STAFF REPORT TO THE CITY COUNCIL
DATE: Regular Meeting of October 8, 2024
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Michael Roberts, Public Works Director/City Engineer SUBJECT: Amendment No.2 with R3 for a Not to Exceed Amount of $15K to complete the Franchise Agreement Renewal Negotiations for a Total Not to Exceed Contract Amount of $65K and an appropriation of $15K RECOMMENDED ACTION:
City Council adopt a resolution authorizing the City Manager to execute Amendment No.2 with R3 for a not to exceed amount of $15K to complete the franchise agreement renewal negotiations for a total not to exceed contract amount of $65K and appropriating $15K fund said amendment. Once negotiations for the new franchise agreement are complete, the $15K will be reimbursed to the City by Republic Services.
BACKGROUND:
The City’s solid waste collection franchise agreement with Republic Services, which was entered into in 1986, is set to expire on June 30, 2025. The initial $20K contract with R3 was expedited in August 2023 to provide timely technical support during negotiations on a renewed franchise agreement (Attachment #4). The contract was executed under the City Manager’s authority using contingency funding from the Solid Waste Fund. In October 2023 City Council approved Amendment No.1 for $30K to complete a solid waste fee study (Attachment #3) and at that time also restored the $20K in contingency funding. Negotiations with Republic Services include potential 10-, 15-, and 20- year terms as directed by City Council.
The City’s solid waste services, which include garbage, recycling, and green waste, are divided into collection and post-collection activities. Collection activities are overseen by the City whereas post-collection activities are managed by Recyclemore, a Joint Powers Authority for which the City is a member. Collection includes the curbside (or on-property) collection of solid waste material and hauling to a processing facility, such as a transfer station, recycling facility, or composting facility. The collection franchise agreement includes fees collected by the City from rate payers via Republic Services. These fees are then used to support City solid waste-related activities.
ANALYSIS:
R3 has completed a number of important milestones to date. These include the establishment of a draft restatement of the franchise agreement which is currently being negotiated line-by-line with Republic. They have completed a draft Solid Waste Fee Study, which includes a cost recovery analysis, vehicle impact analysis, and property value analysis. R3 has also been attending regular meetings with Republic and the City.
Given the detailed nature of the restatement and complexity of the negotiations with Republic, additional support from R3 is needed to complete the negotiations. The scope of this additional work includes:
Continuation of the agreement restatement negotiations, which includes a number of new deal points not anticipated in R3’s initial proposal.
Negotiation of the proposed rate adjustment associated with contract restatement.
Completing the evaluation of the proposed program enhancements.
Presenting the proposed restated franchise agreement to City Council when negotiations are complete.
FISCAL IMPACT:
The solid waste fund has adequate reserves to cover the $15K cost of the appropriation.
ATTACHMENTS:
Attach 1 - Resolution
Attach 2 – Amendment No. 2
Attach 3 – Amendment No.1 including Staff Report & Resolution Attach 4 - Base Contract