HomeMy WebLinkAboutAgenda Report - April 2, 2008 K-01AGENDA ITEM 14W 1
CITY OF LODI
COUNCJL COMMUNICATION
7M
AGENDA TITLE: Approve Business Points for Solid Waste Franchise Renewal
MEETING DATE: April 2,2008
PREPARED BY: Public Works Director
RECOMMENDED ACTION: Approve business points described below for the solid waste
franchise renewal.
BACKGROUND INFORMATION: In December 2007, the City Council directed staff to attempt to
negotiate a renewal of the solid waste franchise with Central Valley
Waste Services (CVWS). The intent was to do so before the
required decision point (renew or bid) in the franchise agreement as
this would give the City the most leverage in negotiating a favorable extension and still leave time to have
a request for proposals prepared if the decision was not to renew.
Staff has met with CVWS representatives on several occasionswith the following goals:
• Work with the existing franchise agreement framework
No major changes in the basic services (i.e., the three -cart system) and the rate structure
• Keep the rates where they are now; i.e., no increase
Improve services to both individual customers for special trash removal, such as improvements to
the voucher system, and the citizenry as a whole in terms of keeping the City clean
With these goals in mind, the parties have prepared the following renewal business points. Staff is
seeking Council direction on these points prior to drafting the actual renewal language.
1) Street sweeping — CWVS will be responsiblefor street sweeping at the same frequencies (or
better) being done now by the City. This includes downtown sweeping, similar to what the City
had done before reductions in service due to budget constraints. This also includes winter leaf
pickup, which would be done with additional sweepers; hence one change from past practices is
that customers would be asked to not pile leaves.
2) Public on -street trash container service — CVWS will service these containers (mainly in the
Downtown) at no additional charge.
3) City service — CVWS will service the trash containers/bins at City facilities, including parks, at no
additional charge.
4) Billing service — CVWS will continue to reimburse the City for a share of billing expenses and the
amount will be indexed the same as the annual CPI rate adjustments. For the past several years,
the amount has been fixed.
5) Hazardous waste — CWVS will host quarterly electronic/universal waste and annual household
hazardous waste collection events at their Turner Road facility or other Lodi location.
APPROVED:
BlaiMQi6, City Manager
K\WP%Solid Waste\CFranchlseRenewal doc
3!2012008
Approve Business Points for Solid Waste Franchise Renewal
April 2, 2008
Page 2
6) Annual rate adjustments- will be the same as the annual change in the Consumer Price Index.
This is a very slight increase in future adjustments, as they are now at 80% of the CPI. The
difference typically has been fractions of a percent.
7) Renewal term — is another seven years with one CVWS option to renewfor an additional seven
years. Staff recommendsthat the new term start in 2008.
8) Technical ordinance revisions — CVWS has asked for clarification of some definitions of service
classes.
9) Compactor rates — CVWS has asked for a new rate for servicing certain types of large trash
compactors that are labor intensive.
The provisions for public services (1, 2 and 3 above) would include provisions for growth.
The business points will need to be drafted into detailed terms in an amendment to the franchise
agreement, including performance criteria and measures as appropriate. Pending Council direction, staff
will attempt to have this done and brought back to the City Council for approval before FY 08/09.
FISCAL IMPACT: The proposed terms will have a positive fiscal impact on the City and its
taxpayers in both direct cost savings and indirect improvements in service.
The direct cost of trash service that would now be included in the franchise
is approximately $70,000 per year. Indirect savings that would improve
service will result from staff time now being utilized for street sweeping and downtown and park trash
collection. Also, there will be cost savings resulting from not having to maintain various pieces of
equipment, mainly street sweepers.
FUNDING AVAILABLE: Not applicable.
Richard C. Prima, Jr.
Public Works Director
RCPlpmf
K MMSolid WastekUranchiseRenewat doc 312012008
Solid Waste Franchise
Renewal AABusiness Points "
Lodi City Council
April 2, 2008
Background
• State law authorizes negotiated franchise
agreements for solid waste
• City has historically negotiated franchise
• Current franchise runs to March 2010
• One-year notice required on renewal
• December 17, 2007 — Council directed
staff to start negotiations early for best
leverage, leaving time to rebid
Negotiation Goals
• Work within the existing franchise
agreement
• No major changes in the basic services
and the rate structure
• Keep the rates where they are now
• Improve services to individual customers
for special trash removal and the public
overall in keeping the City clean
3
Process
• Internal staff meetings
• Meetings with CVWS representatives
• Focused on main points
• Seeking Council direction of main business
points before drafting detailed documents
• Will return to Council for approval of
franchise agreement extension
Draft Business Points
1) Street sweeping by CVWS:
a) Same frequency as city, or more often
b) Includes downtown sweeping
c) Includes winter leaf pickup, which would be
done with additional sweepers
a) Customers would be asked not to pile
leaves.
e) Additional recycle container available
Street Sweeping & Solid Waste
• State -PUBLIC RESOURCES CODE
§ 49300
The legislative body of a city may contract
for the collection or disposal, or both, of
garbage, waste, refuse, rubbish, offal,
trimmings, or other refuse matter under
the terms and conditions that are
prescribed by the legislative body of the
city by resolution or ordinance.
Lodi Municipal Code
§ 13.16.030 Contract for refuse collection
and transportation.
The city has the exclusive right and duty to
collect and transport refuse within the city limits,
under such terms and conditions as it deems
necessary for the public health, safety and well-
being; and it may contract with a contractor for
the provision of those services. (Ord. 1709 § 1
(part), 2002)
Other Cities with Waste Hauler
Sweeping Streets
• Davis
• Stockton
• Turlock
• Vacaville
• Woodland
• Fairfield (in transition)
• Morgan Hill
• Gilroy
Note — First six are typical Lodi salary comparison cities
Draft Business Points
2) Public on -street trash container service:
a) CVWS will service these containers (mainly in the
Downtown)
b) Also includes some transit stops
3) City service:
a) CVWS will service the trash containers/bins at City
facilities
b) Includes parks, both dumpsters and individual cans
Draft Business Points
4) Billing service:
a) Continue to reimburse the City for billing expenses
b) Amount fixed in past years
c) Future amount indexed to CPI
5) Hazardous waste:
a) Quarterly electronic/universal waste collection events
b) Annual household hazardous waste collection events
c) Both at the Turner Road facility or other Lodi location
6) Annual rate adjustments:
a) Annual change at 100% of Consumer Price Index
b) Now at 80% of the CPI
Draft Business Points
7) Renewal term:
a) Seven years
b) One CVWS option to renew for additional 7 years
c) Staff recommends that the new term start in 2008
8) Technical ordinance revisions
a) Industrial customer
b) Construction &demolition debris
9) Compactor rates
a) Rate for servicing certain types of trash compactors
b) Labor intensive
Service Impacts
• Street sweeping per contract (not subject
to City budget fluctuations)
• Improved leaf pickup (same as sweeping
schedule)
• Special waste collection events in Lodi
(rather than relying on County)
City Financial Impacts (Annual)
Item
Sweeper Replacement (2)
Sweeper 0 & M
Dump Charges
Leaf Pickup
On -street, Parks & Facilities
Billing: Increased
reimbursement
Tota I s :
Direct Savings Redirected Staff/Cost
$
63,500
$
115,900
$
50,700
$
2,300
$ 71,500
$ 7,500
$ 311,400
2 staff / $166,500
Portion of fleet maint. time
Approx. 1,300 hours/$52,000
Approx. 4,700 hours/$167,000
(assumed 3%)
$ 385,400
Total economic impact: $697.,000
0241,000 St.
Mets, $228,000 WW, $228000
Rate Impacts
• No impact in 2008
• Future increases are CPI based
• Currently at 80% of CPI, plus extraordinary
fuel and dump fees
• Proposed to be 100% of CPI, plus
extraordinary fuel and dump fees
• Annual average CVWS revenue difference
from CPI change for past three years:
$47,000
Average of last three years
CVWS Rate
revenue
$7.9
million
Notes:
80% of
CPI
2.46%
Total Adj.
3.21%
Revenue
Increase
based on
80% CPI
Additional
Revenue if
100% CPI
$471,000
Monthly
Service
Charge
Difference
• Total adjustment includes landfill and extraordinary fuel costs per franchise agreement
• Service charge difference based on 38 gal service
$0.13
Other Points
• City is approaching very tight budget year
• Street Fund dependent upon general fund
and gas tax
• General fund has many competing
interests
Summary of Business Points
i) Street sweeping
2) On -street service
3) City service
4) Billing service
5) Hazardous waste events
6) Annual rate adjustment formula
7) Renewal terms
s) Technical ordinance revisions
9) Compactor rates
Good evening Mayor Mounce, Council members
My name is Steve Haley. I live at 1967tC
ln c , Woodbridge
774i,K 6w'I am one of the sweeper operators for'Icworks.
I have been a city employee for 30 years and take pride in the job and service we provide.
It concerns me that the city manager and public works director think so little of our service
to the citizens of lodi.
am not alone in asking why the city would entertain the idea of contracting services.
esweeping program has been compared many times over the past years
to other agencies and contractors and has always proven to be cost affective.
From time to time companies have brought their crews and equipment in during leaf
season to do trial runs only to say no thanks we cannot match your work.
One reason for this is we do not need to operate for profit.
We are looking at a sweeping contract that came as a surprise to us at a low ball bid.
This low ball bid is not realistic and will be asking for more money as soon as the city
disposes of it's equipment afterall they are in business to make money.
(ht seems to bring more questions than solutions)
,t �;ciL
The citizens will be outraged to find out they are going to be charged newfees for a service that
they have already been paying for ..,,Are our citizens ready to pay extra for the removal of a pile
of leaves in front of their hm
Weven if it's a city tree ? Who is to notify all the landscapers,
homeowners and business -Owners they can no longer put anything in the street
v.Sc` C�c
TQATO1Aclu,, tKoA :Y Qu�s7�o+crs �►�•� 9w.s:.'t�25•
er concert),or s are in a area of storms are flooding due to leaves and debris. &
Normal sweeping will not be able to handle the amount of leaves that naturally fail, A01 [ �`t7�So+t••
This will mean more overtime to manually clear the streets. bud?%'� KAIPUY D AY S. cumt-c,
There will be pump damage due added debris in pump stations.'' r�5.
What will be the response time if a contractor is used for sweeping ?
How much staff time is going to used in redirecting all the calls for information, complaints, and
emergencies.
It is hard to believe that a contract of this size is not going out to bid.
We believe council should putthis out to formal bid. We feel this will bean eye opener for the
council and will show how good our own program is performing.
I ask you to let us continue our service to the citizens I.
The citizens do not need to paytwice for the services they already recieve.
Thank you