HomeMy WebLinkAboutStaff Report 1.A 11/14/2005CITY OF PETALUMA, CALIFORNIA
AGENDA BILL.
LA
November 14, 2005
Aeenda Title: Interim Disposal Update and Resolution Authorizing Meeting Date: Nov 14, 2005
City Manager To Enter Into Interim Disposal Arrangements With
Redwood Landfill and Marin Sanitary Service.
Meeting Time: 6:00 PM
Category (check one): ❑ Consent Calendar ❑ Public Hearing ❑ New Business
® Unfinished Business ❑ Presentation
Department: I Director: I Contact Person: Phone Number:
City Manager I Michael Bierman I Michael Bierman 707 778 4345
Cost of Proposal: $393,105 to $496,988 Account Number: n/a
Amount Budgeted: Name of Fund: none
Attachments to Aeenda Packet Item:
1. Memo From City Manager To City Council
2. Resolution Authorizing Interim Disposal Arrangements
3. Letter from Marin Sanitary
4. Staff report from June 20, 2005
Summary Statement:
As a result of the closure of the Sonoma County Central Landfill and the extended time required to award a
new refuse collection contract, increased competition for available landfill space has resulted in the City of
Petaluma needing to make interim arrangements for disposal of solid waste until the end of the year. After
exploring all options, staff recommends entering into an arrangement with Waste Management and Marin
Sanitary Service to haul and dispose of the City's refuse for the remainder of the calendar year. Due to
increased fuel and disposal cost, additional costs will be incurred to allow refuse disposal for the remainder
of the year. Those additional costs will be funded through a combination of reserves, a credit against
refuse collection franchise fees and adjustments to future collection rates as may be required. A detailed
history of our efforts to resolve this issue is attached.
Recommended Citv Council Action/Suggested Motion:
Authorize City Manager to enter into interim disposal arrangements with Waste Management and Marin
Sanitary Service for the remainder of the year.
Reviewed by Admin. Svcs. Dir: Reviewed by City Attornev: Apnro ed by City Manaeer:
ate: � � (� � � ,pJ�� Date:
Todav's Date: Revision # a naie vised: File Code:
CITY OF PETALUMA, CALIFORNIA
NOVEMBER 14, 200$
AGENDA REPORT
FOR
Interim Refuse Disposal
BACKGROUND: As a result of the closure of the Sonoma County Central Landfill and
the extended time required to finalize a new refuse collection contract, increased
competition for available landfill space bad resulted in the City of Petaluma needing to
make interim arrangements for disposal of solid waste until the end of the year. After
exploring all options, staff recommends entering into an arrangement with Waste
Management and Marin Sanitary Service to haul and dispose of the City's refuse for the
remainder of the calendar year. Due to increased fuel and disposal cost, additional costs
will be incurred to allow refuse disposal for the remainder of the year. Those additional
costs will be funded through a combination of reserves, a credit against refuse collection
franchise fees and adjustments to future collection rates as may be required. A detailed
history of our efforts to resolve this issue is attached.
ALTERNATIVES: No acceptable alternative exists due to the lack of interim disposal
options from other landfill operators in the area. No alternative hauling option was
identified as being able to assume the remainder of the existing contract even if the
current contractor was willing to terminate their contract prior to the end of the year.
FINANCIAL IMPACTS: Depending on the amount of refuse needing to be redirected
from Redwood Landfill, some reduction in franchise fees is anticipated to cover the
increased cost to the hauler.
4. CONCLUSION: No acceptable option exists to provide continued collection and disposal
of refuse for the remainder of the year.
OUTCOMES OR PERFORMANCE MEASUREMENTS THAT WILL IDENTIFY SUCCESS OR
COMPLETION:
Continued collection and disposal of refuse without interruption to the public.
6. RECOMMENDATION: Authorize City Manager to enter into interim disposal option as
presented.
2
CITY OF PETALUM k CALIFORNIA
MEMORANDUM
City Manager's Office, 11 English Street, Pelahnaa, CA 94952
(707) 778-4345 Fxe(707) 778-4419 E-mail: cihnreifrdri.aetalama.ca.as
DATE: November 10, 2005
TO: Mayor and Members of the City Counc'
FROM: Michael Bierman, City Manager
9�1
SUBJECT: Interim Refuse Disposal
During our negotiations with Waste Management regarding a new contract for solid
waste collection and disposal, the option of a long-term refuse disposal service contract
was considered. Among the conditions of the option was a requirement to "put or pay"
regarding future disposal at the Redwood Landfill in Novato. At that point in the
selection process, staff was not convinced that an agreement for collection or disposal
was realistic, given various requirements requested by the Council to be included in the
final contract, and considering certain positions taken by Waste Management regarding
the contract document. Of particular concern was the long-term disposal agreement,
since agreeing to their proposal at that time would preclude the City from considering
alternative disposal options in the event a collection agreement was not reached between
the City and Waste Management, which, of course, became fact.
During this same time, we were notified by Redwood Landfill (Waste Management) that
they would be transferring approximately 160 tons of waste per day gate capacity to
Sonoma County, who also was looking for disposal options because of the closing of the
Central Landfill. Because we felt that we could not agree to a long-term disposal contract
with Redwood Landfill for the reasons listed above, Waste Management informed us that
they would not be accepting refuse from Petaluma at the Redwood Landfill after
November 16, 2005.
Subsequent events resulted in the awarding of a refuse collection contract to Green
Waste, Inc., out of San Jose, California to be effective January 1, 2006. Waste
Management agreed to an additional extension of their current collection contract until
the end of 2005. Disposal at Redwood Landfill, however, would end November 16,
2005. (Attached Council report)
We have been investigating options for temporary disposal of waste from November 16,
2005 until the end of December 2005. We contacted Mr. Michael Gross, Green Waste,
regarding the status of their disposal site search. He indicated that Green Waste was still
in negotiations with Marin Sanitary, Potrero Landfill and others regarding longer-term
disposal options. We discussed the immediate need for disposal from mid-November to
the end of the year. He suggested that we contact Marin Sanitary since they are involved
in the discussions with Potrero for disposal.
Staff contacted Marin Sanitary Services regarding the potential of Petaluma disposing, at
least on an interim basis, with Marin Sanitary until the end of the year. Marin Sanitary
indicated that a commitment had not been secured yet on a long-term disposal option, but
that they were sure that Marin Sanitary could accept MSW on a short-term basis until the
end of the calendar year. Marin Sanitary indicated a disposal fee of $55.29 per ton for
MSW.
Staff also spoke with Mr. James Devlin, Waste Management, regarding options for
disposal during this interim period. Mr. Devlin again confirmed the need to find
alternative disposal for the remainder of the year since Redwood Landfill had reached its
daily maximum intake capacity by accepting additional tonnage from Sonoma County.
On Monday, October 24, 2005, we received a copy of a letter from Marin Sanitary
agreeing to accept our waste during the six week period, citing tonnage rates for MSW,
debris and yard waste (see attached letter).
On Wednesday, October 26, 2005, staff met with Jim Anderson and Susan Klassen at the
County Administrator's Office to explore options for temporary disposal until the end of
the year. They indicated a capacity limit and other contractual obligations would prevent
them from giving a firm commitment. They would need to talk with others to see if
alternative disposals could be arranged and that such alternative might include additional
unknown costs to the City of Petaluma, as those contracting agencies would want us to
cover their additional expenses.
On October 26, Waste Management offered several potential options:
Option 1: Redirect Waste Flow to Marin Sanitary.
The additional Waste Management costs of direct haul to Marin Sanitary would be
approximately $410,000. These costs include the expenses associated with adding four
routes, including drivers and trucks. The $410,000 would not include disposal fees from
Marin Sanitary.
Option 2: Sonoma Countv Contract.
If we could use the Sonoma County contract with Redwood Landfill, we would pay the
county rate for direct haul to Redwood at an increase in cost of approximately $251,000.
Additional charges for the county redirecting their refuse would be added to that cost.
The tentative rate quoted by the county was an additional $54 per ton.
Ontion 3: Redirect Current Waste Manaeement Customer.
If Waste Management could find a current customer who could redirect their refitse, the
tipping fee at Redwood would increase by $14.60 per ton or approximately $80,000.
This fee does not include any expenses or compensation that could be required to induce
another customer of Redwood to redirect their disposal somewhere else.
We spoke again several times with Devlin and Gross and also made contact with Marin
Sanitary. As discussions progressed, it became clear that Marin Sanitary could not
redirect tonnage from Redwood Landfill that would allow Petaluma to continue disposal
at Redwood. Marin Sanitary would, however, still honor their proposal to accept refuse
through their transfer station in San Rafael and dispose via other landfill locations.
We spoke with Sonoma County staff and determined that the option to dispose through
an agreement with Sonoma County using their allotted capacity through Redwood
Landfill was not a viable option for them or the City.
On November 8, 2005, we received an alternative offer from Redwood Landfill that
would potentially lower the cost to the City in the event they were able to get another
customer to divert 80 tons per day from Redwood Landfill. Waste Management would
receive a fixed fee of $354,216, which includes additional transportation costs to Marin
Sanitary, the increase in tipping fees at Redwood Landfill over our current rate, and the
cost to induce another customer of Redwood to redirect their disposal. The tipping fees
paid to Mann Sanitary for the daily tonnage that would be sent there would be offset by a
credit of the current Redwood tipping fees for that amount of refuse. The total cost of
this offer would be approximately $393,105.
Summary of Viable Ontions:
Direct haul to Mann Sanitary
Waste Management Cost $410,236
plus Marin Sanitary Cost (145 tons x $55 x 33 days) 263,175
less Waste Management Credit (176,423)
(145 tons x $36.87 x 33 days)
TOTAL $496,988
2. Combination of hauling to both Redwood and Mann Sanitary: $393,105
Waste Management Cost $354,216
plus Mann Sanitary Cost (65 tons x $55 x 33 days) 117,975
less Waste Management Credit 79,086)
(65 tons $36.87 x 33 days)
TOTAL $393,105
We are proceeding with Waste Management to use the cheapest proposal (Number 2) and
will implement for the period of November 16, 2005 through December 31, 2005.
Payment of the additional hauling and disposal costs will be negotiated with Waste
Management and Marin Sanitary Service. It is anticipated that the cost will be paid using
our reserves; a credit against Waste Management's final franchise fee payments; and/or
recovered through future rate adjustment once our new collection service is operational.
I believe staff has fully explored all the options that are currently available to us. The
interim cost is significant but it is better than a $2 million dollar per year gamble on a
"put or pay" contract for refuse disposal that was before us in May. There really is no
choice but to contract with Waste Management as outlined above. The alternative of not
picking up and disposing of the garbage is not an option.
RESOLUTION AUTHORIZING CITY MANAGER TO ENTER INTO AGREEMENT
WITH WASTE MANAGEMENT AND MARIN SANITARY SERVICE FOR THE
INTERIM COLLECTION AND DISPOSAL OF MUNICIPAL WASTE FROM
NOVEMBER 16, 2005 THROUGH DECEMBER 31, 2005.
WHEREAS, the City of Petaluma is responsible for the removal and disposal of refuse
for the community; and,
WHEREAS, the City has been informed that insufficient daily capacity exists at
Redwood Landfill to meet the needs of the community; and,
WHEREAS, options for collection and disposal have been evaluated and a preferred
interim disposal method has been identified for the remainder of the calendar year.
NOW, THEREFORE, BE IT RESOLVED that the City Council hereby authorizes the
City Manager to enter into arrangements and execute any necessary documents and agreements
with Waste Management and Marin Sanitary Service or others to provide adequate collection
and disposal services for the remainder of the year so that refuse collection and disposal can
occur without interruption to the community.
OCT 214 2005
Sane ocaa CITY MANAGER
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Saga ,Raod, 64 94901
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a/a: (415) 453-140 �kne; (415) 48
(415)'453-6565 485-1509
October 21; 2005
Mr. Gene Beatty
Office of the City Manager
City of Petaluma
11 English Street
Petaluma, CA 94952 -
Dear Mr. Beatty:
This letter is to confirm that Marin Sanitary Service (MSS) will accept refuse and certain
other materials from the City of Petaluma during the period from November 16, 2005
through December 31, 2005.
The materials and the corresponding rates are:
MSW (garbage or refuse) $55.29/ton7
Debris $61.00/ton
Green Waste $38.00/ton
The MSW delivered will be transported to a landfill for disposal The debris will be
processed at our Resource Recovery Center and recyclable materials will be removed.
The green waste will be ground and recycled.
The hours of operation are Monday — Friday, 5:00 am — 3:30 pm, and Saturday, 7:00 am
— 5:00 pm. 'If the City decides to use our facility, we will need to schedule a meeting
with your contracted hauler to discuss our scale procedures and other operational issues.
I look forward to hearing from you.
Sincerely,
l�
Joise, J. o
Chairman of e oard
1050 Andersen Drive, P.O. Box, 10067, San Rafael, CA 94912 (415) 456-2601 (415) 456-7595 Fax
www.mafinsanitary.com
8
CITY OF PETALUMA, CALIFORNIA
AGENDA BILL
Agenda Title: Meeting Date: June 20, 2005
Resolution Authorizing Extension of Solid Waste, Recycling, Yard
Waste and Street Sweeping Franchise Agreement ,and Approving Meeting Time: ® 3:00 PM
An Increase of Maximum Rates of Four Percent (41/6) Effective July ❑ 7:00 PM
1, 2005.
Category (check one): ❑ Consent Calendar ❑ Public Hearing ❑ New Business
® Unfinished Business ❑ Presentation
Department: Director: Contact Person: Phone Number:
City Manager I Michael Bierman I Michael Bierman 707 778-4347,
Cost of Proposal: N/A Account Number:
N/A
Amount Budgeted: N/A Name of Fund:
Attachments to Agenda Packet Item:
1. Amendment 5 To Franchise Agreement
2. Resolution Extending Agreement and Approving an Increase of Maximum Rates of 4%
Summary Statement:
On May 16, 2005, the City Council directed the City Manager to negotiate up to a six month contract
extension with Waste Management to provide a continuation of service while the City continues
negotiations to resolve outstanding issues in a proposed Franchise Agreement with Empire Waste
Management. The attached amendment to the current contract provides for that extension of service and
allows for a rate increase of maximum rates of four percent (4%), effective July 1, 2005.
Recommended City Council Action/Suaaested Motion.:
Approve the amendment as negotiated.
Reviewed by Admin. Svcs. Dir:.
Date:
Today's Date:
June 13, 2005
Reviewed by City Attorney
Date:
Revision # and Date Revised:
ADDroved y City Manager:
VA Date:
File Code:
CITY OF PETALUMA, CALIFORNIA
June 20, 2005
AGENDA REPORT
FOR
Extension of Current Contract and Approval of Interim Rate Increase
EXECUTIVE SUMMARY: This resolution amends the existing waste collection franchise
agreement to extend the agreement from July 1, 2005 through December 31, 2005. It
also allows for an increase in rates charged by Empire Waste Management in maximum
rates of 4%, effective July 1, 2005. Empire Waste Management has waived any regular
rate increase afforded under the current contract during the selection process over the last
two years. No change in service is included during the extension period.
2. BACKGROUND: At the May 16, 2005 City Council meeting, the City Council directed the
City Manager to continue negotiations with Empire Waste Management in order to
attempt to resolve outstanding issues relating to the development of new collection
franchise and disposal agreements. The Council also directed the City Manager to
negotiate an extension of the current agreement for collection to allow up to an additional
six (6) months on the contract. As agreed to in the negotiations, the City will continue to
dispose of its refuse at Redwood Landfill at least until November 15, 2005. It is
anticipated that selection of a refuse collection and disposal agreement will be completed
by that date.
3. ALTERNAT[vEs: None. This amendment incorporates the direction of the Council to
provide uninterrupted service delivery during the selection and negotiations process.
4. FINANCIAL IMPACTS: A slight increase in franchise fee revenue will be realized as a
result of the 4% rate increase:
5. CONCLUSION: The extension of the current contract is necessary and the adjustments of
maximum rates are reasonable and required.
6. OUTCOMES OR PERFORMANCE MEASUREMENTS THAT WILL IDENTIFY SUCCESS OR
COMPLETION:
Contract extension will be signed and new rates implemented.
RECOMMENDATION: Approve the amendment as written.
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