HomeMy WebLinkAboutAGENDA REPORT 1995 0215 CC REG ITEM 11FTO:
FROM:
DATE:
SUBJECT:
BACKGROUND
AGENDA REPORT
CITY OF MOORPARK
Honorable City Council
Jill R. Myers, Solid Waste Coordinator
l�
February 9, 1995 (CC Meeting of February 15,
Consider Negotiations for Residential and
Refuse Contracts
ITEM • �.
1995)
commercial
As you are aware, Moorpark has a franchised system for solid waste
collection services. In 1990, the City awarded exclusive franchise
agreements to Anderson Rubbish and G.I. Rubbish for residential
service and each hauler services a designated residential area or
zone. The residential franchise agreements are due to expire on
June 30, 1995. In 1991, the City awarded nonexclusive franchise
agreements for commercial refuse collection. A commercial customer
may select any of the four franchised commercial haulers (Anderson
Rubbish, E.J. Harrison and Sons, G.I. Rubbish, and Rubbish Control)
to provide service. Service fees are negotiable, however, the City
sets the maximum rates that a commercial hauler may charge. The
commercial franchise agreements were originally due to expire on
June 30, 1994. However, the City Council approved two six (6)
month term extensions and the commercial agreements will now expire
at the same time as the residential agreements (June 30, 1995).
The City also offers Temporary Refuse Collection Permits on an
annual basis. Temporary service is that which is provided on a
nonregularly scheduled basis. Service to construction, demolition,
and landclearing projects would be typical types of temporary
service. Four haulers currently hold Temporary Permits - Anderson
Rubbish, Browning- Ferris Industries (BFI), E.J. Harrison and Sons,
and G.I. Rubbish.
In November 1994, the residential haulers (Anderson Rubbish and
G.I. Rubbish) requested a monthly recycling rate increase along
with the request for a refuse rate increase. G.I. requested a
recycling increase of $0.28 per household and Anderson requested
$0.49 per household increase to the current recycling rate of
$1.70. As you are aware, at the December 7 City Council meeting,
the City Council approved a $0.20 increase to the residential base
(refuse) rate. However, staff needed additional information from
the haulers to make a recommendation, so the recycling portion was
not presented with the refuse rate review.
00108
Honorable City Council
Refuse Contract
February 15, 1995
Page 2
For the last two months, the Public Works, Facilities, and Solid
Waste Committee (Councilmembers Montgomery and Wozniak) and staff
have met with the residential haulers to discuss their respective
recycling rate requests and staff's findings. As a result of those
meetings, the haulers revised their recycling rate request to $0.15
per household.
At the January 31 Special Meeting of the Public Works, Facilities,
and Solid Waste Committee, the Committee discussed the haulers'
request for the $0.15 recycling rate increase. Because both the
residential and commercial franchise agreements are due to expire
on June 30, 1995, the Committee questioned the residential haulers
about how the upcoming contract negotiations would affect
residential refuse and recycling rates.
At this time, the residential haulers (Anderson and G.I.) could not
say if the rates would change. The haulers indicated that they are
proposing an exclusive franchise agreement that includes
residential and commercial service to be provided by the two
residential haulers. The haulers indicated that an exclusive
agreement would provide a better balance for both the residential
and commercial rates. The City of Simi Valley was cited as an
example. In 1993, Simi Valley awarded exclusive franchises to
Anderson and G.I. for residential and commercial services. The
result of the exclusive franchise negotiations allowed Simi Valley
to discontinue its subsidization of refuse rates without increasing
the residential service fees. The haulers indicated that the new
commercial rate structure contributed to the stabilization of the
Simi Valley residential rates.
The City Council has the following options to consider in regards
to negotiation of the refuse contracts:
I. Continue with the exclusive residential and nonexclusive
commercial franchise systems Under this option, the City may
renew the residential franchise agreements and negotiate new
commercial nonexclusive franchise agreements with the current
commercial haulers (no change to the current systems).
The current residential franchise agreement has a five (5)
year renewal clause. Section 16B of the franchise agreement
states that the City Council may direct staff to conduct a
review prior to the expiration of the agreement to determine
if the hauler has satisfactorily complied with the Agreement
terms and conditions. If it is determined that the hauler has
satisfactorily complied with the terms and conditions of the
Agreement, the City Council may grant a renewal of the
001.09
Honorable City Council
Refuse Contract
February 15, 1995
Page 3
Franchise for a period not to exceed five (5) years. If the
City Council determines to grant a renewal, Council may review
the terms and conditions of the Agreement and the Municipal
Code to determine if there is a need for modifications.
The current commercial franchise agreement does not contain
any renewal language.
II. Continue with the exclusive residential franchise system and
haulers and issue a competitive bid for nonexclusive
commercial franchise collection services This scenario
differs from the commercial scenario outlined in option I.
Instead of negotiating with only the current commercial
haulers for nonexclusive service, the City would issue a
competitive bid to all interested haulers for nonexclusive
commercial service.
III. Continue with the exclusive residential franchise system and
grant an exclusive commercial franchise to the two residential
haulers. An exclusive solid waste franchise system has
haulers providing services to designated areas or zones at
rates set by the City. Exclusive commercial services differs
from our current nonexclusive commercial franchise system.
Under an exclusive franchise, haulers will provide service to
designated commercial areas. The City will set all rates for
commercial service, not only the maximum rates. Anderson and
G.I. proposed that they be granted an "all- exclusive"
agreement (both haulers providing residential and commercial
services). The haulers indicated that the residential rates
for services could be offset by the updated commercial rates
set by the City.
California Public Resources Codes (PRC), Sections 49520 and
49521, address the legal authority for local agencies to grant
exclusive franchises and hauler notification requirements.
The City Attorney has advised staff that if Moorpark changes
from a nonexclusive commercial franchise system to an
exclusive commercial franchise system with Anderson Rubbish
and G.I. Rubbish as the service providers, and since the
existing commercial franchised haulers have provided service
for more than three years, the City must provide those haulers
notification of the City's intent to award exclusive
commercial franchises. The other commercial franchised
haulers may continue to provide services up to five years
after receiving mailed notification. These haulers will also
adhere the negotiated franchise obligations and adopted rate
schedules set by the Council.
00110
Honorable City Council
Refuse Contract
February 15, 1995
Page 4
At the January 31 Special Meeting, no agreement was reached between
the haulers and the Committee regarding the ($0.15) recycling rate
increase request. Because of the upcoming contract negotiations
and the uncertainty at this time about future rate increases or
decreases, the Committee suggested that the residential haulers
forgo the requested monthly recycling rate increase until after the
conclusion of the contract negotiations. Based on the results of
the negotiations, it was agreed that the haulers may have the
opportunity, if necessary, to retroactively recapture agreed upon
recycling losses.
Additionally, the Committee requested staff to prepare a report to
the full Council to receive concurrence to negotiate exclusive
agreements with Anderson Rubbish and G.I. Rubbish to provide both
residential and commercial collection services. The Committee also
recommended that the Council appoint an Ad Hoc Committee to begin
negotiations with the haulers.
RECOMMENDATION
The Public Works, Facilities, and Solid Waste Committee and staff
recommend that the City Council:
1. Appoint an Ad Hoc Committee to proceed with negotiations.
2. Direct the Ad Hoc Committee to negotiate exclusive
franchise agreements with the Anderson Rubbish and G.I.
Rubbish to provide both residential and commercial
collection services, and issue PRC notification to the
remaining commercial franchised haulers of the Council's
intent to award exclusive commercial franchises.
00111