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HomeMy WebLinkAboutAGENDA REPORT 1992 0701 CC REG ITEM 11Bt ITEM F MOORPARK 00 TO: FROM: DATE: 799 Moorpark Avenue Moorpark, California 93021 (805) 529-6864 M E M O R A N D U M The Honorable City Council Jill H. Rubin, Management Analyst June 25, 1992 (7\1 Meeting) SUBJECT: Commercial Overview SUMMARY ,,DRPAax, CALIFORN!A Solid Waste Franchise Agreement - At the May 20, 1992 City Council meeting, Anderson Rubbish requested that Council consider establishing exclusive franchise agreements for commercial solid waste collection. Council then directed staff to present an overview of the issues pertaining to Moorpark's non-exclusive commercial solid waste franchise agreement. Council is asked to discuss the issues and direct staff as deemed appropriate. BACKGROUND In July 1991, the City Council decided to award non-exclusive franchises for commercial solid waste collection, as was done the previous year for residential service, because of the AB 939 mandates and the need to monitor refuse generated by all sectors of the community. After conducting a competitive bid process, Council awarded four (4) refuse haulers - Anderson Rubbish, G.I. Rubbish, E.J. Harrison and Sons, and Rubbish Control - a three (3) year non- exclusive commercial solid waste franchise to provide refuse collection service to commercial (including apartment and condominium complexes) and industrial customers. A franchise fee (payable quarterly) of 10 percent of the gross revenues is collected from the four haulers. The haulers are also required to maintain statistics and provide information relative to AB939 requirements on City -designed forms. Currently Anderson Rubbish and G.I. Rubbish provide the majority of commercial hauling services in Moorpark, with E.J. Harrison and Sons servicing three (3) accounts, and Rubbish Control providing only "temporary" service for one account. PAUL W. LAWRASON JR. JOHN E. WOZNIAK SCOTT MONTGOMERY BERNARDO M. PEREZ ROY E. TALLEY JR. Mayor Mayor Pro Tem Councilmember Councilmember Councilmember Printed On Recycled Paper Honorable City Council Commercial Solid Waste Franchise Review July 1, 1992 Page 2 Unlike the residential haulers under exclusive franchise, all commercial haulers operate city-wide without a zone system, in order to ensure competition. Because of the non-exclusive nature of the agreement, a prospective commercial account can contract for services with any of the four franchised haulers, or discontinue service with one hauler and contract with one of the three remaining haulers. The non-exclusive franchise system provides a level of competition that allowing businesses to contract with the most cost effective service provider, at the same time assuring quality service. To assure that Moorpark businesses are not charged unreasonably high rates, Council established a maximum rate to be charged by the haulers for commercial collection service, effective for the term of the agreement. The haulers are not prohibited from negotiating lower rates with customers, and in essence set their own rates for service. Commercial Operations in Other Areas The City of Simi Valley is in the process of negotiating commercial franchise agreements with Anderson Rubbish and G.I Rubbish. The City previously regulated commercial hauling through a permit system; a maximum of 15 permits issued at no charge to haulers. Haulers were required to have a current business license, but no franchise fees were collected. The City plans to assign geographic areas (decided among the haulers) in an effort to increase collection efficiency - by eliminating duplication of routes by multiple haulers, reducing wear and tear on the roads, and reducing vehicle emissions. The City plans to impose a franchise fee of 5%, based on annual gross receipts. Since the rates charged by both haulers are consistent, the City does not plan to set rates. The City of Thousand Oaks has had an exclusive commercial haulers franchise agreement in place for twenty-five years. The City currently collects a 5% franchise fee from three commercial haulers who operate in designated zones within the City. The City has also imposed a 8.25% recycling fee per commercial account (not subject to the franchise fee) to cover the City's costs for planning, administration, and recycling programs. The City of Ventura currently awards annual operating permits for commercial refuse collection, yet is moving toward a long term franchise agreement. Beginning July 1, 1992, the City will set the maximum rates charged for solid waste management services. Honorable City Council Commercial Solid Waste Franchise Review July 1, 1992 Page 3 Similar to Moorpark, the County of Ventura awards non-exclusive (without zone restrictions) franchise agreements for solid waste collection throughout the county's unincorporated area. The County sets the maximum rates and the haulers pay the County a 5% franchise fee and a 5% percent solid waste management fee. The Cities of Agoura Hills, Calabasas, Camarillo, Santa Paula, and Westlake Village currently do not regulate commercial refuse service. The aforementioned cities, except for Agoura Hills and Westlake Village, are considering exclusive commercial franchise agreements. The other Cities in Ventura County either provide in- house services, or do not restrict the number of commercial service providers. STAFF RECOMMENDATION Staff recommends that the City Council direct staff as deemed appropriate.