City Council Agenda Report
January 20, 2026
TO: Honorable City Council
FROM: Jesus M. Gomez, City Manager
BY: Albert Mendoza, Director of Public Services/City Engineer Mario Mera, Engineering Division Manager
Run Chen, Principal Civil Engineer
Randall Hillman, Associate Engineer
SUBJECT: RESOLUTION NO. 26-11 – INTENTION TO CONSIDER GRANTING A NON-
PUBLIC UTILITY PIPELINE FRANCHISE TO HERAEUS METAL
PROCESSING, INCORPORATED
Background:
The California Public Utilities Code (CPUC) (Article 6231.5) and the Norwalk Municipal Code (NMC) (Title 13, Chapter 13.20 Pipeline Franchises) requires any person, firm, or corporation utilizing public streets for the conveyance of oil, gasoline, petroleum, wet gas, hydrocarbon substances, water, wastewater, mud, steam, or other products to have a valid franchise with the City.
On November 21, 2006, City Council granted a pipeline franchise to Heraeus Metal Processing, Incorporated (HMPI) to construct and operate a 6-inch diameter, high-density polyethylene (HDPE) wastewater line along Alondra Boulevard from Shoemaker Avenue to Studebaker Road. The franchise term was for 15 years expiring on November 21, 2021.
HMPI is a refiner and recycler of precious metals, including gold, silver, and platinum group metals from spent industrial catalysts and other primary and secondary materials. Additionally, HMPI manufactures precious metals containing chemical compounds for the automotive, chemical, and pharmaceutical industries; fabricates precious metal catalysts for nitric acid and fertilizer plants.
The HDPE pipe conveys treated wastewater from the HMPI facility in Santa Fe Springs along Alondra Boulevard through the Cities of Norwalk and Santa Fe Springs, then connects to a Los
City Council January 20, 2026
Resolution No. 26-11 – Granting Pipeline
Franchise to Heraeus Metal Processing, Inc.
Page No. 2
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Angeles County Sanitation District (LACSD) sewer trunk line at the intersection of Alondra Boulevard and Studebaker Road for final processing.
State law governs and regulates non-public utility water franchise pipelines. The requested renewal pipeline franchise agreement with HMPI would be in accordance with CPUC Article 6231.5 and NMC Title 13, Chapter 13.20. Among other items, State law establishes the franchise payment(s) for water franchises which includes the base granting fee ($7,500) and the base annual fee payments determined through a formula based on pipeline internal diameter, pipe length, and fee per lineal foot. Per NMC Title 13, Article 13, Chapter 13.20.310 Rates, the amount of each base fee specified in subsections C and D shall be adjusted at the time payment is due by the percentage change in the Consumer Price Index, all Urban Consumers for the Los Angeles-Anaheim-Riverside area (1982-84 = 100).
The City reserves the right to adjust the base annual fees established hereunder at any time after the effective date of the ordinance, but the base fees applicable to any one franchise may only be changed five times during the life of the franchise.
HMPI has continuously paid the City $9,000 per year since expiration of the franchise. HMPI requests to continue the franchise with terms and conditions per the existing franchise with the exception of updated fees as negotiated with the City.
Purpose of Resolution
The purpose of Resolution No. 26-11 is to declare the City Council’s intention to consider granting a franchise to HMPI and set a public hearing date for the matter to be considered.
Adoption of the resolution does not create an obligation to grant a franchise.
Fiscal Impact:
There is revenue to be realized with granting of the franchise. The City would receive a base granting fee of $7,500 and annual payments based on a formula associated with the internal diameter and length of the pipelines adjusted per the Consumer Price Index.
The proposed annual payments are as follows:
Annual Franchise Fee
2022 2023 2024 2025
2021 Base Fee $9,000 $9,000 $9,000 $9,000
CPI Factor 1.317325 1.393344 1.428546 1.511685*
$11,855.93 $12,540.10 $12,856.92 $13,605.17*
*CPI Factor Estimate for November 2025
Citizens Advised:
N/A
City Council January 20, 2026
Resolution No. 26-11 – Granting Pipeline
Franchise to Heraeus Metal Processing, Inc.
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Strategic Plan 2023 Implementation:
The recommended actions will further the City’s Strategic Plan Goal 3: Create and sustain a resilient and economically prosperous city.
Recommended Action:
Staff recommend City Council adopt Resolution No. 26-11, A RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF NORWALK DECLARING ITS INTENTION TO CONSIDER
GRANTING A NON-PUBLIC UTILITY PIPELINE FRANCHISE TO HERAEUS METAL PROCESSING, INCORPORATED; and schedule a public hearing for February 17, 2026.
Attachments:
Resolution No. 26-11