THIS AMENDMENT NO. 2 TO THE NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION OF SOLID WASTE HANDLING SERVICES (“Amendment” or “Amendment No. 2”) by and between the CITY OF RANCHO PALOS VERDES (“CITY”) and ________________________, (“CONTRACTOR”) is effective as of the 1st day of January, 2020. RECITALS A. CITY and CONTRACTOR entered into that certain Non-Exclusive Franchise Agreement For Provision Of Solid Waste Handling Services dated April 1, 2016 (“Agreement”) whereby CITY granted CONTRACTOR a non-exclusive franchise to provide solid waste handling services to commercial premises, and on-call box and bin services to residential and commercial premises. B. On December 5, 2017, CITY and CONTRACTOR entered that “Amendment No. 1” to the Agreement to extend the term of CONTRACTOR’s services and to make other miscellaneous changes. C. Since the parties last amended the Agreement, Senate Bill 1383 (“SB 1383”) was enacted in 2017 and its administration undertaken by State CalRecycle. The bill establishes statewide targets to reduce the statewide disposal of organic waste by 50 percent by 2020 and 75 percent by 2025, and requires that not less than 20 percent of edible food that is currently disposed be recovered for human consumption by 2025. The SLCP Organic Waste Reductions regulations developed by CalRecycle to implement SB 1383 were adopted in 2020 and set forth a variety of programmatic and policy-related requirements for jurisdictions, generators, and other entities to support the statewide goals of SB 1383. D. The CITY and other jurisdictions throughout the State will need to amend existing franchise agreement(s) or develop new franchise agreement(s) to implement and maintain programs to comply with SB 1383’s comprehensive and complex regulatory requirements related to collection, processing, collection containers, contamination monitoring, education, reporting, and other issues. Updating the CITY’s waste hauling franchise agreements as necessary for compliance with SB 1383 will entail a significant amount of negotiation, data gathering from each waste hauler serving the CITY, and substantive contractual terms. It is expected that the process of memorializing and implementing measures needed for SB 1383 compliance will take a period of up-to one (1) year. Therefore, CITY and CONTRACTOR intend to extend the Agreement term in order to accommodate the process of implementing SB 1383 compliance. E. CITY and CONTRACTOR now desire to amend the Agreement to extend the term for one (1) year, or to December 31, 2021, and allow for negotiations to implement a SB 1383 compliance program. A-1 01203.0014/675231.2 TERMS 1. Recitals. The foregoing Recitals are accepted and incorporated herein by this reference. 2. Contract Changes. The Agreement is amended as provided herein. Deleted text is indicated in strikethrough and added text in bold italics. Section 2.3, Term & Extended Term, is hereby amended to read as follows: “Unless earlier terminated in accordance with Article XI of this Agreement, this Agreement shall continue in full force and effect from the Effective Date until December 31, 2020 2021. If contractor provides written notice to City of its willingness to extend the Agreement not later than six (6) calendar months prior to expiration of the term or any extended term of the Agreement, City may, in its sole and unfettered discretion, extend the term of this Agreement, under its then-existing terms and conditions, for a maximum of three (3) years one (1) year (or any shorter period of time, as may be determined by City). City may waive the six-month notice requirement in its sole discretion.” 3. Good Faith Negotiation. Between the effective date of this Amendment and up- to December 31, 2021, the parties agree to negotiate diligently and in good faith the terms for SB 1383 compliance and a revised or restated agreement for non-exclusive franchised, commercial solid waste handling services that will encompass SB 1383 compliance. The parties acknowledge the negotiation goal of having a revised or restated agreement for waste services in compliance with SB 1383 in effect no later than December 31, 2021. CONTRACTOR agrees to reasonably and in good faith cooperate with CITY and its contractors or consultants in providing non- proprietary and non-confidential data, information and records as needed to negotiate such revised or restated agreement and needed to implement SB 1383 compliance. Although each party is obligated to negotiate diligently and in good faith pursuant to the terms of this Amendment No. 2, neither party is under any obligation to approve or enter into a restated or amended franchise agreement, and all expenses incurred by such party during the term hereof are incurred at its sole risk and expense. This Amendment No. 2 does not waive any police powers or discretion of the CITY. During any negotiation period, CONTRACTOR’s reliance on any representations or promises by CITY or their staff or consultants, or individual Council members, is undertaken at CONTRACTOR’s sole risk and expense. 4. Continuing Effect of Agreement. Except as amended by this Amendment, all provisions of the Agreement shall remain unchanged and in full force and effect. From and after the date of this Amendment, whenever the term “Agreement” appears in the Agreement, it shall mean the Agreement, as amended by this Amendment to the Agreement. 5. Affirmation of Agreement; Warranty Re Absence of Defaults. CITY and CONTRACTOR each ratify and reaffirm each and every one of the respective rights and obligations arising under the Agreement. Each party represents and warrants to the other that there have been no written or oral modifications to the Agreement other than as provided herein. Each party represents and warrants to the other that the Agreement is currently an effective, valid, and binding obligation. A-2 01203.0014/675231.2 a. CONTRACTOR represents and warrants to CITY that, as of the date of this Amendment, CITY is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice, or both, would constitu te a material default under the Agreement. b. CITY represents and warrants to CONTRACTOR that, as of the date of this Amendment, CONTRACTOR is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice, or both, would constitute a material default under the Agreement. 6. Adequate Consideration. The parties hereto irrevocably stipulate and agree that they have each received adequate and independent consideration for the performance of the obligations they have undertaken pursuant to this Amendment. 7. Authority. The persons executing this Amendment on behalf of the parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Amendment on behalf of said party, (iii) by so executing this Amendment, such party is formally bound to the provisions hereof, and (iv) the entering into this Amendment does not violate any provision of any other agreement to which said party is bound. [SIGNATURES ON FOLLOWING PAGE] A-3 01203.0014/675231.2 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first-above written. CITY: CITY OF RANCHO PALOS VERDES, a municipal corporation ____________________________________ John Cruikshank, Mayor ATTEST: _________________________________ Emily Colborn, City Clerk APPROVED AS TO FORM: ALESHIRE & WYNDER, LLP _________________________________ William W. Wynder, City Attorney CONTRACTOR: NAME: By: ________________________________ Name: Title: By: ________________________________ Name: Title: Address: ____________________________ ______________________________ ______________________________ Two corporate officer signatures required when CONTRACTOR is a corporation, with one signature required from each of the following groups: 1) Chairman of the Board, President or any Vice President; and 2) Secretary, any Assistant Secretary, Chief Financial Officer or any Assistant Treasurer. CONTRACTOR’S SIGNATURES SHALL BE DULY NOTARIZED, AND APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS MAY BE REQUIRED BY THE BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR REGULATIONS APPLICABLE TO CONTRACTOR’S BUSINESS ENTITY. A-4 01203.0014/675231.2 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT STATE OF CALIFORNIA COUNTY OF LOS ANGELES On __________, 2020 before me, ________________, personally appeared ________________, proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature: _____________________________________ OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on t he document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT INDIVIDUAL CORPORATE OFFICER _______________________________ TITLE(S) PARTNER(S) LIMITED GENERAL ATTORNEY-IN-FACT TRUSTEE(S) GUARDIAN/CONSERVATOR OTHER_______________________________ ______________________________________ SIGNER IS REPRESENTING: (NAME OF PERSON(S) OR ENTITY(IES)) _____________________________________________ _____________________________________________ ___________________________________ TITLE OR TYPE OF DOCUMENT ___________________________________ NUMBER OF PAGES ___________________________________ DATE OF DOCUMENT ___________________________________ SIGNER(S) OTHER THAN NAMED ABOVE A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy or validity of that document. A-5 01203.0014/675231.2 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT STATE OF CALIFORNIA COUNTY OF LOS ANGELES On __________, 2020 before me, ________________, personally appeared ________________, proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature: _____________________________________ OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT INDIVIDUAL CORPORATE OFFICER _______________________________ TITLE(S) PARTNER(S) LIMITED GENERAL ATTORNEY-IN-FACT TRUSTEE(S) GUARDIAN/CONSERVATOR OTHER_______________________________ ______________________________________ SIGNER IS REPRESENTING: (NAME OF PERSON(S) OR ENTITY(IES)) _____________________________________________ _____________________________________________ ___________________________________ TITLE OR TYPE OF DOCUMENT ___________________________________ NUMBER OF PAGES ___________________________________ DATE OF DOCUMENT ___________________________________ SIGNER(S) OTHER THAN NAMED ABOVE A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy or validity of that document. A-6 RESOLUTION 2020- ___ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES DESIGNATING THE HAULERS AUTHORIZED TO PROVIDE SOLID WASTE COLLECTION AND RECYCLING SERVICES TO COMMERCIAL PREMISES, AND ROLL OFF SERVICES TO RESIDENTIAL AND COMMERCIAL PREMISES IN THE CITY OF RANCHO PALOS VERDES IN CALENDAR YEAR 2021 WHEREAS, the City of Rancho Palos Verdes (“City”) currently has commercial refuse collection agreements with the following seven (7) solid waste haulers to provide solid waste collection and recycling services to commercial premises and on -call roll off services to commercial and residential premises (“Commercial Haulers”): California Waste Services LLC; CalMet Services, Inc.; Consolidated Disposal Service, LLC; EDCO Disposal Corporation; Universal Waste Systems, Inc.; USA Waste of California, Inc ., dba Waste Management of Los Angeles; and West Coast Waste & Roll Off Service; and WHEREAS, pursuant to Section 8.20.260 of the City of Rancho Palos Verdes Municipal Code, and to improve monitoring and reporting of commercial and roll off disposal and recycling tonnage, and public education ac tivities, only parties to a collection agreement with the City may collect and dispose of solid waste in the City, with limited exceptions; and WHEREAS, the City Council has repeatedly found that opening commercial refuse services to non-contracted Commercial Haulers would overburden the streets and create traffic problems, as well as potentially damaging the pavement, and would increase the difficulty of efficiently monitoring and reporting commercial and roll off disposal and recycling tonnage, and public education activities; and WHEREAS, the City Council has considered the ongoing impact of Commercial Haulers on City streets, including their impact on traffic, as well as monitoring and reporting, and public education activities; and WHEREAS, the City Council has determined that it is still the case that having more Commercial Haulers than those under contract in accordance with Section 8.20.260 would overburden the streets and create traffic problems, as well as potentially damaging the pavement, and would increase the difficulty of efficiently monitoring and reporting commercial and roll off disposal and recycling tonnage, and public education activities; and WHEREAS, the presently proposed Commercial Haulers provided timely quarterly reports and fees, and provided the required proof of valid general liability and worker s compensation insurance during calendar year 2020; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES THAT: 1. The following seven solid waste haulers who are currently under contract with B-1 P:\7 City Council\Draft Staff Report Review 20201201\4. Final\I. CLERK COMPLETE - Commercial Waste Haulers Contract Extension\Attachment B- Commercial Waste Haulers Resolution 2020.docx the City pursuant to commercial collection agreements in accordance with Rancho Palos Verdes Municipal Code Section 8.20.260, and provided required quarterly reports and insurance documentation are permitted to continue such agreements and services thereunder in calendar year 2021: California Waste Services LLC; CalMet Services, Inc.; Consolidated Disposal Service, LLC; EDCO Disposal Corporation; Universal Waste Systems, Inc.; USA Waste of California, Inc., dba Waste Management of Los Angeles; and West Coast Waste & Roll Off Service. A contract amendment extending refuse hauling services with these Commercial Haulers over the calendar year 2021 is hereby authorized for execution by the Mayor in a form approved by the City Attorneys’ office. 2. No other solid waste haulers will be authorize d to collect solid waste and recyclables from commercial premises, or provide roll off services to commercial and residential premises in the City in calendar year 2021, except as provided in the City’s Municipal Code Chapter 8.20 and any contract executed between the City and any Commercial Hauler. PASSED, APPROVED, AND ADOPTED THE 1st DAY OF DECEMBER 2020. __________________________ ATTEST: MAYOR ___________________ CITY CLERK State of California ) County of Los Angeles ) ss City of Rancho Palos Verdes ) I, EMILY COLBORN, City Clerk of The City of Rancho Palos Verdes, hereby certify that the above Resolution No. 2020- ___ was duly and regularly passed and adopted by the said City Council at a regular meeting thereof held on December 1, 2020. ____________________________ CITY CLERK B-2 C-1 C-2 C-3 C-4 C-5 C-6 C-7 C-8 C-9 C-10 C-11 C-12 C-13 C-14 C-15 C-16 C-17 C-18 C-19 C-20 C-21 C-22 C-23 C-24 C-25 C-26 C-27 C-28 C-29 C-30 C-31 C-32 C-33 C-34 C-35 C-36 C-37 C-38 C-39 C-40 C-41 C-42 C-43 C-44 C-45 C-46 C-47 C-48 C-49 C-50 C-51 C-52 C-53 C-54 C-55 C-56