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Home My WebLink AboutAgenda Bill 2.A-Attch1 08/23/2004City of Petaluma Collection and Disposal �ervicesProposals Evaluation Report and ,Staff - Recommendations Ezialuation Re-vort August 23, 2004 City Council Meeting Outline ®f Presentation -Council Direction Requested Backgf.0-u-nd- ➢ -Evaluation. Report Diversion Approaches s-ti Costs and Estimated d Avera ge Rate Impacts Changesto Collection and Street Sweeping Company Considerations and Summary of Key Strengths ➢ C ouncil Input, Needed ➢ Achieving AB 939Compliance ➢ Determining Proposal Process Compliance - ➢ Balancing Cost- and Diversion ➢ Selecting Future Franchise Hauler ➢ Contract 'Otk[tiotig - . ➢ Schedule ➢ Attachments 1. 'Proposed Operational Arrangements 2. Exceptions to Franchise Agreement qWHilton Farnkopf &'Hobson, LLC City of Petaluma Franchise Procurement Process* Paize No. 2 3 21 22, 26 27 28 29 30 40 Pagel • Evaluation Report Citu of Petaluma a August 23, 2004 City Council Meeting Franchise Procurement Process u ci E""irection.Requested Tj ® Counc=1 direction for select%on of the future fta hchi-se hauler and c-o-tractg -_e oations ® Franchise hauler selection)=re� wires thefoll.-Owing - Council input: - Identification of method of achieving AB 939 compliance Determination of proposers' c°omplance with the proposal process = Indication of preferences related to balancing cost and - g diversion `Hilton Farnkopf & Hobson, LLC Page 2 �7 Evaluation Revort Cihl of Petaluma August 23, 2004 City Council Meeting Franchise Procurement Process Background ® RTP issued -January 20, 2004 Responses -Propasals received -March- 19, 2004 Empfre Waste Managment (EWM): GreenWaste Recovery (GWR) - Norcal Waste Systems, Inc. (—NO'tcal) Letter, -commitment received March 191 2004 from, North Bay Co - rporation (North Bay) -co m- mittin-,9"-to its April 30,,, 2003 proposal -. Letter received Jul'Y -21 '2004 revising EWM's. proposal Proposal summary and, company presentations May 3, 2004, Company interviews May 13, 2004. * Preliminary evaluation report to Council June 7,2004 * Facility tours June and July 2004 q`Hilton Farnkopf & Hobson, LLC Page 3 • Evaluation Report City of Petaluma.() August 23, 2004 City Council Meeting Franchise Procurement Process �� Evaluation Report: iver°sio Approaches Scenario ..... _--.._._._..._ :.. _....,__._................--._ ....._...... _ _ EWM �.... .. _....__ .----.. .... _ ...I.. GWR .. _ _ ..._.. T. _..,.._... Norcal North Bay 1' Compliance.- _ - Comply- with.Regional Agency programs and policies* 2 50% Diversion - • .Residential food waste. GWR did.not�submit Norcal to work with City Did not props �. Accomplishb_y June _200.6 separate proposals: for 50, to define programs for 60;. and 70% diversion, but different` diversion -levels: 3 60% Diversion •Commercial food waste rather GWR proposes to Norcal proposed- costs and • Aggressive :comet. recycling Achieve- 70% or more programs f6r.70%°. Aggressive variable rates- diversion through the diversion as follows: • Accomplish by June 2008 following: •. New MRF in City with • Composting residential sortlines for solid, waste and organic recyclables; C&D, -- - materials commercial solid waste • Wet/dry-collection for • Residential and multi family and commercial food waste 4 70% Diversion • Grant exclusive right's_ o all commercial--, collection materials composting wet • Diversion rate to be • Ban paper from solid waste materials; sorting dry quantified using AB 939 • Wet/dry commercial • Accomplish by mid- methodology collection; sort dry at future 2005 • Programs for different County facility types of businesses • Accomplish by June 2010 • Accomplish by 2007 * interview with the City on May 13 offered residential food waste upon contract North Bay, during its interv' y y p act commencement Hilton Farnkopf & Hobson, LLC Page 4 se Evaluation Report Cite of Petaluma August 23, 2004 C4 Council Meeting Franchise Procurement Process EvaWation' R"' eport: Diversion Ap roaches (cont.) P Scenario EWM .GWR Norcal North Bay mp in City can- 'Pros/Cons Pros: 'Phased implementation Pros: Achieving 70% or -provi e Did not propose Pros. allows for phased costs more cdr=N accomplished" input to planning and Cons: Achieving 70% - -.immediately desigh-,pfocess* for new requires policy changes Cons: Ift- some lications facility. solid wastecompting.has Cons:. Siting and been problematic because permitting,a material of concerns related to recovery facility in the marketing materials and City may be challengmg; -environmental standards. higher, diversion will -not occur iwfirst Year of - agreement Ao%k qWlHilton Farnkopf &Hobson, LLC Page 5 Evaluation Report_ . City of Petaluma August.23, 2004 Cittj Council. Meeting . Franchise Procurement Process Evaluation Rep®rt. _ ate : �i' od.,One Costs andNIPV (millions) -Scenario EWM GWR Norcal North Bay 1 _'AB 939 through Regional Agency - = FirstRatePeriod (16 mos.') - - $12.6 $11.9 $12.8 - $15.1 - $8.5 Net PresentValue of Contract $70.1 $65:1 _ -_ $716 - $818 $46.9 1 AB 939 through Agency- Redwood Disposal Opt. First Rate Period (16 mos.) $1=0.8' $1:0.3 $1'0'.6 = $.12.9 $6:7 Net Present Value of Contract $.60:.1 $55.8 $59:6 - $71`.8 $37.4 2 50% diversion - 'To be First Rate Period (16 mos.) $11 0 Not applicable determined if Did not Net Present Value .of Contract $61.3 - selected -propose 3 60% diversion. To "be First.RatePeriod (16 mos.) $11.6- Not applicable determined`if Did not - Net Present Value of Contract $62.7 selected. _ propose 4 70% diversion - First Rate Period (16 mos.) $122 $10.8 Approx $19 Did not Net Present Value of Contract '$65.8 $59.4 Approx $109 propose Notes: 1. - For Scenario 1, costs reflect Central Landfill solid waste fee increase from $50 per ton to-$70 per ton and yard waste fee increase from $29 to $31 per ton. For Scenarios 2, 3, and 4 costs do not include estimate of posts to replace JPA programs. 2. NPV does not include franchise fees, vehicle impact fees, or costs of replacing JPA programs. 3. EWM costs, for Scenarios-2, 3, and 4 do not include costs of programs that are implemented in later. years. 4. Norcal guarantees not to exceed the high end of the cost range -shown for Scenario 1 and 10, but proposes to initially set rates assuming v, the low end of the cost range, review actual costs, and make future rate adjustments for any shortfalls. Hilton Farnkopf & Hobson, LLC Page 6 Evaluation Report City of Petaluma August 23, 2004 City Council Meeting Franchise Procurement Process Evaluation Report: Estimated Average Rate Impact* Scen-ario � ,-. - I EWM I - GWR . I Norcal North Bay 1 Compliance with AB 939 - 41% 3.4% 44°fo to 6.9%t (5%)I - through Regional Agency 1 . AB 939 through Agency; 2:1% 15% 19% to 45%t (24%) Opt. Redwood Disposal 2 50% diversion I 23%* *--- 3 = 60% diversion I 30%* * ---- 4 70% diversion 37%* * 21 % Appr-ox 11.8% --= - - * Rate impact considers 3:6%o rate decrease° approved: by- Council_ on tune 7. For. Scenario 1, rate. impact reflects Central Landfill solid waste fee increase from $50 per ton to, $70 per ton, and yard waste fee increase from $29 to $31 per ton. Scenarios 1 Opt., 2, 3, and do not anticipate use of County facility but rather anticipate use of Redwood Landfill for disposal; estimated rate impact does not include estimate of replacing JPA programs. Norcal guarantees not to exceed.the high end of the range shown for Scenario 1, but proposes to initially set rates assuming the low end of the range, review actual costs, and make future rate adjustments for any shortfalls. North Bay presented an alternative rate proposal that results in an average rate increase of 2.2% (0.3% for residents, 5.9% for commercial customers, and 1 % for drop box customers).. ** EWM costs for Scenarios 2, 3, and 4 do not include costs of programs that are,implemented in later years. Hilton.Farnkopf & Hobson, LLC Page 7 Evaluation Report August 23, 2004.City Counczi'IVIe_eting Evaluation eort Citu of Petaluma aO` Franchise Procurement Process -Estimated Dates for 60-Gallon Customers Scenario I EWM f GWR I Norcal North Bay 1 Compl'iance with AB 939 . $21.63 $20.48 $21.98 to $14.531 . through_R- nal Agency $25`:33 __ 1 AB 939`through Agency ; S- 8.48 '$17.6& $18.28 to $ l L59 Opt. Redwood Disposal $22.23t 2 50%-diversion $18.88* Not' applicable To be Did not determined if propose - selected 3 o _6:0 /o. diversion $a 9..98 * Not applicable - To be Did not _ determined if propose selected 4 70% diversion $20.93* 1 $18.58 $33.38 Did.not - propose * Current rate for 60-gallon residential customers is, $15.33 per month,'which reflects the '3.6% o rate decrease approved 'by Council on June 7. Estimated rates for Scenarios 2, 3, and 4 do not include estimate of replacing JPA programs. Norcal guarantees -hot to exceed the high end of the range shown for Scenario 1, but proposes to initially set rates assuming the low end of -the range, review actual costs, and make future rate adjustments for any shortfalls. North Bay presented an alternative rate proposal that results in an average rate increase of 2.2% (0.3% for residents, 5.9% for commercialcustomers, and l% for drop box customers). ** EWM costs for Scenarios 2, 3, and 4 do not include costs of programs that are implemented in later years. Hilton Farnkopf & Hobson, LLC' Page 8 • • w Evaluation Report Citv of Petaluma August 23, 20-04 City Council Meeting Franchise Procurement Process E Rep valuation -K ort: Changes- to Collection Services ➢ Single -Family Collect commingledC re yclables weekly Collect yard trimmings weekly .('rather than every other week-) Provide back -yard or-sid-e-yard service at no charge for- disabled - ➢ Multi -Family Require weekly commingled recycling service ➢ 'CommerC ial Require commingled recycling, service Require contractor to offer yard waste collection at additional fee Charge businessfor special. services (e.g., enclosures, heavy containers, cleaning, rental, push/pulls) ➢ Downtown public litter containers — more frequent collection (up to 3 times per week) *Hilton Farnkopf &Hobson, LLC Page 9 • Evaluation Report, -cit-V of Petaluma August. 23, 2004 City Council Meeting T-1 Franchise Procurement Process llUaLtIVII IN-UPO L. C ang s --eet Sweeping' Services h e, to St -I Residential.. streets Weekly °sweep ingNovember 1 to'February 28; and leaf collection crew preceding weeper Every other er week sweeping March I to October 31 Residents to receive map shDwin"g,schedule ➢ Downtown district, Daily sweeping Twice monthly washing. Sweeping -after special events City facilities ® Weekly sweeping of 2 City facility/public parking lots ® Every other- eek sweeping of 5 City facility/public parking lots ® Sweeping of 5 -public -lots after July 4 *Hilton Farnkopf &Hobson, LLC Page 10 Evaluation•Report - CituofPetaluma August 23, 2004 Cihj CounciLMeeting Franchise, Procurement Process Evaluation e ort: Ent ireWaste Management p p Advantages_ _ -Early implementation .of programs at City's option — Transition impacts limited. only to program changes - Known contractor and track record — 3 0-year operating history in Petaluma — Demonstrated supporter of community — Ex'istin-g, permitted facilities (except new organics processing =operation at Redwood landfill) - Disadvantages — Second highest cost. proposal = — High diversion requires substantial policy changes — Uncertainty associated timeline for developing a facility in Petaluma Hilton Farnkopf & Hobson, LLC Page 11 • EvaluationReportCity of Petaluma August 23; 2004 City Counci1,1V1eeting Franchise Procurement Process EVdI ation xe aorta Empire Waste Management. Clonte Franchise- Agreement Additions Diversion scenario/programs-selected. and implementation schedule - organics processing, site development plans, timeline; cost_ per ton plus annual .adjustment--ii echan sm, and contingency plan _ — Landfill- indemnification (including future host fees) — Establishing landfill .franchise :fee rebate mechanism — Drop=off facility_ for yard trimming- and wood waste Early -implementation 0f some..or all services - Street sweeping after. special events — Expanded list of recyclable mat.erial,s (non -CRT e=scrap; small appliances) — Free disposal at Redwood Landfill for annual clean-up of bulky items. (if Redwood Landfill i&.selected as disposal site) — Used equipment depreciation schedule and future costs, if any Hilton, Farnkopf & Hobson, LLC Page 12 Evaluation Report ON of Petaluma V August 23, 2004fity Council Meeting Franchise-ProcurementProcess .... E va,Report-: Green Waste Recovery 1 afion Advantages-= Aggressive, diversion strategy Using innovative approach Reduced residential 8treet-traffic-and, wear and tear by use- of split -body 'trucks Partnered with loc-al company (Industrial, Carting, Global Materials. Solutions) for recyclables processing Second lowest cost proposal w Disad-vantages- Long hauling contributes to Bay- Area traffic and air emissions Split -body trucks may have some load. balancing problems Solid waste composting has been problematic in some applications; risk of long-term marketability of compost product; risk of liability related to contamination of compost product Uncertainty- associated with timeline for permitting transfer activities at industrial Carting site Hilton Farnkopf & Hobson, LLC Page 13 Evaluation Report Citu of Petaluma August 23,-2004 City Council Meeting Franchise Procurement Process Evaluation Report,:Green Waste .xecovery (cont.) Franchise Agreement Additions — Cost -control measures related to _split -body truck -operations, and transfer hauling costs that _may'be impacted by futuretr-affic conditions — Ind_emnfcation, for compost -product liabilities Contingency plan/inde:mnifi.cation related to long-termmarketability of compost product — Transfer facility permitting schedule and contingency plans -. Landfill indemnification — Annual processing and disposal costs CPI adjustment mechanism — -Expanded list of recyclable materials (small scrap -and cast aluminum; small -scrap metal; textiles; batteries, polystyrene) _ qW Hilton F_arnkopf & Hobson, LLC Page 14 Evaluation Report Citu of Petaluma ' August 23, 2004 City Council Meeting, Franchise Procurement Process Evaluation Report: Norcal 0. Advantages - May-. develop new recyclables processing facility in or near. City, which may- result. -in less vehicle impacts and potential economic benefits — Flexible approach that, encourages. strong City involvement in fac_ lity design to determine services and costs T - - Commitment of labor, and vehicle resources higher than other proposers — If facility in .City, -fewest vehicle miles, lowest air and. traffic impacts - Company presents a strong commitment to diverting materials .and researching future opportunities - ® Disadvantages - - Higher cost than other proposals = bong- haul to recycling -,site (Scen. 1) contributes to -traffic/air impacts — Long haul to organics site contributes to Bay Area traffic/air impacts Uncertainty related to timeline for facility development in Petaluma — May select site elsewhere — Uncertainty related to City's role and level of control for new facility Hilton Farnkopf & Hobson, LLC Page 15 Evaluation Report Citu ofPetaluma August 23, 2004 City Council'Meeting — Franchise Procurement Process :Evaluation Report: �Torcal (cont.-) ® Franchise. Agreement -.Additions Diversion scenario/programs selected;:, implemen_ tation. schedule, and cost adjustments, if any _ — Recyclables processing facility ® Development,- construction 'and plans - ® Roles and responsibilities of contractor and City - - ® Timeline Costs and c-ompensation mechanism Interim plans and, contingency plans - - Annual organics processing cost CPI adjustment mechanism — Used equipment depreciation schedule and future costs, if any Expanded list of recyclables materials for Scenarios 2-.— 4 (textiles; scrap metal; all plastic including film and polystyrene) Hilton Farnkopf & Hobson, LLC Page 16 • Evaluation Report August 23, 2004 Citi� CouncillVleeting _Evaluation Repo Citu of Petaluma °; ' Franchise Procurement Process rt.: North Bay ® Advantages — Lowest cost — $300,0.00' annual contribution to City = Additional franchise fees of approximately $132,000=annually from recyclables revenues 'and portable toilet business - Existing, permitted facilities — Commitment to build new recyclables processing facility ® Disadvantages r — Diversion program commitment- does) -not -extend beyond 50%=state compliance requirements Hilton Farnkopf & Hobson, LLC Page 17 • a • Evaluation Report ON o{Petaluma ° ' August 23,.2004 City Council Meeting Franchise Procurement Process Evuatiron Re ort e North a(cont.) Y Franeh. se Agreement -Additions — Cost control- provisions or rate -based compensation _mechanism — $3 0.0,:000 annual =contribution to City - — Reporting_ and'franchise fee payments :for recyclables revenues and. . portable -toilet -business — Diversion scenario%programs selected; implementation schedule, and cost- adjustments, if any — New recyclables processing facility ® Timeline Costs and comp:ensation.mechansm ® Interim plans.= and contingency, plans Used equipment depreciation schedule and future costs, if any — Inclusion -of proposed service enhancements. (refer to page 3 5) �`r Hilton Farnkopf & Hobson, LLC Page 18 Evaluation Report City of Petaluma < ` O August 23, 2004 Cihj Couneit Meeting, Franchise Procurement Process = • Evaluation R%,ep®rt: Sum— mar Y of Companies-' Key _ = EWM : GWR Norcal North Bay Estimated Average •21%o Scen. l Opt 15% Scen. 1 Opt. 45% Scen. -1 Opt (24%).-S.cen.. I Rate, Impact - 37% Scen. 4 o -- - '21 Scen. 4 _ o ' __Approx 11..8 %.Scen. 4 O t p Key Strengths • Early- - • Aggressive diversion -Potentially may develop a • Lowest cost , implementation, of strategy'using new recyclables processing . $3:00,000 annual programs at City's innovative approach facility in or_near the .City, contribution City option • Reducedresidential which may result in less -to .Additional franchise ` • Transition impacts street traffic .and wear vehicle impacts and fee s:of approximately limited only -to and tear through use potential. economic $132,0.00 annually. - program changes of split -body trucks benefits from recyclables • Known contractor- •. Partnered with local ° Flexible approach that revenues and portable and track record company (Industrial encourages, strong City toilet business • 30- ear operating y P g Carting, Global involvement to determine ; Existin ermined gp history in Petaluma Materials Solutions) service& and costs facilities • Demonstrated -for recyclables • Commitment of labor and • Commitment to build- . supporter of processing vehicle resources is higher new recyclables ' community than other companies processing facility. in Existin ermitted g' p ° If facility in City, fewest Santa Rosa facilities vehicle miles traveled, thus - least air and traffic impacts qW Hilton Farnkopf & Hobson, LLC Page 19 Evaluation Report Cihi of Petaluma °' ' August 23, 2004 City Council Meeting. Franchise Procurement Process. 'Evalua tion Ke ort Summary ®f Compan�es' _KeyWeakness - EW1V1 GWR Norcal North Bay Key Weaknesses Secorid. highest cost _Long hauling • Higher cost than other _ Diversion program proposal; = contributes to -Bay Area ;proposals commitment;does not - - High diversion traffic :and air • .L'orig haul, to recycling, extend. beyond- 5,0% 'requires substantial emissions site. (Seed. 1) contributes state compliance policy changes • .Split=body trucks may to traffic/air impacts requirements • Uncertainty have, some load • Long haul to -organics site associated timeline balancing problems contributes to Bay Area for developing a ° Solid waste composting ' traffic/air impacts ` facility in=Petaluma has, been problematic in . Uncertainty related to some applications; risk timeline for -facility - _ - of tong -term development. -in Petaluma - marketability of • May select site elsewhere compost product; risk _ Uncertainty related to of.liability related to City's role and level of contamination of control for newfacility =` compost product _ ° Uncertainty associated with timeline for = permitting transfer activities at Industrial Carting site �` Hilton Farnkopf & Hobson, LLC Page 20 Evaluation Re -port City of Petaluma V August-23,.2004 City Council.Meeting Franchise Procurement Process Council Input- Needed: Achieving AB 939 Compliance 1Vlethod -0fachieving, A-B 939 c o-m'- -pli dnce dictates diversion scenarios -fo-be-considered • Options. JPA Responsibility (Use of countyfacilitiesdictates Scenario .1 proposals), City Responsibility (Use of out -of county facilities dictates Scenarios 2, 3. and 4 proposals) OHilton Farnkopf & Hobson, . LLC Page 21 p t" Evaluation Report Cite of Petaluma August 23, 2004 City Council Meeting Franchise Procurement Process . ..... Council input Needed'. Deternlini-ng Pro oral Process- Compliance, Staff and consultant determined durin-g-propos-al review that proposals. and. scenarios were in compliance with RFP with a few exceptions (=refer to list on he following page.,.,) c - f non -compliant 's or scenarios Acceptance 0 om proposals s-a '- influences number and type of prop. o.. Is and/or diversion - scenarios, available for consideration- qVHilton Farnkopf &Hobson, LLC Page 22 0 0' Evaluation Report August'23,'2004 City Council Meeting' Council Input Needed: Citv of Petaluma Franchise Procurement Process Detergo al Pro'Prmplince ('ont.) , inpos,cess CO ac Proposaf-Considera - tion - Staff Recom ' mendation 2A. Accept Noical",s alternative -Scenario I cost Do,not accept because reduced co-st-Propos4l,is not proposdt-redudionihat-pro PIP-ses2-50/( lower rates . ' substantiated with cost information (and is. not therefore in in rate periods, I and 2 and 'a "make-up" substantial compliance liance with1he RFP), and -risk of actual -adjustryient—Overthe f6thaininglefin. costs beiiig.'higher. resultitig,in future cost increases 2B. t� Accept Scenario 2.= - 4:cost-proposalAccept Nor6al-'s Scenario -2 — 4 cost proposal for - although cost proposal does- not provide consideration because it is in substantial compliance with substantial support for its capital and operating the RFP costs and is subj 60to. adjustment based on site selected and facilitydesign 2C; Accept North Bay Qorporation's (North Bays) Accept.Noirth Bay's,Aptil 30, 2003 proposal for letter reaffirming its April,30, 2003 proposal. consideration, because North Bay's Apri1.30,2003' proposal'is in substantial _compliance with the RIP 2D., Accept -North Bay'.s April 30,2003 proposal Ac_c.epfNdrt_h.BWs April 30,2003 proposal because it although.cost proposaF§eems unbelievably low in substantial compliance with-the"P although the when considering all of the extraservipes, but its nature of -North -Bays �'s cost -proposal is unreasonable stated profit level isr$285,000 in the,firstyear. 2E. Accept EWM revised --proposal described,in-its Do not accept EWM July 2,1,:200.4 revised proposal July,2 Hotter which proposes to provide services because it is not in substantial compliance with RFP; it at rates in effect prior. o the -3 decrease provides insufficient information; and it presents approved June 7,2004. substantially better cost proposal after knowing its competitors' cost proposals 2F. Accept EWM'spfqosa-ls,for Scenarios 2, 3, and Accept EWM's proposals for Scenarios 2, 3, and 4 4 although, EWM'si -cost proposal does not.reflect because they are in substantial compliance with the RFP costs of future programs that they anticipate' needing to implement.to meet the diversion goals. *Hilton Farnkopf & Hobson, - LLC. Page 23 Evaluation Report Cih0f 'Petalumd UM August.23, 2004 City Council Meeting Council Input Needed. Franchise Procurement'.Process Determining Pro ®.sal Process Compliance -- Date .Period One Costs and NPV (millions) . . __ . _...... . ... ...... _ _ ... Scenario.. EWM_ CrWR cal Nor North Ba Y 1 AB 939. through. Regional Agency First Rate Period (16.mos.) $f2:6 $1.1.9 $15..1 $8.5 Net PresenvValue .of'Contract - $70.1 _ $65:1 $83.8 $46.9 1 AB 939 through Agency; Redwood Disposal Opt. First Rate -Period (16 mos.) . $10.-8 $10.3 $12.9 $6.7 Net Present Value of Contract $60.1 $55.8 $711.8 $37.4 2 50% diversion To be First Rate -Period (16 mos.) $11.0 Not applicable determined if Did not Net Present:Value of'Contract _ $61.3 selected propose 3 60% diversion -To-be - First Rate Period (16 mos;) $11.6. Not applicable d'etermined.if Did not Net Present Value of Contract $02.7 selected propose 4 70% diversion First Rate Period (16 mos.) $12.2 $10.8 Approx $-19 Did not Net,Present Value of Contract $65.8 $59.4 Approx $109 propose. Notes: 1. For Scenario 'l, costs reflect Central Landfill solid waste fee increase .from $50 per ton to $70 per ton and yard waste fee increase from $29 to $31 per"ton. Scenario 2, 3, and 4 costs do not include estimate of costs to replace JPA programs. 2. NPV does not.include franchise fees, vehicle impact fees, or costs of replacing JPA programs. 3. EWM costs for Scenarios' 2, 3, and 4 do not include costs of programs that are implemented in later.years. Hilton Farnkopf & Hobson, LLC Page 24 a • Evaluation Report Citu-of Petaluma °' August 23, 2004 City Council Meeting Franchise Procurement Process "° Council Input Needed: Determining Proposal Process Compliance Estimated Rates for 60-Gallon Customers* Scenario EWM GWR - Norcal North .Bay 1 Compliance with AB .939 $21..63 $20.48- - $25�.33 $14.531 through Regional Agency. 1 AB 939 through Agency; $18.48 $17:68 $22.23 $11.59 Opt. Redwood Disposal 2 50% diversion= $,18,88** Not applicable To be Did not determined if propose selected 3 60% diversion $19.98 �` Not applicable - To�be Did not deterniined'if propose , selected 4 70% diversion $20.93 * * $18.5 8 $3 3.38 Did not propose Current 60-gallon residen ial rate is $15.33 t' � per month ,which reflects the 3.6 /o rate decrease approved * ° roved by Council on June 7. Estimated rates for Scenarios 2, 3, and 4 do not include estimate of replacing JPA programs. $ North.Bay presented an alternative rate proposal that results in an average rate increase of 2.2% (0.3% for residents, 5.9% for commercial customers, and 1 % for drop box customers). * * EWM costs for Scenarios 2, 3, and 4 do not include costs of programs that are implemented in later years. Hilton- Farnkopf & Hobson, LLC Page 25 W, Evaluation Report Citii of Petaluma August 23, 2004 City Council Meeting Franchise Procurement Process CouncilInptNeede, --_t3alancing,Cost and Diversion, ® -value with :regardlo -cost and :commit ent to achieving/exceed ng AB 939 diversion -influences scenario -selection and hauler selection ® Options: = Prioritize cost, by selecting lowest diversion scenario (Scenario 1) — Prioritize diversion at reasonab-lle� cost Eby selection. Scenarios 2, 3' and/or 4 - - Staff recommendation=: Prioritize diversion at a reasonable, cost to .be consistent with Councils, previously expressed . policy (which supported higher diversion by directing the focus of the p on diversion levels- of 50%, 60%, and 70%) Hilton Farnkopf & Hobson, LLC Page 26 Evaluation Report Citu of Petaluma 4' August 23,. 2004 City Council Meeting - Franchise Procurement Process Council Input 'Needed: Se�e ctin - r Future Franchise Hauler ® Alternative 1:.Select E M R, and%or-Norcal for further cons erathon if: - — AB 93 9 compliance -by-.City — Acceptance of EwM Scenario 2, 3, and 4 and Norcal Scenario 2 — 4 — Prioritization o.f, diversion at reasonable cost ® Alternative 2: --Select North B ay. if: — Prioritize- cost over -diversion _ - - Acceptance of North Bay's.. 2003 proposal — AB 939 compliance by JPA (use county -facilities) or AB 939 compliance by City (use Redwood facilities) Hilton Farnkopf & Hobson, LLC Page'27 Evaluation Report Ghl of Petaluma Augusf23, 2004 City CouncilMeetingFranchise Procurement Process Council Inv% ut Nee - e - Contract Ne'gotiations ® Staff recommends; . at a minimum, that the additions to =- franch_ se agreements for E�TM l�,Norcal; and. No=rth i daR y (listed on slides 12, 14; 1°6, and =$, respectively) be considered during negotiations with the selected franchise hauler(s) Hilton. Farnkopf & Hobson, LLC Page 28 Evaluation Report : ` . ON of Petaluma August 23, 2004 City Council Meeting Franchise Procurement Process _ Co= _- ncll Input Needed:- Summary - - Achieying.AB'939'". . Corr Through JPA - I I By Gty - ,:................... ......z.:..:.;.. ,.., .:,:, .. Deterininin is ion No: '3`.': • .. e `':.;� Frei osel Process': p .. I ..BalancingGost • . . and t7iversion ,...s. Prioritize cost Balance diversion over diversion I and cost - r----_-- V _ ................ V ® I Scenario 1 I_ Scenarios 2, 3, and 4 Unacceptable Acceptable_ I " proposals proposals and - and scenarios scenarios .;:._.• ":�:� " :[Decision"No:N4: ' .:;select Future , --------------- ,Sel"ct u ure.,- f Franchise • -#iauler Hauler:: , North Bay I EWM (Seen. 2 or 3), GWR (Seen. 4), or Norcal (Seen. 2 - 4) Hilton Farnkopf & Hobson, LLC, Page 29 . Evaluation Report Cihl of Petaluma 4 ' August 23, 2004 Cihj Council Meeting Franchise Procurement Process Schedule Council direction regarding contractor selection August 23, 2004 -: Negotiations with one or more companies - Sept =Nov, 2004 Council direction_ regarding' _- _ _ _ November 15, 2004- ® Commencement of New -Services = March L 2005,* * The commencement date may .need to be postponed to allow the selected company adequate time to purchase new equipment and implement services. Hilton Farnkopf & Hobson, LLC Page 30 Evaluation Report Citu of Petaluma a' August 23, 2004 Ci.tlj Council Meeting Franchise Procurement Process - Attachment I - Residential Collection Method EWM GWR Norcal North Bay Routing, _ ,- 3 passes by separate drivers Scenario 1: Split body vehicles; 2 = 3 passes by separate Miilti-purpose Method passes by 2 drivers. drivers vehicles (3 .passes by 'Scenarios 2 — 4; Split -body 1 driver) - _ vehicfes; 1 pass -by 1 driver - Collection Vehicles Used New -Carts New and used New Pros/Cons Pros: Collection of all Pros: Split -body truck°reduces containers can occur at traffic loading on streets arid.. same time of day increases safety in residential areas Cons: Used vehicles may due to fewer passes; new vehicles. cause more route disruption Cons: Use of split -body trucks due to breakdowns and may may have volume balancing be more prone to fluid problems leaks- used carts may have higher breakage rate. Hilton Farnkopf & Hobson, LLC. Used Used/reconditioned (1990 or newer) New New Pros: Collection of -all Pros: One driver containers can occur at serves each house same time of day-. and "knows" Cons: Used vehicles customer. may cause more route Cons: Used vehicles disruption, due to may cause more breakdowns and may be route disruption due more prone to fluid to breakdowns and leaks. may be more prone to fluid leaks. Page 31 Evaluation Report Citu of Petaluma ° August 23, 2004 City Council Meeting _ Franchise Procurement,Process Attachment 1 (cont.) -Commercial Collection Method - EW- M. GWR Norcal North.Bay ,Routing - Scenarios l = 3: Scenario ,1:. Standard Standard Standard ;- Approach Standard — Scenarios_ 2 — 4: Wet/dry-- Scenario_ .4:-- Wet/dry -method method Collection Front loaders: Used New Front loaders: Used Refurbished (1990-or Vehicles (averagei manufacture, (average manufacture newer)' date 1999) date 2004) Drop box: Used 1998 Drop box: Used (age not specified) Containers New and used New New New Pros/Cons Pros: Wet/dry collection Pros: Wet/dry collection Cons: Refer to -previous Cons: Refer to previous may result in increased may result in increased page regarding used- page regarding used diversion. diversion vehicles. _ vehicles,. Cons: Refer- to previous page regarding used vehicles, Hilton Farnkopf & Hobson; LLC' Page 32 E • • Evaluation Report 0hi of Petaluma V August 23' 2004 Cit 9 y Council, Meeting Franchise Procurement Proces - s Attachment I. (cont.) — Vehicle Yard and Office EWM Santa Rosa Existing Pros: Existing, permitted facility. -Same site as currently used. Cons: As compared tosiie, in City, long ' collection vehicle drive'time to and from site each day qW Hilton Farnkopf & Hobson, LLC GWR Norcal North Bay -Santa Rosa. In Petaluma,or just Santa Rosa outside City limits ternative; Soanta _Rosa)-=' Existing Propose to develop new 'Existing; but propose facility to develop new -facility by 2005 Pros: Existing, permitted Pros: Least collection Pros: -Existing, fadlity._ -Hauling vehicle off -route permitted facility arrangements similar to hauling. Cons: hs: As compared to current situation.. C6ns: Proposer has not site in City, long -Cons: As compared to site secured site;, site -may _ collection vehicle in City, long collection require quire land, use permit drive time to and from vehicle drive time to and and, capital- site each. day -from, site ,each day improvements; mprovements, proposer .may select site located elsewhere (i.e., in Santa Rosa). Page 33 Evaluation Report City of Pefaluma August 23,-2004 City Council Meeting Franchise- Procurement Process Atta6inent 1 (cont.) —Disposal Site Facilities EWIvI- ` GWR Norval North Bay Disposal Site Scenario 1: Central Scenario 1: Central Scenarios 1 - 4- Central Scenario 1: Central Landfill Landfill* Landfill* Landfill* Scenarios a = 4.: Central or Scenarios 2 — 4 - Potrero. Redwood.Landfill Hills Landfill Per: -Ton Central Landfill: $70 Central Landfill: $70'. Central Landfill: $7.0 Central Landfill:. $70 TippingFee Redwood- Landfill: $36.87 . -Potrero-Hills Landfilt (4417. less $7.5.0 franchise , less-.tlian $20 fee:rebate) = Pros/Cons - Pros: Low cost.. compared Pros: Low=cost Pros: City commitment Pros: City to Central;_ Redwood-LF Cons: -Long fiaul to to JPA; close -to, City commitment to JPA; _ - close to City-tlius._limited Potrero LF (however only close to City traffic and -air impact residue from composting P g Cons: High cost; Cons: Redwood is out -of- and recyclables processing uncertainty related to Cons: High cost;" county thus.may require delivered Ip P.otrero L•F);, -costs, particularly uncertainty related to departure from 7PA and. LF is. out=of county, thus given current landfill future costs, City provision;of (and mayrequire departure problems particularly.given . payment.for) services = from' JPA and City current landfill currently handled by JPA provision of (and payment . problems = for) services currently handled by JPA *Company is willing to use°alternative landfill selected by the City. `Hilton Farnkopf & Hobson, LLC Page 34 Evaluation Report Citt�: of Petaluma August.23,,-2004- Citij Council Meeting Franchise Procurement Process _ Attachment.1 (coast.) — Recyclables Processing Facilities, orcal North Bay - Recyclable EWM facility in Santa Global Materials Scenario 1: California Proposed new North Materials, _ _ Rosa. - Recovery/Industrial Carting Waste Solutionfacility in Bay.facility in Santa. Processing ,Site facility in Santa Rosa _ -Oakland - Rosa to be operational Scenarios .2 — 4: Proposed by end of 2005 use new facility in or just e-xistirig`North Bay outside City; alternative prgcessingfacility in proposal -to acquire.. site Santa, Rosa until new elsewhere in County. facility complete. Per -Ton Net. ($30) $5 residential materials ($7.65) residential mtls, ($33) Cost (Revenue) : $5.0 commercial -dry mtls ($39.60) commercial rritls Pros/Cons Pros: Existing; permitted -Pros: Existing, permitted ' Pros: Minimal collection Pros: New state:-of-tfie--._ facility. _ facility.- vehicle off -route, hauling; . art,facility;, site selected - Cons: Additional Cons: Additional propose new state-6f7the- 'Cons: Use, permit and collection vehicle drive collection vehicle drive art facility ,. capital improvements time to, and from site time to and.:from site each Cons- Proposer. has not needed; additional drive each day compared to day compared to site in secured site, permits may time to and.from site site in City City be challenging and/or. time each day compared to - consuming to secure; may site in City - select site elsewhere; long haul to recycling facility compared to others Hilton Farnkopf & Hobson, LLC Page 35 Evaluation Report _ City of Petaluma a ' August'23,2004 Cithj*Council Meeting Franchise Procurement Process Attachment 1 (cont) - Organics Processing Facilities EWM- GWR Norcal North Bay Proposed.Orgam' Propose`EWM-s Redwood. GWR's affiliate's Z-Best Norcal's Jepson-Praire. Not applicable Materials Facility in Novato subject to Facility in, Gilroy via transfer" Facility near -Vacaville (North Bay did Processing and permit approval;=alternatiwe of materials, at Industrial = not:propose Composting Site GWR's affiliate's" Z-Best Carting.'s Santa Rosa Scenarios 2 — 4) (Scenarios 2 — 4)Facility inGilroy via 'transfer facility. Note:, Proposing,- of materials of EWM's to compost solid waste.and Redwood -facility in Novato organic waste. _ Tipping Fee. Separate costs not°included $42 per"ton $35 per ton Pro_ s/cons_ Pros: Z-Best permitted and Pros:, .:Z-Best-permitted and Pros: Site is permitted and operational, site with -proven operational -site.- e operational; proven track - track record ofcom ostin p g : Cons: Solid waste record for and and food y , yard waste and food waste. composting been _ waste composting. Cons: Long haul that problematic in some Cons: Long=haul that contributes to Bay Area' ;applications; transfer at contributes to Bay Area _ traffic and air emissions. Industrial Carting-'s site traffic and air emissions. requires regulatory approval; long haul that contributes to Bay Areatrafficand air emissions. *Scenario 2 — 4 information presented in table. For Scenario 1, all yard waste processing to occur at Central -Landfill at $31 per ton. Hilton Farnkopf & Hobson, LLC - Page 36 Evaluation Report Cihi of Petaluma August 23,-2004 City Council Meeting Franchise Procurement Process Attachment-.1 (cont.) - Personnel, Routes, and Route Hours EWM: G)XIR Norcal North Bay Average Personnel Route Personnel. .18.6 19.0 24,0 .15.0 17.9 Other Personnel 7.8 10.9 14.0 7.5 -1.0 Totat Personnel 26i4 28.9" 38.0 22.5. 18.9 Number of Routes 18.60 19."50 .2.2.47 16.21 19.19 Route Hours per Year 38151.6,8-8 40,560 46,1698 *Scenario I data presented. WHilton Farnkopf&HobsonjLC Page 37 Evaluation Report August 23; 2004 Ci Council Meetin Cite of Petaluma O g Franchise Procurement Process_ 'Attachment 1 (cont.) -Vehicle Impact Anal s ` (Miles per Year) - _ EWM I --....- GWR Norcal .._.._ ......North Bay _.. Average._.. Residential Route Miles 32,448 21,632 (Scen 1) 32,4.48 32,448 29,744 - _ 10,816 (Scen 4) Residential and Commercial Non -Route, Miles Scenario 1: _ 14403' .151,770 1' 16,612 174,790, 146,796 Scenario ,2: 195,517 Not applicable Not applicable Not applicable Not applicable Scenario. 3: 200,715 Not'applicable Not applicable Not applicable Not applicable Scenario 4: M1,3;14 295,242 103,897.. Not applicable 200,1.51 Notes: Analysis does not reflect mileage associated with hauling recyclable or compost materials to market. Assumes City centroid is the intersection of E. Washington Street and Ellis Street. Hilton Farnkopf & Hobson, LLC . Page 38 Evaluation Retort City of Petaluma. August 23, 2004 City Council Meeting Franchise Procurement Process .-Attachment 1 (cont.) - Proposed Service Enhancements ® EWM Street sweeping after special events. _ — Expanded l°st. of.recyclable materials (non -CRT e-scrap; small appliances) — Free disposal at, Redwood Landfill for annual .clean=up of bulky items (if _ Redwood Landfill. is selected as disposal site) — Early implementation of single -stream collection and weekly yard waste ® GWR Expanded list of recyclable materials (small scrap and cast aluminum; small scrap metal; textiles; batteries; polystyrene) Norcal Expanded list of recyclables materials for. Scenarios 2 — 4 (textiles; scrap metal; all plastic including. film and polystyrene) Pa e 39 Hilton Farnkopf & Hobson, LLC % Evaluation Report -itu.of Petaluma August 23, 2004 City Council-, Meeting Franchise Procurement Process Attachment 1 (cont.) - Proposed Service Enhancements = - -North_ Bay = Annual ,$300,�000 contribution, to City for use in funding:civic goals Additional franchise fees. of approximately. $132,00.0 annually_ from recyclables revenues, and- portable toilet business Free collection-for.public schools and Santa Rosa Junior College if schools include recycling; estimated $21,000 savings Free portable toilet service at all City -sponsored and non-profit events Residential food -waste collection at start-up (processed at Central Landfill) Street sweeping at -municipal events - Free commercial recycling (depending on n the rate, structure selected) _ Free multi -family and commercial yard trimming collection if -they perform their own landscaping and- do -not use outside contractor Expanded cufstomer service hours .(Sat 7 a.m. to 1 p.m.) Curbside collection* of loose holiday trees (rather than cut and placed in carts) Accept TVs and CRTs for a fee at- their existing buy-back and drop-off facility, at 2543 Petaluma Blvd. South, and during annual drop-off event for a fee WHilton Farnkopf & Hobson, LLC Page 40 Evaluation Report - City of Petaluma August 23, 2004 City Council Meeting g Franchise Procurement Process - Attachment 2 = Exceptions to Franchise Agreement* _ EWM GWR ' Norcal North Bay • Depreciation,period less than • Lien process to -be • Compensation for actual See note below 10 years; additional_ capital established for delinquent costs plus a 10% rate of expenditures (not included in accounts or right to return -in Rate Periods One cost proposal) during term to terminate service land Two. _ replace used equipment. •Set rates annually based on --.Net recycling revenues (i.e.,, actual costs and operating gross revenues less processing ratio costs) are "below the line."' so • 'State diversion calculation revenues do not reduce profit methodology Proposed Rate Period Two • Diversion, certification, and costsaubject to adjustment to reporting for,haulers reflect growth collecting C&D, commercial No market test of rates recyclables, and materials _ • No guarantee for-60%a or 70% from public schools diversion level • Net,recycling revenues (i.e., • Scenario 4: Exclusive rights gross -revenues less for all materials -(including processing costs) are "below C&D), or City to establish the�l'ine" so revenues do not- - comparable diversion reduce profit benchmark=for-haulers • Lien process established or collecting; C&D and eliminate cap on bad debt commercial recyclables • No market test of rates * Additional exceptions to franchise agreement, which have been made by some companies and appear to be _ negotiable items, are not shown here. . Hilton Farnkopf & Hobson, LLC ) Page 41 • Hobson LLC Hi o.n-Famkopf & Advisory' Serviceslo Municipal Management ,