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22 SOLID WASTE SVCS 12-06-99
12-06-99 DATE: DECEMBER 6, 1999 TO: FROM: SUBJECT: WILLIAM A. HUSTON, CITY MANAGER PUBLIC WORKS DEPARTMENT/ENGINEERING DIVISION APPROVAL OF SPECIFICATIONS AND AUTHORIZATION TO ADVERTISE FOR BIDS FOR SOLID WASTE MANAGEMENT SERVICES SUMMARY Staff is recommending that the City Council approve the specifications for solid waste services and direct the City Clerk to advertise for bids. The proposed specifications will require the hauler to a) provide a fully automated, three-cart residential recycling program, b) offer enhanced recycling programs to commercial customers and, c) achieve sufficient solid waste diversion to comply with the State's 50% landfill diversion requirement. RECOMMENDATION It is recommended that the City Council adopt Resolution No. 99-101 approving the specifications for Solid Waste Management Services and directing the City Clerk to advertise for bids. FISCAL IMPACT There is no fiscal impact with this action. seven-year term is $45 million. The approximate value of this agreement over the BACKGROUND In 1994, City voters approved Measure J that amended the City Code to require utilization of a Public Works bid process for any new solid waste franchise agreement. The current solid waste franchise agreement with Great Western Reclamation (GWR), a division of Waste Management of Orange County, expires on June 30, 2000. The existing service consists of the manual collection of residential and commercial waste with processing and recovery of recyclable materials at Waste Management's Sunset Environmental Material Recovery Facility. Residual waste is then disposed in an Orange CountY Landfill or diverted to a waste-to-energy facility in Long Beach. On May 17, 1999, the City Council approved a professional services agreement with Hilton, Farnkopf and Hobson (HFH) to prepare the bid specifications for a new solid waste contract. On August 16, 1999, the City Council conducted a workshop to discuss solid waste collection and recycling program options. The key issues discussed at this workshop were as follows: Approval of Specifications and Authorization to Advertise for Bids for Solid Waste Management Services December 6, 1999 Page 2. · State of California requirements regarding diversion of waste from landfills (AB-939). · Public Works bid process and legal requirements. · Separate bids for residential and commercial customers. · Collection cart options. HFH completed its assessment of the current services and developed a bid document that attempts to balance public and solid waste industry issues while implementing the consensus of the City Council and ensuring compliance with State law. While developing this document, HFH performed an audit of customer and service data provided by GWR. In addition, staff circulated a draft of the RFB documents to interested haulers in order to solicit comments. Staff received responses from seven haulers included in the mailing. The issues identified were generally technical in nature and appropriate changes and clarifications have been incorporated into the final bid specifications. While evaluating the current level of service and determining future service requirements, the overriding concern of staff remains City compliance with State recycling and landfill diversion requirements. AB-939 and subsequent implementing regulations mandated that the City recycle or divert from landfills 25% of the City's 1990 landfill disposal tonnage by 1995. In the year 2000, the mandated diversion percentage will double to 50%. Failure to comply with this mandate could result in fines levied by the State of up to $10,000 per day. The California Integrated Waste Management Board (CIWMB) has determined that the City is making a "good faith effort" and is in compliance with the 1995 25% diversion mandate. While the current level of solid waste service provides compliance with the 1995 mandate, it is certain that the City will not comply with the year 2000 50% diversion mandate with the current level of service. Staff believes that a hauler diversion rate of 55-60% is the' minimum necessary to insure that the City has an effective State calculated diversion rate of at least 50%. This is due to the fact that additional waste is "self-hauled: to County landfills by individuals and other contracts (i.e. landscape and building contractors). In 1998, GWR collected 75,750 tons of waste. Residential customers generated 24% of the waste collected. Commercial customers, including multi family units, produce 76% of the waste collected. Approximately 48% of the City's waste is recyclable material. In 1998, 22,032 tons or 29% of the total waste stream was recycled or diverted from County landfills. Approximately 50% of tonnage recycled was not actually recycled at the Sunset Material Recovery Facility as it consists of waste that was transported to a waste to energy facility in Long Beach. Approval of Specifications and Authorization to Advertise for Bids for Solid Waste Management Services December 6, 1999 Page 3 The City's Source Reduction and Recycling Element (SRRE), prepared in 1990, estimates that 11.7% of the City's total waste stream is green waste. This number is based on a detailed "waste characterization study" of the City's residential waste stream. Other generally accepted industry data indicates that the amount could be as much as 25%. Staff tends to rely on the figures .cited in the SRRE based on Tustin's residential mix and Great Western's green waste recycling records. Staff also believes that a significant portion of the City's residential and commercial green waste is hauled directly to landfills by landscapers, and therefore, the hauler does not collect or, more importantly, recycle the material. In 1998, apprOximately 4,587 tons or 25.5% of the City's annual residential waste stream was green waste. These figures appear to be consistent with industry data. 2,859 tons of residential green waste or 62% was recycled. Using the SRRE assumptions and percentages, if all collected residential green waste was recycled and current MRFing practices were continued for all other waste, then the City's hauler recycling rate would only. increase by 2-5% to a maximum of 34%. The largest increase in the hauler's recycling rate can be achieved by recycling mixed paper, metals and plastics. Together, these materials make up 50% of the residential waste stream and 14% of the City's total waste stream. 30% of commercial sector waste is recyclable material. Commercial customers also help by implementing voluntary internal programs that reduce the amount of waste generated for collection. Source reduction programs are currently unmeasured but potentially represent a significant amount of future waste diversion if properly documented to the CIWMB. The State calculated diversion rate takes into account all waste processed by the City's hauler and all waste disposed in landfills by self-haulers. The current diversion rate is approximately 25%. Staff anticipates that the hauler must divert or recycle a minimum of 55% of the total collected waste stream in order to achieve the State's 50% diversion goal. For example, in 1998, the hauler diverted or recycled 29% of the collected waste stream, whereas the State calculated rate includes other sources of waste and barely reached 25%. In consideration of the issues identified by the City Council, staff and other interested parties, the final bid specifications incorporate the following key features: · A single exclusive franchise agreement for all residential and commercial solid waste services. · An automated three-cart residential collection program that is intended to be responsive to the needs of individual customers. · The availability of recycling services for all commercial customers on a voluntary basis. Approval of Specifications and Authorization to Advertise for Bids for Solid Waste Management Services December 6, 1999 Page 4 · Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) indemnification. · Flat rate charges for single family residents with property tax billing · Easy to understand rate calculation method · Increased public education · Increased waste diversion performance requirements to comply with AB 939 · Improved hauler performance reporting The residential collection program is the most significant change in the total scope services. Initially, most single-family residential customers (including units in duplexes and triplexes) will be provided with three collection carts. One cart will be provided for green waste only, another for mixed.recyclables, and a third cart for general refuse. Customers can return the green waste and mixed recyclable carts if they have space limitations or if'they do not intend to participate in the recycling program. Conversely, if residents do utilize these carts and need additional capacity, additional green carts will be provided for no additional cost. The general refuse cart is required for all single-family customers in order to facilitate the use of automated collection vehicles. If a single-family customer requires an additional general refuse cart, then the customer will be charged an additional monthly fee ($4) for that cart. Since the residential recycling program is considered voluntary, this program feature is the sole incentive for customers to participate in the recycling program. As this is a public works bid document, there is no requirement for the haulers to meet minimum qualifications. The City Attorney has carefully reviewed state law and determined that it currently precludes prequalifying bidders for public works contracts. However, HFH and staff have included a "Responsible Bidders Information" checklist in the bid document to provide the City with some indication as to whether a particular hauler has the means and experience to perform the required scope of work. Potential bidders will be required to complete this form, but most likely will not be disqualified for a negative response to any questions. They could, however, be disqualified as being non-responsive if they fail to complete the form in their bid submittal. Another issue concerns the purchase and ownership of refuse and recycling carts. Some haulers have indicated that financing the carts would be onerous to them and result in extra costs to customers. Staff has taken the position that the City does not wish to become responsible for financing the acquisition of carts and assuming the administrative burdens and costs that accompany cart ownership. Staff has determined that the purchase of carts by haulers would add approximately fifty cents per residential customer per month and that other operational cost savings by haulers would most likely offset this cost. Additionally, the City would not be responsible for administrative costs associated with the acquisition and maintenance of cart inventory. The City has retained the option to assume full ownership of carts at the conclusion of this contract term, in case the City wishes to reduce cart acquisition costs with the next contract. Approval of Specifications and Authorization to Advertise for Bids for Solid Waste Management Services December 6, 1999 Page 5 In conclusioh, a three-cart collection system provides the City with the maximum residential recycling in order to comply with State law. Staff believes that the three-cart system and the . aggressive commercial source reduction and recycling program identified in the specifications will- resUlt in the foil°wing approximate landfill diversion/recycling percentages and clearly demonstrate a good faith effort to the CIWMB. The table below demonstrates the approximate landfill diversion percentages that the City will most likely attain with the new contract. Recovery of residential recyclables includes green waste and all other recyclable materials obtained from the three-cart prOgram. Commercial recyclable recovery includes all materials recovered by MRF processing and source separation programs at specific businesses. Commercial Source reduction programs include efforts by local businesses to prevent waste from entering the waste stream. This can include a myriad of minor initiatives voluntarily instituted by businesses, which result in a decrease in waste volume generated and disposed. The State is beginning to recognize these source reduction programs as a previously unmeasured component of waste reduction. The final item is the diversion of waste to a transformation facility (waste-to-energy). State law permits up to ten percent of landfill diversion to be obtained by this method in the year 2000. Staff anticipates that the selected hauler will utilize the most cost effective program component to obtain the desired 50% landfill diversion requirement, while still complying with contract requirements. Consequently, the actual diversion percentages for various program components will likely vary depending upon the selected haulers capabilities and preferences. As explained previously, the City's selected hauler will be required to attain a 55-60% hauler diversion rate in order to comply with the State's 50% mandate. Pro_qram Component 80% of Residential recyclables recovered 50% Commercial recyclables recovered Approximate Commercial source reduction (non-public programs not measured in waste stream reports) Diversion of waste to a permitted Waste to Energy facility TOTAL: Estimated hauler diversion 15% 15% 15% 10% 55% Approval of Specifications and Authorization to Advertise for Bids for Solid Waste Management Services December 6, 1999 Page 6 The City Attorney has' reviewed and modified the draft bid document and has approved it as to form. The project is generally following the schedule previously identified by staff. It is possible that service implementation may be delayed for reasons beyond the control of the hauler (i.e. equipment order/delivery time frame) and the schedule has been modified accordingly. Authorization to advertise for bids .............. .................................................... 12/6/99 First Legal Advertisement ............................................................................. 12/17/99 Second Legal Advertisement ........................................................................ 12/24/99 Bid Opening .............................. : .............................................................. ; ...... 1/18/00 Award of Contract ................................................................................... Feb. 2000 Service Implementation ......................................... July 1, 2000 to October 1,2000 ity Engineer TDS:JM:ccg:Apprvl of Specs for Solid Waste & Reso 99-101 .doc Attachment Senior Management Analyst, Public Works RESOLUTION NO. 99-101 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN, CALIFORNIA APPROVING SPECIFICATIONS FOR SOLID WASTE MANAGEMENT SERVICES WHEREAS, it is the intention of the City Council of the City of Tustin, California to approve the specifications for the new solid waste management services agreement and authorize the City Clerk to advertise for bids; and WHEREAS, staff has presented specifications for the,provision of said solid waste management services; and NOW, THEREFORE, BE IT RESOLVED that the specifications presented by the City Engineer are hereby approved as the specifications for solid waste management services; BE IT FURTHER RESOLVED that the City Clerk is hereby authorized and directed to advertise as required by law for the receipt and sealed bids or proposals for the doing of the work specified in the aforesaid plans and specifications; BE IT FURTHER. RESOLVED that this project is categorically exempt from the requirements of the California Environmental Quality Act. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Tustin held on Monday, December 6, 1999. Tracy Wills Worley, Mayor ATTEST: City Clerk CITY OF TUSTIN REQUEST FOR BIDS FOR INTEGRATED SOLID '~¥ASTE MANAGEMENT SERVICES December 1, 1999 Prepared by: Hilton Famkopf & Hobson, LLC 3990 WESTERLY PLACE, SUITE 195 NEWPORT BEACH, CA 92660-231 Telephone: 949 / 251-8628 Fa:r: 949 / 251-9741 THE CITY OF TUSTIN REQUEST FOR BIDS FOR INTEGRATED SOLID WASTE MANAGEMENT SERVICES December I, 1999 The City of Tustin is requesting bids for collection, transportation, recycling, processing, and disposal of solid waste, recyclables, and yard waste. Copies of this Request for Bid (RFB) package may ,be obtained in person or by written request, which should include.your company s overnight mail account number and a non- refundable $100 fee. The Request for Bids package can be obtained from: Public Works Department City of Tustin 300 Centennial Way Tustin, California 92780 An optional pre-Bid conference will be held on December 16, 1999, at 2:00 p.m. at the Tustin Public Works Department, 300 Centennial Way, Tustin, California. Bids will be received until 4:30 p.m. on January 18, 2000, at which time such bids will be publicly read. Bids must be delivered to the City Clerk. For further informatiOn, contact the Public Works Department at 714/573-3150. December 1, 1999 City of Tustin CITY OF TUSTIN REQUEST FOR BIDS FOR INTEGRATED SOLID WASTE MANAGEMENT SERVICES Description Section I Section II Section III Section IV Section V TABLE OF CONTENTS Page Introduction 1 OVERVIEW OF THE REQUEST FOR BIDS. 1 PRE-BID CONFERENCE 2 BID ADMIN1STR.~TION 2 SUBMISSION OF BIDS 3 AWARD OF THE BID 4 SCHEDULE 4 Description of Current Conditions. 5 DESCRIPTION OF SERVICE AREA 5 CURRENT SERVICES 5 CURRENrr SERVICE DATA 6 BILLING PROCESS 6 CURRENT RATE5 6 AB 939 PLANS 6 Scope of Services 7 R.~,TE ADJUSTMENT METHOD 7 REFUSE COLLECTION 7 RECYCLABLE5 COLLECTION 9 YARD I~rASTE COLLECTION 10 SPECIAL SERVICES 11 AUTOMATED CART SPECIFICATIONS 12 CITY FEES 12 DISPOSAL, TRANSFER AND PROCESSING FACILITIES 13 OPEIL~TING FACILITIES 13 IMPLEMENrFATION PLAN 13 CUSTOMER SER\qCE AND BILLING 14 HAZARDOUS WASTE IvIANAGEMENrr COMPONENT · 14 EDUCATION ANrD PUBLIC AWARENESS 14 REPORTING 14 Bid Submission Requirements 15 RESPONSIBLE BIDDER INrFORMATION 15 R.~,TES PROPOSED 15 SUPPORTING COST AND OPEIL~TING DATA 15 FRANCHISE AGREEMENrr SIGNATURE PAGE 15 BUSINESS STRUCTURE 15 DESCRIPTION OF BIDDER'S EXPERIENCE 16 INFORMATION REGARDING PASt AND PENDING LITIGATION 16 KEY PEP,-qONNEL 16 FLNANCIAL LNrFORMATION 16 Bid Evaluations 18 RESPONSI\ ENE.,S 18 RESPONSIBILITY ' ' 18 AWARD 19 December 1, 1999 City of Turn CITY OF TUSTIN REQUEST FOR BIDS FOR INTEGRATED SOLID WASTE MANAGEMENT SERVICES LIST OF ATTACHMENTS Attachment 1: Attachment 2: Attachment 3: Attachment 4: Attachment 5: Attachment 6: Attachment 7: Attachment 8: Attachment 9: Existing Service Data Bid Outline Proposed Rates Supporting Costs and Operating Data Worksheets Anti-Collusion Affidavit and Notary's Certification Responsible Bidder Information Manufacturer's Certification of Cart Conformance Certificate of Insurance and Designation of Named Additional Insured Franchise Agreement December 1, 1999 City of Turn OVERVIEW OF THE REQUEST FOR BIDS The City of Tustin (City) is requesting bids from qualified solid waste companies to exclusively provide, for a period of seven ),ears, solid waste collection, transportation, reg,cling, processing, and disposal sen,ices for the City's residential, commercial, and roll-off box customers. A description of the City and the current services it receives from its current franchisee, Waste Management, Inc. (%~rMI) is included in Section II of this RFB. Existing service data provided bl), WMI and the City is included in Attachment 1. The services for which the City is seeking bids are summarized in Table 1 below and briefly described in Section 111 of this P~B. A more comprehensive description of the scope of services is found in Articles 4 and 5 of the Franchise A~eement, which is included as Attachment 9 of this RFB. Single-Family [ZYelling Unit (3 un/ts or less) Multi-Family Dwelling Units (4 units or more) Commercial & Industrial City Sendces Table 1 - Requested Sendces Automated and Manual Curbside Refuse Collection · Automated Curbside Recyclables Collection · Automated Curbside Yard Waste Collection · On-Call Bulky Item Pickup · Christmas Tree Collection and Recycling · Automated and Manual Curbside Refuse Collection · Automated Curbside Recyclables Collection · l~iixed Waste Processing of Multi-Family Accounts that Do Not Recycle · On-Call Bulky Item Pickup · Christmas Tree Collection and Recycling · Refuse Collection · Recyclables Collection · Yard Waste Collection · Permanent and Temporary Roll-Off Box Sen, ice · Mixed Waste Processing of all Commercial and Industrial Accounts that Do Not Recycle · Solid Waste Collection for City Facilities · Refuse Collection and Recycling for City-Sponsored Events · Abandoned Item Collection from Streets and Alleys December 1, 1999 Page 1 City of Turn Section IV of this P,d:B describes the required contents of the bid. The bid should be organized according to the outline shown in Attachment 2. In addition to the required contents described in Section IV, the bids must include the following forms: Proposed Rates in Attachment 3; Supporting Cost and Operating Data Worksheets must be included in Attachment 4; Anti-Collusion Affidavit and Notary Certification included in Attachment 5; Minimum Bidder Requirements form in Attachment 6; A copy of the cart manufacturer's ten (10)),ear warranty on the automated carts; and, Manufacturer's Certification of Cart Conformance form in Attachment 7. Executed sigrtature page of Franchise Ag-reement in Attachment 9. Failure to complete and submit the above forms and the other information required in Section IV shall be g-rounds to disqualify, a bid as non-responsive. Winning bidder will be required to submit insurance certificates in the format of Attachment 8 and required bonds x~dthin 10 days of Council action awarding contract. A current listing of bins at City facilities is provided in Exhibit 2 of the Franchise Ag-reement PRE-BID CONFERENCE A pre-bid conference will be held at the City of Tustin, City Hall, 300 Centennial Way on .December 16, 1999 at 2:00 p.m. Only written questions regarding this RFB (via fax or mail) will be accepted prior to and after the pre-bid conference. Both oral and written questions w/Il be accepted at the conference. As appropriate, answers will be provided at the conference. Written responses will be provided as soon as possible for all written questions received, and will be provided to every bidder attending the pre-bid conference. No questions will be accepted after (Date). Written responses will goverru Communications regarding this RFB should be done exclusively through the Public Wor'ks Department, which can be reached a t 714/573-3173 and by facsimile at 714/734-8991. BID ADMINISTRATION The City of Tustin shall have the right to perform, and each bidder must agee to cooperate with, an investigation and review of each bidder's ability to perform the work required. Such cooperation shall apply not only to the verification of the bidder's capability and experience in the provision of services, but also to the provision of any other component of work that may be required under this procurement. In order to objectively evaluate aH bids, the City has attempted to describe the desired sen, ices and the terms and conditions in the Franchise Agreement in a manner that will allow a reasonable level of comparability among the bids. Therefore, the City discourages, and may disqualify, bids that substantially deviate from the RFB. Bids that do not include the completed forms required herein and information required in Section IV shall be disqualified as. non-responsive. December 1, 1999 Page 2 City of Tustin The City reserves the fight to reject all bids, disqualify bids as non-responsive, waive non- material deviations from the P,,FB, and determine whether bidders are responsible. The City resen~es the right to issue addenda to the RFB, to modify the P,,FB, to modify the Franchise Ageement, or to withdraw the RFB. The City may request clarification or additional information from any of the bidders at any point in the RFB process. Bids must comply fully with the requirements detailed in this RFB. Required supporting 'documentation must be included as attachments and must be appropriately identified. The existing sen,ice information presented in Section II and Attachment 1 of this RFB is for information only and the bidder agees to indemnify and hold the Cit7 harmless for the accuracy of this data. All bidders should take whatever steps they believe are necessary to reasonably establish the actual existing sen'ice information when preparing their bids. SUBMISSION OF BIDS The Franchise A~eement containing the terms and conditions under which service will be provided (Attachment 9) is an integal part of this RFB. The Franchise Ageement includes information related to sen,ice standards, rate setting, bi/ling, reporting and other activities related to the performance of these sen,ices: Submission of a bid shah constitute acknowledg-ment and acceptance of all the terms and conditions contained in this RFB, and in the Franchise Ag-reement. The successful bidder will be . expected to enter a Franchise Ageement with the City without exceptions. Each and every term and condition of the bid shah be irrevocable until the City enters into a Franchise A~eement to perform the scope of sen:ices for the proposed rates according to those terms and conditions. Upon selection of its bid, the bidder is bound to provide evidence of the required insurance, execute the Franchise Ageement, and furnish a performance bond. The terms of this RFB and the bids~ are firm for a period of one hundred and eighty (180) days. Once submitted, responses to this RFB cannot be altered without the City's express written consent. The City reserves the right to reject any or all bids, and/or to waive any informality on a bid. This RFB is not to be construed as a contract of any kind. The City is not liable for any costs incurred by any potential bidder in the preparation of a response to this RFB. The City may withdraw or modify this request at any time. Bidders must submit three (3) bound copies plus one (1) unbound, camera-ready copy of the complete bid in a sealed package. The package should be clearly labeled: ATTEN~ON: CITY CLERK BID FOR INTEG~TED SOLID WASTE MANAGEMENrr SERVICES NAME OF BIDDER ADDRESS CONtrACT PERSON TELEPHO!NrE NUMBER FAX NUMBER The bid may be mailed, couriered, or hand delivered to the City of Tustin, 300 Centennial Wa),, Tustin, California, 92780. AH bids must be. received at the City of Tustin by 4:30 p.m., on January 18, 2000, City of Tustin time. Bids received after this time and date will be returned unopened.' Postmarks will not be accepted as proof of receipt. December 1, 1999 Page 3 City of Tustin AWARD OF THE BID To be considered, bids must be responsive (complete in all material respects), and the bidder must be responsible (see Attachment 6) and able to provide the City with an executed copy of the Certificate of Insurance and Desig'nation of Named Additional Insured included in Attachment $ prior to the Council awarding the Franchise. The contract will be awarded to the lowest responsible bidder based on the total rate revenue calculated in Attachment 3 as "Total Projected Annual Billings." The responsible bidder with the lowest Total Projected Annual Billings shall be awarded the franchise. SCHEDULE The procurement schedule is shown in Table 2 below. These dates are subject to change by the City. Table 2- Procurement Schedule December 6'h, 1999 Request for Bids available December 16'h, 1999 Pre-Bid Conference at 2:00 p.m. December 20,~, 1999 Last day to submit written questions January 18'h, 2000 Bids due to the City by 4:30 p.m. March 2000 Award Contract July 1" to Oct. 1", 2000 Start of sen,ices * * The existing contract expires June 30, 2000. However, it may be extended on a monthly basis until October 1", 2000 if the successful bidder requires additional time to procure equipment. December 1, 1999 Page 4 Oity of Tustin DESCRIPTION OF SERVICE AREA The City of Tustin is located in central Orange Count-v and encompasses an area of 11.02 square miles. The City is bounded on the south by the City of Irvine, on the west by the City of Santa .ama, on the north by the unincorporated portions of the County of Orange and the City of Orange, and on the east by unincorporated County territory and the City of Irvine. It is anticipated, but not assured, that by 2005 the development of the Marine Corp Air Station will include 3,151 new dwelling units, 2.1 million square feet of commerdal space and 2.0 million square feet of institutional/reCreational space. Bidders can obtain additional details on th/s development from the "MCAS Tustin EIS/EIR' available in the City Clerk's office. CURRENT SERVICES The current agreement with Waste Management, Inc. (WMI) expires on June 30, 2000, although it max, be extended until September 30, 2000 to allow additional time for the successful bidder to order equipment. The City is currently receiving the following sen,ices from WZ(I: Single Family Residential (3 units or less) · Once per week manual curbside refuse collection from cans provided by the residents. Multi-Family Residential (4 units or more) · Refuse collection manually from cans provided by the residents; and, · Refuse collection/rom front-loading bins. Commercial the existing franchise a~eement. senSce. · Refuse collection from front-loading bins; · Refuse collection manually/rom customer provided cans from a limited number of small volume customers; and, · Roll-off box collection is .part of the franchise per City ordinance, but it is not identified in The new franchise ag-reement will include roll-off box Special Services · On-call bulky item pickup; and, · Refuse collection at City sponsored events. Processing Facilities Used Nearly all mixed refuse collected is transported to Waste Management's material recovery facility, in Inq_ne for mixed waste processing. Certain pure cardboard loads are taken directly to a cardboard rec3,cler. Residue is disposed at the Bowerman and Brea-Olinda landfills. Franchise Fee The City currently requires a 2% franchise fee on g-ross receipts/rom customers billed by Waste Management No franchise fee is assessed on customers billed on the property tax rolls. The franchise fees remitted to the City for the last two fiscal years were 1997/98 - $106,857 and 1998/99 , $100,563, as shown in schedule 1G of Attachment 1. Franchise fees were lower in Fiscal ~998/99 due to a fourth quarter billing delay. December 1, 1999 Page 5 City of Tustin CURRENT SERVICE DATA The City has obtained from WMZI the service information shown in Attachments lA through 1G. As stated in Section I, the City neither warrants nor accepts responsibility for the accuracy of the information. It is the responsibili .ty of each bidder to undertake, at its sole cost, any verification of this informati6n necessary for it to submit a response to this RFB. BILLING PROCESS Currently the City bills all customers with can sendce on the Tax Roll. The Company bills commercial and multi-family bin and roll-off box customers. The Company also bills new can and cart customers added between Tax Roll billings. Under the Franchise A~eement being considered the City would bill all single family and multi- family (3 units and under) customers with carts or cans on the Tax Roll. Commercial and Multi- Family accounts (4 units or more) with cans or carts will continue to be billed on the Tax Roi1. The franchisee will bill customers directly for commercial and multi-family bin sen'ice and roll-off box sen:ice. See .krticle 5, Section 5.1.2 of the Franchise A~eement. CURRENT RATES Single family residents (three or fewer dwelling units) currently pay $12.74 per month per dwelling unit for curbside refuse collection sen-ice. Commerdal can customers currently pa), $13.20 per month. Rates for commercial bin customers are shown below in Table 3. Table 3 - Existing Monthly Rates for One Bin for Commercial and Multi-Family Bin Customers * 2 Cubic Yards 568.34 $111.28 $154.16 $197.12 $240.02 282.88 3 Cubic Yards $95.04 $153.26 $211.52 $267.63 $325.91 $384.14 4 Cubic Yards $107.98 $182.37 $256.24 $330.42 $404.62 $478.89 * Includes the 2% franchise fee. AB 939 PLANS The City is committed to fully complying with AB 939. Recent]y, the City has achieved a diversion rate of approximately 25%. The City's goal through this A~eement is to divert at least 50% by December 31" 2000. Copies of the City's Source Reduction and Recycling Element (SRRE) and its most recent AB 939 Annual Report are available from the Public Works Department for a nominal fee. December 1, 1999 Page 6 City of Tus~n The City is requesting bids for the sen, ices described below. A more comprehensive description of each of these services is found in the Franchise Agreement in Attachment 9. Although these sen:ices have been separately itemized, the City intends to enter into an agreement with only one firm for these sen, ices. Generally, bids should describe how the bidder would perform each of the sen'ices, including, but not limited to, collection methodologT, standard crew size, t,vpe and size of vehicles, and ,t3rpe and size of containers. The rates bid for each t-)~e of sen,ice should be included in the rate schedules in Attachment 3. In addition to the rates, bidders should calculate the estimated total annual revenue from each ~,lve of sen,ice. The total annual rate revenue from the proposed rates should be summarized in Attachment 3 ("Total Projected Annual Billings") and reconciled to the bidder's estimated revenue requirement (explained below) in Attachment 4. The supporting cost and operating data worksheets in Attachment 4 provide a format on which bidders must estimate their annual revenue requirement for providing all of the proposed sen'ices. In addition to the supporting cost worksheets, bidders must provide the operational statistics on wh.ich their estimated costs are based. The .operating statistics will be used to evaluate the reasonableness of the bidder's estimated revenue requirement. The bidder's estimated revenue requirement x~fill be used to evaluate the reasonableness of the proposed rates. This evaluation will be part of determining whether a bidder is responsible. RATE ADJUSTMENT M'ETHOD Rates for the first h,,,o years of the Franchise Agreement will be set based on the proposed rates in Attachment 3. Thereafter, the rates will be adjusted according to the computations descr/bed in Article 6, Section 6.3, of the Franchise Ag-reement in Attachment 9. The disposal component of the rates will be increased or decreased based on the gate rate at the Orange County landfill system, which is currently $22.00 per ton. REFUSE COLLECTION Single Family Dwelling Unit Refuse Collection Single family units currently receive manual collection from customer provided cans. The City desires to change to automated curbside collection using 96, 64 or 35-gallon carts in all areas of the City where automated sen, ice is operationally feasible (Article 4 Section 4.1.2 of the Franchise Agreement) The franchisee will purchase and provide the carts and be responsible for replacing lost, stolen or damaged carts. However, the City will own the carts at the end of the term of the Franchise Agreement, although the City. resen, es the right to have the contractor remove the carts at the end of the contract term at no charge to the City. December 1, 1999 Page 7 City of Tustin Multi-Family Dwelling Unit Re. fuse Collection - Automated Cart Service- Multi-Family Dwelling Units may receive cart sen,ice, where such collection is operationally feasible and permitted by the City. Whether or not road and par-king conditions permit sufficient access for collection of carts, and cart storage conditions at the properties shall determine feasibility (Article 4, Section 4.1.3). Commercial and Industrial Property Refitse Collection - Automated Cart Service Conmaerdal and industrial customers may request to receive automated cart sen,ice rather than bin sen'ice. The franchisee will be required to provide one or more 96-gallon carts (or other appropriate sizes) to each qualif-)fing small volume commerdal and industrial customer /or collection (Article 4, Section 4.1.4). Multi-Family, Commercial and IndustHaI Property Refuse Collection- Bin Service . The franchisee will be required to collect all refuse that has been placed m bras from all multi- (Article 4, Section 4.1.5). The franchisee will also be required to clean or replace all bins and industrial containers once per year at no charge. Additional cleanings at the request of the customer, or to prevent a nuisance caused by odors or vector harborage, will be provided at an added cost of $35 per cleaning. The existing commerdal and multi-family account and bin distribution is shown in Attachment lC. Monthly refuse rates should be proposed for each bin size and frequency of collection on Attachment 3. The annual refuse bin revenue should be calculated by multiplying the proposed monthly refuse rates by the estimated commerdaI and multi-family bin distribution and multip1}Sng by 12 months. Manual Can Service The franchisee will be required to continue manual can sen,ice to single family, multi-family, and commercial customers, where neither cart nor bin service is feasible (Article 4, Section 4.1.6). Attachment 3 assumes that the number of accounts/units that would continue to receive manual can service is the same as the current number of commercial can customers. The actual distribution of customers that will have cart sendce and those that will continue with manual can sen, ice is not .'known at this time. Temporary Bin and Roil-off Refuse Service The franchisee will be required to offer temporary bin and roil-off box sen, ice to all customers in the City for the collecti'on of refuse or construction and demolition waste (Art/cie 4, Section 4.1.7). For roll-off box sen, ice the franchisee will charge on a "haul plus disposal" basis. The charges to customers will be composed of: · A one-time delivery (or relocation) charge; · A load charge for each time the box is taken to the disposal site; and, December 1, 1999 Page 8 City of Tustin · '- · A disposal charge equal to the actual tonnage multiplied by the tipping fee paid. Additionally, the franchisee ma}, propose to charge a minimum load charge if the box is not emptied within a certain time period, and/or an ovenveight charge for customers that overload their roll-off boxes, and/or a separate load charge for hauling compactors. The number of roll-off loads and related tonnage in the City for the twelve months ended June 30, 1999 are shown in Attachment 1D. The proposed rates for roll-off box sen,ice should be included on Attachment 3. The annual revenue should be calculated by multip1)ing the proposed roll-off load rate times the number of roll-off loads plus disposal. For temporary bin sen,ice the franchisee will charge a single charge per load to include the cost of collection and disposal. The rate for temporary bin service ~ill be $50 per pickup for a three-cubic yard bin. City Facilities' Collection The franchisee will collect and dispose of all solid waste generated at facilities owned and/or operated by the City, billing the City according to approved rates (Article 4, Section 4.1.8). The current location of these public collections is described in Exhibit 2 of the Franchise Ageement, although the City may change the number of containers and their locations. The franchisee will provide recycling containers were feasible at City facilities and provide collection of such recvclables at no charge to the City. The franchisee will also provide a green waste roll-off box at ~e City yard at no charge. . Abandoned Item Collection The franchisee Will be required to collect abandoned item in the streets and alleys when notified by the City and to provide, at no charge, a roil-off box at the City yard for disposal of abandoned items collected by City crews (Article 4, Section 4.1.10). RECYCLABLES COLLECTION The franchisee will be required to provide recycling collection sen, ice, and to process or arrange for the processing of the collected materials, with the cost of processing the collected materials to be factored into the proposed service rates. Single Family Dwelling Unit Recycling The franchisee will be required to provide weekly curbside automated collection of recydables. Collection of recyclables should be on the same day as refuse collection service. The franchisee will be required to provide each single family customer (3 dwelling units or less) with a single 64 or 96-gallon recycling cart in which residents will place their commingled rec3,dables '(Article 4, Section 4.2.1). Customers that regularly fill their recy. cling cart may receive an additional cart at to additional charge. Bidders should be aware that, while they will be required to provide a recycling cart to all single family residential customers, there may be some customers who do not have space for the cart and may chose to return it. December 1, 1999 Page 9 City of Tus~n Multi-Family Dwelling Unit Recycling The f-ranch/see will be required to provide, at no additional charge, multi-family dwelling unit recycling collection (commingled recyclab]es) to all multi-family customers requesting it from the franchisee, regardless of the amount of revenue generated through other charges to customers or received from the sale of recyclables (Article 4, Section 4.2.2). Customers must be notified in ~viting at least once annually of the availability of recycling services. Commercial Recycling The franchisee will be required to provide, at no additional charge, recyciables collection and processing service to ail commercial customers requesting it from the franchisee, regardless of the amount of revenue generated through charges to customers or received from the sale of recyclables (Article 4, Sect/on 4.2.3). Customers must be not/fled in wr/ting at least once annually of the availability of recycling services. Construction Waste RecycIi~g The franchisee will be required to make reasonable efforts to prevent const-mction waste, suitable for recycling, from being taken to the landfill by transporting it to a facility where it will be processed for reuse (Article 4 Section 4.2.4). Mixed I4Zaste Recycling The franchisee will be required to transport all refuse from multi-fam/ly, commerdal and industrial customers that do notparticipate in separate recvclin~, ,~ collection ,vr°-°'ramso to a IVfRF for mixed waste processing to recover rec3,clables and yard waste. The franchisee will be required to ach/eve a min/mum d/version rate of 15% from such mixed waste processing (Article 4, Section 4.2.5). 'YARD WASTE COLLECTION Single Family Dwelling Unit Yard l~raste Collection The franchisee will be required to provide weekly curbside collection of yard waste on the same day as refuse collection from the City's single family customers. The franchisee will be required to provide each single family dwelling unit customer a single 96-gallon yard waste cart, or a 64-gallon cart for space constrained customers. Customers that reomalarly fill their yard waste cart may receive an additional cart at no extra charge (Article 4, Section 4.3.1). The franchisee shall also collect an unlimited number of tied bundles of yard waste set out next to the cart that meet the size restrictions of Section 4.3.1. However, the franchisee is not expected to divert yard waste placed in plastic bags outside the cart. Bidders should be aware that, while they will be required to provide a yard waste cart to ail single family residential customers, there may be some customers who do not have space for the cart and may chose to return it. Commercial & Industrial and Multi-Family Dwelling Unit Yard IYaste Collection The .franchisee will be required to provide automated yard waste collection to commerdal, industrial and multi-family customers who request it, at no additional charge. The franchisee December 1, 1999 Page 10 Gity of Tustin will be required to notify al1 of its commercial and multi-family refuse customers of the availability of yard waste collection sendce at least once each ),ear (Article 4, Section 4.a..~). Christmas Tree Collection and Recycling The franchisee will be required to annually collect and recycle all Christmas trees disposed of by single family and multi-family customers. The Christmas trees should be collected from curbside. Additionally, franchisee shall collect from roll-off boxes placed by the franchisee a t centralized drop-off sites as part of a separate two-day event. There will be no separate charge for Christmas tree collection; it will be included as part of the overall cost of sen,ice provided by the franchisee (Article 4, Section 4.3.3). End-Uses for Yard Waste The franchisee must provide end-uses for' yard waste that maximizes diversion credits for the City (Article 4, Section 4.3.4). Diversion Requirements The franchisee will be required to achieve a minimum of 50% diversion through transformation, recycling, yard waste collection, and mixed waste processing. Transformation shall not exceed 10% of the total waste stream. Refer to Article 4, Section 4.4 of the Franchise A~eement: SPECIAL SERVICES On-Call Bulky Item Pickup The franchisee will be required to provide on-call bulky item pickup sen'ice to single family and multi-family residential customers. Customers will be entitled to two pickups per calendar year, with a .maximum of three items per pickup, for no additional charge. The Company may charge a nominal charge for bulky item pickups that exceed the two pickup maximum. Customers will provide the franchisee with 48 hours notice and the items will be collected on the customer's regular collection day (Article 4 Section 4.1.9). Abandoned Item Collection Company shall collect abandoned items in the streets and alleys, and provide a roll-off box at the City yard for abandoned items co!lected by City crews, as described in Article 4, Section 4.1.10. City Sponsored Events . The franchisee will be required to provide solid waste and recycling collection service at the annual City-sponsored events as shown in Table 4. This will include providing containers to collect and dispose of all solid waste, and providing containers to collect source-separated recyclables. The franchisee vdll be required to provide these services at no additional cost to the City, the ratepayers, or other event sponsors (Article 4 Section 4.1.11). December 1, 1999 Page 11 City of Turn Table 4 -Annual City Sponsored Events 1) Tiller Days October 75,000 3 Days/14 hrs per day 2) Tree Lighting December 4,000 5 hour event 3) Communiv2, Yard Sale May 1,000 4 hour event 4) Street Fair/Chili Cook-Off June 12,000 10 hour event 5) Fourth of July Celebration July 22,000 6 hour event , AUTOMATED CART SPECIFICATIONS The franchisee shall provide the automated carts for collection of refuse, recycling and yard waste. The carts will be uniform in appearance and provided in three difference sizes. The cart sizes will be approximately 35, 64 and 96-gallon. The carts for each service (refuse, recycling and yard waste) will be different colors. 'The City will determine the colors of the carts. Refer to the cart desig'n requirements (Article 4, Section 4.5.3.1 of the Franchise A~eement) and cart performance standards (Article 4, Section 4.5.3.2 of the Franchise Ageement). The carts provided must have a minimum sen'ice life of ten (10)),ears. The bidders shall include a copy of the warranty for the carts against defects in materials and wor 'kmanship for a period of ten (10).),ears for all carts delivered under the Franchise A~eement from the date of delivery. The warranty shall be unconditional and non-prorated, providing the City with assurance of full replacement. CITY FEES Franchise Fees The franchisee will be required to pay franchise fees to the City equal to 2% of ~oss receipts from all amounts billed by the franchisee to the customers, excluding new cart and can customers temporarily billed by the franchisee prior to being added to the Tax Roll (Article 3, Section 3.1.1). Administrative Fee Upon execution of the Franchise A~eement, the franchisee will be required to remit to the City a one-time administrative fee of .$90,000 to reimburse the City for its costs of developing and awarding the franchise (Article 3, Section 3.1.2). City Business License The franchisee and any of its subcontractors will be required to maintain a City business license during the term of the contract (Article 3, Section 3.2). December 1, 1999 Page 12 City of Tustin - DISPOSAL, TRANSFER AND PROCESSING FACILITIES All bidders are required to use the Orange County landfill system at the current gate rate of $22.00 per ton for_ disposal in accordance with the waste disposal ag-reement between the Cie), and the Count3,, of Orange. The bidder must describe in its bid the specific Orange Count3, disposal site (and transfer station, if applic,able) it plans to use. The bidder should describe the processing facilities it plans to use to process the recyclable material and yard waste it collects. For each processing facility, please identi~, the following: · The name and location of the facility; · A statement regarding an3, relationship between the bidder and the facility ov~mer/operator (if any); Fadlity tonnage commitments, and a capadty guarantee (if proposed) for the term of the Franchise A~eement; if a capacity g-uarantee is not proposed, provide the tons per day currently received and available tonnage capadty per da),; · Init/al tipping tee per ton and, if the site is owned by a third party, the method of future fee adjustments, if knox,,m; -...'.- - · If the transfer and/or processing sen,ices are to be provided to the franchisee under an a~eement with the facility owner or operator, the terms and conditions of the must be sun'u-n~ed. A copy of the formal a~eement for sen;ices, should ag-reement be made, should be available to the City to review upon request. ., OPERATING FACILITIES Provide information about the operating facilities that you plan to use, including: · Location for equipment and personnel stagSng and arrangements for maintenance of equipment; and, · Office location for billing, customer service, public relations, and franchise administration. IMPLEMENTATION PLAN The City will accept a phase-in period for the new automated cart system in increments of 25 percent to be completed according to the schedule in Table 5. Service may be implemented sooner .but not later. .' Table 5- Phase in Schedule for Automated Collection Services Phase 1 - First 25% of dwelling units Within 90 days Phase 2 - Second 25% of dwelling units (50% total) Within 150 days Phase 3 - Third 25% of dwelling un/ts (75% total) Within 195 days Phase 4 - Full Implementation Within 240 days December 1, 1999 Page 13 City of Tus~n Provide an implementation plan, ta 'king into consideration the phase-in schedule in Table 5, describing ),our approach to facilitating a smooth transition to the new t3,pes of service, and (if applicable) to a new solid waste hauler. The bid must clearly demonstrate that ),our company has the ability to implement the sen,ices in accordance with the schedule sho~m above, including meeting equipment, personnel, administration, maintenance, and public education requirements. You should describe assumptions regarding the City's staff participation and (if appropriate) the current hauler's participation. CUSTOMER SERVICE AND BILLING Describe your procedures for dealing with customer service during the transition and term of the agreement and for performing customer billing. Describe procedures to satisfactorily respond to common customer complaints such as missed pick-ups, spills and litter resulting from collection, collection schedule changes, broken or rrdssing containers, improperly prepared set-outs, noise complaints, traffic obstruction during collection and safety around collection vehicles during operations. HAZARDOUS WASTE MANAGEMENT COMPONENT Descr/be procedures for identif3ing and handling hazardous waste disposed with the solid waste stream. The plan shall describe screening procedures, notification plan, and employee training prog-ram. EDUCATION AND PUBLIC AWARENESS The City, recoocmizes that effective public education is the key to implementing effective programs. Refer to Article 5, Section 5.3 of the Franchise Agreement- Education and Public Awareness- for specifics relating to the following requirements: · Initial Ma/ling - Explanation of the transition from the existing system to the new program; · Annual Brochure - information on available services; · Quarterly Billing Inserts/Notices- Continuing customer notification and explanation of programs and collection schedules; Corrective Action Notices- Notification to customers of inappropriate materials set out; and, · Education Video - A 15 minute education video on the new prog-rams. REPORTING Specific monthly, quarterly and annual reporting and record keeping requirements are described in Article 8 of the Franchise Agreement in Attachment 9. December 1, !999 Page 14 City of Tus~n In addition to providing information about the scope of services described in Section III, the following information must be organized according to the outline in Attachment 2. At the bev~ming of the Bid, include a title page, transmittal letter, table of contents, an executed anti-collusion affidavit and notary certification (Attachment 5), the responsible bidder in:formation form (Attachment 6), cart certification form (Attachment 7) and a copy of the cart manufacturer's warranty and a certified statement from the cart manufacturer that the carts conform to the desig-n specifications and performance requirements as shown in Article 4, Section 4.5.3. RESPONSIBLE BIDDER INFORMATION In order to be eli~ble to bid, all bidders must complete and return the Responsible Bidder Information from in Attachment 6. RATES PROPOSED Attachment 3 includes'proposed rate schedules. These must be completed in full in order for a bid to be considered. Bidders may be deemed unresponsive unless Attachment 3 is completed and submitted in its entirety. For presentation purposes, bidders may use their own computer spreadsheet prog-rams to replicate the forms and worksheets in Attachment 3. SUPPORTING COST AND OPERATING DATA Attachment 4 includes the supporting cost and operating data worksheets.. These must be completed in order for bidder's responsibility to be evaluated. A bid shall be deemed unresponsive unless Attachment 4 is completed ahd submitted, in its entirety. For presentation purposes, bidders may use their ov, m computer spreadsheet programs to replicate the forms and worksheets in Attachment 4. FRANCHISE AGREEMENT SIGNATURE PAGE Bidder must execute and return a signed copy of the sig'nature page of the Franchise Ag'reement in Attachment 9 in its current form indicating acceptance of all terms and conditions contained therein. No exceptions to the Franchise Agreement of any kind shall be accepted. BUSINESS STRUCTURE Identify the specific legal entity that would enter into the Franchise Agreement, and indicate whether it is an individual, a partnership, a corporation, or a joint venture. If the entity is a wholly owned subsidiary, describe in detail the relationship of the Subsidiary to its parent company. Indicate the number of years the entity has been organized and doing business under this legal structure (if other than an individual). Bidders should include all the names of owners/stockholders with greater than 10% of the company's equity,, all officers, and creditors owed a debt greater than 10% of the company's total assets. December 1, 1999 Page 15 City of Turn DESCRIPTION OF BIDDER'S EXPERIENCE Identif3, the names of all the public agencies in Orange County and Los Angeles County where the bidder currently provides sen,ice. Additionally, the bidder should submit a brief description of the bidder's experience providing solid waste sen'ices to municipal customers that qualifies it to perform the sen;ices being procured through this RFB. This description should be accompanied by a minimum of four detailed citations for current municipal customers with services most similar to those requested in this RFB, including: · The name of the jurisdiction; · The customers served (e.g. residential or commerdal); ' · The services performed (e.g. refuse collection, recyclable materials collection or yard waste collection); · Collection methods (e.g. manual, semi-automated or fully automated); · The name, address and telephone number of the jurisdiction representative responsible for administering the contract; · The number of households served, and annual tons collected and tons diverted; and, · A description of the bidder's historic participation in the jurisdiction's community events. Additionally, please provide at least two munidpal citations for service transitions from another hauling company, including a brief description of 'the old and new services, any obstacles encountered, and how those obstacles were overcome. INFORMATION REGARDING PAST AND PENDING LITIGATION Describe all cMl legal actions with government agencies now pending or which have occurred in the past ten )tears with potential liability or actual damages oo-reater than $50,000, and all criminal legal actions now pending or that have occurred in the past 10 years against: · The key personnel described below; · The entity submitting the bid; and, · Any parent or affiliated company for actions filed in the State of California. KEY PERSONNEL Identify and describe the qualifications and experience the City could expect of key personnel your company would assigrt to the City. Provide brief r~sum~s of the proposed management team members that will fill these described jobs (a maximum of one page per person)-. FINANCIAL INFORMATION Financial Statements Submit financial statements for the most recently completed fiscal year (preferably audited) for the entity that will guarantee the performance of the Franchise A~eement. All such statements are to be prepared in accordance with Generally Accepted Accounting Principles applied on a consistent basis including a statement by the chief financial officer of your December 1, 1999 Page 16 City of Tu~'n company that there has been no material adverse change in such condition or operations as reflected in the submitted balance sheet and income statements since the date on which the), were prepared. If desired by the bidder, the bidder may submit a single copy of its financial statements stamped "confidential" with a written request that it be returned to the bidder after the bid process is complete. The City will attempt to maintain the confidentiality of such a request, although certain summary information such as the bidder's annual revenues and certain financial ratios will be part of the evaluation, and therefore become part of the public record. Financing Plan Describe your plan for financing capital requirements in a format that describes the sources of required capital (e.g., banks, leasing companies, cash reserves, etc.) and uses of capital (property, truc'ks, equipment, containers, etc.). Attach such 'supporting documents that demonstrate ),our ability to implement the plan. Bidders should provide written documentation (e.g., letters from banks or leasing companies) demonstrating their ability to finance their capital requirements. December 1, 1999 Page 17 City of Tustin To determine whether the bid is responsive to the RFB and Franchise Agreement, the bids will be evaluated based on criteria in "A" below. To determine whether the bidder is responsible, the bids will be evaluated based on the criteria in "B" below. A. RESPONSIVENESS Completeness of the Bid · Completion and submittal of all bid forms and information required in Section W, · Extent and nature of exceptions (exceptions to material terms and conditions are non- responsive; no exceptions to the Franchise Ag-reement are permitted). B. RESPONSIBILITY Responsible bidder means a bidder who has demonstrated the attributes of trus,~vorthiness, as well as quaLity, fitness, capacity, and experience to satisfactorily perform the work required under the RFB and Franchise Agreement. The City will look at the following: Bidder's Experience · General Experience - Demonstrated experience providing similar sen,ices, including diversion pro,ams, to other jurisdictions. Experience of key personnel. · Jurisdiction Satisfaction- Satisfaction of bidder references with services received, including but not limited to, implementation, customer services, billing, payment of fees, and reporting. · Public Education - Bidder's public education experience and demonstrated approaches to achieving the AB 939 diversion goals. Technical Qualifications Implementation Plan - Reasonableness of implementation schedule and ability to meet deadlines (i.e., equipment procurement schedules, personnel available, and notice to customers). · Operations - Reasonableness of assumptions (e.g., number of routes). · Material Processing and Marketing - Realistic plan and guaranteed capacity for recyclable material processing, and yard waste processing. Financing Ability · Financing - Evidence that financing requirements will be fulfilled. Finandal Stability - Comparison of additional revenue from contract to company's current revenue stream. Liquidity of bidder based on its ratio of liabilities to assets. Demonstrated ability of bidder to obtain adequate insurance. December 1, 1999 Page 18 City of Tus-tin C. AWARD The franchise will be awarded to the lowest responsible bidder as determined by the City. Non- responsive bids will be disqualified. The lowest bid will be based on the total rate revenue calculated on Row 22 in Attachment 3 as "Total Projected Annual Billings." Responsibility will be evaluated as outlined above in B. If the City determines that a bidder is not responsible, the City shall notify the bidder in writing of the reasons for the determination and provide the bidder with the right to request a hearing before the City Council who's decision shall be final. The City Council may desig-nate a hearing officer or other body to hear the appeal. If a hearing officer or other body conducts the hearing, the officer or body shall make findings of fact and recommend a decision to the City Council. December 1, 1999 Page 19 City of Turn Attachment 1 Existing Service Data Contents lB. 1C. 1D. 1E. 1F. 1G. Single Family, Multi-Fam/ly and Commercial Billing Units as of June 30, 1999 Commercial and Multi-Fam21y Bin Distribution Tonnage Roll-Off and Bulky Item Activity Commodities Recovered by Type at the Material Recovery Facility Routes and R°ute Hours Schedule of Commercial Franchise Fees Iii _- _ - . _ · Z ro .,~z A achmen 2 Bid Outline The following is an outline that bidders should follow when completing their Bids: 1) General Requirements a) Title page b) Transmittal letter c) Table of contents d) Anti-Collusion Affidavit and Notary Certification e) Responsible Bidder Requirements form (Attachment 6) f) Copy of Cart Manufacturers Warranty g) Manufacturer's Certification of Cart Conformance (Attachment 7) h) Executed si~,~nature page from Franchise Agreement (part of Attachment 9) 2) Proposed Rates (Attachment 3) 3) Supporting Cost and Operating Data Wor 'ksheets (Attachment 4) 4) Bidder Overview a) Business structure b) Description of bidder's experience c) Information regarding past and pending litigation d) Key personnel e) Financial information (financial statements and financing plan) 5) PropoSed Services a) Refuse collection b) Recyclables collection c) Yard waste collection d) Special services e) Disposal, transfer and processing facilities f) Operatkng facilities g) Implementation plan h) Customer service and billing i) Hazardous waste management component j) Public education 6) Other Relevant Information December I, 1999 2-1 City of Tustin Attachment 3 Proposed Rates ~esidentlal. MulH-Family and Commercial Cart/Manua] Can Rates ' · ' : " Proposed ~timateci . . · Existing Monthly Annual · Row "i'. Service Monthly. Service. Billings Billings · Rate · Units * 1 Automated Cart 8,z"73,~ $ - $ 2 Manual Can 737 $ 3 'l-omi Cart/Can Biliings Y,51O $ - Commercial and Multi-Family Bin Rates Container Pickuvs ver Week Ross'. Size 1 2 3 ' [' 4 4 2 Cubic ~ aras { { 5 3 Cubic Yards 6 4 Cubic Yards Commercial and Multi-Fami}v Bin Distribution Matrix - Number of Bins · Container PicRu? Per ~'eek Tot, al - ~ 2 Cubic t~as ~ 2u ~ - 1 2 ilo 8 3 Cubic Yards ~3 ~2 ~ 1~ 132 62 1 A74 9 4 Cubic l~rds ~ S0 97 ~ 49 46 3~ Source: Waste Management, In:. The CiD' does not assume an), responsibiliD, for the accuracy of the reported information Qommercia! and Multi-Family Bin Billings Container Pickuvs ver Week 2'oral Row. , Size 1 2 3 4 5 6 11 2 Cubic t'ar~is $ $ - $ - $ $ - $ $ - 12 3 Cubic Yards - - - 13 4 Cubic Yards .... 14 'total Monthly Billings S - $ $ - $ $ $ - $ - 15 'l-otal Annuai Billings $ - $ $ - $ $ $ - $ - , ~911. Off Box Billin_rts Estimated Row Description Billing Unit Units per Proposed Annual Year Rat~ Billin,,l? 16 IPull Charge # of Pulls 3,002 $ - 17 Disposal/Processing Charge # of Tons 13,407 $ - 18 'l'otal Roll-Oii Box Billings $ - Summary of Pro!coted Annu~l Billin_es 19 Residential, Multi-?amily, Commercial Cart/Manual Can Billings $ - 20 Commercial and Multi-Family Bin Service Billings - 21 Roll-Off Box Billings - ~ Total Proiected Annual Billinl~s $ - ,, Specl.al Services Row Descriptions Rate ~ Temporary bm ~ervices - Per Puli, plus $5 per aay over 7 aays $ 50.00 24 Locking Bin - Cost per bin per month $ 5.00 ~ Bin Cleaning (in excess on one bin cleaning per year) - Each $ 35.00 · These unit estimates will be used/or purposes of calculating rate revenue and determining the proposer's overall cost. It assumes that all single family, duplex, and triplex units will receive automated cart service. Failure to complete and submit this form will deem the proposer's bid non-responsive. December 1, 1999 3-1 City of'i'u~'n · ; ; I ! ~ I ..- : ~ · . .: : ... .: ~ ..' :- .: -- ... _.. .'. ..- .: , , · . : .: .- : · . . ,~,.. .- : .- : - ._ ..- .- .- .. :- .: : : :' I i I f f ; ; · ~ .: : : .' · . ~.. .. .-__ ATTACI- /IENT 5 ANTI-COLLUSION AFFIDAVIT AND NOTARY'S CERTIFICATION Bidder as a part of this bid submits the following affidavit: The undersismed deponent, of lawful age, being duly sworn, upon his oath deposes and says: That he has lawful authority to execute the within and foregoing bid; that he has executed the same by subscribing 1-ds name hereto under oath for and on behalf of said bidder; that bidder has not directly or indirectly entered into any a~eement, express or implied, with any bidder or bidders, having for its object the controlling of the price or mount of such bid or bids, the lim/ting of the bids or bidders, the parceling or farming out to any bidder or bidders or other persons of any part of the contract or any part of the subject matter of the bid or bids or of the profits thereof, and that he has not and 4511 not divulge the sealed bid to any person whomsoever, except those having a partnership or other financial interest with him in said bid or bids, until after the said sealed bid or bids are opened.' Deponent further states that the bidder has not been a party to any collusion among bidders in restraint of freedom of competition; by ag-reement to make a bid at a fixed price or to refrain from submitting a bid; or with any City official or employee as to quantity, qualit3,, or price in the prospective contract; or in any discussions between bidders and any City official concerning exchange of money or other things of value for special consideration in the letting of a contract; that the bidder has not paid, given or donated or a~eed to pay, give or donate to any official, officer or employee of the City directly or indirectly, in the procuring of the award of contract pursuant to this bid. Executed under penalty of perjury on this day of ,~ at~ Subscribed and sworn to before me this SIGNED BY TITLE day of , , at My Commission expires: Notary Public Failure to complete and submit this form will deem the proposer's bid non-responsive. December 1, 1999 5-1 City of TustJn " ATTACHMENT 6 RESPONSIBLE BIDDER INFORMATION In order to be eli~ble to bid for the City's Integrated Solid Waste Management Sen'ices Agreement, potential bidders must provide all of the information described below. Please check the appropriate response to each item below, and attach documentation to this form supporting each response (e.g. names of agencies, population, dates of sen, ice, description of services provided, name of contact person at the agency and telephone number), and where the answer is "No", please provide detailed information about ),our experience providing the sendce. . . . . . . o o Requirement The bidder has previously proxdded exclusive residential refuse collection sen,ices to at least one public agency with a sen,ice area population of at least 30,000 in the past ten years. Yes No The bidder has previously proxdded exclusive commerdal refuse collection sen,ices to at least one public agency with a sen, ice area population of at least 30,000 in the past ten years. The bidder has previously provided fully automated residential refuse collection services (either refuse, recycling or yardwaste) to at least one city or county in the past ten years. The bidder has previously provided yardwaste collection sen, ices to at least one city or county in the past ten years. The bidder has previously provided recycling collection services to at least one city or county in the past ten years. The bidder has previously initiated new exclusive residential and commercial sen, ice in at least city or county as part of a transition from a previous service provider. The annual revenues.from the Tustin Contract (estimated at approximately $5 million per year at current rates) will be less than 33% of the 'bidder's existing annual revenue as reported for its most recently completed fiscal year. I have attached all supporting data required to explain the responses in this form. Failure to complete and submit this form will deem the proposer's bid non-responsive. December 1, 1999 6-1 City of Tustin ATTACHMENT 7 MANUFACTURER'S CERTIFICATION OF CART CONFORMANCE · Following are' the headings for the specific desigrt specifications and performance requirements for the automated carts to be obtained and used in the performance of the Franchise Agreement. Review the Franchise Agreement section referenced (Attachment 9) and check the space for "Yes" if the carts conform to the desig-n specification or performance requirement or "No" if the carts do not conform to the specification or requirement. · Cart Design Specifications Yes No 1. Capacity- Section 4.5.3.1.1 2. Cart Handles - Section 4.5.3.1.2 3. Cart Lid - Section 4.5.3.1.3 4. Foot-Hold - Section 4.5.3,1.4 5. Cart Colors - Section 4.5.3.1.5 6. ~rheel Desig-n and Axles Assembly- 4.5.3.1.6 7. Identification Markings - 4.5.3.1.7 8. Additional Parts - 4.5.3.1.8 9. Replacement Parts - 4.5.3.1.9 _ Cart PerformanCe Requirements 1. Minimum Service Life - 4.5.3.2.1 2. Cart Load Capacity- 4.5.3.2.2 3. Cart Durability - 4.5.3.2.3 4. Chemical Resistant - 4.5.3.2.4 5. Stability and Maneuverability- 4.5.3.2.5 6. Lid Performance - 4.5.3.2.6 7. Reparability - 4.5.3.2.7 I have read the sections of the Franchise Agreement referred to on the previous page and checked whether or not the carts included in the Bid for the City of Tustin Integ-rated SOlid Waste Management Sen,ices conform to the desig'n specifications and cart performance requirements contained therein. Sig'nature of Manufacturer's RepreSentative Name of Cart Manufacturer Title Date Failure to complete and submit this form will deem the proposer's bid non-responsive. December 1, 1999 7-1 City of Tustin ATTACHMENT 8 CERTIFICATION OF INSURANCE AND DESIGNATION OF NAMED ADDITIONAl, INSURED (all I'Y UP '1 US 1 IN CERTIFICATION OF INSUKANCE AND DESIGNATION OF NAAff. D ADDITION,id. INSURED NO MODIFICATIONS OR ADDITIONS MAY BE MADE TO THiS FORM TO: CITY OF 'JUSTIN ~ROJECT: P.O. Box 1089 Tusfin, CA 92781-1089 I COMPANIES AFFORDING COVER. AGE (MUST HAVE BEST'S KATING OF AT LEAST A. VII) N.~VlE AND ADD/LESS OF INSUKED CON'TR. ACTOK: ~COMPAN~' LETTER A: COMPANY LETI'ER B: COMPANY LETTER C: COMPANY L~-i i aR D: NAME A.ND ADDRESS OF INSUR.t,~CE AGENCY: COMPANY LETTER E: COMPANY LETTER F: , i tll$ c~rlllle$ rtla, tile policies o-' insul'ancc llsle~ ~lo~' 1]~¥'c o~l~ i$.~.lClO 1o Il'lc lnsuTen n~'nc adore. ~J'C II~ 10£CC ~' Ifll$ IlITtC, trial thc L.ID' oI 'Turin is named as an additional insured thereon as respects claims arising in connecnon with thc Pmj,'c~ named above and the: such insurane~ shall be vrima,'v ~nth resvem to any other insurance in fon:e procured bv City. Co. ~ ' Pohcy I Poi,cy { All L,m,t$ ,n Thousands Llr Ty~c o£ Insuran~e olim. Numbe, Effecaive Dal4Exniradon Dar General GV'NERAL LIABILITY [ ] Commercial rroas-c, omp,ops General Liabiliw. [ ] Oceurr~ Ba.~s ip~rs, a- ^ars injury [ ] Ownm"s Z: Contr~tor's Each Occurren~ S PrOleCliv¢ [ ] Brond Form Prop. Dam~e Fire Dm'n~je [ ] ,Explosion, Collapse. CAnv One Fire} Undergzound I'ttz~ds Medic~ Expens~ (Any One Person) ,$ Ab I OblO~lgL LIAIilLI 1 i [ ] AnyA"to IOSL $ [ ] All Owned Autos [ ] Scheduled Autos Bodily Injury [ ] Hired Autos fPer Person} [ ] Non-Owned Autos [ ] Garage Liabili~ Bodily Injury Provcrw EXCESS LIABILITY [ ] Umbrella Form EACH OCCUKRENCE AGGREGATE [ ] Olh~ Umbrella Form $ $ WOKKER'S COMPENSATION STATUTORY AND EMPLOYER'S LIABILITY $ E~;h $ Di~.ase-Poli~ Limil ~ Disease-l:-eh Emulov~ OTHER '"' D~riplion of Opemtions/].,ocalionsYVehi¢{eslSpe¢ia{ h~n$: gat:on Is hereby ~ssuecl lo the Ci~ of lustre as p~"t~ns tO thc terms of all ~orKe~'s Compcnsat:on lnsuran~4:. The issuing company will give thin)' (30) da3/s written nmiec m the City. o£ Tustin prior to modification or cancclimion. DATE ISSUED: Autnonz~:i KcT)resc~tmlv¢ of t~ aZ)Ove-n~rned insurance company(~) December 1, ~ 999 8-1 City of Tustin Attachment 9 Franchise Agreement FRANCHISE AGREEMENT BETWEEN CrrY oF TUSTIN FOR INTEGRATED SOLID WASTE M. ANAGEMENT SERVICES December 1, 1999 FRANCHISE AGREEMENT BETWEEN CITY OF TUSTIN AND FOR INTEGRATED SOLD WASTE lVL~_NAGEMENT SERVICES TABLE OF CONTENTS . . Page RECITALS ............................................................ · ......................... 1 ARTICLE 1 DEFLNITIONS 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 1.24 1.25 1.26 1.27 1.28 1.29 1.30 1.31 1.32 AFFILIATE ..................................................................................................................................... 3 AGREEMENT ................................................................................................................................... 4 BILLINGS ........................................................................................................................................ 4 BIN ................................................................................................................................................ 4 CAN ................................................................................................................................................ 4 CART .............................................................................................................................................. 4 COLLECT/COLLECTION .................................................................................................................... 5 COMMERCIAL AND INDUSTRIAL PROPERTY ........................................................................................5 COMPA.Nry ...................................................................................................................................... 5 COMPANY'S BID .............................................................................................................................. 5 COMPANY COMPENSATION ................................................................................................. ; ............. 5 CONSTRUCYION WASTE .................................................................................................................... 5 CONTAINqERS .............................................................................................................................. '.... 6 CUSTOMER ................................................................................................................... ; ................. 6 DISPOSAL ........................................................................................................................ : .............. 6 DISPOSAL SITE(S) ............................................................................................................................ 6 ENWIRONMENTAL LAWS .................................................................................................................. 6 FACILITY ........................................................................................................................................ 7 FRANCHISE ........................................................ ' ............................................................................. 7 FRANCHISE FEE .............................................................................................................................. 7 GROSS RECEIPTS .................................................................................................... : ........................ 7 HAZARDOUS SUBSTANCE ................................................................................................................. 7 HAZARDOUS WASTE ........................................................................................................................ HOUSEHOLD HAZARDOUS WASTE (HHW) ...~ ..................................................................................... 8 MATERIALS RECOVERY FACILITY (MR.F) .......................................................................................... 8 MIXED WASTE PROCESSING ............................................................................... : ............................. 8 MULTI-FAMILY DWELLING UNIT ................................................................... : .................................. 9 ORANGE COUNTY LANDFILL SYSTEM ............................................................................................... 9 OWNER. ........................................................................................................................................... 9 PERSON .......................................................................................................................................... 9 o. -. 1.33 1.34 1.35 1.36 1.37 1.38 1.39 1.40 1.41 1.42 1.43 1.44 1.45 PREMISES ........ ; ........................................................................................................................ 9 RATE YEAR RECYCLING .................................................................................................................................. 10 RECYCLABLE MATERIALS .............................................................................................................. 10 REFUSE ........................................................................................................................................ 10 RESIDENq"IAL PROPERTY ............................................................................................................... ! 0 ROLLOFF BOX ........ ~ ...................................................................................................................... 10 SINGLE FAMILY DX~ ELLING UNIT ....................................................................................... ............ 10 SOLID WASTE ................................... · ............................................................................................ 11 STATE .............................................................................. : ....................... 11 TRANSFORMATION ' " .................................. 1 l .YARD WASTE ................................................................................................................................ 11 ARTICLE '~ GtLa~N'T AND ACCEPTANCE OF FRANCHISE 2.1 GRANT AND ACCEPTANCE OF FRANCHISE 2.2 EXCLUSIVE NATUI~E OF FRANCHISE 2.3 EFFECTIVE DATE ........................... ii ............................................................................................. 12 12 2.4 TERN{ OF AGREEMENT ................. i .... 111111111111111111111111111111111111111111115111'51 .......................................... 13 2.6 DELEGATION OF AUTHORITY .................................................. 2.7 LIMITATIONS ON SCOPE OF FRANCHISE ........................... j .... i...iilJJi.i;iiljijij"j .................................. 13 13 2.8 CITY'S RIGHT TO DIRECT CHANGES 2. 8. I General .......................................................... 2.8.2 ....................................................................... 15 New Diversion Programs .................................................................................. , ....................... J 6 2.8.3 City's Right to Acquire Services ........ ~ .................................................. ]6 2.9 OWNERSHIP OF SOLID WASTE ........................................................................................................ 16 2.10 COMPANY STATUS ............................................................ I7 2.11 COMPANY AbTHORIZATION .................................... i ....... ..... 'i;..'iii 'i. .................................................. ..... ....... ...... ........................ ..... .. I7 2.12 ANNEXATIONS ................................................................. : ............................................................ 18 ARTICLE 3 .................................................................................. 19 F1L&NCI--IISE & ADMENISTIL4~TIVE FEE 3.1 'FRANCHISE AND ADMINISTRATIVE F~:~ .................................................................... 19 3.1.1 Franchise Fee Amount ....................... : ..................................................................................... 19 3.1.2 Administrative Fee ...... ~ ................................................................ 3.1.3 Time and Method of Payment ........................................... ' ..........................................]9 19 3.2 BUSINESS LICENSE ...................... 20 3.3 OTHER FEES .................................................................................................. .......................................................................................... ~ ...................................... 20 ARTICLE 4 .................................................................................. 21 DIRECT SERVICES ...................................... '"; ........................................................ 21 4.1 REFUSE COLLECTION SERVICES .............................................. 21 General ................................................................................................................................. 21 4.1.2 Single Family Dwelling Unit Refuse Collection - Automated Cart Service ............. ' ............................ 21 4.1.3 Multi-Famil~ Dwelling Unit Refuse Collection - Automated Cart Service .......................................... 22 4.1.4 Commercial and Industrial ProperO. Refuse Collection - Automated Cart Service ............................... 22 4.1.5 Muhi-Family, and Commercial and Industrial Refuse Collection - Bin Service 22 4.1.6 Manual Can Service.. ' .................................. 23 4.1.7 Temporary Bins and Rolloff Box Service ................................ ' ..................................... 23 4.1.8 Cio' Facilities' Collection ............... 4.1.9 On-Call BulLy Item Pickup ........................................: .............................................................. 24 4.1. l 0 AbarMoned hem Collection ................................................................................ ........... . ..... .. .... 24 4.1.11 Cio' Sponsored Events 24 4.2 RECYCLING SERVICES .................................................................................. ~ .... 25 4.2.1 Single Famih' Dwelling Unit Recycling .................................................. '. "..~.'"~ .....~ .... ~'"~'...~ 25 4.2.2 4.2.3 4.2.4 4.2.5 4.2~6 4.2.7 Multi-Family Dwelling Unit Re©'cling ........................................................................................ 25 Commercial Recycling ............................................................................................................. 25 Construction Waste Recycling ................................................................................................... 26 Mixed Waste Processing ........................................................................................................... 26 .Warning Notice ...................................................................................................................... 26 Markcting arm Sale of RecyclabIe Materials ................................................................................. 27 4.3 YARD WASTE PROGRAM ................................................................................................................ 27 4.3.1 Single Famih' Dwelling Unit Yard Waste Collection ...................................................................... 27 4.3.2 Commercial & Industrial and Multi-Family Dwelling Unit Yard Waste Collection. .............................. 27 4.3.3 Christmas Tree Collection Program ........................................................................................... 27 4.3.4 End Uses for Yard Waste .......................................................................................................... 28 4.4 DIVERSION REQUIREMENTS ........................................................................................................... 28 4.5 OPEtLa. T1ONS ................................................................................................................................. 28 4.5.1 4.5.2 4.5.3 4.5.3.1 4.5.3.1.1 4.5.3.1.2 4.5.3.1.3 4.5.3.1.4 4.5.3.1.5 4.5.3.1.6 4.5.3.1.7 4.5.3.1.8 4.5.3.1.9 4.5.3.2 4.5.3.2.1 4.5.3.2.2 4.5.3.2.3 4.5.3.2.4 4.5.3.2.5 4.5.3.2.6 4.5.3.2.7 4.5.3.3 4.5.3.4 4.5.4 4.5.5 4.5.6 4.5.7 4.5.8 4.5.9 4.5.10 4.5.11 4.6 4.7 4.8 4.9 4.10 4.11 4.12 Schedules .............................................................................................................................. 28 Vehicles ................................................................................................................................ 29 Containers ............................................................................................................................. 32 Can Design Requirements .................................................................................................... 32 Capacir3'. .......... ' 32 Can Handles ...................................................................................................................... 32 Cart Lid ............................................................................................................................ 32 Foot-Hold. ......................................................................................................................... 33 Cart Colors ........................................................................................................................ 33 Wheel Design and Axle Assembly. .......................................................................................... 34 Identification Markings ........................................................................................................ 34 Additional Pans. ' 35 Replacement Parts .............................................................................................................. 35 Cart Performance Requirements ...... ' 35 Minimum Service Life .......................................................................................................... 36 Can Load Capacity. ............................................................................................................ 36 Cart Durability. .................................................................................................................. 36 Chemical Resistant .............................................................................................................. 37 Stability and Maneuverability. ............................................................................................... 37 Lid Performance ................................................................................................................. 37 Reparabtltr) ....................................................................................................................... 38 Cart Ownership and Maintenance Responsibilities .................................................................... 38 Bins .................................................................................................................................. 38 Lirter Abatement ................................................................................................................. · ..... 39 Personnel .... ~ 40 Identification Required.. ' 40 Fees and Gratuities ................................................................................................................. 41 Non-Discrimination .................... ' .................................................................................. 41 Coordination With Street Sweeping Services ................................................................................ 41 Change in Collection Schedule ..................................................................................... ~ ............ 41 Report of Accumulation of Solid Waste; Unauthorized Dumping ' 42 TIMETABLE FOR ROLL-OUT OF RESIDENTIAL CARTS ........................................................................ 42 TRANSPORTATION OF REFUSE ........................................................................................................ 42 DISPOSAL OF REFUSE ..................................................................................................................... 43 STATUS OF DISPOSAL SITE ............................................................................................................. 43 .aNNUAL ROUTE AUDIT. ................................................................................................................. 43 SERVICE EXCEPTIONS; HAZARDOUS WASTENOTIFICATIONS ............................................................. 43' DISASTER PREPAREDNESS PLAN ................................................................ ' 44 ARTICLE 5 .................................................................................. 45 OTHER SERVICES .................................................................................................. 45 5.1SERVICES AND CUSTOMER BILLING ................................................................................................ 45 5.1.1 Service Description ................................................................................................................. 45 5.1.2 Billing ................................................................................................................................... 45 5.1.$ Review of BilIings ................................................................................................................... 47 5.2 CUSTOMER SERVICE ...................................................................................................................... 4'/ 5.2.1 Office Hours .......................................................................................................................... 47 5.2.2 Complaint Documentation ........................................................................................................ 48 5.2.$ Resolution of Customer Complaints ............................................................................................ 48 5.2.4 Government Liaison ................................................................................................................ 49 5.3 EDUCATION AND PUBLIC AWARENESS ............................................................................................ 49 5.5.1 General ................................................................................................................................. 49 5.3.2 CommuniO' Events. .............................................................................. ' .................................... 50 5.4 WASTE GENERATION/CHARACTERIZATION KII.IDIES ........................................................................ 51 ARTICLE 6' · ................................................................................. 52 COMPANY COMPENSATION AND RATES ................................................................... 52 6.1 · GENERAL. ..................................................................................................................................... 52 6.2 INITIAL RATES .............................................................................................................................. 52 6.3 SCHEDULE OF FUTURE ADJUSTMENTS ............................................................................................ 52 6.4 METHOD OF ADJUSTMENrI"S ............................................................................................................ 53 6.4.1 General. 6.4.2 Customers Billed By the Cio'. ......... :...: ...................................................................................... 53 6.4.3 Customers Billed By the Company. ............................................................................................. 54 6.4.4 RolIoff Box. .............................................................. : ............................................................. 55 6.5 EXTR. AOt~/NARY ?d)JUSTMENrTS.. 6.6 SUPPORTING INFORMATION ........................................................................................................... 56 6.7 GR.~d,,'TS... ..... o.--o ........... . ....... ..°....oo~.°.o ...... . ..... ° ........... o .............. .o.. ..... .°o..o....o., .... o.......°.. ............. · 56 ARTICLE 7 .................................................................................. 57 REVIEW OF SERVICES/UN'I) PERFORM.M'qCE .............................................................. 57 7.1 PERFORMANCE HEARING ............................................................................................................... 57 ARTICLE 8 ................... , .............................................................. 59 RECORDS, REPORTS AND ENFORMATION REQUIREMENTS · ......................................... 59 8.1 GENERAL.'. ................................................................................................................................... 59 8.2 RECORDS ..................................................................................................................................... 59 8.2.1 General ........................................................... ' ...................................................................... 59 8.2.2 Financial Records ................................................................................................................... 60 8.2.3 Solid Waste, Reo, cling, and Yard Waste Service Records ......................................... ~ ...................... 60 8.2.4 CERCL4 Defense Records ........................................................................................................ 60 8.2.5 Disposal Records .................................................................................................................... 61 8.2.6 Other Programs' Records ........................................................................................................ 61 8.2. 7 Cost of Audit ................ ' ........... ' ............................................................................................... 61 8.2.8 Payments and Refunds ............................................................................................................. 61 8.3 REPORTS ...................................................................................................................................... 62 8.3.1 Report Formats and Schedule ................................................................................................. :.. 62 8.3.2 MonthO, Reports ..................................................................................................................... 63 8.3.3 Quarterly Reports ................................................................................................................... 63 8.3.4 Annual Report ........................................................................................................................ 63 8.3.5 AB 939 Reports ....................................................................................................................... 64 8.3.6 Financial Report ..................................................................................................................... 64 8.4 ADVERSE INFORMATION ................................................................................................................65 8.5 RIGHT TO INSPECT RECORDS .................................................... : .................................................... 65 ARTICLE 9 .................................................................................. 66 INDEMNIlqCATION, INSURANCE AND BOND ............................................................. 66 9.1 INDEMNIFICATION ......................................................................................................................... 66 9.2 HAZARDOUS SUBSTANCES INDEMNIFICATION ................................................................................. 67 9.3 AB 939 INDEMNIFICATION ............................................................................................................. 68 9.4INSURANCE. .................................................................................................................................. 68 9.5FAITHFUL PERFORMANCE BOND .................................................................................................... 73 9.6FORFEITURE OF PERFORMANCE BOND ............................................................................................ 73 9.6.1 Partial Forfeiture .................................................................................................................... 73 9.6.2 Full Forfeiture .................................................. 73 ARTICLE 10 ................................................................................. 74 CITY'S RIGHT TO PERFORM SERVICE ...................................................................... 74 10.1 GENERAL. .................................. , ......... ' ......................................................................................... 74 10.2 10.3 10.4 10.5 10.6 TEMPORARY POSSESSION OF THE COMPANY'S PROPERTY ................................................................ 75 BILLING AND COMPENSATION TO THE CITY DURING THE CITY'S POSSESSION .................................... 75 CITY'S RIGI-tT TO RELINQUISH POSSESSION .............................................................. ' ....................... 76 CITY'S POSSESSION NOT A TAKING ...... ........................................................................................... 76 DURATION OF TIlE CITY'S POSSESSION ............................................................................................ 76 ARTICLE 11 ................................................................................. 77 DEFAULT, REMEDI1E-S AND LIQUIDATED DA.MAGES .................................................... 77 11.1 11.2 11.3 11.4 11.5 11.6 EXTENTS OF DEFAULT ..................................................................................................................... 77 RIGHT TO TERMINATE UPON DEFAULT ............................................................................................ 79 LIQUIDATED DAMAGES ........ : ........................................................................................................ 79 EXCUSE FROM PERFORMANCE ....................................................................................................... 83 .~RB ITRATI ON ............................................................................................................................... 84 ASSURANCE OF PERFORMANCE ...................................................................................................... 85 ARTICLE 12 .......................................... ~ ...................................... 86 OTHER AGREEMENTS OF THE PARTIES ................................................................... 86 12.1 RELATIONSHIP OF PARTIES ............................................................................................................ 86 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 12.10 12.11 12.12 12.13 12.14 12.15 12.16 12.17 12.18 12.19 12.20 12.21 12.22 12.23 COMPLIANCE W'ITH LAW ................................................................................................................ 86 GOVERNING LAW .......................................................................................................................... 86 JURISDICTION ............................................................................................................................... 87 ASSIGNMENT ................................................................................................................................ 87 A. FFILIATED COMPANIES ................................................................................................................ 89 CONTRACTING OR SUBCONTRACTING ............................................................................................. 89 BIN'DING ON ASSIGNS .................................................................................................................... 90 TRANSITION TO THE NEXT COMPAN~ ............................................................................................. 90 PARTIES IN IN'I'EREST. ................................................................................................................ 90 WAIVER. .................................................................................................................... : .............. 90 THE COMPANY'S INVESTIGATION. ............................................................................................... 90 CONDEMNATION ....................................................................................................................... 90 NOTICE. .................................................................................................................................... 91 REPRESENTATIVES OF THE PARTIES ............................................................................................ 91 CITY FREE TO NEGOTIATE WITH THIRD PARTIES .......................................................................... 92 COMPLIANCE WITH MUNICIPAL CODE ......................................................................................... 92 PRIVACY .................................................................................................................................. 92 COOPERATION FOLLOWING'TERMINATION ................................................................................. 93 COMPLIANCE WITH IMMIGRATION LAWS .......................................................... 2 ......................... 93 PROPRIETARY INFORMATION, PUBLIC RECORDS ......................................................................... 93 GUARANTEE OF CONTRACTOR'S PERFORMANCE ........................................................................... 93 AT'I'ORNrEY' S FEES ..................................................................................................................... 93 ARTICLE 13 ................................................................................. 95 MISCELLANEOUS AGREEMENTS ............................................................................. 95 13.1 ENTIRE AGREEMENT ..................................................................................................................... 95 13.2 SECTION HEADINGS ........................................... ' ............................................................................ 95 13.3 REFERENCES TO LAWS AND OTHER AGREEMENTS ........................................................................... 95 13.4 INTERPRETATION ................................................................................................................... '. ...... 95 13.5 AGREEMENT. 95 13.6 SEVERABILITY. ............................................................................................................................. 96 13.7 EXHIBITS ...................................................................................................................................... 96 13.8 NON-WAIVER PROVISION .............................................................................................................. 96 Exhibits 1. Company's Bid 2. Collection Services From City Facilities 3. Public Education Plan 4. Initial Rates 5. Rate Adjustment Formula 6. Corporate Guarantee 7. Faithful Performance Bond 8. Notary Certification RECITALS This Franchise A~eement (Agreement) is entered into this and between the City of Tustin (City) and __ da), of ., 2000, by (Company. IVI-IE~AS, the Legislature of the State of California, by enactment of the California Integated Waste Management Act of 1989 ("AB 939") (California Public Resources Code Section 40000 et seq. ), has declared that it is in the public interest to authorize and ~'equire local agencies to make adequate provisions for solid waste handling within their jurisdictions to meet the goals and requirements of AB 939; and, ISq-IEREAS, pursuant to the AB 939, the City is required to implement its Source Reduction and Recycling Element (SRRE) in order to divert 50 percent of its solid waste from landfill disposal by the ),ear 2000, and; ' ' IVI-IEREAS, pursuant to California Public Resources Code Section 40059(a)(2), the City of Tustin haS determined that the public health, safety, and well-being require that an exclusive franchise be awarded to a qualified company for the cOllection, . transportation, recycling, processing, and disposal of solid waste and other services to meet the goals and requirements of AB 939; and, WHEREAS, the current solid waste franchise agreement will expire on June 30th, 2000; and, 1¥I-IEREAS, in response to a Request for Bids dated, the Company has submitted a Bid to the City dated , (included as Exhibit 1) and the City has determined that the Company is the lowest responsible bidder; and WHEREAS, the Company agrees to and acknowledges that it shall properly dispose of ali solid waste collected in the City pursuant to tkis A~eement; and WHEREAS, the Cit-y and the Company (Parties) hereto desire to enter into th.is Ageement, NOI¥, THEREFORE, in consideration of the premises above stated and the terms, conditions, covenants and agreements contained herein, the Parties do hereby agree as follows: ARTICLE 1 DEFINITIONS 1.1 Whenever any term used in this Ag-reement has been defined by the provisions of Section 4311 of the Tustin City Code or by Division 30, Part 1, Chapter 2 of the California Public Resources Code, the definitions in the Municipal Code or the Public Resources Code shall apply unless the term is otherwise defined in this Ag-reement, in which case this Agreement shah control. Except as provided in Article 1, words beginning with lower case letters are being used with their common ordinary meanings, not as defined terms. Otherwise, the following capitalized words and terms shah have the following meanings: AB 939 "AB 939" means the California Integ-rated Waste Management Act of 1989 (California . Public ResoUrces Code Section 40000 et seq.), as it may be amended from time to time. 1.2 Affiliate "Affiliate" means all businesses (including corporations, limited and general partnerships and sole proprietorships) which are directly or indirectly related to the Company by virtue of direct or indirect ownership interest or common management shall be deemed to be "Affiliated with" the Company and included within the term "Affihates" as used herein. An Affiliate shall include a business in which the Company owns a direct or indirect o,amership interest, a business which has a direct or indirect ownership interest in the COmpany and/or a business which is also owned, controlled 'or managed by any business or individual which has a direct or indirect ownership interest in the Comp.any. For purposes of determining whether an indirect owners?dp interest exists, the constructive owmership provisions of Section 318(a) of the Internal . Revenue Code of 1986, as in effect on the date of this Agreement, shall apply; provided, however, that (i) "ten percent (10%)" shah be substituted for "fifty percent (50%)" in Section 318(a)(2)(C) and. in Section 318(a)(3)(C) thereof; and (ii) Section 318(a)(5)(C) shah be disregarded. For purposes of determining ownership under this paragraph and constructive or indirect ownership under Section 318(a), ownership interest of less than ten percent (10%) shall be disregarded and percentage interests shah be determined on 1.3 1.4 1.5 1.6 1.7 1.8 the basis of the percentage of voting interest or value which the ownership interest represents, whichever is greater. Agreement "Agreement" means this Franchise Agreement bem,een the City and the Company for the Collection, transportation, Recycling, processing and Disposal of Solid Waste, and other services related to meeting the goals and requirements of AB 939, including all exhibits and attachments, and any amendments thereto. Billings "Billings" means any and all statements of charges for services rendered, howsoever made, described or desig'nated by the City or the Company, or'made by others for the City or the Company, to persons responsible for arranging for solid Waste removal. Bin "Bin" means a metal container With hing-~d lids and Wheels serviced by a front-end loading truck with a capacity of 1.5 to 8 cubic yards. C2n "Can" means a Solid Waste receptacle provided by the Customer and sea, iced by manual Collection. Cart "Cart" means a plastic container with a hinged lid and wheels serviced by an automated or semi-automated side-loading truck with a capacity of no less that 35 and no greater than 101 gallons. City "City" means the City of Tustin, a municipal corporation, and all the territory lying within the municipal boundaries of the City as presently existing or as such boundaries may be modified during the term of this Agreement. 1.9 Collect/Collection 1.10 1.11 1.12 1.13 1.14 "Collect" or "Collection" means to take physical possession, transport, and remove Solid Waste within and from the City. Commercial and Industrial Property "Commercial and Industrial Property" means property upon which business activity is conducted, including but not Limited to retail sales, services, wholesale operations, manufacturing and industrial operations, but excluding businesses conducted upon Residential Property wh/ch are permitted under applicable zordng reg-ulations and are not the primary use of the property. Company "Company" means , a organized and operating under the laws of the State of Calfforrfia and its officers, directors, employees, agents, companies and Subcon~act0rs. . ~ _ -_ _. ~ Company's Bid "Company's Bid" means the Bid submitted by the Company to the City on 1999 in response to a Request for Bids dated ,1999. The Company's Bid is attached as Exhibit 1 and incorporated into this Ag-reement by reference. Company Compensation "Company Compensation" means the revenue received by the Company from Billings in return for providing sen, ices in accordance with this Ag-reement and any amendments to this Agreement. Construction Waste "Construction Waste" means used or discarded construction materials removed from a Premises during the construction of a structure. 1.15 Containers .. ... 1.16 1.17 1.15 1.19 "Containers" means any and all types of Solid Waste receptacles, inCluding Cans, Carts, Bins, R°lloff Boxes, and receptacles provided by customers. Customer "Customer" means the Person having the care and control of any premises in the City who receives refuse collection service from the Company. Disposal "Disposal" means the ultimate disposition of Solid Waste collected by the Company at a landfill in full reg'ulatory compliance. Disposal Site(s) "Disposal Site(s)" mean the Solid Waste handling facility or facilities utilized for the ultimate Disposal of'Solid Waste Collected by the Company. The Orange County Landfill System shall be the desig-nated Disposal Site as of the effective date of this Ag-reement. Environmental Laws ~'Environmental Laws" means all federal and state statutes, county, local and the City ordinances concerning public health, safety and the environment including, by way of example and not limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC §9601 et seq.; the Resource Conservation and Recovery Act, 42 USC §6902 et seq.; the Federal Clean Water Act, 33 USC §1251 et seq.; the Toxic Substances Control Act, 15 USC §1601 et seq.; the Occupational Safety and Health Act, 29 USC §651 et seq.; the California Hazardous Waste Control Act, California Health and Safety Code §25100 et seq.; the California Toxic Substances Control Act, California Health and Safety Code §25300 et seq.; the porter-Colog'ne Water Quality Control Act, California Water Code §13000 et seq.; the Safe Drinking Water and Toxic Enforcement Act, California Health and Safety Code §25249.5 et seq.; as currently in force or as hereafter amended, and all rules and regulations promulgated thereunder. 1.20 Facility "Facility" means any plant or site, owned or leased and maintained, operated or used by the Company for purposes of performing under this Agreement. 1.21 Franchise "Franchise" means the exclusive right granted by the City to provide Solid Waste services within the City. 1.22 Franchise Fee "Franchise Fee" means the fee paid by the Company to the City, or retained by the City from residential service fees remitted to the City, for the right to hold the Franchise granted by this Agreement. 1.23 Gross Receipts "Gross Receipts" means any and all revenues, receipts, or compensation in any form received by the Company or its subsidiaries, parent companies or other Affiliates of the Company, for the Collection and transportation of Solid Waste pursuant to this Ageement, in accordance with Generally Accepted Accounting Principles (GAAP), including, but not limited to, monthly customer fees for Collection of Solid Waste, without subtracting Franchise Fees or any Other cost of doing business. Sales revenue from the sale of Recyclable Material is excluded from goss receipts for purposes of calculating Franchise Fees. 1.24 Hazardous Substance "Hazardous Substance" shall mean any of the following: (a) any substances defined, reg-ulated or listed (directly or by reference) as "Hazardous Substances", "hazardous materials", "Hazardous Wastes", "toxic waste", "pollutant" or "toxic substances" or similarly identified as hazardous to human health or the environment, in or pursuant to (i) the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC ~9601 et seq.(CERCLA); (ii) the Hazardous Materials Transportation Act, 49 USC §1802, et seq.; (iii) the Resource Conservation and Recovery Act, 42 USC ~6901 et seq.; (iv) the Clean Water Act, 33 USC §1251 et seq.; (v) California Health and Safety Code §§25115-25117, 25249.8, 25281, and 25316; (vi) the Clean Air Act, 42 USC §7901 et -7- d3ycC'/'Ls~h 1.25 1.26 1.27 1.28 seq.; or (vii) California Water Code §13050; (b) any amendments, rules or regulations promulgated thereunder to such enumerated statutes or acts currently existing or hereafter enacted; and (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 biphenyl's ("PCBs"), petroleum, natural gas and synthetic fuel products, and by-products. Hazardous Waste "Hazardous Waste" means all substances defined as Hazardous Waste, acutely Hazardous Waste, or extremely Hazardous Waste by the State of California in Health and Safety Code ~25110.02, §25115, and §25117 or in the future amendments to or recodifications of such statutes or identified and listed as Hazardous Waste by the US Envirorunental 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 reg-ulations promulgated thereunder. _ . Household Hazardous Waste (HHW) "Household Hazardous Waste" means Hazardous Waste generated at residential Premises. Materials Recovery Facility (MRF) "Materials Recovery Facility" means a permitted Solid Waste facility where Solid Wastes or Recyclable Materials are sorted or separated for the purposes of Recycling, processing or composting. Mixed Waste Processing "Mixed Waste Processing" means the separation and sorting of recyclables and other recoverable materials from refuse at a MR_F where commingled loads of solid waste are processed. 1.29 Multi-Family Dwelling Unit 1.30 "Multi-Family Dwelling Unit" means any Premises consisting of four (4) or more residential units per parcel (not including hotels or motels), irrespective of whether · residence therein is transient, temporary or permanent. Orange County Landfill System "Orange Count3, Landfill System" means an), Landfill o~med or operated by the Count), of Orange, currently including Brea Olinda, Frank R. Bowerman, or Prima Deshecha. 1.31 Owner 1.32 "Owner" means the Person holding the legal title to the real property constituting the Premises to which Solid Waste Collection sen;ice is to be provided under this A~eement or the person holding legal title to the Disposal Site, depending upon the context used in this Agreement. _ Person "Person" means any individual, firm, association, organization, partnership, corporation, business trust, joint venture, the United States, the State of California, the County of Orange, town, city, or special purpose district. 1.33 Premises "Premises" means any land, or building in the City where Solid Waste is generated or accumulated. 1.34 Putrescible Waste "Putrescible Waste" means wastes that are capable of being decomposed by micro- organisms with sufficient rapidity as to cause nuisances because of odors, gases, or other offensive conditions. - 1.35 Rate Year 1.36 "Rate Year" means the twelve month period from of the Agreement: to , for each ),ear Recycling "Recycling" means any process by which materials which would otherwise become Solid Waste are collected (source-separated, co-mingled, or as "mixed waste"), separated and/or processed and returned to the economic mainstream in the form of raw materials or products or materials which are otherwise salvaged or recovered for reuse. 1.37 1.39 Recyclable Materials "Recyclable Materials" means residential, commercial or industrial Source Separated by- products of some potential economic value, set aside, handled, packaged, or offered for Collection in a manner different from Refuse. Refuse "Refuse" means putrescible and non-putrescible Solid Waste or debris, except sewage, whether combustible or non-combustible. Residential Property "Residential Property" means property used for residential purposes including Single- family and Multi-family Dwelling Units, irrespective of whether such dwelling units are rental units or are owner-occupied. 1.40 Rolloff Box "Rolloff Box" means an open-top metal container serviced by a rolloff truck with a capacity of 10 to 50 cubic yards. 1.41 Single Family Dwelling Unit "Single Family Dwelling Unit" means each Premises used for or designated as a single family residential dwelling, including each unit of a condominium project, duplex, triplex, townhouse, apartment building, or mobile home park in which each premises receives individual Solid Waste Collection sendce using Cans or Carts and consists of three (3) units or less per legal parcel.. 1.42 Solid Waste "Solid Waste" means all putrescible and non-putrescible residential Refuse, Recyclable Material, and Yard Waste, and as otherwise defined in Public Resources Code §40191. Any material that a Customer pays to be hauled away s~all be defined to be Solid Waste and not a Recyclable Material. 1.43 State "State" means the State of California. 1.44 Transformation "Transformation'' means incineration, pyrolysis, distillation, gasification, or biolo~cal conversion other than cOmposting. "Transformation" does not include composting. 1.45 Yard Waste "Yard Waste" means leaves, grass, weeds, and wood materials from trees and shrubs (not more than six (6) inches in diameter or 48 inches in length) and similar materials generated at the Premises. ~1, I9~ -11- CIydTu~h ARTICLE 2 GRANT AND ACCEPTANCE OF FRANCHISE 2.1 Grant and Acceptance of Franchise 2.2 Subject to the terms and conditions of this Ag-reement, the City hereby grants to the Company a Franchise to Collect, transfer, transport, recycle, process, and dispose of Solid Waste accumulating in the City that is required to be accumulated and offered for Collection to the Company in accordance with this Agreement. The Company hereby accepts the Franchise on the terms and conditions set forth in this A~eement. Exclusive Nature of Franchise 2.3 During the term of this Agreement, except as otherwise provided in Section 2.7 below, or as may otherwise be provided by federal or state law, the rights granted to the Company under this A~eement shall be exclusive to the Company. The City will not let any contract to, or enter into any agreement with, any other Person for the performance of the services herein required to be performed by the Company. The City shall protect the Company's exclusive rights by proper ordinances, and by reasonable enforcement of those ordinances. Should the City be required to take admirdstrative, law enforcement, or other legal action against any Person that infringes on the Company's exclusive rights, the Company shall reimburse the City for its reasonable administrative; law enforcement, or other legal costs related to any such action. Nothing herein shah preclude Company from taking such legal action against third parties as it deems appropriate to protect the exclusive nature of its Franchise. Effective Date The effective date of this Agreement shall be ("effective date"). o De:azl~ 1,1~,~ -12- ~y~Tts~h '-'. 2.zl Term of Agreement 2.5 2.6 2.7 The term of this Ag-reement shall be seven (7) years commencing at midnight ., 2000, and expiring at midnight ,2007, with no extensions permitted. Conditions to Effectiveness of Agreement The obligation of the City to permit this Agreement to become effective and to perform its undertakings provided for in this Agreement is subject to the satisfac~on of each and all of the conditions set out below, each of which may be waived in whole or in part by the Cit3,. a) Accuracy of Representations. Representations and warranties made by the Company throughout this Agreement are accurate, true and correct on and as of the effective date of this A~eement. b) c) Absence of Litigation. There is no litigation pending in any court challenging the award of this Franchise to the Company or the execution of this Agreement or seeking to restrain or enjoin its performance. Furnishing of Insurance and Bonds~ The Company has furnished evidence of the insurance and bonds required by Article 9. a) Effectiveness of the City Council Action. The City's ReSolution approving this Ag-reement shall have become effective pursuant to California law prior to the effective date of this Agreement. Delegation of Authority · The administration of this Agreement by the City shah be under the supervision and direction of the Public Works Department, and the actions specified in this Agreement, unless otherwise stated, shall be taken by Public Works Director or the Director's designee. Limitations on Scope of Franchise The Franchise ~anted to the Company shall be exclusive except as to the categories of Solid Waste listed in this Section 2.7. The granting of this Franchise shah not preclude the categories of Solid Waste listed below from being delivered to and Collected and transported by others provided that nothing in this Agreement is intended to or shall be construed to excuse any Person from obtaining any authorization from the City which is otheva,ise required by law: a) Recyclable Materials source separated from Solid ¼Taste by the Customer and for which Customer sells or is otherwise compensated by other Persons in a manner resulting in a net payment to the Customer; b) Solid Waste, including Recyclable Materials and Yard Waste, which is removed from any Premises by the Customer, and which is transported personally by the Customer of such Premises (or by his or her full-t/me employees) to a processing or Disposal Facility; c) Recyclable Materials and Yard Waste wh_ich are source separated at any Premises by the Customer and donated to youth, c/vic, or charitable organ/zations; Containers delivered for Recycling under the California Beverage Container Rec3,cling Litter Reduction Act, Section 14500, et. seq., California Public Resources Code; e) Yard Waste removed from a Premises by a gardening, landscaping, or tree -trimming Company utilizing its o~m equipment as an incidental part of a total service offered by the .company rather than as a hauling service; Construction Waste that is incidentally removed by a duly licensed construction or demolition company or as part of a total service offered by said licensed company or by the City, where the licensed company utilizes its own equipment; g). Animal waste and remains from slaughterhOuse or butcher shops for use as tallow; .. h) By-products of sewage treatment, including sludge, sludge ash, grit and screenings; Hazardous Waste and radioactive waste, regardless of its source; and, 2.8 The casual or emergency collection, removal, disposal or diversion of Solid Waste by the City through the City officers or employees in the normal course of their employment. The Company ac'knowledges and agrees that the City may permit other Persons besides the Company to Collect any or all types of the Solid Waste listed in this Section 2.7, including Recyclable Materials, without see 'ldng or obtaining approval of the Company under this Agreement. This grant to the Company of an exclusive Franchise, right and privilege to Collect, transport, or process and Dispose of Solid Waste shall be interpreted to be consistent with state and federal laws, now and during the term of the Franchise, and the scope of this exclusive Franchise shall be limited by current and developing state and federal laws with regard to Solid Waste handling, exclusive Franchise, control of Recyclable Materials, Solid Waste flow control, and related doctrines. In the event that future interpretations of current law, enactment or developing legal trends limit the ability of the City to lawfully provide for the scope of Franchise services as specifically set forth herein, the Company agrees that the scope of the Franchise will be limited to those sen,ices and materials which may be lawfully provided for under this Ag-reement, and that the City shall not be responsible for any lost profits claimed by the Company to arise out of further limitations of the scope of the A~eement set forth herein. In such an event, it shall be the responsibility of the Company to mirdmize the financial impact to other services being provided as much as possible. City's Right to Direct Changes 2.8.1 General The City may direct the Company to perform additional sen, ices (including new diversion prog-rams, etc.) or modify the manner in which it performs existing services or bills for services. Pilot progams and innovative services which may entail new Collection methods, different -kinds of services and/or new requirements for Customers, and alternative rate structures are included among the kinds of changes which the City may direct. The Company shall be entitled to an adjustment in its Company Compensation in accordance with Section 6.5 for providing such additional or modified services. D~rrba' 1,1~ -15- 2.9 2.8.2 New Diversion Programs The Company shall present, within 30 days of a request to do so by the City, a proposal to provide additional or expanded diversion services. The proposal shall contain a complete description of the following: · Collection methodoloD, to be employed (equipment, manpower, etc.). · Equipment to be utilized (vehicle number, t3qves, capacity, age, etc.). · Labor requirements (number of employees by classification). · T3qve of materials containers to be utilized. · Provision for program publicity/education/marketing. Three-year projection of the financial ?esults of the program's operations in an operating statement format including documentation of the key assumptions underlying the Projections and theSupport for those assumptions. 2.8.3 City's Right to Acquire Services The Company acknowledges and a~ees that the City may permit other Persons besides the Company to provide additional Solid Waste services not otherwise contemplated under this Agreement. If pursuant to Section 2.8.2, the Company and the City cannot agree on terms and condi'tions of such additional or expanded diversion services within ninety (90) days from the date when the City first requests a proposal from the Company to perform such services, the Company acknowledges and agrees that the .City may permit Persons other than the Company to provide such services. In the event that City exercises its right to permit third party Persons to provide such services, and if such a decision reduces or eliminates Company's collection services as contemplated under Company's Bid and Article 4 of this Agreement, Company agrees to reduce its Billings proportionately. Ownership of Solid Waste Once Solid Waste is placed in Containers and properly placed at the desig-nated Collection location, ownership and the right to possession shall transfer directly from the Customer to the Company by operation of this Agreement. Subject to the 2.10 2.11 Company's objective to meet the Source Reduction and Recycling goals which apply to the City and the City's right to direct the Company to process and dispose of Solid Waste at a particular licensecl Solid Waste Facility or to dispose of Solid Waste at a particular licensed Disposal Site, if and ordy if the City exercises such right by providing specific written direction to the Company, the Company is hereby granted the right to retain, Recycle, process, Dispose of, and otherwise use such Solid Waste, or any part thereof, in any lawful fashion or for any lawful purpose desired by the Company. Subject to the, provisions of this Ageement, the Company shall have the right to retain an5' benefit resulting from its right to retain, Recycle, process, Dispose of, or reuse the Solid Waste, Yard Waste, and Recyclable Materials which it Collects. Solid Waste, Yard Waste, and Rec-3,clable Materials, or any part thereof, which is disposed of at a Disposal Site or sites (whether landfill, transformation Facility, Transfer Station, Processing Facility or Material Recovery Facility) shall become the property of the O~mer or operator of the Disposal Site(s) once deposited there by the Company. The City may obtain ownership or possession of Solid Waste placed for Collection upon written notice of its intent to do so, however, not _hing in this Ag-reement sha!_l be __ COnstrued as giving rise to any inference that the City has such ownership or possession unless such written notice has been ~ven to the Company. Company Status The Company represents and warrants that it is duly organized, validly existing and in good standing under the laws of the. It is qualified to transact business in the State of California and has the power to provide services as required by this Agreement. · Company Authorization The Company has the authority to enter into and perform its obligations under this Ageement. The Board of Directors or partners of the Company (or the shareholders, if necessary) have taken ail actions required by law, its articles of incorporation, its bylaws or otherwise to authorize the execution of this A~eement. The Persons sig-ning this Ageement on behalf of the Company have authority to do so. Company shall authorize one employee for the City as a single point of contact for issues arising under this Agreement. City may accept that this employee's actions are taken on behalf of and with the full aPproval of the Company. D~r/tle'l, 1~°~ -17- C;lyo(T~n 2.12 Annexations This Agreement extends to an3, territory annexed to the City during the term of this Agreement except to the extent that collection by the Company within that annexed territory would violate the provisions of Public Resources Code Section 49520. In such event, this Agreement shall become effective as to such area at the earliest possible date permitted by law, and the City agrees that it shall cooperate with the Company to fulfill any requirement necessary for the Company to serve the annexed area consistent with this paragraph. ARTICLE 3 3.1 FRANCHISE & ADMINISTRATIVE FEE Franchise and Administrative Fee 3.1.1 Franchise Fee Amount In consideration of the exclusive Franchise granted pursuant to this Agreement, the Company shall pay to the City a Franchise Fee equal to two percent (2%) of the Company's Gross Receipts received from customers billed by the Company, except that receipts from customers temporarily billed by the Company prior to being added to the tax roll for billing by the City shall be excluded. The COmpany shall remit to the City two percent (2%) of the Gross Receipts received from these specified accounts according to section 3.1.3 below. 3.1.2 Administrative Fee __ . . . _. The Company shall pay to the City an Admirdstrative Fee in a one time lump sum payment equal to ninety thousand dollars ($90,000) within seven days of execution of this Agreement to reimburse the City for its staff time and out-of-pocket costs of awarding the franchise. 3.1.3 Time and Method of Payment From accounts billed by the Company, Company shall remit the Franchise Fee payment on or before the thirtieth (30~') day following the end of each quarter, during the term of this Agreement as provided in Section 3.1.1. If the Franchise Fee is not paid on or before the thirtieth (30~') day following the end of the quarter, the Company shall pay to the City a service charge, and not as interest, in an amount equal to ten percent (10%) of the amount owning for that quarter. The Company shall pay an additional ten percent (10%) service charge on any unpaid balance for each additional thirty (30) day period the Franchise Fee remains unpaid. Late payment service charges shall not be included in any revenue requirement. The Company agrees that the service charges contemplated by this Section 3.1.3 reasonably reflect the cost to the City to process any delinquency calculations and notices, and to monitor the Company's services, all in an effort to collect the delinquent Franchise Fees which, together with all other remedies -19- (2yc/Tts~ 3.2 afforded City under this Agreement (including an), award of attorney's fees and costs), and in accordance with applicable laws, are intended to compensate Ci~ in any collection efforts in the event of Company's default in the payment of Franchise Fees. Business License The Company and any subcontractors shall annually obtain a City of Tustin Business License. No contracts for services provided in the City shall be awarded to any vendor until such business license has been obtained, and all fees paid therefore, by the vendor and the subcontractors. 3.3 Other Fees The City shah resen,e the right to set other fees, as it deems reasonably necessary. The amount, time and method of payment and adjustment process will be set similar to Section 3.1.3 above. ARTICLE 4 DIRECT SERVICES 4.1 Refuse Collection Services 4.1.1 General The work to be done by the Company pursuant to this A~eement shall include, but not be limited to, the furnishing of all labor, supervision, equipment, materials, supplies, and ail other items necessary to perform the services required. The enumeration of, and specification of requirements for, particular items of labor or equipment shall not relieve the Company of the du~, to furnish all others, as may be required, whether enumerated elsewhere in the Ag-reement or not. The work to be done by the Company pursuant to this Agreement shall be accomplished in a thorough and professional manner so that the residents within the . _ Cit$, are provided reliable, courteous and high-qualitY Solid waste Collectic~n at all times. 4.1.2 Single Family Dwelling Unit Refuse Collection- AUtomated Cart Service Company shall Collect Refuse delivered for Collection bY Single Family Dwelling Unit Customers at the curbside from Company-provided Carts, not less than once per week. Standard Collection service shall be automated Collection unless another method is approved by the City. Company will supply each Single Family Unit with one 96-gallon container, With an option to obtain additional refuse containers for $4.00 per month per Cart, to be billed twice per year, in January and July, directly by the Company. Customers may exchange the 96-gallon Cart for a smaller 35- or 64-gallon Cart at no additional charge. Company shall provide Refuse Collection services in accordance with the Company's Bid (Exhibit 1). Single-Family Dwelling Unit Customers will be allowed to change Cart sizes (e.g., from a 96-gallon refuse Cart to a 64-_ gallon or 35-gallon refuse Cart) at no charge once per calendar year. The Company may charge residents $4.00 per exchange to exchange Carts more than once per calendar year. 4.1.3 Multi-Family .Dwelling Unit Refuse Collection - Automated Cart Service Multi-Family Dwelling Units may receive Cart service, where such collection is operationally feasible and permitted by the City. Feasibility shall be determined by whether road conditions permit sufficient access for collection of Carts, and storage conditions available for Carts. City reserves the right to decide where automated Collection is implemented. Company shall provide Carts in sufficient quantities and sizes to each Multi-Family building that participates in the automated refuse program. Company shall collect and remove all Refuse that is placed in Carts from all Multi- Family Dwelling Units within the City at least once every week or more frequently if required to handle the Solid Waste stream of the Premises where the Carts are located. The desig-nated collection location, if disputed by the customer or the Company, shall be determined by the Ci~,. Additionally, ff in the City's opt-Lion the existing Collection location is inappropriate, the City may require the Customer and/or the Company to relocate the Collection location. 4.1.4 _ Commercial and Industrial Property Refuse Collection- Automated Cart Service Company shall provide one or more 96-gallon Cart(s) (or other appropriate sizes) to each Commercial and Industrial Property Customer for the Collection of Solid Waste, where such collection is feasible and permitted. Feasibility shall be based upon the amount of waste generated, whether road conditions permit sufficient access for collection of Carts, and storage conditions available for Carts. Company shall collect and remove all Refuse that is placed in Carts from all Commercial and Industrial Property within the City at least once every week or more frequently if required to handle the Solid Waste stream of the Premises where the Carts are located. The desig-nated collection location, if disputed' by the customer or the Company, shall be determined by the City. Additionally, if in the City's opinion the existing Collection - location is inappropriate, the City may require the Customer and/or the Company to relocate the Collection location. 4.1.5 Multi-Family, and Commercial and Industrial Refuse Collection- Bin Service Company shall offer Bin service to Multi-Family, Commercial and Industrial Customers. Company shall collect and remove all Refuse that is placed in Bins froTM all Multi-Family Dwelling Units, and Commercial and Industrial Properties receiving Bin service, at least once every week or more frequently if required to handle the SOlid Waste stream of the Premises where the Bins are located. Special consideration shall be given when determining the pick up area to ensure that the flow of traffic is not impeded. 4.1.6 Manual Can Sen, ice Company shall ordy provide manual Can service to Single-Family, Multi-Family, and Commercial Customers, using Customers own containers, where neither Cart nor Bin service is feasible due to the 10w volume of Solid Waste Generated, or the inability to operate automated trUcks, or the inability to store or use Carts reasonably at the service location. For Commercial Customers, such service is limited to Customers generating no more than 200 lbs. of refuse per week. 4.1.7 Temporary Bins and Rolloff Box Service The CompanY shall offer Temporary Bin Service and Rolloff Box sendce to Single and Multi-Family Dwelling Units, and Commercial and Industrial Property for the Collection of Refuse or Construction Waste. The Company shall deliver and Collect temporary Bins and Rolloff Boxes at the direction of the Customer. Temporary Bins and Rolloff Boxes shall be free of graffiti and in good repair, and must be clearly marked and identifiable as belonging to the Company. Special consideration shall be given when determining the Collection location for temporary Bins and Rolloff Box service Customers to ensure that the flow of traffic is not impeded. The designated Collection location, if disputed by the customer or the Company, shall be determined by the City. Additionally, if in the City's opinion the location of an existing Collection location is inappropriate for aesthetic or safety reasons, the City may require the customer and/or Company to relocate the Collection location. 4.1.8 City Facilities' Collection Company shall Collect and dispose of all Solid Waste generated at Premises Owned and/or operated by the City, billing City according to the approved rate schedule. Collections shall be scheduled at a time mutually agreed upon by the Company and the City. The current location of these public collections are described in Exhibit 2, along with prior sen, ice levels and initial service level increases. Company will provide ~1,1999 -Z3- C~/dT~ Recycling Containers where feasible at City facilities and provide for the Collection of such Recyclables at no additional charge. Company will also provide a Yard waste roll- off box at the City yard at no additional charge. 4.1.9 On-Call Bulky Item Pickup Company shall provide bulky item pickup service to Single Family and Multi-Family Residential Customers. Bulk}, items include things such as appliances and household furniture, and do not include such things as car bodies, landscape material, and construction debris. Single Family and Multi-Family Customers will be entitled pickups per dwelling unit per calendar },ear, with a maximtam of three items per pickup, for no additional charge. Customers will provide the Company with 48 hours notice and the items will be collected on the customer's reg-ular collection day. Additional pickups will be $20.00 for each pickup. An additional $10.00 per item may be charged for an}, item over three (3) items in any one collection. 4.1.10 Abandoned Item Collection Company shall, at no additional charge, collect abandoned items in the streets and alleys when notified by the City and provide a roll-off box at the City yard for disposal of abandoned items collected by City crews. Abandoned items to be collected by the Company in the streets and alleys are intended to be the same ts, pes of items described as bulky items in Section 4.1.9. 4.1.11 City Sponsored Events The Company shall provide Solid Waste and Recycling Collection service at City desig-nated events each },ear as described in its Bid. This shall include providing Containers to Collect and Dispose of all Solid Waste, and providing Containers to Collect source-separated Recyclables. The Company shall provide these services at no additional cost to the City, the ratepayers, or the event sponsors. Such events include: · Tiller Days; · Tree Lighting; · Street Fair/Chili Cook-Off; · Community Yard Sale; and, · Fourth of July Celebration. 4.2 Recycling Services 4.2.1 Single Family Dwelling Unit Recycling Company shall issue each Single Family Dwelling Unit one 96-gallon Recycling Cart at no additional charge. Company will make available one or more additional Recycling Carts to customers who reg-ularly recycle more than will fit into their existing Recycling Cart(s). Customers may also exchange their 96-gallon Carts for smaller 64-gallon Carts. No extra fee may be charged for additional Carts, and no discounts given for using smaller or no Carts. Company shall Collect and remove all Recyclable Materials placed in Recycling Carts at the curbside for Single Family Dwelling Units. Recyclable Material CollectiOn from Residential Property within the City shall be once each week. At a mirfirn~, Recyclable Material Collected from Residential Property shall include, but not be ].imited to: glass, tin, steel, aluminum, PET plastic, H-DPE plastic, narrow neck plastics, newspaper, mi.xed paper (including junk mail, phone books, and magazines), metal coat hangers, and cardboard. Recyclable Materials are to be commingled in a single type of Recycling Cart.. Residential Recyclable Materials Collection shall be on the same day of the week as Refuse Collection service. 4.2.2 Multi-Family Dwelling Unit Recycling The Company agrees to provide, at no additional charge, Multi-Family Recycling Collection service to all Multi-Family customers requesting it from the Company. The Company agrees to provide recycling Bins or Carts in sufficient quantitiek to meet the Recycling needs of each Multi-Family complex. Multi-Family Dwelling Units shall be offered Recyclables Collection of the same Recyclable Materials as Single-Family Dwelling Units. The Company also agrees to make programs available for ail other Recyclable Materials for wKich it has estab~hed markets. The Company shall notify all its Multi-Family customers each year of.the availability of Multi-Family Recycling Collection programs. 4.2.3 Commercial Recycling The Company agrees to provide, at no additional charge, Commercial Recycling Collection service to all Commercial and Industrial PrOperty Customers requesting it from the Company. Commercial Recycling Collection programs shall be made available at a minimum for: mixed office paper; cardboard; newspaper; scrap metal including Cans; glass; PET plastic; HDPE plastic; all narrow neck plastics; and scrap lumber. The Company also agrees to make programs available for all other materials for which it has established markets. The Company shall notify ail its Commercial and Industrial Property Customers each year of the availability of Commercial Recycling Collection programs. Commercial Recycling Collection shall be performed using a container type (i.e., Carts, Bins) mutually ag-reed .upon by the Company and the Customer or C)wner of the property. Customers that reg'ularly contaminate the contents of their recycling containers with unreasonably high amounts of non-recyclables may have their recycling containers removed by the Company with the advance approval of the City. 4.2.4 Construction Waste Recycling The Company shall make reasonable efforts to prevent Construction Waste that is' suitable for Re~,cling from being taken to the landfill by transporting it to an alt.ernate Facility where it will be processed for reuse. Such efforts include, but are not limited to, contacting and educating building contractors about available recycling sen, ices. City will provide Company with a minimm list of contractors to contact. 4.2.5 Mixed Waste Processing Company agees to transport all refuse from Multi-Family, Commercial and Industrial Customers that do not participate in recycling collection progams to a MRF for mixed waste processing to recover recyclables and yard waste. The minimum diversion rate that shall be achieved by such mixed waste processing is 15% of the solid waste processed. The requirement to perform mixed waste processing, and the 15% minimum diversion rate for such processing, shall not apply if the Company otherwise achieves the overall 50% diversion requirement specified in Section 4.4. 4.2.6 Warning Notice The'Company shall warn customers who have non-recyclables in their recycling' container. If after two sequential written warnings the container continues to be contaminated, the Company may remove the Recycling Container from Customers who fail to sort properly and seg-regate Recyclable Materials. The Company shall report monthly to the City any warning notices issued. 4.2.7 Marketing and Sale of Recyclable Materials 4.3 The Company shall be responsible for marketing and sale of all Recyclable Materials Collected pursuant to this Agreement. Company shall retain proceeds from sales of Recyclable Materials. Yard Waste Program 4.3.1 Single Family Dwelling Unit Yard Waste Collection Company shah provide wee 'kly automated curbside Collection of Yard Waste on the same day as Refuse and Recycling Collection from the City's Single Family Dwelling . Units that' is placed in Carts. Company shah issue each Single Family Dwelling Unit Customer one 96-gallon Yard Waste Cart. Customers may return the Ca~, .if the), so choose. Company shall make available one or more additional Yard Waste Cart to customers that reg-ularly separate more Yard Waste than will fit in their current Cart(s). Company shall make available a smaller 64-gallon Cart for space constrained Customers. Yard Waste Services and additional Carts shall be provided at no Charge. Company shall also collect an unlimited amount of tied bundles of Yard Waste, up to the Tustin City Code 4323(b) size restrictions of six (6) feet long, four (4) feet in width, and 50 lbs. in weight. 4.3.2 Commercial & Industrial and Multi-Family Dwelling Unit Yard Waste Collection The Company shall offer automated Yard Waste Collection to commercial and industrial, and multi-family customers. The Company shall notify all of its commercial and industrial, and multi-family refuse customers of the availability of Yard Waste Collection service at least once each year. For those commercial and industrial, and multi-family customers who choose to participate, the Company shall provide Yard Waste Collection at no additional charge. 4.3.3 Christmas Tree Collection Program Company shall operate an annual Christmas Tree Collection program. The program shall include both curbside and drop-off CoLlection and target all Single Family and Multi-Family Dwelling Units in the City. The Company shah reasonably cooperate with the City in the scheduling and operation of the Christmas tree collection prog'ram. -27- 4.3.4 End Uses for Yard Waste 4.4 4.5 Company shall divert Yard Waste materials Collected through curbside Collection, and Christmas tree Collection from Disposal. The Company must provide end uses for Yard Waste that maximize diversion credits for the City according to reg-ulations established by the California Integrated Waste Management Board. Diversion Requirements The minimum amount that shall be diverted through Recycling, Yard Waste collection, Mixed Waste Processing, and Transformation is 50% of the total waste stream during each year of this Agreement. Transformation shall consist of a maximum of 10% of the total waste stream. Should the City not reach the AB 939 50% diversion goal for its entire wastes~eam, the Company agrees to make reasonable efforts to implement programs and provide equipment necessary in order for the City to meet the 50% diversion goal, and agrees that neither the City nor Customers shall not be required to expend any funds whatsoever in regard thereto. _ Operations 4.5.1 Schedules To preserve peace and quiet, in accordance with Tustin City Code Section 4335, no Solid Waste shall be Collected between 8:00 P.M. and 7:00 A.M. on any day. ReSidential Solid Waste shall be Collected MOnday through Friday, unless the City approves Saturday collection on a case by case basis. Commercial and Industrial Solid Waste Collection shall be collected Monday through Saturday. If the reg-ularly scheduled Collection day falls on New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, or Christmas Day, alternate collection shall be performed on the following day, unless that day falls on Sunday. Alternative collection shall then be performed on the following Monday.. All other Collection days falling on a legal holiday shall remain as scheduled. The Company shall be prepared to review its operations plan outlining the Collection routes, intervals of Collection and Collection times for all materials Collected under this Agreement with the City once annually upon 30-day written notice requesting said review. More frequent reviews may be required if operations are not satisfactory based on documented observations or reports of complaints. If the plan is determined to be inadequate by the City, the Company shall revise its plan incorporating an), changes into a revised plan and review said revised plan with the City within thirty (30) calendar days. When notified of a missed pick-up, the Company shall Collect the Refuse, Recyclable Materials, and/or Yard Waste within one (1) business day. 4.5.2 Vehicles · . .. A. General. The Company shall provide Collection vehicles sufficient in number and capacity to efficiently perform the work required by this Ageement in strict accordance with its terms as described in the Company's Bid. Any additional vehicles/routes that may be required to meet the service standards during the term of this Agreement, above the number included in the Company's Bid shall be done so at the Company's sole expense. The ComPany shall have available on Collection days sufficient back-up vehicles for each type of Collection vehicle used to respond to com- plaints ahd ~mergencies.- B. Specifications. All vehicles used by the Company.in providing Refuse, Recycling, and Yard Waste Collection services shall be reg-istered with the California Department. of Motor Vehicles. All such vehicles shall have water-tight bodies desig-ned to prevent leakage, spillage or overflow. C. Vehicle Identification. The Company's name, local telephone number, and a unique vehicle identification number desig-ned by the Company for each vehicle shall be prominently displayed on all vehicles, in letters and numbers no less than (3) three inches high. The Company shall not place the City's name and/or any City logos on the Company vehicles. D. Cleaning and Maintenance 1) The Company shall maintain all of its properties, vehicles, facilities, and equipment used in providing sen, iCe under this Agreement in a good, Safe, neat, clean and operable condition at all times. 2) Vehicles used in the Collection of Refuse, Recyclable Materials,. and Yard Waste shall be painted, thoroughly washed, and thoroughly steam cleaned on a reg-ular ~1,1.,,.~ -29- QyofTu~ basis so as to present a clean appearance. The City may inspect vehicles at an), time to determine compliance with this Agreement. The Company shall also make vehicles available to the Orange Count), Health Department for inspection, at any frequency it requests. The Company agrees to replace or repair to the City's satisfaction, any vehicle which the City determines to be of unsightly appearance, leaking, or in unsatisfactory operating condition. 3) The Company shall repaint all vehicles used in the Collection of Refuse, Recyclable Materials and Yard Waste within sixty (60) days' notice from the Ci~,, if the City determines that their appearance warrants painting. 4) The Company shall inspect each vehicle daily to ensure that all equipment is operating properly. Vehicles which are not operating properly, orveh.ides' in such a condition as to be unsafe or excessively noisy, shall be removed .from sen;ice until repaired and operating properly. The Company shall reasonably perform all scheduled maintenance functions in accordance with the manufacturer's specifications and schedule. The Company shall keep accurate records of all vel-dcle maintenance, recorded acc.ording to date and mileage (or hours of operation) and shall make such records available to the City upon request. 5) The Company shall repair, or arrange for the repair of, all of its veh.icles and equipment for which repairs are needed because of accident, breakdown or any other cause so as to maintain all equipment in a safe and operable condition. If an item of repair is covered by a warranty, the Company shall obtain warranty performance. The Company shall maintain accurate records of repair, which shall include the date and mileage (or hours of operation), nature of repair and the verification by signature of a maintenance superxdsor that the repair has been properly performed. 6) Upon request by the City, the Company shall furnish the City a written inventory of all equipment, including Collection veh/cles, used in providing service, and shall update the inventory annually. The inventory shall list all equipment by manufacturer, ID number, date of acquisition, type,'and capacity. E. Operation. Vehicles shall be operated in compliance with the California Vehicle Code, and ~11 applicable safety and local ordinances. The Company shall not load vehicles in excess of the manufacturer's recommendations or limitations imposed by state or local weisht restrictions on vehicles. Equipment shall comply with US EPA noise emission reg-ulations, currently codified at 40 CFR Part 205 and other applicable noise control regnlations, and shall incorporate noise control features throughout the entire vehicle. In no event shall the noise level of equipment used for Collection exceed 75 dba when measured at a distance of 25 feet from the vehicle, five feet from the ground. The Company shall store all equipment in safe and secure locations in accordance with the City's applicable zoning regnlations. Subject to Section 9.1, the Company shah be responsible for any damage resulting from or directly a~-ibutable to any of its operations, and which it causes to: the City's driving surfaces, whether or not paved; associated curbs, gntters and traffic control devices; other public improvements; and private roads and .alleys. F. City Inspection Per Code. The City may cause any vehicle used in performance of this A~eement to be inspected and tested at any commercially reak-onable time and in such manner as may be appropriate to determine that the vehicle is being maintained in compliance with the applicable provisions of the State Vehicle Code, including all Vehicle Code Sections regarding smog equipment requirements. The City may direct the removal of any vehicle from service if that vehicle is found to be in nonconformance with applicable codes. No vehicle directed to be removed from service by the City shall be returned to sen, ice until it conforms with, and its return to service has been approved by the City. G. Brake Inspections. The brake system of each vehicle used in performance of this A~eement Shah be inspected and certified annually according to state law by tb.e California Highway Patrol or by a brake inspection station licensed by the California Highway Patrol. Notice of certification shah be filed with the City within thirty (30) days after each such certification. Failure to submit the required certification shall be gounds for terminating this Agreement. H. Correction of Defects. Following any inspection, the Public Works Director shall have the right to cause the Company, at its sole cost and expense, to.recondition or replace any vehicle or equipment' found to be unsafe, unsanitary or unsightly. The Public Works Director's determination may be appealed to the City Council, which decision shah be final. 4.5.3 Containers 4.5.3.1 Cart Design Requirements The Carts shall be manufactured by injection or rotational molding and meet the Cart design requirements as specified below and performance requirements in Section 4.5.3.2. 4.5.3.1.1 Capacity The Company shall provide Carts in three sizes for residential Refuse, Recycling and Yard Waste collection. Acknowledging the different sizes provided by the various Cart manufacturers, the Carts shall be uniform in appearance and must conform to the following ranges in size: . · 32 to 35-gallo~, · 60 to 67-gallons, and · 90 to 100-gallons. 4.5.3.1.2 Cart Handles The Cart handles and handle mounts may be 'an integrally molded part of the Cart body or molded as part of the lid. Bolt-on handles are acceptable. The Cart handles will provide comfortable gripping area for pulling or pushing the Cart or lifting the lid. Pinch points are unacceptable. 4.5.3.1.3 Cart Lid o . 'Each container shall be provided with a lid that continuously overlaps and comes in contaCt with the container body or otherwise causes an interface with the container body that simultaneously: · Prevents the intrusion of rainwater, rodents, birds, and flies; -32- · Prevents the emission of odors; · . ....- Enables the free and complete flow of recycling material from the container during the dump cycle without interference with the material already deposited in the truck body or the truck body itself and its lifting mechanism; Permits users of the container to conveniently and easily open and shut the lid throughout the serviceable life of the container; · The lid handle shall be an integ-ra.lly molded part of the lid; · The lid (and body) must be of such design and weight that would prevent an empty container from tilting backward when flipping the lid open; The lid shall be hinged to the Cart body in such a manner so as to enable the lid to be fully opened, free of tension, to a position whereby it may rest against the backside of the container body; and, Thelid Shall be desig-ned t° be easily removed in the event of'damage or failure. The. hinge assembly shall not be capable of being readily removed by the public by hand or with ordinary tools. 4.5.3.1.4 Foot-Hold Each Cart shall have a fo°t-hold area on the back of the container to allow for foot · placement so as to assist in tilting back the container prior to rolling it. 4.5.3.1.5 Cart Colors The Refuse, Recycling and Yard Waste Carts will be differentiated by color. The colors shall be colorfast and resistant to fading as a result of weathering or ultraviolet degradation. Color must be uniform within each container, conforming through visual inspection to an acceptable range of color to be determined by the City after award of the contract. 4.5.3.1.6 Wheel Design and Axle Assembly Each Cart shall be equipped with an axle and m,o wheels, positioned on the bottom of the container to facilitate it being pushed or pulled with little effort with load weights up to its maximum load capacit3, as set forth in Section 4.5.3.2.2 of the Agreement. 4.5.3.1.7 Identification Markings The following mar'kings shall be permanently marked (hot stamped in white color) on the exterior lid of each container in character size of no less than one (1) inch), the phrases: PROPERTY OF THE CITY oF TUSTIN ILLEGAL TO REMOVE FROM ADDRESS In character size in the range of 1/4 to 3/4 inch, the following phrases: DO NOT PLACE FLAMMABLE PRODUCTS -'- OR HOT ASHES IN THIS CONTAINER DO NOT DISPOSE OF HAZARDOUS MATERIALS IN THIS CONTAINER NO PONGA PRODUCTOS IMFLAMABLES O CENIZAS EN ESTE NO PONGA MATERIALS PELIGROSOS EN ESTE RECIPIENTE In character size in the range of 1/4 to 3/4 inch, the following item: MANUFACTURED (MONTH, YEAR) (as appropriate) MANUFACTURER'S IDENTIFICATION CODE (at the option of Contractor) The following markings shall be hot-stamped in white color in both English and Spanish on the back side of the Cart. In character size of no less than ~/4 inch, the phrase: DO NOT TILT OR ROLL CONTAINER WITH LID OPEN NO RUEDE EL RECIPIENTE CON LA TAPA At3IERTA An arrow (at least 3 inches by 5 inches) hot stamped in white color shall be placed on the lid, indicating the direction of Cart placement. In character size of no less than 3 / 16 inch, the phrase: PLACE CONTAINER WITH ARROW FACING STREET FOR COLLECTION COLOQUE EL RECIPIENTE CON LAS FLECHAS HACIA LA CALLE Additionally, the "City of Tustin," the City of Tustin logo and REFUSE, RECYCLING or YARD WASTE must be hot stamped in white color on the front or sides of the Cart, for example: . . City of Tustin (Logo) REFUSE 4.5.3.1.8 Additional Parts All parts necessary for the Cart to be complete and ready for operation and use by the residents of the City shall be furnished by the Company. 4.5.3.1.9 Replacement Parts All replacement and repair parts and components shah be of the same or better quality as the original parts provided to the City and must meet the same requirements as set forth in Section 4.5.3.2. 4.5.3.2 Cart Performance Requirements All Carts shah be desig'ned and manufactured to meet the minimum performance requirements described below. Da:a?t~l, 1....,.~ -35- 4.5.3.2.1 Minimum Service Life Carts shall have the capability for continual, uninterrupted use as refuse/recycling/yard waste Carts in residential applications as set forth in the Agreement for a minimum period of ten (10) years, herein referred to as the "Minimum Service Life". The Minimum Service Life shall be measured from the date of delivery or distribution. 4.5.3.2.2 Cart Load Capacity Depending on the capacity, the Carts shall have a minimum load capacity as noted belm~, without container distortion, damage, or reduction in maneuverability or any other functions as required herein. Cart Size (Gallons) Minimum Load Capacity (LBS) 90-100 60-67 32-35 200 130 70 4.5.3.2.3 Cart Durability Carts shall remain durable, and at a minimum, shall meet the following durability requirements to satisfy its intended use and performance, for a period of ten (10) years: · Maintain its orig-inal shape and appearance; · Be resistant to kicks and blows; · Require no routine maintenance and essentially be maintenance free; Not warp, crack, rust, discolor, or otherwise deteriorate over time in a manner that will interfere with its intended use; · Resist degradation from ultraviolet radiation; Be incapable of penetration by biting or clawing of household pets (i.e., dogs and cats); The bottoms of Cart bodies must remain impervious to any damage, that would interfere with the Cart's intended use after repeated contact with gravel, concrete, asphalt or any other rough and abrasive surface; All wheel and axle assemblies are to provide continuous maneuverabilit-y and mobiliPy as originally desig-ned and intended; and, Resist degradation by other airborne gases or particulate matter currently present in the ambient air of the City. 4.5.3.2.4 Chemical Resistant Carts shall resist damage from common household or residential products and chemicals. Carts, also, shall resist damage from human and animal urine and feces. 4.5.3'Z5 Stability and ManeUverability The Carts shall be stable and self-balancing in the upright position, when either empty or loaded to its maximum desig-n capacity with an evenly distributed load, ahd with the lid in either a closed or open position. The Carts shall be capable of maintaining its upright'position in sustained or g-usting winds of up to 25 miles per hour as applied from any direction. The Carts shall be capable of being easily moved and maneuvered, with an evenly distributed load equal in weight to its maximum desig-n capacity on a level, sloped or stepped surface. 4.5.3.2.6 Lid Performance Cart lid assemblies shall meet the following minimum requirements: Prevent damage to the Cart body, the lid itself of any component parts through repeated opening and closing of the lid by residents or in the dumping process as ' intended; ~1,1~ -37- Cly~TLS~ Remain closed in winds up to 25 miles per hour from any direction. All lid hinges must remain fully functional and continually hold the lid in the orig4nal desig-ned and intended positions when either opened or closed or any position between the two extremes; and, Lid shall be desig-ned and constructed such that it prevents physical injury to the user while opening and closing the container. 4.5.3.2.7 Reparability Minor cracks, holes, and other damages to hinges, ~vheels, axle, hardware, and other component parts shall be readily repairable by the contractor personnel with minimum training and supendsion. All repairs shall be capable of being performed by one person in the field. All repairs must restore the container to its full ftmctionality to meet the desig-n and performance requirements as set for herein. 4.5.3.3 Cart Ownership and Maintenance Responsibilities _ _ The Company'shall be responsible for Cart repair and maintenance, graffiti removal, and replacing lost, stolen or damaged Carts within 24 hours at no additional charge to the customer or to the City. If approved in advance by the City on a case by case basis, Company may charge customer a fee no higher than the Company's actual cost of repair and replacement in the event of willful neglect or abuse of the cart by the customer. All Carts provided under this Agreement shall become the property of the City at the end of this Ageement. The City reserves the right to have the Company remove the carts at the end of the contract term at no charge to the City. 4.5.3.4 B ins The Company shall provide commercial, industrial, and multi-family dwelling unit customers with Containers for Collection of Solid Waste. The Company shall maintain its Containers in a clean, sound condition free from putrescible residue. Containers shall be constructed of heavy metal, or other suitable, durable material, and shall be watertight and well painted. Wheels, forklift slots, and other appurtenances which were desigmed for movement, loading, or unloading of the Container shag be maintained in good repair. Company shall clean or replace all Commercial and Industrial Containers once per year at no charge. Company shall perform cleaning or replacement of Containers more frequently if necessary, for an additional fee, to prevent a nuisance caused by odors or vector harborage. Customer may request additional cleanings at $35 per cleaning. Graffiti shall be removed from any Container within twenty-four (24) hours of request by City or customers. Each Container placed in the City by the Company shall have the name of the Company in letters not less than three inches high on the exterior of the Container so as to be visible when the container is placed for use. The Company shall identifY the Containers that are assivcm.ed to each commercial, industrial, and multi-family customer using a method that is acceptable to the City. 4.5.4 Litter Abatement . .. · . · . A. Minimization of Spills. The Company shall use due care to prevent Solid Waste or fluids from leaking, being spilled and/or scattered during the Collection or transportation process. If any Solid Waste or fluids leak or are spilled during Collection, the Company shall promptly clean up ali such materials. Each Collection _ vehicle shall carry a broom and shovel at all times for this purpose. The Company shall not transfer loads from one vehicle to another on any public street, unless it is necessary to do so because of mechanical failure, accidental damage to a vehicle, or a pre-approved method of Solid Waste transfer between vehicles, without prior written approval by the City. B. Clean Up. During the Collection or transportation process, the Company shall clean up Litter in the immediate vicirdty of any SoLid Waste storage or collection area whether or not the Company has caused the litter. The Company shall identify instances of repeated spillage not caused by it directly with the Customer responsible and will report such instances to the City. The City will attempt to rectify such situations with the Customer ff the COmpany has already attempted to do so without Success. C. Covering of Loads. The Company shall properly cover all open Rolloff Boxes during transport to the Disposal Site. D. Special Clean-Up. City may hire Company for special clean-up situations in accordance with the approved rate schedule. -39- C~yo~T~fn 4.5.5 Personnel The Company shall furnish such qualified drivers, mechanical, supervisory, clerical, management and other personnel as may be necessary to provide the services required by this Agreement in a satisfactory, safe, economical and efficient manner. All drivers shall be trained and qualified in the operation of vehicles they operate and must possess a valid license, of the appropriate class, issued by the California Department of Motor Vehicles. The Company also agrees to establish and vigorously enforce an educational pro,am which will train the Company's employees in the identification of Hazardous Waste. The Company's employees shall not 'knowingly place such Hazardous Waste in the Collection vehicles, nor knowingly dispose of such Hazardous Wastes at the processing facility or Disposal Site. The Company shall train its employees in customer courtesy, shall prohibit the use of loud or profane lang-uage, and shall instruct Collect-ion crews to perform the work quietly. The Company shah use its best efforts to assure that all employees present a neat appearance and conduct themseh,es in a courteous manner. If any employee is found to be discourteous or not to be performing sen,ices in the manner required by this Agreement, the Company shall take all necessary corrective measures including, but not limited to, transfer, discipline or termination. If the City has notified the Company of a complaint related to discourteous or improper behavior, the Company will consider reassig-ning the employee to duties not entailing contact with the public while the Company is pursuing its investigation and corrective action process. The Company shall provide suitable operations, health and safety training for all of its employees who use or operate equipment or who are othem, ise directly involved in Collection or other related operations. 4.5.6 Identification Required The Company shah provide its employees, companies and Subcontractors with identification for all individuals who may make personal contact with residents or businesses in the City. The City may require the Company to notify customers yearly of the form of said identification. The Company shall provide a list of current employees, companies, and Subcontractors to the City upon request. The City reserves the right to perform a security and identification check through law enforcement agencies upon the Company and all its present and future employees, in accordance with accepted procedures established by the City, or for probable cause. 4.5.7 Fees and Gratuities The Company shall not, nor shall it permit any agent, employee, or Subcontractors employed by'it, to request, solicit, demand, or accept, either directly or Lndirectly, any compensation or ~atuit3,.' for temporary Bin/Rolloff Box sen, ices or the Collection, transportation, Recycling, processing, and Disposal of Solid Waste, otherwise required under this Agreement. .4.5.8 Non-Discrimination The Company shall not discriminate in the provision of service or the em?loyment of Persons engaged in performance of this A~eement on account of race, color, religion, sex, age, physical handicap or medical condition in violation of any applicable federal or state law. 4.5.9 Coordination With Street Sweeping Services Company shall coordinate route schedules with the Cit3,'s street sweeping schedule. Company shall provide all routes and route schedules to the City and work with City to resolve conflicts with street sweeping schedules. 4.5.10 Change in Collection Schedule The Company shall notify the City forty-five (45) days prior to, and Single Family Dwelling Unit Customers not later than fourteen (14) days prior to, any change in Single Family Dwelling Unit Collection operations which results in a change inthe day on which Solid Waste Collection occurs. The Company will not permit any customer to go more than seven (7) days without service in connection with a Collect/on schedule change. The City's approval of any change in Single Family Dwelling Urdt Collection is required prior to such change, and such approval will not be v;;ithheld unreasonably. Any changes in the route map or collection schedule shall require the prior approval of the City. The City may require changes in the route map or collection schedule, to improve sen;ice, to resolve complaints or for other reasons. -41- Clya'Tu~ -- 4.5.11 Report of Accumulation of Solid Waste; Unauthorized Dumping 4.6 4.7 The Company shall direct its drivers to note the addresses of any Premises at which the), obser~'e that Solid Waste is accumulating and is not being delivered for Collection; and the address, or other location description, at which Solid Waste has been dumped in an apparently unauthorized manner. The Company shall deliver the address or description to the City within five (5) wor 'kJ.ng days of such observation. Company shall cooperate with City in the investigation and prosecution of any violat/ons of the Tustin City Code. Timetable for R011-Out of Residential Carts Cart customers will receive manual Can service until automated service is phased in. Distribution of Carts and initiation of automated service may be phased in over a maximum of an eight (8) month period, as follows: Percentage of Cart Customers Days From Start of Agreement First 25% With/n first 90 days Next 25% Within 150 days Next 25% Within 195 da?s Last 25% Within 240 days Company may implement pro,ams sooner, but no.later than according to the above schedule. Transportation of Refuse The Company shall transport all Refuse collected under Section 4.1 to atransfer station, MRF, Transformation facility or Disposal Site. Unless the City otherwise obtains ownership of the Solid Waste or Refuse stream as described in Section 2.9, the Disposal Site shall be the Orange County Landfill System. The Company agrees to make all reasonable efforts to separate Recyclable Materials from Refuse for diversion from landfill Disposal. The Company shall maintain complete, accurate and up-to-date records of the quantities of Solid Waste transported to the transfer station, 1VLRF, Transformation facility, or Disposal Site and will cooperate with the City in any audits or investi§ations of such quantities. 4.8 Disposal of Refuse Company shall ensure that all Refuse collected under Section 4.1 is disposed' of at the Disposal Site. Unless and until the City otherwise obtains ownership of the Solid Waste stream under Section 2.9, the Disposal Site Company has designated shall be the Orange County LandfiLl System. 4.9 Status of Disposal Site 4.10 Any Disposal Site utilized by the Company shall be desiomaed and constructed in accordance with 23 California Code of Reg-ulations Section 2510 et seq. ("Subchapter 15"). Any such landfill must have been issued all permits from federal, state, regional, county and the City agencies necessary for it to operate as a Class El Sanitary Landfill and is in full reg-ulatory compliance with all such permits. Annual Route Audit At least once armually, the Company shall conduct an audit of its collection routes in the Ci~,. The annual route audit shall be prepared in form and content acceptable to the City and shall include the truck identity, number of accounts serviced, number and size of containers, frequency of pick-ups, as well as the weight of the refuse delivered to the Transfer Station or Disposal Site. Results of the annual route audit shall be available for review by the City or its representative. 4.11 Service Exceptions; Hazardous Waste Notifications A. Failure to Collect. Vv-hen Solid Waste is not Collected from any Customer, the Company shall notify the Customer in writing, at the time Collection is not made, through the use of a "tag" or otherwise, of the reasons why the Collection was not made. ,, B. Hazardous Waste Inspection and Reporting. The Company reserves the right and has the duty under law to inspect Solid Waste put out for Collection and to D~wt~ 1,1~ -43- Q),~Tu~ 4.12 reject Solid 'Waste observed to be contaminated with Hazardous Waste and the right not to collect Hazardous Waste put out with Solid Waste. The Company shall notify all agencies with jurisdiction, if appropriate, including the California Department of Toxic Substances Control and Local Emergency Response Providers and the National Response Center of reportable quantities of Hazardous Waste, found or observed in Solid Waste an)~,here within the City. In addition to other required notifications, if the Company observes any substances which it or its employees reasonably believe or suspect to contain Hazardous Wastes unlawfully disposed of or released on any City property, including storm drains, streets or other public rights of way, the Company will immediately not-if-y the Public Work's Director or the Public Wot 'ks Director's desigmee. C. Hazardous Waste Diversion Records. The Company shall maintain records showing the 52yes and quantities, if any, of Hazardous Waste found in Solid Waste and which ~'as inadvertently Collected from Customers within the City, but diverted from landfilling. Disaster Preparedness Plan Company shall submit to City on or before the effective date of the Agreement, a written contingency plan demonstrating Company's arrangements to provide vehicles and persormel and to maintain uninterrupted service during breakdowns, and in case of natural disaster or other emergency (not including a labor dispute), including the events described in Section 11.4. 5.1 ARTICLE 5 OTHER SERVICES Services and Customer Billing 5.1.1 Service Description Company shall armually, in September, prepare and distribute, subject to the direction of the Ci~,, a notice to each CUstomer a listing of the Company's collection rates, rates for other services, annual holiday schedule, recycling programs offered, and a general summary of services required to be provided hereunder and optional service which may be furnished by the Company. Such notice shall be in a form subject to the City's approval prior to its distribution. For Customers .billed by the Company, notice may be included with Billings. The notice may also be included as part of the Company's public education plan described below in Section 5.3.1. 5.1.2 Billing Customers Billed By the City The City will bill all Single Family Dwelling Unit Customers, and those Multi-Family or Commercial Customers who receive Refuse Can service on the tax roll. The number of active accounts billed on the tax roll shall determine the number of units for which the Company is due sen, ice charges from the City for the following rate 3,ear. This number of active accounts will be adjusted once per 3,ear in this manner for the upcoming Rate Year. Company will bill City monthly in advance for sendcing this determined number of accounts and City will issue Company a check. Customers that receive service at properties that are not yet on the tax roll, will be billed quarterly per rate year in advance by the Company until the'new properties are added to tax roll. Company will send a letter and post a notice on the door explaining how the service and billing will be handled. Discontinuation of service for delinquent accounts shall be handled in accordance with Tustin City Code, section 4336(c).. For accounts billed by the CID,, Company shall discontinue collection upon written notification from the City. Company shall also resume such collection on the next ~1,1~ -45- regularly scheduled collection day upon notification from the City to resume service. Company may charge a maximum of $10.00 Resumption of Service Charge. City shah have the option upon thirty (30) days notice to Company to have Company directly invoice and collect from some or all Cart or Can Customers. If Company assumes billing, the Company may increase the per unit monthly charge set forth herein by an amount to be ageed in writing with CIO,, based upon the increase in operational costs to be incurred by assuming billing. Customers Billed By the Company (Except Rolloff) Company shah invoice all customers that are not billed by the City. Customers shall be billed directly on a monthly basis, 30 days in advance, based on the size of their containers and frequency of collection. To start service new customers will pay for one month's service in advance. For accounts billed by Company, customers who have not remitted payments within twenty-five (25) days after the date of billing shall be notified on forms .approved by the City. The form shah state that Ser~,ice may be discontinued fifteen (15) days from the date of notice if payment is not made before that time. Company must also notify City fifteen (15) days prior to last date of collection. Upon payment of delinquent fees, Company shall resume collection on the next reg-ularly scheduled collection day. Company may charge a maximum of $10.00 Resumption of Service Charge, but may not charge for service during the period it was suspended. Rolloff Box Customers. In regard to the billing of Rolloff Box customers and the collection of those bills: For Single Family Dwelling Unit Customers who request Rolloff Box set,rice, the Company shah accept major credit cards for payment. Single Family Dwelling Unit ' Customers that do not use credit cards may be required by the Company to post a security deposit or pay on a "Cash on Delivery" (C. O. D.) basis. Any unused portion of a security deposit shall be refunded to the Customer within five (5) business days of the termination of service. For all other Rolloff Box Customers, the Company shall invoice monthly or semi- monthly in arrears with payment due within 15 or 30 days from the invoice date (i.e., the beginning of the month or the inception of sen, ice). Delinquent accounts shall be handled in the same manner as Bin Customers, see above. Company may require a D=,~=n~ 1,19~ 46- C3yOfTL~ security deposit for temporary roll-off boxes, with the unused portion refunded to the Customer within five business days of the termination of sen;ice. 5.2 5.1.3 Review of Billings The Company shall review its Billings to customers under Section 5.1.2. The purpose of the review is to determine that the amount which the Company is billing each customer is correct in terms of the level of service being provided to such customer by the Company. The Company shall review customer accounts annually, and submit to the City a written report of that review armually on the anniversary of the Effective Da}, of this Agreement. The Company shall maintain copies of said Billings and receipts, each in chronological order, for a period of five (5) },ears after the date of sen;ice for inspection by the City upon request. The Company may, at its option, maintain those records in computer form, on microfiche, or in any other manner, provided that the records can be preserved and retrieved for inspection and verification in a timely manner, are sufficient to verff-), accuracy of Franchise Fees owed to the CID,, and may be produced in a forTM a-nd manner sufficient to establish the existence of customer obligations in a court of competent jurisdiction. Customer Service 5.2.1 Office Hours Company shall provide an office in Orange County and office hours shall be, at a minimum, from 8:00 A.M. to 5:00 P.M., Monday through Friday, excluding holidays, A responsible and qualified representative of the Company shall be available during office hours for communication with the public at the office. Normal office hour telephone numbers shall be a toll free call. The Company's telephone system shall be adequate to handle the volume of calls t-)qvically experienced on the busiest days. The Company shall also maintain a toll free telephone number for use during other than normal business hours. The Company shall have a representative, answering or message providing/receiving (voice-mail) sen, ice available at said after-hours telephone number. After-hours calls shall be responded to on the next business day. Company shall provide the C/fy staff with the phone number of a live person who naa), be reached 24 hours a day. 5.2.2 Complaint Documentation All service complaints shall be directed to the Company. Daily logs of complaints concerning Collection of Solid Waste, Recyclable Materials and Yard Waste shall be retained for a minimum of twenty-four (24) months and shall be available to the City at all times upon request. The Company shall log ail complaints received by telephone and said log shall include the date and time the complaint was received, name, address and telephone number of caller, description of complaint, employee recording complaint and the action taken by the Company to respond to and remedy complaint. All 'a, ritten customer complaints and inquiries shall be date-stamped when received. All complaints shall be initially responded to within one (1) business day of receipt. The Company shall log action taken by the Company to respond to and remedy all complaints. All customer sen, ice records a_nd logs kept by the Company shall be available to the City upon request and at no cost to the City.- The City shall, at any time during reg-ular the Company business hours, have access to the Company's customer service department for purposes that may include monitoring the quality of customer service or researching customer complaints. 5.2.3 Resolution of Customer Complaints Disputes between the Company and its customers regarding the services provided in accordance with this Agreement may be resolved by the City. The City's decision shall be final and binding. Should Company and customers not be able to establish a mutually acceptable fee to be charged for special hauling services, the matter shall also be determined by the City, and the City's decision shall be final. Intervention by the City is not a condition precedent to any rights or remedies third parties might otherwise have in any dispute with Company. Nothing in this section is intended to effect the remedies of third parties against the Company. To the extent that · remedies are warranted through this Agreement, this shall apply. 5.2.4 Government Liaison The Company shall designate in writing a "Government Liaison" who shall be responsible for working with the City and/or the City's designated representative(s) to resolve customer complaints. City shall have the right to approve the Company's choice for a liaison. 5.3 Education and Public Awareness 5.3.1 General Company acknowledges and agrees that education and public awareness are critical, key and essential elements of any efforts to achieve AB 939 requirements. Accordingly, the Company ag-tees to implement a public education program to expand public and customer awareness concerning the need to and methods of reducing, reusing and recycling Solid Waste. Company shall cooperate fully with City in this regard. Company shall submit the public education prog-ram for approval by the City prior to the Effective Date of the Agreement. The approved public education program shall be incorporated as Exhibit 3 into this Agreement. Company shall maintain its own program of providing information relevant to billing and Solid Waste services, issues and needs, to both Customers that Company direct!y bills and Customers which are billed through the tax roll. All public education materials shall be approved in advance by City. All printed materials shall be printed on recycled paper. City may request the Company to perform mailing services and if so able, provide not less than thirty (30) days notice to the Company prior to the mailing date of any proposed mailing to permit the Company to make appropriate arrangements for inclusion of the City's materials. The City will provide the Company the mailers at least fifteen (15) days prior to the mailing date. The City shall normally bear the expense of reproduction and distribution of such additional information only to the extent it is clearly in excess of the Company's normal'billing costs and represents services beyond the at'proved public education plan. Company will provide a minimum of the following public education items to be developed and distributed at Company's expense: Initial Mailing- To customers explaining the transition from the existing program to the new program, as well as attendance at a minimum of two public wor 'ksho?s. T]~e mailing and workshops will describe program changes, route changes, dates of program implementation, and other necessary information. Public education materials are to be approved by the City in advance of distribution. Annual Brochures - Four (4) pages, full color informing Customers of how to use available services. Three (3) separate brochures shall be developed: one for Single- Family Customers, one for Multi-Family Customers, and one for Commercial and Industrial Customers. Quarterly Billing Inserts/Notices - Company is responsible for sending notices promoting and explaining programs and collection schedules at least quarterly to all Customers, at the City's request and with City's review and approval of the materials. Notices ma}, be inserted in the Billings for Customers billed directly by the Company. Corrective ACtion Notice - For use in instances where the customer sets out inappropriate materials. Educational Video -Company is responsible for the cost and production of one, eight-to-ten minute educational video on the new programs. Content of the video shall be approved in advance by the City. City will arrange to air it on the City cable channel. All brochures, mailings, and other educational materials shah bear the City seal, unless otherwise appro, red by the City. Company shall also provide a Company representative able to visit civic goups, homeowners' associations, and building managers at Multi-Family .complexes and Commercial businesses to promote and explain the recycling progams. 5.3.2 Community Events At the direction of the City, the Company shall participate in and promote Recycling and other diversion techniques at community events and local activities. Such participation would normally include providing, without cost to City, Collection of' 5.4 Solid Waste at the event and educational information promoting the goals of the City's Solid Waste diversion or recycling program. Waste Generation/Characterization Studies The Company ac'knowledges that the City may be required to perform Solid Waste generation and Disposal d~aracterization studies periodically to comply with AB 939 or other waste diversion requirements. The Company agrees to participate and cooperate with the City and its agents and to accomplish such studies at no additional cost the City. ., ~1,1!E0 -51- ARTICLE 6 6.1 6.2 6.3 COMPANY COMPENSATION AND RATES General The Company Compensation provided for in this Article shall be the full, entire and complete compensation due to the Company pursuant to this Agreement for all labor, equipment, materials and sup. plies, taxes, insurance, bonds, overhead, Disposal, transfer, profit and all other things necessary to perform all the services required and reasonably anticipated by this A~eement in the manner and at the times prescribed. The Company will' perform the responsibilities and duties described, in this Agreement in consideration of the right to receive compensation for services rendered at maximum rates fixed by the City from time-to-time. The City and the Company ag-ree that the Company will retain any proceeds from the sale of recyclable materials. Initial Rates The rates for the first t-wo Rate Years ending June 30m, 2002 shall not exceed those set forth in Exhibit 4, unless amended by a written amendment to this Agreement entered into by a_nd between the City and the Company. Unless and until the maximum rates set forth on Exhibit 4 are adjusted, the Company ss, ill provide the services required by this Agreement, charging no more than the maximum rates authorized by Exhibit 4, except as provided herein and in Section 6.3. Schedule of Future Adjustments Beginning with Rate Year 3 ( ,2002 to ,2003) and for all subsequent Rate Years, the Company may request an annual adjustment to the maximum rates shown in Exhibit 4. The Company shall submit its request in writing, to be received by the City in person or via certified mail, at least ninety (90) days prior to the start of the new Rate Year based on the method of adjustment described in Section 6.4. Failure to submit a written request at least ninety (90) days prior to the start of the new rate year shall result in the Company waiving the right to request such an increase for the subsequent 5,ear. ~1,1~,,~ -52- C~0fTus~ 6.4 Method of. Adjustments 6.4.1 General Pursuant to Section 6.3, the Company may request an annual adjustment to the maximum rates according to the method described below and the formulas shown in Exhibits 5A, 5B, and 5C, subject to review and approval of the City. All future adjustments are to be effective July 1st, and shall be based on the rates in Exhibit 4. 6.4.2 Customers Billed By the City Maximum rates for Customers billed on the tax roll shall be adjusted according to the followLng procedures and the example calculations' shox~m in Exhibit 5A. Step One- Determine the proportionate share of the disposal component and the service component of the rate revenue. Step Two - Calculate the percentage change in the Producer Price Index (PPI), and the percent change in the refuse disposal gate fee per ton. The change in the PPI shall be for the i~,elve month period ending on the most recent Dec. 31. Although rates are fixed for the first two years of the Agreement, the PPI adjustment in Rate Year 3 is limited to the PPI change only for the prior 12 months. The change in the refuse disposal gate fee shall be based on the change between the most recent gate fee on which rates are based and the new gate fee in the Orange County Landfill System. Step Three -Calculate the weighted percent change in maximum rates by: 1)' Multiplying the refuse disposal component as a percent of rate revenue net of franchise fees by the percent change in the refuse disposal gate fee; 2) Multiplying the service component as a percent of rate revenue net of franchise fees by the percent change in the PPI; and, 3) Adding the results of 1), and 2) above to determine the weighted percent change in rates. Step Four- Multiply one plus the weighted percent change in maximum rates by the then existing maximum rates to derive the newly adjusted maximum rates. .Step Five - In the event that the current percentage change in the PPI is negative, the existing rates shall not be then adjusted cloy, reward as a result. Instead, the rate adjustment shall be held in abeyance until the PPI increases in the future to the extent that the Cumulative change in the PPI since the last periodic rate adjustment is positive. At that time, the sen, ice component of the rates shall be adjusted based on the cumulative percentage change in the PPI since the last periodic rate adjustment. 6.4.3 Customers Billed By the Company Maximum rates for Bin Customers billed directly b3, the Company shall be adjusted according to the following procedures and the example calculations shown in Exhibit 5B, except for rolloff box rates which shall be adjusted in accordance with Section 6.4.4. Step One - Determine the rate revenue net of Franchise Fees by deducting the Franchise Fee portion from actual gross rate revenues for the hvelve month period ending on the most recent Dec. 31. Step Two- Determine the proportionate share of the disposal component and the service component of the rate revenue net of franchise fees. Step Three- Calculate the percentage change in the Producer Price Index (PPI), and the percent change in the refuse disposal gate fee per ton. The change in the PPI shall be for the twelve month period ending On the most recent Dec. 31. The change in the refuse disposal gate fee shall be based on the change be~,een the most recent gate fee on which rates are based and the new gate fee in the Orange County Landfill System. Step Four- Calculate the weighted percent change in maximum rates by: 1) Multiplying the refuse disposal component as a percent of rate revenue net of franchise fees by the percent change in the refuse disposal gate fee; 2) Multiplying the service component as a percent of rate revenue net of franchise fees by the percent change in the PPI; and, 3) Adding the results of 1), and 2) above to determine the weighted percent change in rates. Step Five- Multiply one plus the weighted percent change in maximum rates by the then existing maximum rates to derive the newly adjusted maximum rates. Step Six - In the event that the current percentage change in the PPI is negative, the existing rates shall not be then adjusted downward as a result. Instead, the rate adjustment shall be held in abeyance until the PPI increases in the future to the extent 6.5 that the' cumulative change in the PPI since the last periodic rate adjustment is positive. At that time, the service component of the rates shall be adjusted based on the cumulative percentage change in the PPI since the last periodic rate adjustment. 6.4.4 Rolloff Box Maximum load charges, delivery charges, and overweight charges for rolloff customers shall be adjusted according to the following procedures and the example calculations shown in Exhibit 5C. Steep One- Calculate the percent change in the PPI for the twelve month period for the most recent twelve months-ending on the most recent Dec. 31. Steo Two - Multiply one plus the percent change in PPI by the then existing maximum rates to derive the newly adjusted rolloff rates. Steo Three - In the extent that the current percentage change in the PPI is negat4ve, the existing rates shall not be then adjusted downward as a result. Instead, the rate adjustment shall be held in abeyance until the PPI increases in the future to the extent that the cumulative change in the PPI since the last periodic rate adjustment is positive. At that time, the serv'ice component of the rates shall be adjusted based on the cumulative percentage change in the PPI since the last periodic rate adjustment. Extraordinary Adjustments The Company or the City may request an adjustment to rates at reasonable times other than that required in Section 6.3 for unusual changes in the cost of providing service under this Agreement. Such changes may include changes in components of the Gate Rate, changes in the Disposal Site requested by the City, and changes in State or local government solid waste fees and charges. Such changes shah not include changes in the market value of ReCyclables from the values assumed in the Company's Bid, or inaccurate estimates by the Company of its proposed cost of operations. For each such request, the Company shall prepare a schedule documenting the extraordinary costs. Such request shall be prepared in a form acceptable to the City with support for assumptions made by the Company in preparing the estimate. The City shall review the Company's request and, in the City's sole judgment, make the final determination on the appropriate amount of the adjustment if any. -' 6.6 Supporting Information 6.7 Ia~ the event the Company requests a rate adjustment on the basis of unusual changes or extraordinary increases or costs of doing business, the Company shall provide the City with documentation supporting its request. Additionally, if required by the Ci~,, the Company will also provide a copy of its certified annual financial statements prepared by a Certified Public Accountant or a licensed public accountant, which shall have been prepared in compliance with Rule 58 of the "Rules and Reg-ulations of the State Board of Accountancy," as established by the California Code of Regulations, Title 16, Chapter I. Such Certified Public Accountant or licensed public accountant shall be entirely independent of the Company and shall have no financial interest whatsoever in the business of the Company. The City may specify the form and detail of the financial statements. Grants From time to time, Federal, State, or local agencies including the City may provide to the Company grants to assist in financing qualified programs provided by the Company. The Company agrees that the Company Compensation, calculated as described in Sections 6.2 thrOugh 6.5, shall be reduced by the amount of any such g-rant, unless the grant is used exclusively to pay for new services. The City Council shah determine whether the reduction in the Company Compensation shah be: (1) passed through to those Customers designated by the City as a reduction to their rates; (2) as an offset to a rate increase calculated in accordance with Sections 6.2 through 6.5; (3) paid to the City for use as the City directs; or, (4) applied in any combination of (1) through (3). Da:m-be-1,1~ -56- ARTICLE 7 REVIEW OF SERVICES AND PERFORMANCE 7.1 Performance Hearing The City may hold a public hearing on or about the t~vo 3,ear armiversary of the start of , this Agreement, and annually thereafter, at which time the Company shall be present and shall participate, to review the SOlid Waste Collection, source reduction, processing and other diversion sendces and overall performance. The purpose of the hearing is to provide for a discussion and review of technological, economic, and reg-ulatory changes in Collection, source reduction, Recycling, processing and Disposal to achieve a continuing, advanced Solid Waste Collect-ion, source reduction and Recycling and Disposal system; and to ensure sen,ices are being provided with adequate quality, effectiveness and economy. ForD;-five (45) days after receMng notice from the City of a Solid Waste Sen, ices and Performance Review Hearing, the Company shall, at a minimum, submit a report to the City indicating the following: a) Changes recommended and/or new services to improve the City's ability to meet the goals of AB 939 and to contain costs and minimize impacts on rates. b) Any specific plans for provision of changed or new sen, ices by the Company. The reports required by this Agreement regarding customer complaints shai1 be used as one basis for review. The Company may submit other relevant performance information and reports for consideration. The City may request the Company to submit specific information for the hearing. In addition, any customer may submit comments or complaints during or before the hearing, either orally or in writing, and these shall be considered. Topics for discussion and review at the Solid Waste Services and Performance Review Hearing shall include, but shall not be limited to, sen, ices provided, feasibility of providing new sen:ices, application of new technolo~es, customer complaints, amendments to this Ageement, developments in the law, new initiatives for meeting or exceeding AB 939's goals, reg-ulatory constraints and the ComPany performance. The ~ 1,1.~ -57- City and the Company ma), each select additional topics for discussion at any Solid Waste Services and Performance Review Hearing. Not later than sixty (60) days after the conclusion of each Solid Waste Sen;ices and Performance Review Hearing, the City may issue a report. As a result of the review, the City may require the Company to provide expanded or new services within a reasonable time and for reasonable rates and compensation and the City may direct or take Corrective actions for any performance inadequacies. 8.1 8.2 ARTICLE 8 RECORDS, REPORTS AND INFORMATION REQUIREMENTS General The Company shall maintain such accounting, statistical and other records related to its perfOrmance under this Agreement as shall be necessary to develop the financial statements and other reports required by this Ag-reement. Also, the Company agrees to conduct data collection, infon'nation and record keeping, and reporting activities needed to comply with applicable laws and regulation and to meet the reporting and Solid Waste prog-ram management needs of the City. To this extent, such requirements set out in this and other Articles of this Agreement shall not be considered limiting or necessarily complete. In particular, this Article is intended to only highlight the general nature of records and reports and is not meant to define exactly what the records and reports are to be and their content. Further, with the written direction or approval of the City, the records and reports to be maintained and provided by the Company in accordance with this and other Articles of the Agreement shall be adjusted in number, format, or frequency. Records 8.2.1 General The Company shall maintain records required to conduct its operations, to support requests it may make to the City, and to respond to requests from the City in the conduct of the City business. Adequate record security shall be maintained to preserve records from events that can be reasonably anticipated such as a fire, theft and earth~luake. Electronically maintained data/records shall be protected and backed up. All records shall be maintained for five (5) years after the expiration of this Ageement. The Company agrees that the records of any and all companies conducting operations addressed in the A~eement shah be provided or made available to the City and its official representatives during normal business hours. The City may review or utilize any of the records described in this section for any purpose, whatsoever. ~ 1,1~ -59- C2yor'TLsh 8.2.2 Financial Records Financial records shall be maintained and expense and revenue information for the City shall be segregated from other areas served by the Company. 8.2.3 Solid Waste, Recycling, and Yard Waste Service Records Records shall be maintained by the Company for the City relating to: a) Customer sen,ices and billing; b) Routes; c) Facilities, equipment and personnel used; d) Complaints;' e) Mdssed pick ups; f) Number of Refuse, Recycling, and Yard Waste Carts; g) Tons collected, processed, diverted, and disposed by ~'pe of service (Bin, Can, or Rolloff), Wastestream (Refuse, Recycling, Yard Waste) and Customer (Single-Family, Multi-Family, Commercial); and, h) Weight of each recyclable material recovered at the MRF. 8.2.4 CERCLA Defense Records The City views the ability to defend against the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) and related litigation as a matter of great importance. For this reason, the City regards the ability to prove where Solid Waste Collected in the City was taken for Disposal, as well as where it was not taken, to be matters of concern. The Company shall maintain data retention and preservation systems which can establish where Solid Waste Collected in the City was landfilled (and therefore establish where it was not landfilled) and pro,tide a copy of the reports required in Section 8.3 for five (5) years after the term during which Collection services are to be provided pursuant to this Agreement, or to provide copies of such records to the City. The Company agrees to notify the City's Risk Manager and the City Attorney at least 90 days before destroying such records. This provision shall survive the expiration of the period during which Collection services are to be provided under this Agreement. ~1,1~ .-60- C~cfTt~n 8.2.5 Disposal Records The Company shall maintain records of Disposal of all Solid Waste Collected in the Cie2, for the period of this Agreement and all extensions to this Agreement or successor A~eements. In the event the Company discontinues providing Solid Waste services to the City, the Company shall provide all records of Disposal or processing of all Solid Waste Collected in the City within thirty (30) days of discontinuing service. Records shall be in chronolo~cal and organized form and readily and easilY interpreted. 8.2.6 Other Programs' Records Records for other programs shall be tailored to specific needs. In general, they shall include: a) b) Plans, tasks, and milestones; and, Accomplishments in terms such as dates, activities conducted, quantities of products used, produced or distributed, and numbers of participants and responses. 8.2.7 Cost of Audit Should an audit by the city disclose that franchise or other fees, if any, payable by the Company were underpaid by two percent (2%) or more, or that two percent (2%) or more of the customers were billed incorrectly by the Company, for the period under review, the Company shall, in addition to any other remedy City might have, pay for the full cost of the City's audit. 8.2.8 Payments and Refunds Should an audit by the City disclose that the franchise fees or other fees, if any, payable by the Company were underpaid or that customers were overcharged for the period under review, the Company shall pay to the City any underpayment of franchise fees and/or refund to the Company's customers any overcharges. Should an audit disclose that Franchise Fees were overpaid, the City shall promptly refund to the Company the amount of the overpayment. Any refunds to be made by either party shall be due and payable (30) days following the date of the audit. -st- c~ru~ 8.3 Reports 8.3.1 Report Formats and Schedule Records shall be maintained in forms and by methods that facilitate flexible use of data contained in them to structure reports, as needed. Reports are intended to cOmpile recorded data into useful forms of information that can be used to, among other things: a) b) c) a) Determine and set rates and evaluate the'efficiency of operations; Evaluate past and expected progress towards achieving AB 939 goals and objectives; Determine needs for adjustment to programs; and, Evaluate customer service and complaints. The Company may propose report formats that are responsive to the object-ives and audiences for each report. The format of each report shall be approved by the City. The . Company ag-rees to submit ail reports on computer discs or by electronic means in a format compatible with the City's software/computers at no additional charge, if requested by the City. The Company will provide a certification statement, under penalty of perjury, by an authorized Company official, that the report being submitted is true and correct. Monthly reports shall be submitted within twenty (20) calendar days after the end of each month. Quarterly reports shall be submitted within twenty (20) calendar days after the end of the calendar quarter. If requested, the Company's complaint summary~ described in Section 8.3.2 (b) below, shall be sent to the City Manager within 5 days of request. Annual reports shall be submitted before January 31st following the reporting 3,ear. Ail reports shall be submitted to: Public Works Director (or designated representative) City of Tustin 300 Centennial Way Tustin, CA 92780 ~1,1~ -62- {2yofT/~l 8.3.2 Monthly Reports The information listed shall be the minimum reported: a) b) c) Solid Waste Collected by the Company for each month, sorted by type of service (Refuse, Recycling, Yard Waste, Rolloff) and type of Customer (Single-Family, Multi-Family, Commercial/Industrial) in tons, and the facilities where the tons were processed or disposed. Number of accounts by category shown for each month for customers billed by the Company; Materials Recovered. Statement showing kinds of material and quantity sold (in tons). 8.3.3 Quarterly Reports The information listed shall be the minimum reported: a) Complaint summary for the quarter summarized by nature of complaints on a compatible computer disc. Narrative stun_mary of problems encountered (including scavenging) and actions taken with recommendations for the City, as appropriate. Copies of promotional and public education materials sent during the quarter. Other information or reports that the City may reasonably request or require. b) c) a) 8.3.4 Annual Report The Annual Report is to be essentially in the form and content of thb monthly and quarterly reports combined, but shall also include: a) a complete inventory of equipment used to provide ail services; b) an account list of all multi-family and commercial customers billed by the Company, including servi'ce address, billing address, service levels (i.e. number of containers, container size, and frequency of service) and monthly rates; c) number of Carts in service by type of Customer (Single-Family, Multi-Family, Commercial/Industrial), service (Refuse, Recycling, Yard Waste, Roll-off) and Cart size (35, 64, or 96-gallon); and, -~3- ~ofT~s~ d) CERCLA Defense records required under Section 8.2.4. 8.3.5 AB 939 Reports City may, at City's option, request the Company to prepare and submit to the California Integrated Waste Management Board the annual AB 939 report. 8.3.6 Financial Report The City may, at the City's option, request the Company's annual audited financial reports/statements for the most recently completed fiscal year in connection with a rate adjustment, performance audit, billing audit, franchise fee audit, or verification of other information required under this Agreement. City Shall pay for the direct cost of reproduction of such copies. Financial statements shall include a supplemental combining schedule showing the Company's results of operations, including the specific revenues and expenses in connection with the operations provided for in this Agreement, separated from others included in such financial statements. The financial statements and footnotes shall be prepared in accordance with Generally Accepted Accounting Principles (GA_AP) and 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 of California as determined by the State of California Department of Consumer Affairs Board of Accountancy. The cost for preparation of the financial statements and audit shall be borne by the Company as a direct cost of sen, ice. In addition, the Company shall provide to the City the supplemental schedule on a compiled basis. The Company shall, in its agreement with the CPA preparing the aUdit above, have its CPA make available to the City (or the City's desig-nated representative) such CPA's wor 'king papers related to the audit. The cost, if any, incurred by the Company's CPA shall be included in the cost of the audit. At the City's requesf, the Company shall provide the Ci~ with copies of working papers or other documentation deemed relevant by the City relating to information shown in the disclosure letter. The disclosure letter shall be provided to the City. 8.4 Adverse Information · 8.5 A. Reporting Adverse Information. The Company shall provide the City three copies (one to the Public Works Director, one to the City Manager, and one to the City Attorney) of all reports, pleadings, applications, notifications, Notices of Violation, communications or other material relating specifically to the Company's performance of services pursuant to this Agreement, submitted by the Company to, or received by the ComPany from, the United States or California Environmental Protection Agency, the California Integrated Waste Management Board, the Securities and Exchange Commission or any other federal, state or local agency, including any federal or state court. Copies shall be submitted to the City simultaneously with the Company's filing or submission of such matters v¢ith said agencies. The Company's routLne correspondence to said agencies need not be routinely submitted to the Ci~,, but shah be made available to the City promptly upon the City's written request. B. Failure to Report. The refusal or failure of the Company to file any required reports, or to provide required information to the City, or the inclusion of any materially false or misleading statement or representation by the Company in such report shall be deemed a material breach of the Agreement as described in Section 11.1 and shall subject the Company to all remedies wkich are available to the City under the A~eement or otherwise. Right to Inspect Records The City shall have the right to inspect or review the payroll tax reports, specific documents or records required expressly or by inference pursuant to this Agreement, or any other similar records or reports of the Company or its related party entities that the City shall deem, in its sole discretion, necessary to evaluat~ annual reports, compensation applications provided for in this Agreement and the Company's performance provided for in this Agreement. -65- C~yo~Tus~ ARTICLE 9 INDEMNIFICATION, INSURANCE AND BOND 9.1 Indemnification The Company hereby agrees to and shall indemnify and hold harmless the City, its elected and appointed boards, commissions, officers, employees, and agents (collectively, Indem.n~tees) from and against a_ny and ail loss, liability, penalty, forfeiture, claim, demand, action, proceeding or suit in law or equity of any and every kind and description (including, but not limited to, injury to and death of any Person and damage to property, or for contribution' or indemrdty claimed by third parties) arising or resulting from and in any way connected with (1) the negligence or willful misconduct of the Company, its officers, employees, agents, Companies and/or Subcontractors in performing sen,ices under this Agreement; (2) the failure of the Company, its officers, employees, agents, Companies and/or Subcontractors to comply in all respects with the provisions of this Agreement, applicable laws (including, without limitation, the Environmental Laws), ordinances and regnalations, and/or applicable permits and licenses; (3) the acts of the Company, its officers, employees, agents, Companies and/or Subcontractors in performing sen,ices under this Agreement for which strict liability is imposed by laW(including, without limitation, the Environmental Laws). The foregoing indemnity shah apply regardless of whether such loss, liability, penalty, forfeiture, claim, demand, action, proceeding, suit, injury, death or damage is also caused in part by any of the Indemrdtees negligence, but shall not extend to matters resulting from the Indemrdtees sole or active negligence, willful misconduct or breach of this Agreement. The Company further agrees to and shall, upon demand of the City, at the Company's sole cost and expense, defend (with attorneys acceptable to the City) the Indemnitees against any claims, actions, suits in law or equity or other proceedings, whether judicial, quasi-judicial or administrative in nature, arising or resulting from any of the aforementioned events. The Company, upon demand of the City, made by and through the City Attorney, shall protect the City and appear in and defend the Indemnitees, in any claims or actions by third parties, whether judicial, administrative or otherwise, including, but not limited to disputes and lit/gat/on over the defirdtions of "Solid Waste" or "Recyclable Material" or the limits of 'the City's authority with respect to the grant of licenses, or agreements, exclusive or othenvise, asserting rights under the Dormant Commerce Clause or federal or state laws to provide Solid Waste services in the City. This provision shall survive the expiration of the period during which Collection services are to be provided under this Agreement. The CitT and the Company agree to confer following an), trial to decide jointly whether to appeal or to oppose any appeal. In the event the City and the Company jointly agree to appeal, or to oppose any appeal, the City and the Company agree to share equally the costs of appeals. Should either the City or the Company decide to appeal, or to oppose an appeal, and the other decide not to appeal, or to oppose an appeal, the parD, wkich decides to appeal, or to oppose an appeal, shall bear all fees and costs of the appeal or the opposition to the appeal. The Company's duty to indemnify and defend from the aforementioned events arising during the Term of the Agreement and as it may be extended shall survive the expiration or earlier termination of this Ag-reement. 9.2 Hazardous Substances Indemnification The Company shall defend with counsel reasonably acceptable to the City, indemrdfy, protect and hold harmless the Indernnitees from and against all claims, damages (including but not limited to special, consequential, natural resources and punitive damages), injuries, costs, (including without limit any and all response, remediation and removal costs), losses, demands, debts, liens, liabilities, causes of action, suits, legal or administrative proceedings, interest, fines, charges, penalties, attorney's fees for the adverse party and expenses (including without limit attorneys' and expert witness fees and costs incurred in connection with defending against any of the foregoing or in enforcing this indemnity), (collectively, "Damages'') of any kind whatsoever paid, incurred or suffered by, or asserted against, the Indemrdtees arising from or attributable to the acts or omissions of the Company, its officers, directors, employees, companies or agents, whether or not negligent or otherwise culpable, in connection with or related to the performance of this Agreement, including without limit Damages arising from or attributable to any repair, cleanup or detoxification, or preparation and implementation of any removal, remedial, response, closure or other plan (regardless of whether undertaken due to goverrunental action) concerning any Hazardous Substance, Hazardous Waste, Household Hazardous Waste, Solid Waste, and/or other waste that has been generated, collected, stored, transported, or disposed in the City. The foregoing indemnity is intended to oPerate as an agreement pursuant to ~107(e) of the -67- ~y~T~ 9.3 Comprehensive Environmental Response, Compensation and Liability Act, CERCLA, 42 USC. §9607(e) and California Health and Safety Code §25364, to defend, protect, hold harmless, and indemnify the Indemnitees from liability. This provision is in addition to all other provisions in this Agreement and shall survive the end of the term of this A~eement. The liability of the Company pursuant to this Section 9.2 is not limited to the limits of the policies of insurance provided pursuant to Section 9.4. AB 939 Indemnification ....- 9.4 The Company agrees to indemnify and hold harmless the City from and against all fines and/or penalties imposed by the California Integ-rated Waste Management Board in the event the source reduction and Recycling goals or any other requirement of AB 939 are not met by the City with respect to the waste stream Collected under this A~eement. The Company's indemnification of the City shall be subject to all of the following restrictions: (1) The Company's obligation to indemnify the City shall not be enforceable if the Board imposed penalty is based solely upon the failure of the City to establish and maintain a source reduction and recycling element pursuant to section 41000 et. seq., of the Public Resources Code. (2) No payment required or imposed pursuant to the Company's obligation to indemnify the City may exceed that portion of any penalty assessed by the Board against the City that was caused by the Company's breach or noncompliance of an express obligation or requirement. Further, the Company shall not be liable for the indemnity obligation to the extent that the Company's breach or noncompliance resulted from the action or failure to act of the City. Insurance The City does not, and shall not, waive any rights against the Company which it may have by reason of the aforesaid hold harmless agreements, because of acceptance by the City or the deposit with the City by the Company of the insurance policies described in this provision. A. Minimum Scope of Insurance. Coverage shall be at least as broad as: . The most reCent editions of Insurance Sen'ices Office Commercial General Liability coverage ("occurrence" form CG 0001). The most recent editions of Insurance Services Office form number CA 0001 covering Automobile Liability, code I "any auto" and endorsement CA 0025. . Workers' Compensation insurance as required by the Labor Code of the State of California and Employers Liability insurance. B. Minimum Limits of Insurance. The Company shall maintain in force for the term of this Ag-reement limits no less than: . Comprehensive General Liability: Three Million Dollars ($3,000,000) limit for each person, with Five Million Dollars ($5,000,000) limit per occurrence, for bodily injury, personal injury and property damage. . Automobile Liability: Five Million Dollars ($5,000,000) per accident for bodily injury and property damage. o Workers' Compensation and Employers Liabilii3.': Workers' compensation limits as required by the Labor Code of the State of California and Employers Liability limits of One Million Dollars ($1,000,000) per accident. C. Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the Indemnitees; or the Company shall procure a bond g-uaranteeing payment of losses and related investigations, claim administration and defense expenses in the amount of such deductibles or self-insured retentions. D. Other Insurance Provisions. The policies are to contain, or be'endorsed to contain, the following provisions: 1. General Liability and Automobile Liability Coverages a) The City of Tustin and its officers and employees are to be named as additional insureds as respects: liability arising out of activities performed by or on behalf of the Company; products and completed operations of the Company; premises owned, leased or used by the Company; or vehicles owned, leased, hired or borrowed by the Company. The coverage shall contain no limitations on the scope of protection afforded -69- b) to the City of Tustin, its elective and appointive boards, commissions, officials, employees, agents or volunteers. The Company's insurance coverage shall be primary insurance as respects the Indemnitees. ,amy insurance or self-insurance maintained by the City, its officials, elective and appointive boards, commissions, employees, agents or volunteers shall be excess of the Company's insurance and shall not contribute with it. c) .~ny failure to comply with reporting provisions of the policies shall not affect coverage provided to the Indemn/tees. d) Coverage shall state that the Company's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. Workers' Compensation and Employers Liability.Coverage - The insurer shall agee to waive ail rights of subrogation against the Indemnitees for losses arising from work performed by the Company for the City. . All Coverages - Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City. E. Acceptability of Insurers. The insurance policies required by this Section shall be issued by an insurance company or companies authorized to do business in the State of California and with a rating in the most recent edition of Best's Insurance Reports of size category VII or larger and a rating classification of A or better. F. Verification of Coverage. The. Company shall furnish the City with certificates of insurance and with original endorsements affecting coverage required by this clause. The certificates and endorsements for each insurance policy are to be siomaed by a Person authorized by that insurer to bind coverage on its behalf. The certificates and .endorsements are to be on forms provided by or acceptable to the City and are to be received and approved by the City before work commences. The City reserves the right to require complete, certified copies of all required insurance policies, at any time. Renewal certificates will be furnished periodically to the Civy to demonstrate maintenance of the required coverage throughout the Term. G. Companies and Subcontractors. The Company shall include all other companies and Subcontractors as insureds under its policies or shall furnish separate certificates and endorsements for each other company and Subcontractor. All coverages for companies and Subcontractors shall be subject to all of the requirements stated herein. · He Required Endorsements . . The Workers' Compensation policy shall contain an endorsement in substantially the following form: "Thirty (30) days prior written notice by certified mail, return receipt requested, shall be given to the City in the event of cancellation, reduction in coverage, or non-renewal of this policy. Such notice shall be sent to: Public Works Director City of TUstin 300 Centennial Way Tustin, CA 92780 The Public Liability policy shall contain endorsements in substantially the following form: a) "Thirty (30) days prior written notice shall be ~ven to the city in the event of cancellation, reduction in coverage, or non-renewal of this policy. Such notice shall be sent to: Public Works Director City of Tustin 300 Centennial Way Tustin, CA 92780 b) "The City, its officers, elective and appointive boards, commissions, employees, and agents are additional insureds on this policy." -71- ~,0fTa~t~ . c) "This policy shall be considered primary insurance as respects any other valid and collectible insurance maintained by the Cfi3,, including any self- insured retention or program of self-insurance, and any other such insurance shall be considered excess insurance only." d) "Inclusion of the City as an insured shall not affect the City's rights as respects any claim, demand, suit or judg-ment brought or recovered against the Company. This policy shah protect the Company and the City in the same manner as though a separate policy had been issued to each, but this shall not operate to increase the Company's liabilit3~ as set forth in the policy beyond the amount shown or to which the Company would have been liable if only one party had' been named as an insured." Other Insurance Requirements . In the event any sendces are delegated to another company or Subcontractor, the Company shall require such company or Subcontractor to provide statutory,- workers' compensation insurance and employer's liability insurance for aH of the other company or Subcontractor's employees engaged in the work in accordance with this Section 9.4. The liability 'insurance required by th.is Section 9.4 shall cover all company or Subcontractors or the company or Subcontractor must furnish evidence of insurance that meets all of the requirements of this Section 9.4. The Company shall comply with all requirements of the insurers issuing policies. The carrying of insurance shall not relieve the Company from any obligation under this Agreement. If any claim exceeding the amount of any deductibles or self-insured reserves is made by any third Person against the Company or any company or Subcontractor on account of any occurrence related to this Ageement, the Company shall promptly report the facts in writing to the insurance carrier and to the City. If the ComPany fails to procure and maintain any insurance required by this Ag-reement, the City may take out and maintain, at the Company's expense, such insurance as it may deem proper and deduct the cost thereof from any moneys due the Company. - 9.5 Faithful Performance Bond 9.6 Concurrently with execution of this Agreement, the Company shall deliver to the Ci~, a performance bond, from an admitted surety insurer, in the amount of $500,000, similar to the form provided in Exhibit 7, which secures the faithful performance of this A~eement, including, without limitation, payment of an), penalty and the funding of any work to cure a breach of this Ag-reement. The bond shall contain the original notarized signature of an authorized officer of the surety and affixed thereto shall be a certified and current copy of his power of attorney. The bond shall be unconditional and remain in force during the entire term of the A~eement and shall be null and void at the conclusion of the term of this A~eement only if the Company promptly and faith~gY performs all terms and conditions of this Agreement. Forfeiture of' Performance Bond 9.6.1 Partial Forfeiture In the event the Company shah for any reason become unable to, or fail in any v,,'ay to, perform as required by this Agreement, the City may declare a portion of the performance bond which is necessary to recompense and make whole the Cji3,, forfeited to the City. Upon partial forfeiture of the performance bond, the Company shall restore the performance bond to its face amount within 30 days of the City's declaration. 9.6.2 Full Forfeiture In the event the Company shall for any reason become unable to, or fail in any way to, perform as required by this Agreement, and the City determines to terminate this Ag'reement, as provided for, the full amount of the performance bond established pursuant to Section 9.5 shall forfeit to the Cit3,. ARTICLE 10 CITY'S RIGHT TO PERFORM SERVICE 10.1 General In addition to, but not in lieu of, any other rights or remedies City might have under this Agreement, at law or in equity, in the event that the Company, for any reason whatsoever, fails, refuses or is unable to Collect, Recycle, process, transport or dispose of any or all Solid Waste which it is required by this Agreement, at the ~-ne and in the manner provided in this Agreement, for a period of more than forty-eight (48) hours, and if, as a result thereof, Solid Waste should accumulate in the City to such an extent, Lq such a manner, or for such a tLme that the City should fihd that such accumulation endangers or menaces the public health, safety or welfare, then the City shall have the right, but not the obligation, upon notice to the Company during the period of such emergency as determined by the City, as hereinafter set forth, (1) to perform, or cause to' be performed, such sen;ices itself with its own or other personnel without liability to the Company; and/or (2) to take possession of any or ail of the Company's land, equipment and other property used or useful in the Collection and transportation of Solid Waste, and to use such property to Collect and transport any Solid Waste generated within the City which the Company would otherwise be obligated to Collect, transport and properly dispose of or process pursuant to this Agreement. Notice of the Company's failure, refusal or neglect to Collect, transport and properly dispose of or process Solid Waste may be given orally by telephone to the Company at its principal office and shall be effective immediately. Written confirmation of such oral notification shall be sent to the Company within twenty-four (24) hours of the oral notification. The Company further agrees that in such event: A. It will take direction from the City to effect the transfer of possession of equipment and property to the City for the City's use. B. It will, if the City so requests, keep in good repair and condition all of such equipment and property, provide all motor vehicles with fuel, oil and other service, and 10.2 10.3 provide such other service as ma); be necessary to maintain said property in operational condition. C. The City may immediately engage all or any personnel necessary or useful for the collection and transportation of Solid. Waste, including, if the City so desires, employees previously or then employed by the Company. The Company further agrees, if the City so requests, to furniSh the City the sen'ices of an), or all management or office Personnel employed by the Company whose sendces are necessa~, or useful for Solid Waste Collection, transportation, processing and disposal operations and for the billing and Collection of fees for these sendces. The City agees that it assumes complete responsibility for the proper and normal use of such equipment and facilities while in its possession. If the interruption or discontinuance in service is caused by any of the reasons listed in Section 11.4, the Cit-3, shall pay to the Company the reasonable rental value of the equipment and facilities, possession Of which is taken by the City, for the period of the City's possession, if any, which extends beyond the period of time for which the Company has rendered bills in advance of service, for the class of service involved. Temporary Possession of the Company's Property If the City suffers an interruption or discontinuance of sendce (including interruptions and discontinuance due to events described in Section 11.4), the City may take possession of and use all of the Company's property described above until other suitable a.rrangements can be made for the provision of Solid Waste Sen, ices which may include the grant of a Franchise to another waste hauling company. Billing and Compensation to the City During the City's Possession During such time that the City is providing Solid Waste sendces, as above provided, the Company shall bill and collect payment from all users of the above-mentioned services as described in Sec~on 5.1. The Company further agrees that, in such event, it shall reimburse the City for any and aH costs and expenses incurred by the City beyond that billed and received by th~ City in taking over possession of the above-mentioned equipment and property for Solid Waste service in such manner and to an extent as would otherwise be required of the Company under the terms of this Agreement. Such 10.4 10.5 10.6 reimbursement shall be made from time to time after submission by the City to the Company of each statement listing such costs and expenses, but in no event later than five (5) working days from and after each such submission. City's Right to Relinquish Possession It is further mutually agreed that the City ma}, at an}, time at its discretion relinquish possession of any or all of the above-mentioned property to the Company and thereupon demand that the Company resume the Solid Waste services as provided in this Agreement, whereupon the Company shall be bound to resume the same. City's Possession Not A Taking Except as otherwise expressly provided in the previous paragraph, the City's exercise of its rights under this Article 10 (1) does not constitute ata 'king of private property for which compensation must be paid; (2) will not create an}, liability on the part of the City to the Company; and (3) does not exempt the .Company from the indemn/ty provisions of Article 9, which are meant to extend to cirCUmstances arising under this Section, 'provided that the Company is not required to indemnify the City against claims and damages arising from the sole negligence of the City, its elective and appointive boards, commissions, officers, employees and agents in the operation Of Collection vehicles during the time the City has taken possession of such vehicles. Duration of the City's Possession The City's right pursuant to this Article to retain temporary possession of the Company's facilities and equipment, and to render Collection services, shall terminate when the City determines that such services can be resumed by the Company, or when the City no longer reasonably requires such property or equipment. In any case, the City has no obligation to maintain possession of the Company's property or equipment and/or continue its use for any period of time and may at any time, in its sole discretion, relinquish possession to the Company. ARTICLE 11 DEFAULT, REMEDIES AND LIQUIDATED DAMAGES 11.1 Events of Default All provisions of this Ageement to be performed by the Company are considered material. Each of the following shall constitute an event of default. A. Fraud or Deceit or Misrepresentation. If the Company engages in, or attempts to practice, any fraud or deceit upon the City or makes a misrepresentation regarding material information to the City. B. Insolvency or Bankruptcy. If the Company becomes h'tsolvent, unable, or umvilling to pay its debts, files a ban 'kruptcy petition or takes steps to liquidate its assets. C. Failure to Maintain Coverage. If the Company fails to provide or maintain in full force and effect the Workers' Compensation, liability, or indemnification coverage as required by this Ageement. D. Violations of Regulation. If the Company violates any orders or fi.lings of any reg-ulatory body having jurisdiction over the Company or City relative to this Ageement, provided that the Company may contest any such orders or filings by appropriate proceedings conducted in good faith, in which case no breach of the Franchise and this Agreement shall be deemed to have occurred. E. Failure to Perform. If the Company ceases to provide Collection, processing or Recycling services as required under this Agreement for a period of two (2) consecutive days or more, for any reason within the control of the Comp. any, including labor disputes. F. Failure to Pay. If the Company fails to make any payments required under this Ageement and/or refuses to provide the City, within ten (10) days of the demand therefor, with required information, reports, and/or records in a tkmely manner as provided for in the Agreement. G. Acts or Omissions. A_ny other act or omission by the Company which violates the terms, conditions, or requirements of this Agreement, the California Integrated Waste Management Act of 1989, any Environmental law as it may be amended from time to time, or any law, statute, ordinance, order, directive, rule, or regnalation issued thereunder and which is not corrected or remedied within the time set in the written notice of the violation or, if the Company cannot reasonably correct or remedy the breach within the time set forth in such notice, if the Company should fail to commence to correct or remedy such violation within the time set forth in such notice and diligently effect such correction or remedy thereafter. H. False or Misleading Statements..amy representation or disclosure made to the City by the Company in connection with or as an inducement to entering into this A~eement, or any future amendment to this A~eement, which proves to be false or misleading in any material respect as of the time such representation or disclosure is made, whether or not any such representation or disclosure appears as part of this Ag-reement. I. Attachment. There is a seizure of, attachment of, or levy on, the operating equipment of the Company, including without limits its equipment, maintenance or office facilities, or any part thereof. J. Suspension or Termination of Service. There is any termination or suspension of the transaction of business by the Company, including without limit, due to labor unrest including strike, work stoppage or slowdm~m, sick-out, picketing, or other concerted job action lasting more than two (2) consecutive days. K. Failure to Provide Assurance of Performance. If the Company fails to provide reasonable assurances of performance as required under Section 11.6. The Company shall be given forty-eight (48) hours from notification by the City to cure any default arising under subsections E, F, I, J and K provided, however, that the City shall not be obligated to provide the Company with a notice and cure opportunity if the Company has committed the same or similar breach within a twenty-f, our month period. 11.2 Right to Terminate Upon Default 11.3 Upon a default by the Company, the City shall have the right to terminate this Franchise and this Agreement upon a ten (10) days notice if the public health or safety is threatened, or otherwise a thirty (30) days notice, but without the need for any hearing, suit or legal action. The City's rights to terminate this Ag-reement, or to take possession of the Company's Facility are not exclusive, and the City's termination of this Agreement shall not constitute an elec~on of remedies. Instead, they shall be in addition to any and all other legal and equitable rights and remedies which the City may have. By virtue of the na~%tre of this Agreement, the urgency of timely continuous and high- quality sen:ice, the ~'ne required to effect alternative sen'ice, and the rights granted by the City to the Company, the remedy of damages for a breach hereof by the Company is inadequate and the City shall be entitled in injunctive relief. Liquidated Damages A. General. The City finds, and the Company agrees, that as of the time of the execution of this Ag-reement, it is impractical, if not impossible, to reasonably ascertain the extent of damages which shall be incurred by the City as a result of a breach by the Company of its obligations under this Agreement. The factors relating to the impracticability of ascertaining damages include, but are not limited to, the fact that: (i) substantial damage results to members of the public who are denied services or denied quality or reliable service; (ii) such breaches cause inconvenience, anxiety, frustration, and deprivation of the benefits of the Agreement to individual members of the general public for whose benefit this Ag-reement exists, in subjective ways and in varying degrees of intensity which are incapable of measurement in precise monetary terms; (iii) the services provided under this Agreement might be available at substantially lower costs than alternative services and the monetary loss resulting from denial of services or denial of quality or reliable services is impossible to calculate in precise monetary terms; and (iv) the termination of this Agreement for such breaches,' and other remedies are, at best, a means of furore correction and not remedies which make the public whole for past breaches. B. Service Performance Standards; Liquidated Damages for Failure to Meet Standards. The parties further ac'know]edge that consistent, reliable Solid Waste , Collection sen, ice is of utmost importance to the City and that the City has considered and relied on the Company's representations as to its quality of sen,ice commitment in awarding the Franchise to it. The parties further recognize that some quantified standards of performance are necessary and appropriate to ensure consistent and reliable service and performance. The parties further recognize that if the Company fails to achieve the performance standards, or fails to submit required documents in a timely manner, the City and its residents will suffer damages and that it is and will be impractical and extremely difficult to ascertain and determine the exact amount of damages which the City will sUffer. Therefore, without prejudice to the Cii3,'s right to treat such non-performance as an event of default under this Article 11, the parties agree that the following liquidated damage amounts represent a reasonable estimate of the amount of such damages considering all of the circumstances existing on the date of this Agreement, including the relationship of the sums to the range of harm to the City that reasonably could be anticipated and the anticipation that proof of actual damages would be costly or impractical. In placing their 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 the liquidated damage provisions at the time that the Ag-reement was made. Company City Initial Here Initial Here The Company agrees to pay (as liquidated damages and not as a penalty,) the amounts set forth below: 1. Collection Reliability. a) b) For each failure to commence sen, ice to a new customer account within seven (7) days after order, which exceed five (5) such failures annually: $150.00 For each failUre to Collect Solid Waste, which has been properly set out for Collection, from an established customer account, or accounts, on the scheduled Collection day and not Collected within the period described in -so- this Agreement which exceeds ten (20) such failures annually: $i50.00 c) For each failure to Collect Solid Waste, which has been properly set out for Collection, from the same customer on two (2) consecutive scheduled pickup days: 5150.00 Collection Ouality a) For each occurrence of damage to private'property which exceeds five (5) such occurrences annually: 5250.00 b) For each occurrence of failure to properly return empty Containers to avoid pedestrian or vehicular traffic impediments or to place Cans upright with lids secured (in areas where customers own their containers, if applicable) which exceeds ten (10) such occurrences annually: S150.00 e c) For each occurrence of excessive noise or discourteous behavior: $250.00 d) e) For each failure to clean up Solid Waste spilled from Solid Waste Containers which exceeds ten (10) such failures annually: $150.00 For each occurrence of Collecting Solid Waste during unauthorized hours which exceeds five (5) such occurrences annually: $250.00 For each failure to clean or replace commercial and industrial containers in accordance with Section 4.5.3.4 of this ag-reement which exceeds ten (1.0) such failures annually: $150.00 Customer Responsiveness a) For each failure to initially respond to a customer complaint within one (1) business day: $100.00 b) For each failure to process customer complaints to the City as required by Article 5 herein: $50.0.00 c) For each failure to carry out responsibilities for establishing service: -81- ~2ydT~n $500.00 d) For each failure to remove graffiti from containers, or to replace with containers bearing no graffiti, within twenty-four (24) hours of request from City or CustOmers: $150.00 4. Timeliness of Submissions to the City .am), report shall be considered late until such time as a correct and complete report is received by the City. For each calendar day a report is late, the daily liquidated damage amount shall be: a) Quarterly Reports: $100 per day b) .~rmual Reports: $350 per day 5. Accuracy of Billing a) Each customer invoice that is not prepared in accordance with the City's approved rate schedule: $250.00 . b) Each occurrence in which a sen, ice address is "double billed" with multiple invoices sent to different billing addresses (for examples, both a tenant and an off-site property owner are billed for service at the same location): 5250.00 I.,mplementation of Public Education Plan a) Each day past the agreed upon deadline that the Company fails to perform a task set forth in its public education plan. $100 per day .. Liquidated damages will only be assessed after the Company has been ~ven the opportunity but failed to rectify the damages as described in this Agreement. The City may determine the occurrence of events giving rise to liquidated damages through the observation of its o~m employees or representative or investigation of customer complaints. 11.4 Prior to assessing liquidated damages, the City shall give the Company notice of its intention to do so. The notice will include a brief description of the incident(s)/non- performance. The Company ma}, review (and make copies at its own expense) all non- confidential information in the possession of the City relating to incident(s)/non- performance. The Company max,,, within ten (10) days after receiving the notice, request a meeting with the City Manager or his or her designee. The Company may present evidence in writing and through testimony of its employees and others relevant to the incident(s)/non-performance. The City Manager or his or her designee will provide the Company with a written explanation of his or her determination on each incident(s)/non-performance prior to authorizing the assessment of liquidated damages. The decision of the City Manager or his designee shall be final. C. Amount. The City ma), assess liquidated damages for each calendar day or event, as appropriate, that the Company is determined to be liable in accordance with this Agreement. D. Timing of Payment. The Company shall pay any liquidated damages assessed by the City within ten (10) days after they are assessed. If they are not paid within the ten (10) day period, the City may proceed against the performance bond required by the Ageement or order the termination of the Franchise granted by this A~eement, or exercise any other right or remedy available to City under this Agreement or at law or in equity, or any combination of these remedies. Excuse from Performance The parties Shall be excused from performing their respective obligations hereunder in the event they are prevented from so performing by reason of floods, earthquakes, other natural disasters, war, civil insurrection, riotS, acts of any government (including judicial action), and other similar catastrophic events which are beyond the control of and not the fault of the party claiming excuse from performance hereunder. Labor unrest, including but not limited to strike, work stoppage or slowdowm, sick-out, picketing~ or other concerted job action conducted by the Company's employees or directed at the Company is not an excuse from performance and the Company shall be obligated to continue to provide service notwithstanding the occurrence of any or all of such events. ~1, l~az2 -83- C~ry~T~ 11.5 The part), claiming excuse from performance shall, within two (2) days after such part3.' has notice of such cause, We the other par~' notice of the facts constituting such cause and asserting its claim to excuse under this Section. The interruption or discontinuance of the Company's ser~,ices caused by one or more of the events excused shall not constitute a default by the Company under this Agreement. Notwithstanding the foregoing, however, if the Company is excused from performing its obligations hereunder for any of the causes listed in this Section for a period of seven (7) days or more, the Ci~' shall nevertheless have the right, in its sole discretion, to ter- minate this Agreement by giving ten (10) days' notice, in which case the provisions relative to taking possession of the Company's land, equipment and other property and engaging the Company's Personnel in Article l0 and this Article 11 will apply. Arbitration An), dispute arising out of or relating to this A~eement, which dispute involves claims or controversies having no monetary value, or are in an amount or amotmts, if combined, not exceeding 525,000, shall be first mediated between the parties. The par~, ma 'king demand for mediation shag select a panel of three (3) mediators from those mediators listed and approved by the local Superior Court of jurisdiction, and the party not selecting the panel shall choose one (1) of the listed mediators who shall serve in that capacity. The parties shall share equally in the cost and expense of the mediation. Any dispute arising out of or relating to this Ag-reement, which dispute involves claims or controversies, having a monetary value in an amount or amounts, if combined, not exceeding $25,000, which dispute was not resolved by mediation as required herein, shah be decided by arbitration in accordance with the commercial rules of the American Arbitration Association then pertaining, unless the parties agree otherwise and consent, M writing, to a different method of dispute resolution, including mediation or judicial arbitration. Any dispute arising out of or relating to this A~eement, which dispute involves claims or controversies in an amount or amounts, if combined, exceeding $25,000, shall not involve arbitration, or any other method of dispute resolution, unless the parties agree otherwise and consent, in writing, but shall instead be brou. ght in a court of competent jurisdiction in the County of Orange, State of California. ~1, ~ 999 -8~ Oi~ dTu~(n Venue for any action, including those actions subject to arbitration, shall be Orange County. Company hereby expressly waives any right to remove any such action to a County other than Orange Count), otherwise provided by California Code of CMl Code of Civil Procedure Section 394. Notice of the demand for arbitration is to be filed in writing with the other party to this Agreement and with the American Arbitration Association. The demand is to be made within a reasonable period of time after the claim, dispute, or other matter in controversy has arisen. In no event, however, is the demand for arbitration to be made after the date when institution of legal or equitable proceedings based on such claim, dispute or other matter in controversy would be barred by the applicable statute of limitations. 11.6 Any award rendered by the arbitrator shall be final and judgTnent'may be entered upon it in accordance wi~ applicable law in any court having jurisdiction thereof. Assurance of Performance The City may, at its option and in addition to ali other remedies it may have, demand fi-om the Company reasonable assurances of timely and proper performance of this Ag-reement, in such form and substance as the City may require. If the Company fails or refuses to provide satisfactory assurances of timely and proper performance in the form and by the date required by the City, such failure or refusal shall be an event of default. ARTICLE 12 OTHER AGREEMENTS OF THE PARTIES 12.1 Relationship of Parties 12.2 12.3 The parties intend that the Company shall perform the sendces required by this Agreement as mn independent Company engaged by the City and not as an officer or employee of the City nor as a partner of or joint venture with the City. No employee or agent or Company shag be or shall be deemed to be an employee or agent of the City. Except as expressly provided herein, the Company. shall have the exclusive control over the manner and means of conducting the Solid Waste Collection sendces performed under this Agreement, and all Person~ performing such sendces. The Company shall be solely responsible for the acts and omissions of its officers, employees, CompanieS, Subcontractors, Affiliates and agents. Neither the Company nor its officers, employees, Companies, Subcontractors, Affiliates and agents shall obtain any rights to retirement benefits, workers' compensation benefits, or any other benefits which accrue to the City employees by virtue of their employment with the Cit-y. Compliance with Law In providing the services required under this Agreement, the Company shall at all times, at its sole cost, comply with all applicable laws and regulations of the United States, the State of California, and local agencies. The City shall comply with ail applicable regulations promulgated by federal, state, regional or local adrninistrative and regulatory agencies, now in force and as they may be enacted, issued or amended during the Term. Governing Law This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of California. 12.4 Jurisdiction 12.5 An), lawsuits between the parties arising out of this Ag-reement shall be brought and concluded in the courts of the State of California, which shall have exclusive jurisdiction over such lawsuits. With respect to venue, the parties agree that this Agreement is m'ade in and will be performed in Orange Count3,. Assignment Except as may be provided for in Article 10 (the City's Right to Perform Service), neither party shall assig-n its rights, nor delegate, subcontract or otherwise transfer its obligations under this A~eement to any other Person without the prior written consent of the other party. Any such assig-nment made without the consent of the other party shall be void and the attempted assigTu'nent shall constitute a material breach of this A~eement. . For purposes of this Section when used in reference to the Company, "assi~mament" shall include, but not be limited to (i) a sale, exchange or other transfer of substantially all of the Company's assets dedicated to sen, ice under this Agreement to a third party; (ii) a sale, exchange or other transfer of outstanding common stock of the Company to a third party provided said sale, exchange or transfer may result in a change of control of the Company; (iii) any dissolution, reorganization, consolidation, merger, re-capitalization, stock issuance or re-issuance, voting trust, pooling agreement, escrow arrangement, liquidation or other transaction to which results in a change of Ownership or control of the Company; (iv) any assigTkment by operation of law, including insolvency or bankruptcy, making assigxu'nent for the benefit of creditors, writ of attachment for an execution being levied against this Agreement, appointment of a receiver taking possession of th~ Company's property, or transfer occurring in the event of a probate proceeding; and (v) any combination of the foregoing (whether or not in related or contemporaneous transactions) which has the effect of any such transfer or Change of Ownership, or change of control of the Company. The Company ac-knowledges that this Agreement involved rendering a vital service to the City's residents and businesses, and that the City has selected the Company to perform the services specified herein based on (1) the Company's experience, skill and reputation for conducting its operations in a safe, effective and responsible fashion, at all times in keeping with applicable Environmental Laws, regnalations and best Solid Waste management practices, and (2) the Company's financial resources to maintain the required equipment and to support its indemnity obligations to the Cit-), under this Ag-reement. The City has relied on each of these factors, among others, in choosing the Company to perform the sen;ices to be rendered by the Company under this Ag-reement. If the Company reques, ts the City's consideration of and consent to an assigTu'nent, the Cit3, may deny or approve such request in its complete discretion. No request by the Company for consent to an asSignment need be considered by the City un_less and until · the Company has met the following requirements: a) b) c) The Company shall undertake to pay the City its reasonable expenses for attorney's fees and investigation costs necessary to investigate the suitability of any proposed assignee, and to review and finalize any documentation required as a condition for approving any such assignment; The Company shall furnish the City with audited financial statements of the proposed assig-nee's operations for the immediately preceding three (3) operating years; The Company shall furnish the City with satisfactory proof: (i) that the proposed assig'nee has at least ten (10) years of Solid Waste management experience on a scale equal to or exceeding the sale of operations conducted by the Company under this Ag-reement; (ii) that in the last fiVe (5) years, the proposed assig-nee has not suffered any significant citations or other censure from any federal, state or local agency having jurisdiction over its Solid Waste management operations due to any sigTtfficant failure to comply with state, federal or local Environmental Laws and that the assignee has provided the City with a complete list of such citations and censures; (iii) that the proposed assignee has at all times conducted its operations in an environmentally safe and conscientious fashion; (iv) that the proposed assignee conducts its Solid Waste management practices in accordance with sound Solid Waste management practices in full compliance with all federal, state and local laws reg-ulating the collection and Disposal of Solid Waste including Hazardous Substances; and, (v) of any other information required by 12.6 12.7 the Git-5, to ensure the proposed assivmaee can fulfill the Terms of this Agreement in a timely, safe and effective manner. Under no circumstances shall the City be obliged to consider any proposed assiocmment by the City if the Company is in default at any time during the period of consideration. Affiliated Companies The Company's accounting records shall be maintained on a basis showing the results of the Company's operations under this Ag-reement separately from operations in other locations, as if the Company were an independent entity providing service only to the CIO,. The costs and revenues associated with providing service to the City shah not be combined, consolidated or in any other way incorporated with those of other operations conducted by the Company in other locations, or with those of an Affiliate. If the Company enters into an), financial transactions with a Related Party Entity for the provision of labor, equipment, supplies, services, capital, etc., related to the furnishing of service under this Agreement, that relationship shall be disclosed to the CIO,, and in the financial reports submitted to the City. In such event, the City's rights to inspect records, and obtain financial data shall extend to such Related Party Entity or entities. An), application for a change of ownership or a franchise transfer shall be made in a manner prescribed by the City Manager. The'application shall include a transfer fee in an amount to be set by a resolution of the City Council, to cover the reasonable costs of all direct and indirect administrative expenses of the City, including, without limitation, consultants and attorneys, necessary to analyze the application and to reimburse the City for all its direct and indirect expenses. The applicant shall pay such invoices prior to any authorized change of ownership or franchise transfer becoming effective. Contracting or Subcontracting The Company shall not engage any companies or Subcontractors for Collection, transfer, processing, Recycling or Disposal of Solid Waste without the prior written consent of the City. 12.8 Binding on Assigns 12.9 12.10 12.11 12.12 12.13 The provisions of this Agreement shall inure to the benefit of and be binding on the permitted assigns of the parties.' Transition to the Next Company If the transition of services to another company occurs through expiration of term, default and termination, or otherwise, the Company will cooperate with the City and subsequent company(ies) to assist in an orderly transition which will include, but not be limited to, the Company providing route lists and billing information. Parties in Interest Nothing in this Ag-reement, whether express or implied, is intended to confer an), rights on .any Persons other than the parties to it and their representatives, successors and permitted assig-ns. Waiver The waiver' by either party of any breach or violation of any provisions of this Ageement shall not be deemed to be a waiver of any breach or violation of any other provision nor of any subsequent breach of violation of the same or any other provision. The subsequent acceptance-by either party of any moneys which become due hereunder shall not be deemed to be a waiver of any pre-existing or concurrent breach or violation by the other part3, of any provision of this Agreement. The Company's Investigation The Company has made an independent investigation (satisfactory to it) of the conditions and circumstances surrounding the Ageement and the work to be performed by it. Condemnation The City fully reserves the rights to acquire the Company's property utilized in the performance of th/s Ageement, by purchase or through the exercise of the right of eminent domain. This provision is additive, and not intended to alter the rights of the parties set forth in Article 10. 12.14 Notice - All notices, demands, requests, bids, proposals, approvals, consents and other communications which this Agreement requires, authorizes or contemplates shall be in writing.and shall either be personally delivered to a representative of the parties at the address below or be deposited in the United States mail, first class postage prepaid, addressed as follows: If to the City: Public Works Director City of Tustin 300 Centenn/al Way Tustin, CA 92780 If to the Company: 12.15 The address to which communications may be delivered may be changed from time to time by a writ-ten notice given in accordance with this Section. Notice shall be deemed given on the day it is personally delivered or, if mailed, three days from the date it is deposited in the mail. Representatives of the Parties References in this A~eement to the "City" shall mean the City Council and all actions to be taken by the City shall be taken by the City Council except as provided below. The City Council may delegate, in writing, authority tothe City Manager, and/or to other City employees and may permit such employees, in mm, to delegate in writing some or all of such authority to subordinate employees. The Company may rely upon actions taken by such delegates if they are within the scope of the authority properly delegated to them. The Company shall, by the effective date, designate in writing a responsible officer who shall serve as the representative of the Company in aH matters related to the Agreement and shall inform the City in writing of such designation and of any limitations upon his or her authority to bind the Company. Tl~e City ma), rely upon action taken by such desig-nated representative as actions of the Company unless they are outside the scope of the authority delegated to him/her by the Company as communicated to the CIO,. 12.16 City Free to Negotiate with Third Parties Notwithstanding the exclusive nature of the Franchise, the City may investigate all options for the Collection, transporting, Recycling, processing and Disposal of Solid Waste at any time prior to the expiration of the Term. Without limiting the generality of the foregoing, the City may solicit bids from the Company and from third parties for the provision of Collection sen'ices, Disposal services, Recycling services, Yard Waste services and processing, and any combination thereof, and may negotiate and execute agreements for such services which will take effect upon the expiration or earlier termLnation under Section 11.1 (Events of Default) of this Agreement. 12.17 12.18 Compliance with Municipal Code The Company shall comply with those provisions of the municipal code of the City which are applicable, and with any and ail amendments to such applicable provisions during the term of this Ageement. The Company and any subcontractors must maintain a current City business license during the term of this Agreement. Privacy .. . The Company shall strictly observe and protect the rights of privacy of customers. Information identif'ying individual customers or the composition or contents of a customer's waste stream shall not be revealed to any Person, governmental unit, private agency, or company, unless upon the authority of a court of.law, by statute, or upon valid authorization of the customer. This provision shall not be construed to preclude the Company from preparing, participating in, or assisting in the preparation of waste characterization studies or waste stream analyses which may be required by AB 939. This provision shall not apply to reports or records provided to City pursuant to this Ageement so long as City maintains reports or records with customer identification or confidential information in accordance with this Section 12.19, in which case this Section 12.19 shall apply to City in the same manner to which it applies to Company. 12.19 Cooperation Following Termination At the end of the Term or in the event this Agreement is terminated for cause prior to the end of the Term, the Company covenants to cooperate fully with the City and any subsequent company to assure a smooth transition of solid waste management services. The Company's cooperation shall include, but not be limited to, providing operating records needed to service all properties covered by this Agreement. The failure to cooperate with City following termination shall be conclusively presumed to be grounds for specific performance of this covenant and/or other equitable relief necessary to enforce this covenant. 12.20 Compliance with Immigration Laws. The Company ag-rees that, in the performance of this Agreement, it will comply with ail immi~ation laws. 12.21 Proprietary Information, Public Records The City acknowledges that a number of the records and reports of the Company are proprietary and confidential. The Company is obligated to permit the City inspection of its records on demand and to provide copies to the City where requested. The City will endeavor to maintain the confidentiality of all proprietary information provided by the Company. Notwithstanding the foregoing, and notwithstanding Section 12.19 (as it applies to City), any documents provided by the Company to the City that are public records may be disclosed pursuant to a proper public records request. 12.22 Guarantee of Contractor's Performance Pursuant to a guarantee in substantially the form attached as Exhibit 6, , a corporation which owns all of the issued and outstanding common stock of · has ageed to guarantee the Company's performance of this A~eement. The Guarantee is being provided concurrently with the Company's execution of this Ageement. 12.23 Attorney's Fees In any action or proceeding to enforce or interpret any of the terms or conditions of thZs Ageement the prevailing party shall be entitled to an award to attorney's fees in the amount reasonably incurred in the prosecution or defense of such action. The term "prevailing part)," shall mean the party entitled to recover costs of suit, upon the conclusion of the matter, in accordance with the laws of the State of California. ARTICLE 13 MISCELLANEOUS AGREEMENTS 13.1 13.2 13.3 13.4 13.5 Entire Agreement This Agreement, including the Exhibits, represents the full and entire Agreement between the parties with respect to the matters covered herein. No verbal agreement or conversation with any office, agent, or employee of the City, either before, during, or after the execution of this contract, shall affect or modify any of the terms or obligations herein contained nor such verbal agreement or conversation entitle the Company to any additional payment whatsoever under the terms of this contract. Section Headings The article headings and section headings in this Agreement are for convenience of reference only and are not intended to be used in the construction of this Agreement nor to alter or affect any of its provisions. References to Laws and Other Agreements All references in this Ag-reement to laws shall be understood to inClude such laws as they may be subsequently amended or recodified, unless otherwise specifically · provided. This Agreement supersedes any and all ag-reements heretofore entered into by the parties and the City. Interpretation This Agreement, including the extxibits attached hereto, shall be interpreted and construed reasonably and neither for nor against either party, regardless of the degree to which either party participated in its drafting. Agreement This Agreement may not be modified or amended in any respect except by a writing sig-ned by the parties. ~ 1,1,Z~ -95- C3yofTLS~h 13.6 Severability 13.7 If any non-material provision of this Agreement is for any reason deemed to be invalid and unenforceable, the invalidity or tmenforceability of such provision shall not affect any of the remaining provisions of this Agreement which shall be enforced as if such invalid or unenforceable provision had not been contained herein. Exhibits 13.8 Each of the Exhibits identified in this Agreement is attached hereto and incorporated herein and made a part hereof by this reference. Non-Waiver Provision '..'.7..-.- Failure of either part3, to exercise any of the remedies set forth herein within the time periods provided for shall not constitute a waiver of any rights of that party with regard to Sat failure to perform or subsequent failures to performing whether determined to be a breach, excused performance or unexcused defaults by the other part3,. IN WITNESS WHE~OF, the City and the Company have executed this Agreement as of the day and 3,ear first above written. CITY OF TUSTIN ATTEST: By CITY CLERK MAYOR, CITY OF TUSTIINT APPROVED AS TO FORM: ("CO v[PANT') City Attorney By: Name: Title: By: EXHIBIT 1 COMPANY'S BID EXHIBIT 2 COLLECTION SERXrlCES FROM CITY FACILITIES AT NO ADDITIONAL CHARGE , .~ :-t,~-, · ~,~-- -~ .~. -- ~:~, ,~, - ~: ~ ~',~ . '- ~x.,~ x ,~.~,,~v.- - ~, ~ , "~ ~ "~ ..... ~:.~ .~:.:~:~. ~T~,~ '~:~-~.~,,~.'.~: :~* ~:~. ~, .~'~.-. ~ ~'~'~ ~-.~ .~ ~"~?-'~ ~,~' ' City Hall/Civic Center 300 Centennial Way 4-yard 3 2 Mixed Waste 4-yard 1 1 Mixed Paper Field ~'ices 14~ ~,ice Road Ward 2 2 ~xed Add mix~ paper and Maintenance FaciliD, Waste ~een waste re,cling to 4~yard 2 ~ call Mixed current se~'ices Waste ~vard 2 On call Green · I Waste Tus~n Area Senior 200 S. "C" S~eet ~yard 1 3 ~xed Center Waste Tus6n Fa~lv and You~ 14722 Newport Ave Ward 1 3 Mixed Center Waste Water ~'ices 255 E. Main S~eet ~yard 1 2 ~xed Add cons~ucfion and Maintenance FaciliD' Waste demoli6on pick up of as~stos cement pipe C&D Debris spoils. May be l~ated wi~ Field Se~'ices yard. . , · , ,---.,?~:.~' · s~ ':'-:'. ~ '. ~.' ..... -~ ~-~,,~ ........ :" '~.~. -~d.";;, .~'~st~':,~.' · ~,, '-.~:~ -'~"~., * . '.::x*,~ :.:: g?~:-~,' s.k,:.4 -.¢-~?~,--;. ;~:,~'.-:.;~:- ~ ......... ~...:~¢ -.:.:~ - -:,-~ ,~ .~ ~: .~' ~ -.~ ..: Columbus-Tusfin Park 14702 Prospect &yard 1 3 Mixed ~raste Columbus-Tustin Park 175v2 Beneta Way ~)'ard 1 2 Mixed Gymnasium Waste Cedar Grove 11385 Pioneer Road ~yard I 2 Mixed Increases to 3 times per Waste week in the Summer Heritage 2350 Kinsman Circle ~yard I 2 ~xed Increases to 3 times per Waste week in the Summer Tusfin Spor~ Park ~ 12850 Robinson Road ~7'ard 1 3 Waste * Data provided by Waste Management. The City, does not assume any responsibility for the accuracy of the reported information. 'J-ne successful bidder will be required to provide services to all existing and future City facilities as requested by the CID,. EXHIBIT 3 PUBLIC EDUCATION PLAN (to be prepared by Company) EXHIBIT 4 INITIAL RATES EXHIBIT 5 RATE ADJUSTMENT FORMULA Qya~T~h EXHIBIT 5A Example Rate Adjustment- Customers Billed By the City on the Tax Roi1 Step One: Determine disposal expense and sen'ice revenue as a percent of actual rate revenue Revenue Component Annual Amount (a) Percent of Rate R, evenue $ Single Famih' Rate Revenue Less: Single Famih' Refuse Disposal Expense Sinzle Famih' Service Revenue 2,940,000 7~0.000 2,200,000 100.0% 74.8°,; Step Two: Calculate percentage change in adjustment factors Adjustment Factor Old New Percent Change Disposal Gate Fee per Ton Producer Price tndex $22.00 130.0 $~.00 155.0 Step Three. Calculate weighted p6rcentage change in single family rates 0.0% ,,.3.. IO Components of Actual Revenue Component Weight (b) Percent Change (c) Weighted Rate Adjustment Refuse Disposal Service Total 100.0% 0.0% 3.°% N/A 0.0% Step Four:. Apply weighted percentage change to single family rates Service One Refuse Ca, t, an)' size Current Monthly Rate (d) S 12.00 Weighted Rate Adjustment (e) '3 Oo/ ~ /o Adjusted Monthly Rate 12.35 (a) For the twelve months ending on the date six months prior to the effective date of the rate adjustment. For example, for a rate adjustment effective Jul)- 1, 2002, the revenue used should be for the twelve months ending December 31, 2001 From percent of revenue in Step One (c) From percent change in Step Two (d) The weighted rate adjustment should be applied to the total rate, including franchise fee portion of the rate (e) From weighted rate adjustment in Step Three EXHIBIT 5B Example Rate Adjustment- Customers Billed By the Company (Except Rolloff) Step One: Deduct franchise fees from gross rate revenue Revenue Component (including Franchise Fees) Annual Amount (a) $ Actual Gross Commercial and MFR Rate Revenue Actual Commercial and hiFR Franchise Fees Actual Corm-ner6al and MFR Rate Revenue Net of Franchise Fees 4,000,000 80.000 3,920.000 Percent of Gross Revenue Including Franchise Fees 100.0% 9S.0% Step Two: Determine disposal expense and service revenue as .a percent of total actual rate revenue Revenue Component (net of Franchise Fees) Annual Amount (a) ] Percent of Rate Revenue Net of Franchise Fees Actual Commer~al and b,C,:R Bin Revenue Net of Franchise Fees (b) $ 3,920,000 100.0% Less: Actual Commercial and ]~:R Bin Refuse 1.0,q0.000 25.5% Actual Commercial and lvL!:R Bin Se~-ice Revenue S 2.920,000 74.5°.,;, Step Three: Calculate percentage change in adjustment factors Adiustment Factor Oid I' New Percent Change Disposal Gate Fee per Ton $ 22.00 [ $ "_2.00 0.0% _ . Producer Price Index 130.0 - 135.0 3.9% Step Four:. Calculate weighted percentage change in commercial and MFR Bin rates Components of Act-ual Revenue Component Weight (c) Percent Change (d) Weighted Rate Adjustment Refuse Disposal .gem'ice Total 25.5% 74.5% 100.0% 0.0% ~ ~% N/A 0.0% 2.9% ~ OO' Step Five: Apply weighted percentage change to commercial and MFR Bin rates Service Current Monthly Rate Weighted Rate Adjusted Monthly Rate (e) Adjustment (f) ea. 3 yard Bin once per week $ 9Z13 2.9% $ 94.80 ea. 3 yard Bin twice per week 148.52 2.9% 152.83 ') o' ea. 3 yard Bin three times per week 204.93 _9 ,o 210.87 ea. 3 yard Bin four times per week 259.25 2.9% 266.77 ea. 3 yard Bin five times per week 315.69 2.9% 324.85 -) ot ea. 3 yard Bin six times ver week $ 3~.08 _.9 ,o $ 382.87 (a) For the t~-elve months ending on the date six month.~ prior to the effective date of the rate adjustment. For example, for a rate adjustment 'effective Jutv 1, 2002, the revenue used should be for the twelve months ending December 31, 2001 (b) From Step (She above. Note that basks for determining percent of revenue is different from that in Step One (c) From percent of revenue net of franchise fees in Step Two (d) From percent change in Step Three (e) The weighted rate adjustment should be applied to the total rate, including franchkge fee portion of the rate (ir) From weighted rate adjustment in Step Four ~1,1~ 5 - 2 Ctryct'Tus~ EXHIBIT SC Example Rate Adjustment- Rolloff Rates Step One: Calculate percentage change in Producer Price Index Adjustment Factor Old Producer Price Index 130.0 New Percent Change 1.35.0 3.9% Step TwO: Apply percentage change in Producer Price Index to Sen, ice Portion of rolloff rates Service Current Rate Monthly Rate Adjustment (a) Adjusted Rate Standard Rolloff charge per load (b) $ 100.00 3.9% $ 103.90 Compactor charge per load 150.00 3.9% 155.85 Deliver5, or relocation charge $ 50.00 3.9% $ 51.95 ... . . (a) Percent change in PPI (b) Excluding disposal. Disposal is billed at actual cost based on the gate rate per ton at the Orange County Landfills multiplied by the number of tons. :" ~1,1~'5~ 5 - 3 C::IycfTustil EXHIBIT 6 CORPORATE GUARANTY Guaranty THIS GUARANTY (the "Guaranty) is Wen as of the ... da3, of ,2000. THIS GUAP-~-XNTY is made with reference to the following facts and circumstances: A. . , hereinafter ("O~mer") is a corporation organized under the laws of the State of California, all of the issued and outstanding stock of which is o~med by , which is owned by (Guarantor)~ Guarantor owns ail of the issued and outstanding stock of B. Owmer and the City of Tustin ("the City") have negotiated an Agreement for Collection,.Processing, and Disposal of Solid Waste dated as of , (hereinafter ,,Agreement,,). A copy of this Agreement is attached hereto. C. It is a requirement of the Agreement, and a condition to the City entering into the Agreement, that Guarantor g-uaranty Owner's performance of the Agreement. D. Guarantor is providing this Guaranty to induce the City to enter into the Agreement. NOW, THEREFORE, in consideration of the foregoing, Guarantor agrees as follows: 1. Guaranty of the Agreement. Guarantor hereby irrevocably and unconditionally guarantees to the City the complete and timely performance, satisfaction and observation by Owner of each and every term and condition of the Ag-reement which Owner is required to perform, satisfy or observe. In the event that Owner fails to perform, satisfy Or observe any of the terms and conditions of the A~eement, Guarantor will promptly and fully perform, satisfy or observe them in the place of the Owner or cause them to be performed, satisfied or observed. Guarantor hereby g'uarantees payment to the City of any damages, costs or expenses which might become recoverable by the City from Owner due to its breach of the Agreement. 6 - 1 Cl~y, dT/a~ 2. Guarantor's Obligations Are Absolute. The obligations of the Guarantor · hereunder are direct, immediate, absolute, continuingl unconditional and unlimited, and with respect to any payment obligation of Owner under the Agreement, shall constitute a g-uarantee of payment and not of collection, and are not conditional upon the genuineness, validity, regularity or enforceability of the Agreement. In any action brought against the Guarantor to enforce, or for damages for breach of, its obligations thereunder, the Guarantor shall be entitled to all defenses, if an3,, that would be available to the Owner in an action to enforce, or for damages for breach of, the A~eement (other than discharge of, or stay of proceedings to enforce, obligations under the Aoo-reement under bankruptcy law). .... 3. Waivers. Except as provided herein the Guarantor shall have no right to terminate this Guaran~3, or to be released, relieved, exonerated or discharged from its obligations under it for any reason whatsoever, including, without limitation: (1) the insolvency, bankruptcy, reorganization or cessation.of existence of the Owner; (2) the actual or purported rejection by a trustee in bankruptcy of the Agreement, or any limitation on an5, claim in bankruptcy resulting from the actual or purported termination of the Ageement; (3) any waiver with respect to any of the obligations of the Ageement guaranteed hereunder or the impairment or suspension of any of the City's rights or remedies against the Owner; or (4) any merger or consolidation of the Owner with any other corporation, or any sale, lease or transfer of any or all the assets of the OXYner. Without limiting the generality of the foregoing, Guarantor hereby waives the rights and benefits under California Civil Code Section 2819. The Guarantor hereby waives any and all benefits and defenses under California Civil Code Section 2846, 2849, and 2850, including without limitation, the right to require the City to (a) proceed against Owner, (b) proceed against or exhaust any security or collateral the City may hold now or hereafter hold, or (c) pursue any other right or remedy for Guarantor's benefit, and agrees that the City may proceed against Guarantor for the obligations ~cmaranteed herein without taking any action against Owner or any other g-uarantor or pledgor and without proceeding against or exhausting any security or collateral the City may hold now or hereafter hold. City may unqualifiedly exercise in its sole discretion any or all rights and remedies available to it against Owner or any other guarantor or pledgor without impairing the City's rights and remedies in enforcing this Guaranty, ~1,1~ 6 - 2 C3ya'TLs~ The Guarantor hereby waives and agrees to waive at an),' future time at the request of the City to the extent now or then permitted by applicable law, an), and all rights which the Guarantor may have or which at any time hereafter ma); be conferred upon it, by statute, reg-ulation or otherwise, to avoid an).' of its obligations under, or to terminate, cancel, quit or surrender this Guaranty. Without limiting the generality of the foregoing, it is a~eed that the occurrence of any one or more of the following shall not affect the liability of the Guarantor hereunder: (a) at any time or from time to time, without notice the Guarantor, performance or compliance herewith is waived; (b) an), other of any provision of its Agreement indenmification with respect to Owner's obligations under the Agreement or any security therefore is released or exchanged in whole or in part or otherwise dealt with; or (c) any assivmunent of the Agreement is effected which does not require the City's approval. The Guarantor hereby expressly waives, diligence, presentment, demand for payment or performance, protest and all notices whatsoever, including, but not limited to, notices of non-payment or non-performance, notices of protest, notices of any breach or default, and notices of acceptance of this Guaranty. If all or any portion of the obligations gnaaranteed hereunder are paid or performed, Guarantor's obligat-ions hereunder shall continue and remain in full force and effect in the event that all or any part of such payment or performance is avoided or recovered directly or indirectly from the City as a preference, fraudulent transfer or °thenvise, irrespective of (a) any notice of revocation given by Guarantor or Owner prior to such avoidance or recovery, and (b) payment in full of any obligations then outstanding. 4. Term. This Guaranty is not limited to any period of time, but shah continue in full force and effect until all of the terms and conditions of the Agreement have been fully performed or otherwise discharged and Guarantor shall remain fully responsible under this Guaranty without regard to the acceptance by the City of any performance bond or other collateral to assure the performance of Owner's obligations under the Ag-reement. Guarantor shall not be released of its obligations hereunder so long as there is any claim by the City against Owner arising out of the Agreement based on Owner's failure to perform which has not been settled or discharged. 5. No Waivers. No delay on the part of the CiD, in exercising an5, rights under this Guaranty or failure to exercise such rights shall operate as a waiver of such rights. No 6- 3 ~r~s~ notice to or demand on Guarantor shall be a waiver of any obligation of Guarantor or right of the City to take other or further action without notice or demand. No modification or waiver of any of the provisions of this Guaranty shall be effective unless it is in writing and sig-ned by the City and by Guarantor, nor shall any waiver be effective except in the specific instance or matter for which it is ~ven. 6. Attorney's' Fees. In addition to the amounts guaranteed under this Guarani', Guarantor agrees in the event of Guaran~,'s breach of its obligations including to pay reasonable attorney's fees and all other reasonable costs and expenses i~curred by the Ci~, in enforcing this Guaranty, or in an), act-ion or proceeding arising out of or relating to this Guaranty, including an), action instituted to determine the respective rights and obligations of the parties hereunder. 7. Governing Law: Jurisdiction. This Guaranty is and shall be deemed to be a contract entered into in and pursuant to the laws of the State of California and shall be governed and construed in accordance with the laws of California without regard to its cont'licts of laws, rules for all purposes including, but not limited to, matters of. construction, validity and performance.. Guarantor agrees that any action brought by the City to e~orce this Guaranty ma), be brought in any court of the State of California and Guarantor consents to personal jurisdiction over it by such courts. Guarantor appoints the following person as its agents for sen, ice of process in California: With a cOpy by certified mail to: 8. Severability. If any portion of this Guaranty is held to be invalid or unenforceable, such invalidity will have not effect upon the remaining portions of this GUarani, which shall be severable and continue in full force and effect. 9. Binding On Successors. ~is Guaranty shall inure to the benefit of the City and its successors and shall be binding upon Guarantor and its successors, including transferee(s) of substantially all of its assets and its shareholder(s) in the event of its dissolution or insolvency. 10. Authority. Guarantor represents and warrants that it has the corporate power and authority to give this Guaranty, that its execution of this Guaranty has been authorized by all necessary action under its Article of Incorporation and By-Laws, and that the person sig-ning this Guaranty on its behalf has the authority to do so. 11. Notices. Notice shall be given in writing, deposited in the U.S. mail, registered or certified, first class postage prepaid, addressed as follows: To the City: Public Works Director CiB~ of Tustin 300 Centennial Way Tustin, CA 92780 With a copy to the City coUnsel atthe same address. To the Guarantor: 'By: By: (title) (title) 6-5 C~y~'T~ EXHIBIT 7 COMPANY'S FAITHFUL PERFORMANCE BOND KNOW ALL MEN BY THESE PRESENTS: . . . · That , a California , as PRINCIPAL, and ~ , a Corporation organized and doing business by virtue of the laws of the State of California, and duly licensed for the purpose of ma 'k/rig, g-uaranteeing, or becoming sole surety upon bonds or undertakings required or authorized by the laws of the State of California, as SURETY, are held and firmly bound to City,, hereinafter called oBLIGEE, in the penal sum of ($ .) lawful money of the United States, for the payment of which, well and truly to be made, we and each of us hereby bind ourselves, and our and each of our heirs, executors, admin/strators, successors, and assig-ns, jointly and severally, firmly by these presents. NOW, THEREFORE, THE CONDITION OF 'i'H~S OBLIGATION IS SUCH THAT: WHEREAS, the above bounden PRINCIPAL has entered into a contract, entitled "INTEGRATED SOLD WASTE MANAGEM:ENT SERVICES" with City, to do and perform the following work, to wit: Collect, Process and Dispose of Solid Waste generated within City, in accordance with the contract. NOW, THEREFORE, if the above bounden PRINCIPAL shall well and truly perform, or cause to be performed each and all of the requirements and obligations of said contract to be performed by said PRINCIPAL, as in said contract set forth, then this BOND shall be null and void; otherwise it will remain in full force and effect. And the said Surety, for value received hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of the contract or to the work to be performed thereunder or the specifications accompanying the same shall in any wise affect its obligations on this BOND, and it does hereby waive notice of any such change, extension of time, alteration or addition to the terms of the contract or to the work or to the specifications. 7- 1 CXye/rus~ IN WITNESS WHEREOF, said PRINCIPAL and said SURETY have caused these presents to be duly signed and sealed this DAY OF ,2000. a California Corporation SURETY (PR_L-NCIPAL) (SEAL) (ATTORNEY IN FACT) (SEAL) 7-2 C2ydT~ EXHIBIT 8 NOTARY CERTIFICATION STATE OF CALIFORNIA) COUNTY OF ) ss: On , , before me, the undersig-ned, a Notary Public in and for the State of Caiifornia;ipersonally appeared , known to me to be the of the Company that executed the with&n instrument on behalf of the Company ~herein named, and acknoxVledged to me that such the Company executed the same. EN I'¥TTNESS WHEREOF, I have hereunto set my hand and affixed my official seal in the Count, of this day of ,. My Commission Expires: Notary Public