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Home My WebLink AboutAGENDA 08-05-93 AGENDA CITY COUNCIL SPECIAL MEETI~ CITY OF TUSTIN AUGUST 5, 1993 - 7:00 P.M. le II. III. IV. CALL TO ORDER - PLEDGE OF ALLEGIANCE- INVOCATION ROLL CALL' PUBLIC HEARING (CONTINUED) I · RESOLUTION NO. 93-78 ADOPTING THE 1993-94 SOLID WASTE COLLECTION ASSESSMENT REPORT, AND CONSIDERATION OF A PROPOSED AMENDMENT OF THE AGREEMENT WITH GREAT WESTERN RECLAMATION Staff has been presented with a proposal by Great Western Reclamation that offers to reduce the 1993-94 solid waste collection rates for residential and commercial can · units and freeze commercial bin service in consideration of a two-year extension of the current agreement, including elimination of the current option to extend the agreement. Recommendation: Pleasure of the City Council. ADJOURNMENT The City Council has scheduled a Budget Workshop on August 16, 1993, at 6:00 p.m., and the next regular meeting of the City Council is scheduled for Monday, August 16, 1993, 7:00 p.m., at the Tustin Area Senior Center. Council Agenda Special Meeting August 5, 1993 AGENDA__ DATE: AUGUST 3, 1993 PUBLIC HEARING NO. 1 8-5-93 Inter-Com FROM: RONAL~~N~, DIRECTOR OF FINANCE SUBJECT: BOLID WASTE COLLECTION ~BBEBBMENT REPORT Attached is the staff report from the August 2nd City Council meeting. The following changes have been included in the report. ® The closing paragraph on page 4 of the staff report has been changed to include the revised contract ending date of June 30, 2000. · A copy of the letter from Great Western Reclamation dated August 2, 1993 notifying us of the error addressed above has been included. 3. The missing Exhibit "F" has been inserted in its proper order. RAN:is Attachment a: ~ded. Qwr DATE: AUGUST 3; 1993 Inter-Com TO: WlLLI~iA. HUBTON, CZTY~AGER FROM: RO10.LD ~. IO, ULT, DIRECTOR OF FIIO, NCE SUBJEC~ REBOLUTION NO. 93-?8 ~MX)~ING THE 1993-94 SOLID ~TABTE. COLLECTION ~%BSE~SNENT REPORT ~ CONSIDERATION OF ~ PROPOSED ~"e__m~__~7~_ OF _?~R ~RR~NT WITH G~T ~ESTERN _R~_C~TION RECOMMENDATION= Pleasure of the City Council. FISCAL IMPACT: No fiscal impact on the City. DISCUSSION= Staff has been presented with a proposal by Great Western Reclamation (GWR) that offers to reduce the 1993-94 solid waste collection rates for residential and commercial can units and freeze commercial bin service in consideration of a two year extension of the current Agreement (including elimination of the current option to extend the Agreement). This discussion will first address the potential increase in the rates under the current contract and then, follow with a brief explanation of the proposed contract amendment. The rates for solid waste collection are made up of three components; the collection charge, the disposal charge and the Material Recovery Facility (MRF) charge. Pursuant to the Franchise Agreement, each component is allowed to adjust annually based on the weighted average of seven separate cost categories which are verified by the Federal Bureau of Labor Statistics. See Exhibit "F" for the current adjustment calculations. The disposal charge is a direct pass through of the County land fill charges. For the second year in a row the County has not raised their land fill disposal charges so that there will not be an increase in that component this year. Page 2 Solid Waste August 3, 1993 The MRF charge is allowed to adjust annually by the Consumer Price Index (CPI), with a four percent minimum and seven percent maximum. See exhibit "A" for the current years adjustments. MRF and land fill charges are combined under the heading of disposal as shown on Exhibit "E" which details all the adjusted rates for 1993-94. Based on these rate components, the residential collection charge could increase by $0.09 per unit per month and the disposal charge could increase by $0.44 per unit per month for a total increase of $0.53 per month, or $6.36 for the fiscal year 1993-94. In addition, this year there will be an increase in the disposal charge of $0.28 per unit per month to compensate GWR for an increase in the actual tonnage collected and processed at the MRF. This brings the monthly increase to $0.81 per unit. ($9.72 for the year), which is an increase of 7.4 percent. We are again proposing an additional $0.10 per unit to offset collection delinquencies. Since residential disposal charges are collected through the property tax bill, it is necessary to have funds available to cover the estimated amount of delinquencies due to non-payment of property taxes. The $0.10 should generate about $8,400 per year to help offset delinquencies which are currently running at about two percent. In subsequent years as we recover the delinquencies, this amount will be adjusted based on the status of total collections. In prior years we have also collected $0.15 per unit for the public information cost of the Cityts recycling program as required by AB 939 and detailed in the City's Source and Recovery Recycling Element (SRRE). We have sufficient funds available to continue this program through 1993-94 so we will not be adding this to the rate for the coming year. As of June 30, 1993 the available credit from last years refund from GWR relating to the actual tonnage collected is $114,733. Based on the current residential unit count, a credit of $1.31 per month may be applied to each residential and commercial can unit for the 1993-94 fiscal year. As an option, the City Council could apply the credit over two or three years. The following are the monthly credits given one, two or three years: Page 3 Solid Waste August 3, 1993 CURRENT YR I YR 2 YR 3 OPTION i $1.31 OPTION 2 $0.70 $0.61 OPTION 3 $0.70 $0.31 $0.30 GWR PROPOSED AMENDMENT OPTION i $1.31 opTroN 2 $0.65 OPTION 3 $0.44 $0.65 $0.44 $0.43 The amounts shown above vary between the current agreement and GWRts proposed amendment because the base collection rate affects the amount of credit that can be given in any one year. GREAT NEBTERN RECL~-MATION ALTERI~ATIVE PROPOSAL= Per the attached letter, Great Western Reclamation is proposing to reduce the residential and commercial can collection rate by $0.05 per month effective July 1, 1993 and freeze commercial bin rates at the 1992-93 rates for one year. This offer is predicated upon amending the contract to eliminate the present "evergreen" automatic annual rollover provision, which always leaves five years remaining on the contract term and substituting in its place a fixed term of seven years (no rollovers). Also, attached is a summary of a monthly residential refuse rate survey recently completed by Orange County Integrated Waste Management. The results of this survey indicate that all of the alternative rates will fall below the County wide median and average rate. Page 4 Solid Waste August 3, 1993 The City Council's actions would be: 1.) to amend the Solid Waste Collection Assessment Report to conform with whichever rate alternative is selected and adopt Resolution #93-78; 2.) to approve amendment of the Agreement for Collection and Transportation of Solid Waste Refuse Produced or Accumulated in the City of Tustin by and between the City of Tustin and Great Western Reclamation, Inc. dated December 19, 1988, as amended June 19, 1991 and September 15, 1992, as proposed by the letter from Great Western Reclamation, Inc. to the City of Tustin dated July 19, 1993, except with the term of the contract to end on June 30, 2000, and authorize the Mayor and City Clerk to execute such amendment in form approved by the City Manager and City Attorney. Director of Finance RAN:is Attachments a: prpos ~ 9~. gwr Great Western Reclamation, inc~-- 1800 S. Grand Avenue Santa Aha, California 92705 714/558-7761 A Waste Management Company August 2, 1993 Mr. William A. Huston City Manager City of Tustin 15222 Del Arno Avenue Tustin, CA 92680 RECEIVED AU6 - 2 IgllB ADMINISTRATIO N Dear Bill: It has come to my attention that on page 2 of my letter to you of July 18, 1993, there is an error in the first paragraph. The cited date should be June 30, 2000, not June 30, 2001. We simply made a mistake in calculating the time frame involved. I apologize for any confusion this error may have caused. David Ross Division President and General Manager VIA FAX CC: James G. Rourke, Esq. City Attorney Great Western Reclamation, Inc. 1800 S. Grand Avenue Santa Ana, California 92705 714/558-7761 A Was:e Management Company July 19, 1993 Mr. Bill Huston City Manager CITY OF TUSTIN 15222 Del Amo Avenue Tustin, CA 92680 Re: City of Tustin Solid waste Collection and Recycling Agreements Dear Bill: Pursuant to our conversations in the last few days, I would like to summarize the proposal now being made by Great Western Reclamation, Inc. ("GW") to the City of Tustin regarding an amendment to its current residential and commercial collection and recycling agreements. GW is making the following proposal: A. RESIDENTIAL: The current service rate is $10.66 per month. This is now broken down as follows: $5.34 - hauling $5.32 - disposal GW was entitled on July 1, 1993 to a $0.09 increase in the hauling rate and a $0.44 increase in the disposal rate by reason of the Consumer Price Index adjustments in the current agreements. In addition, GW is entitled to a $0.28 increase in the combined rate by reason of actual tonnage adjustments for..the past year. The net result is that GW is entitled to increase its rate from $10.66 to $11.47 per month as of July 1, 1993. GW is proposing, instead, to reduce the total rate to $10.61, which is a savings of $0.86 per house per month. This 7.5% rate reduction will cost GW $6,022 per month in gross revenues the first year or a total of $294,400 over five years. B. COMMERCIAL: In return for the same two year term extension referred to above, GW is proposing to freeze all of its current commercial service rates at their existing levels for an additional year, i.e., until June 30, 1994. This freeze will cost GW $7,560 per month in gross revenues the first year or a total of $504,300 over five years. Mr. Bill Huston Page 2 In return for the rate conceSsions described above, GW is asking that the existing five year contract term be extended an additional two years for a total of seven years, ending on June 30, 2001. The current evergreen language and provision is to be eliminated. Fn/e pages of schedules illustrating and justifying the above summary have already been submitted to the City of Tustin via Ron Nault, the Finance Director. Ron has already reviewed and approved those numbers. A copy of those schedules is enclosed herewith for your edification. If you need any other information, please do not hesitate to call me. Sincerely, David W. Ross Division President and General Manager rc~:huston4.1tr EXHIBIT A CITY OF TUSTIN MRF PROCESSING COSTS JULY 1, 1993 COSTS Handling and Hauling to Landfill Disposal at Landfill Processing for Recovery Total Cost SAVINGS Materials Revenue Diverted Disposal Cost Total Savings Net Cost ~37.96 Current July I st Proposed . S/Ton' Increase S/i'on $15.80 $0.63 * $16.43 $22.75 $0.00 ** $22.75 $15.60 ~0.62 * $16.22 .~54.15 ~;1.25 ~;SS.40 ($10.50) $0.00 ($5.69) $0.00 {$16.19) ~0.00 ~1.25 ($10.50) ($5.69) {$16.19) ~;39.21 * - Per section 5 of the Amendment to the agreement, Contractor is allowed an adjustment to the MRF charges for changes in the Consumer Price Index for all Urban Consumers, for Los Angeles - Anaheim - Riverside CMSA. The April - April index is 2.8%. Since this falls below the contract floor increase of 4%, we will use 4%. ** -No Disposal increase has been imposed by the County of Orange. CITY OF TUSTIN PROPOSED RESIDENTIAL RATE JULY 1 ,'~1~93 EXHIBIT B RATE CALCULATION HAULING CHARGE DISPOSAL CHARGE ADJUSTED DISPOSAL CHARGE CURRENT PROPOSED INCREASF_J S/UNIT/MO S/UNIT/MO DECREASE 5.34 5.43 * 0.09 5.32 5.76 ** 0.44 N/A 0.28 *** 0.28 TOTAL RATE 10.66 11.47 0.81 * $5.34 X 1.0171(MODIFIED CPI) SEE ATTACHED 'COMPUTATION OF TRASH COLLECTION RATES' ** 67.8 (ACTUAL POUNDS PER UNIT PER WEEK)X 52 WKS/12 MOS./2000 LBS. X $39.21 (PROPOSED RATE/TON) SEE ATTACHED EXHIBIT C 'ANALYSIS OF DISPOSAL CHARGES' *** ADJUSTED DISPOSAL CHARGE FOR JULY 1992 - JUNE 1993 SEE ATTACHED EXHIBIT D 'DISPOSAL RATE ADJUSTMENT' CITY OF TUSTIN ANALYSIS OF DISPOSAL CHARGE ACTUAL RESIDENTIAL VOLUME AND UNITS JULY 1 993 EXHIBIT C MONTH AND YEAR July 1992 August 1992 September 1992 October 1992 November 1992 December 1992 January 1993 February 1993 March 1993 April 1993 May 1993 MRF Bulky Item Total Total Tonnaqe Tonnacle Tonnage Units 1,234.15 (9.65) 1,224.50 7,031 963.45 0.00 963.45 7,048 935.22 0.00 935.22 7,052 1,092.15 0.00 1,092.15 7,062 1,030.15 0.00 1,030.15 7,068 1,011.98 (2.72) 1,009.26 7,077 1,112.56 (9.79) 1,102.77 7,086 901.14 (5.07) 896.07 7,093 992.22 (18.91) 973.31 7,104 1,253.58 (6.65) 1,246.93 7,117 986.28 (14.22) 972.06 7,130 Totals 11,51 2.88 i~67.01 ) 11,445.87. 77,868 Average 1,046.63 ~6.09) 1,040.53 7,078.91 Tons/Unit Pounds/Uni~ Per Month Per Week 0.174 80.4 0.137 63.1 0.133 61.2 0.155 71.4 0.146 67.3 0.143 65.8 0.156 71.8 0.126 58.3 0.137 63.2 0.175 80.9 0.136 62.9 0.147 67.8 0.147 67.8 Pounds/Unit/Week 67.8 CITY OF TUSTIN DISPOSAL RATE ADJUSTMENT JULY 1993 New Disposal Rate Charqe Add: Charge for Disposal Volume Increase during July 1, 1992 - June 30, 1993 residential waste generation Actual Pounds/unit/week(JULY 1991 - JUNE 1992) Actual Pounds/unit/week(JULY 1992 - MAY 1993) Undercharge of Waste Generation Charge for Disposal Volume Increase during 1992-93 (3.4 lbs. x 4.33 weeks/2,000 lbs/ton x $37.96/ton) Adjusted Disposal Charge for July 1, 1993 64.4 lbs. 67.8 lbs. 3.4 lbs. EXHIBIT D $5.79 $0.28 ~;6.07 CITY OF TUSTIN ADJUST TRASH COLLECTION RATES JULY 1, 1993 EXHIBIT E ADJUSTMENT FACTORS COLL 1.0171 DISPOSAL 1.0329 CURRENT RATES COLL- DIS- CATEGORY ECTION POSAL TOTAL PROPOSED RATES COLL- ECTION DIS- POSAL TOTAL 2 YD lX 43.37 16.45 59.82 2X 63.98 32.90 96.88 3X 84.53 49.35 133.88 4X 105.15 65.80 170.95 5X 125.71 82.25 207.96 6X 146.28 98.69 244.97 3 YD lX 58.35 24.68 . 83.03 2X 83.72 49.35 133.07 3X 109.13 74.02 183.15 4X 132.59 98.69 231.28 5X 158.00 123.37 281.37 6X 183.36 148.05 331.41 4 YD lX 61.02 32.90 93.92 2X 91.92 65.80 157.72 3X 122.38 98.69 221.07 4X 153.11 131.59 284.70 5X 183.85 164.49 348.34 6X 214.55 197.49 412.04 44.11 65.08 85.98 106.95 127.86 148.78 59.35 85.15 111.00 134.86 160.70 186.50 62.06 93.49 124.47 155.73 187.00 218.22 16.99 33.98 50.98 67.97 84.96 101.94 25.49 50.98 76.46 101.94 127.43 152.93 33.98 67.97 101.94 135.92 169.91 203.99 61.10 99.06 136.95 174.92 212.82 250.72 84.84 136.13 187.46 236.80 288.14 339.42 96.05 161.46 226.41 291.65 356.90 422.22 RESIDENTIAL 5.34 5.32 10.66 COMMERCIAL CAN** 5.76 5.32 11.08 5.43 5.85 6.04 6.04 11.47 11.89 * The 1.0329 is the increase in the MRF processing cost divided by the current S/to n ($1.25/$37.96) ** The commercial can rate was adjusted in accordance with the methOd used for residential. The disposal continues to match the residential rate and the · collection program of the charge remains at $.42 above the residential rate. CiTY OF TUSTIN COMPUTATION OF TRASH GOLLEGTION RATES . J~ld~ :1 , 1993 EXHIBIT r · c~'r~GqRW souRcE TIME ~ Pl~on NEW : CONTRAC'I __L w,~.l..~m' ~ AVERAGE HOURLY EARNINGS/ I. OOA, I. 8~ WAG£8 GAsoLINE/ cpi (UNAD,J) US ~ AViA AU. URBAH CONaUMER8 (BS4701A) MOTOR TRUCKS/ PPI CODE 141104 GENERAL PURPOSE MACH & EQUIP/ PPI CODE 114 AUTOMOTIVE PART8 · EQUIP/ PPI OODE 1 FABRICATED METAL PRODUCT8 PPI CODE ALL OTHER CPI LA/LONG BEACH/ANAHEIM (UNADJUSTED) ALL URBAN CONSUMERS, ALL ITEM8 APR 1002JOa 11 .OS 1 1.0S O.O~,, 0.~300 0.0011~ APR $ 902/93 04.8 98.2 3.6% O.OO00 0.32~ APR 1902/03 12~.8 133.2 8.4% 0,08S 0.22e~ APR 1992JO$ 130.0 151.S o APR 1002/00 126.2 t 28.5 .1.2% 0.1:S25 0.1~ · 1 .B~,. 0.022S 0.04% APR 1092/93 122.2 122.8 0.3% 0.02 0.01 APR 1992/93 145.a0 140.90 TOTAL 0,8400 O.g6~. '~ .000 1.71~, 8OURCE: U8 DEFT OF LABOR; BUREAU OF LABOR STATISTIC5 213-252-7521 TABLE OF RATE OPTIONS Residential Current Proposed Monthly Monthly Current Monthly Commercial Can $10.66 Hauler $11.47 $11.08 $0.10 Delinquent $0.10 $0.10 $0.15 AB 939 $0.00 $0.15 Proposed Monthly[ Hauler Delinquent AB 939 $11.89 $O. lO $o.oo $10.91 $11.57 $11.33 $11.99 Residential Current Proposed Monthly Monthly ICurrent Monthly Commercial Can $10.66 Hauler $10.61 $11.08 $0.10 Delinquent $0.10 $0.10 $0.15 AB 939 $0.00 $0.15 Proposed Monthly Hauler Delinquent AB 939 $11.03 $0.10 $o.oo $10.91 $10.71 $11.33 $11.13 NOTE: The available crexh't of $I 14,733 will be applied to either option 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN, CALTFORNIA, ADOPTED PURSUANT TO THE PROVISIONS OF SECTION $473 ET SEQo OF THE HEALTH AND SAFETY CODE OF THE STATE OF CALIFORNIA· APPROVING AND ADOPTING A REPORT RELATIVE TO PARCELS OF REAL PROPERTY RECEIVING SOLID WASTE COLLECTION SERVICES · DETERMINING THE CHARGES FOR SOLID WASTE COLLECTION TO BE ASSESSED AGAINST THE RESPECTIVE LOTS OR PARCELS OF L~ND AS THEY APPEAR ON THE CURRENT ASSESSMENT ROLL. The City Council of the City of Tustin does hereby resolve as follows: 1. That proceedings were duly instituted, conducted and completed pursuant to provisions of Section 5473 et seq. of the Health and Safety Code of the State of California. A. A written report dated July, 1993 containing a description of each parcel of real property receiving solid waste collection services and facilities and the amount of the charge proposed to be levied upon each parcel for the collection of solid waste for the fiscal year 1993-94 was prepared and filed with the City Clerk of the City of Tustin on July 15, 1993. B. That a public hearing to hear and consider all objections or protests, if any, to the aforesaid report and proposed charges was duly set for August 2, 1993 at 7:00 o'clock p.m. in the Senior Center of the City of Tustin at 200 South "C" Street, Tustin, California. C. Said hearing was dUly noticed as required by law, by publication once each week for two successive weeks on July 22, and July 29, 1993 in the Tustin News, a newspaper of general circulation printed and published in the City of Tustin. D. At the aforesaid time and place the duly noticed hearing was held and all persons who were present were heard and all comments,~..objections and protests to the aforesaid report and proposed charges were duly heard and considered by the City Council. E. The charges proposed in the aforesaid report are fair and reasonable, are commensurate with the services provided, and the charge therefore should properly be collected on the tax roll in the same manner, by the same persons and at the same time as, together with and not separately from, general taxes. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 Page 2 Solid Waste Resolution #93-78 2. The City Council hereby elects to have the charges set forth in the aforesaid report collected on the tax roll in the same manner, by the same persons, at the same time as, and together with and not separately from its general taxes and hereby authorizes that such charges be collected on the tax roll, as all prescribed to the provisions of Health and Safety Code Section 5473 et seq. 3. The resolution shall be effective following its adoption by a two-thirds vote of the members of the City Council and shall remain in force and effect and said charges shall be collected in the manner as aforesaid for the year 1993-94 and for each subsequent year as authorized by the hereinabove referenced sections of the Health and Safety Code. 4. The City Clerk is authorized and directed to forthwith file a certified copy of this Resolution with the Auditor of the County of Orange, together with a copy of the hereinabove- described report, and a statement endorsed thereon over her signature that the said report has been finally adopted by the City Council of the City of Tustin. PASSED AND ADOPTED at a regular meeting of the City CounCil'of the City of Tustin, California, held on the 2nd day of Auqust , 1993. Jim Potts, Mayor ATTEST: Mary Wynn City Clerk City of Tustin a:so[ idwst.chg San Juan Capistrano 15.80 *** Brea 14.49 Orange County Unincorporated 13.96 La Palma 13.87 Anaheim 13.86 Lake Forest 13.78 Dana Point 13.25 Laguna Niguel 13.25 San Clemente 13.25 Villa Park 12.85 Yorba Linda 12.85 Seal Beach 12.75 Mission Viejo 12.61 Huntington Bch 12.00 Fountain Valley 12.00 Placentia 11.98 Los Alamitos ~t- 11.96 Cypress 11.87 Stanton 11.85 Garden Grove 11.22 Newport Beach 11.02 ** La Habra 10.56 Orange 10.50 Buena Park 10.12 Irvine 9.92 Fullerton 9.75 Laguna Beach 9.39 Santa Ana 8.70 Westminster 8.16 * Costa Mesa 6.68 * · County Average $11.81 Median Rate $12.00 * Special District Tax Rate ** Internal Charge to Enterprise Fund *** Rate for Single Family Residential Source: Orange County Integrated Waste Management Survey 7/93 F~nance Department City Of Tustin 15222 Del Arno Avenue Tus~in. CA 92680 f7 ~ 4 ~ 54.4 NOTICE OF FILING OF REPORT AND OF PUBLIC HEARING Pursuant to the provisions of Section 5473, et seq. of the Health and Safety COde of.the State of California, the City Council of the City of Tustin has authorized and directed the preparation of a written report containing a description of each parcel of real property receiving solid waste collection se.~vices and facilities and the amount of the charge proposed to be levied upon each parcel for the collection of solid waste for the fiscal year 1993-1994, and the City Council has set August 2, 1993 at 7 o'clock p.m. in the Tustin Area Senior Center, located at 200 South "C" Street, Tustin, California, as the time and place when the City Council will hear and consider all objections or protests, if any, to the aforesaid report and proposed charges. If ~he report is adopted by the City Council, the charges will be placed on the tax roll and collected in the same manner, by the same persons and at the same time as general property taxes. A copy of said report is on file in the office of the City Clerk and is avai'abie for inspection during regular business hours. The City Council has authorized and directed the City Clerk to publish this notice o~,ce a week for =wo successive weeks, on July 22, and July 29, 19R3 in the Tustin News, a newspaper of general circulation printed and published in the City of Tustin. Dated: . 3~~--~ j-- a:hearin~.DuD 1993 .,,~34a~_y --. Wynn, City Clerk City cf T'ustin