Agenda packet — Finance Committee, December 17, 2025 (part 2 of 3)

Commercial Maximum Rate Recommendation
The City allows garbage and organics containers from one to six yards collected one to six times per week. Recycling is provided as a 96-gallon container currently, but there is an intention of offering recycling bins in the future. The City sets a maximum monthly rate for a single yard collected once per week.

Commercial
Rate Effective
9/1/2024
Recommended
Rate Effective
5/1/2026
Difference
Base Rate per cubic yard $ 53.16 $ 57.09 $ 3.93
Carpenter Road Landfill ¹ $ 0.95 $ 0.95 $ -
City SB 1383 Implementation ¹ $ 1.90 $ 1.90 $ -
Compost Facility Improvements ¹ $ 3.08 $ 3.08 $ -
Geer Road Landfill ¹ $ 0.95 $ 0.95 $ -
Green Waste ¹ $ 11.04 $ 11.04 $ -
Litter Abatement ¹ $ 0.59 $ 0.59 $ -
Recycling Fees ¹ $ 0.63 $ 0.63 $ -
Fuel Adjustment $ (0.13) $ - $ 0.13
Total $ 72.17 $ 76.23 $ 4.06
¹ - City Fees
City staff analyzed the haulers’ financial reports from FY 24/25 and determined the base rate per yard per collection would increase by $4.06. The Fuel Adjustment was previously a $0.13 reduction and will be removed.

Commercial front loader compactors typically contain three times the amount of solid waste as a standard commercial bin. The maximum rates are therefore based on a multiple of three times the rate of the commercial bin maximum rate.
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Finance Committee, December 17, 2025
Restated Agreement with Bertolotti Modesto Disposal, Inc., and Annual Adjustment to Maximum Rate Schedule for Solid Waste Collection Services

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Industrial Drop Box/Roll-Off Compactors Maximum Rate Recommendation The maximum rates for industrial drop boxes and roll-off compactors are set for the pick-up charge and daily rental rate only. The actual disposal charge is negotiated directly between the solid waste company and the customer. These services are open to competition between the two authorized collection companies in the City.

Industrial
Rate Effective
9/1/2024
Recommended
Rate Effective
5/1/2026
Difference
Base Rate $ 421.10 $ 430.67 $ 9.57
Carpenter Road Landfill ¹ $ 29.77 $ 29.77 $ -
Geer Road Landfill ¹ $ 29.77 $ 29.77 $ -
Green Waste ¹ ² $ 18.55 $ 18.55 $ -
Recycling Fees ¹ $ 19.71 $ 19.71 $ -
Fuel Adjustment ³ $ - $ - N/A
Total $ 518.90 $ 528.47 $ 9.57
¹ - City Fees; ² - Industrial accounts charged by ton; ³ - Industrial accounts are charged fuel in the delivery and pickup fee
City staff analyzed the haulers’ financial reports from FY 24/25 and determined the base rate would increase by $9.57.

Under the proposed restated service agreement, the maximum solid waste rates will be adjusted annually using a multi-index adjustment that consists of Consumer Price Index, All Urban Consumers (CPI-U), and separate indices for fuel, motor vehicle maintenance and repair, and employment expenses. For years three and seven of the agreement, rates will not be adjusted by the multi-index adjustment but instead will be adjusted based on a cost-based review of the contractor’s costs. The cost-based adjustment process is intended to provide the City an opportunity to adjust Rates to more accurately reflect actual revenues and costs of operations.

Revenue collected by City fees is allocated to the following: General Fund, Solid Waste Fund, Geer Road Landfill Fund, Carpenter Road Landfill Fund, Green Waste Fund, Compost Facility Improvement Fund, Streets Fund.

Self-Haul Rate Adjustment Recommendation
Self-haul rates are being adjusted to reflect the above recommended rates for residential (cart) service and commercial (bin) service. The results are shown in the Self Haul Deposit and Annual AB939 fees. A deposit is placed in trust with the City Finance Department and held until the customer resumes solid waste services or no longer holds interest in the property for which #6..
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Finance Committee, December 17, 2025
Restated Agreement with Bertolotti Modesto Disposal, Inc., and Annual Adjustment to Maximum Rate Schedule for Solid Waste Collection Services

Page 6 of 6 ends

self-haul was established. The Annual Assembly Bill 939 Fee is distributed between Streets and General Fund.

Gilton Agreement
The City is also currently in negotiations regarding a restated service agreement with the City’s other hauler Gilton Solid Waste Management, Inc. The City has not yet been able to reach an agreement with Gilton. In the event that an agreement with Gilton is not reached, some changes to the draft agreement with Bertolotti will be necessary before City Council approval to ensure there is no conflict between the two agreements. Those potential changes will not impact the proposed maximum rates.

RECOMMENDED COMMITTEE ACTION:

Staff Recommendations:

Motion recommending a restated service agreement for solid waste collection service with Bertolotti Modesto Disposal, Inc., to become effective May 1, 2026, and forwarding to Council for approval.

Motion recommending approval of an adjustment to the Maximum Rate Schedule for City solid waste collection services provided by solid waste haulers to become effective May 1, 2026, with billing changes implemented at the new rate upon the next billing cycle, and rescinding Resolution No. 2024-290 and Resolution No. 2024-291 and forwarding to Council for approval.

Motion recommending the update to the Schedule of Cash Security Deposits and Fees for SelfHaul Residents and Businesses to become effective May 1, 2026, rescinding Resolution No. 2024-292 and forwarding to Council for approval.

Approved by:

Bill Sandhu, Director of Public Works
Joseph P. Lopez, City Manager
Attachments:

1. Restated Service Agreement

2. Service Agreement Exhibits

3. May 1, 2026, Schedule of Maximum Rates

4. Self Haul Deposit and Annual AB939 fees

5. 2001 Service Agreement (as previously amended)

6. City of Modesto 2023 Solid Waste Financial Review and Rate Analysis #6..
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SERVICE AGREEMENT EXHIBITS
EXHIBIT A:

DEFINITIONS
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-1 Service Agreement, Exhibit A
For purposes of this Agreement, unless a different meaning is clearly required, the following words and phrases shall have the following meanings respectively ascribed to them by this Exhibit and shall be capitalized throughout this Agreement:
“AB 341” means the California Jobs and Recycling Act of 2011 (Chapter 476, Statues of 2011 [Chesbro, AB 341]), also commonly referred to as “AB 341”, as amended, supplemented, superseded, and replaced from time to time.
“AB 939” means the California Integrated Waste Management Act of 1989 (Division 30 of the California Public Resources Code), also commonly referred to as "AB 939," as amended, supplemented, superseded, and replaced from time to time.
“AB 939/SB 1383 Reimbursement” means a reimbursement to the City by Contractor for expenses including, but not limited to, staffing costs related to City programs, pilot studies, education and outreach campaigns, technical assistance to Customers, reporting, compliance, capacity planning, provision of special Containers, or other activities involved in compliance with AB 939 and/or SB 1383. The City shall retain the sole right to set priorities for the use of its AB 939/SB 1383 Reimbursement. This reimbursement shall be a pass-through cost. Contractor shall pay an AB 939/SB 1383 Reimbursement to the City each month.
“AB 1201” means Assembly Bill 1201 approved by the Governor of the State of California on October 5, 2021, which amended Sections 42356, 42356.1, and 42357 of, and amended the heading of Chapter 5.7 (commencing with Section 42355) of Part 3 of Division 30 of the Public Resources Code, relating to solid waste, as amended, supplemented, superseded, and replaced from time to time. "AB 1594" means the Assembly Bill approved by the Governor of the State of California on September 28, 2014, which amended Sections 40507 and 41781.3 of the Public Resources Code, relating to solid waste, as amended, supplemented, superseded, and replaced from time to time. “AB 1826” means the Organic Waste Recycling Act of 2014 (Chapter 727, Statutes of 2014 modifying Division 30 of the California Public Resources Code), also commonly referred to as "AB 1826," as amended, supplemented, superseded, and replaced from time to time. “AB 2176” means the Venue and Event Reduction Act of 2004 (an act to amend Section 42911 of, and to add Chapter 12.7 (commencing with Section 42648) to Part 3 of Division 30 of the Public Resources Code, relating to Recycling), also commonly referred to as “AB 2176,” as amended, supplemented, superseded, and replaced from time to time.
“Acceptable Performance Level” means the minimum level of performance that Contractor must meet to avoid triggering Liquidated Damages.
“Affiliate(s)” means all businesses (including corporations, limited and general partnerships, and sole proprietorships) that are directly or indirectly related to Contractor by virtue of direct or indirect Ownership interest or common management. They shall be deemed to be "Affiliated with" Contractor and included within the term "Affiliates," as used herein. An Affiliate shall include: (i) a business in which Contractor has a direct or indirect Ownership interest; (ii) a business that has a direct or indirect #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-2 Service Agreement, Exhibit A
Ownership interest in Contractor; and/or, (iii) a business that is also Owned, controlled, or managed by any business or individual that has a direct or indirect Ownership interest in Contractor. For the purposes of this definition, “Ownership” means ownership as defined in the constructive ownership provisions of Section 318(a) of the Internal Revenue Code of 1986, as in effect on the date here, provided that ten percent (10%) shall be substituted for fifty percent (50%) in Section 318(a)(2)(C) and in Section 318(a). “Agreement” means this Agreement between the City and Contractor, including all Exhibits, and any future amendments hereto.
“Alternative Facility” means a facility approved by the City Contract Manager for use in the event that an Approved Facility is unavailable.
“Applicable Law(s)” means all Federal, State, County, and local laws, regulations, rules, orders, judgments, degrees, permits, approvals, or other requirements of any governmental agency having jurisdiction over the Collection, Transportation, and Processing of Recyclable Materials, Organic Materials, and Garbage that are in force on the Effective Date and as may be enacted, issued, or amended during the Term of this Agreement. Applicable Law includes, but is in no way limited to, AB 939, AB 341, AB 1826, and SB 1383. “Approved Disposal Facility” means the Fink Road Sanitary Landfill, located at 4000 Fink Road, Crows Landing, California 95313, which is owned and operated by Stanislaus County. The Approved Disposal Facility shall serve as the primary Disposal Facility for Garbage under this Agreement. “Approved Facility(ies)” means any one (1) of or any combination of the: (i) Approved Disposal Facility; (ii) Approved Organic Materials Processing Facility; (iii) Approved Recyclable Materials Processing Facility; and, (iv) Approved Transfer Facility, each of which are defined in this Exhibit A. “Approved Organic Materials Processing Facility” means the Modesto Compost Facility, located at 7001 Jennings Road, Modesto, CA 95358, which is owned and operated by the City of Modesto. “Approved Processing Facility(ies)” means any one (1) of or any combination of the: (i) Approved Organic Materials Processing Facility or (ii) Approved Recyclable Materials Processing Facility. “Approved Recyclable Materials Processing Facility” means the __________________ facility, located at _____________, which is owned and operated by ___________. “Approved Transfer Facility” means the __________________ facility, located at _____________, which is owned and operated by ___________.
“Bin” means a Container with capacity of approximately two (2) to six (6) cubic yards, with a hinged lid, and with wheels (where appropriate), that is serviced by a front-end loading Collection vehicle, including Bins with Compactors attached to increase the capacity of the Bin. "Bulky Item" means discarded non-Reusable Items, appliances (including refrigerators), furniture, carpets, mattresses, and similar large items that are less than eight (8) feet in length, weigh no more than five hundred (500) pounds, require special Collection due to their size or nature, can be Collected without the assistance of special loading equipment (such as forklifts or cranes) and without violating vehicle load limits, and are intended to be Disposed of in a landfill. Bulky Items must be generated by the Customer Commented [SP1]: Note: Hauler to populate
Commented [SP2]: Note: Hauler to populate
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-3 Service Agreement, Exhibit A
and at the service address where the Bulky Items are Collected. Bulky Items do not include household Garbage, glass, liquids, tires, abandoned automobiles, auto parts, trees, Construction and Demolition Debris, or items herein defined as Excluded Waste.
“Business Days” mean Days during which the City offices are open to do business with the public. “California Code of Regulations (CCR)” means the State of California Code of Regulations. CCR references in this Agreement are preceded with a number that refers to the relevant Title of the CCR (e.g., “14 CCR” refers to Title 14 of CCR).
“CalRecycle” means California's Department of Resources Recycling and Recovery. “Cardboard” means corrugated fiberboard consisting of a fluted corrugated sheet and one (1) or two (2) flat linerboards, as is often used in the manufacture of shipping containers and corrugated boxes.

Cardboard is a subset of Recyclable Materials.
“Cart” means a plastic Container with a hinged lid and wheels that is serviced by an automated or semiautomated Collection vehicle. A Cart has capacity of sixty-four (64) or ninety-six (96) gallons (or similar volumes).
“Change in Law” means any of the following events or conditions that have a material and adverse effect on the performance by the Parties of their respective obligations under this Agreement (except for payment obligations):

A. The enactment, adoption, promulgation, issuance, modification, or written change in administrative or judicial interpretation of any Applicable Law on or after the Effective Date.

B. The order or judgment of any governmental body, on or after the Effective Date, to the extent such order or judgment is not the result of willful or negligent action, error or omission, or lack of reasonable diligence of the City or Contractor, whichever is asserting the occurrence of a Change in Law; provided, however, that contesting in good faith or the failure in good faith to contest any such order or judgment shall not constitute or be construed as such a willful or negligent action, error or omission, or lack of reasonable diligence.
“City” means the City of Modesto and all the territory within its boundaries as presently existing or as such boundaries may be modified during the Term of this Agreement. "City Contract Manager" means the Person, or their designee, designated by the City to administer and monitor the provisions of this Agreement, as designated in Section 5.9. “City Reimbursements” means all amounts payable to the City, identified and referenced in Article 7 of this Agreement.
“Collect” or “Collection” (or any variation thereof) means the act of taking possession of Recyclable Materials, Organic Materials, Garbage, Bulky Items, and other material at the place of generation in the City.
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-4 Service Agreement, Exhibit A
“Commencement Date” means the date specified in Section 2.1 when Collection, Transportation, and Processing services required by this Agreement shall be provided. “Commercial” means of, from, or pertaining to non-Residential Premises where business activity is conducted, including, but not limited to, retail sales, services, wholesale operations, manufacturing, and industrial operations, excluding businesses conducted upon Residential property that are permitted under applicable zoning regulations and such business is not the primary use of the property. “Commercial Edible Food Generator” includes Tier One Commercial Edible Food Generators and Tier Two Commercial Edible Food Generators, or as otherwise defined in 14 CCR Section 18982(a)(7). For the purposes of this definition, Food Recovery Organizations and Food Recovery Services are not Commercial Edible Food Generators.
"Commercial Premises" means Premises upon which business activity is conducted, including, but not limited to, retail sales, services, wholesale operations, and manufacturing and industrial operations, excluding Residential Premises upon which business activities are conducted, when such activities are permitted under applicable zoning regulations and are not the primary use of the property. Commercial Premises include Multi-Family Premises.
“Compactor” means: (i) a mechanical apparatus that compresses materials together, including the Container that holds the compressed materials; or, (ii) if it is detached from the mechanical compaction apparatus, the Container that holds the compressed materials. Compactors include two (2) to eight (8) cubic yard Bin Compactors serviced by front-end loader Collection vehicles and ten (10) to fifty (50) cubic yard Roll-Off Box Compactors serviced by roll-off Collection vehicles. “Complaint” shall mean each written or orally communicated statement made by any Person, whether to the City or Contractor, alleging: (i) non-performance or deficiencies in Contractor’s performance in its duties under this Agreement; (ii) a violation by Contractor of this Agreement; or, (iii) an SB 1383 noncompliance Complaint. “Compost or “Composting” (or any variation thereof) means the method of treatment in which Organic Materials are biologically decomposed under controlled aerobic conditions to produce a safe and nuisance-free Compost Product.
“Compostable Plastic(s)” means plastic materials that meet the ASTM D6400 standard for Compostability.

Compostable Plastics are a subset of Food Waste.
“Compost Product” means the product resulting from the controlled biological decomposition of Organic Materials that are Source Separated from Garbage, or are separated at a centralized composting facility and have met the standards outlined in 14 CCR Sections 17868.1 through 17868.5. “Construction and Demolition (C&D) Debris” includes discarded building materials, packaging, debris, and rubble resulting from construction, alteration, remodeling, repair, or demolition operations on any pavements, excavation projects, houses, Commercial buildings, or other structures, excluding Excluded Waste. Construction and Demolition Debris includes rocks, soils, tree remains, and other Yard Trimmings that result from land clearing or land development operations in preparation for construction. #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-5 Service Agreement, Exhibit A
“Container(s)” mean Bins, Carts, Compactors, and Roll-Off Boxes; provided, however, that Contractor shall not be required to provide Compactors to Customers, but shall be required to provide Collection service to Customer-provided Compactors if such Customer-provided Compactors are compatible with Contractor’s existing Collection equipment and processes. “Contractor” means Bertolotti Modesto Disposal, Inc., organized and operating under the laws of the State and its officers, directors, employees, agents, companies, related parties, Affiliates, subsidiaries, and Subcontractors.
“Contractor’s Compensation” means the monetary compensation received by Contractor in return for providing services in accordance with this Agreement, as described in Article 8. “Contractor’s Contract Manager” means an employee of Contractor who is responsible for working closely with the City Contract Manager in the monitoring and administration of this Agreement.

Contractor’s Contract Manager shall not be involved in the management, operations, administration, marketing, or other activities of Contractor other than under this Agreement and up to one (1) other community’s service or franchise agreements.
“Control” means the power to direct or cause the direction of the management or operations of another, either directly or indirectly.
“County” means the County of Stanislaus, a political subdivision of the State of California. “CPI-U” means the Consumer Price Index, All Urban Consumers, all items, not seasonally adjusted, San Francisco-Oakland-Hayward Metropolitan Area, compiled and published by the U.S. Department of Labor, Bureau of Labor Statistics.
“Curb” or “Curbside” (or any variation thereof) means the cornered edging between the street and sidewalk. Curb or Curbside also means and describes the location of a Collection Container for pick up, where such Container is placed on the street or alley against the face of the Curb, or, if no Curb exists, not more than five (5) feet from the outside edge of the street or alley nearest the property’s entrance. “Customer” means the Person receiving Residential or Commercial Collection services for Discarded Materials Generated on Premises located in the Service Area from Contractor. The Customer may be the Occupant, Owner, or manager of the Premises.
“Customer Account Information Database” means the Customer Account Information Database, as identified in Section 4.11, that shall be developed, maintained, and monitored in accordance with the requirements of this Agreement.
“Customer Type” means the Customer’s sector category, including, but not limited to, Single-Family, Multi-Family, Commercial, Roll-Off Box, special events, and the City. “Days” means calendar days, including Saturdays, Sundays, and Holidays, except as otherwise specifically provided herein.
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-6 Service Agreement, Exhibit A
“Designated Waste” means non-Hazardous Waste that may pose special Disposal problems because of its potential to contaminate the environment and may be Disposed of only in Class II Disposal sites or Class III Disposal sites, pursuant to a variance issued by the California Department of Health Services.

Designated Waste consists of those substances classified as Designated Waste by the State in California Code of Regulations Title 23, Section 2522.
“Disabled Person” or “Disability” (or any variation thereof) means a Person who is considered disabled, as defined in 2 CCR Section 11065(d) of California State Law. “Discarded Materials” means any waste materials (other than Excluded Waste) produced by Generators that are no longer of use to the Generator and have become the subject of regulation. Discarded Materials may become Discarded Materials if the Generator Source Separated the Discarded Materials into one (1) or more type(s) of Discarded Materials.
“Dispose” or “Disposal” (or any variation thereof) means the final disposition of Garbage or Processing Residue at a Disposal Facility.
“Disposal Facility” means a landfill, or other facility for Disposal of Garbage. “Divert” or “Diversion” (or any variation thereof) means to prevent Discarded Materials from Disposal at landfill or transformation facilities (including facilities using incineration, pyrolysis, distillation, gasification, or biological conversion methods) through source reduction, reuse, repair, Recycling, Composting, anaerobic digestion, or other method of Processing, subsequent to the provisions of AB 939.

Diversion is a broad concept that is inclusive of material handling and Processing changes that may occur over the Term, including, but not limited to, changes in standard industry practice or implementation of innovative (but not necessarily fully proven) techniques or technologies that reduce Disposal risk, decrease costs, and/or are, for other reasons, deemed desirable by the City. “Diversion Rate” means the percentage equal to the Tonnage Diverted by Contractor divided by the Tonnage Collected by Contractor multiplied by one hundred (100), which reflects the accomplishments of Contractor’s Diversion programs.
“Dwelling Unit” means any individual living unit in a Single-Family or Multi-Family structure or building, a mobile home, or a motor home located on a permanent site intended for, or capable of being utilized for, Residential living, other than a hotel or motel.
“Edible Food” means food intended for human consumption. For the purposes of this Agreement, Edible Food is not Garbage if it is recovered and not discarded. Nothing in this Agreement requires or authorizes the recovery of Edible Food that does not meet the food safety requirements of the California Retail Food Code. If the definition in 14 CCR Section 18982(a)(18) for Edible Food differs from this definition, the definition in 14 CCR Section 18982(a)(18) shall apply to this Agreement. “Effective Date” means the date on which the latter of the two (2) Parties signs this Agreement. “Enclosure” means a designated area for the storing of Recyclable Materials, Organic Materials, or Garbage, sized appropriately to handle Containers necessary for the expected volume of Discarded #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-7 Service Agreement, Exhibit A
Materials generated at the Premises, and maintained in compliance with all Applicable Laws and regulations.
“Excluded Waste” means Hazardous Substances; Hazardous Waste; Infectious Waste; Designated Waste; corrosive, biomedical, biohazardous, and toxic substances or material, and toxic substances or material; waste that Contractor reasonably believes would, as a result of or upon Disposal, be a violation of local, State, or Federal law, regulation, or ordinance, including land use restrictions or conditions; waste that cannot be Disposed of in Class III landfills; or waste that, in Contractor’s reasonable opinion, would present a significant risk to human health or the environment, cause a nuisance, or otherwise create or expose Contractor or the City to potential liability. Excluded Waste does not include de minimis volumes or concentrations of waste of a type and amount normally found in Residential Garbage after implementation of programs for the safe Collection, Recycling, treatment, and Disposal of batteries and paint in compliance with Sections 41500 and 41802 of the California Public Resources Code or Household Batteries when properly placed for Collection by Customer as set forth in this Agreement. “Extended Producer Responsibility Program” means an environmental program or policy codified, enforced, and/or monitored by local, State, or Federal governments in which a producer’s, distributor’s, or retailer’s administrative, financial, operational, and/or physical responsibility for a product is extended to the post-consumer stage of the product’s life cycle. Extended Producer Responsibility Programs may be implemented by individual producers, collective industry organizations, such as a producer responsibility organization or Stewardship Organization, or other regulated entities specified under the program. Such programs may cover individual products or categories of products, using one (1) or more funding mechanisms, as defined in the regulation(s) establishing the program. “Federal” means belonging to or pertaining to the Federal government of the United States. “Flow Control” means the City right to direct Discarded Materials to a facility of the City’s choosing. “Food Recovery” means actions to Collect and distribute food for human consumption that otherwise would be Disposed, or as otherwise defined in 14 CCR Section 18982(a)(24). “Food Recovery Organization” means an entity that primarily engages in the Collection or receipt of Edible Food from Commercial Edible Food Generators and distributes that Edible Food to the public for Food Recovery, either directly or through other entities, including, but not limited to:

A. A food bank, as defined in Section 113783 of the Health and Safety Code.

B. A nonprofit charitable organization, as defined in Section 113841 of the Health and Safety code.

C. A nonprofit charitable temporary food facility, as defined in Section 113842 of the Health and Safety Code.

D. A Commercial business or entrepreneur that generates added value to recovered food.

If the definition in 14 CCR Section 18982(a)(25) for Food Recovery Organization differs from this definition, the definition in 14 CCR Section 18982(a)(25) shall apply to this Agreement. #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-8 Service Agreement, Exhibit A
“Food Recovery Service” means a Person or entity that Collects and Transports Edible Food from a Commercial Edible Food Generator to a Food Recovery Organization or other entities for Food Recovery; or as otherwise defined in 14 CCR Section 18982(a)(26). “Food Scraps" means those Discarded Materials that will decompose and/or putrefy, including: (i) all kitchen and table food waste; (ii) animal or vegetable waste that is generated during or results from the storage, preparation, cooking, or handling of food stuffs; (iii) fruit waste, grain waste, dairy waste, meat waste, and fish waste; and, (iv) vegetable trimmings, houseplant trimmings, and other Compostable Organic Waste common to the occupancy of Residential dwellings. Food Scraps are a subset of Food Waste.
“Food-Soiled Paper” means Compostable paper material that has come in contact with Food Scraps or liquid, such as, but not limited to, Compostable paper plates, paper liners, paper coffee cups, napkins, pizza boxes, and milk cartons. Food-Soiled Paper is a subset of Food Waste. “Food Waste” means Source Separated Food Scraps, Food-Soiled Paper, and Compostable Plastics. Food Waste is a subset of Organic Materials.
“Franchise Fee” means the fee paid by Contractor to the City, as described in Section 7.1. “Garbage” means solid waste, as defined in California Public Resources Code, Division 30, Part 1, Chapter 2, §40191 and regulations promulgated hereunder. Excluded from the definition of Garbage are Excluded Waste, C&D Debris, Source Separated Recyclable Materials, Source Separated Organic Materials, and radioactive waste. Notwithstanding any provision to the contrary, Garbage may include de minimis volumes or concentrations of waste of a type and amount normally found in Residential Garbage after implementation of programs for the safe Collection, Recycling, treatment, and Disposal of Household Hazardous Waste, in compliance with Section 41500 and 41802 of the California Public Resources Code, as may be amended from time to time. Garbage includes salvageable materials only when such materials are included for Collection in a Garbage Container and not Source Separated from Garbage at the site of generation.
“Generator” means any Person whose act or process produces Discarded Materials, as defined in the Public Resources Code, or whose act first causes Discarded Materials to become subject to regulation. “Gross Receipts” shall mean total cash receipts collected from Customers by Contractor for the provision of services pursuant to this Agreement, without any deductions. Gross Receipts do not include revenues from the sale of Recyclable Materials.
“Hazardous Substance” means any of the following:

A. Any substances defined, regulated, or listed (directly or by reference) as “Hazardous Substances,” “hazardous materials,” “Hazardous Wastes,” “toxic wastes,” “pollutants,” or “toxic substances,” or similarly identified as hazardous to human health or the environment, in or pursuant to: (i) CERCLA, 42 U.S.C. § 9601 et seq.; (ii) the Hazardous Materials Transportation Act, 49 U.S.C. § 1802 et seq.; (iii) the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq.; (iv) the Clean Water Act, #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-9 Service Agreement, Exhibit A
33 U.S.C. § 1251 et seq.; (v) the Clean Air Act, 42 U.S.C. § 7401 et seq.; (vi) California Health and Safety Code Sections 25115, 25117, and 25281; or, (vii) California Water Code Section 13050.

B. Any amendments, rules, or regulations promulgated thereunder to such enumerated statues or acts currently existing or hereafter enacted.

C. Any other hazardous or toxic substance, material, chemical, waste, or pollutant identified as hazardous or toxic or regulated under any other applicable Federal, State, or local environmental laws currently existing or hereinafter enacted, including, without limitation, friable asbestos, polychlorinated biphenyls, petroleum, natural gas and synthetic fuel products, and byproducts. “Hazardous Waste” means all substances defined as hazardous waste, acutely hazardous waste, or extremely hazardous waste by the State in Health and Safety Code §25110.02, §25115, and §25117, including the future amendments to or recodifications of such statutes, or identified and listed as Hazardous Waste by the U.S. Environmental Protection Agency (EPA), pursuant to the Federal Resource Conservation and Recovery Act (42 USC §6901 et seq.), all future amendments thereto, and all rules and regulations promulgated thereunder.
“Holidays” are defined as New Year's Day, Independence Day, Thanksgiving Day, and Christmas Day. “Household Hazardous Waste” or “HHW” means Hazardous Waste generated at Residential Premises within the City. HHW includes: paint; stain; varnish; thinner; adhesives; auto products, such as old fuel, Used Motor Oil and Filters; batteries; household batteries; fluorescent bulbs; tubes; cleaners and sprays; pesticides; fertilizers and other garden products; needles; syringes; and lancets. “Infectious Waste” means biomedical waste generated at hospitals, public or private medical clinics, dental offices, research laboratories, pharmaceutical industries, blood banks, mortuaries, veterinary facilities, and other similar establishments that are identified in Health and Safety Code Section 25117.5, as may be amended from time to time.
“Liquidated Damages” means the amounts agreed upon by Contractor and the City as fair and reasonable damages for Contractor’s failure to meet specific quantifiable standards of performance, as described in Section 10.5 and Exhibit F.
“Mulch” means a layer of material applied on top of soil. For the purposes of this Agreement, Mulch shall conform with the following conditions, or as otherwise specified in 14 CCR Section 18993.1(f)(4):

A. Meets or exceeds the physical contamination, maximum metal concentration, and pathogen density standards for land applications specified in 14 CCR Section 17852(a)(24.5)(A)(1) through (3).

B. Was produced at one (1) or more of the following types of facilities:

1. A compostable material handling operation or facility, as defined in 14 CCR Section 17852(a)(12), that is permitted or authorized under Division 7 of Title 14 of the CCR, other than a chipping and grinding operation or facility, as defined in 14 CCR Section 17852(a)(10.

Note that this criteria disallows Mulch produced from chipping and grinding operations to count toward fulfillment of a jurisdiction’s annual Organic Waste product procurement target. #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-10 Service Agreement, Exhibit A

2. A transfer/processing facility or transfer/processing operation, as defined in 14 CCR Section 17402(a)(30) and (31), respectively, that is permitted or authorized under 14 CCR, Division 7, Chapter 12.
“Multi-Family” means of, from, or pertaining to Residential Premises with five (5) or more Dwelling Units.

Multi-Family Premises do not include hotels, motels, or other transient occupancy facilities, which are considered Commercial Businesses.
“Multi-Family Dwelling Unit” means an individual Residential unit of a Multi-Family complex. “Occupant” means the Person who occupies a Premises.
“Organic Materials” means Yard Trimmings and Food Waste, individually or collectively. No Discarded Material shall be considered to be Organic Materials, unless it is separated from Recyclable Materials and Garbage. Organic Materials are a subset of Organic Waste. “Organic Waste” means wastes containing material originated from living organisms and their metabolic waste products, including, but not limited to, food, Yard Trimmings, Cardboard, newspaper (including inserts, coupons, and store advertisements); mixed paper (including office paper, computer paper, magazines, junk mail, catalogs, brown paper bags, brown paper, paperboard, paper egg cartons, telephone books, paper grocery bags, colored paper, construction paper, envelopes, legal pad backings, shoe boxes, tabletop beverage containers, cereal and other similar food boxes), manure, biosolids, digestate, and sludges, or as otherwise defined in 14 CCR Section 18982(a)(46). Biosolids and digestate are as defined in 14 CCR Section 18982(a)(4) and 14 CCR Section 18982(a)(16.5), respectively. “Owner” means the Person(s) holding legal title to real property and/or any improvements thereon and shall include the Person(s) listed on the latest equalized assessment roll of the County Assessor. “Party” or “Parties” refers to the City and Contractor, individually or together. “Person(s)” means any individual, firm, association, organization, partnership, consortium, corporation, trust, joint venture, Commercial entity, governmental entity, public entity, or any other legal Person. “Premises” means any land or building in the City where Recyclable Materials, Organic Materials, or Garbage are generated or accumulated.
“Primary Responsible Party” means the party designated as primarily responsible for Single-Family, MultiFamily, or Commercial shared service, as further described in Exhibit B2.6 and Exhibit B3.4. The Primary Responsible Party will serve as the singular point of contact for communication and billing from Contractor and the City, along with a list of all addresses with which the Primary Responsible Party will share service. “Pre-Processing Facility” means a permitted facility that receives Recyclable Materials, Organic Materials, or Reusable Materials and performs one (1) or more preliminary Processing steps to remove contaminants and/or prepare the materials for further Processing.
“Processing” means the controlled separation, recovery, volume reduction, conversion, or Recycling of Recyclable Materials, Organic Materials, or Garbage, including, but not limited to, organized, manual, #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-11 Service Agreement, Exhibit A automated, or mechanical sorting; the use of vehicles for spreading of waste for the purpose of recovery; and/or the use of conveyor belts, sorting lines, or volume reduction equipment, or as otherwise defined in 14 CCR Section 17402(a)(20).
“Processing Facility” a permitted facility in which materials are sorted, separated, or otherwise manipulated for the purposes of Recovering marketable commodities. “Prohibited Container Contaminants” means the following: (i) Discarded Materials placed in the Recyclable Materials Container that are not identified as acceptable Recyclable Materials for the City’s Collection program; (ii) Discarded Materials placed in the Organic Materials Container that are not identified as acceptable Organic Materials for the City’s Collection program; (iii) Discarded Materials placed in the Garbage Container that are acceptable Recyclable Materials and/or Organic Materials to be placed in the City’s Recyclable Materials or Organic Materials Containers or as otherwise managed under the City’s Collection program; and, (iv) Excluded Waste placed in any Container. “Proprietary” or “Proprietary Information” means that information provided by Contractor to the City that is protected from disclosure by the California Public Records Act and meets that definition of proprietary information. Nothing required to be submitted to the City in any report described in this Agreement shall be considered Proprietary. Contractor’s Customer lists for Customers served under this Agreement are specifically not considered Proprietary for the purposes of this Agreement; however, the City may protect such information from disclosure consistent with the provisions of the Public Records Act.
“Public Education Reimbursement” means the fee paid from Contractor to the City to reimburse the City for the cost of providing public outreach and educational programs, as described in Section 7.3 of the Agreement.
“Public Right-of-Way” means all City-owned and maintained areas, whether improved or unimproved, that are designated for public use or access, including Public Streets, alleys, sidewalks, utility corridors, easements, and any other public land or space for public use or access. “Public Street” means all City-owned and maintained paved areas between the normal Curb line of a roadway, including public parking lots, roadway dividers, and medians. “Rate” means the maximum amount, expressed as a dollar unit, approved by the City that Contractor may bill a Customer for providing services under this Agreement. A Rate has been established for each individual Service Level and the initial Rates for Rate Period One are presented in Exhibit G2. The Rates approved by the City are the maximum Rate that Contractor may charge a Customer. Contractor may, in its sole discretion, charge any amount up to and including the maximum Rate approved by the City. “Rate Period” means a twelve (12) month period, commencing July 1 and concluding June 30, with the exception that Rate Period One shall begin on the Commencement Date, and end June 30, 2027 (i.e., a seventeen- (17-) month period).
“Recyclable Materials” means those Discarded Materials that the Generators set out in Recyclable Materials Containers for Collection for the purpose of Recycling by Contractor, excluding Excluded Waste.

Commented [SP3]: Note: Update RP1 dates, upon
establishment of commencement date.
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-12 Service Agreement, Exhibit A No Discarded Materials shall be considered Recyclable Materials unless such material is separated from Organic Materials and Garbage. Recyclable Materials shall include, but not be limited to: chipboard; corrugated clean Cardboard; glass containers of any color (including brown, clear, and green glass bottles and jars); aluminum (including beverage containers and small pieces of scrap metal); steel, tin or bi-metal cans; mixed plastics, such as plastic containers (no. 1 to 7), except expanded Polystyrene (EPS); bottles, including containers made of HDPE, LDPE, or PET. Contractor shall not add or subtract materials to or from this list without approval from the City.
“Recycle” or “Recycling” means the process of sorting, cleansing, treating, and reconstituting materials that would otherwise be Disposed of at a landfill at a Recyclable Materials Processing Facility for the purpose of returning such materials to the economy in the form of raw materials for new, reused, or reconstituted products. Recycling includes processes deemed to constitute a reduction of landfill Disposal, pursuant to 14 CCR, Division 7, Chapter 12, Article 2. Recycling does not include gasification or transformation, as defined in Public Resources Code Section 40201. “Renewable Natural Gas” or “RNG” means gas derived from Organic Waste that has been Diverted from a landfill and Processed at an in-vessel digestion facility that is permitted or otherwise authorized by 14 CCR to recover Organic Waste, or as otherwise defined in 14 CCR Section 18982(a)(62). “Residential” shall mean of, from, or pertaining to Single-Family Premises and Multi-Family Premises, including homes, apartments, condominiums, townhouse complexes, mobile home parks, and cooperative apartments.
“Residue” means materials that remain after Processing, Pre-Processing, and/or Composting that cannot be Diverted and require Disposal.
“Reusable Materials Hierarchy” means, as defined by the Federal Environmental Protection Agency, the ranking of various waste management strategies from most to least environmentally preferred: source reduction and reuse, Recycling and Composting, energy recovery, and treatment and Disposal. "Roll-Off Box" means a metal Container with a capacity of (10) or more cubic yards that is normally loaded onto a motor vehicle and Transported to an appropriate Approved Facility. "Roll-Out Service" means a service provided to Multi-Family Dwellings and Commercial Premises during which Contractor's driver must dismount the Collection vehicle and move one (1) or more Bins in order to accomplish Collection using the standard Collection vehicle. “SB 54” means Senate Bill 54, the Plastic Pollution Prevention and Packaging Producer Responsibility Act approved by the Governor of the State of California on June 30, 2022, which amended Section 41821.5 of the California Public Resources Code to add Chapter 3 (commencing with Section 42040) to Part 3 of Division 30, as amended, supplemented, superseded, and replaced from time to time. For the purposes of this Agreement, SB 54 includes any implementing regulations developed by CalRecycle, as amended supplemented, superseded, and replaced from time to time. “SB 1016” means Senate Bill 1016 approved by the Governor of the State of California on September 26, 2008, which amended Sections 40183, 40184, 41783, 41820.6, 41821, 41850, 42921, and 42926 of, #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-13 Service Agreement, Exhibit A amended the headings of Article 4 (commencing with Section 41825) and Article 5 (commencing with Section 41850) of Chapter 7 of Part 2 of Division 30 of, added Sections 40127, 40145, 40150.1, 41780.05, 42921.5, and 42927 to, and repealed and added Section 41825 of, the Public Resources Code, relating to solid waste, as amended, supplemented, superseded, and replaced from time to time. “SB 1383” means Senate Bill 1383 of 2016 approved by the Governor on September 19, 2016, which added Sections 39730.5, 39730.6, 39730.7, and 39730.8 to the Health and Safety Code, and added Chapter 13.1 (commencing with Section 42652) to Part 3 of Division 30 of the Public Resources Code, establishing methane emissions reduction targets in a Statewide effort to reduce emissions of short-lived climate pollutants, as amended, supplemented, superseded, and replaced from time to time. For the purposes of this Agreement, SB 1383 specifically refers to the Short-Lived Climate Pollutants (SLCP): Organic Waste Reductions regulations developed by CalRecycle and adopted on November 3, 2020 that created Chapter 12 of 14 CCR, Division 7 and amended portions of regulations of 14 CCR and 27 CCR. “Self-Hauler” or “Self-Haul” means a Person who hauls Discarded Materials or any other material (other than Excluded Waste) the hauler has Generated, solely in or on their own Premises, using their own equipment and employees, to another Person, or as otherwise defined in 14 CCR Section 18982(a)(66).

Self-Hauler also includes a Person who backhauls waste, as defined in 14 CCR Section 18982(a)(66)(A), such as gardeners and landscapers.
“Service Area” means the geographic area where Contractor is authorized and obligated to provide Collection and related services under this Agreement, as delineated on the map in Exhibit J: Service Area Map.
“Service Level” means the size of a Customer’s Container(s) and the frequency of Collection service. “Service Opportunity” means each individual scheduled opportunity Contractor has to Collect from a Container at a Customer’s location. For example, a Commercial Customer receiving Recyclable Materials Collection service two (2) times per week for two (2) Recyclable Materials Containers, Organic Materials Collection service two (2) times per week for (2) Organic Materials Containers, and Garbage Collection service two (2) times per week for two (2) Garbage Containers would have a total of twelve (12) Service Opportunities each week. Service Opportunities shall be calculated based on the subscription levels presented in Contractor’s most recently completed monthly report to the City. “Sharps Waste” means hypodermic needles, pen needles, intravenous needles, lancets, and other devices that are used to penetrate the skin for the delivery of medications and are generated from use at Residential Premises.
“Single-Family” means of, from, or pertaining to any Residential Premises with fewer than five (5) units. “Source Separated” means the segregation, by the Generator, of materials designated for separate Collection for some form of Recycling, Composting, recovery, or reuse. “State” means the State of California.
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-14 Service Agreement, Exhibit A “Stewardship Organization” means a Person(s) that is selected by the City and approved or designated under Applicable Law or by a relevant governing body, including, but not limited to, CalRecycle, the California Air Resources Board (CARB), the County, or the City to manage, coordinate, fund, or otherwise oversee one (1) or more Extended Producer Responsibility Programs. The applicable Stewardship Organization for each Extended Producer Responsibility Program under this Agreement shall be designated or approved by the City Contract Manager, at their sole discretion. “Subcontractor” means a Party who has entered into a contract, express or implied, with Contractor for the performance of an act that is necessary for Contractor’s fulfillment of its obligations for providing service under this Agreement. Vendors providing materials and supplies to Contractor shall not be considered Subcontractors.
“Term” means the Term of this Agreement, including extension periods if granted, as provided for in Article 2.
“Ton” or “Tonnage” means a unit of measure for weight equivalent to two thousand (2,000) standard pounds where each pound contains sixteen (16) ounces.
“Trade Secrets” means information, including a formula, pattern, compilation, program, device, method, technique, or process, that: (i) derives actual independent economic value from not being generally known to the public or other Persons who can obtain economic value from its disclosure or use; and, (ii) is the subject of efforts, that are reasonable under the circumstances, to maintain its secrecy. “Transfer” means the act of transferring the materials Collected by Contractor in its route vehicles into larger vehicles for Transport to other facilities for the purpose of Recycling or Disposing of such materials. “Transport” or “Transportation” means the act of conveying Collected materials from one (1) location to another.
“Used Motor Oil and Filter” means motor oil and the subsequent oil filter that has been used in a vehicle. “Waste Generation and Characterization Reimbursement” means the fee paid from Contractor to the City to perform waste generation and characterization studies, as detailed in Section 4.14 of the Agreement.
“Working Day(s)” means Days on which Contractor is required to provide regularly scheduled Collection services under this Agreement.
“Yard Trimmings” means those Discarded Materials that will decompose and/or putrefy, including, but not limited to, green trimmings, grass, weeds, leaves, prunings, branches, dead plants, brush, tree trimmings, dead trees, small pieces of unpainted and untreated wood, and other types of Organic Materials resulting from normal yard and landscaping maintenance that may be specified in City Legislation for Collection and Processing as Organic Materials under this Agreement. Yard Trimmings placed for Collection may not exceed six (6) inches in diameter and three (3) feet in length and must fit within the Contractor-provided Container. Yard Trimmings do not include items herein defined as Excluded Waste. Yard Trimmings are a subset of Organic Materials. #6..
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EXHIBIT A

DEFINITIONS
January 27, 2026 Page A-15 Service Agreement, Exhibit A #6..
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EXHIBIT B:

DIRECT SERVICES
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EXHIBIT B

DIRECT SERVICES
January 27, 2026 Page B-1 Service Agreement, Exhibit B
The following Exhibits (B1 through B4) describe the programs which, in aggregate, represent the direct services to be performed under this Agreement by Contractor and the programs to be provided to each Customer Type by Contractor. Contractor shall provide such services in accordance with each program’s specific requirements, which may include:
 Type and size of Containers or Service Level to be offered by Contractor under each program.  Frequency of service to be offered by Contractor to Customers.  Location of service, including an indication of whether or not additional charges may apply if a Customer selects a location that is more costly to serve.  Materials that are acceptable or prohibited within the program.  Provision of additional services to the Customer if the standard Service Levels are inadequate, either on a regular or periodic basis, and an indication of whether or not additional charges may apply.  Other requirements and considerations of the program. #6..
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EXHIBIT B1:

SINGLE-FAMILY RESIDENTIAL SERVICES
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EXHIBIT B1

SINGLE-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B1-1 Service Agreement, Exhibit B1

1. Recyclable Materials Collection
Contractor shall Collect Recyclable Materials placed in Contractor-provided Containers one (1) time every other week from Single-Family Customers and Transport all Recyclable Materials to the Approved Recyclable Materials Processing Facility for Processing.

Containers: Carts
Container Sizes: 96-gallon Carts (or comparable size approved by the City).

Service Frequency: Every other week on the same Day as Organic Materials and Garbage Collection services, as determined by even or odd numbered addresses.

Service Location: Curbside
Acceptable Materials: Recyclable Materials
Prohibited Container Contaminants: Garbage, Organic Materials, Excluded Waste Additional Service: Single-Family Customers shall receive one (1) standard Recyclable Materials Cart.

Contractor shall provide additional Recyclable Materials Carts to Single-Family Customers upon request and may charge the appropriate Rate approved by the City.

Contractor may refuse to Collect a Recyclable Materials Container that contains any presence of Prohibited Container Contaminants, provided that Contractor leaves a non-Collection notice in accordance with Subsection 5.3.B of this Agreement. Contractor shall instruct the Customer to either remove the Prohibited Container Contaminants or pay the City-approved Rate to have the contents of the contaminated Recyclable Materials Container Collected as Garbage. Contractor may charge the Customer the City-approved Rate for a special pick-up if the Customer elects to have their corrected or contaminated Recyclable Materials Container serviced before the next regular Collection Day.

Contractor shall keep a record of all non-Collection notices and courtesy notices issued to Customers, which shall include, at a minimum: the date, Customer address, Customer account number, Customer phone number, and material type of the Container in question.

2. Organic Materials Collection
Contractor shall Collect Organic Materials placed in Contractor-provided Carts one (1) time per week from Single-Family Customers and Transport all Organic Materials to the Approved Organic Materials Processing Facility for Processing.

Containers: Carts
Container Sizes: 96-gallons (or comparable size approved by the City).

Service Frequency: One (1) time per week on the same Day as Garbage Collection service. #6..
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EXHIBIT B1

SINGLE-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B1-2 Service Agreement, Exhibit B1 Service Location: Curbside
Acceptable Materials: Organic Materials
Prohibited Container Contaminants: Recyclable Materials, Garbage, Excluded Waste Additional Service: Single-Family Customers shall receive one (1) standard Organic Materials Cart.

Contractor shall provide additional Organic Materials Carts to Single-Family Customers upon request and may charge the appropriate Rate approved by the City.

Other Requirements: Contractor shall allow Single-Family Customers to place Organic Materials in Compostable Plastic bags prior to placing Organic Materials into their Organic Materials Carts for Collection, as directed by the City. If bagging their Organic Materials, Customers must use Compostable Plastic bags labeled as “Compostable” by the manufacturer that meet the ASTM D6400 standard for Compostability.

Contractor may refuse to Collect an Organic Materials Container that contains any presence of Prohibited Container Contaminants, provided that Contractor leaves a non-Collection notice in accordance with Subsection 5.3.B of this Agreement. Contractor shall instruct the Customer to either remove the Prohibited Container Contaminants or pay the City-approved Rate to have the contents of the contaminated Organic Materials Container Collected as Garbage.

Contractor may charge the Customer the City-approved Rate for a special pick-up if the Customer elects to have their corrected or contaminated Organic Materials Container serviced before the next regular Collection Day. Contractor shall keep a record of all non-Collection notices and courtesy notices issued to Customers, which shall include, at a minimum: the date, Customer address, Customer account number, Customer phone number, and material type of the Container in question.

3. Garbage Collection
Contractor shall Collect Garbage placed in Contractor-provided Carts one (1) time per week from SingleFamily Customers and Transport all Garbage to the Approved Disposal Facility for Disposal.

Containers: Carts
Container Sizes: 64- and 96-gallons (or comparable sizes approved by the City). Default Container size is 96-gallon.

Service Frequency: One (1) time per week on the same Day as Organic Materials Collection service.

Service Location: Curbside
Acceptable Materials: Garbage
Prohibited Container Contaminants: Recyclable Materials, Organic Materials, Excluded Waste #6..
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EXHIBIT B1

SINGLE-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B1-3 Service Agreement, Exhibit B1 Additional Service: Single-Family Customers shall receive one (1) standard Garbage Cart. Contractor shall provide additional Garbage Carts to Single-Family Customers upon request and shall charge the appropriate Rate approved by the City.

Other Requirements: None

4. Bulky Item Collection Program
Contractor shall Collect Bulky Items from Single-Family Customers or provide vouchers for delivery of Bulky Items by Customers to the Approved Transfer Facility. In the event a question arises as to whether a specific item or category of items meets the definition of Bulky Item, the City Contract Manager will make the final determination. Contractor shall Transport all Collected Bulky Items to the appropriate Approved Facility for reuse, repair, Processing, or Disposal based on the Reusable Materials Hierarchy.

A. Bulky Item Collection
Containers: Not applicable
Service Level: Upon Customer or Occupant request. Items shall not exceed eight (8) feet in length or five hundred (500) pounds.

Service Frequency: Two (2) times per year
Service Location: Curbside
Acceptable Materials: Bulky Items
Prohibited Items: Household Garbage, Food Scraps, Yard Trimmings, Hazardous Materials, abandoned automobiles, trees, Excluded Waste, or any single item that exceeds eight (8) feet in length or five hundred (500) pounds in weight.

Additional Service: Contractor shall provide additional Bulky Item Collections to Single-Family Customers beyond two (2) times per year and shall Collect additional acceptable materials (as described herein) that exceed the required Service Level (as requested by Customer). Contractor may charge the appropriate Rates approved by the City for such additional service. Contractor shall accept, and Divert from Disposal, all mattresses Collected by Contractor, pursuant to Section 4.5.

Other Requirements: Contractor shall provide the service on the Customer’s regularly scheduled Collection Day and within five (5) Working Days of Contractor’s receipt of the Customer’s request for service.
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EXHIBIT B1

SINGLE-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B1-4 Service Agreement, Exhibit B1 B. Haul it Yourself Voucher Program
Containers: Customer vehicle or trailer no larger than four (4) feet by four (4) feet by eight (8) feet.

Service Level: Upon Customer or Occupant request. Items shall not exceed eight (8) feet in length or five hundred (500) pounds.

Service Frequency: Two (2) times per year
Service Location: Delivered to the Approved Transfer Facility by Customer or Occupant.

Acceptable Materials: Bulky Items
Prohibited Items: Food Scraps, Yard Trimmings, Hazardous Materials, abandoned automobiles, trees, Excluded Waste, or any single item that exceeds eight (8) feet in length or five hundred (500) pounds in weight.

Additional Service: Contractor shall accept, and Divert from Disposal, all mattresses delivered by Customer to the Approved Transfer Facility, pursuant to Section 4.5.

Other Requirements: Customers must contact Contractor to request a voucher. Contractor shall hold the voucher at the Approved Transfer Facility for Customer’s use within seven (7) Days of issuance.

5. Used Motor Oil and Filter Collection
Contractor shall Collect, by appointment only, Used Motor Oil and Used Oil Filters placed for Collection at Residential Premises from all Residential Customers. Contractor shall Recycle all Used Motor Oil and Filters Collected pursuant to this Agreement.

Containers: Plastic container with cap or container provided by the City for used motor oil.

Plastic zipper bag for used oil filter.

Container Sizes: Up to four (4) gallon plastic container for motor oil.

Service Frequency: Up to four (4) filters and four (4) plastic containers for motor oil per week on the same Day as Recyclable Materials Collection service.

Service Location: On private property, place at top of driveway or near garage.

Acceptable Materials: Used Motor Oil and Filters
Prohibited Materials: Recyclable Materials, Organic Materials, Garbage, Excluded Waste Additional Service: None
Other Requirements: Upon request by the Customer, the City will deliver a used motor oil container to a Customer at no additional cost to Customer.

Contractor shall Recycle the Used Motor Oil and Filter only with Persons who are authorized by the State of California to Recycle such materials. In the event the Used Motor Oil and Filter Collected pursuant to this Agreement is contaminated to the extent that the materials require Disposal as a Hazardous Waste, #6..
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EXHIBIT B1

SINGLE-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B1-5 Service Agreement, Exhibit B1 Contractor shall Dispose of such materials, at Contractor’s own cost and expense, in accordance with Applicable Law.

Contractor shall notify the City Contract Manager of any contamination which renders the Used Motor Oil and Filter unacceptable for Recycling or which requires Disposal as a Hazardous Waste.

Contractor shall keep all Used Motor Oil and Filters Collected pursuant to this Agreement segregated from other materials.

Contractor may refuse to Collect the used motor oil if it is not contained in an approved plastic container, provided that Contractor leaves a non-Collection notice that explains the reason for non-Collection. Contractor may refuse to Collect an approved plastic container that contains liquid other than used motor oil, provided that Contractor leaves a non-Collection notice that explains the reason for non-Collection.

6. Alternative Service Location for Disabled Single-Family Customers As directed by the City, Contractor shall allow for Persons that have a Disability, as defined by the Americans with Disabilities Act (Public Law 101-336, 104 Stat. 327, 42 U.S.C. 12101-12213 and 27 U.S.C. 225 and 611 and all Federal rules and regulations relating thereto), that are Occupants of Single-Family Premises to receive Collection services at a location other than Curbside at no extra charge to the Customer.

7. Container Sharing
As directed by the City, Contractor may allow Single-Family Customers to share Discarded Materials service with up to two (2) other adjacent Single-Family Premises with a total of four (4) or less residents.

Such shared service shall be performed and billed as if it were being provided to a single Customer or may be split between the two Customers at the City’s discretion, with the exception that the City shall require all Customers sharing a single service account to identify a Primary Responsible Party that will serve as the singular point of contact for communication and billing, along with a list of all addresses with which the Primary Responsible Party will share service.
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EXHIBIT B2:

MULTI-FAMILY RESIDENTIAL SERVICES
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EXHIBIT B2

MULTI-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B2-1 Service Agreement, Exhibit B2

1. Recyclable Materials Collection
Contractor shall Collect Recyclable Materials placed in Contractor-provided Containers from Multi-Family Customers not less than one (1) time per week, unless the Customer has a City-approved waiver or alternative compliance method. All Recyclable Materials shall be Transported to the Approved Recyclable Materials Processing Facility for Processing.

Containers: Carts and Bins
Container Sizes: 96-gallon Carts (or comparable size approved by the City); 2-, 3-, 4-, and 6-cubic yard Bins, as requested by Customer and approved by the City.

Service Frequency: One (1) time per week for Carts and up to six (6) times per week, but not less than one (1) time per week for Bins, as requested by the Multi-Family Customer or directed by the City.

Service Location: Curbside or other Customer-selected service location at the Multi-Family Premises
Acceptable Materials: Recyclable Materials
Prohibited Container Contaminants: Organic Materials, Garbage, Excluded Waste Additional Service: Special pick-ups requested by a Customer, on Days other than their regularly scheduled Collection Day, will be available at the City-approved Rate.

Other Requirements: Contractor shall open and close gates, push and/or pull Containers, lock and unlock Bins, or perform other services as reasonably necessary to access and service Containers (additional charges may apply). A push/pull of Containers up to fifteen (15) feet from the Enclosure/Container location to the Collection vehicle will be provided at no additional charge (push up to fifteen (15) feet then return).

MULTI-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B2-2 Service Agreement, Exhibit B2

2. Organic Materials Collection
Contractor shall Collect Organic Materials in Contractor-provided Containers from Multi-Family Customers not less than one (1) time per week, unless the Customer has a City-approved waiver or alternative compliance method. All Organic Materials shall be Transported to the Approved Organic Materials Processing Facility for Processing.

Containers: Carts and Bins
Container Sizes: 96-gallon Carts (or comparable size approved by the City); , 2-, 3-, 4-, and 6-cubic yard Bins, as requested by Customer and approved by the City.

Service Frequency: One (1) time per week for Carts and up to six (6) times per week for Bins, but not less than one (1) time per week, as requested by the Multi-Family Customer or directed by the City.

Service Location: Curbside or other Customer-selected service location at the Multi-Family Premises
Acceptable Materials: Organic Materials
Prohibited Container Contaminants: Recyclable Materials, Garbage, Excluded Waste Additional Service: Special pick-ups requested by a Customer, on Days other than their regularly scheduled Collection Day, will be available at the City-approved Rate.

Other Requirements: Contractor shall allow Multi-Family Customers to place Organic Materials in Compostable Plastic bags prior to placing the bagged Organic Materials into their Organic Materials Container for Collection, as directed by the City. If bagging their Organic Materials, Customers must use Compostable bags labeled as “Compostable” by the manufacturer that meet ASTM D6400 standard for Compostability.

Contractor shall open and close gates, push and/or pull Containers, lock and unlock Bins, or perform other services as reasonably necessary to access and empty Containers (additional charges may apply). A push/pull of Containers up to fifteen (15) feet from the Enclosure/Container location to the Collection vehicle will be provided at no additional charge (push up to fifteen (15) feet then return).

MULTI-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B2-3 Service Agreement, Exhibit B2 account number, Customer phone number, and material type of the Container in question.

3. Garbage Collection
Contractor shall Collect Garbage placed in Contractor-provided Containers from Multi-Family Customers not less than one (1) time per week. All Garbage shall be Transported to the Approved Disposal Facility for Disposal.

Containers: Carts and Bins
Container Sizes: 64- and 96-gallon Carts (or comparable size approved by the City); , 2-, 3-, 4-, ,and 6-cubic yard Bins, as requested by Customer.

Service Location: Curbside or other Customer-selected service location at the Multi-Family Premises.

Acceptable Materials: Garbage
Prohibited Container Contaminants: Recyclable Materials, Organic Materials, Excluded Waste Additional Service: Special pick-ups requested by a Customer, on Days other than their regularly scheduled Collection Day, will be available at an approved additional charge.

Other Requirements: Contractor shall open and close gates, push and/or pull Containers, lock and unlock Bins, or perform other services as reasonably necessary to access and service Containers (additional charge may apply). A push/pull of Containers up to fifteen (15) feet from the Enclosure/Container location to the Collection vehicle will be provided at no additional charge (push up to fifteen (15) feet then return).

4. Bulky Item Collection Program
Contractor shall Collect Bulky Items from Multi-Family Customers or Occupants or provide vouchers for delivery of Bulky Items by Customer or Occupant to the Approved Transfer Facility. In the event a question arises as to whether a specific item or category of items meets the definition of Bulky Item, the City Contract Manager will make the final determination. Contractor shall Transport all Collected Bulky Items to the appropriate Approved Facility for reuse, repair, Processing, or Disposal based on the Reusable Materials Hierarchy.

A. Bulky Item Collection
Containers: Not applicable
Service Level: Upon Customer or Occupant request. Items shall not exceed eight (8) feet in length, or five hundred (500) pounds.
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EXHIBIT B2

MULTI-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B2-4 Service Agreement, Exhibit B2 Service Frequency: Up to twelve (12) times per year, during the first week of the month.

Service Location: Curbside
Acceptable Materials: Bulky Items
Prohibited Items: Household Garbage, Food Scraps, Yard Trimmings, Hazardous Materials, abandoned automobiles, trees, Excluded Waste, or any single item that exceeds eight (8) feet in length or five hundred (500) pounds in weight.

Additional Service: Contractor shall provide additional Bulky Item Collections to Multi-Family Customers beyond twelve (12) times per year and shall Collect additional acceptable materials (as described herein) that exceed the required Service Level (as requested by Customer. Contractor may charge the appropriate Rates approved by the City for such additional service. Contractor shall accept, and Divert from Disposal, all mattresses Collected by Contractor pursuant to Section

4.5. Other Requirements: Contractor shall provide the service on the Customer’s regularly scheduled Collection Day, the first week of each month upon receipt of the request for service.

B. Haul it Yourself Voucher Program
Containers: Customer vehicle or trailer no larger than four (4) feet by four (4) feet by eight (8) feet.

Service Level: Upon Customer or Occupant request. Items shall not exceed eight (8) feet in length or five hundred (500) pounds.

Service Frequency: Two (2) times per year per unit Occupant Service Location: Delivered to Approved Transfer Facility by Customer or Occupant.

Acceptable Materials: Bulky Items
Prohibited Items: Household Garbage, Food Scraps, Yard Trimmings, Hazardous Materials, abandoned automobiles, trees, Excluded Waste, or any single item that exceeds eight (8) feet in length or five hundred (500) pounds in weight.

Additional Service: Contractor shall accept, and Divert from Disposal, all mattresses delivered by Customer to the Approved Transfer Facility, pursuant to Section 4.5.

Other Requirements: Customers must contact Contractor to request a voucher. Contractor shall hold the voucher at the Approved Transfer Facility for Customer’s use within seven (7) Days of issuance.

5. Used Motor Oil and Filter Collection
Contractor shall Collect, by appointment only, Used Motor Oil and Filters placed for Collection at Residential Premises from all Residential Customers or Occupants. Contractor shall Recycle all Used Motor Oil and Filters Collected pursuant to this Agreement.
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EXHIBIT B2

MULTI-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B2-5 Service Agreement, Exhibit B2 Containers: Plastic container with cap or container provided by the City for used motor oil.

Plastic zipper bag for used oil filter.

Container Sizes: Up to four (4) gallon plastic container for motor oil.

Service Frequency: Up to four (4) filters and four (4) plastic container for motor oil per resident, per week on the same Day as Recyclable Materials Collection service.

Service Location: Contractor shall Collect from a designated location at the Multi-Family Premises mutually agreed upon between Contractor and the Occupant requesting service.

Contractor shall notify the City Contract Manager of any contamination which renders the Used Motor Oil and Filter unacceptable for Recycling or which requires Disposal as a Hazardous Waste.

Contractor shall keep all Used Motor Oil and Filters Collected pursuant to this Agreement segregated from other materials.

Contractor may refuse to Collect used motor oil if it is not contained in an approved plastic container, provided that Contractor leaves a non-Collection notice that explains the reason for non-Collection. Contractor may refuse to Collect an approved plastic container that contains liquid other than used motor oil, provided that Contractor leaves a non-Collection notice that explains the reason for non-Collection.

6. Container Sharing
As directed by the City, Contractor shall allow Multi-Family Customers to share Discarded Materials service with three (3) other adjacent Multi-Family Premises with a total of four (4) or less residents. Such shared service shall be performed and billed as if it were being provided to a single Customer or may be split between the two Customers at the City’s discretion, with the exception that the City shall require all Customers sharing a single service account to identify a Primary Responsible Party that will serve as the singular point of contact for communication and billing, along with a list of all addresses with which the Primary Responsible Party will share service.
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EXHIBIT B2

MULTI-FAMILY RESIDENTIAL SERVICES
January 27, 2026 Page B2-6 Service Agreement, Exhibit B2 #6..
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EXHIBIT B3:

COMMERCIAL SERVICES
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EXHIBIT B3

COMMERCIAL SERVICES
January 27, 2026 Page B3-1 Service Agreement, Exhibit B3

1. Recyclable Materials Collection
Contractor shall Collect Recyclable Materials placed in Contractor-provided Containers from Commercial Customers not less than one (1) time per week, unless the Customer has a City-approved waiver or alternative compliance method. All Recyclable Materials shall be Transported to the Approved Recyclable Materials Processing Facility for Processing.

Containers: Carts, Bins, Roll-Off Boxes, and Compactors Container Sizes: 96-gallon Carts (or comparable size approved by the City); , 2-, 3-, 4-, and 6-cubic yard Bins, as requested by the Customer and approved by the City; and 10-, 20-, 30-, and 40-cubic yard Roll-Off Boxes; or Compactors, as requested by the Customer.

If any Commercial Customer receives service for Garbage, Recyclable Materials, and Organic Materials Carts in the same manner as Single-Family Customers, all Carts must be serviced on the same Collection Day.

Service Frequency: One (1) time per week for Carts and up to six (6) times per week for Bins, but not less than one (1) time per week, as requested by Customer or directed by the City.

Service Location: Curbside or other Customer-selected service location at the Commercial Premises; additional charges may apply if the service location is greater than fifteen (15) feet from the nearest point that a Collection vehicle can access from a paved surface.

Contractor shall ensure the designated pick-up area for Roll-Off Boxes and Compactors are in accordance with all Applicable Laws and permit conditions and does not impede the flow of traffic.

Acceptable Materials: Recyclable Materials
Prohibited Container Contaminants: Organic Materials, Garbage, Excluded Waste Additional Service: Special pick-ups requested by a Customer, on Days other than their regularly scheduled Collection Day, will be available at the City-approved Rate.

Other Requirements: Contractor shall open and close gates, push and/or pull Containers, lock and unlock Bins, or perform other services as reasonably necessary to access and empty Containers (additional charges may apply). A push/pull of Containers up to fifteen (15) feet from the Enclosure/Container location to the Collection vehicle will be provided at no additional charge (push up to fifteen (15) feet then return.) Contractor may refuse to Collect a Recyclable Materials Container that contains any presence of Prohibited Container Contaminants, provided that Contractor leaves a non-Collection notice in accordance with Subsection 5.3.B of this Agreement. Contractor shall instruct the Customer to either remove the Prohibited Container Contaminants or pay the City-approved Rate to have the contents of the contaminated Recyclable Materials Container Collected as Garbage. Contractor may charge the Customer the City-approved Rate for a #6..
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EXHIBIT B3

COMMERCIAL SERVICES
January 27, 2026 Page B3-2 Service Agreement, Exhibit B3 special pick-up if the Customer elects to have their corrected or contaminated Recyclable Materials Container serviced before the next regular Collection Day.

2. Organic Materials Collection
Contractor shall Collect Organic Materials placed in Contractor-provided Containers from Commercial Customers not less than one (1) time per week, unless the Customer has a City-approved waiver or alternative compliance method. All Organic Materials shall be Transported to the Approved Organic Materials Processing Facility for Processing.

Containers: Carts, Bins, and Compactors
Container Sizes: 96-gallon Carts (or comparable size approved by the City); 2-, 3-, 4-, and 6-cubic yard Bins, as requested by Customer and approved by the City.

Service Frequency: One (1) time per week for Carts and up to six (6) times per week, but not less than one (1) time per week, as requested by Customer or directed by the City.

Contractor shall ensure the designated pick-up area for Roll-Off Boxes and Compactors are in accordance with all Applicable Laws and permit conditions and does not impede the flow of traffic.

Acceptable Materials: Organic Materials
Prohibited Container Contaminants: Recyclable Materials, Garbage, Excluded Waste Additional Service: Special pick-ups requested by a Customer, on Days other than their regularly scheduled Collection Day, will be available at the City-approved Rate.

COMMERCIAL SERVICES
January 27, 2026 Page B3-3 Service Agreement, Exhibit B3 fifteen (15) feet from the Enclosure/Container location to the Collection vehicle will be provided at no additional charge (push up to fifteen (15) feet then return).

Contractor shall allow Commercial Customers to place Organic Materials in Compostable Plastic bags prior to placing the bagged Organic Materials into their Organic Materials Containers for Collection, as directed by the City. If bagging their Organic Materials, Customers must use Compostable bags labeled as “Compostable” that meet the ASTM D6400 standard for Compostability.

Contractor may refuse to Collect an Organic Materials Container that contains any presence of Prohibited Container Contaminants, provided that Contractor leaves a non-Collection notice in accordance with Subsection 5.3.B of this Agreement. Contractor shall instruct the Customer to either remove the Prohibited Container Contaminants or pay the City-approve Rate to have the contents of the contaminated Organic Materials Container Collected as Garbage.

3. Garbage Collection
Contractor shall Collect Garbage placed in Contractor-provided Containers from Commercial Customers not less than one (1) time per week. All Garbage shall be Transported to the Approved Disposal Facility for Disposal.

Containers: Carts, Bins, Roll-Off Boxes, and Compactors Container Sizes: 64- and 96-gallon Carts (or comparable size approved by the City); -, 2-, 3-, 4-,and 6-cubic yard Bins; and 10-, 20-, 30-, and 40-cubic yard Roll-Off Boxes; or Compactors, as requested by Customer.

If any Customer receives service for Garbage, Recyclable Materials, and Organic Materials Carts in the same manner as Single-Family Customers, all Carts must be serviced on the same Collection Day.

Service Frequency: One time per week for Carts and up to six (6) times per week for Bins, but not less than one (1) time per week, as requested by Customer or directed by the City.

COMMERCIAL SERVICES
January 27, 2026 Page B3-4 Service Agreement, Exhibit B3 Contractor shall ensure the designated pick-up area for Roll-Off Boxes and Compactors are in accordance with all Applicable Laws and permit conditions and does not impede the flow of traffic.

4. Container Sharing
As directed by the City, Contractor shall allow Commercial Customers to share Discarded Materials service with three (3) other adjacent Commercial Premises. Such shared service shall be performed and billed as if it were being provided to a single Customer or may be split between the Customers at the City’s discretion, with the exception that the City shall require all Customers sharing a single service account to identify a Primary Responsible Party that will serve as the singular point of contact for communication and billing, along with a list of all addresses with which the Primary Responsible Party will share service. #6..
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EXHIBIT B4:

CITY SERVICES
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EXHIBIT B4

CITY SERVICES
January 27, 2026 Page B4-1 Service Agreement, Exhibit B4

1. Commercial Customer Services to City Facilities
Contractor shall Collect Recyclable Materials, Organic Materials, and Garbage from City facilities in the same manner and at the same Rates as those services are provided to Commercial Customers. Contractor shall provide designated personnel in accordance with Subsection 5.7.E of this Agreement. Contractor shall provide service to all existing City facilities, as well as any future City facilities established in the Service Area after the Commencement Date.

Contractor shall provide, upon request, temporary Roll-Off Box services to all City facilities at Cityapproved Commercial Rates. Contractor shall deliver Roll-Off Boxes within twenty-four (24) hours of City request. Contractor shall Collect, empty, and return Roll-Off Boxes within twenty-four (24) hours of City request. Contactor shall remove and not return Roll-Off Boxes within twenty-four (24) hours of City request. As directed by the City, Contractor shall deliver Source Separated Yard Trimmings Collected from City facilities, parks, and cleanup operations in Roll-Off Boxes to the Approved Transfer Facility for Transfer to the Approved Organic Materials Processing Facility.

Contractor shall provide special event services, as requested by the City’s Solid Waste Division, as described in Section 4.7 at no additional costs.

2. Emergency Services
Contractor shall provide emergency services (i.e., special Collections, Transport, Processing, and Disposal) at the request of the City Contract Manager in the event of major accidents, disruptions, or natural calamities. Contractor shall be capable of providing emergency services within twenty-four (24) hours of notification by the City Contract Manager or as soon thereafter as is reasonably practical in light of the circumstances. For any services that exceed the scope of services under this Agreement, Contractor shall be entitled to compensation at the emergency service Rates approved under this Agreement. The City shall have discretion to decide the method of payment for such compensation: (i) direct payments by the City; or (ii) allowing such costs to be considered in the adjustment of Rates for the following Rate Period.

3. Provision of Compost and Mulch Product
A. Bulk Compost Product and Mulch. Contractor agrees to Transport and deliver, at no additional cost to the City, up to five (5) deliveries of Compost Product or Mulch per year. The quantity of Compost Product or Mulch to be delivered for each occurrence shall be an amount mutually agreed upon by the City and Contractor, not to exceed thirty-five (35) cubic yards per occurrence. The City will notify Contractor of the City’s needs for delivery of Compost Product or Mulch throughout the Agreement year. Contractor shall deliver Compost Product or Mulch to any accessible location within City limits within five (5) Business Days of the City’s request, at no additional cost to the City.

4. Waste Generation, Characterization, and Pilot Studies Contractor acknowledges that the City, CalRecycle, or other governmental agencies may wish to perform generation and characterization studies periodically with respect to materials covered under this #6..
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EXHIBIT B4

CITY SERVICES
January 27, 2026 Page B4-2 Service Agreement, Exhibit B4 Agreement. Contractor agrees to participate and cooperate with City and its agents to perform studies and data collection exercises to determine weights, volumes and composition of materials generated, Disposed, Diverted, or otherwise Processed. If the City requires Contractor to participate in such a study, the City shall have full authority over the direction of the study and Contractor shall cooperate fully with the City. In any event, Contractor shall permit, and in no way interfere, with the Collection and handling of the subject materials by other Persons for such purposes. Contractor shall pay a Waste Generation and Characterization Reimbursement in accordance with Section 7.4.

Contractor acknowledges that the County, in coordination with the City, is required by SB 1383 to conduct Organic Waste and Edible Food capacity planning studies. Contractor shall provide information to the City as needed for the City’s participation in such capacity planning studies. This information and/or participation may include, but is not limited to, conducting or supporting waste characterization studies; providing information regarding existing and potential new or expanded capacity in Contractor’s operations for the Collection, Transport, or Processing of Recyclable Materials and Organic Materials; and any other information deemed necessary by the City or County for purposes of the study. Contractor shall respond to any request for information from the City within thirty (30) Days, unless another timeframe is otherwise specified or authorized in writing by the City.

Contractor acknowledges that the City may wish to conduct and/or participate in pilot studies related to the Customers and materials that are the subject of this Agreement. If the City requires Contractor to participate in any such pilot study, Contractor and the City shall mutually agree on the scope of services to be provided by Contractor and the amount of compensation, if any, that the City will pay to Contractor for such participation. In any event, Contractor shall permit, and in no way interfere, with the Collection and handling of the subject materials by other Persons for such purposes.

5. Illegal Dumping
Contractor shall pick up and Dispose of illegally dumped items left in or adjacent to Public Right-of-Way within two (2) Working Days of the City Contract Manager or their designee’s request. Contractor may bill the City for staff, equipment, and Processing and/or Disposal fees at the City-approved Rate.

The City shall provide Contractor written requests, including a list of specific location(s) where Contractor can locate illegally dumped items for Collection. Contractor shall submit back to the City evidence of completion, in accordance with Section 4.10.

6. Community Cleanup Events
Contractor shall participate in at least two (2) City-sponsored cleanup events annually (Drive Up Drop Off events). Contractor shall provide Roll-Off Boxes for the Collection of Garbage, Recyclable Materials, Organic Materials, tires, and Bulky Items. Contractor shall attend any meetings scheduled by the City related to the planning and coordination of such events. Within fourteen (14) Days following the conclusion of each event, Contractor shall submit a report to the City Contract Manager that includes all related itemized invoices.
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EXHIBIT B4

CITY SERVICES
January 27, 2026 Page B4-3 Service Agreement, Exhibit B4 Contractor may charge the City for Roll-Off Boxes at the City-approved Rates. Contractor shall not be required to Collect Excluded Waste.
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EXHIBIT C:

CUSTOMER SERVICE PLAN
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EXHIBIT D:

REPORTING REQUIREMENTS
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EXHIBIT D

REPORTING REQUIREMENTS
January 27, 2026 Page D-1 Service Agreement, Exhibit D

1. General
As defined in this Agreement, Records shall be maintained in forms and by methods that facilitate flexible use of data contained in them to structure reports as needed. Contractor shall submit reports in a format approved by the City. Reports are intended to compile recorded data into useful forms of information that can be used to, among other things:

A. Determine and set Rates and evaluate the financial efficacy of operations.

B. Evaluate past and expected progress towards achieving Contractor’s Diversion goals and objectives.

C. Provide concise and comprehensive program information and metrics for use in fulfilling reporting requirements under Applicable Law.

D. Determine needs for adjustment to programs.

E. Evaluate Customer service and Complaints.

F. Determine Customer compliance with State-mandated Recyclable Materials requirements.

2. Monthly Report Content
Monthly reports shall be submitted by Contractor’s Contract Manager to the City Contract Manager and shall include the following information pertaining to the most recently completed calendar month. In addition, each monthly report shall include a year-to-date summary page that includes the data submitted from the monthly report(s) submitted in the calendar year prior. Contractor shall report the information included in the following Subsections. All portions of the report shall be fully complete and accurate as of the date of the report.

A. Cover
Contractor acknowledges that all information contained in this report is only for the City and all information contained in this report is complete and accurate. This must be signed by Contractor’s Contract Manager.

B. Tonnage Report

1. Tonnage delivered to each Approved Facility by Customer Type and material type, including Recyclable Materials, Organic Materials, Garbage, C&D Debris, and Residue, subtotaling and clearly identifying those Tons that are Diverted and those that are Disposed.

2. Yard Trimmings Tonnage delivered to each Approved Facility from the City Packer and Gondola Truck by the City Forestry/Green Waste Division.
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EXHIBIT D

REPORTING REQUIREMENTS
January 27, 2026 Page D-2 Service Agreement, Exhibit D

3. Bulky Items Tonnage reused, Recycled, and Disposed from non-Divertible materials, and Processing Residue, from Bulky Item Collection and the haul it yourself voucher program, by Customer Type and material type.

4. Recyclable Materials Tonnage Marketed (by commodity and including average commodity value for each) and Processing Residue Tonnage Disposed.

5. Gallons of used motor oil, number of used motor oil filters, and number of stops.

6. Tons of Discarded Materials removed from illegal Disposal sites, by material type, including Recyclable Materials, Organic Materials, Garbage, C&D Debris, and Residue.

7. Monthly Diversion rate by Customer Type and in aggregate for all Customer Types under this Agreement.

C. Diversion Report
The Diversion level for each month and the cumulative year-to-date Diversion level, where Diversion level shall be calculated as: (Discarded Materials Collected – Garbage Collected – Processing Residue Disposed) / Discarded Materials Collected.

D. Customer Subscription Report

1. List of all Customers by Customer Type with associated service address, Service Level, Container identification number, Day of service, Container labeling status, and Rates charged.

2. Number of Containers at each Service Level by Customer Type and material type. Summarize the total gallons of Cart service, cubic yards of Bin service, and cubic yards or Tons of Roll-Off and Compactor service, including pulls, by Customer Type. Report should calculate the average volume of service received per Customer Type.

3. Number of Bulky Item Collection events by Customer Type.

4. List of Customers with suspended Collection service as a result of unpaid bills in accordance with Subsection 4.11.F by Customer Type, including Customer name, service address, direction of street (if applicable), and billing address.

E. Customer Service Report

1. List of all new service requests for each Customer Type, including Customer name, service address, billing address, direction of street (if applicable), number of units (if applicable), contact information, phone number, email address, Service Level, Container identification number, Container labeling status, and Rates charged.

2. List of Customers that have requested changes to Service Levels or stopped services for each Customer Type, including name, service address, billing address, direction of street (if applicable), #6..
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EXHIBIT D

REPORTING REQUIREMENTS
January 27, 2026 Page D-3 Service Agreement, Exhibit D
contact information, initial Service Level, current Service Level (if applicable); date of request, and new Container identification number(s).

3. List of Customers that have requested repair and replacement of Containers by Customer Type, including name, service address, billing address, direction of street (if applicable), contact information, initial Service Level, current Service Level (if applicable); date of request, and new Container identification number(s).

4. List of all Bulky Items from Bulky Item Collection and haul it yourself voucher program by Customer Type and program, including request date, pick up date or voucher drop off date, location, Customer name, Customer phone number, and description of Bulky item Collected from Bulky Item Collection.

5. List of all illegal dumping requests from the City, including request date, pick up date, specific pick up location, date of submittal of photographic evidence confirming Collection, and description of items Collected.

6. Number of Customer calls listed separately by Complaints and inquiries (where inquiries include requests for Recycling information, Rate information, Service Level changes, Container replacement requests, etc.). For Complaints, list the number of calls separately by category (e.g., missed pickups, scheduled cleanups, billing concerns, damage claims). These Complaints and inquiries shall be documented and reported separately from SB 1383 non-compliance Complaints or other regulatory non-compliance Complaints.

7. Customer Service representative response time for phone calls and emails documented in minutes, as well as the percentage of calls/emails that were responded to after one (1) Business Day.

8. Number of missed or incomplete Collections reported in total, and per one thousand (1,000) Service Opportunities in the City, presented in a graph format with corresponding data that compares total missed Collections in the City during the current report period to total missed Collections in the City in past reporting periods.

9. Number of events of Discarded Materials being tagged for non-Collection, summarized by the reason for tagging (e.g., inclusion of non-Recyclable or non-Compostable materials, improper set out, Hazardous Waste, etc.).

10. List of Customers for which Contractor has performed a courtesy Collection, including the Customer address and material type of the Container.

11. Record of SB 1383 non-compliance Complaints received, including the following information:
i. Total number of Complaints received and total number of Complaints investigated. ii. Copies of documentation recorded for each Complaint received, which shall, at a minimum, include the following information: (i) the Complaint as received; (ii) the name and contact information of the complainant, if the Complaint is not submitted anonymously; (iii) the identity of the alleged violator, if known; (iv) a description of the alleged violation; including location(s) and all other relevant facts known to the complainant; (v) any relevant #6..
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EXHIBIT D

REPORTING REQUIREMENTS
January 27, 2026 Page D-4 Service Agreement, Exhibit D
photographic or documentary evidence submitted to support the allegations in the Complaint; and, (vi) the identity of any witnesses, if known. iii. Copies of all Complaint reports submitted to the City, pursuant to Subsection 4.12.2 of this Agreement.
iv. Documentation of any follow-up inspections and/or outreach, if any, conducted upon City request, pursuant to Section 4.12.4 of this Agreement, which shall include, at a minimum: (i) the date Contractor investigated the Complaint; (ii) documentation of the findings of the investigation; and, (iii) any photographic or other evidence collected during the investigation.

12. Number of Customers subscribing to each City-approved service exemption by Customer Type.

F. Events Log
Log of any Federal, State, or local regulatory inspections of Contractor’s or Subcontractor’s facilities; equipment issues, including vehicle breakdowns; or other events. The log should also include the date of the event.

G. Education and Outreach

1. Dates, times, and group or event names of any site visits, meetings, and events attended in the month.

2. Identify the type and quantity of all City approved education and outreach materials provided to Generators, or otherwise used for education and outreach efforts in accordance with Section 4.8 of the Agreement, including, but not limited to: flyers, brochures, newsletters, invoice messaging/billing inserts, and website and social media postings.

3. For any mass distribution of City-approved materials through mailings or bill inserts, provide a record of the date, a copy of the information distributed, and the Customer Type and number of accounts that received the information.

4. A copy of all City-approved electronic media, including the dates posted or sent for: social media posts, email communications, or other electronic messages. A summary report shall be provided for electronic marketing that itemizes each communication and reports performance metrics for each communication that are relevant to that type of communication (e.g., open and click-through rates for email marketing, engagement numbers for social media).

H. Pilot and New Programs Report
For each pilot and/or new program, provide activity related and narrative reports on goals, milestones, and accomplishments. Describe problems encountered, actions taken, and any recommendations to facilitate progress. Describe vehicles, personnel, and equipment utilized for each program. #6..
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EXHIBIT D

REPORTING REQUIREMENTS
January 27, 2026 Page D-5 Service Agreement, Exhibit D
I. Revenue Report.

Statement detailing Gross Receipts by material type from all operations conducted or permitted pursuant to this Agreement as required by Section 7.6.

3. Annual Report Content
The annual report shall be the final monthly report, including annual totals, summary pages, and a compilation of any materials required by the monthly reports, plus the following additional information.

The annual report is due sixty (60) Days after the end of the calendar year. Contractor shall submit reports in a format approved by the City. Reports are intended to compile recorded data into useful forms of information that can be used to, among other things:

A. Summary Assessment. Provide a summary assessment of the programs performed under this Agreement from Contractor's perspective, relative to the financial and physical status of the program. The physical status assessment shall reflect how well the program is operating in terms of efficiency, economy, and effectiveness in meeting all the goals and objectives of this Agreement, particularly Contractor’s Diversion goals. Provide recommendations and plans to improve and highlight significant accomplishments and problems. Results shall be compared to other similar size communities served by the Contactor in the State.

B. Summary of Monthly Report. Provide a summary of all the items listed in Section 2 of this Exhibit.

C. Vehicle Inventory. A list of all vehicles used in performing services under this Agreement, including the license plate number, VIN, make, model, model year, purchase date, engine overhaul/rebuild date (if applicable), and mileage on December 31.

D. Recyclable Materials Markets. Contractor shall provide a report describing its marketing of Recyclable Materials. The marketing report shall include: i) quantities of each accepted Recyclable Material marketed during the prior year; ii) actual prior year and estimated coming year per-unit or per-Ton market values for each material marketed; and, 3) brokers, markets, and end uses for each material marketed.

E. AB 341 and AB 1826 Compliance. Provide a list of Commercial Customers subscribing to four (4) or more cubic yards of Garbage service per week who do not currently subscribe to Recyclable Materials Collection service from Contractor and a list of Commercial Customers subscribing to two (2) or more cubic yards of Garbage service per week who do not currently subscribe to Organic Materials Collection service from Contractor.

4. Additional Reports
A. Upon Incident Reporting. The City reserves the right to request additional reports or documents in the case of unforeseen events or additional requirements imposed upon the City. Contractor shall provide the requested reports, documents, or information within ten (10) Business Days upon #6..
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EXHIBIT D

REPORTING REQUIREMENTS
January 27, 2026 Page D-6 Service Agreement, Exhibit D
receipt of the City request, or within a timeframe determined by the City Contract Manager, which shall not exceed ten (10) Days.

B. AB 901 Reporting. At the City’s option, the City may require that Contractor provide the City copies of Contractor’s AB 901 reports on a regular basis (such as monthly, quarterly, or annually), or within ten (10) Business Days of the request.

C. CalRecycle Reports. At the City’s option, the City reserves the right to request Contractor to submit any and all information that the City Contract Manager finds necessary in the preparation of the Electronic Annual Report (EAR) required by CalRecycle. Contractor shall provide any requested reports, documents, or information within ten (10) Business Days upon receipt of the request by the City Contract Manager.

D. SB 1383 Compliance. The City reserves the right to request Contractor to provide customized reports from records Contractor is required to maintain, including, but not limited to, SB 1383 implementation, implementation of technical assistance, etc.

E. Customized Reports. The City reserves the right to request Contractor to prepare and provide customized reports from records Contractor is required to maintain; or require a specified format or submission system, such as the use of a web-based software platform, for such reports. #6..
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EXHIBIT E:

RATE ADJUSTMENT METHODOLOGY
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EXHIBIT E

RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E-1 Service Agreement, Exhibit E

1. General
Subject to the terms herein, the City shall adjust all Rates on an annual basis. Contractor shall submit its application for a Rate adjustment to the City Contract Manager on or before February 1 of each Rate Period where Rates shall be adjusted using the index-based methodology described in Exhibit E1.

Contractor shall submit its application on or before January 1 for any Rate Period where Rates shall be adjusted using the cost-based methodology described in Exhibit E2. Contractor’s Rate application shall document all calculations and include all supporting schedules, documentation of per-Ton charges for Approved Facilities, documentation of changes in governmental fees at Approved Facilities (if applicable), and any other documentation or evidence determined by the City Contract Manager to be reasonably necessary to ensure that the calculation of Rate adjustments has been performed in strict conformance to the requirements of this Exhibit.

The City Council shall make a good faith effort to approve Rates by June 1 of each year, and such Rates shall be effective on each subsequent July 1. If Rates are not effective by July 1 due to a delay caused solely by City, City shall allow Contractor to retroactively bill Customers for the amount of the Rate increase for any period of said delay that is solely caused by City (subject to mutual agreement of how the retroactive adjustment is billed, not to exceed three (3) months for Contractor to recover the retroactive billing amount) or the City may compensate the Contractor for lost gross rate revenues within a reasonable time. If Rates are not effective by July 1 as a result of Contractor’s delay in submitting the Rate application in a complete and accurate form, then prior Rates remain in effect until such adjustment is made and Contractor shall not be entitled to a retroactive adjustment for lost gross rate revenues. #6..
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EXHIBIT E

RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E-2 Service Agreement, Exhibit E

2. Definitions
Certain terms that are specific to this Exhibit (including Exhibits E1 and E2) are defined below:

A. “AB 939/SB 1383 Fee” means the fee paid by Contractor to the City, as described in Section 7.2 of the Agreement.

B. “Annual Percentage Change” means the annual percentage change in any of the indices defined within this Exhibit, calculated as described in the following paragraph.

The Annual Percentage Change for a cost index shall be calculated as the Average Index Value for the most recently available twelve- (12) month period of the then-current Rate Period minus the Average Index Value for the corresponding twelve- (12) month period of the most-recently completed Rate Period and the result of which shall be divided by the Average Index Value for the same twelve- (12) month period of the most recently completed Rate Period.

For example, if the Contractor is calculating the Total Calculated Costs in January 2027 to be effective for Rate Period Two (July 2027 through June 2028), the Annual Percentage Change for the CPI-U would be calculated as follows:
[ (Average CPI-U for January 2026 through December 2026) minus (Average CPI-U for January 2025 through December 2025)] divided by (Average CPI-U for January 2025 through December 2025) The calculated Annual Percentage Change shall be carried to three (3) places to the right of the decimal and rounded to the nearest thousandth.

C. “Average Index Value” means the sum of the monthly index values during the most recently available twelve- (12) month period divided by twelve (12) (in the case of indices published monthly) or the sum of the bi-monthly index values divided by six (6) (in the case of indices published bimonthly).

D. “CPI-U” means the Consumer Price Index, All Urban Consumers, all items, not seasonally adjusted, San Francisco-Oakland-Hayward Metropolitan Area, compiled and published by the U.S.

Department of Labor, Bureau of Labor Statistics.

E. “ECI” means the Employment Cost Index, Total Compensation, Private Industry, Service-Providing Industries, seasonally adjusted, compiled and published by the U.S. Department of Labor, Bureau of Labor Statistics.

F. “Franchise Fee” means the fee paid by Contractor to the City, as described in Section 7.1.

G. “PPI - Fuel Pricing Index” means the Producer Price Index, Commodities, not seasonally adjusted, No. 2 Diesel Fuel (Series Id: wpu057303), compiled and published by the U.S. Department of Labor, Bureau of Labor Statistics.
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EXHIBIT E

RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E-3 Service Agreement, Exhibit E
H. “Motor Vehicle Maintenance and Repair Index” or “MVI” means the Consumer Price Index, All Urban Consumers, Motor Vehicle Maintenance and Repair, not seasonally adjusted, U.S. city average, compiled and published by the U.S. Department of Labor, Bureau of Labor Statistics.

I. “Processing and Disposal Costs” means the separate, and in combination, costs of Processing and Disposing of Discarded Materials at the Designated Facility or the Approved Facility, calculated as the per-ton fee multiplied by the total Tons of material.

J. “Public Education Reimbursement” means the fee paid from Contractor to the City to reimburse the City for the cost of providing public outreach and educational programs, as described in Section

7.3 of the Agreement.

K. “Total Calculated Costs” means the total amount to be used as a basis for determining the Rate Adjustment Factor. The Total Calculated Costs do not reflect or in any way guarantee the gross rate revenues that are to be generated by Rates or retained by the Contractor. Note that for determining Rates for Rate Period Two, the total Proposed costs for Rate Period One (May 1, 2026 through June 30, 2027) shall be used for the calculations.

L. “Waste Generation and Characterization Reimbursement” means the fee paid from Contractor to the City to perform waste generation and characterization studies, as detailed in Section 7.4 of the Agreement.

Table 1 provides additional information about the four indices defined above.

TABLE 1*
CPI-U Fuel Index
Motor Vehicle
Maintenance and
Repair
ECI
Description Consumer Price
Index - All Urban
Consumers
Producer Price Index –
Commodities for #2
Diesel Fuel
Consumer Price
Index – All Urban
Consumers, Motor
Vehicle
Maintenance and
Repair
Employer Cost Index
– Total
Compensation for
Private Industry
Workers in Service
Providing Industries.

Series ID WPU057303 CUUR0000SETD CIS201S000000000I
Adjusted Not seasonally
adjusted
Not seasonally
adjusted
Not seasonally
adjusted
Seasonally adjusted
Area San FranciscoOakland-Hayward
Metropolitan Area
Fuels and Related
Products
U.S. City average N/A
Item All items #2 Diesel fuel Motor vehicle
maintenance and
repair
Total Compensation
Base
Period
1967=100 1982 = 100 1982-84=100 Dec 2005 = 100
Periodicity Bi-monthly Monthly Monthly Quarterly
Commented [SP4]: Note: Date to be updated if RP1 changes. #6..
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EXHIBIT E

RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E-4 Service Agreement, Exhibit E
* All indices published by the U.S. Bureau of Labor Statistics.

3. Cost of Rate Adjustment Process
The City may incur costs, including consulting and legal fees, when determining adjustments to the Rates in accordance with this Exhibit and may require the Contractor to pay for such costs within sixty (60) calendar Days of receipt of the City’s invoice for such costs. The Contractor may recover such costs through the Rates by treating the costs as an allowable pass-through cost. Regardless of Contractor’s payment of costs associated with said review, the City shall retain full and unimpeded discretion in selection of its agents to ensure, at a minimum, that no conflict of interest arises in the review of Contractor’s request. The City retains the right to select its agents on the basis of their qualifications and experience and without regard to cost.
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EXHIBIT E1:

MULTI-INDEX RATE ADJUSTMENT METHODOLOGY
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EXHIBIT E1

MULTI-INDEX RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E1-1 Service Agreement, Exhibit E1

1. General
The purpose of this attachment is to describe and illustrate the method by which the City will calculate the annual adjustment to Rates to reflect changes in various cost indices and changes to Processing and Disposal Costs based on Tonnages of materials Collected and changes in tipping fees. This index-based adjustment process shall be used to determine Rates for all Rate Periods beginning with Rate Period Two (July 1, 2027 through June 30, 2028) with the exception that in place of the index adjustment to set Rates, the methodology described in Exhibit E2 shall be used in Rate Periods Three, Seven, and upon any extension of this Agreement pursuant to Section 2.2, including Rate Period Ten , subject to the provisions of Article 8 of the Agreement.

The index-based adjustment involves application of indices to various costs that comprise the Total Proposed Annual Costs for Rate Period One (and to Total Calculated Costs for future Rate Periods) to determine the Total Calculated Costs for the coming Rate Period. In addition, Processing and Disposal costs shall be adjusted to reflect actual Tonnage Collected during the most-recently completed Rate Period.

The difference (measured as a percentage) between the Total Calculated Costs for the coming Rate Period and the Total Calculated Costs for the then-current Rate Period is the Rate Adjustment Factor. The Rate Adjustment Factor is applied to the current Rates to determine the Rates for the coming Rate Period.

The Rate Adjustment Factor calculated pursuant to this Exhibit E1 may not exceed five percent (5%). In the event that the calculation results in a calculated increase exceeding five percent (5%), the dollar amount exceeding five percent (5%) shall be applied to the following Rate Period and each subsequent Rate Period until any such excess is fully applied.

In the event that the index-based adjustment as calculated by this Exhibit E1 results in a negative Rate Adjustment Factor, the City reserves the right to “roll-under” the Rate reduction, such that there is no Rate adjustment in the Rate Period for which the negative Rate Adjustment Factor was calculated, but the calculated Rate reduction may be deferred to the following Rate Period, as a credit against future Rate increases.

2. Adjustment of Total Calculated Costs
The cost categories of the main components of Total Calculated Costs are presented in detail in Exhibit G1. Adjustments to these components to calculate costs for the coming Rate Period shall be calculated as follows:

A. Total Annual Cost of Operations

1. Labor-Related Costs. The Labor-Related Costs component of Total Calculated Costs for the then-current Rate Period is multiplied by one (1) plus the Annual Percentage Change in the ECI.
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EXHIBIT E1

MULTI-INDEX RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E1-2 Service Agreement, Exhibit E1 For example, in Rate Period Two when calculating the Labor-Related Costs for Rate Period Three, the Labor-Related Costs of Rate Period Two shall be multiplied by one plus the Annual Percentage change in the ECI.

2. Vehicle-Related Costs (excluding Fuel). The Vehicle-Related Costs component of Total Calculated Costs for the then-current Rate Period is multiplied by one plus the Annual Percentage Change in the Motor Vehicle Maintenance and Repair Index.

3. Fuel Costs. The Fuel Cost component of Total Calculated Costs for the then-current Rate Period is multiplied by one plus the Annual Percentage Change in the Fuel Index.

4. Other Costs. The Other Costs component of the Total Calculated Costs for the then-current Rate Period is multiplied by one plus the Annual Percentage Change in the CPI-U.

5. Direct Depreciation. Direct Depreciation is specified in the Table below by year for Rate Periods One through Ten. If the Agreement is extended beyond Rate Period Ten, direct depreciation shall be zero in any subsequent Rate Periods unless Parties mutually agree to a different amount.

Rate Year Vehicle
Depreciation
Container
Depreciation
Other
Depreciation
Rate Year 1
Rate Year 2
Rate Year 3
Rate Year 4
Rate Year 5
Rate Year 6
Rate Year 7
Rate Year 8
Rate Year 9
Rate Year 10

6. Allocated Costs (Labor, Vehicle, Fuel, and Other Costs). The Allocated Costs (Labor, Vehicle, Fuel, and Other Costs) component for the then-current Rate Period is multiplied by one plus the Annual Percentage Change in the CPI-U.

7. Allocated Depreciation and Start-Up Costs. The Allocated Depreciation and Start-Up Costs shall be ___________ ($_____) per year for Rate Period Two through Ten, and are not annually adjusted. These costs shall be zero for all subsequent Rate Periods unless Parties mutually agree to a different amount.

8. Total Annual Cost of Operations. The Total Annual Cost of Operations for the coming Rate Period equals the sum of the costs calculated in subsections (1) through (7) above. #6..
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EXHIBIT E1

MULTI-INDEX RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E1-3 Service Agreement, Exhibit E1 B. Profit. Profit for the coming Rate Period shall be calculated by dividing the Total Annual Cost of Operations for the coming Rate Period (the value calculated in Section 2.A.8 above) by an operating ratio (_____%) and subtracting from the result the Total Annual Cost of Operations for the coming year.

Profit =
Total Annual Cost of Operations
___for Coming Rate Period___
Operating Ratio
−
Total Annual Cost of Operations
for Coming Rate Period
C. Pass-Through Costs (Excluded from the Calculation of Profit)

1. Recyclable Materials Processing Costs. The Recyclable Materials Processing Costs shall be calculated as follows:

Recyclable Materials Processing Cost = [(Per-Ton Recyclable Materials Processing Cost for the then-current Rate Period - All regulatory fees identified on Form 7 of Exhibit G2 and included in the then-current per-Ton cost) x (1 + Annual Percentage Change in the CPI-U) + (Thencurrent per-Ton regulatory fees)] x (Total Tons of Recyclable Materials Collected for the mostrecently completed twelve- (12) month period).

2. Organic Materials Processing Costs – Commingled Yard Waste and Food Waste. The Organic Materials Processing Costs shall be calculated as follows:

Organic Materials Processing Costs = Per-Ton Organic Materials Processing fee at the Designated Organic Materials Processing Facility for the coming Rate Period x Total Tons of Organic Materials Collected for the most-recently completed twelve- (12) month period.

3. Disposal Costs. The Disposal Costs shall be calculated as follows:

Disposal Costs = Per-Ton Disposal fee at the Approved Disposal Facility (to be specified by the City) for the coming Rate Period x Total Tons of Solid Waste Collected for the most-recently completed twelve- (12) month period.

4. Interest Expense. The Interest Expense amount is ________________ ($____________) in Rate Period Two through Ten, is not annually adjusted, and shall be zero dollars ($0) in any subsequent Rate Period unless Parties mutually agree to a different amount.

5. Direct Lease Costs. The Direct Lease Costs amount is zero dollars ($0) in Rate Period Two through Ten, is not annually adjusted, and shall be zero dollars ($0) in any subsequent Rate Period unless Parties mutually agree to a different amount.

6. Allocated Lease Costs. The Allocated Lease Costs amount is ________________($___________) for Rate Period Two through Ten (including interest costs for Allocated General and Administrative of ________________($___________), Allocated Vehicle Maintenance costs of zero dollars ($0), and Allocated Container Maintenance of zero dollars ($0)) is not annually adjusted, and shall remain unadjusted in any subsequent Rate Period unless Parties mutually agree to a different amount.

Commented [JS5]: HF&H to update. Historical profit margin is

11.11% as previously provided.

Commented [BG6]: What method was used to calculate this #? Commented [PM7R7]: Placeholder. This will be updated
based on cost proposal
Commented [BG8]: What method was used to calculate this #? Commented [PM9R9]: Placeholder. This will be updated
based on cost proposal
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EXHIBIT E1

MULTI-INDEX RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E1-4 Service Agreement, Exhibit E1

7. Total Pass-Through Costs. Total Pass-Through Costs for the coming Rate Period are the sum of the amounts in subsections (1) through (6) above.

D. Total Calculated Costs before City Reimbursements/Fees/Payments. The Total Calculated Costs before City Reimbursements/Payments shall be the sum of the Total Annual Cost of Operations, Profit, and Total Pass-Through Costs for the coming Rate Period.

E. City Fees/Payments (Pass-Through Fees)

1. Franchise Fee. The Franchise Fees for the coming Rate Period shall equal the total Franchise Fees paid to the City in the most-recently completed twelve- (12) month period multiplied by one (1) plus the Annual Percentage Change in the CPI-U, or as otherwise directed by the City.

2. AB 939/SB 1383 Reimbursement. The AB 939/SB 1383 Reimbursement shall be calculated as follows:

AB 939/SB 1383 Reimbursement = (Per-account AB 939/SB 1383 Reimbursement for the thencurrent Rate Period) x (1 + Annual Percentage Change in the CPI-U) x (Total number of Customer accounts for the most-recently completed twelve- (12) month period).

3. Public Education Reimbursement. The Public Education Reimbursement for the coming Rate Period shall equal the total Public Education Reimbursement paid to the City in the mostrecently completed twelve- (12) month period multiplied by one (1) plus the Annual Percentage Change in the CPI-U, or as otherwise directed by the City.

4. Waste Generation and Characterization Reimbursement. The Waste Generation and Characterization Reimbursement for the coming Rate Period shall equal the total Waste Generation and Characterization Reimbursement paid to the City in the most-recently completed twelve- (12) month period multiplied by one (1) plus the Annual Percentage Change in the CPI-U, or as otherwise directed by the City.

5. Total City Reimbursements/Fees/Payments. The Total City Reimbursement/Payments for the coming Rate Period shall equal costs calculated in subsection (1) through (4) above; however, any adjustment in any such fee, whether pursuant to the relevant index or as the result of the decision of City, shall be pass-through fees (which are excluded from the calculation of profit) and reflected in the Total City Fees/Payments. In addition, County or State taxes, charges or fees shall be pass-through fees.

F. Other Adjustments. From time to time during the Term of the Agreement, it may be necessary to make other adjustments to the compensation calculations. For example, if the City elects to rollunder a negative Rate adjustment to a future year, the dollar value of that negative adjustment shall be reflected as an adjustment. In such case, the adjustment would be a reduction to the Total Calculated Costs.
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EXHIBIT E1

MULTI-INDEX RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E1-5 Service Agreement, Exhibit E1 G. Total Calculated Costs. The Total Calculated Costs for the coming Rate Period shall equal the sum of the Total Annual Cost of Operations, Profit, Total Pass-Through Costs, Total City Reimbursements/Payments, and Other Adjustments (if applicable), for the coming Rate Period.

3. Rate Adjustment Factor
The Rate Adjustment Factor shall equal the Total Calculated Costs for the coming Rate Period divided by the Total Calculated Costs for the then-current Rate Period, which shall be rounded to the nearest thousandth. Note that when determining the Rate Adjustment Factor for Rate Period Two, the Rate Adjustment Factor shall equal the Total Calculated Costs for Rate Period Two divided by the Total Proposed Costs of _____________ ($______) for Rate Period One.

4. Adjustment of Rates
Each then-current Rate shall be multiplied by the Rate Adjustment Factor to calculate the effective Rate for the coming Rate Period. The adjustment to each Rate shall be rounded to the nearest cent.

5. Other
If an index described in Exhibit E is discontinued, the successor index with which it is replaced shall be used for subsequent calculations. If no successor index is identified by the Bureau of Labor Statistics, the index published by the organization which is most comparable shall be used.

Commented [BG10]: Missing Information
Commented [PM11R11]: To be updated based on cost
proposal
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EXHIBIT E2:

COST-BASED RATE ADJUSTMENT METHODOLOGY
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-1 Service Agreement, Exhibit E2

1. General
The Parties shall use the cost-based Rate adjustment method described in this Exhibit in setting the Rates for Rate Periods Three (3) and Seven (7), and upon any extension of this Agreement pursuant to Section

2.2, including Rate Period Ten (10). The cost-based adjustment involves review of the Contractor’s actual cost of operations and operational statistics (staffing levels, routes, route hours, Customers and their Service Levels, etc.) to determine the Actual Allowable Total Annual Cost of Operations for the mostrecently completed Rate Period and to forecast the Total Contractor’s Compensation for the coming Rate Period. The difference (measured as a percentage) between the Total Contractor’s Compensation for the coming Rate Period and the Projected Gross Rate Revenues (which is calculated based on most-recent Customer subscription levels at then-current Rates) is the “Rate Adjustment Factor”. The Rate Adjustment Factor is applied to the then-current Rates to determine the Rates for the coming Rate Period. The City of Modesto also has an Agreement with Gilton Solid Waste Management, Inc.; The City will calculate the Rate Adjustment Factor under both Agreements at the same time and the lower of the two Rate Adjustment Factors will be applied to both Agreements to maintain the same Customer Rates Citywide.

The intent of performing the cost-based adjustment is to examine the actual impact of changes in inflation or deflation, the number of Customers, and the Service Level of Customers.

In the event that the cost-based adjustment calculated in accordance with this Exhibit E2 results in a negative Rate Adjustment Factor, the City reserves the right to “roll-under” the Rate reduction, such that there is no Rate adjustment in the Rate Period for which the negative Rate Adjustment Factor was calculated, but the calculated Rate reduction may be deferred to the following Rate Period, as a credit against future Rate increases.

A. Contractor’s Rate Application. Contractor’s Rate application for any Rate Period where Rates shall be adjusted using the cost-based methodology described in this Exhibit E2 and shall include the information described in this Section 1.A of Exhibit E2. With the exception of the information identified in Subsections 1, and 2 below, all other items listed may be requested by the City Contract Manager at any time during the Term of the Agreement and Contractor shall comply with that request in a timely fashion.

1. Financial Statements. Within one hundred fifty (150) calendar days after the close of the Contractor’s fiscal year, Contractor shall deliver to the City one (1) hard copy of the reviewed (or audited) consolidated financial statements of Contractor for the preceding fiscal year.

Financial statements shall include a supplemental combining schedule showing Contractor's results of operations, including the specific revenues and expenses in connection with the operations provided for in this Agreement separate from others included in such financial statements. The financial statements and footnotes shall be prepared in accordance with Generally Accepted Accounting Principles (GAAP) consistently applied and fairly reflecting the results of operation and Contractor’s financial condition. Annual financial statements shall be reviewed (or audited), in accordance with Generally Accepted Auditing Standards (GAAS) by a Certified Public Accountant (CPA) licensed (in good standing) to practice public accounting in the State as determined by the State Department of Consumer Affairs Board of #6..
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-2 Service Agreement, Exhibit E2 Accountancy, and that the CPA’s opinion on Contractor's annual financial statements shall be unqualified, and shall contain the CPA’s conclusions regarding the Contractor’s accounting policies and procedures, internal controls, and operating policies. The CPA shall perform an evaluation and, if necessary, shall cite recommendations for improvement.

2. Financial Schedule Reconciliation. Contractor shall provide a schedule which clearly and accurately ties the amounts shown in Contractor’s Rate application to Contractor’s financial schedules. Such schedule shall include any and all allocation factors and methodologies used to report cost and operating information for services provided to the City under this Agreement separately from Contractor obligations related to other public or private entities.

Such statement of reconciliation shall include:
a. General explanation of the various allocation methodologies used for each Rate application line item.
b. Specific examples of each type of allocation used showing how an entry is reported in the general ledger and ties to the Rate application.
c. Statement indicating whether there have been any changes in allocation methods used since the last Rate application. If any allocation methods have changed clearly identify those changes.

3. Operational Information.
a. Routes by Line of Business:

1. Number of routes per day.

2. Types of vehicles.

3. Crew size per route.

4. Number of full-time equivalent (FTE) routes.

5. Number of accounts and cubic yards scheduled per route.

6. Total route hours per Line of Business per year.

7. Average cost per route.
b. Personnel:

1. Organizational chart.

2. Job classifications and number of employees (e.g., administrative, Customer service representatives, drivers, supervisors, educational staff).

3. Wages by job classification.

4. Number of FTE positions for each job classification.

5. Number of hours per job classification per year.
c. Productivity Statistics:
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-3 Service Agreement, Exhibit E2

1. Average number of accounts per route per day by Line of Business.

2. Average number of set-outs per route per day by Line of Business.

3. Average Tons per route per day by vehicle type (i.e., side-loader, frontloader, roll-off).

4. Average cubic yards of Collection scheduled per route. d. Vehicles:

1. List of Collection vehicles including year purchased and mileage.

2. Average age of mobile equipment with oldest and newest. e. Operational Changes:

1. Number of routes.

2. Staffing.

3. Supervision.

4. Collection services.

4. Variance Analysis. Provide the following variance analysis for each Line of Business. For any variances greater than five percent (5%) annually, Contractor shall provide sufficient rationale to support variance:
a. Variance analysis comparing current Rate Period to each of the prior Rate Periods of Agreement.
b. Variance analysis comparing current Rate Period to each of the future projected Rate Periods.

5. Projections. Provide the following projection data:
a. Provide support for the basis for projected Gross Receipts and line item expenses.

Clearly indicate the supporting calculations and assumptions. b. Provide support for the most-recent twelve (12) months of Tonnage data for Rate Period ending June 30. Clearly indicate the supporting calculations and assumptions.

2. Forecasting Total Contractor’s Compensation
The Total Contractor’s Compensation for the coming Rate Period shall be forecasted in the manner described in this Section.

A. Forecasting Total Annual Cost of Operations.

1. Determine Actual Allowable Total Annual Cost of Operations. Contractor's financial statements, books, and records applicable to the services under this Agreement shall be #6..
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-4 Service Agreement, Exhibit E2 reviewed to determine Contractor's “Actual Allowable Total Annual Cost of Operations” for the most-recently completed Rate Period to perform all the services in the manner required by this Agreement for each of the following cost categories:
a. Actual labor-related costs.
b. Actual vehicle-related costs (excluding fuel and depreciation). c. Actual fuel costs.
d. Actual other costs (as defined on Form 6E of Exhibit G1). e. Direct depreciation costs (in the amount specified in Exhibit E1). f. Actual allocated costs (labor, vehicle, general and administrative, and other costs). g. Actual allocated costs (depreciation and start-up) (in the amount stated in Exhibit E1).

Financial statements provided by Contractor are considered confidential, Proprietary and/or Trade Secret information by Contractor and disclosure of this information shall be subject to the procedures outlined in Section 6.1.

2. Non-Allowable Costs. The following list of non-allowable costs shall be deducted from the Contractor’s actual costs when determining the Actual Allowable Total Annual Cost of Operations.
a. Labor, equipment, fuel, and start-up costs for personnel, vehicles, and facilities that are not specified in the cost forms contained in Exhibit G1 and/or which cannot be demonstrated to have been incurred as part of the performance of services under this Agreement.
b. Payments, including distribution and profit sharing, to directors and/or owners of Contractor unless the amount paid is reasonable compensation for services actually rendered. Reasonableness shall be determined based on available market pricing for similar services and shall be in the sole discretion of the City. In the instance of disagreement, Contractor’s Contract Manager shall meet and confer with the City Contract Manager in good faith to resolve differences of interpretation. c. Travel expenses and entertainment (above five thousand dollars ($5,000) annually in total) expenses, unless authorized in advance by the City. d. Payments to repair damage to public or private property for which Contractor is legally liable.
e. Fines or penalties of any nature.
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-5 Service Agreement, Exhibit E2 f. Liquidated Damages assessed under this Agreement.
g. Federal or State income taxes.
h. Cash donations or value of in-kind services provided to charitable, political, youth, civic, or other community organizations unless such donation has been previously approved in writing as an allowable expense by the City Contract Manager. i. Depreciation or interest expense for Collection vehicles, Containers, other equipment, offices and other facilities if such items are leased.
j. Attorney's fees and other expenses incurred by Contractor in any court proceeding in which the City and Contractor are adverse Parties.
k. Attorney's fees and other expenses incurred by Contractor arising from any act or omission in violation of this Agreement.
l. Attorneys' fees and other expenses incurred by Contractor in any court proceeding in which Contractor's own negligence, violation of law or regulation, or wrong doing are in issue and occasion, in whole or in part, the attorneys' fees and expenses claimed; and attorneys' fees and expenses incurred by Contractor in a court proceeding in which the legal theory or statute providing a basis of liability against Contractor also provides for separate potential liability for the City derived from the action of its citizens or Rate payers (such as in a CERCLA lawsuit) unless the Contractor is found not liable in such claims and such claims arise from acts or occurrences within the Term of the Agreement.
m. Payments to Related-Party Entities for products or services, in excess of the cost to the Related-Party Entities for those products or services.
n. Goodwill.
o. Replacement costs for Containers that need to be replaced because the useful life of such Container was less than the Term.
p. Administrative costs greater than the administrative costs presented in Contractor’s cost forms (Exhibit G1) adjusted annually by one (1) plus the Annual Percentage Change in the CPI-U.
q. Bad debt write-offs in excess of two percent (2%) of annual Rate revenues.

3. Forecast Total Annual Cost of Operations. Forecasted Total Annual Cost of Operations for the coming Rate Period shall be calculated based on Actual Allowed Total Cost of Operations for the most-recently completed Rate Period determined in accordance with this Exhibit E2, Sections 2.A.1 and 2.A.2 above. The forecasts shall be performed in the following manner:
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-6 Service Agreement, Exhibit E2 a. Forecasted labor-related costs shall be calculated for the coming Rate Period by the lesser of:
(i) multiplying the allowed labor-related costs, both direct and allocated, for the most-recently completed Rate Period by one plus the Annual Percentage Change in the ECI, and (ii) multiplying the result of step one once more by one plus the Annual Percentage Change in the ECI; OR,
The Labor-Related Costs component of Total Calculated Costs for the thencurrent Rate Period is multiplied by one plus the Annual Percentage Change in the ECI.
b. Forecasted vehicle-related costs (excluding fuel and depreciation costs) shall be calculated for the coming Rate Period by (i) multiplying the allowed vehicle-related costs, both direct and allocated, for the most-recently completed Rate Period by one (1) plus the Annual Percentage Change in the Motor Vehicle Maintenance and Repair Index, and (ii) multiplying the result of step one (1) once more by one (1) plus the Annual Percentage Change in the Motor Vehicle Maintenance and Repair Index. c. Forecasted fuel costs shall be calculated for the coming Rate Period by (i) multiplying the allowed fuel costs, both direct and allocated, for the most-recently completed Rate Period by one (1) plus the Annual Percentage Change in the Fuel Index, and (ii) multiplying the result of step one (1) once more by one (1) plus the Annual Percentage Change in the Fuel Index.
d. Forecasted other costs shall be calculated for the coming Rate Period by (i) multiplying the allowed other-related costs, both direct and allocated, for the most-recently completed Rate Period by one (1) plus the Annual Percentage Change in CPI-U, and (ii) multiplying the result of step one (1) once more by one (1) plus the Annual Percentage Change in the CPI-U.
e. Forecasted direct depreciation expense shall be the amount specified in Section 2.A.5 of Exhibit E1 for vehicles, Containers, and facilities. Direct depreciation expense is a fixed cost and is not subject to inflation.
f. Forecasted allocated labor-related, vehicle-related, general and administrative, and other costs shall be calculated for the coming Rate Period by (i) multiplying the allowed other-related costs for most-recently completed Rate Period by one (1) plus the Annual Percentage Change in CPI-U, and (ii) multiplying the result of step one (1) once more by one (1) plus the Annual Percentage Change in CPI-U.
g. Forecasted allocated depreciation and start-up expense shall be the amount specified in Section 2.A.7 of Exhibit E1 for vehicles, Containers, and facilities. #6..
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-7 Service Agreement, Exhibit E2 h. Forecasted Total Annual Cost of Operations for the coming Rate Period shall equal the sum of the following costs, which shall have been calculated in accordance with the procedures in this Exhibit E2:
(1) Forecasted labor-related costs.
(2) Forecasted vehicle-related costs (excluding fuel and depreciation costs). (3) Forecasted fuel costs.
(4) Forecasted other costs.
(5) Forecasted direct depreciation expense.
(6) Forecasted allocated labor-related, vehicle-related, general and administrative, and other costs.
(7) Forecasted allocated costs for depreciation and start-up.

B. Forecast Profit. Contractor shall be entitled to Profit on Forecasted Total Annual Cost of Operations.

Profit shall be calculated using an operating ratio as described in Exhibit E1, Section 2.Profit shall be calculated using the following formula:

Profit = (Forecasted Total Annual Cost of Operations / Operating Ratio) – Forecasted Total Annual Cost of Operations
For example:

1. Assuming an operating ratio of ninety-two (92%)

2. Assuming a Forecasted Total Annual Cost of Operations of $1,000,000

3. Profit = ($1,000,000 / 0.92) – $1,000,000 = $86,956.52 C. Forecast Pass-Through Costs. Pass-Through Costs for the coming Rate Period shall be forecasted in the following manner:

1. Forecasted Recyclable Materials Processing costs shall be calculated in the manner described in Section 2.C.1 of Exhibit E1.

2. Forecasted Organic Materials (Commingled Yard Waste and Food Waste) Processing costs shall be calculated in the manner described in Section 2.C.2 of Exhibit E1.

3. Forecasted Disposal costs shall be calculated in the manner described in Section 2.C.3 of Exhibit E1.

4. Forecasted Interest Expense shall be calculated in the manner described in Section 2.C.4 of Exhibit E1.

Commented [JS12]: HF&H to update
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EXHIBIT E2

COST BASED RATE ADJUSTMENT METHODOLOGY
January 27, 2026 Page E2-8 Service Agreement, Exhibit E2

5. Forecasted Direct Lease Costs shall be calculated in the manner described in Section 2.C.5 of Exhibit E1.

6. Forecasted Allocated Lease Costs shall be calculated in the manner described in Section 2.C.6 of Exhibit E1.

D. Forecast City Fees/Payments. City fees shall be calculated in the manner described in Section 2.E of Exhibit E1.

3. Projected Gross Rate Revenue
Projected Gross Rate Revenue at then-current Rates shall reflect projected annual Gross Rate Revenues from all Customers based on then-current Rates and then-current Customer Service Levels, inclusive of all Rates and special charges authorized under this Agreement. For the purposes of determining Customer Service Levels for on-call services (e.g., Roll-Off Box service provided less than weekly, Bin rentals, etc.) and special charges (e.g., push charges, lock/unlock charges, etc.), the prior twelve (12) months of billing activity for such services and special charges shall be used.

4. Rate Adjustment Factor
The Rate Adjustment Factor shall equal the Forecasted Total Calculated Costs for the coming Rate Period, calculated in accordance with Section 2 herein, divided by the Projected Gross Rate Revenues. The City of Modesto also has an Agreement with Gilton Solid Waste Management Inc.; The City will calculate the Rate Adjustment Factor under both Agreements at the same time and the lower of the two Rate Adjustment Factors will be applied to both Agreements to maintain the same Customer Rates Citywide. The Rate Adjustment Factor shall be rounded to the nearest thousandth.

5. Adjustment of Rates
Each then-current Rate shall be multiplied by the Rate Adjustment Factor to calculate the effective Rate for the coming Rate Period
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EXHIBIT F:

PERFORMANCE STANDARDS AND LIQUIDATED

DAMAGES
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-1 Service Agreement, Exhibit F
The City hereby establishes specific standards of performance under the Agreement in each of the six (6) “Performance Areas” listed below. The City Contract Manager may monitor Contractor’s performance in each of those areas based on the “Specific Performance Measures” within that Performance Area. In the event that the City Contract Manager determines that Contractor has failed to meet the performance standard established for any Specific Performance Measure, the City may assess Liquidated Damages pursuant to Section 10.5 of the Agreement. Liquidated Damages, if assessed, shall only be assessed for the number of events, Days, or other measure in excess of the Acceptable Performance Level.

1. Performance Area: Provision of Universal Three- (3-) Container Service Item
Specific Performance
Measure Definition
Acceptable
Performance
Level
Liquidated Damage
Amount

1. Failure to provide
Recyclable Materials,
Organic Materials, and
Garbage Collection Services
to every Customer.

For each occurrence of
failing to provide Customers
with the three- (3-)
Container system, including
Recyclable Material, Organic
Materials, and Garbage,
required by and compliant
with Article 4 and Exhibit B.

No acceptable
failure level
$100/Residential
Customer per
occurrence
$500/Commercial
Customer per
occurrence
The City shall not assess Liquidated Damages Item 1, above, under the following circumstances:

A. Contractor documents that Customer is compliant with Recyclable Materials and Organic Waste waiver requirements pursuant to Municipal Code Section 5-5.116-117 and 14 CCR Division 7, Article 12, Article 7.

B. Contractor documents that Customer is approved by the City to share Recyclable Materials, Organic Materials Collection, and/or Garbage services with another Customer.

C. Contractor notifies the City that Contractor has attempted to provide Recyclable Material and/or Organic Material Collection services to the Customer and that the Customer fails or refuses to subscribe to such service.
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-2 Service Agreement, Exhibit F

2. Performance Area: Service Quality and Reliability
Item
Specific Performance
Measure Definition
Acceptable
Performanc
e Level
Liquidated Damage
Amount

1. Missed Collections. Each Service Opportunity
where Contractor fails to
Collect a Container from a
Customer who properly
placed said Container for
Collection, as described in
Subsection 4.12.3, unless
Contractor follows the
protocols as required in the
Agreement.

Less than ten
(10) per one
thousand
(1,000)
Service
Opportunities
$100/Occurrence

2. Failure to Collect illegally
dumped items and provide
photographic evidence.

Failure to Collect illegally
dumped items and provide
photographic evidence of
Collection in accordance with
Section 4.10.

Less than (1)
per one
hundred
(100) missed
Collections
$100/Occurrence

3. Failure exchange Customer
Container.

Failure to exchange
Customer Container within
the required time specified
in Section 5.6.

Less than ten
(10) per one
hundred
(100)
Customer
requests
received
$100/Occurrence

4. Failure to Notify the City
Contract Manager of
spillage.

Each occurrence of failure by
Contractor to notify the City
and appropriate authorities
(if necessary) within one (1)
Business Day of becoming
aware of spillage, including
any fluids spilled or leaked
from a Container or
Collection vehicle prior to
leaving the Collection
location.

No
acceptable
failure level
$500/Occurrence

5. Failure to clean up spillage
from Collection of a
Container.

Each occurrence of failure by
Contractor to clean up any
items or materials spilled
during the Collection of a
Container.

Less than five
(5) per one
thousand
(1,000)
Service
Opportunities
$1,000/Event
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-3 Service Agreement, Exhibit F
Item
Specific Performance
Measure Definition
Acceptable
Performanc
e Level
Liquidated Damage
Amount

6. Failure to clean up spillage
from Collection vehicle.

Each occurrence of failure by
Contractor to clean up any
fluids spilled or leaked from
Collection vehicle prior to
leaving the Collection
location.

Less than five
(5) per one
thousand
(1,000)
Service
Opportunities
$1,000/Event

7. Damage to property. Each event of damage to
either public or private
property as a result of
Collection activity, including,
without limitation, Curbs,
sidewalks, vehicles,
landscapes, Container
Enclosures and gates, signs,
light fixtures, and overhead
wires and cables, that is
uncorrected within ten (10)
Business Days. If Contractor
cannot reasonably correct or
remedy the breach within
the time set forth in a notice
of violation, it shall not be in
breach if it commences to
correct or remedy such
violation within the time set
forth in such notice and
diligently effects such
correction or remedy
thereafter.

Less than two
(2) per one
thousand
(1,000)
Service
Opportunities
$200/Event and actual
cost of repair to the
City’s satisfaction.

8. Failure to maintain
equipment.

Each event of failure to
maintain equipment,
including vehicles, Carts,
Bins, and other Containers,
in a clean, safe, and sanitary
manner.

No
acceptable
failure level
$100/Item/Day

9. Failure to comply with
Container requirements.

Failure to comply with
Container labeling and colors
as specified in Section 5.6.

No
acceptable
failure level
$200/Container/
Occurrence
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-4 Service Agreement, Exhibit F
Item
Specific Performance
Measure Definition
Acceptable
Performanc
e Level
Liquidated Damage
Amount

10. Discourteous behavior. For each occurrence of
uncustomary discourteous
behavior of Contractor’s
employees to a Customer or
City employee. The City’s
Contract Manager shall meet
and confer in good faith with
the Contractor’s Contract
Manager to determine
whether the employee’s
actions constitute
uncustomary or discourteous
behavior that is inconsistent
with professional conduct.

Less than five
(5) per one
thousand
(1,000)
Service
Opportunities
$250/Event

11. Failure to complete route
and/or failure to notify the
City Contract Manager of
failure to complete route.

Failure or neglect to
complete at least ninety
percent (90%) of each route
on the regular scheduled
Collection service Working
Day.

No
acceptable
failure level
$1,000/Route

12. Uncovered loads. Failure to properly cover
materials in Collection
vehicles.

No
acceptable
failure level
$500/Event

13. Failure to cure in a timely
manner.

Failure to cure noncompliance with the
provisions of this Agreement
in the manner and time set
forth in Section 10.2.

No
acceptable
failure level
$150/Incident/Day

14. Failure to adjust Service
Level.

Failure to implement a
Service Level adjustment for
a Customer that has been
requested by the Customer
or the City Contract Manager
within five (5) Business Days
of such request.

No
acceptable
failure level
Any actual pro-rated
Rate savings due to
Customer plus;
$50/Container/Day

15. Failure to perform other
requirement.

Each failure to perform any
obligation of the Agreement
not specifically stated above.

No
acceptable
failure level
$100/Event
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-5 Service Agreement, Exhibit F

3. Performance Area: Customer Service
Item
Specific Performance
Measure Definition
Acceptable
Performanc
e Level
Liquidated Damage
Amount

1. Failure to commence
service.

Any failure by Contractor to
deliver a Container and begin
providing Collection to a
Customer, at the Service
Level requested by said
Customer, within five (5)
calendar Days of receiving
such request. This may
include a new Customer
receiving new service or an
existing Customer requesting
a change in or addition to
existing Service Levels.

Less than one
(1) per one
hundred
(100) Service
Requests
$100/Occurrence

2. Failure to resolve Complaint. Any failure or neglect by Contractor to resolve each
Complaint within the time
set forth in this Agreement.

Less than one
(1) per one
hundred
(100)
Complaints
$100/Event

3. Failure to answer phones. Any failure by Contractor to answer a telephone call from
a Customer during normal
business hours. A call is not
considered to be answered if
the Customer does not speak
with a live operator. (A call is
considered to be answered if
the Customer hangs up or
abandons the call following a
hold time of less than three
(3) minutes.) Any failure to
have a Customer service
representative answer a
phone call within a two (2)
minute average for any
month and/or for each single
caller having to wait more
than ten (10) minutes,
except where such failure
results from unavoidable
issues such as system failure.

Less than five
(5) per one
thousand
(1,000) Calls
received
under this
Agreement
$50/Event

4. Failure to maintain office
hours.

Failure to maintain office
hours as required by this
Agreement.

No
acceptable
failure level
$100/Event
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-6 Service Agreement, Exhibit F
Item
Specific Performance
Measure Definition
Acceptable
Performanc
e Level
Liquidated Damage
Amount

5. Provision of inaccurate
information
Each event of a Customer
service representative
providing inaccurate
information in response to a
Customer question or
Complaint, after written
warning and verifiable
evidence.

No
acceptable
failure level
$50/Event

6. Unauthorized hours of
operation.

Each occurrence of
Contractor Collecting from
Customers during
unauthorized hours.

Less than two
(2) per one
thousand
(1,000)
Service
Opportunities
$50/Event

7. Failure to conduct
contamination monitoring.

Failure to conduct
contamination monitoring as
required by this Agreement.

No
acceptable
failure level
$150/Audit/Day
8 Failure to issue
contamination notices.

Failure to issue
contamination notices as
required by this Agreement.

No
acceptable
failure level
$500/Route/Day

9. Failure to maintain website. Failure for Contractor to maintain an updated website
with City-specific
information.

No
acceptable
failure
$250/Day

10. Failure to provide multilingual Customer service.Failure for Contractor to provide multi-lingual
Customer service as required
by the Agreement.

No
acceptable
failure
$500/Day or part
thereof

11. Failure to perform other
requirement.

Each failure to perform any
obligation of the Agreement
not specifically stated above.

No
acceptable
failure level
$100/Event
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-7 Service Agreement, Exhibit F

4. Performance Area: Diversion
Item
Specific Performance
Measure Definition
Acceptable
Performance
Level
Liquidated Damage
Amount

1. Failure to meet the
minimum Diversion
requirements (Section

5.11)
Failure to meet the
minimum Diversion
requirements of this
Agreement (calculated
per calendar year).

Less than

0.001%
Shortfall of

0.001% - 2%: $10,000.00 per
calendar year.

Shortfall of

2.001% - 4%: $25,000.00 per
calendar year.

4.001% - 6%: $50,000.00 per
calendar year.

6.001% or greater:
$100,000.00 per calendar
year.

2. Failure to provide Cityapproved education and
outreach materials
Each occurrence by
Contractor of
distributing non-Cityapproved education or
outreach materials.

No acceptable
failure level
$500/Occurrence

5. Performance Area: Facilities
Item
Specific Performance
Measure Definition
Acceptable
Performance
Level
Liquidated
Damage
Amount

1. Delivery to non-Approved
Facility.

Each individual occurrence of
delivering materials to a facility
other than the Approved Facility
designated for each material type
under Article 4 of this
Agreement.

No acceptable
failure level
$2,500 / Load for
first failure
$5,000/Load each
subsequent
failure.

2. Disposal of targeted
Diversion Materials.

Each individual occurrence of
delivering Recyclable Materials or
Organic Materials set out for
Collection by Customer for
Disposal rather than Processing,
regardless of a facility closing for
any reason.

No acceptable
failure level
$1,000/Load
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-8 Service Agreement, Exhibit F
Item
Specific Performance
Measure Definition
Acceptable
Performance
Level
Liquidated
Damage
Amount

3. Mixing materials during
Collection.

Each individual Container that is
Collected by Contractor in a
vehicle (or vehicle compartment,
in split-body vehicles) intended
or designated for the purpose of
Collecting a different material
type (e.g., Recyclable Materials
Collected in Garbage vehicle,
Garbage Collected in Organic
Materials vehicle, etc.)
No acceptable
failure level
$1,000/
Container
Not to exceed
$10,000/Route/
Day

4. Commingling with nonCity materials.Commingling of materials Collected inside and outside the
City during Collection.

No acceptable
failure level
$1,000/Event

5. Failure to provide
adequate capacity.

Failure to provide adequate
primary and alternate capacity to
accept and Process Recyclable
Materials.

No acceptable
failure level
$1,000/Day

6. Performance Area: Reporting & Records
Item
Specific
Performance
Measure Definition
Acceptable
Performance
Level
Liquidated
Damage
Amount

1. Late report. Each occurrence of a report, as
required under Exhibit D to this
Agreement, submitted after the due
date, unless City-approved exemption
was granted. Reports shall be
considered late until they are
submitted in a complete and accurate
format.

No acceptable
failure level
$250/Report/ Day

2. Failure to maintain or
provide access to
records.

Each occurrence of the City Contract
Manager requesting information
required to be maintained by
Contractor where Contractor fails to
provide such information within the
time window specified in this
Agreement.

No acceptable
failure level
$500/occurrence

3. Misleading/
inaccurate reporting.

Each occurrence of Contractor
providing materially inaccurate or
intentionally misleading information
or reporting to the City under or in
regard to this Agreement.

No acceptable
failure level
$250/occurrence
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-9 Service Agreement, Exhibit F
Item
Specific
Performance
Measure Definition
Acceptable
Performance
Level
Liquidated
Damage
Amount

4. Failure to correct
submittal of
inaccurate data in a
timely manner.

Failure to correct submittal of
inaccurate data within three (3)
Business Days (or such other time
period as may be agreed to in writing
between the City and Contractor) of
notification by the City.

No acceptable
failure level
$500/Day

5. Failure to submit any
report not otherwise
described herein
(Section 6.2).

Failure to submit any report not
otherwise described herein within the
mutually agreed-upon timeframe
established at the time of City
request.

No acceptable
failure level
$100/Occurrence
/Day

6. Failure to bill
Customers
accurately.

Each Complaint received where
Contractor billed a Customer in error,
and such error is not corrected within
seven (7) Days of notification of such
error by Customer. Inaccurate billing
may include either over- or undercharging of the Customer relative to the approved Rates for services.

Less than one (1)
per one
thousand (1,000)
bills issued
$100/Occurrence
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EXHIBIT F

PERFORMANCE STANDARDS & LIQUIDATED DAMAGES
January 27, 2026 Page F-10 Service Agreement, Exhibit F By placing designee’s initials at the places provided, each Party specifically confirms the accuracy of the statements made above and the fact that each Party has had ample opportunity to consult with legal counsel and obtain an explanation of Liquidated Damage provisions at the time that the Agreement was made.

Contractor City
Initial Here: _________ Initial Here: _________
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EXHIBIT G:

CONTRACTOR’S COST BASIS AND INITIAL RATES
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EXHIBIT G1:

COST BASIS FOR RATES Commented [SP13]: Note to City: To be included with Final Agreement.
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EXHIBIT G2:

INITIAL RATES FOR COLLECTION SERVICES Commented [SP14]: Note to City: To be included with Final Agreement.
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EXHIBIT H:

APPROVED RECYCLABLE MATERIALS PROCESSING
FACILITY LOAD REJECTION STANDARDS Commented [SP15]: Note to City: This would apply to the Approved Recyclable Materials Processing Facility Only and to be included with Final Agreement.
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EXHIBIT I:

APPROVED AFFILIATES AND SUBCONTRACTORS
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EXHIBIT I

APPROVED AFFILIATES AND SUBCONTRACTORS
January 27, 2026 Page I-1 Service Agreement, Exhibit I
In accordance with Section 3.3 of the Agreement, the City has approved the following facilities, Affiliates, and Subcontractors to manage the specified services listed below and assist Contractor in the performance of the requirements of this Agreement.

Approved Facilities, Affiliates, or Subcontractor Services #6..
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EXHIBIT J:

SERVICE AREA MAPS
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EXHIBIT J

SERVICE AREA MAPS
January 27, 2026 Page J-1 Service Agreement, Exhibit J
The City designates the Service Area within which the Contractor is authorized to Collect and Transport Discarded Materials within the City. The Contractor shall not Collect or handle Discarded Materials within the City outside the limits of the Service Area granted under this Agreement. The City reserves the right to modify the designated Service Area at any time if such modifications are determined to be in the public interest and necessary for the efficient administration of this Agreement. In the event of any such modifications, including the annexation of new territories, the City Contract Manager shall review the changes, and such areas may be made subject to the terms of this Agreement, as determined and approved by the City. Determining which City collector serves the annexed areas will depend on which collector serviced the area prior to annexation. If an area was served by a current City collector prior to annexation, under a non-City agreement, then the area shall be served by the current City collector under this Agreement. If prior to annexation the area was served by a non-City collector, the City shall determine which current City collector will service the area.

Figure 1: City of Modesto Hauler Service Areas
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EXHIBIT J

SERVICE AREA MAPS
January 27, 2026 Page J-2 Service Agreement, Exhibit J
Figure 2: Contractor Service Area
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARASSMENT
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-1 Service Agreement, Exhibit K

1. Anti-Discrimination
A. During the performance of this Agreement, Contractor and any allowed Subcontractors shall not unlawfully discriminate against any employee or applicant for employment because of race, color, ancestry, religion, sex, national origin, marital status, age, medical condition (cancer related), physical handicap (including AIDS), sexual orientation, or any other basis prohibited by Federal or California law.

B. Equal employment opportunity extends, but is not limited to recruitment, compensation, benefits, layoffs, termination, and all other conditions of employment. The Contractor and any allowed Subcontractors shall ensure that the evaluation and treatment of their employees and applicants for employment are free of such discrimination. The Contractor and any allowed Subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Government Code, Section 12900 et seq.) and the applicable regulations promulgated thereunder (California Administrative Code, Title 2, and Section 7285.0 et seq.). The applicable regulations of the Fair Employment and Housing Commission implementing Government Code, Section 12900, set forth in Chapter 5 of Division 4 of Title 2 of the California Administrative Code are incorporated into this contract by reference and made a part hereof as if set forth in full.

C. The Contractor and any allowed Subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement.

D. The Contractor shall include the anti-discrimination and compliance provisions of this clause in any allowed subcontracts to perform services.

E. The Contractor shall permit access by representatives of the Department of Fair Employment and Housing and the City upon reasonable notice at any time during the normal business hours, but in no case less than twenty-four (24) hours notice, to such of its books, records, accounts, other sources of information and its facilities as said Department or City shall require to ascertain compliance with this Agreement.

F. By executing this Agreement, Contractor certifies that it shall follow and be in compliance with the Americans with Disabilities Act of 1990, the applicable administrative requirements promulgated in response thereto, and any other applicable Federal laws and regulations relating to handicap discrimination and participation and will continue to do so for at least the duration of the Agreement and any extensions thereof.

2. Anti-Harassment
A. Anti-Harassment consists of any conduct affecting another person because of his or her race, religion, color, national origin, ancestry, physical or mental disability, medical condition, genetic characteristics or information, medical and family leave, marital status, sexual orientations, gender, gender identity, gender expression, pregnancy, child birth, political affiliation, age, or any other category or attribute identified under State and Federal law when such conduct has the purpose or the effect of:
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-2 Service Agreement, Exhibit K

1. Creating an intimidating, hostile, or offensive work environment.

2. Unreasonably interfering with the employee’s or non-employee’s work performance.

3. Otherwise adversely affecting an employee’s or non-employee’s employment opportunities.

B. Harassment may take many forms, including but not limited to, the following examples:

1. Verbal Harassment: Epithets, derogatory and offensive comments or slurs based on race, religion, color, national origin, ancestry, physical or mental disability, marital status, pregnancy, age, job experience, job position, or any other category or attribute identified under state and federal law.

2. Physical Harassment: Assault, impeding or blocking movement that results in the physical interference with normal work or movement on the basis of race, religion, color, national origin, ancestry, physical or mental disability, marital status, pregnancy, medical condition, gender, sexual orientation, political affiliation, age, or any other category or attribute identifies under state and federal law.

3. Visual Harassment: The displaying of posters, photography, notices, bulletins, emails, cartoons or drawings with derogatory and offensive content based on race, religion, color, national origin, ancestry, physical or mental status, pregnancy, medical, condition, gender, sexual orientation, political affiliation, age, or any other category or attribute identified under state and federal law.

4. Sexual Harassment: As defined by law as unwanted sexual advances. Request for sexual favors or visual, verbiage or physical conducts of a sexual nature when:
a. Submission to such conduct is made a term or condition of employment; or b. Submission to or rejection of suck conduct is used as a basis for employment decisions affecting the individual; or
c. Such conduct has the purpose or effect of unreasonably interfering with an employees or non-employee’s work performance or creating an intimidation, hostile or offensive working environment because of the persistent, severe or pervasive nature of the conduct.

C. Examples of Sexual Harassment include, but are not limited to the following:

1. Unwelcome sexual overtures or propositions

2. Offering employment benefits or status in exchange for sexual favors.

3. Making or threatening retaliation after a negative response to sexual advances. #6..
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-3 Service Agreement, Exhibit K

4. Visual conduct such as using epithets or slurs, telling sexually explicit jocks, or making derogatory or suggestive comments about a person’s body or dress.

5. Written communications of a sexual nature distributed in hard copy, soft copy or via a computer network.

6. Verbal abuse of sexual nature, graphic verbal commentary about an individual’s body, sexually degrading words to describe an individual, suggestive or obscene letters, notes of invitations.

7. Physical conduct such as touching, assaulting, impeding or blocking movements.

D. Reporting and Complaint Procedures

1. Immediate Action Required
City staff will immediately report any discrimination or harassment claims. The report will be provided to the Contractor via email or official letter. A copy of this claim will be provided to the City Manager or his/her designee.
a. Employee’s and Non-Employee’s Responsibilities when subjected to discrimination and/or harassment:
i. Employees or non-employees who believe they have been subjected to discrimination or harassment, or are aware of discrimination or harassment against others, shall report the situation immediately to his/her supervisor or manager, except as specified in subsection (b), below. Employees and nonemployees shall report any such incidents occurring in the workplace, whether committed by coworkers, supervisors or managers, or third persons doing business with the City, such as customers or vendors, or other non-employees. If comfortable doing so, an employee or non-employee who has a complaint of discrimination or harassment is encouraged to directly inform the person(s) engaging in the behavior that such conduct is offensive and insist the behavior to stop.
ii. Employees and non-employees must immediately contact a supervisor or manager to register a complaint of discrimination or harassment, unless that supervisor or manager is the individual engaging in the unwanted behavior. In that case, the employee or non-employee may contact someone at the next supervisory level. If the employee or non-employee feels uncomfortable dealing directly with his or her immediate supervisor or manager, he or she may contact the department head, or the Director of Human Resources (or either of their designees) to register a complaint of discrimination or harassment. iii. Employees and non-employees may file a formal complaint of harassment or discrimination with their department head or with Human Resources. To assist the City in conducting a thorough investigation, complaints shall be submitted in #6..
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-4 Service Agreement, Exhibit K
writing and shall include specific details of the incident(s), the names of the individuals involved, the names of any witnesses, and any documentary evidence (notes, pictures, cartoons, etc.) that will corroborate the allegations. iv. Employees and non-employees shall immediately report any retaliation to a supervisor, manager, department head, or Director of Human Resources (or designee). All retaliation complaints shall be immediately, objectively, and thoroughly investigated in accordance with the investigation procedures. If a report of retaliation is substantiated, appropriate disciplinary action, up to and including discharge shall be taken.
b. Supervisor’s or Manager’s responsibilities to eliminate discrimination and/or harassment:
i. A supervisor or manager is responsible for enforcing the City’s discrimination and harassment policy. Supervisors or managers must ensure that all employees and non-employees are aware of the City’s policy through open discussion of the policy at staff meetings and by posting the policy in a conspicuous location accessible to all staff members.
ii. A supervisor or manager shall be cognizant of employees’ and non-employees’ behavior and shall not permit any employee or non-employee under their supervision to be subjected to or engage in any conduct prohibited by this policy. iii. A supervisor or manager who observes conduct prohibited by this policy shall immediately direct the employee or non-employee to cease the conduct. iv. A supervisor or manager who receives a complaint of prohibited conduct is required to take the complainant seriously, and report the matter immediately to the department head; be supportive of the complainant; ensure there is no retaliation against the complainant; conduct an internal fact-finding review into the allegations; obtain as much detailed information as possible; thoroughly document the findings; communicate in written form to the parties and resolution of the complaint; and report to and consult with the Human Resources Department promptly, without delay.

2. Confidentiality. The City will make every effort to protect the privacy and confidentiality of all parties involved, as well as any information and/or documentation obtained, to the extent possible consistent with a thorough investigation.

3. Penalty for Non-Compliance. The City shall take disciplinary action, up to and including discharge, against any supervisor or manager who fails in his/her responsibility to take immediate action in response to an employee’s or non-employee’s complaint of discrimination or harassment. Further, such disciplinary action shall be taken against a supervisor or manager who fails to stop discriminatory or harassing conduct committed in his/her presence or to stop such conduct about which the supervisor or manager has knowledge. #6..
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-5 Service Agreement, Exhibit K
E. Investigation Procedures

1. Determination of Responsibility for Investigation
If a formal complaint is filed with the department head or the Director of Human Resources (or either of their designees), the department head and the Director of Human Resources shall consult with one another to determine whether the department or Human Resources shall conduct the fact-finding investigation into the allegations. Either the department head or the Director of Human Resources (or either of their designees), depending on who is responsible for the investigation, shall issue written notification to the complainant and alleged harasser(s). The notification shall specify the nature of the complaint and inform the parties that an investigation into the allegations of discrimination and/or harassment shall be conducted.

2. Investigative Guidelines
The investigation shall include the following steps taken in the order best suited to the circumstances:
a. Identify and preserve the evidence.
b. Confirm the name and position of the complainant.
c. Interview the complainant.
d. Allow the complainant the opportunity to place the complaint in writing. e. Obtain the identity of the alleged harasser(s).
f. Obtain as many details as possible regarding the incident(s) that prompted the complaint, including the number of occurrences, dates, times, locations, and witnesses (if applicable).
g. Ascertain how the complainant felt about the alleged incident when it occurred; complainant’s response(s) to the alleged behavior; and witness statements (if applicable). h. Ascertain if any threats or promises were made in connection with the alleged harassment.
i. Ascertain if the complainant knows of or suspects that there are other victims of harassment by the same person(s).
j. Ascertain whether the complainant has spoken to anyone, especially supervisors, about the harassment.
k. Ascertain what resolution would be acceptable to the complainant. #6..
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-6 Service Agreement, Exhibit K
l. Interview the alleged harasser to get his or her side of the story, including any possible motivation for a false allegation.
m. Interview witnesses who were identified by the complainant regarding the alleged harasser or other persons identified during the investigation. n. Interview witnesses who were identified by the alleged harasser or other persons identified during the investigation.
o. Advise all participants that the investigation is “confidential” and no to engage in any retaliatory conduct, as such conduct is subject to disciplinary action up to and including discharge. Confidentiality will be maintained to the extent possible. An individual who is interviewed during the course of an investigation is prohibited from discussing the substance of the interview, except as otherwise directed by a supervisor or the Director of Human Resources. Any individual who discusses the content of an investigatory interview will be subject to discipline or other appropriate sanction. p. Conduct follow-up interviews, if warranted.
q. Prepare report on findings and discuss with management and designated legal staff.

F. Responding to the Complaint

1. Following the completion of the fact-finding investigation, either the department head or the Director of Human Resources (or either of their designees), depending on who is responsible for the investigation, shall make a report of findings, along with a recommendation regarding the appropriate remedial action to be taken, if warranted. The recommendation shall be made after reviewing the findings of the investigation, giving consideration to all factual information, the nature of the alleged conduct, and the totality of the circumstances. If the investigation was conducted by the Director of Human Resources, or designee, the Director, or designee, shall confer with the affected department head and both shall concur on the remedial action to be taken, if any. If the investigation was conducted by the department head, the department head shall confer with the Director of Human Resources prior to making the report of findings and both shall concur on the remedial action to be taken, if any.

2. If either the department head or the Director of Human Resources does not concur with the findings and recommendations of the other, the City Attorney (or designee) shall review and resolve the matter in dispute.

3. Report of findings and recommendation shall be treated as a confidential document and no other distribution shall be made without first consulting with the City Attorney’s office. A completed investigation report will not be disclosed, except as it is deemed necessary to support a disciplinary action, to take remedial action, to defend the City in adversarial proceedings, or to comply with the law or court order.
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-7 Service Agreement, Exhibit K

4. Either the department head or the Director of Human Resources (or either or their designees), depending on who is responsible for the investigation, shall provide a written response to the complainant and the person alleged to have committed the misconduct, discrimination, and/or harassment. The response shall include a copy of the City’s discrimination and harassment policy and a memorandum indicating the City’s determination as to whether the complaint is:
a. Unsustained: The investigation failed to disclose sufficient evidence to substantiate the allegation(s).
b. Unfounded: The investigation proved that the act(s) or omission(s) complained of did not occur. The finding also applies when the individual employee(s) named in the complaint were not involved in the act(s) or omission(s) alleged. c. Sustained: The investigation disclosed sufficient evidence to substantiate the allegation(s) made in the complaint; appropriate action will be taken.

5. Details regarding any specific fact-findings or disciplinary action to be taken will not be communicated to the complainant. The City Attorney shall review the response for legal sufficiency before dissemination.

6. The City shall close and retain the investigation file, in accordance with Applicable Law(s), regulations, and City policy regarding retention of City records.

G. Discipline
Disciplinary action imposed as a result of any investigation conducted pursuant to this policy shall be commensurate with the severity of the offense, up to and including discharge, even for a first offense.

H. Alternative Remedies
If upon exhausting all internal remedies to file, investigate, and respond to charges of discrimination/harassment, pursuant to title VII of the Federal Civil Rights Act of 1964 (42 U.S.C §§ 2000e et seq.), any person has a right to file a charge of discrimination/harassment with the Equal Employment Opportunity Commission (“EEOC”). In addition, pursuant to the California Fair Employment and Housing Act (Gov. Code §§ 12900 – 12996.) a person may also file a complaint of discrimination/harassment with the California Department of Fair Employment and Housing (“DFEH”). Employees or non-employees who believe that they have been subjected to discrimination/harassment may file a complaint with either of these agencies. Both the EEOC and DFEH serve as neutral fact-finders and attempt to assist parties in resolving disputes voluntarily.

I. Communication of Policy
This policy shall be provided to all managers, supervisors, employees, volunteers, unpaid interns, agents, or contractors of the City and shall be posted in the appropriate places. All employees shall participate in City approved harassment awareness training as directed by management or Human #6..
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EXHIBIT K

ANTI-DISCRIMINATION AND ANTI-HARRASMENT
January 27, 2026 Page K-8 Service Agreement, Exhibit K
Resources; and all supervisors, as required by law, shall participate in City approved interactive harassment awareness training and education sessions at least once every two years, or as otherwise specified by law.
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RESTATED SERVICE AGREEMENT

BETWEEN

CITY OF MODESTO
AND
BERTOLOTTI MODESTO DISPOSAL, INC.

FOR

SOLID WASTE COLLECTION, PROCESSING, AND DISPOSAL

SERVICES
JANUARY 27, 2026
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Restated Service Agreement January 27, 2026 -i- City of Modesto/Bertolotti Modesto Disposal, Inc.

TABLE OF CONTENTS
RECITALS ....................................................................................................................................1 ARTICLE 1. GRANT AND ACCEPTANCE OF AGREEMENT ....................................................2

1.1 Grant and Acceptance of Agreement..........................................................................................2

1.2 Limitations to the Agreement .....................................................................................................2

1.3 Obligations of Parties ..................................................................................................................5 ARTICLE 2. TERM OF AGREEMENT..........................................................................................5

2.1 Effective Date ..............................................................................................................................5

2.2 Term and Option to Extend.........................................................................................................6

2.3 Conditions to Effectiveness of Agreement..................................................................................6 ARTICLE 3. SCOPE OF AGREEMENT .......................................................................................7

3.1 Summary Scope of Services.........................................................................................................7

3.2 Use of Approved Facilities...........................................................................................................7

3.3 Subcontracting ............................................................................................................................8

3.4 Responsibility for Materials.........................................................................................................8

3.5 City-Directed Changes to Scope ..................................................................................................8 ARTICLE 4. SCOPE OF SERVICES ............................................................................................9

4.1 General........................................................................................................................................9

4.2 Recyclable Materials ...................................................................................................................9

4.3 Organic Materials ......................................................................................................................12

4.4 Garbage .....................................................................................................................................13

4.5 Bulky Item Collection Service ....................................................................................................14

4.6 Used Motor Oil and Filter Collection.........................................................................................15

4.7 Special Events............................................................................................................................15

4.8 Public Education and Outreach .................................................................................................16

4.9 Community Clean-up Events .....................................................................................................16

4.10 Illegal Dumping..........................................................................................................................17

4.11 Billing.........................................................................................................................................17

4.12 Customer Service Program........................................................................................................19

4.13 Service Exemptions ...................................................................................................................22

4.14 Waste Generation and Characterization Studies .....................................................................22

4.15 Extended Producer Responsibility Programs ............................................................................22 ARTICLE 5. STANDARD OF PERFORMANCE ........................................................................24

5.1 General......................................................................................................................................24

5.2 Operating Hours and Schedules ................................................................................................24

5.3 Collection Standards .................................................................................................................24

5.4 Transfer and Processing Standards ...........................................................................................26

5.5 Collection Vehicle Requirements ..............................................................................................27

5.6 Container Requirements ...........................................................................................................29

5.7 Personnel ..................................................................................................................................33

5.8 Hazardous and Excluded Waste Inspection and Handling ........................................................34

5.9 Contract Management ..............................................................................................................35 #6..
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Restated Service Agreement January 27, 2026 -ii- City of Modesto/Bertolotti Modesto Disposal, Inc.

5.10 Local Purchasing Preference .....................................................................................................35

5.11 Diversion Requirements............................................................................................................35 ARTICLE 6. RECORDKEEPING AND REPORTING.................................................................36

6.1 Recordkeeping...........................................................................................................................36

6.2 Report Submittal Requirements................................................................................................37

6.3 Performance Review and Audit.................................................................................................37 ARTICLE 7. CITY REIMBURSEMENT.......................................................................................38

7.1 Contract Administration Reimbursement .................................................................................38

7.2 AB 939/SB 1383 Reimbursement ..............................................................................................38

7.3 Public Education Reimbursement .............................................................................................38

7.4 Waste Generation and Characterization Reimbursement ........................................................39

7.5 Adjustment to Reimbursement.................................................................................................39

7.6 Payment Schedule and Late Fees..............................................................................................39 ARTICLE 8. CONTRACTOR'S COMPENSATION AND RATE SETTING ................................40

8.1 General......................................................................................................................................40

8.2 Rates and Annual Adjustments .................................................................................................40

8.3 Extraordinary Rate Adjustments ...............................................................................................41 ARTICLE 9. INDEMNITY, INSURANCE, AND PERFORMANCE BOND ..................................41

9.1 Indemnification .........................................................................................................................41

9.2 Insurance...................................................................................................................................44

9.3 Performance Bond ....................................................................................................................47 ARTICLE 10. DEFAULT AND REMEDIES ................................................................................47

10.1 Events of Default .......................................................................................................................47

10.2 Contractor’s Right To Cure; City’s Right to Terminate Upon Event of Default..........................49

10.3 City’s Remedies in the Event of Default ....................................................................................49

10.4 Possession of Records Upon Termination.................................................................................51

10.5 Performance Standards and Liquidated Damages ....................................................................51

10.6 Excuse from Performance .........................................................................................................52

10.7 Right to Demand Assurances of Performance...........................................................................53

10.8 Dispute Resolution ....................................................................................................................53 ARTICLE 11. REPRESENTATIONS AND WARRANTIES OF THE PARTIES .........................54

11.1 Contractor’s Corporate Status...................................................................................................54

11.2 Contractor’s Corporate Authorization.......................................................................................54

11.3 Agreement Will Not Cause Breach ............................................................................................54

11.4 No Litigation ..............................................................................................................................55

11.5 No Adverse Judicial Decisions ...................................................................................................55

11.6 No Legal Prohibition..................................................................................................................55

11.7 Contractor’s Ability to Perform .................................................................................................55 ARTICLE 12. OTHER AGREEMENTS OF THE PARTIES ........................................................55

12.1 Relationship of Parties ..............................................................................................................55

12.2 Compliance with Law ................................................................................................................56

12.3 Governing Law...........................................................................................................................56 #6..
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Restated Service Agreement January 27, 2026 -iii- City of Modesto/Bertolotti Modesto Disposal, Inc.

12.4 Jurisdiction ................................................................................................................................56

12.5 Binding on Successors ...............................................................................................................56

12.6 Assignment................................................................................................................................56

12.7 No Third Party Beneficiaries......................................................................................................58

12.8 Waiver .......................................................................................................................................58

12.9 Notice Procedures.....................................................................................................................58

12.10 Representatives of the Parties ..................................................................................................59 ARTICLE 13. MISCELLANEOUS AGREEMENTS ....................................................................59

13.1 Entire Agreement ......................................................................................................................59

13.2 Capitalized Terms ......................................................................................................................59

13.3 Section Headings .......................................................................................................................59

13.4 References to Laws ...................................................................................................................59

13.5 Amendments.............................................................................................................................59

13.6 Severability................................................................................................................................60

13.7 Counterparts .............................................................................................................................60

13.8 Exhibits ......................................................................................................................................60 #6..
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Restated Service Agreement January 27, 2026 -iv- City of Modesto/Bertolotti Modesto Disposal, Inc.

List of Exhibits
A. Definitions
B. Direct Services
C. Customer Service Plan
D. Reporting Requirements
E. Rate Adjustment Methodology
F. Performance Standards and Liquidated Damages
G. Contractor’s Cost Basis and Initial Rates
H. Approved Recyclable Materials Processing Facility Load Rejection Standards I. Approved Affiliates and Subcontractors
J. Service Area Maps
K. Anti-Discrimination and Anti-Harassment
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Restated Service Agreement January 27, 2026 -1- City of Modesto/Bertolotti Modesto Disposal, Inc. 1 SERVICE AGREEMENT
2 BETWEEN
3 CITY OF MODESTO
4 AND
5 BERTOLOTTI MODESTO DISPOSAL, INC.
6 FOR
7 SOLID WASTE COLLECTION, PROCESSING, AND
8 DISPOSAL SERVICES
9 THIS SERVICE AGREEMENT (Agreement) is made and entered into as of __________, 2026, between the 10 City of Modesto, California, a Charter City in the State of California (hereinafter "City"), and Bertolotti 11 Modesto Disposal, Inc., (hereinafter referred to as the "Contractor"). 12 RECITALS
13 This Agreement is entered into with reference to the following facts and circumstances:
14 WHEREAS, the Legislature of the State of California, by enactment of the California Integrated Waste 15 Management Act of 1989 (AB 939) (California Public Resources Code Section 40000 et seq.), has declared 16 that it is in the public interest to authorize and require local agencies to make adequate provisions for 17 Garbage Collection within their jurisdiction; and
18 WHEREAS, the State of California has found and declared that the amount of refuse generated in 19 California, along with diminishing Disposal capacity, potential adverse environmental impacts from 20 landfilling, and the need to conserve natural resources, has created an urgent need for State and local 21 agencies to enact and implement an aggressive integrated waste management program. The State has, 22 through enactment of AB 939 and subsequent related legislation, including, but not limited to: the Jobs 23 and Recycling Act of 2011 (AB 341), the Event and Venue Recycling Act of 2004 (AB 2176), SB 1016 24 (Chapter 343, Statutes of 2008 [Wiggins, SB 1016]), the Mandatory Commercial Organics Recycling Act of 25 2014 (AB 1826), the Short-Lived Climate Pollutants Bill of 2016 (SB 1383), the California Green Building 26 Standards Code (CALGreen), AB 1594, AB 1201, AB 343, and the Plastic Pollution Prevention and Packaging 27 Producer Responsibility Act (SB 54), directed the responsible State agency, and all local agencies, to 28 promote Diversion and to maximize the use of feasible waste reduction, reuse, Recycling, and Composting 29 options in order to reduce the amount of refuse that must be Disposed; and 30 WHEREAS, SB 1383 establishes regulatory requirements for jurisdictions, Generators, haulers, Solid Waste 31 facilities, and other entities to support achievement of Statewide Organic Waste Disposal reduction 32 targets; and
Commented [SP1]: Note: To be filled at time of execution. #6..
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Restated Service Agreement January 27, 2026 -2- City of Modesto/Bertolotti Modesto Disposal, Inc. 33 WHEREAS, SB 1383 requires the City to implement Collection programs, meet Processing Facility 34 requirements, conduct contamination monitoring, provide education, maintain records, submit reports, 35 monitor compliance, conduct enforcement, and fulfill other requirements. The City has chosen to 36 delegate some of its responsibilities to Contractor, acting as the City’s designee, through this Agreement; 37 and
38 WHEREAS, pursuant to California Public Resources Code Section 40059(a)(2), the City has determined that 39 the public health, safety, and well-being require that an exclusive right be awarded to qualified 40 Contractors to provide for the Collection of Recyclable Materials, Organic Materials, and Garbage, and 41 other services related to meeting the City’s economic and environmental goals; and 42 WHEREAS, the City further declares its intent to approve and maintain reasonable Rates for the Collection, 43 Recycling, Processing, Composting, and/or Disposal of Recyclable Materials, Organic Materials, and 44 Garbage; and
45 WHEREAS, the City desires, having determined that Contractor, by demonstrated experience, reputation 46 and capacity, is qualified to provide for both the Collection of Recyclable Materials, Organic Materials, and 47 Garbage within the corporate limits of the City and the Transportation of such material to appropriate 48 places for Processing, Recycling, Composting, and/or Disposal, that Contractor be engaged to perform 49 such services on the basis set forth in this Agreement; and 50 WHEREAS, the City and Contractor have attempted to address conditions affecting their performance of 51 services under this Agreement, but recognize that reasonably unanticipated conditions may occur during 52 the Term of this Agreement that will require the Parties to meet and confer to reasonably respond to such 53 changed conditions; and
54 WHEREAS, under Municipal Code Title 5, Chapter 5, Article 1, the City Council may establish one (1) or 55 more authorized Collectors by agreement, contract, or permit, upon such terms and conditions as the 56 City Council deems appropriate for the public health, safety, and welfare of the City. 57 NOW, THEREFORE, in consideration of the mutual promises, covenants, and conditions contained in this 58 Agreement and for other good and valuable consideration, the Parties agree as follows:
59 ARTICLE 1.
60 GRANT AND ACCEPTANCE OF AGREEMENT
61 1.1 Grant and Acceptance of Agreement
62 By the signing of this Agreement, the City grants to Contractor and Contractor accepts an exclusive right 63 within certain limits in the City, specifically those areas delineated and described in Exhibit J. The exclusive 64 rights granted to Contractor shall be for the scope of services described in this Agreement, subject to the 65 limitations described in Section 1.2, and except where otherwise precluded by Applicable Law. 66 1.2 Limitations to the Agreement
67 The award of this Agreement shall not preclude the categories of Recyclable Materials, Organic Materials, 68 Garbage, or other materials listed below from being delivered to, Collected, and Transported by others, #6..
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Restated Service Agreement January 27, 2026 -3- City of Modesto/Bertolotti Modesto Disposal, Inc. 69 solely as specified below, provided that nothing in this Agreement is intended to or shall be construed to 70 excuse any Person from obtaining any authorization from the City that is otherwise required by Applicable 71 Law.
72 A. Self-Hauled Materials. Recyclable Materials, Organic Materials, Garbage, Construction and 73 Demolition Debris, and Bulky Items that are removed from any Premises by the Generator, and that 74 are Transported personally by such Generator (or by its full-time employees) to a Processing or 75 Disposal Facility in a manner consistent with all Applicable Law. 76 B. Donated or Sold Materials. Any items that are Source Separated at any Premises by the Generator 77 and sold or donated to other Persons, including youth, civic, or charitable organizations. 78 C. Edible Food. Edible Food that is Collected from a Generator by other Person(s), such as a Person 79 from a Food Recovery Organization or Food Recovery Service, for the purposes of Food Recovery; 80 or that is Self-Hauled by the Generator to another Person(s), such as a Person from a Food Recovery 81 Organization, for the purposes of Food Recovery, regardless of whether the Generator donates, 82 sells, or pays a fee to the other Person(s) to Collect or receive the Edible Food. 83 D. Food Scraps. Food Scraps that are Source Separated by the Generator and used by the Generator 84 or distributed to other Person(s) for lawful use as animal feed, in accordance with 14 CCR Section 85 18983.1(b)(7). Food Scraps intended for animal feed may be Self-Hauled by Generator or hauled by 86 another party.
87 E. Materials That Contractor Does Not Divert. Solid Waste that Contractor is not required to Process 88 and Divert under this Agreement as of the Effective Date of this Agreement, which subsequently (in 89 the City’s reasonable judgment) becomes economically feasible to Divert. In such event, Contractor 90 shall have the exclusive right within the areas delineated as Service Areas in Exhibit J to Collect and 91 Process such materials if Contractor agrees to do so without any change in Rates. If Contractor is 92 unwilling to Process and Divert such new materials at existing Rates, the City may provide for 93 Collection, Processing, and Diversion of such materials in any manner it deems appropriate. Such 94 materials may include, but not be limited to, Recyclable Materials and Organic Waste of which 95 Contractor would otherwise Dispose. Contractor may not enforce its exclusive rights in a manner 96 that would prevent the Diversion of material that Contractor is unable or unwilling to Divert. 97 F. Beverage Containers. Containers delivered for Recycling under the California Beverage Container 98 Recycling and Litter Reduction Act, Section 14500 et seq. of the California Public Resources Code. 99 G. Materials Removed by Customer’s Contractor as Incidental Part of Services. Recyclable Materials, 100 Organic Materials, Garbage, Construction and Demolition Debris, and Bulky Items removed from a 101 Premises by a contractor (e.g., gardener, landscaper, tree-trimming service, construction 102 contractor, Residential clean-out service) as an incidental part of the service being performed, 103 rather than as a separately contracted or subcontracted hauling service; or if such contractor is 104 providing a service that is not included in the scope of this Agreement. 105 H. Onsite Composting. Organic Materials Composted or otherwise legally managed at the site where 106 they are generated (e.g., backyard Composting or onsite anaerobic digestion). #6..
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Restated Service Agreement January 27, 2026 -4- City of Modesto/Bertolotti Modesto Disposal, Inc. 107 I. Fats, Oils, and Grease: Fats, oils, and grease, including, but not limited to, animal waste (e.g., 108 remains from slaughterhouses or butcher shops), grease waste, used cooking oil, or any variation 109 thereof.
110 J. Sewage Treatment By-Product. By-products of sewage treatment, including sludge, sludge ash, grit, 111 and screenings.
112 K. Excluded Waste. Excluded Waste regardless of its source. 113 L. Materials Generated by State and County Facilities. Materials generated by State and County 114 facilities located in the City, including, but not limited to, the Modesto City Schools District, provided 115 that the Generator has arranged services with other Persons or has arranged services with 116 Contractor through a separate agreement.
117 M. Government Agencies Other Than the City. Collection, Transfer, Transport, Recycling, Processing, 118 and Disposal Services for governmental agencies other than the City that may have facilities in the 119 City, but over which City has no jurisdiction in connection with the regulation of Garbage. 120 N. Hazardous, Biohazardous, and Excluded Waste. Collection, Transfer, Transport, Recycling, 121 Processing, and Disposal of Hazardous Substances, Hazardous Waste, biohazardous waste, Excluded 122 Waste, and radioactive waste, regardless of its source. 123 O. Solid Waste Collected by City Employees. Collection, Transfer, Transport, Recycling, Processing, 124 and Disposal of Solid Waste by the City through City officers or employees in the normal course of 125 their employment.
126 P. Cannabis Waste. Cannabis waste as described in the California Code of Regulations, Title 3, Division 127 8, Chapter 1, Article 1.
128 Q. Construction and Demolition Debris (C&D). Construction and Demolition Debris (C&D) Collected 129 and Transported from a permitted construction or demolition project consistent with the City’s 130 Municipal Code and other Applicable Law.
131 Contractor acknowledges and agrees that the City may permit other Persons besides Contractor to Collect 132 any and all types of materials excluded from the scope of this Agreement or any and all types of materials 133 outside of the Service Areas, as described in Exhibit J, as set forth above, without seeking or obtaining 134 approval of Contractor. If Contractor can produce evidence that other Persons are servicing Collection 135 Containers or are Collecting and Transporting Recyclable Materials, Organic Materials, and/or Garbage in 136 a manner that is not consistent with this Agreement or the City’s Municipal Code, it shall report the 137 location of the occurrence and the name and phone number of the Person or company performing the 138 service to the City Contract Manager, along with Contractor’s evidence. In such case, the City may notify 139 the Generator and Person providing service of Contractor’s rights under this Agreement. 140 This Agreement shall be interpreted to be consistent with Applicable Law, now and during the Term of 141 the Agreement. If future judicial interpretations of current law or new laws, regulations, or judicial 142 interpretations limit the ability of the City to lawfully contract for the scope of services in the manner 143 consistent with all provisions as specifically set forth herein, Contractor agrees that the scope of the 144 Agreement will be limited to those services and materials that may be lawfully included herein, and that 145 the City shall not be responsible for any lost profits or losses claimed by Contractor to arise out of #6..
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Restated Service Agreement January 27, 2026 -5- City of Modesto/Bertolotti Modesto Disposal, Inc. 146 limitations to the scope or provisions of the Agreement as set forth herein. In such an event, it shall be 147 the responsibility of Contractor to minimize the financial impact of such future judicial interpretations or 148 new laws. Contractor may meet and confer with City and may petition for a Rate adjustment pursuant to 149 Section 8.3.
150 1.3 Obligations of Parties
151 In addition to the specific performance required under the Agreement, the City and Contractor shall:
152 A. Use their commercially reasonable efforts to enforce the exclusive nature of the Agreement by 153 Contractor’s identification and documentation of violations of the Agreement and the City’s 154 notification of Generators and Collection companies reasonably believed to be violating the rights 155 under the terms of this Agreement.
156 B. Provide notice, as soon as reasonably possible, to one another of a perceived failure to perform any 157 obligation under this Agreement and provide access to information demonstrating the Party’s 158 failure to perform.
159 C. Provide timely access to the City Contract Manager and Contractor’s Contract Manager (or his/her 160 designated representative) and timely responses to requests made by the other Party. For the 161 purpose of this Section, “timely” means providing access or responses to requests in a manner that 162 facilitates ongoing performance under the Agreement and ensures that neither Party is unduly 163 delayed.
164 D. Provide notice, as soon as the Party becomes aware, of matters that may affect either Party’s ability 165 to perform under the Agreement.
166 ARTICLE 2.
167 TERM OF AGREEMENT
168 2.1 Effective Date
169 The Effective Date of this Agreement shall be the date at which all of the obligations set forth in Section 170 2.3 of this Agreement have been satisfied.
171 This Agreement shall become effective at the Effective Date. However, the provision of services, 172 imposition of Customer Rates, payment of City Reimbursements, and actual Collection services by 173 Contractor shall begin on May 1, 2026 (Commencement Date), as described in Section 2.2. Contractor 174 understands and agrees that the interim time between the Effective Date and the Commencement Date 175 is intended to provide Contractor with ample and sufficient time to, among other things, order equipment, 176 prepare necessary routing schedules and route maps, obtain any permits and licenses, establish/build 177 facilities, and obtain required service agreements as part of Contractor’s transition program, as specified 178 in this Agreement. The City may also begin the public awareness campaign in the interim time between 179 the Effective Date and the Commencement Date.
180 Between the Effective Date and Commencement Date, Contractor shall perform all activities necessary to 181 prepare itself to provide the services required by this Agreement on the Commencement Date. #6..
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Restated Service Agreement January 27, 2026 -6- City of Modesto/Bertolotti Modesto Disposal, Inc. 182 2.2 Term and Option to Extend
183 The Term of this Agreement shall commence on May 1, 2026, the Commencement Date, and continue in 184 full force for a period of ten (10) years, through and including January 31, 2036, unless the Agreement is 185 extended in accordance with this Section or terminated pursuant to Article 10. 186 Upon mutual agreement of the Parties, this Agreement may be extended without amendment for a period 187 of no more than five (5) additional years for a total Term that does not extend beyond January 30, 2041. 188 If the City desires to extend the Agreement, the City shall provide Contractor with written notice of its 189 decision to extend the Agreement at least two (2) years before the expiration of the initial Term. Such 190 notice by the City shall specify the duration of the extension. 191 2.3 Conditions to Effectiveness of Agreement
192 The obligation of the City to permit this Agreement to become effective and perform its undertakings 193 provided for in this Agreement is subject to the satisfaction of all the conditions below, each of which may 194 be waived, in written form only, in whole or in part by the City. 195 A. Accuracy of Representations. Contractor’s representations and warranties made throughout the 196 negotiations of this Agreement are true and correct on and as of the Effective Date. 197 B. Furnishings of Insurance and Performance Bond. Contractor has furnished evidence of the 198 insurance and performance bond required by Article 9 that is satisfactory to the City. 199 C. Absence of Litigation. To the best of Contractor's knowledge, after reasonable investigation, there 200 is no action, suit, proceeding or investigation, at law or in equity, before or by any court or 201 governmental authority, commission, board, agency, or instrumentality, decided, pending, or 202 threatened against Contractor wherein an unfavorable decision, ruling, or finding, in any single case 203 or in the aggregate, would:
204 1. Materially adversely affect the performance by Contractor of its obligations hereunder. 205 2. Adversely affect the validity or enforceability of this Agreement. 206 3. Materially adversely affect the financial condition of Contractor, or any surety or entity 207 guaranteeing Contractor's performance under this Agreement. 208 D. Permits Furnished. Contractor has provided the City with copies of all permits necessary for 209 operation of all Approved Facilities owned or operated by Contractor or any Subcontractor for use 210 under the terms of this Agreement, with the exception of Approved Facilities owned or operated by 211 the City.
212 E. Legal Challenge. Contractor understands and acknowledges that the award of this Agreement and 213 related decisions may be subject to review and repeal by the City’s citizens through a referendum 214 or similar petition, and may be subject to various types of legal and environmental challenges (such 215 referenda, similar petitions, and legal and environmental challenges, referred to collectively as 216 “Legal Challenges”). Accordingly, this Agreement shall not become effective until the City 217 reasonably determines that: (i) any Legal Challenges that had been initiated as of the time of such 218 determination have been resolved in favor of the City’s award of this Agreement to Contractor; and #6..
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Restated Service Agreement January 27, 2026 -7- City of Modesto/Bertolotti Modesto Disposal, Inc. 219 (ii) the deadline to initiate any additional Legal Challenges has expired; provided, however, that 220 Contractor shall be entitled to rescind this Agreement upon thirty (30) Days’ prior written notice to 221 the City if such determination is not made by _______________. 222 ARTICLE 3.
223 SCOPE OF AGREEMENT
224 3.1 Summary Scope of Services
225 Contractor or its Subcontractor(s) shall be responsible for the following:
226 A. Providing a three (3)-Container Collection program for the separate Collection of Recyclable 227 Materials, Organic Materials, and Garbage generated by and placed for Collection by Customers 228 pursuant to the requirements of Article 4 and Exhibit B. 229 B. Transporting Collected materials to the appropriate Approved Facilities pursuant to requirements 230 of Article 4 and Exhibit B.
231 C. Processing Collected Recyclable Materials at the appropriate Approved Recyclable Materials 232 Processing Facility pursuant to the requirements of Article 4 and Exhibit B. 233 D. Performing all other services required by this Agreement, including, but not limited to, Customer 234 billing, Customer service, recordkeeping, and reporting pursuant to Articles 4 and 6 and Exhibit D 235 (Reporting Requirements).
236 E. Furnishing all labor, supervision, vehicles, Containers, other equipment, materials, supplies, and all 237 other items and services necessary to perform its obligations under this Agreement. 238 F. Paying all expenses related to provision of services required by this Agreement, including, but not 239 limited to, taxes, regulatory fees (including City Reimbursements), and utilities. 240 G. Performing or providing all services necessary to fulfill its obligations in full accordance with this 241 Agreement at all times, using best industry practice for comparable operations. 242 H. Complying with all Applicable Laws.
243 The enumeration and specification of particular aspects of service, labor, or equipment requirements shall 244 not relieve Contractor of the duty to perform all other tasks and activities necessary to fulfill its obligations 245 under this Agreement, regardless of whether such requirements are enumerated elsewhere in the 246 Agreement, unless excused in accordance with Section 10.6. 247 3.2 Use of Approved Facilities
248 Contractor, without constraint and as a free market business decision in accepting this Agreement, agrees 249 to use: (i) the Approved Recyclable Materials Processing Facility for the purposes of Processing all 250 Recyclable Materials; (ii) the Approved Organic Materials Processing Facility for the purposes of pre251 Processing and Processing all Organic Materials; (iii) the Approved Disposal Facility for the purposes of 252 Disposing of Garbage and Residue; and (iv) the Approved Transfer Facility for the purposes of Transporting Commented [SP2]: Note: City Attorney to populate date.
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Restated Service Agreement January 27, 2026 -8- City of Modesto/Bertolotti Modesto Disposal, Inc. 253 Solid Waste and other material Collected in the City. Use of a facility must be approved by the City in 254 writing prior to use, consistent with the requirements of Article 4. Once approved by the City, it shall be 255 an “Approved Facility” for the purposes of this Agreement. Such decision by Contractor in no way 256 constitutes a restraint of trade, notwithstanding any Change in Law regarding Flow Control limitations or 257 any definition thereof.
258 3.3 Subcontracting
259 Contractor shall not engage any Subcontractors or Affiliates for Collection, Transportation, Processing, or 260 Disposal services for Recyclable Materials, Organic Materials, or Garbage under this Agreement without 261 the prior written consent of the City Contract Manager. As of the Effective Date of this Agreement, the 262 City has approved Contractor’s use of those Subcontractors of Affiliates identified in Exhibit I. If Contractor 263 plans to engage any Affiliate or a Subcontractor in the provision of services, Contractor shall provide City 264 Contract Manager with thirty (30) Days’ written notification of its plans and provide an explanation of any 265 potential impacts related to the quality, timeliness, or cost of providing services under this Agreement. 266 Contractor shall require that all Subcontractors file insurance certificates with the City, name City as an 267 additional insured, and comply with all material terms of this Agreement. 268 3.4 Responsibility for Materials
269 Once Recyclable Materials, Organic Materials, and/or Garbage is placed in Contractor’s Containers and at 270 the Collection location, the responsibility for their proper handling shall transfer directly from the 271 Generator to Contractor, with the exception of Excluded Waste, if Contractor can identify the Generator 272 pursuant to Section 5.8. Once Recyclable Materials, Organic Materials, and/or Garbage is deposited by 273 Contractor at the appropriate Approved Facility, such materials shall become the responsibility of the 274 Owner or operator of the Approved Facility, with the exception of Excluded Waste pursuant to Section 275 5.8.
276 Responsibility for Excluded Waste that has been inadvertently Collected by Contractor shall remain with 277 Contractor if it cannot identify the Generator, and Contractor shall assume all responsibility for its proper 278 Processing or Disposal.
279 3.5 City-Directed Changes to Scope
280 City may require a proposal from Contractor to establish the scope of any modification or addition to 281 existing services, which may include the use of Approved Facilities, to be provided under this Agreement. 282 In such case, Contractor shall present, within thirty (30) Days of the City’s request, unless an alternate 283 schedule is mutually agreed upon, a written proposal to provide such modified or additional services. The 284 City shall review Contractor’s proposal for the change in scope of services. The City and Contractor may 285 meet and confer to negotiate Contractor’s proposed revisions and costs, and shall amend this Agreement, 286 as appropriate, to reflect the mutually agreed-upon changes in scope. If the City and Contractor are unable 287 to agree on terms and conditions, including compensation adjustments, of such services within ninety 288 (90) Days from City receipt of Contractor’s proposal for such services, the City may permit other Persons 289 to provide such services. Nothing herein shall prevent the City from soliciting cost and operating 290 information from other Persons in order to inform the City’s evaluation of Contractor’s proposal. 291 At any time during the Term of this Agreement, the City may solicit proposals from other Persons for 292 services not contemplated under this Agreement. In the event that contracting with other Persons for 293 such services will reduce Contractor’s Compensation under this Agreement, as described in Article 8, #6..
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Restated Service Agreement January 27, 2026 -9- City of Modesto/Bertolotti Modesto Disposal, Inc. 294 Contractor shall be offered the opportunity to match any other Person’s proposed pricing, and retain the 295 added scope of services. However, nothing in this Agreement shall prevent the City from contracting with 296 other Persons in the event that Contractor is unable or unwilling to provide such services at or below the 297 cost proposed by the other Person.
298 ARTICLE 4.
299 SCOPE OF SERVICES
300 4.1 General
301 A. General. Contractor shall perform the Recyclable Materials, Organic Materials, Garbage, and Bulky 302 Item services described in this Article. This Article describes the general requirements for the 303 services to be provided. More specific requirements for how each service shall be provided to each 304 Customer Type are described in Exhibit B. Failure to specifically require an act necessary to perform 305 the service does not relieve Contractor of its obligation to perform such act. 306 B. Commitment to Diversion. Contractor acknowledges that City is committed to Diverting materials 307 from Disposal through the implementation of source reduction, reuse, repair, Recycling, 308 Composting, and other programs, and that City may implement new programs, with or without the 309 involvement of Contractor, that may impact the overall quantity or composition of Solid Waste to 310 be Collected by Contractor. Contractor shall not be entitled to any compensation or other relief 311 resulting from a decline in Solid Waste volumes or Tonnage, or from a change in the composition of 312 Solid Waste.
313 4.2 Recyclable Materials
314 A. Collection. Contractor shall provide Recyclable Materials Collection services as described in 315 Exhibit B.
316 B. Transfer. If Contractor plans to Transfer Recyclable Materials, Contractor shall Transport Recyclable 317 Materials to the Approved Transfer Facility where the materials will be unloaded from Collection 318 vehicles, loaded into large-capacity vehicles, and Transported to the Approved Recyclable Materials 319 Processing Facility. If Contractor is unable to use the Approved Transfer Facility, then Contractor 320 shall be responsible for making other Transportation arrangements. In such event, Contractor shall 321 not be compensated for any additional costs. If Contractor plans to change its Transfer method, 322 Contractor shall obtain written approval from the City thirty (30) Days prior to making the change, 323 with the exception of events constituting an excuse from performance, as described in 324 Subsection 4.2.C.3.
325 C. Processing. Contractor shall Transport and deliver all Source Separated Recyclable Materials placed 326 in Recyclable Materials Containers in the Service Area to the Approved Recyclable Materials 327 Processing Facility. All tipping fees and other costs associated with the Transportation and 328 Processing of such Recyclable Materials at the Approved Recyclable Materials Processing Facility 329 and Disposing of the Residue, as required in Subsection 4.2.E below, shall be paid by Contractor. #6..
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Restated Service Agreement January 27, 2026 -10- City of Modesto/Bertolotti Modesto Disposal, Inc. 330 1. Capacity Guarantee. Contractor guarantees sufficient capacity at the Approved Recyclable 331 Materials Processing Facility to Process all Source Separated Recyclable Materials Collected 332 by Contractor under this Agreement throughout the Term of the Agreement. 333 2. Compliance with Regulatory Requirements and Applicable Law. Contractor shall keep all 334 existing permits and approvals necessary for use of the Approved Recyclable Materials 335 Processing Facility in full compliance with Applicable Law. Upon request, Contractor shall 336 provide copies of facility permits and/or notices of violations (obtained from its Processing 337 Facility Subcontractor, if necessary) to the City Contract Manager. 338 Contractor shall observe and comply with all regulations in effect at the Approved Recyclable 339 Materials Processing Facility and cooperate with and take direction from the operator thereof 340 with respect to delivery of Recyclable Materials. Contractor shall actively work with the 341 Approved Recyclable Materials Processing Facility operator throughout the Term of this 342 Agreement to ensure that contamination of the Recyclable Materials Collected under this 343 Agreement and delivered to the Processing Facility remains below the limits established by 344 Applicable Law.
345 3. Notification of Excuse from Performance. Contractor shall notify the City of any unforeseen 346 operational restrictions that have been imposed upon the Approved Recyclable Materials 347 Processing Facility by a regulatory agency or any unforeseen equipment or operational failure 348 that will temporarily prevent the Approved Recyclable Materials Processing Facility from 349 Processing the Recyclable Materials Collected under this Agreement. 350 If Contractor is unable to use the Approved Transfer Facility or the Approved Recyclable 351 Materials Processing Facility due to an event that meets the requirements for excusing 352 Contractor from performance of this specific obligation, as described in Section 10.6, 353 Contractor shall use an Alternative Facility, provided that Contractor provides written notice 354 to the City Contract Manager. Within forty-eight (48) hours of such excuse from performance, 355 Contractor shall provide the City a written description of the reasons the use of the Approved 356 Recyclable Materials Processing Facility is not feasible and the period of time Contractor 357 proposes to use the Alternative Facility. Such a change in Processing Facility shall be 358 temporarily permitted until such time as the City Contract Manager is able to consider and 359 respond to the written description of use of the proposed Alternative Facility. If the use of the 360 proposed Alternative Facility is anticipated to, or actually does, exceed thirty (30) Days in a 361 consecutive twelve (12) month period, the use of such Processing Facility shall be subject to 362 approval by the City Contract Manager. The City Contract Manager may, in their sole 363 discretion, approve, conditionally approve, temporarily approve, or disapprove of the use of 364 the proposed Alternative Facility. In the event that the City disapproves the use of the 365 proposed Alternative Facility, the Parties shall meet and confer to determine an acceptable 366 Processing Facility.
367 4. Use of Alternative Facility(ies). If the use of an Alternative Facility is for reasons within 368 Contractor’s, or its Processing Facility Subcontractor’s Control, Contractor’s Compensation 369 shall not be adjusted for any change in Transportation and Processing costs associated with 370 use of the Alternative Facility. However, if the use of an Alternative Facility is due to reasons 371 beyond Contractor’s or its Subcontractor’s Control, then the City shall adjust, either up or 372 down, Contractor’s Compensation for changes in Transportation and Processing costs #6..
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Restated Service Agreement January 27, 2026 -11- City of Modesto/Bertolotti Modesto Disposal, Inc. 373 associated with the use of the Alternative Facility. The performance of Recyclable Materials 374 commodity markets shall not be considered an acceptable basis for use of an Alternative 375 Facility, nor shall it serve as the basis for any adjustment in Contractor’s Compensation under 376 this Agreement, other than as specifically contemplated in Exhibit E of this Agreement. In the 377 event that the use of the Alternative Facility results in increased costs, the City may identify 378 and direct Contractor to a less-costly Alternative Facility without additional compensation to 379 Contractor. Except for the conditions described in this Section and further described in 380 Section 10.6, Contractor shall not change its selection of the Approved Recyclable Materials 381 Processing Facility without City’s written approval, which may be withheld in the City’s sole 382 discretion. If Contractor elects to use a Recyclable Materials Processing Facility that is 383 different than the initial Approved Recyclable Materials Processing Facility, it shall request 384 written approval from the City Contract Manager thirty (30) Days prior to use of the site and 385 obtain the City’s written approval no later than ten (10) Days prior to use of the site. 386 5. Load Classification. Prior to the Commencement Date, Contractor shall work with the City 387 and the Approved Recyclable Materials Processing Facility to develop Approved Recyclable 388 Materials Processing Facility Load Rejection Standards that will be attached to this Agreement 389 as Exhibit H. Contractor shall, at all times, follow the load classification procedures and load 390 rejection standards for all Recyclable Materials delivered to the Approved Recyclable 391 Materials Processing Facility per Exhibit H. Contractor further acknowledges the load 392 classification procedures and load rejection standards of the Approved Recyclable Materials 393 Processing Facility may change from time to time, as directed by the City. Contractor shall use 394 the Approved Disposal Facility for Recyclable Materials loads that are rejected by the 395 Approved Recyclable Materials Processing Facility.
396 D. Marketing. Contractor or Processing Facility Subcontractor shall be responsible for marketing 397 Recyclable Materials Collected in the City that are delivered for Processing at Contractor’s Approved 398 Recyclable Materials Processing Facility.
399 E. Residue Disposal. Residue from the Processing of Source Separated Recyclable Materials Collected 400 under this Agreement at Contractor’s Approved Recyclable Materials Processing Facility, which 401 cannot be marketed, shall be Disposed of by Contractor or the Processing Facility Subcontractor at 402 the Approved Disposal Facility. Residue delivered for Disposal shall not include any Excluded Waste. 403 F. Minimizing Prohibited Container Contaminants. Contractor shall make its best efforts, including 404 those measures specifically identified in this Agreement, as well as effective industry practices that 405 may be identified during the Term of this Agreement, to reduce Prohibited Container Contaminants. 406 Contractor shall use information resulting from the Prohibited Container Contaminant monitoring 407 program and any material characterization studies performed on City Solid Waste to help propose 408 education and outreach campaigns that target specific problem materials. Contractor shall share 409 any contamination observations, statistics, pictures, and reports from the Approved Recyclable 410 Materials Processing Facility with the City.
411 G. City Right to Redirect Recyclable Materials. The City may, at any time during the Term of this 412 Agreement, require Contractor to deliver Recyclable Materials Collected under this Agreement to a 413 Processing Facility other than the Approved Recyclable Materials Processing Facility. In the event 414 the City makes such a requirement, the City shall provide written notice to Contractor no less than 415 six (6) months prior to the date Contractor shall commence use of the City-designated Recyclable #6..
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Restated Service Agreement January 27, 2026 -12- City of Modesto/Bertolotti Modesto Disposal, Inc. 416 Materials Processing Facility. Contractor’s Compensation and Rates will be adjusted for increases or 417 decreases in Transportation and/or Processing costs in accordance with Section 8.2. 418 4.3 Organic Materials
419 A. Collection. Contractor shall provide Organic Materials Collection services, as described in Exhibit B. 420 B. Transfer. If Contractor plans to Transfer Organic Materials, Contractor shall Transport Organic 421 Materials to the Approved Transfer Facility where the materials will be unloaded from Collection 422 vehicles, loaded into large-capacity vehicles, and Transported to the Approved Organic Materials 423 Processing Facility. If Contractor is unable to use the Approved Transfer Facility, then Contractor 424 shall be responsible for making other Transportation arrangements. In such event, Contractor shall 425 not be compensated for any additional costs. If Contractor plans to change its Transfer method, 426 Contractor shall obtain written approval from the City thirty (30) Days prior to making the change, 427 with the exception of events constituting an excuse from performance, as similarly described in 428 Subsection 4.2.C.3.
429 C. Processing. Contractor shall Transport and deliver all Source Separated Organic Materials placed in 430 Organic Materials Containers in the Service Area to the Approved Organic Materials Processing 431 Facility. All tipping fees and other costs associated with Transporting to and Processing of such 432 Organic Materials at the Approved Organic Materials Processing Facility and Disposing of the 433 Residue shall be paid by Contractor.
434 1. Compliance with Regulatory Requirements and Applicable Law. Contractor shall observe 435 and comply with all regulations in effect at the Approved Organic Materials Processing Facility 436 and cooperate with and take direction from the operator thereof with respect to delivery of 437 Organic Materials. Contractor shall actively work with the Approved Organic Materials 438 Processing Facility operator throughout the Term of this Agreement to ensure that 439 contamination of the Organic Materials delivered to the Processing Facility remains below the 440 limits established by Approved Organic Materials Processing Facility and Applicable Law. 441 2. Load Classification. Contractor shall, at all times, follow the load classification procedures and 442 load rejection standards set forth below for all Organic Materials delivered to the Approved 443 Organic Materials Processing Facility. Contractor further acknowledges the load classification 444 procedures and load rejection standards of the Approved Organic Materials Processing 445 Facility may change from time to time, as directed by the City. Contractor shall use the 446 Approved Disposal Facility for Organic Materials loads that are rejected by the Approved 447 Organic Materials Processing Facility.
448 If the Approved Organic Materials Processing Facility identifies a load that is excessively 449 contaminated based on its visual inspection, the Approved Organic Materials Processing 450 Facility can reject that delivery from Contractor’s vehicle. 451 If the Approved Organic Materials Processing Facility rejects a load, the load shall be 452 segregated from other loads, and the Approved Organic Materials Processing Facility shall 453 immediately notify the Contractor verbally. Contractor shall follow the verbal notification 454 with a written notice that identifies the date and time of occurrence and the Approved 455 Organic Materials Processing Facility’s reason for rejection of the delivered Organic Material. 456 Contractor shall be given twenty-four (24) hours from receipt of written notice to inspect the #6..
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Restated Service Agreement January 27, 2026 -13- City of Modesto/Bertolotti Modesto Disposal, Inc. 457 load. After twenty-four (24) hours have passed since the receipt of written notice, the 458 Approved Organic Materials Processing Facility shall Process or Dispose of the load and shall 459 bill Contractor one hundred fifty dollars ($150.00) per Ton. 460 If a load contains Excluded Waste, this Section shall not be applicable. In such case, the 461 Excluded Waste shall be handled in accordance with Section 5.8. 462 3. Bags to Contain Organic Materials. Contractor shall permit City-approved Customers to use 463 Compostable Plastic bags and/or liners for containment of Organic Materials discarded in 464 Collection Containers. In the event that a Customer uses a nonconforming bag and/or liner, 465 or a non-City-approved Customer uses bags and/or liners, Contractor may consider the 466 bag/liner and its contents a contaminant. In such case, the contaminated Collection 467 Containers shall be handled in accordance with Section 5.3. The City may prohibit or restrict 468 the use of Compostable Plastics, with a six (6) months’ notice to Contractor, and this shall not 469 constitute a City-directed change in scope or Change in Law under this Agreement. 470 D. Minimizing Prohibited Container Contaminants. Contractor shall make its best efforts, including 471 those measures specifically identified in this Agreement, as well as effective industry practices that 472 may be identified during the Term of this Agreement, to reduce Prohibited Container Contaminants. 473 Contractor shall use information resulting from the Prohibited Container Contaminant monitoring 474 program and any material characterization studies performed on City Solid Waste to help propose 475 education and outreach campaigns that target specific problem materials. 476 E. City Right to Redirect Organic Materials. The City may, at any time during the Term of this 477 Agreement, require Contractor to deliver Organic Materials Collected under this Agreement to a 478 Pre-Processing Facility or Processing Facility other than the Approved Organic Materials Processing 479 Facility. In the event the City makes such a requirement, the City shall provide written notice to 480 Contractor no less than six (6) months prior to the date Contractor shall commence use of the City481 designated Organic Materials Processing Facility. Contractor’s Compensation and Rates will be 482 adjusted for increases or decreases in Transportation and/or Processing costs in accordance with 483 Section 8.2.
484 4.4 Garbage
485 A. Collection. Contractor shall offer and provide Garbage Collection services, as described in Exhibit B. 486 B. Transfer. If Contractor plans to Transfer Garbage, Contractor shall Transport Garbage to the 487 Approved Transfer Facility where the materials will be unloaded from Collection vehicles, loaded 488 into large-capacity vehicles, and Transported to the Approved Disposal Facility. If Contractor is 489 unable to use the Approved Transfer Facility, then Contractor shall be responsible for making other 490 Transportation arrangements. In such event, Contractor shall not be compensated for any 491 additional costs. If Contractor plans to change its Transfer method, Contractor shall obtain written 492 approval from the City thirty (30) Days prior to making the change, with the exception of emergency 493 conditions as described in Subsection 4.4.C.2.
494 C. Disposal. Contractor shall Transport and deliver all Garbage placed in Garbage Containers in the 495 Service Area to the Approved Disposal Facility. All tipping fees and other costs associated with 496 Transporting to and Disposal of such Garbage at the Approved Disposal Facility shall be paid by 497 Contractor.
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Restated Service Agreement January 27, 2026 -14- City of Modesto/Bertolotti Modesto Disposal, Inc. 498 1. Compliance with Regulatory Requirements and Applicable Law. Contractor shall keep all 499 existing permits and approvals necessary for use of the Approved Transfer Facility in full 500 compliance with Applicable Law. Upon request, Contractor shall provide copies of facility 501 permits and/or notices of violations (obtained from its Transfer Facility Subcontractor, if 502 necessary) to the City Contract Manager. Contractor shall observe and comply with all 503 regulations and posted rules in effect at the Approved Disposal Facility and cooperate with 504 and take direction from the operator thereof with respect to delivery of Garbage. 505 2. Notification of Excuse from Performance. Contractor shall notify the City of any unforeseen 506 operational restrictions that have been imposed upon the Approved Disposal Facility by a 507 regulatory agency or any unforeseen equipment or operational failure that will temporarily 508 prevent the Approved Disposal Facility from Disposing the Garbage Collected under this 509 Agreement.
510 If Contractor is unable to use either the Approved Transfer Facility or the Approved Disposal 511 Facility due to an event that meets the requirements for excusing Contractor from 512 performance of this specific obligation as described in Section 10.6, Contractor shall use an 513 Alternative Facility provided that Contractor provides written notice to the City Contract 514 Manager. Within forty-eight (48) hours of such excuse from performance, Contractor shall 515 provide a written description of the reasons the use of either the Approved Transfer Facility 516 or the Approved Disposal Facility is not feasible and the period of time Contractor proposes 517 to use the Alternative Facility. Such a change in either the Approved Transfer Facility or the 518 Approved Disposal Facility shall be temporarily permitted until such time as the City Contract 519 Manager is able to consider and respond to the use of the proposed Alternative Facility. If the 520 use of the proposed Alternative Facility is anticipated to, or actually does, exceed thirty (30) 521 Days in a consecutive twelve (12) month period, the use of such Alternative Facility shall be 522 subject to approval by the City Contract Manager. The City Contract Manager may, in their 523 sole discretion, approve, conditionally approve, temporarily approve, or disapprove of the 524 use of the proposed Alternative Facility. In the event that the City disapproves the use of the 525 proposed Alternative Facility, the Parties shall meet and confer to determine an acceptable 526 Facility.
527 3. Use of Alternative Facility(ies). If the use of an Alternative Facility is for reasons within 528 Contractor’s, or Subcontractor’s Control, Contractor’s Compensation shall not be adjusted for 529 any change in Transportation costs associated with use of the Alternative Facility. However, 530 if the use of an Alternative Facility is due to reasons beyond Contractor’s or its Subcontractor’s 531 Control, then the City shall adjust, either up or down, Contractor’s Compensation for changes 532 in Transportation and Processing costs associated with the use of the Alternative Facility. In 533 the event that the change in either the Approved Transfer Facility or the Approved Disposal 534 Facility results in increased costs, the City may identify and direct Contractor to a less-costly 535 Alternative Facility, at Contractor’s expense. Failure to meet the requirements of this Section 536 shall result in Liquidated Damages as identified in Exhibit F. 537 4.5 Bulky Item Collection Service
538 Contractor shall provide Bulky Item Collection services for Residential Customers, pursuant to Exhibit B. 539 Contractor shall provide Bulky Item Collection service to Single-Family Customers on the Customer’s 540 regularly scheduled Collection Day, and such Bulky Item Collection service shall be offered to the #6..
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Restated Service Agreement January 27, 2026 -15- City of Modesto/Bertolotti Modesto Disposal, Inc. 541 Customer within five (5) Working Days of Contractor’s receipt of the Customer’s request for service at no 542 additional charge. Contractor shall provide Bulky Item Collection services for Multi-Family Customers and 543 Multi-Family Dwelling Units during the first week of each month at no additional charge. Upon completion 544 of the Collection, Contractor shall submit to the City a list of all Bulky Item Collection event locations. 545 Contractor shall Transport all Collected Bulky Items to the appropriate Approved Facility for reuse, repair, 546 Processing, or Disposal based on the Reusable Materials Hierarchy. 547 Upon Customer or Generator request, in lieu of the Curbside Bulky Item Collection services described 548 above, Contractor shall issue two (2) drop-off vouchers to be used by Residential Customers and/or Multi549 Family Dwelling Units within one (1) calendar year, pursuant to Exhibit B, offered at no additional charge, 550 provided that Generator delivers Bulky Items to the Approved Transfer Facility in a vehicle or trailer no 551 larger than four (4) feet by four (4) feet by eight (8) feet. Contractor shall Transport all delivered Bulky 552 Items to the appropriate Approved Facility for reuse, repair, Processing, or Disposal based on the Reusable 553 Materials Hierarchy.
554 4.6 Used Motor Oil and Filter Collection
555 Contractor shall Collect Residential Customers’ Used Motor Oil and Filters placed Curbside for Collection, 556 as described in Exhibit B. Contractor shall not be required to Collect more than four (4) gallons of Used 557 Motor Oil and four (4) Filters per individual Dwelling Unit per week. Contractor may invoice the City for 558 each instance of Used Motor Oil and Filter Collection at the approved Rate. The City shall use grant funds 559 to reimburse Contractor for all reasonable costs associated with providing Used Motor Oil and Filter 560 Collection services, as agreed to by the City. In the event that no further grant funding is received to 561 continue the program, the City shall notify Contractor a minimum of ninety (90) Days prior to the 562 expiration of grant funding to discuss alternative funding of the program or termination of the Curbside 563 Used Motor Oil and Filter Collection program.
564 4.7 Special Events
565 Upon thirty (30) Days’ notice from the City, Contractor shall provide the special event services identified 566 in this Section. Contractor shall provide special event services at one (1) special event per year, at no cost 567 to the event or the City. Notwithstanding the foregoing, Contractor may charge events for Solid Waste 568 Collection in Bins and/or Roll-Off Boxes at the approved Commercial Rates. Special event services include:
569 A. Event Collection Stations. Contractor shall provide event Collection stations for Collection of Solid 570 Waste. Each event Collection station shall include a separate Container for each of Recyclable 571 Materials, Organic Materials, and Garbage, as approved by the City Contract Manager. Contractor 572 shall provide a sufficient number of event Collection stations with sufficient capacity to meet the 573 needs of the event, as determined by Contractor in cooperation with the event organizer. Collection 574 stations shall utilize the same Containers used to provide services to Residential Customers, unless 575 alternative Containers are approved by the City. Contractor shall provide liners/bags that comply 576 with City programs for the Carts at the Collection stations. Collection stations shall include adequate 577 signage and labeling in languages approved by the City Contract Manager. 578 B. Collection Station Monitors. Upon request, Contractor shall provide event Collection station 579 monitors, up to the number prescribed in Exhibit B5, who shall be present for the duration of each 580 special event. The City may request additional event Collection station monitors from Contractor at 581 an approved Rate. Contractor shall require event Collection station monitors to monitor event #6..
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Restated Service Agreement January 27, 2026 -16- City of Modesto/Bertolotti Modesto Disposal, Inc. 582 Collection stations and educate event attendees and vendors about what materials are acceptable 583 in each of the event Collection station Containers. 584 C. Public Education Booth. Upon request of either the City Contract Manager or the event organizer, 585 Contractor shall staff a booth or exhibit at the event, at no cost to the Contractor, for the purpose 586 of educating the public about the services, and including, but not limited to, the City’s Solid Waste 587 Division and the benefits of source reduction, reuse, repair, Recycling, Composting, and Source 588 Separating Solid Waste. Contractor shall distribute City-approved educational materials (brochures, 589 flyers, etc.) at event booths. All Contractor developed materials shall be sent to the City for approval 590 prior to distribution at the event.
591 D. Reporting. Within fourteen (14) Days of the end of the event, Contractor shall submit a report to 592 the City Contract Manager and event organizer. The report shall include, at a minimum: (i) the 593 number of event Collection stations deployed at the event; (ii) the number of event Collection 594 station monitors; (iii) the Tonnage of each material type (i.e., Recyclable Materials, Organic 595 Materials, and Garbage) Collected; and (iv) a description and number of the City-approved public 596 educational materials provided at the event.
597 Contractor may, at its sole discretion and expense, coordinate with local youth, community, or charitable 598 organizations to provide some or all of the special event required services. Regardless of Contractor’s use 599 of such an organization, Contractor shall be responsible for ensuring that special event service is provided 600 to the Customer in a professional and timely manner. 601 For special events in excess of the one (1) special events per year, Contractor shall provide the above602 described special event services at the request of the event organizer and may negotiate the charges for 603 such services with the event organizer based on the specific needs of the event. 604 4.8 Public Education and Outreach
605 Contractor acknowledges and agrees that education and public awareness are critical, key, and essential 606 elements of any efforts to achieve the City’s sustainability goals and the requirements of Applicable Law. 607 Accordingly, Contractor agrees to take direction from the City and fully cooperate to expand public and 608 Customer knowledge concerning the need to reduce, reuse, repair, recover, Recycle, Compost, and Source 609 Separate Solid Waste and the methods thereof. Contractor shall post all public education and outreach 610 materials on Contractor’s website and ensure Customer service provides relevant information to the 611 public as necessary, pursuant to Section 4.12 of the Agreement. 612 4.9 Community Clean-up Events
613 Contractor shall participate in a minimum of two (2) community clean-up events annually, as scheduled 614 and agreed upon by Contractor and the City. Contractor shall provide sufficient staff and equipment to 615 Collect Garbage, Bulky Items, and any other Solid Waste, as mutually agreed upon by the Parties. During 616 community clean-up events, the Approved Transfer Facility shall be open and available for Customers to 617 Transport Bulky Items using vouchers that are not considered to be part of the Bulky Item voucher 618 program, pursuant to Section 4.5 and Exhibit B. Contractor shall Transport, Process, and Dispose of 619 materials Collected at Community Clean-up Events in accordance with the Reusable Materials Hierarchy. 620 Contractor may charge the City for participation in community clean-up events at the approved Rate in 621 Rate Year One. For subsequent Rate Periods, the Rate shall be adjusted annually by the same Annual #6..
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Restated Service Agreement January 27, 2026 -17- City of Modesto/Bertolotti Modesto Disposal, Inc. 622 Percentage Change in the CPI-U, calculated in accordance with the adjustment method described in 623 Exhibit E.
624 Within fourteen (14) Days following the end of the community clean-up event, Contractor shall submit a 625 report to the City Contract Manager and event organizer. The report shall include, at a minimum, the 626 Tonnage of each material type Collected (i.e., Garbage and Bulky Items). Contractor shall provide the City 627 with an invoice within the fourteen (14) Days.
628 4.10 Illegal Dumping
629 In instances when Contractor has received a written request from the City to Collect illegally dumped 630 items at a specific location in the Public Right-of-Way, Contractor shall Collect illegally dumped items from 631 such location within two (2) Working Days of the City Contract Manager or their designee’s request. 632 Contractor may bill the City for staff, equipment, and Processing and/or Disposal fees at the City-approved 633 Rate in Exhibit G.
634 All written requests from the City will include a list of specific location(s) where Contractor can locate 635 illegally dumped items for Collection, along with time-stamped photographic evidence of the specific 636 location(s) of illegally dumped items. Upon completion of the Collection, Contractor shall submit back to 637 the City time-stamped photographic evidence for each specific location. The photographic evidence 638 should match the surroundings, view, and angle of the photographic evidence provided by the City. 639 Failure to Collect illegally dumped items and provide photographic evidence of such Collection in 640 accordance with this Section shall result in Liquidated Damages as identified in Exhibit F. 641 4.11 Billing
642 A. General. Contractor shall bill Single Family Customers on a monthly basis in arrears of services 643 provided, unless otherwise agreed to by the City in writing. Contractor shall bill all Commercial 644 Customers for scheduled and regularly recurring services on a monthly basis in arrears of services 645 provided. Contractor shall bill all Multi-Family Customers for scheduled and regularly recurring 646 services on a bi-monthly basis mid-cycle of services provided. Contractor shall bill all Customers for 647 any on-call and/or non-recurring services no more frequently than monthly and may only bill for 648 services provided during the previous two (2) months. Contractor shall remit invoices to Customers 649 no later than the twentieth (20th) Day of the month following the period for which service is being 650 billed and following the period for on-call and/or non-recurring services. Contractor shall be solely 651 responsible for collecting billings at Rates set in accordance with Article 8. Billing shall be performed 652 on the basis of services rendered and this Agreement shall create no obligation on the part of any 653 Person on the sole basis of the Ownership of property. Individual contracts between Contractor and 654 a Customer for services provided under this Agreement shall be prohibited. 655 B. Customer Accounts. Contractor shall develop, maintain, and regularly use a Customer Account 656 Information Database, which shall include but is not limited to:
657 1. Customer name.
658 2. Phone number.
659 3. Service address.
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Restated Service Agreement January 27, 2026 -18- City of Modesto/Bertolotti Modesto Disposal, Inc. 660 4. Billing address.
661 5. Email address.
662 6. Customer service levels, including:
663 a. Number and type of containers.
664 b. Container numbers.
665 c. Service frequency.
666 d. Customer service levels exceptions.
667 e. Customer service waivers.
668 f. Shared Container information.
669 C. Billing Procedures. Contractor shall bill Customers electronically using paperless invoices; however, 670 Contractor shall bill Customers who decline or are otherwise unable to provide email contact 671 information by standard mail, using standard (paper) invoices. Contractor shall permit Customers 672 the ability to pay their bills through an electronic check or credit card and include the ability for 673 Customer billings to be automatically charged on a recurring basis. Contractor shall prepare, mail, 674 and collect bills from Customers who decline to use such internet-based billing system. Contractor 675 shall make arrangements to allow such Customers to pay bills by cash, check, electronic check, 676 money order, and credit card.
677 D. Billing Inserts. Up to once per billing cycle for each Customer Type, the City may direct Contractor 678 to attach inserts, provided by the City, to Customer invoices. Contractor shall provide electronic bill 679 inserts to Customers who are billed electronically, and paper bill inserts to Customers who receive 680 paper bills. Electronic bill inserts/attachments must be readily available for the Customer to view 681 upon receipt of the invoice (attachments shall not be provided as links). All inserts must receive City 682 approval prior to distribution. Upon City request for such attachments, Contractor shall comply with 683 such request during its next billing cycle for the targeted Customer group. Contractor shall perform 684 this service with no additional requirement for compensation. 685 E. Record Storage. Contractor shall maintain copies of all billings and receipts, each in chronological 686 order, or stored digitally and sortable by date, for the Term of this Agreement plus five (5) years 687 after its expiration or earlier termination, for inspection and verification by the City Contract 688 Manager, or their designee, at any reasonable time but in no case more than thirty (30) Days after 689 receiving a request to do so.
690 F. Bad Debt. Contractor shall be responsible for collection of payment from Customers billed by 691 Contractor with past due accounts (bad debt) in accordance with this Section 4.11. In no 692 circumstance shall bad debt offset any fees, payments, or amounts owed by Contractor to City 693 under this Agreement. Contractor shall make reasonable efforts to obtain payment from delinquent 694 accounts through issuance of late payment notices, telephone requests for payments, and 695 assistance from collection agencies.
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Restated Service Agreement January 27, 2026 -19- City of Modesto/Bertolotti Modesto Disposal, Inc. 696 1. Delinquency Notices & Late Fees. Monthly Customer invoices shall be due thirty (30) Days 697 from the first Day of the billing period. In the event that any account becomes more than 698 thirty (30) Days past due, Contractor shall notify such Customer of the delinquency via written 699 correspondence, instructing the Customer that unpaid bills more than forty-five (45) Days 700 delinquent may be assessed a one and one half percent (1.5%) late fee per month. Should any 701 account become more than sixty (60) Days past due, Contractor may discontinue providing 702 service to the Customer. Contractor shall notify the City Contract Manager of the address, 703 Service Level, service frequency, and delinquent billing amount at least seven (7) Days before 704 discontinuing service to any Customer. Contractor may withhold service from a delinquent 705 account until past delinquencies are paid in full. Upon restoring service to a previously 706 delinquent account, Contractor may require a deposit from the Customer not to exceed one 707 (1) month’s billing at the Customer’s Service Level. The provisions of this Section shall apply 708 unless the City Contract Manager establishes an alternative process in writing. 709 G. Failure to Invoice. If Contractor fails to invoice a Customer or otherwise undercharges a Customer 710 for services provided for more than six (6) months, Contractor may not subsequently attempt to 711 collect the undercharged amount for more than six (6) months of service. If Contractor overcharges 712 a Customer for a period of more than six (6) months, Contractor shall reimburse or credit the 713 Customer for at least six (6) months of the overcharged service. This Agreement does not prohibit 714 Contractor from reimbursing or crediting a Customer for more than six (6) months of overcharges. 715 H. Service Changes or Cancellations. If a Customer changes or cancels service during a billing cycle, 716 the Customer shall be entitled to a proration of the billing from the date that the service change 717 was requested, in the case of cancellations or reductions in the Customer’s bill, or the date the 718 service change was fulfilled, in the case of increases in the Customer’s bill. 719 4.12 Customer Service Program
720 Contractor shall submit to the City, for review and approval on or before the Commencement Date, a 721 written Customer Service Plan, attached as Exhibit C, outlining the Customer service program, including 722 program requirements as provided in this Article.
723 4.12.1 Program Requirements
724 A. Availability of Representatives. A representative of Contractor who is knowledgeable of the Service 725 Area, services, and Rates shall be available on Working Days from 8:00 a.m. to 4:30 p.m. Pacific 726 Standard Time (PST) Monday through Friday, to communicate with the public in-person or by 727 telephone. Contractor shall also maintain an after-hours telephone number allowing twenty-four 728 (24) hour per Day access to Contractor’s management by the City Contract Manager in the event of 729 an emergency involving Contractor’s equipment or services, including, but not necessarily limited 730 to, fires, blocked access, or property damage.
731 B. Telephone. Contractor shall secure, use, pay all costs incurred by, and maintain during the Term of 732 this Agreement, a local or toll-free phone number that shall serve as the primary point of contact 733 between Contractor and the public as outlined in Subsection 4.12.1.A on all Working Days. 734 Contractor shall provide the City with a separate emergency telephone number for use by the City 735 Contract Manager, or their designee, outside normal business hours, with a representative available 736 twenty-four (24) hour per Day, as outlined in Subsection 4.12.1.A. #6..
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Restated Service Agreement January 27, 2026 -20- City of Modesto/Bertolotti Modesto Disposal, Inc. 737 Contractor shall have sufficient equipment and staff representatives in place, or an answering 738 service, to handle the volume of calls to the local or toll-free number experienced on the busiest 739 Days. Such telephone equipment shall be capable of recording the responsiveness to calls, 740 including, but not limited to, per-call on-hold time and average on-hold time. Contractor’s 741 telephone system shall offer Customers who have been placed on hold to opt to leave a voice 742 message or email, rather than remain on hold. The average amount of time that the Customer is 743 left on hold during any given month, including the amount of time a Customer is left on hold after 744 a Customer service representative has answered the call, shall not exceed three (3) minutes, and 745 no Customer shall be left on hold for more than ten (10) minutes. In the event that Contractor’s 746 telephone Customer service performance falls below the performance standards established in 747 Exhibit F, the City shall have the right to require Contractor to increase its staffing levels and/or call 748 handling capacity without requirement for any additional compensation to Contractor. Recording 749 of Contractor’s responsiveness to calls shall include, at a minimum, all items included in the Service 750 Quality and Reliability and Customer service performance standards listed in Exhibit F. An answering 751 machine or voicemail service shall record Customer calls twenty-four (24) hour per Day, seven (7) 752 Days per week. Contractor shall provide a live, not automated, call back on the same Day to all 753 Customers who leave voice messages by 2:00 p.m. PST on Monday through Friday and shall provide 754 a live call back by noon of the following Working Day for any voice messages left after 2:00 p.m. PST 755 Monday through Friday. Contractor shall designate one (1) member of Contractor staff to work 756 directly with City in response to inquiries received by the City on Working Days from 8 a.m. to 4:30 757 p.m. PST Monday through Friday.
758 C. Website and Email Access. Contractor shall develop and maintain content on a website that is 759 accessible by the public and shall have web page(s) dedicated to the operations under this 760 Agreement in the City. Contractor’s website shall include all Rates allowed to be charged under the 761 Agreement, City designed and approved public education and outreach materials, and the ability 762 for the public to email questions, service requests, schedule Bulky Item pickups, or Complaints to 763 Contractor. The website shall be reviewed and updated at least once per quarter, or more 764 frequently as directed by the City Contract Manager. Substantive changes to the dedicated web 765 page(s) related to operations under this Agreement in the City shall be preapproved by the City 766 Contract Manager, and all City designed public education and outreach materials that the City or 767 the City Contract Manager requests to be updated on the website shall be updated within ten (10) 768 Business Days of the request. Contractor shall respond the same Day to all Customers who send 769 email messages by 2:00 p.m. PST on Monday through Friday and shall respond by noon of the 770 following Working Day for any email messages sent after 2:00 p.m. PST Monday through Friday. 771 Contractor shall respond to Customer emails with an email; however, Contractor may also respond 772 via phone.
773 4.12.2 Service Requests, Complaints
774 Contractor shall be responsible for the prompt and courteous attention to, and prompt and reasonable 775 resolution of, all Customer service requests and Complaints. Contractor shall record, in its computer 776 system or a separate log, as approved by the City Contract Manager, all Complaints, noting the name and 777 address of complainant, date of Complaint, nature of Complaint, and nature and date of resolution. 778 Contractor shall retain this Complaint log for the Term. Contractor shall record and respond to all 779 Complaints as communicated by the Customer, utilizing a “Customer is always right” approach. If 780 Contractor has reason to believe that a Customer’s Complaint is invalid or repetitive, Contractor may #6..
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Restated Service Agreement January 27, 2026 -21- City of Modesto/Bertolotti Modesto Disposal, Inc. 781 present the basis for their belief to the City Contract Manager who may in their sole discretion modify the 782 approach of this Section with respect to such Customer. 783 Contractor shall respond to all Complaints received in accordance with the requirements of Subsections 784 4.12.1.B and 4.12.1.C. All Complaints shall be resolved within three (3) Business Days, unless otherwise 785 agreed upon by the City. Complaints related to missed Collections shall be addressed in accordance with 786 Subsection 4.12.3. Complaints related to repair or replacement of Carts or Bins shall be addressed in 787 accordance with Section 5.6. Complaints that require City involvement shall be referred to the City within 788 twenty-four (24) hours of receipt of such Complaint. 789 4.12.3 Missed Collections
790 A. Schedule for Resolution. Contractor shall resolve each and every Customer Complaint of a missed 791 or incomplete Collection by returning to the Customer address and completing the Collection. For 792 all Complaints related to missed Collections that are received by 2:00 p.m. Monday through Friday 793 (excluding Holidays), Contractor shall return to the Customer address and Collect the missed 794 materials on the same Day that the missed Collection was reported, during permitted hours of 795 Collection. For those Complaints related to missed Collections that are received after 2:00 p.m. 796 Monday through Friday (excluding Holidays), Contractor shall have until the end of the following 797 Working Day to resolve the Complaint.
798 Contractor shall not be required to return and complete a Collection in response to a Complaint if 799 Contractor’s driver has left a non-Collection notice in accordance with Section 5.3 or if otherwise 800 approved by the City.
801 B. Courtesy Collections for Admitted Late Set-Outs. In the event that a Customer: (i) reports that their 802 Container(s) were placed for Collection after Contractor’s Collection vehicle had already passed the 803 Premises for regularly scheduled Collection; (ii) does not claim that Contractor missed the 804 Collection; and (iii) requests that Contractor return and Collect their Containers, Contractor shall 805 return to the Customer Premises and provide a courtesy Collection at no charge to the Customer. 806 Contractor is not required to provide more than two (2) courtesy Collections for admitted late set807 outs per Customer per calendar year. For Residential Customers, one (1) courtesy Collection 808 incident represents Collection of up to three (3) Carts (Recyclable Materials, Organic Materials, and 809 Garbage). For Commercial Customers, one (1) courtesy Collection represents Collection of one (1) 810 Container. Contractor shall complete the courtesy Collection by the end of the following Working 811 Day. The provisions of this Section shall only apply if the Customer acknowledges, and Contractor 812 documents in writing, that the event did not constitute a missed or incomplete Collection event by 813 Contractor.
814 4.12.4 SB 1383 Non-Compliance Complaints
815 For Complaints received in which the Person alleges that an entity is in violation of SB 1383 requirements, 816 Contractor shall document the information listed in Exhibit D. Contractor shall provide this information in 817 a monthly summary report of SB 1383 non-compliance Complaints in accordance with Exhibit D. 818 4.12.5 Customer Service Reporting
819 Contractor shall track each and every Customer Service interaction and report such activity to the City. 820 Reports shall be submitted in accordance with Section 6.2 and Exhibit D. #6..
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Restated Service Agreement January 27, 2026 -22- City of Modesto/Bertolotti Modesto Disposal, Inc. 821
822 4.13 Service Exemptions
823 Contractor shall honor any service exemption(s) granted by the City Contract Manager that is consistent 824 with Applicable Law.
825 4.14 Waste Generation and Characterization Studies
826 Contractor agrees to participate in up to one (1) annual independent waste generation and 827 characterization study as directed by the City during the Term of this Agreement, as described in Exhibit 828 B4. The City shall have full authority over the direction of the study and Contractor shall cooperate fully 829 with the City. Contractor shall pay a Waste Generation and Characterization Reimbursement in 830 accordance with Section 7.4.
831 Additionally, upon request of the City Contract Manager, Contractor shall give City (or its designee) access 832 to the contents of Containers of individual Customers. Contractor shall arrange for the contents of any 833 Containers to be Transported to a facility where the Container’s contents can be viewed for 834 contamination, at no charge to the City. Such access and Transport shall occur within mutually agreed 835 upon timeframes between the City and Contractor.
836 4.15 Extended Producer Responsibility Programs
837 A. General. The City and Contractor acknowledge that the requirements under the existing Extended 838 Producer Responsibility Programs (including, but not limited to, AB 1201, SB 1383, SB 54, and SB 839 343) may be applicable to the services provided by Contractor under this Agreement, and that 840 additional or amended Extended Producer Responsibility Programs may be established in the 841 future. Contractor acknowledges and agrees that to the extent that such Extended Producer 842 Responsibility Programs impose requirements on the City’s Solid Waste Collection programs, which 843 impact the services provided by Contractor under this Agreement, those Extended Producer 844 Responsibility Programs shall be considered “mandatory” for Contractor and Contractor shall be 845 required to participate.
846 B. Change in Scope. The City may require Contractor’s compliance with, and participation in, existing 847 and/or new mandatory Extended Producer Responsibility Programs that may include a modification 848 to Exhibit B, to the extent that doing so is reasonably appropriate and does not violate the permits 849 of the subject Approved Facility(ies).
850 Any and all such City requests and/or requirements related to any mandatory or voluntary Extended 851 Producer Responsibility Program shall be treated as a change in scope in accordance with Sections 852 3.5 and shall not be treated as a Change in Law.
853 C. City’s Rights to Solicit Proposals. The City may, from time to time, request that Contractor initiate 854 or participate in an Extended Producer Responsibility Program. In such case, Contractor shall 855 present, within thirty (30) Days of City’s request, unless an alternate schedule is mutually agreed 856 upon, a written proposal to provide such services. If Contractor declines to provide such services, 857 the City may solicit proposals from other Persons related to Extended Producer Responsibility 858 Programs and may permit other Persons besides Contractor to provide such services, and that #6..
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Restated Service Agreement January 27, 2026 -23- City of Modesto/Bertolotti Modesto Disposal, Inc. 859 nothing herein shall prevent the City from also soliciting cost and operating information from other 860 Persons in order to inform the City’s evaluation of any Contractor-provided proposal. 861 D. City Requested Proposal. If the City requests an Extended Producer Responsibility Program 862 proposal from Contractor under this Section, Contractor shall be required to seek out and 863 coordinate with the applicable Stewardship Organization designated for the program and shall 864 describe such partnership in its proposal or provide information about an alternative program that 865 Contractor wishes to participate in to Divert such material(s) that meets the requirements of the 866 voluntary Extended Producer Responsibility Program; these requirements are in addition to the 867 requirements provided in Section 3.4. The City’s written request for a proposal may also require 868 additional and/or specific information relating to the Extended Producer Responsibility Program, 869 including such information determined by the City Contract Manager to be reasonably necessary. 870 The City shall review the proposal and may request additional supporting documentation, 871 calculations, or other information necessary to evaluate Contractor’s proposal for reasonableness 872 and Contractor’s ability to comply with the requirements of the Extended Producer Responsibility 873 Program.
874 As such, Contractor shall consider in good faith the City’s request to enact the voluntary Extended 875 Producer Responsibility program, unless Contractor can demonstrate significant barriers that would 876 make providing such services impracticable and/or that Contractor is already Diverting the 877 applicable material(s) at the time of the City’s request. Contractor shall express any objections or 878 concerns during the meet-and-confer period and Contractor shall include evidence of such barriers 879 and/or current diversion operations in Contractor’s proposal. Such information will be further 880 reviewed by the City. In the event that Contractor and the City mutually agree for Contractor to 881 participate in a voluntary Extended Producer Responsibility Program, the Parties agree that 882 participation shall be treated as a change in scope in accordance with Sections 3.5 and shall not be 883 treated as a Change in Law.
884 E. Recordkeeping and Reporting. Throughout the Term of this Agreement, Contractor shall maintain 885 records of all funding or other resources Contractor receives directly or indirectly through an 886 Extended Producer Responsibility Program. Contractor shall inform and report to the City, as part 887 of Contractor’s obligations under Exhibit D, and shall calculate and demonstrate the dollar amount 888 that can be attributed to services provided under this Agreement. Any cost savings identified shall 889 be remitted to the City as either a direct payment sent to the City within thirty (30) Days after 890 Contractor’s receipt of funds or as a reduction to Contractor’s Compensation in accordance with 891 Article 8, at the City Contract Manager’s sole discretion. Contractor shall include copies of invoices 892 or receipts with the applicable Stewardship Organization with its payment, as appropriate, 893 regardless of whether the City is aware of such funding or other resources have been received by 894 Contractor.
895 Contractor shall also maintain all operational and financial records related to Extended Producer 896 Responsibility Programs, as provided in Article 6, and report such information to the City in 897 accordance with Exhibit D or as otherwise requested by the City Contract Manager. #6..
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Restated Service Agreement January 27, 2026 -24- City of Modesto/Bertolotti Modesto Disposal, Inc. 898 ARTICLE 5.
899 STANDARD OF PERFORMANCE
900 5.1 General
901 Contractor shall at all times comply with Applicable Law and provide services in a manner that is safe to 902 the public and Contractor’s employees.
903 5.2 Operating Hours and Schedules
904 A. Hours of Collection. Unless otherwise authorized by the City Contract Manager, Contractor’s Days 905 and hours for Collection operations shall be as follows:
906 1. Residential Premises. Collection from Residential Premises shall only occur between the 907 hours of 6:00 a.m. and 6:00 p.m., Monday through Saturday. 908 2. Commercial Premises. Collection from Commercial Premises that are two hundred (200) feet 909 or less from Residential Premises shall only occur between the hours of 6:00 a.m. and 6:00 910 p.m., Monday through Saturday. Collection from Commercial Premises more than two 911 hundred (200) feet from Residential Premises shall only occur between the hours of 6:00 a.m. 912 and 9:00 p.m., Monday through Saturday.
913 3. City Facilities. The Collection schedule for City facilities shall be the same as Commercial 914 Premises specified in Subsection 5.2.A.2 above.
915 B. Changes in Collection Routes. Prior to Commencement Date, Contractor shall provide the City with 916 route maps identifying at a minimum: the type of route (e.g., Cart, Bin, material type, and the service 917 Day). If a standard Collection route is changed, Contractor must notify all affected Customers using 918 printed and electronic City-approved notices fourteen (14) Days prior to Contractor implementing 919 the new route.
920 C. Holiday Collection. Contractor, at its sole discretion, may choose not to provide Collection services 921 on a Holiday. In such event, Contractor shall provide Single-Family Collection services on the Day 922 following the Holiday, thereby adjusting subsequent work that week with normally scheduled Friday 923 Collection services being performed on Saturday; however, Customer service Days shall be returned 924 to the normal schedule by the following Monday. Multi-Family, Commercial, and City Collection 925 services shall be adjusted as agreed between Contractor and the Customer, but must meet the 926 minimum frequency requirement of one (1) time per week. 927 5.3 Collection Standards
928 A. Servicing Containers. Contractor shall Collect and return each Container to the location where the 929 Occupant placed the Container for Collection. Contractor shall place the Containers upright with lids 930 properly secured. For Customers other than Single-Family Residential Customers, Contractor shall, 931 without additional charge to the Customer, pull or push Containers up to fifteen (15) feet from the 932 location where the Occupant placed the Container for Collection to the Collection vehicle for 933 service.
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Restated Service Agreement January 27, 2026 -25- City of Modesto/Bertolotti Modesto Disposal, Inc. 934 Contractor, at the request of Customers, may provide special services including: (i) providing at the 935 Customer’s expense, a lock and key to the enclosure; or (ii) pulling or pushing Containers distances 936 greater than fifteen (15) feet. Contractor may charge Customers for such extra services in 937 accordance with Article 8.
938 Contractor may require Customers on private roads to sign road damage liability waivers prior to 939 operating on such private streets. If Customers on private roads fail to sign such waivers, Contractor 940 may, upon approval from the City Contract Manager, which may or may not be conditional, require 941 Customer to receive service at the nearest Public Right-of-Way. 942 B. Non-Collection, Courtesy Noticing. In the event that Contractor encounters circumstances at a 943 Customer Premises that prevents Contractor from Collecting Solid Waste that have been placed for 944 Collection, Contractor shall leave a City-approved non-Collection notice at the Customer Premises 945 clearly explaining Contractor’s reason for refusal to Collect the Solid Waste. Contractor may leave 946 the non-Collection notice on a Customer’s door, gate, or Container. Contractor shall not be required 947 to Collect Solid Waste that are reasonably believed to contain Excluded Waste, pursuant to the 948 requirements of Section 5.8. Contractor may refuse to Collect Recyclable Materials, Organic 949 Materials, or Garbage Containers that are contaminated in accordance with Exhibit B, and shall 950 leave a City-approved non-Collection notice informing Customer how to properly separate 951 materials. If Contractor intentionally refuses to Collect Solid Waste, but does not leave a non952 Collection notice, it shall be considered a Missed Collection per Subsection 4.12.3. Contractor may 953 propose an alternative to a paper non-Collection notice left at Customer Premises (e.g., Customer 954 notification via a phone call or email), subject to City approval. Such an alternative must involve 955 proactive communication with Customer, initiated by Contractor. 956 Contractor and Customers may mutually agree to uncommon service locations, if necessary for 957 Collection in specific areas (e.g., setting out all of the Carts in a court in a line down the middle of 958 the court as opposed to Curbside.)
959 C. Litter Abatement. Contractor shall use proper care to prevent spills or leaks of material placed for 960 Collection, fuel, and other vehicle fluids while providing services under this Agreement. If any 961 materials are spilled or leaked during Collection and Transportation, Contractor shall clean up all 962 spills or leaks before leaving the site of the spill and notify the City Contract Manager within twenty963 four (24) hours. Contractor’s vehicles shall be equipped at all times with spill kits, including, but not 964 limited to, a broom, shovel, and absorbent.
965 Contractor shall not Transfer loads from one (1) vehicle to another on any Public Street, unless it is 966 necessary to do so because of mechanical failure, combustion of material in the truck, or accidental 967 damage to a vehicle.
968 Contractor shall cover all open Roll-Off Boxes at the pickup location before Transporting materials 969 to the Approved Facility, in accordance with Applicable Law. 970 Contractor shall conduct staff training on best management practices for litter abatement at no 971 extra charge. Such best management practices include, without limitation:
972 1. Closing Container lids and right sizing service: Contractor staff will tag overfull Containers with 973 City-approved courtesy notices, which will serve as outreach and education to the Customer. 974 Photos of the Container will be taken by drivers and submitted to the City. Such photos will #6..
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Restated Service Agreement January 27, 2026 -26- City of Modesto/Bertolotti Modesto Disposal, Inc. 975 be available to outreach and Customer service staff in order to demonstrate to the Customer 976 where the problem exists.
977 2. Driver training on litter reduction techniques and litter removal best management practices, 978 and affixing signage to the back of Contractor trucks that provides a phone number for 979 residents to report material spills.
980 D. No Commingling of Materials. Contractor shall Collect materials generated in the City in Collection 981 vehicles separately from other materials generated outside the City Service Area, unless otherwise 982 approved by the City Contract Manager. Contractor shall not commingle materials that have been 983 Source Separated with other material types (for example, Source Separated Recyclable Materials 984 that have been properly placed for Collection shall not be combined with Source Separated Organic 985 Materials or Garbage). Contractor shall report Collected material Tonnage in accordance with 986 Exhibit D.
987 If Contractor must place a Container in the Public Right-of-Way to facilitate Collection, Contractor 988 shall not permit the Container to remain in the Public Right-of-Way over one (1) hour. If the 989 Container is stored under a chute for Collection, the Container must be serviced and returned 990 immediately.
991 E. Container Roll-Out Service. Contractor shall provide Container Roll-Out Service to Commercial 992 Customers, whereby Contractor will move Containers manually to facilitate Collection. Push-out 993 service up to fifteen (15) feet from the Enclosure/Container location to the Collection vehicle will 994 be provided at no additional charge (push up to 15 feet then return). Contractor may charge the 995 Customer the Container Roll-Out Service fee, included in the approved Rate schedule, for push-out 996 service in excess of fifteen (15) feet.
997 5.4 Transfer and Processing Standards
998 5.4.1 Equipment and Supplies
999 Contractor shall equip and operate the Approved Processing Facilities in a manner to fulfill Contractor’s 1000 obligations under this Agreement. Contractor is solely responsible for the adequacy, safety, and suitability 1001 of the Approved Facilities. Contractor shall modify, enhance, and/or improve the Approved Facilities as 1002 needed to fulfill services under this Agreement.
1003 Contractor shall provide all rolling stock, stationary equipment, material storage Containers, spare parts, 1004 maintenance supplies, Transfer, Transport, and Processing equipment, and other consumables as 1005 appropriate and necessary to operate the Approved Processing Facilities and provide all services required 1006 by this Agreement. Contractor shall place the equipment in the charge of competent operators. 1007 Contractor shall repair and maintain all equipment at its own cost and expense. 1008 5.4.2 Scales and Weighing
1009 Contractor is solely responsible for ensuring accurate weighing of all materials entering and leaving the 1010 Approved Processing Facilities.
1011 A. Facility Scales. Contractor shall maintain State-certified motor vehicle scales in accordance with 1012 Applicable Law. Contractor shall provide back-up generator(s) capable of supplying power to the 1013 scales in the event of a power outage. Contractor shall promptly arrange for use of substitute #6..
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Restated Service Agreement January 27, 2026 -27- City of Modesto/Bertolotti Modesto Disposal, Inc. 1014 portable scales should its usual scales not be available for whatever reason. Pending substitution of 1015 portable scales, Contractor shall, as necessary, estimate the Tonnages of materials delivered to and 1016 Transported from the Approved Processing Facilities, on the basis of delivery vehicle and Transfer 1017 trailer volumes, tare weights, and/or other available facility weight records. These estimates shall 1018 take the place of actual weights while scales are inoperable and shall be identified as estimates in 1019 electronic records and reporting. Contractor shall make those records and reports available, upon 1020 request of the City, within forty-eight (48) hours of a City request. 1021 B. Tare Weights. Less than thirty (30) Days prior to the Commencement Date, Contractor shall ensure 1022 that all vehicles used by Contractor to deliver Recyclable Materials, Organic Materials, and Garbage 1023 to the Approved Processing Facilities are weighed to determine unloaded (tare) weights. Contractor 1024 shall electronically record the tare weight, identify vehicle as Contractor-owned, and provide a 1025 distinct vehicle identification number for each vehicle. Contractor shall provide City with a report 1026 listing the vehicle tare weight information upon request. Contractor shall promptly weigh additional 1027 or replacement vehicles prior to placing them into service. Contractor shall check tare weights at 1028 least annually, or within fourteen (14) Days of a City request, and shall re-tare vehicles immediately 1029 after any major maintenance or service event.
1030 C. Testing. Contractor shall test and calibrate all scales in accordance with Applicable Law, but at least 1031 every twelve (12) months. Contractor shall make those records and reports available, upon request 1032 of the City, within forty-eight (48) hours of a City request. 1033 D. Records & Inspection. Contractor shall maintain scale records and reports that provide the 1034 following information: date of receipt, inbound time, inbound and outbound weights of vehicles, 1035 and vehicle identification number. Contractor shall make those records and reports available, upon 1036 request of the City, within forty-eight (48) hours of a City request. Contractor shall also maintain 1037 scale records and reports providing historical vehicle tare weights for each vehicle, and the date and 1038 location for each tare weight recorded. The City reserves the right to inspect such records upon 1039 three (3) Days’ notice. The City’s right to inspection also includes right to inspect Approved Facility 1040 operations.
1041 E. Upon-Request Reporting. If vehicle receiving and unloading operations are recorded on video 1042 cameras at the Approved Facilities, Contractor shall make those videos available for City review 1043 during the Approved Facility’s operating hours, upon request of the City, and shall provide the name 1044 of the driver of any particular truck if available. 1045 5.5 Collection Vehicle Requirements
1046 A. Vehicle Requirements. Contractor shall provide a fleet of Collection vehicles sufficient in number 1047 and capacity to efficiently perform the work required by the Agreement in strict accordance with 1048 its terms. Contractor shall have sufficient back-up vehicles available for each type of Collection 1049 vehicle used to respond to scheduled and unscheduled maintenance, service requests, Complaints, 1050 and emergencies.
1051 1. All such vehicles shall have watertight bodies designed to prevent leakage, spillage, or 1052 overflow. All such vehicles shall meet the Best Available Control Technology (BACT) for the 1053 year in which such vehicle is purchased (e.g., vehicles purchased in 2025 must meet BACT for #6..
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Restated Service Agreement January 27, 2026 -28- City of Modesto/Bertolotti Modesto Disposal, Inc. 1054 year 2025) and generally comply with Applicable Law. Contractor’s vehicles shall utilize 1055 Recycled motor oil to the extent practicable.
1056 2. Collection vehicles shall present a neat and clean appearance while providing service under 1057 this Agreement.
1058 3. All Collection vehicles shall comply at all times with Applicable Law, including, but not limited 1059 to, the California Air Resources Board (CARB) Truck and Bus Regulation (13 CCR 2025) and the 1060 Advanced Clean Fleet Regulations (13 CCR 1963-1963.5 and 2012-2012.2), including any 1061 modifications, administrative or legal determinations, and amendments thereto. The Parties 1062 acknowledge the requirements of the Advanced Clean Fleet Regulations adopted by CARB in 1063 2023, and Contractor acknowledges that vehicles with a gross vehicle weight rating greater 1064 than 8,500 pounds and light-duty package delivery vehicles operated in California may be 1065 subject to the CARB Clean Fleet Regulations. Contractor’s Collection vehicles may therefore 1066 be subject to requirements to reduce emissions of air pollutants. All Collection vehicles shall 1067 meet on-road heavy-duty vehicle emissions requirements for the model year the vehicle was 1068 put into service and comply with all Federal, State, and local laws and regulations. Contractor 1069 acknowledges that compliance with the Advanced Clean Fleet Regulation, as it may be 1070 amended throughout the Term, is required. The Parties further acknowledge that Contractor 1071 may petition the City for an adjustment to the Rates in excess of the annual adjustment 1072 described in Section 8.2 to compensate Contractor for materially increased costs of providing 1073 services arising out of, but not limited to, compliance with Advanced Clean Fleet Regulations, 1074 or a City-directed change in scope. Contractor’s obligation to transition to a zero-emission 1075 fleet and all associated costs shall not burden the City disproportionately compared to other 1076 jurisdictions or agencies serviced by Contractor or its Affiliates. If Contractor expands its fleet 1077 as a result of new, expanded, or extended service contracts, or an expansion into new market 1078 areas, the City shall benefit proportionately from that expansion of services and impacts on 1079 Contractor’s fleet.
1080 B. Vehicle Display. Contractor's name and local telephone number shall be displayed on all vehicles in 1081 at least four (4) inch characters.
1082 C. Vehicle Maintenance. Contractor shall maintain all of its vehicles and equipment used in providing 1083 service under this Agreement in a good, safe, neat, clean, and operable condition at all times. 1084 Vehicles used in the Collection of Solid Waste shall be painted and washed so as to present a clean 1085 appearance. Contractor shall repair, or arrange for the repair of, all of its vehicles for which repairs 1086 are needed because of an accident, breakdown, or any other cause so as to maintain all equipment 1087 in a safe and operable condition. Contractor shall maintain accurate records of repairs. 1088 D. Inspection. Contractor shall inspect each vehicle daily to ensure that all equipment is operating 1089 properly. Vehicles that are not operating properly shall be taken out of service until they are 1090 repaired and operate properly. Contractor shall repair, or arrange for the repair of, all of its vehicles 1091 and equipment in accordance with Subsection 5.5.C. If any vehicle fails to meet California Highway 1092 Patrol’s Basic Inspection of Terminals standards, Contractor shall report the findings of inspection 1093 to the City within forty-eight (48) hours of failed inspection. The City Contract Manager may inspect 1094 vehicles at any reasonable time, and within three (3) Days of the City Contract Manager’s request, 1095 to determine compliance with sanitation requirements. #6..
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Restated Service Agreement January 27, 2026 -29- City of Modesto/Bertolotti Modesto Disposal, Inc. 1096 E. Vehicle Operations. All Collection operations shall be conducted as quietly as possible and shall 1097 conform to applicable Federal, State, County, and City noise level regulations, including the 1098 requirement that the noise level during the stationary compaction process not exceed fifty (50) 1099 decibels in Residential areas and sixty-five (65) decibels in Commercial areas. All decibel readings 1100 shall be based on a distance of ten (10) feet from any part of the vehicle. The City may request 1101 Contractor to check any piece of equipment for conformance with the noise limits in response to 1102 Complaints and/or when the City Contract Manager believes it is reasonable to do so. 1103 5.6 Container Requirements
1104 A. Containers Provided to Customers. On or before the Commencement Date, Contractor shall 1105 provide Customers (including Single-Family, Multi-Family, Commercial, and City facility Customers) 1106 with Collection Containers, as requested by the Customer, to meet its minimum Service Level. 1107 Contractor shall provide Containers for storage and Collection of Organic Materials, Recyclable 1108 Materials, and Garbage to new Customers requesting service initiation within three (3) Working 1109 Days of Contractor’s first receipt of the Customer request. Contractor-provided Containers to new 1110 Customers shall be new Containers or clean used Containers and shall comply with the Container 1111 standards set forth in this Section. Contractor is not required to replace functional Containers for 1112 existing Customers upon Commencement of this Agreement. 1113 All new Container lids purchased under this Agreement shall display the City’s name, logo, 1114 telephone number described in Subsection 4.12.1, website, and a standardized identifying 1115 inventory or serial number.
1116 B. Container Standards.
1117 1. All Carts shall be manufactured by injection or rotational molding methods. The Cart 1118 handles and handle mounts may be an integrally molded part of the Cart body or molded 1119 as part of the lid. The Cart handles shall provide comfortable gripping area for pulling or 1120 pushing the Cart or lifting the lid. Pinch points are unacceptable. Carts provided to 1121 Customer shall have a useful life of ten (10) or more years, as evidenced by a 1122 manufacturer’s warranty or other documentation acceptable to the City. 1123 2. Carts shall remain durable by meeting the following durability requirements, at a 1124 minimum, to satisfy its intended use and performance for the Term of this Agreement: (i) 1125 maintain its original shape and appearance; (ii) be resistant to kicks and blows; (iii) require 1126 no routine maintenance and essentially be maintenance free; (iv) not warp, crack, rust, 1127 discolor, or otherwise deteriorate over time in a manner that shall interfere with its 1128 intended use; (v) resist degradation from ultraviolet radiation; (vi) be incapable of 1129 penetration by biting or clawing of household pets (e.g., dogs and cats) or other wild and 1130 non-domesticated pests (e.g., raccoons and rats); (vii) remain impervious to any damage 1131 that would interfere with the Cart’s intended use after repeated contact with gravel, 1132 concrete, asphalt, or any other rough and abrasive surface on the bottoms of Cart bodies; 1133 and (viii) provide continuous maneuverability and mobility on all wheel and axle 1134 assemblies as originally designed and intended.
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Restated Service Agreement January 27, 2026 -30- City of Modesto/Bertolotti Modesto Disposal, Inc. 1135 3. Carts shall be resistant to: (i) common household or Residential products and chemicals; 1136 (ii) human and animal urine and feces; and (iii) airborne gases or particulate matter 1137 currently present in the ambient air of the Service Area. 1138 4. All Containers with a capacity of two (2) cubic yards or more shall meet applicable Federal 1139 regulations for Bin safety and be covered with attached lids. 1140 5. Contractor shall obtain the City’s written approval for Container materials, designs, 1141 colors, labeling, and other specifications before acquisition, painting, labeling, or 1142 distribution occurs.
1143 6. When purchasing plastic Collection Containers, Contractor shall purchase Containers that 1144 contain a minimum of thirty percent (30%) post-consumer Recycled plastic content, 1145 unless such requirement is waived by the City Contract Manager. 1146 7. Container lids shall be designed such that the following requirements are met:
1147 a. Prevents the intrusion of rainwater and vectors. 1148 b. Prevents the emissions of odors.
1149 c. Enables the free and complete flow of material from the Container during the dump 1150 cycle without interference with the material already deposited in the truck body, the 1151 truck body itself, and its lifting mechanism.
1152 d. Permits users of the Cart to conveniently and easily open and shut the lid throughout 1153 the serviceable life of the Cart.
1154 e. Hinged to the Cart body in such a manner so as to enable the lid to be fully opened, free 1155 of tension, to a position whereby it may rest against the backside of the Cart body. 1156 f. Prevents damage to the Container body, the lid itself, or any component parts through 1157 repeated opening and closing of the lid by Generators or in the dumping process. 1158 g. Remains closed in winds up to twenty-five (25) miles per hour from any direction. All lid 1159 hinges must remain fully functional and continually hold the lid in the original designed 1160 and intended positions when either opened or closed. 1161 h. Designed and constructed so that it prevents physical injury to the user while opening 1162 and closing the Cart.
1163 8. Containers shall be stable and self-balancing in the upright position, when either empty or 1164 loaded to their maximum design capacity with an evenly distributed load, with the lid in either 1165 a closed or an open position. Containers shall be capable of maintaining upright position in 1166 sustained or gusting winds of up to twenty-five (25) miles per hour from any direction. 1167 9. Containers shall be capable of being easily moved and maneuvered, if applicable, with an 1168 evenly distributed load equal in weight to its maximum design capacity on a level, sloped, or 1169 stepped surface.
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Restated Service Agreement January 27, 2026 -31- City of Modesto/Bertolotti Modesto Disposal, Inc. 1170 10. All such Containers shall be one hundred percent (100%) Recyclable at the end of their useful 1171 life.
1172 11. All Containers shall be designed and constructed to be watertight and prevent the leakage of 1173 liquids.
1174 12. All Bins shall be equipped with a secure locking mechanism, which may be utilized as needed 1175 to prevent unauthorized access.
1176 C. Container Colors. Contractor shall provide all Customers with Collection Containers that comply 1177 with the Container color requirements specified in this Section, or as otherwise specified in 14 CCR 1178 Section 18982; 14 CCR, Division 7, Chapter 12, Article 3; or other Applicable Law. Colors shall be 1179 colorfast and resistant to fading as a result of weathering or ultraviolet degradation; and the lids 1180 and bodies shall be uniform for each Container type, as follows:
1181 1. For a three (3)-Container system:
1182 a. Recyclable Materials Container bodies and lids shall be blue. 1183 b. Organic Materials Container bodies and lids shall be green. 1184 c. Garbage Container bodies and lids shall be black. 1185 Hardware such as hinges and wheels on the Containers may be a different color than specified 1186 above. All Containers shall comply with these color requirements, in accordance with Applicable 1187 Law.
1188 D. Container Labeling. All markings on the Containers shall be approved by the City in advance of 1189 ordering such Containers. On the lid of each Cart, and the body of each Bin and Roll-Off Box, 1190 Contractor shall label the materials as follows: “RECYCLE” for Recyclable Materials; “ORGANIC” for 1191 Organic Materials; and “GARBAGE” for landfill materials. On the body of each Cart, Bin, and Roll-Off 1192 Box, Contractor shall label the Container capacity (in gallons for Carts and in cubic yards for Bins and 1193 Roll-Off Boxes). Container body labeling shall be positioned on the side of each Container, so it is 1194 visible to the Customer at all times.
1195 As of the Commencement Date of the Agreement, all new Containers placed into service shall be 1196 labeled using City-provided labels.
1197 All new Carts shall include a high-quality educational information label using in-mold technology, 1198 such that all labeling shall be integral to the lid, through the use of injection molding, and shall not 1199 be affixed to any part of the Cart or lid through the use of adhesives. Notwithstanding the provisions 1200 of this Section, or the requirements of SB 1383, the in-mold lid label shall, at a minimum, include 1201 for each Container: (i) primary materials accepted; (ii) primary Prohibited Container Contaminants; 1202 (iii) a clear indication of Prohibited Container Contaminants for that Container type; (iv) acceptable 1203 materials; (v) Prohibited Container Contaminants; (vi) notification forbidding Hazardous Waste and 1204 describing proper Disposal thereof; (vii) notification forbidding scavenging (through words and 1205 international symbols) and describing the penalties therefore under California law or City 1206 Resolution; (viii) information about the Collection program; and (ix) the City’s name and logo. #6..
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Restated Service Agreement January 27, 2026 -32- City of Modesto/Bertolotti Modesto Disposal, Inc. 1207 E. Repair and Replacement of Containers. Contractor shall be responsible for acquiring and providing 1208 the replacement Containers. Contractor shall repair or replace all damaged or broken Containers 1209 on the scheduled Collection Day following Customer or City request, or when Contractor determines 1210 the Container is no longer suitable for service. Minor cracks, holes, and other damages to hinges, 1211 wheels, axles, hardware, and other component parts shall be readily repairable by Contractor 1212 personnel. All repairs must restore the Container to its full functionality to meet the design and 1213 performance requirements as set forth herein. Additionally, Contractor shall repair or replace all 1214 Containers damaged by Collection operations in accordance with standards specified in Subsection 1215 5.6.E. All Containers shall be maintained in a functional condition. If Contractor has a reason to 1216 believe that a Customer may be abusing the repair/replacement requirement of this Section, 1217 Contractor may present the basis for their belief to the City Contract Manager who may, in their 1218 sole discretion, modify the obligations of this Section with respect to such Customer. 1219 Single-Family Customers may also request one (1) Cart size exchange per Rate Period at no charge 1220 and Commercial Customers are entitled to one (1) Container replacement for no charge with a 1221 police report. All such Containers shall be provided within three (3) Working Days of City or 1222 Customer request. Contractor shall proactively monitor Contractor’s failure to comply with the 1223 Container requirements. If Contractor fails to comply with Container requirements, the City may 1224 assess Liquidated Damages pursuant to Section 10.5 and Exhibit F. 1225 F. Inventory. Contractor shall maintain a sufficient inventory of Containers to accommodate new 1226 Customer requests for service, requests for change in Service Levels (size, type, or number of 1227 Containers) from current Customers, and requests for replacement due to damage. Contractor shall 1228 ensure such inventory is sufficient for each type of service provided under this Agreement. 1229 Contractor shall ensure Container identification numbers are associated with Customer accounts 1230 upon delivery or exchange of Containers and shall inspect records quarterly to ensure accuracy in 1231 Contractor’s information systems and Customer service database. 1232 G. Maintenance, Cleaning, Painting. All Containers shall be maintained in a safe, serviceable, and 1233 functional condition and present a clean appearance. Contractor shall steam clean and repaint all 1234 Containers as needed (other than Carts) so as to present a clean appearance. Contractor shall offer 1235 steam cleaning service (or clean Container exchange) to Customers requesting such service (or 1236 Container exchange) at the approved Rate.
1237 Contractor shall proactively monitor Customer Containers and shall remove graffiti from 1238 Containers: (i) within forty-eight (48) hours of identification by Contractor or notice by the City or 1239 Customer if such graffiti includes any written or pictorial obscenities; or (ii) on Customer’s next 1240 Service Opportunity, not to exceed one (1) week of identification by Contractor or notice by the City 1241 or Customer if graffiti on Containers does not include any written or pictorial obscenities. This 1242 service shall not replace any Customer’s swap service that is allowed at no cost one (1) time per 1243 year.
1244 Upon request from the City Contract Manager, Contractor shall provide the City with a list of 1245 Containers and the date each Container was painted and maintained. 1246 H. City Ownership of Containers at End of Term. Upon expiration or early termination of Agreement, 1247 all Carts purchased and put into service at Customer Premises during the Term of the Agreement 1248 shall become property of the City at no cost to the City, if such Carts are fully depreciated. All Carts #6..
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Restated Service Agreement January 27, 2026 -33- City of Modesto/Bertolotti Modesto Disposal, Inc. 1249 purchased and put into service at Customer Premises during the Term of the Agreement that have 1250 not been fully depreciated shall remain the property of Contractor upon the date of this 1251 Agreement’s expiration or earlier termination. In such case, Contractor shall be responsible for 1252 outstanding depreciation and for removing all Carts in service from the Premises within fourteen 1253 (14) Working Days of the expiration date or early termination date of this Agreement, or within a 1254 different timeframe if mutually agreed to by the Parties. Contractor shall arrange for reuse or 1255 Recycling of Carts removed from the City.
1256 5.7 Personnel
1257 A. General. Contractor shall furnish such qualified personnel as may be necessary to provide the 1258 services required by this Agreement in a safe, respectful, and efficient manner. Contractor shall 1259 designate at least one (1) qualified employee as the City’s primary point of contact with Contractor 1260 who is principally responsible for Collection operations and resolution of service requests and 1261 Complaints. Such individual shall be empowered to negotiate on behalf of and bind Contractor with 1262 respect to any changes in scope, dispute resolution, compensation adjustments, and service-related 1263 matters that may arise during the Term of this Agreement. 1264 Contractor shall use its best efforts to ensure that all employees present a neat appearance and 1265 conduct themselves in a courteous manner. Contractor shall not permit its employees to accept, 1266 demand, or solicit, directly or indirectly, any additional compensation, or gratuity from Customers 1267 or members of the public.
1268 B. Driver Qualifications. All drivers must have in effect a valid license, of the appropriate class, issued 1269 by the California Department of Motor Vehicles. Contractor shall use the Class II California 1270 Department of Motor Vehicles employer “Pull Notice Program” to monitor its drivers for safety. 1271 C. Safety Training. Contractor shall provide suitable operational and safety training for all of its 1272 employees who operate Collection vehicles or equipment. Contractor shall train its employees 1273 involved in Collection to identify, and not to Collect, Excluded Waste. Upon the City Contract 1274 Manager’s request, Contractor shall provide a copy of its safety policy and safety training program, 1275 the name of its safety officer, and the frequency of its trainings. 1276 D. Designated Staff.
1277 1. Contractor’s Contract Manager. Contractor shall designate in writing a "Contract Manager" 1278 who shall be responsible for working with the City and/or the City's designated 1279 representative(s) to resolve Contract-related issues. Contractor must respond to all inquiries 1280 from the City within two (2) Working Days from the time of the inquiry. The City shall be 1281 notified in advance of any change in Contract Manager. 1282 2. Field Supervisor. Contractor shall designate at a minimum one (1) qualified employee as 1283 supervisor of field operations. The designated Field Supervisor will devote time in the field, 1284 checking on Collection operations, including responding to Customer requests, inquiries, and 1285 Complaints.
1286 E. Key Personnel. Contractor shall notify the City of any changes in Contractor’s key staff to be 1287 assigned to perform the services required under this Agreement, prior to any such performance. #6..
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Restated Service Agreement January 27, 2026 -34- City of Modesto/Bertolotti Modesto Disposal, Inc. 1288 Contractor shall designate a secondary point of contact for all key staff members for instances 1289 where key staff member assigned to perform the services is unavailable. 1290 Notwithstanding the City’s approval of Contractor’s personnel, Contractor shall not be relieved from 1291 any liability resulting from the work to be performed under this Agreement, nor shall Contractor be 1292 relieved from its obligation to ensure that its personnel maintain all requisite certifications, licenses, 1293 and the like, and Contractor shall ensure that its personnel fully comply with Applicable Law at all 1294 times.
1295 F. Anti-Discrimination and Anti-Harassment. Contractor’s employees shall at all times comply with 1296 the anti-discrimination and anti-harassment standards required by Exhibit K. 1297 5.8 Hazardous and Excluded Waste Inspection and Handling 1298 A. Inspection Program and Training. Contractor shall develop a load inspection program that includes 1299 the following components: (i) personnel and training; (ii) load checking activities; (iii) management 1300 of wastes; and (iv) recordkeeping and emergency procedures. 1301 Contractor’s load checking personnel, including its Collection vehicle drivers, shall be trained in: (i) 1302 the effects of Hazardous Substances on human health and the environment; (ii) identification of 1303 Prohibited Container Contaminants; and (iii) emergency notification and response procedures. 1304 Collection vehicle drivers shall inspect Containers before Collection when practical. 1305 B. Response to Excluded Waste Identified During Collection. If Contractor determines that material 1306 placed in any Container for Collection is Excluded Waste or presents a hazard to Contractor's 1307 employees, Contractor shall have the right to refuse to accept such material. The Generator shall 1308 be contacted by Contractor and requested to arrange for proper Disposal. If the Generator cannot 1309 be reached immediately, Contractor shall, before leaving the Premises, leave a non-Collection 1310 notice, which indicates the reason for refusing to Collect the material and lists the phone number 1311 of a facility that accepts the Excluded Waste or a phone number of an entity that can provide 1312 information on proper Disposal of the Excluded Waste. Under no circumstances shall Contractor’s 1313 employees knowingly Collect Excluded Waste or remove unsafe or poorly containerized Excluded 1314 Waste from a Collection Container.
1315 If Excluded Waste is found in a Collection Container or Collection area that could possibly result in 1316 imminent danger to people or property, Contractor shall immediately notify the Fire Department 1317 and the City Contract Manager.
1318 C. Response to Excluded Waste Identified At Processing or Disposal Facility. Materials Collected by 1319 Contractor will be delivered to the Approved Facilities for purposes of Processing or Disposal. In the 1320 event that load checkers and/or equipment operators at such Approved Facilities identify Excluded 1321 Waste in the loads delivered by Contractor, such personnel shall remove these materials for storage 1322 in approved, onsite, Excluded Waste storage Container(s). Contractor shall, at its cost, arrange for 1323 removal of the Excluded Wastes by permitted haulers in accordance with Applicable Laws and 1324 regulatory requirements. Contractor may, at its sole expense, attempt to identify and recover the 1325 cost of Disposal from the Generator. If the Generator can be successfully identified, the cost of this 1326 effort, as well as the cost of Disposal, shall be chargeable to the Generator. #6..
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Restated Service Agreement January 27, 2026 -35- City of Modesto/Bertolotti Modesto Disposal, Inc. 1327 5.9 Contract Management
1328 City has designated staff, the City Contract Manager, to be responsible for the monitoring and 1329 administration of this Agreement. Contractor shall designate an employee to serve as Contractor’s 1330 Contract Manager, who shall be responsible for working closely with the City Contract Manager in the 1331 monitoring and administration of this Agreement.
1332 Contractor’s Contract Manager shall meet and confer with the City Contract Manager to resolve 1333 differences of interpretation and implement and execute the requirements of this Agreement in an 1334 efficient and effective manner that is consistent with the stated objectives of this Agreement. 1335 The City Contract Manager and Contractor’s Contract Manager shall hold contract management meetings 1336 monthly, or at another frequency designated by the City Contract Manager. This meeting is intended to 1337 review the status of Contractor’s implementation of programs and services required under this 1338 Agreement, coordinate shared efforts between the Parties, and perform other agenda items as deemed 1339 appropriate by the Parties for such meetings.
1340 From time to time, the City Contract Manager may designate other agents of the City to work with 1341 Contractor on specific matters. In such cases, those individuals should be considered designates of the 1342 City Contract Manager for the matters in which they have been engaged. Such designates shall be afforded 1343 all of the rights and access granted thereto. In the event of a dispute between the City Contract Manager’s 1344 designate and Contractor, the City Contract Manager’s determination shall be conclusive. 1345 In the event of dispute between the City Contract Manager and Contractor regarding the interpretation 1346 or performance of services under this Agreement, the City Contract Manager’s determination shall be 1347 conclusive, except where such determination results in a material impact to Contractor’s revenue and/or 1348 cost of operations, during which the provisions of Section 10.8 shall apply. For the purposes of this Section, 1349 “material impact” is an amount equal to or greater than one percent (1%) of Contractor’s annual Gross 1350 Receipts under this Agreement.
1351 City Contract Manager or their designate shall have the right to observe and review Contractor operations 1352 and Facilities, which may include entering Premises and reviewing Contractor’s records, during 1353 Contractor’s office hours with three (3) Days’ notice. In no event shall Contractor prevent access to such 1354 Premises for a period of more than three (3) Days after receiving such a request. 1355 5.10 Local Purchasing Preference
1356 Contractor shall, throughout the Term of this Agreement, use best efforts to give preference to purchasing 1357 materials and supplies used in connection with Agreement from local vendors within the City, County, or 1358 State, in that order of preference. At a minimum, Contractor shall purchase the following items from 1359 vendors within the City or County: (i) vehicle supplies (e.g., fuel, fluids, tires, parts); (ii) printing and 1360 publishing services for any and all public education and outreach materials; (iii) uniforms, safety 1361 clothing/equipment, and work boots; and (iv) office supplies. Contractor shall submit an annual report to 1362 the City identifying their compliance with this Section. 1363 5.11 Diversion Requirements
1364 A. General. Contractor shall perform services under this Agreement in a manner that supports the 1365 City’s sustainability goals. Contractor is expected, during each and every one of its interactions with #6..
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Restated Service Agreement January 27, 2026 -36- City of Modesto/Bertolotti Modesto Disposal, Inc. 1366 Customers, to suggest opportunities for Customers to reduce their Garbage subscription levels and 1367 increase their Recyclable Materials and Organic Materials subscription levels. Contractor shall 1368 support the City in maintaining at least fifty percent (50%) Diversion, as required per State law 1369 (AB 939).
1370 B. Program Effectiveness. Additionally, if the City Contract Manager or Contractor notice a measurable 1371 decline in participation or the effectiveness of Diversion program(s), the City Contract Manager and 1372 Contractor’s Contract Manager must meet and confer to determine how to improve messaging 1373 and/or service(s).
1374 All programs with City oversight shall have their costs itemized. The City reserves the right to 1375 eliminate any program that is ineffective in meeting the intended goals of the programs. Those 1376 funds may then be directed to new or other programs at the discretion of the City Contract 1377 Manager. On an annual basis, as required in Exhibit D, Contractor shall provide a narrative for 1378 improving any and all programs that are either underperforming or where program results have 1379 become stagnant.
1380 Failure to meet the requirements of this Section may result in Liquidated Damages in accordance 1381 with Section 10.5.
1382 ARTICLE 6.
1383 RECORDKEEPING AND REPORTING
1384 6.1 Recordkeeping
1385 Contractor shall maintain Customer contact information, Customer service, accounting, statistical, 1386 operational, and programmatic data, as well as other records and associated documentation, related to 1387 its performance under this Agreement and as shall be necessary to provide detailed and accurate reports, 1388 and demonstrate compliance with this Agreement and Applicable Law. Unless otherwise stated in this 1389 Article, Contractor shall retain all data and records required to be maintained by this Agreement for the 1390 Term of this Agreement, plus five (5) years after its expiration or earlier termination, unless the City agrees 1391 in writing to an earlier disposition. Data and records shall be in a chronological and organized form that is 1392 readily and easily interpreted to facilitate the flexible use of data in reports. Contractor’s records shall be 1393 stored in one (1) central location, physical or electronic, that can be readily accessed by Contractor. 1394 Contractor agrees that all data covered by this Agreement regarding business operations, Customer lists, 1395 routing, Tonnage, Service Levels, work orders issued from dispatch, Customer service logs and account 1396 notes, and work force and bargaining agreements, do not constitute Proprietary Information or Trade 1397 Secrets and shall be made available to the City Contract Manager or their designee upon request and 1398 within the timelines required by this Article.
1399 Upon City Contract Manager’s request, any such records shall be retrieved in a timely manner, not to 1400 exceed five (5) Working Days, and made available to the City Contract Manager, including any record or 1401 documentation that City, in their sole discretion, may deem necessary, for the City to fulfill obligations 1402 under Applicable Law, including, but not limited to, AB 939, AB 341, AB 1826, AB 876, AB 901, SB 1383, 1403 and other current or future Federal, State, or local regulations, as amended. #6..
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Restated Service Agreement January 27, 2026 -37- City of Modesto/Bertolotti Modesto Disposal, Inc. 1404 Contractor shall maintain adequate record security to preserve records from events that can be 1405 reasonably anticipated, such as a fire, theft, and earthquake. Electronically maintained data and records 1406 shall be protected and backed up. To the extent that Contractor utilizes its computer systems to comply 1407 with recordkeeping and reporting requirements under this Agreement, Contractor shall, on a monthly 1408 basis, save all system-generated reports supporting those recordkeeping and reporting requirements in a 1409 static format in order to provide an audit trail, as requested, for all data required under this Agreement. 1410 City views its ability to defend itself against Comprehensive Environmental Response, Compensation and 1411 Liability Act (CERCLA), and related litigation as a matter of great importance. For this reason, the City 1412 regards its ability to prove where Collected Recyclable Materials, Organic Materials, and Garbage are 1413 taken for Transfer, Processing, or Disposal. Contractor shall maintain records that can establish where 1414 Recyclable Materials, Organic Materials, and Garbage Collected were Transferred, Processed, or Disposed. 1415 This provision shall survive the expiration or earlier termination of this Agreement. Contractor shall 1416 maintain these records for a minimum of ten (10) years beyond expiration or earlier termination of the 1417 Agreement. Contractor shall provide these records to the City (within fifteen (15) Days upon request, or 1418 as otherwise agreed upon) in an organized and indexed manner rather than destroying or Disposing of 1419 them.
1420 6.2 Report Submittal Requirements
1421 Contractor shall submit monthly reports, in a City-provided template, within thirty (30) Days after the end 1422 of the calendar month and annual reports no later than sixty (60) Days after the end of each calendar 1423 year. Monthly and annual reports shall include at a minimum, all data and information described in Exhibit 1424 D, unless otherwise specified under this Agreement. 1425 The format of each report shall be approved by the City Contract Manager, in their sole discretion. The 1426 City Contract Manager may, from time to time during the Term, review and request changes to 1427 Contractor’s report formats and content, which includes, but is not limited to, any information that the 1428 City must report to a local or State agency. Contractor shall not unreasonably deny such requests. 1429 Contractor shall submit all reports to the City Contract Manager via email. Contractor may request, no 1430 more than two (2) times during any rolling twelve (12) month period, an extension of the report submittal 1431 date by submitting such request to the City in advance of the applicable submittal deadline, and the City 1432 shall approve such request.
1433 City reserves the right to require Contractor to provide additional reports or documents, as the City 1434 Contract Manager determines to be required for the administration of this Agreement or in compliance 1435 with Applicable Law.
1436 6.3 Performance Review and Audit
1437 The City may conduct, and Contractor shall cooperate with, four (4) performance reviews that include 1438 detailed financial audits, at any point during the Term of this Agreement in the City Contract Manager’s 1439 sole discretion, to verify Contractor has fulfilled its operational obligations under this Agreement. The 1440 purpose of such reviews and audits shall be, without limitation, to review Complaints, billings, and City 1441 Reimbursements, and determine if Contractor has met the performance standards described in this 1442 Agreement (including, without limitation, direct services provided to Customers as described in Exhibit B, 1443 recordkeeping and reporting as required in Exhibit D, and performance standards established in Exhibit 1444 F). The City may choose to enlist professional service providers to perform such reviews and audits, and #6..
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Restated Service Agreement January 27, 2026 -38- City of Modesto/Bertolotti Modesto Disposal, Inc. 1445 Contractor shall be required to pay the City’s actual costs for such services, up to forty-two thousand five 1446 hundred dollars ($42,500) per occurrence (such amount shall be adjusted annually by the annual 1447 percentage change in CPI-U, calculated in accordance with Exhibit E). Contractor may not influence or 1448 Control the City’s selection of professional service providers, nor the specific review items covered by the 1449 review. Contractor shall cooperate with the City and its agents during the review and audit process. If any 1450 noncompliance with the Agreement is found, the City may direct Contractor to correct the inadequacies 1451 in accordance with Article 10 of this Agreement.
1452 At the City’s sole option, with at least thirty (30) Days’ written notification to Contractor, it may conduct 1453 a public hearing, at which Contractor shall be present and shall participate, to review Contractor's 1454 performance and quality of service, and evaluate technological and regulatory changes. The reports 1455 required by Exhibit D to this Agreement regarding Customer Complaints may be utilized as a basis for 1456 review, as well as any findings from performance reviews and/or audits. Performance and service quality 1457 review hearings may be scheduled by the City at its discretion throughout the Term of the Agreement. 1458 ARTICLE 7.
1459 CITY REIMBURSEMENT
1460 7.1 Franchise Fee
1461 In consideration of the rights provided Contractor herein, Contractor shall pay Franchise Fees to City equal 1462 to ten and three tenths percent (10.3%) of Gross Receipts for all services performed under this Agreement 1463 less the dollar amount of the fees paid under Section 7.2, 7.3, and 7.4 below. This fee may be adjusted by 1464 resolution of the City Council. The frequency at which Franchise Fees shall be paid is up to the discretion 1465 of the City Contract Manager.
1466 7.2 AB 939/SB 1383 Reimbursement
1467 Contractor shall pay an AB 939/SB 1383 Reimbursement to the City each quarter. The amount of the AB 1468 939/SB 1383 Reimbursement shall be one dollar and ninety cents ($1.90) per Customer per month in Rate 1469 Period One, paid in quarterly installments based on the active Customers billed during the preceding 1470 quarter. The City shall use the AB 939/SB 1383 Reimbursement to refund expenses, including, but not 1471 limited to, staffing costs related to City programs, including the City’s green waste diversion program, pilot 1472 studies, education and outreach campaigns, technical assistance to Customers, reporting, compliance, 1473 capacity planning, provision of special Containers, and other activities involved in compliance with AB 939 1474 and/or SB 1383. The City shall retain the sole right to set priorities for the use of its AB 939/SB 1383 1475 Reimbursement. This reimbursement shall be a pass-through cost. 1476 7.3 Public Education Reimbursement
1477 Contractor shall pay a Public Education Reimbursement to the City annually, by July 31st, commencing in 1478 Rate Period One. The amount of the Public Education Reimbursement shall equal fifty-one thousand 1479 dollars ($51,000), per year in Rate Period One. This fee is to reimburse the City for the cost of providing 1480 public outreach and educational programs. Such amount shall be adjusted annually by the annual 1481 percentage change in CPI-U, calculated in accordance with Exhibit E.

Commented [SP3]: Note: City to confirm SB1383 fees are
listed accurately.

Commented [JS4R4]: HF&H to complete final update to
capture all current City fees. Information has been provided. #6..
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Restated Service Agreement January 27, 2026 -39- City of Modesto/Bertolotti Modesto Disposal, Inc. 1482 7.4 Waste Generation and Characterization Reimbursement 1483 Contractor shall pay a Waste Generation and Characterization Reimbursement up to once annually 1484 throughout the Term. The amount of the Waste Generation and Characterization Reimbursement shall 1485 be thirty-four thousand dollars ($34,000) per occurrence. This reimbursement shall be remitted to the 1486 City within sixty (60) Days of the City’s request for reimbursement, but in no instance more than once 1487 annually throughout the Term.
1488 7.5 Adjustment to Reimbursement
1489 City may set other fees or adjust the fees established in this Article from time to time during the Term of 1490 this Agreement and such adjustments shall be included in the adjustment of Rates described in Exhibit E. 1491 The amounts of the Franchise Fee, AB 939/SB 1383 Reimbursement, Public Education Reimbursement, 1492 and Waste Generation and Characterization Reimbursement for subsequent Rate Periods shall be 1493 adjusted annually by the same Annual Percentage Change in the CPI-U, calculated in accordance with the 1494 adjustment method described in Exhibit E.
1495 7.6 Payment Schedule and Late Fees
1496 Within thirty (30) Days of the end of each calendar month, during the Term of this Agreement, Contractor 1497 shall remit to the City all reimbursements as described in this Article and all tipping fees associated with 1498 use of the Approved Organic Materials Processing Facility, with the exceptions of the Public Education 1499 Reimbursement and Waste Generation and Characterization Reimbursement. Such reimbursements shall 1500 be remitted to the City and sent or delivered to the City Contract Manager. If such remittance is not paid 1501 to the City on or before the thirtieth (30th) calendar Day following the end of a calendar month or first 1502 Working Day following a weekend or Holiday, all fees due shall be subject to a delinquency penalty of one 1503 and one half percent (1.5%), which attaches on the first Day of delinquency. The delinquency penalty shall 1504 be increased an additional one and one-half percent (1.5%) for each additional month the payment 1505 remains delinquent.
1506 Each monthly remittance to the City shall be accompanied by a statement listing: (i) the amount of each 1507 reimbursement paid; (ii) calculation of each reimbursement; and (iii) Gross Receipts that separately 1508 identify AB 939/SB 1383 Reimbursement eligible revenues collected from all operations conducted or 1509 permitted by this Agreement, by Customer Type, for the period. The City Contract Manager may, at any 1510 time during the Term, request a detailed calculation of Gross Receipts that may include, but is not 1511 necessarily limited to, the number of Customers charged at each Service Level and Rate for each billing 1512 period. Contractor shall maintain all supporting documents and calculations for each payment made to 1513 the City as required by Section 6.1.
1514 City Contract Manager may, at any time during the Term, perform an audit of Contractor’s billings and 1515 payment of reimbursements. Contractor shall cooperate with the City Contract Manager in any such audit. 1516 Should the City or its agent perform this review and identify billing errors or other errors in payment of 1517 fees valued at one percent (1%) or more of Gross Receipts for the period reviewed, Contractor shall, in 1518 addition to compensating the City for lost fees, reimburse the City’s actual cost of the review.

Commented [JS5]: HF&H to add in missing fees. Information has been provided.

Commented [JS6]: Pending final review after HF&H fee
update.
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Restated Service Agreement January 27, 2026 -40- City of Modesto/Bertolotti Modesto Disposal, Inc. 1519 ARTICLE 8.
1520 CONTRACTOR'S COMPENSATION AND RATE
1521 SETTING
1522 8.1 General
1523 Contractor’s Compensation for performance of all its obligations under this Agreement shall be Gross 1524 Receipts. Contractor’s Compensation provided for in this Article shall be the full, entire, and complete 1525 compensation due to Contractor pursuant to this Agreement for all labor, equipment, materials and 1526 supplies; Transfer, Processing, and Disposal fees; City Reimbursements; taxes; insurance; bonds; 1527 overhead; operations; profit; and all other things necessary to perform all the services required by this 1528 Agreement in the manner and at the times prescribed. Nothing herein shall obligate City to provide any 1529 compensation to Contractor beyond Gross Receipts.
1530 If Contractor’s actual costs, including City Reimbursements, are more than Gross Receipts, Contractor shall 1531 not be compensated for the difference in actual costs and actual Gross Receipts. If Contractor’s actual 1532 costs are less than the actual Gross Receipts, Contractor shall retain the difference, provided that 1533 Contractor has paid City Reimbursements pursuant to Article 7. 1534 Contractor’s proposed costs and operating assumptions for Rate Period One are presented in Exhibit G2. 1535 Contractor shall be responsible for providing applicable invoices to the City in a timely and accurate 1536 manner.
1537 8.2 Rates and Annual Adjustments
1538 A. General. The City Council shall be responsible for approving Rates as described in this Article. If at 1539 any time during the Term of the Agreement, Contractor determines the need for a Rate that does 1540 not appear on the City-approved Rate schedule in Exhibit G2, Contractor shall immediately notify 1541 the City and request establishment of such Rate. For example, if a Customer requires Collection of 1542 Organic Materials in a fifteen (15) cubic yard Compactor five (5) times per week and the City1543 approved Rate schedule does not include this Service Level, Contractor must request that the City 1544 approve a Rate for this Service Level.
1545 B. Rates for Rate Period One. Rates for Rate Period One, which are presented in Exhibit G2, were 1546 determined by Contractor and the City and approved along with the Agreement. The Rates for Rate 1547 Period One shall be effective from May 1, 2026 through June 30, 2027. 1548 C. Rates for Subsequent Rate Periods. Rates for subsequent Rate Periods shall be adjusted annually 1549 in accordance with this Section 8.2 and Exhibit E, pending City Council approval of Rates. City Council 1550 shall not unreasonably withhold Rate adjustments calculated in accordance with this Agreement. 1551 The index-based adjustment, which is described in Exhibit E1, involves use of various cost 1552 adjustment factors (such as the percentage change in the Consumer Price Index and changes in 1553 Tonnage and tipping fees) to calculate adjusted Rates. Such Rate adjustment calculations shall be 1554 performed in strict conformance to the procedures described in Exhibit E1. 1555 In Rate Periods Three (3), Seven (7), and/or upon any extension of this Agreement pursuant to 1556 Section 2.2, including Rate Period Ten (10), Rates shall be adjusted using the cost-based Commented [SP7]: Note: Update date upon confirming
commencement date.
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Restated Service Agreement January 27, 2026 -41- City of Modesto/Bertolotti Modesto Disposal, Inc. 1557 methodology described in Exhibit E2 that involves a review of Contractor’s actual costs and 1558 revenues and projection of costs and revenues for the coming Rate Period. This cost-based Rate 1559 adjustment will be performed instead of the index-based Rate adjustment for that Rate Period. The 1560 cost-based adjustment process is intended to provide the City with an opportunity to adjust Rates 1561 to more accurately reflect actual revenues and costs of operations. Such Rate adjustment 1562 calculations shall be performed in strict conformance to the procedures described in Exhibit E2. 1563 D. Rate Structure. The City may, at any time during the Term of this Agreement and in its sole 1564 discretion, change the relationship of individual Rates in comparison with other Rates. Any such 1565 changes would occur in conjunction with the annual Rate adjustment process described in 1566 Section 8.2 or in conjunction with a Rate adjustment resulting from an extraordinary Rate 1567 adjustment in accordance with Section 8.3. Changes to the Rates charged under the new structure 1568 shall be calculated in such a way that the revised Rate structure generates at least the same amount 1569 of total revenue when the current number of accounts at each Service Level are multiplied by the 1570 Rates charged for each Service Level and the total for all Service Levels are summed. 1571 8.3 Extraordinary Rate Adjustments
1572 It is understood that Contractor accepts the risk for changes in the cost of providing services at the Service 1573 Levels requested by Customers and, therefore, the extraordinary adjustments to Rates shall be limited to 1574 a Change in Law or a City-directed change in scope. If a Change in Law or City-directed change in scope 1575 (pursuant to Section 3.5) occurs, Contractor may petition the City for an adjustment to the Rates in excess 1576 of the annual adjustment described in Section 8.2. 1577 Contractor shall prepare an application for the extraordinary Rate increase. Such submittal shall be 1578 prepared in compliance with the procedures described in Exhibit E2, and shall provide all information 1579 requested by the City Contract Manager specific to the nature of the request being made. Contractor shall 1580 pay all costs incurred by the City, including the costs of outside accountants, attorneys, and/or 1581 consultants, that are necessary for the City to evaluate and verify accuracy and justification of the 1582 requested Rate adjustment. The application shall clearly document the reason for the proposed 1583 adjustment, include calculation of the proposed Rate adjustments, and provide supporting 1584 documentation.
1585 In the event of such an application for an extraordinary Rate increase, it is understood that Contractor 1586 shall have the burden of demonstrating, to the reasonable satisfaction of the City Contract Manager, that 1587 the failure of the City to adjust the Rates will result in Contractor’s financial loss or failure to achieve 1588 reasonable profitability, due to the Change in Law or City-directed change in scope. Contractor will have 1589 to demonstrate financial loss or a failure to achieve reasonable profitability by allowing for the review of 1590 financial statements and supporting documentation by the City Contract Manager. 1591 The City Contract Manager shall have the right to request any other information that they, in their sole 1592 judgment, determine is necessary to establish the reasonableness or accuracy of Contractor’s request for 1593 an extraordinary Rate increase. Contractor’s failure to fully cooperate in a timely manner, not to exceed 1594 five (5) Business Days, with any reasonable request for information by the City Contract Manager may 1595 result in either the denial of or a delay in the approval of the request for an extraordinary Rate increase. 1596 All Extraordinary Rate Increase requests shall be subject to City Council approval or denial prior to 1597 implementation of Rates.
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Restated Service Agreement January 27, 2026 -42- City of Modesto/Bertolotti Modesto Disposal, Inc. 1598 ARTICLE 9.
1599 INDEMNITY, INSURANCE, AND PERFORMANCE
1600 BOND
1601 9.1 Indemnification
1602 A. General. Contractor shall indemnify, defend with counsel acceptable to the City, and hold harmless 1603 (to the full extent permitted by law) the City and its officers, officials, employees, volunteers, and 1604 agents from and against any and all claims, liability, loss, injuries, damage, expenses, and costs 1605 (including, without limitation, costs and fees of litigation, including attorneys’ and expert witness 1606 fees) (collectively, “Damages”) of every nature arising out of or in connection with Contractor’s 1607 performance under this Agreement, or its failure to comply with any of its obligations contained in 1608 the Agreement, except to the extent such loss or damage was caused by the gross negligence or 1609 willful misconduct of the City. The terms of this indemnity will survive the termination or completion 1610 of this Agreement.
1611 B. Excluded Waste. Contractor acknowledges that it is responsible for compliance during the entire 1612 Term of this Agreement with all Applicable Laws. Contractor shall not store, Transport, use, or 1613 Dispose of any Excluded Waste, except in strict compliance with all Applicable Laws. 1614 In the event that Contractor negligently or willfully mishandles Excluded Waste in the course of 1615 carrying out its activities under this Agreement, Contractor shall, at its sole expense, promptly take 1616 all investigatory and/or remedial action reasonably required for the remediation of such 1617 environmental contamination. Prior to undertaking any investigatory or remedial action, however, 1618 Contractor shall first obtain the City’s approval of any proposed investigatory or remedial action. 1619 Should Contractor fail at any time to promptly take such action, the City may undertake such action 1620 at Contractor’s sole cost and expense, and Contractor shall reimburse City for all such expenses 1621 within thirty (30) Days of being billed for those expenses, and any amount not paid within that thirty 1622 (30) Day period shall thereafter be deemed delinquent and subject to the delinquent fee payment 1623 provision of Section 7.6. These obligations are in addition to any defense and indemnity obligations 1624 that Contractor may have under this Agreement. The provisions of this Section shall survive the 1625 termination or expiration of this Agreement.
1626 Notwithstanding the foregoing, Contractor’s duties under this Section shall not extend to any claims 1627 arising from the Disposal of Garbage at the Approved Disposal Facility, including, but not limited to, 1628 claims arising under Comprehensive Environmental Response, Compensation and Liability Act 1629 (CERCLA) unless such claim is a direct result of Contractor’s negligence or willful misconduct. 1630 C. Environmental Indemnity. Without limiting Contractor’s obligations under Subsection 9.1.A, 1631 Contractor shall defend, indemnify, and hold the City harmless against and from any and all claims, 1632 suits, losses, penalties, damages, and liability for damages of every name, kind, and description, 1633 including attorneys’ fees and costs incurred, arising out of, or in connection with Contractor’s 1634 handling of Excluded Waste. The terms of this indemnity will survive the termination or completion 1635 of this Agreement.
1636 D. Electronic and Web-Based Information Indemnity. Without limiting Contractor’s obligations under 1637 Subsection 9.1.A, Contractor shall defend, indemnify, and hold the City harmless against and from 1638 any and all claims, suits, losses, penalties, damages, and liability for damages of every name, kind, #6..
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Restated Service Agreement January 27, 2026 -43- City of Modesto/Bertolotti Modesto Disposal, Inc. 1639 and description, including attorneys’ fees and costs incurred, arising out of, or in connection with 1640 Contractor’s handling of Customer information, over which Contractor has Control, including, but 1641 not limited to, billing details, electronic payment(s), and Customer account information that is not 1642 readily available to the general public. Contractor shall maintain electronic files and Contractor’s 1643 website in accordance with the industry’s best practices for maintaining such information as safely 1644 and securely as possible.
1645 E. Related to AB 939, AB 341, AB 1826, and SB 1383. Contractor’s duty to defend and indemnify herein 1646 includes all fines and/or penalties imposed by CalRecycle, if the requirements of AB 939, AB 341, 1647 AB 1826, and/or SB 1383 are not met by Contractor, with respect to the waste stream Collected 1648 under this Agreement, and such failure is: (i) due to the failure of Contractor to meet its obligations 1649 under this Agreement; or (ii) due to Contractor delays in providing information that prevents 1650 Contractor or the City from submitting reports to regulators in a timely manner. 1651 F. Related to Change in Law Should there be a Change in Law or a new judicial interpretation of 1652 Applicable Law, including, but not limited to, Article XIII C and D of the California Constitution 1653 (commonly, Proposition 218), which impacts the Rates for the Collection services established in 1654 accordance with this Agreement, Contractor agrees to meet and confer with City to discuss the 1655 impact of such Change in Law on either Party’s ability to perform under this Agreement. 1656 If, at any time, a Rate adjustment, determined to be appropriate by both City and Contractor to 1657 compensate Contractor for increases in costs, as described in this Agreement, cannot be 1658 implemented for any reason, Contractor shall be granted the option to negotiate with the City, in 1659 good faith, a reduction of services equal to the value of the Rate adjustment that cannot be 1660 implemented. If the City and Contractor are unable to reach agreement about such a reduction in 1661 services, then Contractor may terminate this Agreement upon one (1) year’s prior written notice to 1662 the City, in which case Contractor and the City shall each be entitled to a payment of amounts due 1663 for contract performance through the date of termination, but otherwise will have no further 1664 obligation to one another, unless this Agreement specifically states otherwise, after the date of such 1665 termination. Should a court of competent jurisdiction determine that Contractor cannot charge 1666 and/or increase its Rates for charges related to governmental fees and charges, Contractor shall 1667 reduce the Rates it charges Customers a corresponding amount, providing said fees, Rates, and/or 1668 charges disallowed by the court are not related to the cost of providing service hereunder and had 1669 been incorporated in the Rates charged by Contractor to its Customers. 1670 G. Proposition 218 Release. The City intends to comply with all Applicable Law concerning the Rates 1671 provided under this Agreement. Upon thorough analysis, the Parties have made a good faith 1672 determination that the Rates provided under this Agreement are not subject to Article XIII C and D 1673 of the California Constitution (commonly, Proposition 218) because, among other reasons, such 1674 services are provided by a private contractor and not by the City, Contractor independently 1675 establishes the Rates for services within the limits established in this Agreement, the receipt of 1676 services is voluntary and not required of any property within the City, and any Owner of property 1677 or Customer within the City has the opportunity to avoid the services available under this 1678 Agreement either through Self-Hauling or use of their property in such a manner that Solid Waste 1679 is not generated. Accordingly, in the event that a third party challenges the Rates as being in 1680 violation of Article XIII C and D of the California Constitution, or otherwise asserts that the Rates are 1681 an invalid tax, assessment, or fee, Contractor agrees to waive, release, and hold harmless the City 1682 from and against any and all claims Contractor may have against the City resulting therefrom, and #6..
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Restated Service Agreement January 27, 2026 -44- City of Modesto/Bertolotti Modesto Disposal, Inc. 1683 to indemnify and defend the City, with legal counsel reasonably acceptable to the City, from any 1684 third-party claim, suit, or other action, whether administrative, legal, or equitable, challenging the 1685 Rates authorized under this Agreement as being in violation of Article XIII C and D of the California 1686 Constitution, or otherwise asserting that the Rates are an invalid tax, assessment, or fee, except to 1687 the extent that such third-party claim, suit, or other action challenges any City-imposed fee that is 1688 included in the maximum service Rates. This Section will survive the expiration or termination of 1689 this Agreement for claims arising prior to the expiration or termination of this Agreement. 1690 H. CalPERS Eligibility Indemnification. Contractor’s employees, agents, or Subcontractors providing 1691 service under this Agreement shall not: (i) qualify for any compensation and benefit under CalPERS; 1692 (ii) be entitled to any benefits under CalPERS; (iii) enroll in CalPERS as an employee of the City; (iv) 1693 receive any employer contributions paid by the City for CalPERS benefits; or (v) be entitled to any 1694 other CalPERS-related benefit that would accrue to a City employee. Contractor’s employees, 1695 agents, or Subcontractors hereby waive any claims to benefits or compensation described in this 1696 Section. This Section applies to Contractor notwithstanding any other agency, State, or Federal 1697 policy, rule, regulation, law, or ordinance to the contrary. 1698 If Contractor’s employees, agents, or Subcontractors providing services under this Agreement claim, 1699 or are determined by a court of competent jurisdiction or the California Public Employees 1700 Retirement System (CalPERS) to be eligible for enrollment in CalPERS of the City, Contractor shall 1701 indemnify, defend, and hold harmless the City for the payment of any employer and employee 1702 contributions for CalPERS benefits on behalf of the employee, as well as for payment of any 1703 penalties and interest on such contributions that would otherwise be the responsibility of the City. 1704 Contractor’s Compensation under this Agreement shall be the full and complete compensation to 1705 which Contractor and Contractor’s officers, employees, agents, and Subcontractors are entitled for 1706 performance of any work under this Agreement. Neither Contractor nor Contractor’s officers, 1707 employees, agents, and Subcontractors are entitled to any salary or wages, or retirement, health, 1708 leave, or other fringe benefits applicable to City employees. The City will not make any Federal or 1709 State tax withholdings on behalf of Contractor. The City shall not be required to pay any workers’ 1710 compensation insurance on behalf of Contractor.
1711 Contractor agrees to defend and indemnify the City for any obligation, claim, suit, or demand for 1712 tax; retirement contribution, including any contribution to CalPERS; social security; salary or wages; 1713 overtime payment; or workers’ compensation payment that the City may be required to make on 1714 behalf of: (i) Contractor, (ii) any employee of Contractor, or (iii) any employee of Contractor 1715 construed to be an employee of the City, for work performed under this Agreement. 1716 9.2 Insurance
1717 A. General Requirements. Contractor shall procure and maintain, for the duration of the Agreement, 1718 insurance against claims for injuries to Persons or damages to property, which may arise from or in 1719 connection with the performance of the work hereunder and the results of that work by Contractor, 1720 his agents, representatives, employees or Subcontractors. 1721 B. Coverages and Requirements.
1722 1. Minimum Coverages. Coverage shall be at least as broad as:
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Restated Service Agreement January 27, 2026 -45- City of Modesto/Bertolotti Modesto Disposal, Inc. 1723 a. Commercial General Liability (CGL) – Insurance Services Office Form CG 00 01 covering 1724 CGL on an “occurrence” basis, including products and completed operations, property 1725 damage, bodily injury, and personal & advertising injury, with limits no less than ten 1726 million dollars ($10,000,000) per occurrence. If a general aggregate limit applies, either 1727 the general aggregate limit shall apply separately to this project/location (ISO CG 25 03 1728 or 25 04) or the general aggregate limit shall be twice the required occurrence limit. 1729 b. Automobile Liability – ISO Form Number CA 00 01 covering any auto (Code 1), or if 1730 Contractor has no owned autos, hired (Code 8) and non-owned autos (Code 9), with 1731 limit no less than ten million dollars ($10,000,000) per accident for bodily injury and 1732 property damage.
1733 c. Workers’ Compensation – As required by the State of California, with Statutory Limits, 1734 and Employer’s Liability Insurance with limit of no less than one million dollars 1735 ($1,000,000) per accident for bodily injury or disease. 1736 d. Contractor’s Pollution Legal Liability and/or Asbestos – With limits no less than 5 1737 million dollars ($5,000,000) per occurrence or claim, and five million dollars 1738 ($5,000,000) policy aggregate.
1739 e. Employee Crime or Fidelity Bond – Five hundred thousand dollars ($500,000) per 1740 employee loss covering dishonesty, forgery, alteration, theft, disappearance, and 1741 destruction (inside or outside).
1742 f. Transportation Pollution Liability – When applicable, the Automobile Liability policy 1743 shall be endorsed to include Transportation Pollution Liability insurance, covering 1744 materials to be Transported by Contractor pursuant to the Agreement. This coverage 1745 may also be provided on Contractor’s Pollution Liability policy. 1746 C. Umbrella or Excess Coverage. Contractor may use umbrella or excess policies to provide the liability 1747 limits as required in this Agreement. This form of insurance will be acceptable, provided that all of 1748 the primary and umbrella or excess policies shall provide all of the insurance coverages herein 1749 required, including, but not limited to, primary and non-contributory, additional insured, Self1750 Insured Retentions (SIRs), indemnity, and defense requirements. The umbrella or excess policies 1751 shall be provided on a true “following form” or broader coverage basis, with coverage at least as 1752 broad as provided on the underlying CGL insurance. No insurance policies maintained by the 1753 additional insureds, whether primary or excess, and which also apply to a loss covered hereunder, 1754 shall be called upon to contribute to a loss until Contractor’s primary and excess liability policies are 1755 exhausted.
1756 The insurance policies are to contain, or be endorsed to contain, the following provisions:
1757 1. Additional Insured Status. The City, its officers, officials, employees, and volunteers are to be 1758 covered as additional insureds on the CGL policy, with respect to liability arising out of work 1759 or operations performed by or on behalf of Contractor, including materials, parts, or 1760 equipment furnished in connection with such work or operations. General liability coverage 1761 can be provided in the form of an endorsement to Contractor’s insurance, with coverage 1762 equal to ISO form CG 2010. For completed operations, a separate endorsement equal to ISO 1763 form CG 2037 is required.
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Restated Service Agreement January 27, 2026 -46- City of Modesto/Bertolotti Modesto Disposal, Inc. 1764 2. Primary Coverage. The additional insured coverage under Contractor’s policy shall be 1765 “primary and non-contributory,” will not seek contribution from the City’s insurance or self1766 insurance, and shall be at least as broad as CG 20 01 04 13. The City does not accept 1767 endorsements limiting Contractor’s insurance coverage to the sole negligence of the Named 1768 Insured.
1769 3. Notice of Cancellation. Each insurance policy required above shall provide that coverage shall 1770 not be canceled, except with notice to the City.
1771 D. Claims Made Policies. (Applicable to Pollution Liability only) If any of the required policies provide 1772 claims-made coverage:
1773 1. Retroactive Date. The retroactive date must be shown and must be before the 1774 Commencement Date or the Effective Date.
1775 2. Maintenance of Insurance. Insurance must be maintained, and evidence of insurance must 1776 be provided for at least five (5) years after expiration of the Agreement. 1777 3. Coverage Canceled or Non-Renewed. If coverage is canceled or non-renewed and not 1778 replaced with another claims-made policy form with a retroactive date prior to the 1779 Agreement Effective Date, Contractor must purchase “extended reporting” coverage for a 1780 minimum of five (5) years after completion of work. 1781 4. Waiver of Subrogation. Contractor hereby grants to the City of Modesto a waiver of any right 1782 to subrogation, which any insurer of said Contractor may acquire against the City of Modesto 1783 by virtue of the payment of any loss under such insurance. Contractor agrees to obtain any 1784 endorsement that may be necessary to affect this waiver of subrogation, but this provision 1785 applies regardless of whether or not the City of Modesto has received a waiver of subrogation 1786 endorsement from the insurer.
1787 5. Self-Insured Retentions. All self-insured retentions must be disclosed to Risk Management for 1788 approval and shall not reduce the limits of liability. The City of Modesto may require 1789 Contractor to purchase coverage with a lower retention or provide proof of ability to pay 1790 losses and related investigations, claim administration, and defense expenses within the 1791 retention. Any and all deductibles and SIRs shall be the sole responsibility of Contractor or 1792 Subcontractor who procured such insurance and shall not apply to the indemnified additional 1793 insured parties.
1794 6. Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best’s 1795 rating of no less than A:VII, unless otherwise acceptable to the City. 1796 7. Verification of Coverage. Contractor shall furnish the City with original certificates and 1797 amendatory endorsements or copies of the applicable policy language effecting coverage 1798 required by this clause, a copy of the Declarations and Endorsements Pages of the CGL, and 1799 any excess policies listing all policy endorsements. All certificates and endorsements are to be 1800 received and approved by the City Risk Management before work commences. However, 1801 failure to obtain the required documents prior to the work beginning shall not waive 1802 Contractor’s obligation to provide them. The City reserves the right to require complete, 1803 certified copies of all required insurance policies, including endorsements required by these #6..
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Restated Service Agreement January 27, 2026 -47- City of Modesto/Bertolotti Modesto Disposal, Inc. 1804 specifications, at any time. The City reserves the right to obtain a full certified copy of any 1805 insurance policy and endorsements. Failure to exercise this right shall not constitute a waiver 1806 of right to exercise later.
1807 8. Subcontractors. Contractors shall require and verify that all Subcontractors, or other parties 1808 hired for this work, purchase and maintain coverage for indemnity and insurance 1809 requirements, at least as broad as specified in this Agreement, to the extent they apply to the 1810 scope of the Subcontractor’s work, with the same certificate of insurance requirements and 1811 naming as additional insureds all Parties to this Agreement. 1812 9. Special Risks or Circumstances. The City of Modesto reserves the right to modify these 1813 requirements, including limits, based on the nature of the risk, prior experience, insurer, 1814 coverage, or other special circumstances and this will be treated as a City-directed change in 1815 scope, pursuant to Section 3.5.
1816 10. Certificate Holder Address. Proper address for mailing certificates, endorsements, and notices 1817 shall be:
1818 City of Modesto
1819 Attn: Risk Management
1820 1010 10th Street
1821 Modesto, CA, 95353
1822 9.3 Performance Bond
1823 Within seven (7) Days of the City’s notification to Contractor that the City has executed this Agreement, 1824 Contractor shall file with the City a bond, payable to the City, securing Contractor's performance of its 1825 obligations under this Agreement. Such bond shall be renewed annually, if necessary, so that the 1826 performance bond is maintained at all times during the Term. The principal sum of the bond shall be one 1827 million dollars ($1,000,000) or five percent (5%) of annual Gross Receipts, whichever is greater, and shall 1828 be adjusted every three (3) years, commencing with Rate Period Three. The bond shall be executed as 1829 surety by a corporation authorized to issue surety bonds in the State of California that has a rating of A or 1830 better in the most recent edition of Best’s Key Rating Guide, and that has a record of service and financial 1831 condition satisfactory to the City.
1832 ARTICLE 10.
1833 DEFAULT AND REMEDIES
1834 10.1 Events of Default
1835 All provisions of the Agreement are considered material. Each of the following shall constitute an event 1836 of default.
1837 A. Fraud or Deceit. Contractor practices, or attempts to practice, any fraud or deceit upon the City. 1838 B. Insolvency or Bankruptcy. Contractor becomes insolvent, unable, or unwilling to pay its debts, or 1839 upon listing of an order for relief in favor of Contractor in a bankruptcy proceeding. #6..
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Restated Service Agreement January 27, 2026 -48- City of Modesto/Bertolotti Modesto Disposal, Inc. 1840 C. Failure to Maintain Coverage. Contractor fails to provide or maintain in full force and affect the 1841 workers' compensation, liability, or indemnification coverage, as required by this Agreement. 1842 D. Violations of Regulation. Contractor violates any orders or filings of any regulatory body having 1843 authority over Contractor relative to this Agreement, provided that Contractor may contest any 1844 such orders or filings by appropriate proceedings conducted in good faith, in which case no breach 1845 or default of this Agreement shall be deemed to have occurred. 1846 E. Violations of Applicable Law. Contractor violates Applicable Law relative to this Agreement. 1847 F. Failure to Perform Direct Services. Contractor ceases to provide Collection, Transportation, or 1848 Processing services, as required under this Agreement, for a period of two (2) consecutive Days or 1849 more, for any reason within the Control of Contractor. 1850 G. Failure to Pay or Report. Contractor fails to make any payments to the City required under this 1851 Agreement, including payment of City Reimbursements or Liquidated Damages, and/or refuses to 1852 provide City with required information, reports, and/or records in a timely manner, as provided for 1853 in the Agreement.
1854 H. Acts or Omissions. Any other act or omission by Contractor that violates the terms, conditions, or 1855 requirements of this Agreement, or Applicable Law, and that is not corrected or remedied within 1856 the time set in the written notice of the violation or, if Contractor cannot reasonably correct or 1857 remedy the breach within the time set forth in such notice, if Contractor should fail to commence 1858 to correct or remedy such violation within the time set forth in such notice and diligently effect such 1859 correction or remedy thereafter.
1860 I. False, Misleading, or Inaccurate Statements. Any representation or disclosure made to the City by 1861 Contractor in connection with, or as an inducement to, entering into this Agreement, or any future 1862 amendment to this Agreement, which proves to be false or misleading in any material respect as of 1863 the time such representation or disclosure is made, whether or not any such representation or 1864 disclosure appears as part of this Agreement; and any Contractor-provided report containing a 1865 misstatement, misrepresentation, data manipulation, or an omission of fact or content explicitly 1866 defined by the Agreement, excepting non-numerical typographical and grammatical errors. 1867 J. Seizure or Attachment. There is a seizure of, attachment of, or levy on some or all of Contractor’s 1868 operating equipment, including, without limits, its equipment, maintenance or office facilities, 1869 Approved Facility(ies), or any part thereof.
1870 K. Suspension or Termination of Service. There is any termination or suspension of the transaction of 1871 business by Contractor related to this Agreement, including, without limit, due to labor unrest 1872 including strike, work stoppage or slowdown, sick-out, picketing, or other concerted job action 1873 lasting more than five (5) Days.
1874 L. Criminal Activity. Contractor, its officers, managers, or employees are found guilty of criminal 1875 activity related directly or indirectly to performance of this Agreement or any other agreement held 1876 with the City.
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Restated Service Agreement January 27, 2026 -49- City of Modesto/Bertolotti Modesto Disposal, Inc. 1877 M. Assignment without Approval. Contractor transfers or assigns this Agreement without the 1878 expressed written approval of the City, unless the assignment is permitted without City approval 1879 pursuant to Section 12.6.
1880 N. Failure to Provide Proposal or Implement Change in Service. Contractor fails to provide a proposal 1881 for new services or changes to services, or fails to implement a change in service, as requested by 1882 the City, as specified in Section 3.5.
1883 O. Failure to Implement Collection Program. Contractor fails to implement a Collection program that 1884 complies with the requirements of Article 4 and Exhibit B, which is essential for the City to achieve 1885 compliance with SB 1383.
1886 P. Failure to Provide Processing Capacity. Contractor fails to provide adequate Processing capacity in 1887 accordance with Section 4.2, which is essential for the City to achieve compliance with SB 1383. 1888 Q. Failure to Achieve Processing Standards. Contractor fails to achieve the Processing standards 1889 specified in Section 4.2, which are essential for the City to achieve SB 1383 compliance. 1890 R. Failure to Comply with Other Requirements of SB 1383. Contractor fails to comply with other 1891 requirements of the Agreement, including, but not limited to, public education, contamination 1892 monitoring, recordkeeping and reporting, or other obligations of this Agreement that delegate the 1893 City’s responsibility and/or authority under SB 1383 to Contractor. 1894 S. Failure to Perform Any Obligation. Contractor fails to perform any obligation established under this 1895 Agreement.
1896 The City shall provide Contractor written notice of default within seven (7) Days of the City’s first 1897 knowledge of Contractor’s default.
1898 10.2 Contractor’s Right To Cure; City’s Right to Terminate Upon Event of Default 1899 Contractor shall be given ten (10) Business Days from written notification by the City to cure any default 1900 which, in the City Contract Manager’s sole opinion, creates a potential public health and safety threat. 1901 Contractor shall be given ten (10) Business Days from written notification by the City to cure any default 1902 arising under Subsections C, E, F, I, J, or M in Section 10.1; provided, however, that the City shall not be 1903 obligated to provide Contractor with a notice and cure opportunity if Contractor has committed the same 1904 or similar breach/default within a twenty-four (24)-month period. 1905 Contractor shall be given thirty (30) Days from written notification by the City to cure any other default 1906 (which is not required to be cured within ten (10) Business Days); however, the City shall not be obligated 1907 to provide Contractor with a notice and cure opportunity if Contractor has committed the same or similar 1908 breach/default within a twenty-four (24)-month period. 1909 10.3 City’s Remedies in the Event of Default
1910 Upon Contractor’s default, the City has the following remedies:
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Restated Service Agreement January 27, 2026 -50- City of Modesto/Bertolotti Modesto Disposal, Inc. 1911 A. Waiver of Default. The City may waive any event of default or may waive Contractor’s requirement 1912 to cure a default event if the City determines that such waiver would be in the best interest of the 1913 City. The City’s waiver of an event of default is not a waiver of future events of default that may 1914 have the same or similar conditions.
1915 B. Suspension of Contractor’s Obligation. The City Council may suspend Contractor’s performance of 1916 its obligations if Contractor fails to cure default in the time frame specified in Section 10.2 until such 1917 time Contractor can provide assurance of performance in accordance with Section 10.7. 1918 C. Liquidated Damages. The City may assess Liquidated Damages for Contractor’s failure to meet 1919 specific performance standards, pursuant to Section 10.5 and Exhibit F. 1920 D. Termination.
1921 1. Public Hearing. The City Contract Manager may, in their sole discretion, set a public hearing 1922 for the City Council to determine whether to terminate this Agreement. Subject to 1923 Contractor’s right to cure as described in Section 10.2, such termination hearing must be set 1924 if a default remains uncured thirty (30) Days after receipt of written notice of default from 1925 the City. Such termination hearing must also be set if a Contractor’s default is not cured within 1926 ten (10) Days and the default:
1927 a. Creates a potential public health and safety threat; or 1928 b. Arises under Subsection 10.1.C, E, F, I, J, or M. 1929 2. Action Upon Termination. If the City terminates this Agreement based on the adopted 1930 findings of the termination hearing, the City Contract Manager shall first provide written 1931 notice to Contractor twenty (20) Days before the date of termination. Contractor shall 1932 thereafter be relieved on a going-forward basis of all liabilities and obligations required by 1933 this Agreement, except for Section 9.1, and any other provisions specifically identified to 1934 survive termination of this Agreement. Upon expiration of the twenty (20)-Day notice, the 1935 City may, in its sole discretion:
1936 a. Directly undertake performance of the services; or 1937 b. Arrange with other Persons to perform the services with or without a written 1938 agreement; or
1939 c. Permit Contractor to continue operating under this Agreement, including Contractor’s 1940 Compensation, until such time that City is able to find substitute services. 1941 This right of termination is in addition to any other rights upon a failure of Contractor to perform its 1942 obligations under this Agreement.
1943 Contractor shall not be entitled to any further revenues from Collection operations authorized 1944 hereunder from and after the date of termination, with the exception of Section 10.3.D.2.C. #6..
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Restated Service Agreement January 27, 2026 -51- City of Modesto/Bertolotti Modesto Disposal, Inc. 1945 E. Other Available Remedies. The City’s election of one (1) or more remedies described herein shall 1946 not limit the City from any and all other remedies at law and in equity, including injunctive relief, 1947 etc.
1948 10.4 Possession of Records Upon Termination
1949 In the event of termination or expiration of this Agreement, Contractor shall furnish City Contract 1950 Manager with access to all of its business records, including without limitation, Proprietary Contractor 1951 computer systems, related to its Customers, Collection routes, and billing of accounts for Collection 1952 services.
1953 10.5 Performance Standards and Liquidated Damages
1954 A. General. The Parties find that, as of the time of the execution of this Agreement, it is impractical, if 1955 not impossible, to reasonably ascertain the extent of damages which shall be incurred by the City 1956 as a result of a breach by Contractor of its obligations under this Agreement. The factors relating to 1957 the impracticability of ascertaining damages include, but are not limited to, the fact that: (i) 1958 substantial damage results to members of the public who are denied services or denied quality or 1959 reliable service; (ii) such breaches cause inconvenience, anxiety, frustration, and deprivation of the 1960 benefits of the Agreement to individual members of the general public for whose benefit this 1961 Agreement exists, in subjective ways and in varying degrees of intensity, which are incapable of 1962 measurement in precise monetary terms; (iii) exclusive services might be available at substantially 1963 lower costs than alternative services and the monetary loss resulting from denial of services or 1964 denial of quality or reliable services is impossible to calculate in precise monetary terms; and (iv) 1965 the termination of this Agreement for such breaches, and other remedies, are, at best, a means of 1966 future correction and not remedies which make the public whole for past breaches. 1967 B. Service Performance Standards; Liquidated Damages for Failure to Meet Standards. The Parties 1968 further acknowledge that consistent, reliable Collection services, congruent with industry best 1969 practice, are of utmost importance to the City, and that City has considered and relied on 1970 Contractor's representations as to its quality of service commitment in awarding the Agreement to 1971 Contractor. The Parties recognize that some quantified standards of performance are necessary and 1972 appropriate to ensure consistent and reliable service and performance. The Parties further 1973 recognize that if Contractor fails to achieve the performance standards, or fails to submit required 1974 documents in a timely manner, the City and its residents and businesses will suffer damages, and 1975 that it is, and will be, impractical and extremely difficult to ascertain and determine the exact 1976 amount of damages which City will suffer. Therefore, without prejudice to the City’s right to treat 1977 such non-performance as an event of default under this Section, the Parties agree that the 1978 Liquidated Damage amounts established in Exhibit F of this Agreement represent a reasonable 1979 estimate of the amount of such damages, considering all of the circumstances existing on the 1980 Effective Date of this Agreement, including the relationship of the sums to the range of harm to the 1981 City, that reasonably could be anticipated, and the anticipation that proof of actual damages would 1982 be costly or impractical.
1983 City may assess (as Liquidated Damages and not as a penalty) the amounts set forth in Exhibit F, 1984 Performance Standards and Liquidated Damages.
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Restated Service Agreement January 27, 2026 -52- City of Modesto/Bertolotti Modesto Disposal, Inc. 1985 Before assessing Liquidated Damages, the City shall give Contractor notice of its intention to do so. 1986 The notice will include a brief description of the incident(s) and non-performance. The City may 1987 review (and make copies at its own expense) all information in the possession of Contractor relating 1988 to the incident(s) and/or non-performance. The City may, within ten (10) Business Days after issuing 1989 the notice, request a meeting with Contractor. The City shall present evidence of non-performance 1990 in writing and through testimony of its employees and others relevant to the incident(s) and non1991 performance. The City Contract Manager shall provide Contractor with a written explanation of 1992 their determination on each incident(s) and non-performance prior to authorizing the assessment 1993 of Liquidated Damages under this Section. The City Contract Manager will determine the final 1994 outcome; however, Contractor has the option to pursue and exhaust any further administrative 1995 remedies.
1996 C. Amount. Upon final determination, the City may assess Liquidated Damages for each calendar Day 1997 or event, as appropriate, that Contractor is determined to be liable, in accordance with this 1998 Agreement, in the amounts specified in Exhibit F, subject to annual adjustment described below. 1999 D. Timing of Payment. Upon final determination, Contractor shall pay any Liquidated Damages 2000 assessed by the City under this Agreement within thirty (30) Business Days of the date the 2001 Liquidated Damages are assessed. If they are not paid within the thirty (30) Business Day period, 2002 the City may proceed against the performance bond required by the Agreement, order the 2003 termination of the rights granted by this Agreement, or all of the above. 2004 10.6 Excuse from Performance
2005 The Parties understand and agree herein that the services provided under this Agreement are critical to 2006 the protection of public health and safety and that Contractor is expected to perform these services, 2007 despite the occurrence of events that may otherwise give rise to force majeure conditions. The Parties 2008 herein agree that the obligations for excuse from performance under this Agreement should and do have 2009 a higher standard than the general law understanding of force majeure. In particular, a Party shall be 2010 excused from performing their obligations hereunder and from any obligations to pay Liquidated Damages 2011 if they are prevented from so performing by reason of floods, earthquakes, other acts of nature, war, civil 2012 insurrection, riots, acts of any domestic government (including judicial action), and other similar 2013 catastrophic events that are beyond the Control of and not the fault of the Party claiming excuse from 2014 performance hereunder. However, performance shall only be excused if the Party requesting relief from 2015 performance can specifically demonstrate that the performance of a specific obligation is impossible, and 2016 shall only be excused from those requirements that are demonstrated to be impossible. All other 2017 performance obligations that remain possible shall be required to continue. 2018 In the case of labor unrest or job action directed at a third party, over whom Contractor has no Control, 2019 the inability of Contractor to provide services in accordance with this Agreement due to the unwillingness 2020 or failure of the third party to: (i) provide reasonable assurance of the safety of Contractor's employees 2021 while providing such services; or (ii) make reasonable accommodations with respect to Container 2022 placement and point of delivery, time of Collection, number of Persons necessary to make Collections, or 2023 other operating circumstances to minimize any confrontation with pickets shall, to that limited extent, 2024 excuse performance. The foregoing excuse shall be conditioned on Contractor's cooperation in 2025 performing Collection services at different times and in different locations. Further, in the event of labor 2026 unrest, including, but not limited to, strike, work stoppage or slowdown, sick-out, picketing, or other 2027 concerted job action conducted by Contractor’s employees or directed at Contractor, or a subsidiary, #6..
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Restated Service Agreement January 27, 2026 -53- City of Modesto/Bertolotti Modesto Disposal, Inc. 2028 Contractor shall not be excused from performance. In such case, Contractor shall continue to provide a 2029 reasonably satisfactory level of performance during the pendency thereof, but Contractor shall not be 2030 required to adhere strictly to the specific requirements of this Agreement regarding routes, Collection 2031 times or similar matters; provided, however, that in no event shall more than seven (7) Days elapse 2032 between pickups for Residential and Commercial Customers. Any labor action initiated by Contractor, 2033 including, but not limited to, a lock-out, shall not be grounds for any excuse from performance and 2034 Contractor shall perform all obligations under this Agreement during the pendency of such Contractor2035 initiated labor action. 2036 The Party claiming excuse from performance shall, within two (2) Days after such Party has notice of such 2037 cause, give the other Party notice of the facts constituting such cause and asserting its claim to excuse 2038 under this Section.
2039 If either Party validly exercises its rights under this Section, the Parties hereby waive any claim against 2040 each other for any damages sustained thereby.
2041 The partial or complete interruption or discontinuance of Contractor's services caused by one (1) or more 2042 of the events described in this Article shall not constitute a default by Contractor under this Agreement. 2043 Notwithstanding the foregoing, if Contractor is excused from performing its obligations hereunder for any 2044 of the causes listed in this Section for a period of thirty (30) Days or more, the City shall nevertheless have 2045 the right, in its sole discretion, to terminate this Agreement by giving ten (10) Business Days’ notice to 2046 Contractor, in which case the provisions of Section 10.4 shall apply. 2047 10.7 Right to Demand Assurances of Performance
2048 The Parties acknowledge that it is of the utmost importance to the City, and the health and safety of all 2049 those members of the public residing or doing business within the City who will be adversely affected by 2050 interrupted waste management service, that there be no material interruption in services provided under 2051 this Agreement.
2052 If Contractor: (i) is the subject of any labor unrest, including work stoppage or slowdown, sick-out, 2053 picketing, or other concerted job action; (ii) appears in the reasonable judgment of the City to be unable 2054 to regularly pay its bills as they become due; or (iii) is the subject of a civil or criminal judgment or order 2055 entered by a Federal, State, regional, or local agency for violation of an Applicable Law, and the City 2056 believes in good faith that Contractor's ability to perform under the Agreement has thereby been placed 2057 in substantial jeopardy, the City may, at its sole option and in addition to all other remedies it may have, 2058 demand from Contractor reasonable assurances of timely and proper performance of this Agreement, in 2059 such form and substance as the City believes in good faith is reasonably necessary in the circumstances 2060 to evidence continued ability to perform under the Agreement. If Contractor fails or refuses to provide 2061 satisfactory assurances of timely and proper performance in the form and by the date required by the 2062 City, such failure or refusal shall be an event of default for purposes of Section 10.1. 2063 10.8 Dispute Resolution
2064 In the event of dispute between the City Contract Manager and Contractor regarding the interpretation 2065 of or the performance of services under this Agreement that results in a material impact to Contractor’s 2066 revenue and/or cost of operations, as defined in Section 5.9, the provisions of this Section shall apply. #6..
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Restated Service Agreement January 27, 2026 -54- City of Modesto/Bertolotti Modesto Disposal, Inc. 2067 A. Notice. Notice from either Party must consist of electronic mail in addition to a certified letter to 2068 the other Party.
2069 B. Meet and Confer. In the event of disputes regarding the performance of any obligation under this 2070 Agreement that results in a material impact to Contractor’s revenue and/or cost of operations, the 2071 City and Contractor agree that they will promptly meet and confer to attempt to resolve the matter 2072 between themselves.
2073 C. Mediation. In the event that disputes arising under this Agreement cannot be resolved satisfactorily 2074 between the Parties in accordance with Subsection 10.8.B, the City and Contractor agree that such 2075 disputes shall be submitted to mandatory, non-binding mediation by a mutually agreed-upon 2076 independent third party. Mediation shall not exceed three (3) months from the first date of 2077 mediation. If during the allowable three (3) month period of mediation, the mediator rules that the 2078 Parties are at an impasse, Parties may proceed to litigation without further discussion. 2079 D. Period of Time. Insofar as allowed by Applicable Law, the period of time otherwise applicable for 2080 filing claims against the City under Applicable Law shall be tolled during the period of time for which 2081 meet-and-confer or mediation procedures are pending, in accordance with Subsections 10.8.B 2082 and 10.8.C.
2083 E. Litigation. Litigation may commence once the time allowed for mediation has expired, or the 2084 mediator has ruled that the Parties are at an impasse pursuant to Subsections 10.8.A, 10.8.B, 2085 and 10.8.C. Nothing in this Section shall exercise performance with the Government Claims Act, 2086 Government Code Section 810 et seq.
2087 ARTICLE 11.
2088 REPRESENTATIONS AND WARRANTIES OF
2089 THE PARTIES
2090 The Parties, by acceptance of this Agreement, represents and warrants the conditions presented in this 2091 Article.
2092 11.1 Contractor’s Corporate Status
2093 Contractor is a corporation duly organized, validly existing, and in good standing under the laws of the 2094 State. It is qualified to transact business in the State and has the power to own its properties and to carry 2095 on its business as currently owned and operated and as required by this Agreement. 2096 11.2 Contractor’s Corporate Authorization
2097 Contractor has the authority to enter this Agreement and perform its obligations under this Agreement. 2098 The Board of Directors of Contractor (or the shareholders, if necessary) has taken all actions required by 2099 law, its articles of incorporation, its bylaws, or otherwise, to authorize the execution of this Agreement. 2100 The Person signing this Agreement on behalf of Contractor represents and warrants that they have 2101 authority to do so. This Agreement constitutes the legal, valid, and binding obligation of Contractor. #6..
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Restated Service Agreement January 27, 2026 -55- City of Modesto/Bertolotti Modesto Disposal, Inc. 2102 11.3 Agreement Will Not Cause Breach
2103 To the best of Contractor's and the City’s knowledge, after reasonable investigation, the execution or 2104 delivery of this Agreement or the performance by either Party of their obligations hereunder does not 2105 conflict with, violate, or result in a breach: (i) of any Applicable Law; or (ii) any term or condition of any 2106 judgment, order, or decree of any court, administrative agency, or other governmental authority, or any 2107 agreement or instrument to which Contractor or the City is a party or by which Contractor or any of its 2108 properties or assets are bound or constitutes a default hereunder. 2109 11.4 No Litigation
2110 To the best of Contractor's and the City’s knowledge, after reasonable investigation, there is no action, 2111 suit, proceeding, or investigation, at law or in equity, before or by any court or governmental authority, 2112 commission, board, agency, or instrumentality decided, pending, or threatened against either Party 2113 wherein an unfavorable decision, ruling, or finding, in any single case or in the aggregate, would:
2114 A. Materially adversely affect the Party’s performance of its obligations hereunder. 2115 B. Adversely affect the validity or enforceability of this Agreement. 2116 C. Materially adversely affect the financial condition of Contractor, or any surety or entity 2117 guaranteeing Contractor's performance under this Agreement. 2118 11.5 No Adverse Judicial Decisions
2119 To the best of Contractor’s and the City’s knowledge, after reasonable investigation, there is no judicial 2120 decision that would prohibit this Agreement or subject this Agreement to legal challenge. 2121 11.6 No Legal Prohibition
2122 To the best of each Party’s knowledge, after reasonable investigation, there is no Applicable Law in effect 2123 on the date that each Party signed this Agreement that would prohibit the performance of either of their 2124 obligations under this Agreement and the transactions contemplated hereby. 2125 11.7 Contractor’s Ability to Perform
2126 Contractor possesses the business, professional, and technical expertise to perform all services, 2127 obligations, and duties, as described in and required by this Agreement, including all Exhibits thereto. 2128 Contractor possesses the ability to secure equipment, facility, and employee resources required to 2129 perform its obligations under this Agreement.
2130 ARTICLE 12.
2131 OTHER AGREEMENTS OF THE PARTIES
2132 12.1 Relationship of Parties
2133 The Parties intend that Contractor shall perform the services required by this Agreement as an 2134 independent Contractor engaged by the City and neither as an officer nor employee of the City, nor as a #6..
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Restated Service Agreement January 27, 2026 -56- City of Modesto/Bertolotti Modesto Disposal, Inc. 2135 partner or agent of, or joint venturer with, the City. No employee or agent of Contractor shall be, or shall 2136 be deemed to be, an employee or agent of the City. Contractor shall have the exclusive Control over the 2137 manner and means of performing services under this Agreement, except as expressly provided herein. 2138 Contractor shall be solely responsible for the acts and omissions of its officers, employees, Subcontractors, 2139 and agents. Neither Contractor nor its officers, employees, Subcontractors, and agents shall obtain any 2140 rights to retirement benefits, workers' compensation benefits, or any other benefits which accrue to City 2141 employees by virtue of their employment with City. 2142 12.2 Compliance with Law
2143 Contractor shall, at all times, at its sole cost, comply with all Applicable Laws, permits, and licenses of the 2144 United States, the State, County, and the City, and with all applicable regulations promulgated by Federal, 2145 State, regional, or local administrative and regulatory agencies, now in force and as they may be enacted, 2146 issued, or amended during the Term.
2147 12.3 Governing Law
2148 This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the 2149 State.
2150 12.4 Jurisdiction
2151 Any lawsuits between the Parties arising out of this Agreement shall be brought and concluded in the 2152 courts of the County of Stanislaus, which shall have exclusive jurisdiction over such lawsuits. With respect 2153 to venue, the Parties agree that this Agreement is made in and will be performed in the County of 2154 Stanislaus.
2155 12.5 Binding on Successors
2156 The provisions of this Agreement shall inure to the benefit to and be binding on the successors and 2157 permitted assigns of the Parties.
2158 12.6 Assignment
2159 Neither Party shall assign its rights nor delegate or otherwise transfer its obligations under this Agreement 2160 to any other Person without the prior written consent of the other Party. Any such assignment made 2161 without the consent of the other Party shall be void and the attempted assignment shall constitute a 2162 material breach of this Agreement.
2163 For purposes of this Section, "Assignment" shall include, but not be limited to: (i) a sale, exchange, or 2164 other transfer of substantially all of Contractor's local, regional, and/or corporate assets dedicated to 2165 service under this Agreement to a third party; (ii) a sale, exchange, or other transfer of ten percent (10%) 2166 or more of the local, regional, and/or corporate assets, stock, or ownership of Contractor to a Person 2167 (other than a transfer of shares in Contractor by the owner of such shares to a revocable trust for the 2168 benefit of their family or to another owner of shares in Contractor) except that no cumulative sale, 2169 exchange, or transfer of shares may exceed twenty percent (20%) during the Term of the Agreement 2170 (other than a transfer of shares in Contractor by the owner of such shares to a revocable trust for the 2171 benefit of their family or to another owner of shares in Contractor); (iii) any reorganization, consolidation, 2172 merger, recapitalization, stock issuance or re-issuance, voting trust, pooling agreement, escrow #6..
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Restated Service Agreement January 27, 2026 -57- City of Modesto/Bertolotti Modesto Disposal, Inc. 2173 arrangement, liquidation, or other transaction to which Contractor or any of its shareholders is a party 2174 that results in a change of ownership or Control of ten percent (10%) or more of the value or voting rights 2175 in the local, regional, and/or corporate stock of Contractor; (iv) divestiture of an Affiliate (e.g., trucking 2176 company, materials recovery facility, or Transfer station) used by Contractor to fulfill its obligations under 2177 this Agreement; and (v) any combination of the foregoing (whether or not in related or contemporaneous 2178 transactions) that has the effect of any such transfer or change of local, regional, and/or corporate 2179 ownership and/or Control of Contractor. For purposes of this Section, the term "Proposed Assignee" shall 2180 refer to the proposed transferee(s) or other successor(s) in interest pursuant to the Assignment. 2181 Contractor acknowledges that this Agreement involves rendering a vital service to the City's residents and 2182 businesses, and that City has selected Contractor to perform the services specified herein based on: (i) 2183 Contractor's experience, skill, and reputation for conducting its Recyclable Materials, Organic Materials, 2184 and Garbage management operations in a safe, effective, and responsible fashion, at all times in keeping 2185 with applicable waste management laws, regulations, and good waste management practices; and (ii) 2186 Contractor's financial resources on a local, regional, and/or corporate level to maintain the required 2187 equipment and support its indemnity obligations to the City under this Agreement. The City has relied on 2188 each of these factors, among others, in choosing Contractor to perform the services to be rendered by 2189 Contractor under this Agreement.
2190 If Contractor requests the City's consideration of and consent to an Assignment, the City may deny or 2191 approve such request in its sole and complete discretion. No request by Contractor for consent to an 2192 Assignment need be considered by the City unless and until Contractor has met the following 2193 requirements. The City may, in its sole discretion, waive one (1) or more of these requirements. 2194 A. Contractor shall pay the City its actual expenses for attorneys’, consultants’, and accountants’ fees; 2195 staff time; and investigation costs necessary to investigate the suitability of any Proposed Assignee, 2196 and review and finalize any documentation required as a condition for approving any such 2197 Assignment. Such payment shall be required regardless of the ultimate determination of the City 2198 with regard to the approval or denial of the Assignment. Upon submittal of Contractor’s request for 2199 Assignment to the City, Contractor shall submit an initial deposit of one hundred thousand dollars 2200 ($100,000) for this purpose.
2201 B. Upon approval of Proposed Assignee, Contractor shall furnish City with reviewed financial 2202 statements of the Proposed Assignee's operations for the immediately preceding three (3) 2203 operating years.
2204 C. Contractor shall furnish City with satisfactory proof that: (i) the Proposed Assignee has at least ten 2205 (10) years of Recyclable Materials, Organic Materials, and Garbage management experience on a 2206 scale equal to or exceeding the scale of operations conducted by Contractor under this Agreement; 2207 (ii) in the last five (5) years, the Proposed Assignee has not suffered any citations or other censure 2208 from any Federal, State, or local contractor having jurisdiction over its waste management 2209 operations due to any significant failure to comply with State, Federal, or local waste management 2210 laws, and that the assignee has provided the City with a complete list of such citations and censures; 2211 (iii) the Proposed Assignee has, at all times, conducted its operations in an environmentally safe and 2212 conscientious fashion; (iv) the Proposed Assignee conducts its operations and management 2213 practices in accordance with sound waste management practices in full compliance with all Federal, 2214 State, and local laws regulating the Collection, Transportation, Processing, and Disposal of 2215 Recyclable Materials, Organic Materials, and Garbage, including Hazardous Waste; and (v) any other #6..
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Restated Service Agreement January 27, 2026 -58- City of Modesto/Bertolotti Modesto Disposal, Inc. 2216 information required by the City demonstrates that the Proposed Assignee can fulfill the terms of 2217 this Agreement in a timely, safe, and effective manner. 2218 D. Contractor shall provide the City with any and all additional records or documentation which, in the 2219 City Contract Manager’s sole determination, would facilitate the review of the proposed 2220 Assignment.
2221 Under no circumstances shall any proposed Assignment be considered by the City if Contractor is in 2222 default at any time during the period of consideration. If, in the City’s sole determination, there is any 2223 doubt regarding the compliance of Contractor with the Agreement, the City may require an audit of 2224 Contractor’s compliance, and the costs of such audit shall be paid by Contractor in advance of the 2225 performance of said audit.
2226 12.7 No Third Party Beneficiaries
2227 This Agreement is not intended to, and will not be construed to, create any right on the part of any third 2228 party to bring an action to enforce any of its terms. 2229 12.8 Waiver
2230 The waiver by either Party of any breach or violation of any provisions of this Agreement shall not be 2231 deemed to be a waiver of any breach or violation of any other provision, nor of any subsequent breach of 2232 violation of the same provision or any other provision. No waiver of any provision of this Agreement shall 2233 be binding, unless authorized by the waiving Party in writing. The subsequent acceptance by either Party 2234 of any monies that become due hereunder shall not be deemed to be a waiver of any preexisting or 2235 concurrent breach or violation by the other Party of any provision of this Agreement. 2236 12.9 Notice Procedures
2237 All notices, demands, requests, proposals, approvals, consents, and other communications that this 2238 Agreement requires, authorizes, or contemplates shall be in writing and shall either be personally 2239 delivered to a representative of the Parties at the address below, deposited in the United States mail, first 2240 class postage prepaid, addressed as follows:
2241 If to the City:
2242 City of Modesto, Solid Waste Division
2243 Attn: City Contract Manager
2244 P.O. Box 642
2245 Modesto, CA, 95353
2246
2247 If to Contractor:
2248 ____________________
2249 ____________________
2250 ____________________
2251 ____________________ Commented [SP8]: Note: Contractor to populate. #6..
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Restated Service Agreement January 27, 2026 -59- City of Modesto/Bertolotti Modesto Disposal, Inc. 2252 The address to which communications may be delivered may be changed from time to time by a notice 2253 given in accordance with this Section. Notice shall be deemed given on the Day it is personally delivered 2254 or, if mailed, three (3) Days from the date it is deposited in the mail. Either Party may choose to provide 2255 email notification to the other Party that a written notice has been deposited in the mail, but such email 2256 notification shall not constitute official notice. 2257 12.10 Representatives of the Parties
2258 References in this Agreement to the “City” shall mean the City’s elected body and all actions to be taken 2259 by the City, except as provided below. The City may delegate, in writing, authority to the City Contract 2260 Manager and/or to other City officials and may permit such officials, in turn, to delegate in writing some 2261 or all of such authority to subordinate officers. Contractor may rely upon actions taken by such delegates 2262 if they are within the scope of the authority properly delegated to them. 2263 Contractor shall, by the Effective Date, designate in writing a responsible officer who shall serve as the 2264 representative of Contractor in all matters related to the Agreement and shall inform the City in writing 2265 of such designation and of any limitations upon their authority to bind Contractor. The City may rely upon 2266 action taken by such designated representative as actions of Contractor unless they are outside the scope 2267 of the authority delegated to them by Contractor, as communicated to the City. 2268 ARTICLE 13.
2269 MISCELLANEOUS AGREEMENTS
2270 13.1 Entire Agreement
2271 This Agreement is the entire agreement between the Parties with respect to the subject matter hereof 2272 and supersedes all prior and contemporaneous oral and written agreements and discussions. Each Party 2273 has cooperated in the drafting and preparation of this Agreement and this Agreement shall not be 2274 construed against any Party on the basis of drafting. This Agreement may be amended only by an 2275 agreement in writing, signed by each of the Parties hereto. 2276 13.2 Capitalized Terms
2277 Capitalized terms not defined herein shall have the meaning provided for in Exhibit A, attached hereto 2278 and incorporated herein.
2279 13.3 Section Headings
2280 The Article headings and Section headings in this Agreement are for convenience of reference only and 2281 are not intended to be used in the construction of this Agreement nor to alter or affect any of its 2282 provisions.
2283 13.4 References to Laws
2284 All references in this Agreement to laws and regulations shall be understood to include such laws as they 2285 may be subsequently amended or recodified, unless otherwise specifically provided herein. #6..
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Restated Service Agreement January 27, 2026 -60- City of Modesto/Bertolotti Modesto Disposal, Inc. 2286 13.5 Amendments
2287 This Agreement may not be modified or amended in any respect, except in writing signed by the Parties. 2288 13.6 Severability
2289 If any non-material provision of this Agreement is for any reason deemed to be invalid and unenforceable, 2290 the invalidity or unenforceability of such provision shall not affect any of the remaining provisions of this 2291 Agreement, which shall be enforced as if such invalid or unenforceable provision had not been contained 2292 herein.
2293 13.7 Counterparts
2294 This Agreement may be executed in counterparts, each of which shall be considered an original. 2295 13.8 Exhibits
2296 Each of the Exhibits identified as Exhibit “A” through “K” is attached hereto, incorporated herein, and 2297 made a part hereof by this reference. In the event of a conflict between the terms of this Agreement and 2298 the terms of an Exhibit, the terms of this Agreement shall Control. 2299
#6..
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Restated Service Agreement January 27, 2026 -61- City of Modesto/Bertolotti Modesto Disposal, Inc. 2300 IN WITNESS WHEREOF, this Agreement is entered into by the Parties hereto in Stanislaus County, 2301 California on the Day and year first above written. 2302
City of Modesto
A Municipal Corporation “CITY”
“CONTRACTOR”
________ Date
Mayor
Signature Date
Print Name of Signatory
________ Date
City Manager
Title of Signatory
The Foregoing Agreement Has been
Reviewed and Approval Is Recommended:

Signature Date
________ Date
Public Works Director
Print Name of Signatory
Title of Signatory
APPROVED AS TO FORM:
________ Date
City Attorney
__City___ Business License #
Resolution Number XXXX-XXX
ATTEST: Approved by City Council
________ Date
City Clerk
2303
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-1-
MAXIMUM CHARGES FOR SOLID WASTE SERVICE – MAY 1, 2026
RESIDENTIAL CONTAINERS - Maximum Monthly Rate
Standard container service includes the following:
 1 container each for garbage and organics picked up weekly, 1 container for recycling picked up bi-weekly
 2 bulky item collections per year by appointment
 City tree maintenance; collection & composting of green waste and forestry materials  Removal of illegally dumped items in streets and alleys  Drop off program for household hazardous waste
Base Rate (96 gal cart)* $ 47.86
Green Waste $ 5.44
Geer Road Landfill $ 0.81
Compost Facility Improvements $ 1.70
City Implementation $ 1.05
Recycling Fees $ 0.46
Carpenter Road Landfill $ 0.70
Maximum Monthly Rate $ 58.02
*With City approval, 64 gal carts for Garbage can be made available with a base rate of $44.69, all other fees apply for a total monthly cost of $54.85.

Additional Garbage Container - $16.09 each per month picked up weekly (96 gal) Additional Garbage Container - $12.92 each per month picked up weekly (64 gal) Additional Organics Container Weekly - $16.09 each per month picked up weekly Additional Recycling Container - $10.03 each per month picked up bi-weekly Containers must be placed in a location set forth in Section 5-5.121 of the MMC. #6..
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-2-
COMMERCIAL AND MULTIFAMILY CONTAINERS - Maximum Monthly Rate Weekly rental for Containers shall not exceed the rate for 1 pick-up per week for each size container.

Bin Maximum Rates
Number of Collections Per Week
Container Size 1 2 3 4 5 6
1 CY $76.23 $152.45 $228.68 $304.90 $381.12 $457.36
2 CY $152.45 $304.90 $457.36 $609.81 $762.26 $914.71
3 CY $228.68 $457.36 $686.03 $914.71 $1,143.39 $1,372.07 4 CY $304.90 $609.81 $914.71 $1,219.62 $1,524.52 $1,829.42 5 CY $381.12 $762.24 $1,143.36 $1,524.48 $1,905.60 $2,286.72 6 CY $457.36 $914.71 $1,372.07 $1,829.42 $2,286.78 $2,744.13 96 Gallon Cart Maximum Rates
Material Type Number of Collection Per Week
1 2 3 4 5 6
Garbage/Recycling/Organics $26.41 $52.81 $79.22 $105.62 $132.03 $158.43 64 Gallon Cart Maximum Rates
Material Type Number of Collection Per Week
1 2 3 4 5 6
Garbage $23.24 $46.47 $69.71 $92.95 $116.18 $139.42
Base Rate $ 57.09
Green Waste $ 11.04
Geer Road Landfill $ 0.95
Compost Facility Improvements $ 3.08
Litter Abatement $ 0.59
City Implementation $ 1.90
Recycling Fees $ 0.63
Carpenter Road Landfill $ 0.95
Maximum Rate 1 Cubic Yard $ 76.23
#6..
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-3-
DROP BOX CONTAINERS – Maximum Rate Per Pick-Up
Actual disposal charges are paid and negotiated directly between the customer and the solid waste company. The solid waste company will provide up to 40CY Drop Box containers for stated charges subject only to load limit of transfer vehicle.

An AB 939 Green Waste Diversion Fee of $18.55 per ton is added to the disposal charges.

Base Rate $ 430.67
Geer Road Landfill $ 29.77
Carpenter Road Landfill $ 29.77
Recycling Fees $ 19.71
Maximum Rate Per Pick Up $528.47
Rental Fees
$0.85 per day up to 7-day maximum rental
$3.00 per day for boxes kept 7 or more days without servicing $10.00 per day for boxes kept 21 or more days without servicing #6..
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-4-
COMPACTORS – Maximum Monthly Rate
Compactor Rates
Container NUMBER OF COLLECTIONS PER WEEK
Size 1 2 3 4 5 6
3 CY $686.03 $1,372.07 $2,058.09 $2,744.12 $3,430.15 $4,116.18 4 CY $914.71 $1,829.44 $2,744.16 $3,658.88 $4,573.60 $5,488.32 6 CY $1,372.07 $2,744.14 $4,116.21 $5,488.32 $6,860.35 $8,232.42 Other Compactor Fees
 Hospital Waste Compactors $278.73.00 per pick-up
 Washing Compactor $47.53
 Disposal Charge Actual charge to be paid by customer
 AB939 Green Waste Diversion Fee $18.55 per ton

EXTRA PICKUPS
Standard containers or equivalent $3.50 plus $2.30/container Detachable containers $12.00 plus $4.15/cubic yard

SPECIAL SERVICE CONDITIONS
In situations where none of the above maximum rates reasonably apply, the cost of service is to be negotiated between the solid waste company and the customer.

COMMERCIAL CONTAINER ONLY–Replacement and Cleaning Services 1 CY 1½ CY 2 CY 3 CY 4 CY 5 CY 6 CY
$10.12 $11.00 $12.10 $15.40 $20.24 $25.08 $29.92
NOTATION: Pursuant to Section 11-6.15(b)(2) of the Modesto Municipal Code, the solid waste company may require a deposit equivalent to two months service charge from customers prior to beginning service. The deposit will be credited back to the customer after 18 months under specified conditions.
#6..
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3 SCHEDULE OF CASH SECURITY DEPOSITS AND FEES FOR
SELF-HAUL RESIDENTS AND BUSINESSES – MAY 1, 2026
Pursuant to the Modesto Municipal Code, Section 5-5.130, any person, other than a collector who has an agreement with the City, who wishes to remove and dispose of waste created or produced on premises they occupy or control must first provide a cash security deposit to the City. Such deposits shall be based on the following criteria:

Applications must be renewed every three (3) years.

A security deposit shall be made for each separate residential dwelling, multifamily, or business location owned or controlled by a non-customer.

For any residential, multifamily, or commercial property that is currently served by an authorized collector, the City shall contact the collector and determine the existing service level being provided. The City shall require a cash security deposit based on the formula noted and defined below based on the service level.

For any residential, multifamily, or commercial property that is not currently serviced by an authorized collector, the City shall consult with the authorized collector assigned to the service address and determine an appropriate service level. The City shall require a cash security deposit based on the formula noted and defined below.

DEPOSIT
RESIDENTIAL OR COMMERCIAL – CART SERVICE
a. For any residential, multifamily, or commercial property that is, or would be served by carts, the cash security deposit shall be equal to:
60 months x $58.02 (Maximum Monthly Rate)

RESIDENTIAL OR COMMERCIAL- BIN SERVICE
b. For any multifamily, or commercial property that is, or would be served by bins, the cash security deposit shall be equal to:
$5,000 (Base Deposit) x Multiplier = Cash Security Deposit a. Multiplier: Total number of cubic yards in bin(s) times the number of collections per week
#6..
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4 ANNUAL AB 939 FEE
RESIDENTIAL OR COMMERCIAL – CART SERVICE
Those residential, multifamily, or commercial properties participating in the Self-Haul program will be required to pay to the City of Modesto an annual AB939 Fee of 9.9% of the annual garbage rate.
a. The formula for any residential, multifamily, or commercial property that is, or would be served by carts, the annual AB939 fee will be equal to:
$58.02 (Maximum Monthly Rate) x 12 months x 9.9%

RESIDENTIAL OR COMMERCIAL- BIN SERVICE
a. The formula for any multifamily, or commercial property that is, or would be served by bin, the annual AB939 fee will be equal to:
$76.23 (Maximum Rate 1 cubic yard) x (Number of cubic yards in bin(s)) x (number of pick-ups per week) x (12 months) x 9.9%
#6..
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CITY of MODESTO
Office of the
City Manager
1010 Tenth Street
Suite 6]00
P.O. Box 642
M odesto, CA 95353
2091577-5223
2091571-5]28 Fax
Hearing and SPeech
Impaired Only
TDD 2091526-9211
Mr. Bert Bertolotti
President & CEO
Bertolotti Disposal Service
P.O. Box 127
Ceres, Ca 95307
December 5, 2007
RE: Letter Amendment to 2001 Service Agreement (As Previously Amended) Dear Mr. Bertolotti:

On December 4th, 2007, the Modesto City Council authorized me to execute a Letter Amendment to the Service Agreement currently held by Bertolotti Disposal Service to extend the 200 I Service Agreement (as previously amended) through September 18, 2014. The Council also authorized a change to the Agreement to automatically extend the term of the Agreement for an additional year on September 18th of each year, unless the City notifies the company in writing of its intent to not extend the Agreement prior to that date.

This letter constitutes an Amendment to the 2001 Service Agreement (as previously amended) between the City of Modesto and Bertolotti Disposal Service. Section a of the 2001 Agreement (as previously amended) is hereby amended to read as follows:
"This Service Agreement shall be in force for a term of seven (7) calendar years commencing on September 18, 2007. On each anniversary of this agreement the term will automatically be extended one (1) additional year, until such time as either the CITY or the COLLECTOR submits in writing to the other that it is their intent to terminate said agreement. This Service Agreement, or any extensions thereof, may be terminated under the provisions of this Service Agreement or the provisions of Chapter 5 of Title V ofthe Modesto Municipal Code. Nothing herein shall be deemed or construed to impair or affect in any way the right of the CITY to acquire the equipment and assume the operations of COLLECTOR at any time during the initial term of this Service Agreement or any extensions thereof by purchase of COLLECTOR'S equipment at a fair and just market value, which shall not include any amount for the Service Agreement itself or for any of the rights or privileges granted by this Service Agreement. "
Ctlizem FII]"/.'
#6..
- 361 -
Mr. Bert Bertolotti
Bertolotti Disposal Service
December 5, 2007
Page Two
Section b, paragraph I of the 2001 Agreement (as previously amended) is hereby amended to read as follows:
"The CITY may terminate this Service Agreement on September 18,2012, if COLLECTOR has not reasonably satisfied each of the following preconditions to the sole satisfaction of the CITY, notwithstanding the provisions of the more general language of paragraph c. making "reasonableness" a requirement of any discretionary decision relating to the performance of this Agreement. The CITY may cause the termination by written notification of the collector prior to July 18,2012." Section b, paragraph 2 of the 2001 Agreement (as previously amended) is hereby amended to read as follows:
"Notwithstanding any other provisions herein, the CITY may terminate this Service Agreement for its convenience, without cause, upon a decision by the CITY to assume, with its' employees, performance of the services required of COLLECTOR hereunder.

This Service Agreement shall terminate sixty days after CITY gives COLLECTOR written notice of its election to terminate this Service Agreement. Upon such termination by CITY, CITY shall pay to the COLLECTOR the anticipated return on COLLECTOR's capital investment for two years, if such notice is given on or before July 18, 2010; for eighteen months, if such notice is given after July 18,2010 but on or before July 18,2011; for one year if such notice is given afterJuly 18, 2011 but on or before July 18, 2012; and for six months if such notice is given after July 18,2012." All of the other current terms and conditions of the 2001 Agreement, (as previously amended), will remain in full force and effect. Copies of the Council Resolution and Consent Form are attached for your reference.

We look forward to continuing to work with Bertolotti Disposal Service in a cooperative business relationship that will ensure our community's residents and businesses the highest level of service. Should you have any questions, please contact Jocelyn Reed, Solid Waste Manager, at (209) 577-5492.

Si"=I,, ~
~ City Manager
cc: City Attorney
Parks, Recreation and Neigbborhoods Director
Attachments: Consent Form
Council Resolution
#6..
- 362 -
CONSENT TO LETTER AMENDMENT TO 2001 SERVICE AGREEMENT
(AS PREVIOUSLY AMENDED)
This Letter Amendment to the 2001 Service Agreement (as previously amended) shall go into effect and be in full force and operation upon execution by both parties thereto.

IN WITNESS WHEREOF, the parties have agreed to this Letter Amendment to the 2001 Service Agreement (as previously amended) this 4 day of December, 2007.

COLLECTOR* ~
BY U~'
ATTEST: ~ fv(~
Jean Morris, City Clerk
(SEAL)
APPROVED AS TO LEGAL FORM :

By
Susana
Q-Alcala ~ Wood, City Attorney
APPROVED AS TO RISK MANAGEMENT FORM:
*Corporations nature of two (2) officers required or one (1) officer plus corporate seal.

Partnership - signature of a partner required
Sole Proprietorship - signature of proprietor require
#6..
- 363 -
CITY of MODESTO
Office of the
City Manager
1010 Tenth Street
Suite 6100
P.O. Box 642
Modesto, CA 95353
209/577-5223
209/571-5128 Fax
Hearing and SPeech
Impaired Only
TDD 209/526-9211
December 18, 2006
Bert Bertolotti, President & CEO
Bertolotti Disposal Service
P.O. Box 127
Ceres, Ca 95307
Re: I..p.tter Amendment to 2001 Service 1~.9r2 emenL (,liS P( Gu:;lV Ar(\ended) Dear Mr. Bertolotti:

On November 8th, 2006, the Modesto City Council held a public hearing to consider reallocating Waste Management's service area to Bertolotti Disposal Service and Gilton Solid Waste Management. At that hearing, the Council authorized me to execute a Letter Amendment to the Service Agreements currently held by Bertolotti Disposal Service and Gilton Solid Waste Management to reference the revised service area maps approved by the Council at the hearing.

The companies are to begin serving the newly reallocated areas effective January 1, 2007. In addition, the Council directed that language be added to require the both companies to notify the City of their intent to stop providing coliection services in Modesto no less than 18 months prior to ceasing to provide the serv!ces.

This letter constitutes an Amendment to the 2001 Service Agreement (as previously amended) between the City of ~1odesto and Bertolotti Disposal Service. The following sections of the 2001 Agreement (as previously amended) are hereby amended to read as follows:

Paragraph i of Section b shail be amended to read; 'This Servic2 Agreement shall be an exclusive Service Agreement to collect commerciai/residcntial garbage/recyclables and containerized yard waste and a nonexclusive Service Agreement to collect industrial garbage, salvageable waste, and recyclable mater:als within the areas delineated and marked on that certain map entitled "Option 2: City of Modesto Proposed Two Hauler Districts" dated November 8, 2006, on file in the office of the cm Clerk, and to which reference is hereby made. COLLECTOR shall commence providing services to existing customers within those portions of the (ity formerly served by Waste Management and reallocated to COLLECTOR in the above referenced map effective January 1, 2007."
Citizens First.'
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Letter to Bert Bertolotti, President & CEO, Bertolotti Disposal Service December 18, 2006
Re: Letter Amendment to 2001 Service Agreement (As Previously Amended)

Page 2 ends

Finance CommitteeDecember 17, 2025

Finance Committee
December 17, 2025