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HomeMy WebLinkAboutGREAT WESTERN RECLAMATION, INC.- A-92-152 & A-92-153 ORDINANCE NS-2179 - An ordinance of the City of Santa Ana authorizing the Downtown Development Manager to issue citations for violations of certain Municipal Code provisions and to issue notices of parking violations - Community Development Agency * * * END OF CONSENT CALENDAR * * * • BUSINESS SESSION AGREEMENTS 12.D. REFUSE COLLECTION, DISPOSAL AND RECYCLING Staff presentation by Public Works Agency Administrative Services Manager Teri Cable The following persons expressed support for the staff recommendation to award the City's refuse collection, disposal, and recycling contracts: Rick Reynolds, Macamco Communications and Electronics Fidel Gutierrez, 1818 W. Meriday Isabel Hernandez, 2028 S. Wood Street Nam Wheeler, 32457 Spy Glass, San Juan Capistrano The following persons encouraged open competitive bidding for the City's refuse collection, disposal, and recycling contracts: Nancy Arakelian, Intergrated Recycling Systems Madeline Arakelian, South Coast Refuse Dolores Otting, Five Star Rubbish Kathi Jo Brunning, 2414 N. Spruce Lyle Overby, 3700 S. Susan Thom Berning, 212 Capri Miles Leach, 2025 W. Tenth Street Nancy Black, 615 S. Euclid Original Motion: Direct staff to seek proposals on commercial and residential refuse collection, disposal and recycling as a citywide package and returnn the matter to Council J for award of the contract as soon as possible. MOTION: Richardson SECOND: Pulido After some discussion on the item, the following substitute motion was made: CITY COUNCIL MINUTES ` 374 DECEMBER 7, 1992 Ni Substitute Motion: Solicit bids for the City's refuse collection, disposal and recycling in such a manner as to allow for smaller companies to offer proposals on any and all portions of trash collection services. il MOTION: Norton SECOND: Moreno 11 'i VOTE: AYES: Moreno, Norton NOES: Lutz, Mills, Pulido, Richardson, Young ABSENT: None The substitute motion failed. Vote on original motion: VOTE: AYES: Lutz, Mills, Norton, Pulido, Richardson, Young NOES: Moreno ABSENT: None The Mayor requested the City Manager provide the Council with a one-page summary detailing the process the City will use to solicit competitive bids for trash collection. RECESSED - 7:58 P.M. RECONVENED - 8:35 P.M. - All Councilmembers present. 12.D. REFUSE COLLECTION - AMENDED VOTE Councilmember Moreno indicated he had misunderstood that the original motion would allow small companies to pool their efforts to submit a unitary bid for trash collection services and requested his vote be changed to the affirmative on Item 12.D. By the unanimous informal consent of the Council, Councilmember Moreno's revised vote was accepted and the vote on Item 12.D. was revised as follows: VOTE: AYES: Lutz, Mills, Moreno, Norton, Pulido, Richardson, Young NOES: None ABSENT: None CITY COUNCIL MINUTES 375 DECEMBER 7, 1992 i ,, REQUEST FOR PA COUNCIL ACTION EduCanon 1st CITY COUNCIL MEETING DATE December 7 , 1992 CLERK OF THE COUNCIL USE ONLY Approved TITLE AMENDMENT AND AGREEMENT WITHA�Recommended /See Minutes GREAT WESTERN RECLAMATION FOR I 1 Ordinance on 1st Reading I I Ord inance on 2nd Reading REFUSE COLLECTION, RECVer,TNa Implementing Resolution AND DIS,.•- : I I Set Public Hearing For ::::::::(S) • �CITY MANS EAga-ls� Kt -y,-/5,3RECOMMENDED ACTION 1. Direct the City Attorney to prepare and authorize the Mayor and Clerk of the Council to execute an amendment to the agreement with Great Western Reclamation to begin single family residential recycling effective January 1, 1993 . 2 . Direct the City Attorney to prepare and authorize the Mayor and Clerk of the Council to execute an agreement with Great Western Reclamation to provide refuse collection, disposal and recycling services to the City effective July 1, 1993 through June 30, 1998. DISCUSSION Two items are being presented for City Council approval - an amendment to the present agreement with Great Western Reclamation and a new agreement with Great Western Reclamation for trash collection, recycling and disposal. Amendment to Existing Agreement In 1989 the State legislature passed Assembly Bill (AB) 939 requiring each city and county in the state to develop a plan for reducing the amount of refuse disposed at landfills. The law mandates a reduction of 25% by 1995 and by 50% the year 2000. The City of Santa Ana adopted the required Source Reduction and Recycling Element (SRRE) in June 1992 . This plan includes the recycling programs required to meet the mandatory reductions. The single family residential recycling program is scheduled to begin in January 1993 . 141 1 C .383 Amendment and Agreement with Great Western Reclamation December 7, 1992 Page 2 Residents will be asked to separate only their newspaper and their yard waste to maximize recycling efforts. Refuse will be collected at the curbside and taken to a materials recovery facility (MRF) . Great Western has recently purchased a materials recovery facility which is located in Irvine. Refuse will be transported to that facility where it will be fully sorted. All recyclable materials will be removed and sold. All residual refuse will be taken to ;' County landfills. During these six months, one-third of the residential refuse will be recycled. This recycling process will be phased over an 18 month period at which time all Santa Ana curbside refuse will be processed. The present agreement does not include provisions for recycling. To do that an amendment to the current agreement with Great Western will be required. This amendment will be effective for six months, from January through June 1993 . No additional fee increases to the customer will be required in this fiscal year. New Agreement The City is presently in the final year of an agreement with Great Western Reclamation. Current provisions in the contract require the City to negotiate renewal terms with Great Western Reclamation. Staff from the City Attorney' s office and the Public Works Agency have met with Great Western as required. The City's objectives in these negotiations have been as follows: , 1. To meet the mandates of AB 939 which requires a 25% reduction by 1995 and a 50% reduction by 2000 in refuse disposed of at the landfills in accordance with the City' s Source Reduction and Recycling Element. 2 . To obtain quality service for the community. 3 . To obtain competitive rates for these services. The proposed agreement meets the objectives identified above. Staff is recommending a new five year agreement with Great Western to be effective from July 1993 through June 1998. 1 20 142 f _ • Amendment and Agreement with Great Western Reclamation December 7, 1992 Page 3 The key provisions of the agreement are as follows: GENERAL 1. Assembly Bill 939 compliance and indemnification. State law mandates that each city implement its SRRE by ' implementing the required source reduction, recycling,.., composting, and educational programs and to meet the _ specified reductions in refuse disposal. Fines up to • $10, 000 per day may be levied for non-compliance. 'Under the proposed agreement, Great Western has agreed to assume the responsibility for implementation of all the programs required to comply with AB 939 . In addition, Great Western will fully indemnify the City against any fines. 2. Maintenance of quality service. The service provided by Great Western Reclamation has been well received by the community. The agreement requires Great Western to maintain the quality of their service provided to the community. RESIDENTIAL CURBSIDE SERVICE 1. Implementation of recycling program at a materials recovery facility and implementation of composting program. State law requires recycling, composting and associated refuse reduction programs. Great Western Reclamation has agreed to provide recycling of all City refuse. The company has purchased a Materials Recovery Facility (MRF) which is located in Irvine. In addition, they are negotiating the purchase of another large site in Santa Ana to build a state-of-the-art MRF to process trash. The facility is estimated to employ from 150 to 200 personnel. The recycling program is scheduled to begin in January 1993 with one-third of all refuse being processed at the MRF. By July 1993 two-thirds of the residential refuse will be taken to the facility for processing. At that time the City's composting program will begin. All separated yard waste will be taken to a composting . facility for processing. 143 1 2D A Amendment and Agreement with Great Western Reclamation December 7, 1992 Page 4 2. Large item pick-up service at curbside for residential customers. Single family residences will be allowed two on-call curbside pick-ups per year at no cost. This will allow residents to eliminate large items stored on their property and will support the City' s ongoing efforts to clean up the neighborhoods. This service will replace the semiannual large item cleanup program presently held in various City parks. 3 . Competitive rates for single family residential customers. Single family residential rates will remain competitive with other cities. In July the monthly charge for residential service is estimated to be $12 .50, which is subject to county landfill increases. At that time two- thirds of the City's residential trash will be processed or composted. Exhibit 1 reflects the residential rates estimated for an 18 month timeframe. The residential rates were based on an estimated average tonnage of 89 pounds per family per week. Santa Ana' s tonnages are high in comparison with other cities due to the high densities found in the city. (As a comparison, Tustin's tonnages were recently calculated at an average of 64 pounds per family per week) . Tonnages translate directly into higher collection, disposal and recycling costs. In spite of the high tonnages, the rates will remain competitive with other cities. The City is presently having an independent audit performed to substantiate Santa Ana's tonnages. COMMERCIAL/APARTMENT BIN SERVICE 1. Implementation of recycling program at a materials recovery facility and implementation of composting program. The recycling program for commercial and apartment bin service is scheduled to begin July 1993 with one-third of all such refuse being processed at the MRF. Like residential, commercial/apartment refuse will be phased in over an 18 month timeframe. In July 1993 separated yard waste collected from commercial and apartment accounts will be taken to a separate composting facility for processing. 120 144 Amendment and. Agreement with Great Western Reclamation December 7, 1992 Page 5 2 . Franchise fee of 5% to be paid to the City. Presently part of the residential fee is utilized to support the refuse collection program. This agreement extends a similar fee (which is built into the rate) to commercial and apartment accounts. Effective July 1993 the City will receive 5% of gross revenues from commercial/apartment accounts. This will generate approximately $300,000 in new revenue for the City per year. 3 . 15-19% reduction in commercial bin rates on July 1, 1993 . Commercial rates paid by 4400 customers will be reduced effective July 1, 1993 by 15 - 19 percent, subject only to county landfill increases. Commercial rates are shown on Exhibit 2 during the recycling phase -in period. With this agreement, commercial customers (businesses) will save $1.27 million during the 1993-94 fiscal year. 4. No increase in apartment bin rates on July 1, 1993 . Apartment rates paid by 2000 customers will remain the same on July 1, 1993 and are subject only to county landfill increases. The last apartment rate increase was in July 1991. Apartment rates are shown on Exhibit 3 during the recycling phase-in period. Apartment rates were determined separately from commercial rates .due to the differences in .tonnages. During a sample test period apartments generated 14 percent more refuse than commercial generators. The City is presently having an independent audit performed to substantiate the differences in apartment versus commercial tonnages. CITY SERVICES 1. Collection of refuse on city arterials. To enhance the cleanliness of the City' s arterials, containers will be placed in the more heavily trafficked areas in the city. This refuse will be collected by Great Western once per week at no charge. 145 12P Amendment and Agreement with Great Western Reclamation December 7, 1992 Page 6 2 . City bin service provided free of charge. Presently city operations generate refuse at City parks and other City facilities which is paid for by the City. This agreement provides that all bins utilized by the City be collected, recycled and disposed of free of charge. This is estimated to reduce City expenditures (primarily in the City's general fund) by $138 000.. per year. • 3 . City roll-off service provided at a discount. The agreement reflects a reduction in the City' s cost for roll-off service. The City will be responsible for gate fees only. Collection and recycling costs will be borne by Great Western. This is estimated to reduce City expenditures by $50, 000 per year. Roll-off boxes for neighborhood cleanups will be provided by Great Western at a 30 percent discount. One of the alternatives considered by staff was to competitively bid the agreement. Competitive bidding is not recommended at this time for the following reasons: 1. The city is presently receiving quality service. 2 . The bidding period specified in the present agreement of six months is too short. The requirements of implementing an extensive recycling program utilizing a MRF and arranging a composting program complicates the bidding process. In addition, more time is needed for a company to secure enough equipment to begin operating an account this size. Other cities that have gone to competitive bid have required 12 to 18 months to complete the process. This new agreement will provide the City 12 months at the end of its term in which to bid the contract, if desired. 3 . The City needs to keep residential and commercial collection combined to effectively place responsibility for compliance with AB 939 with one refuse contractor. 4 . A large firm is required to handle an account of this size. There are only two or three companies in the area that may have the capacity to meet the requirements of this contract. 12D 146 Amendment and Agreement with Great Western Reclamation December 7, 1992 Page 7 5. The successful bidder will be required to have access to a materials recovery facility located in the area. There are presently only three such facilities in the county -- one in Stanton, one in Anaheim and the third which is owned and operated by Great Western in Irvine. Staff supports and recommends approval of a new five-year agreement with Great Western Reclamation. Great Western is an established employer located in Santa Ana with approximately 120 employees. ,A strong potential exists for implementation of a new MRF in the city which will add 150 to 200 personnel to the local economy. With the operation of such a facility, the potential also exists for the city to receive a "host fee" charged on trash processed at such a facility. Great Western Reclamation is part of Waste Management Inc. , a large international company which is well established in the refuse and recycling industry. In addition, Great Western is in a financial position to implement the recycling and composting programs required by the agreement and to indemnify the city should recycling efforts fall short. The proposed agreement will allow the City to continue quality refuse services, begin recycling and meet State mandates while maintaining competitive rates. FISCAL IMPACT The rate payable to Great Western Reclamation on January 1, 1993 will increase from $9. 71 to $10.50 per month for each curbside , unit. There will be no increase associated with this action to the customer in the present fiscal year. This agreement will provide for an increase in City revenues of approximately $300, 000 and a decrease in current City expenditures of approximately $188, 000 each year of the agreement. APPROVED AS TO FUNDS AND ACCOUNTS: In James aS saie",iJo �... '+d . a Executive Director Executive eirector Public Works Agency Finance & Janagement Services JGR/TLC/N46krg ' 14 7 1 20 (T> _ ..- RESIDENTIAL CURBSIDE SERVICE RATES AMENDMENT TO PRESENT AGREEMENT Effective 1/1/93 Payable to Great Western $10. 50 Administrative costs 1.41 Total $11. 91 NEW AGREEMENT Effective 7/1/93 Payable to Great Western $11.05 Estimated administrative costs 1. 45 Total $12'. 50 Effective 1/1/94 Payable to Great Western $11.55 Estimated administrative costs 1. 45 Total $13 .00 Effective 7/1/94 Payable to Great Western $12 . 05 Estimated administrative costs 1.50 Total $13 .55 NOTE: The rate effective January 1, 1993 will not increase the rate charged to the residential customer. EXHIBIT 1 12D '^ r�� r • COMMERCIAL RATES CURRENT MONTHLY RATE MONTHLY RATE MONTHLY RATE BIN MONTHLY ON 7/1/93 ON 1/1/94 ON 7/1/94 SIZE/FREQ RATES (1/3 RECYCLED) (2/3 RECYCLED) (ALL RECYCLED) * lYD lX 54 44 45 46 2YD • lX 80 65 67 69 2X 125 104 108 112 3X 164 136 142 148 4X 203 169 177 185 5X 239 200 210 220 6X 277 232 244 256 3YD lX 110 89 93 96 2X 159 133 139 145 3X 203 170 179 188 4X 247 208 220 232 5X 292 247 262 277 6X 332 280 298 316 4YD lX 141 117 121 125 2X 193 161 169 177 3X 245 206 218 230 4X 297 251 267 283 5X 348 295 315 335 6X 398 338 362 386 * Subject to cost of living adjustment All rates subject to passthrough of landfill increases BUSINESSES WILL SAVE $1.27 MILLION IN FY 1993-94 EXHIBIT 2 x 149 120 i_ . : . ._ . .... :. APARTMENT RATES CURRENT MONTHLY RATE MONTHLY RATE MONTHLY RATE BIN MONTHLY ON 7/1/93 ON 1/1/94 ON 7/1/94 SIZE/FREQ RATES (1/3 RECYCLED) (2/3 RECYCLED) (ALL RECYCLED) * 1YD 1X 54 54 55 56 2YD 1X 80 2X • 125 80 81 83 125 130 134 3X 164 4X 203 164 171 177 203 5X 239 239 252 262 252 6X 277 277 293 262 305 3YD 1X 110 159 113 116 2X 159 3X 203 203 215 224 264 224 4X 247 247 5X 292 292 264314 276 6X 332 332 358 329 376 4YD 1X 141 141 145 2X 193 193149 3X 245 204 212 4X 297 297 262 274 320 336 5X 348 348 6X 398 398 398 435 459 * Subject to cost of living adjustment All rates subject to passthrough of landfill increases EXHIBIT 3 12D 150