Agenda Report
Fullerton City Council
MEETING DATE: MARCH 19, 2024
TO: CITY COUNCIL
SUBMITTED BY: STEPHEN BISE, DIRECTOR OF PUBLIC WORKS
PREPARED BY: JEROME JOAQUIN, ADMINSTRATIVE MANAGER
MICHELLE KESHISHIAN, SOLID WASTE AND RECYCLING SPECIALIST SUBJECT: SENATE BILL 1383 COMPLIANCE ACTION PLAN FOR SERVICES AND PROGRAMS RELATED TO SOLID WASTE, RECYCLING AND ORGANICS COLLECTION
SUMMARY
Request to proceed with Senate Bill 1383 (SB 1383) Compliance Action Plan (CAP) extension, suspend negotiations with Republic Services (Republic) and maintain current contract until June 30, 2027 while staff conducts Request for Proposal (RFP) for a solid waste, recycling and organics collection service provider able to comply with CAP items.
PROPOSED MOTION
Authorize City Manager, or designee, to submit revised SB 1383 CAP extension request extending deadline to December 31, 2027.
Authorize City Manager, or designee, to maintain current solid waste handling services contract until June 30, 2027 term end date and suspend ongoing contract negotiations.
Authorize City Manager, or designee, to execute RFP for new contract commencing July 1, 2027 following Republic contract expiration.
ALTERNATIVE OPTIONS
Approve Proposed Motion
Not move forward with SB 1383 CAP extension to maintain current contract with Republic while executing an RFP and new contract and continue negotiations with Republic to finalize a contract amendment aligning with October 1, 2024 CAP extension deadline Other options brought by City Council.
STAFF RECOMMENDATION
Staff recommends the proposed motion.
CITY MANAGER REMARKS
The City Manager recommends the proposed motion to the City Council which includes requesting an extension to 2027 which will allow a new contract to be in place.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statement:
Fiscal and Organizational Stability.
FISCAL IMPACT
This item does not generate General Fund impact. Refuse Fund (Fund 46) has sufficient Fiscal Year 2023-24 budget appropriation to support SB 1383 implementation costs.
Issuing an RFP and new contract could generate a competitive rate structure that complies with legislative requirements related to solid waste, recycling and organics collection.
Republic recently submitted a proposed fee schedule, however, the schedule did not respond or align to City requests. Continuing contract amendment negotiations with Republic would require new and increased fees to implement SB 1383 Short-Lived Climate Pollutant Reduction regulations.
BACKGROUND AND DISCUSSION
Governor Brown signed Senate Bill 1383 in September 2016 to reduce statewide organics waste landfill disposal by 75% and increase food recovery by 20% by 2025. The law requires jurisdictions to reduce emissions of short-lived climate pollutants and create a circular economy.
The City submitted an SB 619 Notice of Intent to Comply, after the law took effect on January 1, 2022, giving the City extended time to implement regulations without penalty. The City received an SB 619 Corrective Action Plan (CAP) in March 2023 with orders to meet 73 required tasks by March 1, 2024.The City completed 60 of the 73 tasks. Ongoing contract negotiations with Republic have delayed the remaining 13 tasks. Staff requested an extension to implement the remaining tasks beyond the March 1, 2024 with the latest January 2024 CAP report submission and awaits approval to extend the CAP to October 1, 2024.
The City discussed extending the City’s CAP until the June 30, 2027 Republic contract end date with the CalRecycle Jurisdiction and Agency Compliance and Enforcement Branch (JACE) representative on February 22, 2024 to allow time to execute an RFP and enter into a new SB 1383-compliant contract. This aligns with State objectives for the City to implement all CAP task requirements in a manner establishing successful services and programs in the City.
HF&H Consultants initiated SB 1383 contract negotiations with Republic on behalf of the City on July 6, 2021 which included a guidance document of specific City requests for the negotiations. The City attempted to finalize a complete SB 1383 amendment package (approved amendment and rates) with the hauler since that time but ultimately received unresponsive proposals that do not align with City interests despite numerous and repeated discussions, follow ups and apparent understanding of agreements.
Republic has experienced challenges over the past several years including a 2021 sanitation worker strike, a 2022 Anaheim CVT Facility fire and significant employee turnover in the Anaheim Division, from executive management to operational staff, resulting in substandard performance, lack of organizational systems, lack of recordkeeping, delayed or missed services, lack of communication and response times and delayed contract negotiations. These issues affected other surrounding cities served by the same division of Republic, including the City of Anaheim, City of Garden Grove and City of Villa Park, as documented during their City Council meetings. City staff has worked closely with Republic staff, meeting weekly and monthly to improve communications and meet current contract obligations and requirements.
Initiating a Request for Proposal (RFP) process may attract a wide range of proposals to ensure a competitive process and comparing different vendor offerings, approaches and prices. The proposals could offer new program development and progress towards meeting legislative requirements with market competitive rates. Additionally, a new proposal could offer more defined parameters and modernized contract terms not included in the current contract.
The Solid Waste and Recycling Team conducted a comparative rate analysis of all cities in Orange County in December 2023 and determined Fullerton rates for trash services fell within the top two-thirds of the residential sector and at the top of the commercial sector for the County. The last cost proposal received by Republic at the end of February contained an additional increase not previously included with no supporting calculations. An opportunity for a competitive RFP process would help City staff reevaluate market competitive rates for Fullerton ratepayers.
Moving forward to implement the programs in the current contract with Republic until the contract expires while simultaneously performing an RFP process, resulting in a new agreement, may demonstrate substantial effort to the State towards complying with the remaining requirements in a thoughtful and effective manner. The aims to comply with the law and provide services and programs at a high-level of service. cc: City Manager Eric J. Levitt
SB 1383 Compliance Action Plan
March 19, 2024 - Page 2