Public Works Agency
www.santa-ana.org/pw
Item # 12
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
July 7, 2026
TOPIC: Memorandum of Understanding with Republic Services Related to Waste Infrastructure System Enterprise Agreement with County of Orange
AGENDA TITLE
Memorandum of Understanding with Republic Services Related to Waste Infrastructure System Enterprise Agreement with County of Orange (Non-General Fund)
RECOMMENDED ACTION
Authorize the City Manager to execute a Memorandum of Understanding with Republic Services to formalize the refuse rate stabilization plan associated with the County of Orange Waste Infrastructure System Enterprise agreement for FY 2026-27 (Agreement No. A-2026-XXX).
GOVERNMENT CODE §84308 APPLIES: Yes
BACKGROUND & DISCUSSION
On January 27, 2026, the Orange County Board of Supervisors (the “County”) adopted a new Waste Infrastructure System Enterprise (WISE) Agreement, establishing updated regional rates for municipal solid waste disposal at County landfills. The agreement introduces a phased increase in landfill disposal rates beginning July 1, 2026, thereby increasing the City’s cost of providing solid waste services. While landfill disposal costs have increased, the WISE agreement remains the most cost-effective landfill alternative due to the County’s control of the regional landfill system and overall higher costs of feasible alternatives.
To address the adopted changes made by the County, on April 21, 2026, the City Council approved the WISE agreement with the County and directed staff to implement a one-year rate stabilization strategy to manage and address the financial impacts of the new rates. This approach utilizes available reserves in the City’s Refuse Enterprise Fund to offset disposal cost increases for residential, multi-family, and commercial customers, preventing the immediate pass-through of the WISE agreement related costs during the one-year period. This one-year measure will allow time for the City to complete the Proposition 218 regulatory compliant process in order to implement a new
Memorandum of Understanding with Republic Services Related to Waste Infrastructure System Enterprise Agreement with County of Orange
July 7, 2026
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4 8
rate structure, aligning the City’s costs for providing solid waste disposal services caused by the increases adopted by the County.
The proposed Rate Stabilization Memorandum of Understanding (MOU) with Republic Services (Exhibit 1) will facilitate the implementation of the City’s rate stabilization strategy and formalizes the financial arrangement between the City and Republic Services for Fiscal Year 2026-27. The MOU maintains existing Franchise Agreement provisions, including applicable fees and adjustments, while introducing a rate stabilization approach to address increased landfill disposal costs resulting from the WISE Agreement. The use of Refuse Enterprise Fund resources is limited to eligible landfill disposal-related costs and is intended as a temporary measure through June 30, 2027.
Approval of the MOU will allow time for the City to complete the Proposition 218 process and establish a long-term refuse rate structure that reflects the increased disposal costs under the new WISE Agreement.
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
As discussed in the April 21, 2026 staff report, the WISE Agreement increases the landfill disposal rates charged by the County beginning July 1, 2026. The City will reimburse Republic Services for the increased disposal costs as part of the approved rate stabilization strategy. The estimated annualized financial impact of the increased landfill disposal rates is approximately $6.8 million. The FY 2026-27 adopted budget includes $3.4 million, representing approximately six months of the estimated annualized cost and providing adequate time for the City to process and implement a new rate structure during FY 2026-27.
No additional appropriation is being requested at this time. Staff will continue to monitor funding needs throughout the fiscal year, and any additional funding requirements will be presented to the City Council for consideration and appropriation at a later date.
Fiscal
Year
Accounting
Unit – Account
No.
(Project No.)
Fund
Description
Accounting Unit,
Account Description Amount
CURRENT BUDGET
2026-27 06917640-
62300
Refuse
Collection
Service
Refuse Collection
Service, Contract
Services -
Professional
$3,400,000
Memorandum of Understanding with Republic Services Related to Waste Infrastructure System Enterprise Agreement with County of Orange
July 7, 2026
5 8
4 8
TOTAL $3,400,000
EXHIBIT(S)
1. Memorandum of Understanding with Republic Services
Submitted By: Rodolfo Rosas, P.E., Acting Executive Director of Public Works Agency Approved By: Alvaro Nuñez, City Manager