SCHEDULED ITEM
D-1
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
VIA: SERGIO GONZALEZ, CITY MANAGER
FROM: TIKAN SINGH, GENERAL MANAGER
DATE: JULY 20, 2026
SUBJECT: PUBLIC HEARING OF THE PROPOSED INCREASE IN REFUSE
COLLECTION AND ORGANIC WASTE RECYCLING SERVICES
EFFECTIVE AUGUST 1, 2026
BACKGROUND:
SB 1383 (Short-Lived Climate Pollutants) is a California law designed to reduce methane emissions by increasing the diversion of organic waste from landfills. The law requires jurisdictions to implement programs that support organic waste recycling and reduce the disposal of food waste and other compostable materials.
To comply with SB 1383, the City has made significant changes to its solid waste collection and disposal programs. As part of these efforts, the City Council approved a contract amendment with Athens Services at its June 1, 2026 City Council meeting to transition commercial and multi-family customers into a three-stream collection system. Under this system, customers will separate waste into three containers: trash, recyclables, and organic waste. This change is intended to improve diversion rates, reduce landfill disposal, and ensure compliance with state organic waste recycling requirements.
RECOMMENDATIONS:
Staff recommends the City Council take the following actions:
1) Open the Public Hearing, receive public testimony, and close the Public Hearing; and 2) Adopt Resolution No. 2026-C42 approving the annual refuse collection and organic waste recycling rate adjustment for Arakelian Enterprises, Inc. dba Athens Services effective August 1, 2026, and if approved to be adjusted by Consumer Price Index (CPI) beginning July 1, 2027, and every July 1st thereafter for a five-year period, through and including adjustments on or after July 1, 2031.
Approval of Refuse and Organic Waste Recycling Rates 8/1/2026 July 20, 2026
ANALYSIS:
The City of Azusa has an Exclusive Franchise Agreement (Agreement) with Arakelian Enterprises, Inc., dba Athens Services (Franchised Hauler) for refuse collection and recycling services. To comply with the requirements of SB 1383, the City Council approved the 30th Amendment to the City’s franchise agreement with Athens Services at the June 1st City Council meeting to transition commercial and multi-family customers into a three-stream collection system. Under this system, customers will separate waste into three containers: trash, recyclables, and organic waste. This change is intended to improve diversion rates, reduce landfill disposal, and ensure compliance with state organic waste recycling requirements.
At this Public Hearing, the City Council will be considering the adoption of refuse collection and organics recycling services rate schedule effective August 1, 2026, and if approved, the new rates will be adjusted based upon the annual percentage changes in the Consumer Price Index (CPI) as determined by the United States Department of Labor Statistics, All Urban Customers, for Garbage and Trash Collection. Pursuant to Proposition 218, refuse and organics rate adjustments must be approved at a public hearing, with public notice 45 days in advance. The Public Hearing Notice was mailed on June 4, 2026, and advertised in the local newspaper on July 3, 2026.
The updated rates will incorporate a revised calculation of the City’s estimated direct costs of providing services and facilities associated with the solid waste operations, and those estimated costs will replace the former franchise fee that was calculated based on a percentage of the rate revenue paid for services provided by Athens.
The proposed increase to solid waste service costs (Net Rate) is necessary to enable the City to cover the costs incurred, through Athens Services, to meet state-mandated requirements under SB 1383 and AB 939, including the collection, processing, and disposal of solid waste. In addition to the portion of costs incurred through Athens Services, the proposed rates also include the City's franchise fee, which covers the City’s estimated direct costs of providing services and facilities associated with solid waste operations, including impacts on public infrastructure, right-of-way use, and City services directly supporting solid waste operations. The AB 939 portion funds recycling programs, including costs to comply with the City’s SB 1383 procurement target.
Beginning July 1, 2027 and every July 1st thereafter for a five-year period, through and including adjustments on or after July 1, 2031, trash rates may be adjusted automatically without a further public hearing, according to CPI plus one percent capital replacement charge (CPI+1), with a minimum increase of 3%; provided, however, the trash monthly rates shall not increase by more than 10% in any fiscal year. Notice will be provided by mail at least 30 days prior to the effective date of such increase.
The proposed rates effective August 1, 2026 are summarized in Attachment 1.
Approval of Refuse and Organic Waste Recycling Rates 8/1/2026 July 20, 2026
FISCAL IMPACT:
The recommended actions do not result in a net new fiscal impact to the City. The proposed amendments update the structure of existing solid waste-related revenues, including the franchise fee, to align with the City’s cost of providing services and regulatory requirements.
Prepared: Reviewed by:
Liza Sagun Talika M. Johnson
Acting Environmental Programs Manager Director of Administrative Services Reviewed by: Reviewed and Approved:
Tikan Singh, PE Sergio Gonzalez
General Manager City Manager
Reviewed and Approved:
City Attorney
Burke, Williams, & Sorensen, LLP
Attachments:
1) Resolution No. 2026-C42
2) Public Hearing Notice
1 RESOLUTION NO. 2026-C42
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA,
CALIFORNIA, APPROVING THE REFUSE COLLECTION AND
ORGANIC WASTE RECYCLING SERVICES RATES EFFECTIVE
AUGUST 1, 2026 THROUGH JUNE 30, 2027
WHEREAS, on October 2, 2000, the City Council of the City of Azusa, approved an Exclusive Franchise Agreement with Arakelian Enterprises, Incorporated (known as “Athens Services” and referred to as “Contractor”), for refuse collection and recycling services ("Original Agreement"); and
WHEREAS, on November 1, 2021, the City Council of the City of Azusa, approved the 26th Amendment to the Amended and Restated Franchise Agreement with Contractor for refuse collection, recycling and disposal services ("Amended Agreement"); and WHEREAS, Section 5.0(B) of the Amended Agreement requires that the refuse collection, recycling and disposal services rates charged by the Contractor to end user customers (property owners and tenants) be modified annually to account for the cost of living changes, disposal costs, and other adjustments due to extraordinary increases in operating costs ("Adjustments") on July 1 of each year; and
WHEREAS, refuse rate adjustments have been calculated pursuant to the terms and conditions of the Amended Agreement; and
WHEREAS, SB 1383, the Short-lived Climate Pollutant Reduction Act of 2016, requires CalRecycle to develop regulations to reduce organics in landfills as a source of methane. The regulations place requirements on multiple entities including cities, residential households, commercial businesses and business owners, commercial edible food generators, haulers, selfhaulers, food recovery organizations, and food recovery services to support achievement of statewide organic waste disposal reduction targets; and WHEREAS, the City is required by state law to implement an organics waste recycling program for residential and commercial customers that are required by SB 1383 to implement organics waste recycling; and
WHEREAS, in order to implement the organics recycling program in the City is offering, through the Contractor, organics recycling services to residential and commercial businesses (customers) that are required to implement an organic recycling program under SB 1383, and the City authorizes the Contractor to charge these customers that utilize such services for the cost of those services; and
WHEREAS, consistent with the terms of the Agreement, the Contractor submitted a request to update to rates charged to customers for solid waste services, as described in this Resolution, and City has determined that the requested update to solid waste rates complies with the requirements of Agreement Section 5.0 and establish rates designed to generate revenue estimated to cover the reasonable proportionate cost of providing the solid waste services to each 2 customer class, with differential costs based on size of containers and frequency of collection and other relevant factors for proportionately allocating costs of services provided to each customer class, in accordance with the requirements of Proposition 218 (California Constitution Article XIII D, Section 6); and
WHEREAS, the Solid Waste Rates described in this Resolution include a component cost for Monthly Organics Waste Recycling Rates, applicable to all residential and commercial customers required to comply with SB 1383 effective January 1, 2022; and, if approved, the new rates will be adjusted based on a 30-day prior written notice provided annually to be effective every July 1st, through July 1, 2031. The amount of each annual adjustment shall be based upon the annual percentage changes in the Consumer Price Index (CPI) as determined by the United States Department of Labor Statistics, All Urban Consumers for Garbage, and Trash Collection; and
WHEREAS, the City intends this Resolution to implement automatic rate adjustment beginning July 1, 2027, and each July 1 thereafter for a five-year period, through and including adjustments effective on or before July 1, 2031, by which the trash rates may be adjusted annually, upon a thirty-day prior written notice provided to customers in accordance with Government Code Section 53756, without a further public hearing, with the amount of each annual adjustment calculated according to CPI plus one percent capital improvement charge (CPI + 1), with a minimum increase of 3%; provided, however, the monthly rates shall not increase by more than 10% in any fiscal year.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Azusa, California, does find and declare that:
SECTION 1: Adoption of the Rates. The attached Refuse Collection and Organic Waste Recycling Services Rate Schedule (Exhibit A) is hereby approved. This Rate Schedule shall supersede any previously adopted rate schedule.
SECTION 2: Effective Date. This Resolution shall become effective upon its adoption.
SECTION 3: Adoption of Automatic Rate Adjustment. If approved, beginning July 1, 2027, and each July 1 thereafter for a five-year period, through and including adjustments effective on or before July 1, 2031, the Solid Waste rates may be adjusted annually, without a further public hearing. Each annual adjustment shall be based on a 30-day prior written notice provided in accordance with Government Code Section 53756. The amount of each annual adjustment shall be calculated based on CPI plus one percent capital improvement charge (CPI + 1), with a minimum increase of 3%; provided, however, the trash monthly rates shall not increase by more than 10% in any fiscal year. Each annual adjustment shall be based upon the annual percentage changes in the Consumer Price Index (CPI) as determined by the United States Department of Labor Statistics, All Urban Consumers for Garbage, and Trash Collection. No annual rate adjustment shall exceed 10% in any single year without conducting a public hearing in accordance with Proposition 218 to consider that proposed rate adjustment; and SECTION 4: Authorization. That the Mayor shall sign and the City Clerk shall certify to the passage and adoption of this Resolution.
PASSED, APPROVED and ADOPTED this 20th day of July, 2026. 3 ___________________________________
Edward J. Alvarez
Mayor
ATTEST:
___________________________________
Jeffrey Lawrence Cornejo, Jr.
City Clerk
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss.
CITY OF AZUSA )
I HEREBY CERTIFY that the foregoing Resolution No. 2026-C42 was duly adopted by the City Council of the City of Azusa at a special meeting thereof, held on the 20th day of July, 2026 by the following vote of Council:
AYES: COUNCILMEMBERS:
NOES: COUNCILMEMBERS:
ABSTAIN: COUNCILMEMBERS:
ABSENT: COUNCILMEMBERS:
___________________________________
Jeffrey Lawrence Cornejo, Jr.
City Clerk
APPROVED AS TO FORM:
___________________________________
Burke, Williams, & Sorensen, LLP
City Attorney
EXHIBIT A
August 1, 2026-June 30, 2027
4 Refuse and Organics Recycling Rates
Table 1. Residential and Multi-Family Cart Services
Table 2. Additional Services
5 Table 3. Commercial Organics
6 7
Table 4. Optional Additional Services
PROPOSITION 218 NOTIFICATION
PUBLIC HEARING FOR
REFUSE AND ORGANICS RATE ADJUSTMENT
EFFECTIVE AUGUST 1, 2026
NOTICE IS HEREBY GIVEN that pursuant to Article XIIID of the California Constitution, the City Council of the City of Azusa will hold a PUBLIC HEARING to consider adjustments in rates for trash collection and recycling services effective for bills rendered on or after August 1, 2026. This notice is being mailed to the address of each owner of record, as well as each tenant customer’s billing address, for each identified parcel subject to trash rates. Said PUBLIC HEARING will be held at the regular meeting of the City Council of the City of Azusa on MONDAY, JULY 20, 2026, at 7:30 P.M., or as soon as possible thereafter, in the Civic Auditorium, 213 E. Foothill Boulevard, Azusa, CA 91702. The City Council will consider adopting a trash collection and recycling rate schedule, effective August 1, 2026, as shown in Tables 1 - 4 below.
Read below for more information about this adjustment.
What Is Organic Waste?
Organic waste means food waste, green waste, landscape and pruning waste, organic textiles and carpet, lumber, wood, paper products, printing and writing paper, manure, biosolids, digestate, and sludge.
Why Are Mandatory Organics Recycling Services Being Established? In September 2016, Governor Jerry Brown signed SB 1383 into law. This law is intended to reduce the emissions of climate pollutants (greenhouse gases) by 1) diverting 75% statewide disposal of organic waste from landfills by 2025 and beyond; 2) recovering at least 20% edible food instead of throwing in the trash by commercial food generators by 2025; and 3) procuring recycled organic waste products for use within the City. To achieve these requirements, the law imposes certain obligations that will affect trash collection in the City of Azusa, its franchised hauler, and all residents and businesses.
As a result of this state-imposed regulation, the City must require residents and businesses to separate organic waste from trash and recyclables for processing at a facility other than the landfill. To accomplish this, all property owners, residents, and businesses will be required to enroll automatically in collection services for trash, recycling, and organic waste. Failure by the City to comply with the law can result in penalties of up to $10,000 per day.
What Services Are Funded By The Trash Rates?
Athens Services bills customers directly. Rates are based on customer type (residential, multifamily, commercial), container size, type of waste collected, and service frequency. The proposed increase to solid waste service costs (Net Rate) is necessary to enable the City to cover the costs incurred, through Athens Services, to meet state-mandated requirements under SB 1383 and AB 939, including the collection, processing, and disposal of solid waste. In addition to the portion of costs incurred through Athens Services, the proposed rates also include the City's franchise fee, which covers the City’s estimated direct costs of providing services and facilities associated with solid waste operations, including impacts on public infrastructure, right-of-way use, and related City services. The AB 939 portion funds recycling programs, including costs to comply with the City’s SB 1383 procurement target.
How are the Trash Rates Adjusted?
Effective August 1, 2026, all trash monthly rates will increase as shown in Table 1. Those rates reflect an annual adjustment from current rates based on the annual percentage change (January to January) in the Consumer Price Index (CPI) for Trash and Garbage Collection (CUUR000SEHG02), U.S. City Average (not seasonally adjusted), as published by the U.S.
Department of Labor. For the purposes of this rate adjustment, the CPI change from January 2025 to January 2026 was 4.97%.
Beginning July 1, 2027, and every July 1st thereafter for a five-year period, through and including adjustments on or after July 1, 2031, trash rates may be adjusted automatically without a further public hearing, according to CPI plus one percent to cover capital replacement costs (CPI + 1), with a minimum increase of 3%; provided, however, the trash monthly rates shall not increase by more than 10% in any fiscal year. Notice will be provided by mail to customers at least 30 days prior to the effective date of any such adjustment.
How Do I Protest These New Fees?
Any record owner of a parcel upon which the trash rates are proposed (including any tenant directly responsible to pay the trash rates) may submit a written protest that must include: 1) your name (both printed and signed), 2) your street address, 3) your utility account number, and 4) an indication of opposition to the proposed rates. Written protests must be submitted on paper form. Oral, telephonic, or e-mailed protests will not be counted as a “written protest.” Written protests must be received by the City Clerk (not postmarked) prior to the close of the public hearing on July 20, 2026.
At the close of the public hearing, the City Clerk will provide the City Council with a final tabulation of all written protests received by the City. Only one protest will be counted for each parcel. Owners of multiple parcels may file one protest for each parcel. If timely written protests are received from owners of a majority of parcels (50% + 1) served by the solid waste services described in this notice, the proposed refuse rates will not be implemented.
A written protest may be delivered to the City Clerk by either of the following methods:
1) Mail or hand deliver a written protest to: City Clerk, City of Azusa, 213 East Foothill Boulevard, Azusa, CA 91702. Please identify on the front of the envelope that the enclosed letter is for the “2026 Trash & Organic Rates Adjustment Public Hearing”. OR 2) Attend July 20, 2026 Public Hearing at the time and place identified in this Notice and hand deliver a written protest to the City Clerk.
The staff report on the proposed refuse and organic waste recycling rates is available at the Office of the City Clerk, 213 E. Foothill Boulevard, Azusa City Library, 340 W. Fifth Street, and Azusa Light & Water, 729 N. Azusa Avenue, or on the City of Azusa’s website at www.AzusaCA.gov/947/Public-Hearings.
TABLE 1. RESIDENTIAL AND COMMERCIAL & MULTI-FAMILY
BUNDLE SERVICES
TABLE 2. ADDITIONAL TRASH SERVICES
TABLE 3. COMMERCIAL ORGANICS
TABLE 4. OPTIONAL ADDITIONAL SERVICES