REPORT TO THE CITY COUNCIL
December 17, 2015
FROM: THOMAS C. ESQUEDA, Director
Department of Public Utilities
BY: JERRY L. SCHUBER SR., Assistant Director
Department of Public Utilities, Solid Waste Management Division
SUBJECT
Title
Authorize amendments to Non-Exclusive Agreements for Roll-Off Collection Services between the City of Fresno and franchisees to extend terms for five years to June 30, 2021.
Body
RECOMMENDATION
Staff recommends Council approve an extension to agreements between the City of Fresno and the current list of non-exclusive franchise roll-off haulers for an additional five years, through June 30, 2021.
EXECUTIVE SUMMARY
The City Council approved an ordinance establishing a non-exclusive roll-off collection franchise system for private haulers under City Charter Article XIII, Section 1300 on July 21, 2011. Sixteen companies were approved as franchisee at that time. Since then, six additional companies have applied and been approved to become franchisees. This non-exclusive franchise is projected to generate $613,200 in FY16. Consistent with the initial agreement, the City may extend the term of the agreements by five years with Council authorization and written notice to the haulers 180 days prior to the end of the agreement. Extending these agreements would generate more than $3 million in General Fund revenues over the next five years.
Therefore, staff recommends a five year extension of the current agreement to June 30, 2021.
BACKGROUND
On July 21, 2011, City Council approved an ordinance establishing a non-excusive roll-off collection franchise system to regulate roll-off hauler collection activities.
The volume of roll-off materials collected is approximately 20-25% of the solid waste stream and highly recyclable, therefore the City has implemented the system to:
• Comply with current and anticipated State regulations related to the diversion of such materials from landfill diversion;
• Implement the goals of the City’s AB 939 Plan including the Source Reduction and Recycling Element as adopted by the City Council;
• Support the goals of the City to achieve 75% diversion by 2012 and Zero Waste by 2025, which were adopted by City Council by establishing minimum diversion standards for roll-off materials (50% of C&D materials and 70% of recyclables); and
• Increase the fees received from these companies from the previous material diversion fee of $17.70 per service location to a 10% franchise fee. In FY 2015, the City anticipates receiving approximately $613,200 in total annual franchise fees from roll-off haulers.
Roll-Off Hauler Application Process
Haulers may apply to the City to obtain a non-exclusive roll-off franchise. The applicant must describe and/or provide:
• Information about the company
• Qualifications of the company, which must include:
― Names and addresses (1) officers, directors, and associates; (2) persons and entities having five percent or more of ownership; and (3) Any parent or subsidiary or business entity owning or controlling in whole or in part applicant
― Description of applicant’s experience
― Municipal references
― Customer references
― Proof of insurance
― Litigation and regulatory history
― Criminal history
• Operations Information
― Diversion plan
― Description of equipment (trucks and containers)
― Collection schedule
― Description of the types of materials to be collected
― Processing facilities collector intends to use
― Hazardous waste procedures
― Customer service plans
― Billing services
• Other information that may be requested by the Director of Department of Public Utilities.
The current list of approved haulers includes twenty two entities, see Attachment B
If approved, the Director of the Public Utilities Department, or designee, will send notice to each of the haulers extending of its current agreement as a non-exclusive roll off hauler. Each hauler will then have thirty days to return written notice of their agreement to continue to participate in the program.
ENVIRONMENTAL FINDINGS
Pursuant to the California Environmental Quality Act Guidelines Section 15378 this item does not qualify as a “project” and is therefore exempt from the California Environmental Quality Act requirements.
LOCAL PREFERENCE
Local preference was not implemented because a franchise ordinance and the award of a non-exclusive roll-off franchise is not an award of a services or construction contract
FISCAL IMPACT
In FY 2016, the City anticipates receiving approximately $613,200 in total annual franchise fees from roll-off haulers. Expected revenue for the remaining five years is based on tonnage and customer participation. Over the past 5 year term of the agreement the City of Fresno has received revenues of $3,018,983 from non-exclusive roll-off.
Attachments:
Ordinance - Attachment A
Non-Exclusive Franchise Haulers - Attachment B
Sample Letter and Sample Agreement - Attachment C