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HomeMy WebLinkAbout09-11-1995 - Special MeetingROLL CALL P nt A t • CITY OF NEWPORT BEACH SPECIAL COUNCIL MEETING MINUTES A a: 3 q LJ F— QLJLd0J, 38 _ Cr W w (3 g 2 x 000 W > o w z PLACE: Council Chambers TIME: 3:00 P.M. DATE: September 11, 1995 IND X x x x x x ROLL CALL X Report from General Services Director regarding EXECUTIVE GS /Wast4 SUMMARY ON WASTE ISSUES: Issues (44) City Manager Kevin Murphy summarized that at the June 12 regular Council meeting the issues related to refuse were primarily prompted by actions of the County in increasing their landfill tipping fee from $22.75 per ton to $35.00 per ton, increasing costs to the City nearly 1/2 million dollars per year, which now appears to be closer to the $250,000 range, but obviously still a major impact on the City's financial situation. He referenced the General Services Director's Executive Summary Report on Waste Issues and the recommended actions to be considered by the Council regarding Items 1 - 5. In response to Mayor Hedges' comments regarding the adequacy of staff's coverage, Council Member Edwards stated that he would like to have more input on the scavenger issue; and for the record, Council Member O'Neil advised that he will not be voting on Item 5 due to a potential conflict of interest. Council Member Cox took his seat at the Council table at this time. 1. PRIVATIZATION OF REFUSE COLLECTION. David Niederhous, General Services Director, introduced Tim Smith, SCS Engineers, Inc., the author of the Privatization Report, and advised that, basically, staff is recommending the Council accept the findings in the proposed actions. The General Services Director reinforced the comments made by the City Manager regarding the outstanding performances of Roger Lilly, City Refuse Superintendent and the 28 men under Mr. Lilly's supervision, and gave a resultant overview of the proposed actions (a- e): a) Finds that If the entire budget for refuse collection and disposal for Fiscal Year 1995 -96 is expended, i.e., every dollar is spent, theoretically the cost per resident would rise from $11.43 to $13.06. This would still put the City well below the County -wide average monthly residential waste bill. Volume 49 - Page 391 ,EX CITY OF NEWPORT BEACH MTT* TTTFC ROLL CALL Q' 3-MQX0Z W 3Q2000 Lj J September 11, 1995 INDEX (b) Concurs with the methodology in the SCS Waste Issue: Engineers' Report. Staff will have further comments later after a review of a cost service fee study by the accounting firm of KPMG, but would like to proceed with a reassessment of a recycling surcharge so that the City can start to make the adjustments that have occurred with the landfill increase on July 1 and the CPI that was effective August 1 with the CRT recycling contract. The annual reassessment of the City recycling surcharge has been delayed until the solid waste issues have been resolved. (e) Mike Silva, a representative along with the President of CRT, were introduced and were prepared to answer questions regarding the City's renegotiation of the CRT contract, (c) Proposes a refuse collection fee which requires a ballot initiative as early as next March, but only as a last resort if all other alternatives fail. (d) Concurs with SCS's findings that the 205 commercial businesses the City now collects from (five days in the winter and six days in the summer) either be curtailed, or possibly charged a recycling fee that would be five or six times what the bill would be for a normal resident who receives only monthly services. Discussion ensued regarding costs by other local government agencies as compared with the City refuse operation, wherein Tim Smith of SCS, Inc., estimated that most of these agencies are subsidized by revenues from commercial refuse collection franchise fees, and it is difficult to quantify the amount that commercial collection is subsidizing residential collection of rubbish. SCS has addressed this in their study, and it was pointed out that the closest true comparison for the City of Newport Beach, was with the City of Costa Mesa ($12.30 per month) because they have a private hauler who provides only residential rubbish service and no commercial service. Following discussion, Mayor Hedges suggested the Council straw -vote each of the proposed actions, • and invited public comments. Volume 49 - Page 392 CITY OF NEWPORT BEACH MINUTES ROLL CALL A 3�MAx'oz A3A_000 u) J September 11, 1995 INDEX 1a John O'Malley, representing the members of the Waste Issues Newport Beach Employees League, addressed the Council stating that the League President, and the Directors and members "unequivocally" support the General Services Director's recommendation that the City's refuse collection services not be privatized based on right reason, convincing independent evidence, and a loyal and efficient workforce. He emphasized that In 1991 there were 37 full -time Refuse Division employees and presently, after streamlining the operation, 29 employees provide the same high quality service for the residents of Newport Beach. Citing SCS, Engineers' cost - service study, he added that the City of Newport Beach is providing its residents with one of the highest levels of refuse collection services in the County at rates well below the average. Madelene Arakelian, South Coast Refuse Integrated Recycling Systems, addressed the Council stating that she supports the continued refuse collection provided by City personnel. She questioned the research of SCS, as when she • called the following agencies, she was told that Anaheim's cost figures are - $15.06, Brea 413.46, Placentia - $14.36, Garden Grove Sanitation District - $15.20, Yorba Linda- $16.52, and Villa Park - $15.60. Nancy Gardner, 323 Jasmine, addressed the Council, stating that she doesn't feel the City's only concern should be the cost per household. As a participant in an EQAC meeting she viewed a presentation which included ideas such as taking the City trucks and replacing them with new trucks without charge to the City, hiring the City refuse employees, retaining the General Services Director, etc., and felt that by going to something like a bid the City may end up with some alternative ideas. Dolores Otting, 17 Hillsborough, owner of Five Star Rubbish, stated that with regards to the franchise fee comparison on the residential, that franchise fee is paid by the citizens or taxpayers, and this should not be an issue. She is disappointed that SCS is not really comparing the true rates of what is really out there today, i.e., the City can buy diesel fuel for 81 cents per gallon, and as a small • company she and the other franchise haulers do not have the advantages that a municipality has. She added that the residents will pay more money to keep the City employees picking up the trash as they love them, and this is the only interface the residents have with the City of Newport Beach. Volume 49 - Page 393 CITY OF NEWPORT BEACH MINUTES ROLL CALL G 3�mAx'0z W 3mm°0o rn a 00 J September 11, 1995 INDEX Tom Hyans, President of the Central Newport Waste Issues Beach Community Association, questioned the accuracy and reliability of the consultant's figures on expenses for trash removal by other cities in the County, as was also pointed out by the previous speaker. He cited the data provided in the report for the total annual compensation for refuse collectors in the City as $53,000 (including probably 30 -35% fringe benefits), estimating that 43`90 of the cost represents labor. He would like to see more detail on how these figures are derived In comparing the only City in the County (Newport Beach) that have their own trash collectors with other cities in the County. Al Bartolic, 2312 Winward Lane, is in favor of the City retaining its own trash collection, but one of the things that he is concerned with is what is going to happen on Balboa Island with the trash collection on the beach, is this going to be farmed out? He commented that as a property owner who has contracted with independent services he has been unhappy with these services. He feels that the employees are loyal and provide a good service. He agrees with the foregoing speaker that • the residents have very little contact with the City other than through the refuse collectors, but that there are a few too many supervisors in the department, as the employees are very organized and well documented as far as time spent on the job. He added that he would be happy to serve on a City committee. Bruce Lloyd, 1826 Toyon Lane, addressed the Council stating that about a year ago he vehemently fought the privatization of trash collection, and he still feels that way. He is very happy that the recommendation is to continue to use City refuse employees. He added that when he lived in Laguna Beach he experienced private hauler service, and found that he would have to spend approximately thirty minutes or more picking up the trash left behind after his area was serviced. He posed two questions: 1) what was the cost to the City of the SCS report and why couldn't this study have been done by staff, as he feels that this is something the City Council should have considered before going outside; and 2) he was • led to believe that the City has people working in the General Services Department who work doing other things to earn money and get overtime collecting trash, etc. He feels that from the standpoint of good management these employees should be on a separate time card so that the allocation can go to the proper department as a matter of cost accounting and true reporting. Volume 49 - Page 394 CITY OF NEWPORT BEACH MINUTES ROLL CALL cl Q3A=°0o } w M w 00 N Z September 11, 1995 INDEX As regards the cost of the SCS study, Mayor Hedges Waste Issues stated that the figure was $7,000: and the General Services Director responded that there are people filling in from other divisions when necessary (special trash pickups, illnesses and industrial injuries) for the trash operation and this solution has existed for the past 50 years. Yvonne Houssels, 1302 Outrigger Drive, President of Harbor View Hills South Homeowners Association, addressed the Council in support of continuing the City refuse collection. Their Association feels that the General Services Director has done a marvelous job and most of the residents are very pleased with the City and how the trash operation is handled. She added that they are very concerned about privatization leading to automated trash, which they feel is completely impossible in their particular housing development the way that their trash cans are situated and the difficulty of getting them out to the streets. Also, she added that they would like to see a little better coordination so that the street sweeping comes after the trash collection, but overall, • complimented the City employees. Phil Sansone, 215 Marguerite, former Mayor and Council Member, addressed the Council in support of the recommendation to continue the City refuse collection because of the general acceptance of the City's trash collection procedures and its outstanding service, but he feels that the $35.00 figure is "phony." With the changes in the State Legislature, AB 939 is in for drastic overhaul, and this figure will not remain the same, basically because several counties and cities in the state are running out of landfill. He feels that Orange County should have been exempt from AB 939, except for the recyclable resalable items because they have a surplus of landfill. He added that by retaining the current trash service, the City has solid control. Judy Ware, Vice President of the Spyglass Ridge Homeowners Association, remarked that the General Services Department provides an efficient service, and they are very satisfied with the performance of the City personnel. M x Council Member Glover made a motion to Al Ayes approve 1(a): Accept the findings of SCS Engineers. Inc., that includes the recommendation that the City refuse collection continue to be provided by City personnel, and with input from the drivers for further improving the service to the citizens. Volume 49 - Page 395 CITY OF NEWPORT BEACH MINUTES ROLL CALL In Q�Q0 QCZWW0 W X m m m °? u � 'W u J o September 11, 1995 INDEX • I (b) With regard to the recycling surcharge proposal, Waste Issues 1(b), the City Manager commented that staff would like direction on the methodology and calculation of the recycling surcharge program. He referenced page 15 of the staff report wherein the cost of recycling would move from $1.98 to $2.69 per residential household. Council Member Glover commented that she feels recycling is a basic service, and she is not in support of increasing the recycling surcharge. Motion x Motion was made by Council (Member Edwards to approve proposed action 1(b): Direct staff to prepare a recycling surcharge proposal using the SCS Engineers methodology and include any comments by KMPG Peat Marwick prior to submission to the City Council. Mayor Hedges invited public comments on 1(b), wherein the following persons addressed the Council: Phil Sansone questioned the methodology, • stating that the old formula is a good calculation, and should not be reformulated. Dolores Offing questioned why the City is not talking about exporting trash from the County system until the County gets its act together, and why the charge is $35.00 a ton. She added that there is no need to use the Orange County Landfill. In response to Council inquiry, the City Manager stated that staff has had preliminary discussions with CRT to take the trash to other landfills outside of Orange County, as well as other means of disposing trash, i.e., the Waste Energy Plant in Long Beach or Commerce. He added that items 1(b) and 1(e) have to be really explored. Madelene Arakelian commented that she has a very deep concern about this issue, as she is so involved in Sacramento, and she lives in the City. She wanted to know if the City is really tracking where the waste is being taken, and making sure that the cost is $35.00 per ton, • adding that "we need to be much more aware of what it is we are paying for so that the citizens can get the best deal." Mayor Hedges stated that he will support the motion; that the recycling fee not be increased just to create more revenue for the City, but to keep the cost as low as possible. Volume 49 - Page 396 CITY OF NEWPORT BEACH 158800 ROLL CALL uVj, 3 � W:KMMU0o Lo x 0� 0 J Z September 11, 1995 INDEX Yvonne Houssels stated that she supports Mr. Waste Issues • Sansone's views, and feels that the citizens should get the lowest recycling rates possible. Ayes x x x x x x Hearing no one false wishing to come forward, Noes x Council Member Edwards' foregoing motion was voted on, and carried. Motion x Mayor Hedges invited comments on 1(c), and hearing no one wishing to address the issue, he stated the proposed action, "appoint a citizens advisory committee to review all options and accept public comments relative to the repeal of the initiative ordinance prohibiting a refuse collection fee," wherein Council Member Cox moved approval. Following Council discussion, Mayor Hedges and Council Member Watt stated that they were prepared to vote no on this issue at this time. Mayor Pro Tern Debay stated that she was in support of having public discussions via a citizens advisory committee, as it is a way to educating the • citizens and informing the homeowners associations. Motion x Mayor Hedges made a substitute motion to table this matter until such time as some of the preliminary issues are resolved. Following further discussion, Mayor Hedges advised that he proposes to indefinitely table the issue of appointing a citizens advisory committee to evaluate public comments on the repeal of the initiative ordinance prohibiting a refuse collection fee. He added that he is all for having a citizens advisory committee, but he feels that the political reality is nill to repealing the initiative ordinance and that Council is wasting their time. Ayes x x x x Following clarification on the substitute motion, a Noes x x x vote was taken to table this matter indefinitely. jUd Motion x Following summary by the City Manager on this issue, Council Member Glover made a motion to approve: 1(d) Direct staff to investigate the • feasibility of curtailing, eliminating, and or charging for current commercial rubbish collection provided by City staff and also investigate incurring recycling costs. Mayor Hedges invited public comments. Volume 49 - Page 397 CITY OF NEWPORT BEACH MINUTES ROLL CALL X w3Q=U0o H-MlA } a: w W OZ H September 11, 1995 INDEX • Dolores Citing questioned the rationale of the Waste Issues frequent trash pickups in the City, and feels that the over - servicing of the commercial accounts needs to be looked at. All Ayes Council Member Glover's motion was voted on and canted. le The City Manager stated that the City is trying to find the most economical way to provide the service at the highest level possible and staff will be looking at all options. Motion x Council Member Glover made a motion to approve 1 (e): Direct staff to continue discussion with CRT, Inc., and at the same time to open up the bidding competition to other private companies similar to CRT, Inc., for the 5 remaining years with the CRT contract, but not to commit to renegotiate beyond the 5 -year contract with CRT for the processing of recyclables. Mayor Hedges invited public comments, wherein • the following people addressed the Council: Phil Sansone stated that after his experience serving on the County Waste Management Commission, he feels concern should be given to the Rate Stabilization Agreement which is mentioned in the staff report. This went into dormancy just before the County bankruptcy occurred. He added that there should be some kind of agreement on trash flow, as all it takes is one major hauler to leave the County for the system to collapse. With the multitude of issues to consider regarding fluctuations in the cost to recycle paper, cardboard, etc., and recyclables that are not resalable, he feels that a contract will be difficult to negotiate. It may be that the City could negotiate the price based upon the fact that the trash could go to BKK Landfill (private company in Los Angeles County) or maybe to the Long Beach Incinerator. Dolores Otting referenced an agenda from the City of Fullerton, and cited a recent situation wherein they negotiated with MG Disposal for a • rate of $37.75 per ton. The rate today, because of the landfill increase, is $47.50 per ton, and she Volume 49 - Page 398 CITY OF NEWPORT BEACH MINUTES ROLL CALL U, 3 W3q=°90 I~- Ul M x rY September o J z 11, 1995 INDEX stated that what is not understood is that if Waste Issues anyone of the MRF (Materials Recovery Facility) Cities gives Newport Beach a rate that is, for example, $30.00 and services their host city at $52.00 this will be a horrible Pandora's Box. She stated that CRT is giving the City the best rate in the County of Orange. She feels that there is no problem with trash, but that the City is making its own problems. She added that Newport Beach has one of the best systems in America, with regard to its commercial trash operation. Mike Silva, 11292 Western Avenue, Stanton, President of CR Transfer, addressed the Council commenting that some of SCS's conclusions are incorrect relevant to their operation going outside the County, as he was never contacted by the consultant, and yes they do, but, not with Orange County trash. His operation services Cerritos, Downey, Bellflower, Signal Hill and several Cities throughout Riverside /San Bernardino, and they go to the Commerce Plant, in addition to Long Beach. Relative to the • EQCAC report, he did not have an opportunity to meet with them. He added that there is no service offered by any other hauler in Southern California that CR Transfer doesn't do, as they service 11 Cities in Orange County (all of South Orange County, Dana Point, San Juan Capistrano, San Clemente); do all the processing for them and can provide any service whether it's manual, automated, or recycling. Mr. Sansone is correct that the recyclables is a give and take situation, and CR Transfer was open to this situation when they negotiated the current 5- year contract. He advised that Newport Beach has never been paid for recyclables, but he has never billed the City either, and this is what the other cities are not revealing —that they are getting rebates today, but they got bills a few years ago. He feels that Newport Beach should get all the facts, and that CR Transfer is open to all negotiations. Motion x Mayor Hedges moved to amend Council Member Glover's motion to delete the 5 -year limit on term, because this may unnecessarily restrict the scope 40 of bargaining in the negotiations. Council Member Glover stated that she wanted to be sure that the staff does not renegotiate, for example, a 10 -year contract with CR Transfer without other haulers or other groups having the opportunity to bid and compete for the service. Volume 49 - Page 399 ROLL CALL �J Ayes Noes 0 CITY OF NEWPORT BEACH MINUTES L0 N J > w 95 September 11, 1995 F Q W J? M W m 3q2 W V 00 INE X x x X X x Mayor Hedges' amended motion to delete the 5- Waste Is X year limit was voted on and carried. X x x x x x Council Member GrIover's motion was voted on as X restated: "To direct staff to continue discussion with CRT, Inc., and at same time open up bidding competition to other private companies similar to CRT, Inc., for the processing of recyclables, but to not renegotiate with CRT, Inc., beyond the 5 -year contract now in place." Mayor Hedaes advised that Items 2 -4 will be deferred to another meeting: possibly, to the October 9 regular City Council meeting. 2. AUTOMATED REFUSE: COLLECTION (ARC). Report from General Services Director recommending to retain the current manual refuse collection system. 3. GREEN WASTE. Report from the General Services Director recommending consideration of the implementation of a green waste recycling program at a later date pending any changes in the State recycling mandate. 4. RUBBISH LIMITS. Report from the General Services Director recommending staff be directed to prepare an ordinance limiting weekly residential rubbish to six containers (bag, cans, or a combination) not to exceed 200 pounds in weight per residence serviced by City staff. 5. Report from the General Services Director regarding COMMERCIAL SOLID WASTE ISSUES. Council was advised that after the agenda was printed, a letter was received from Cherie Grazier stating that she does not support the franchise system. The City Manager gave a summary, indicating that a lot of the goals can be achieved by either pursuing an exclusive or nonexclusive franchise for the refuse collection system in the City. Mayor Hedges invited public input on this issue. Volume 49 - Page 400 ,EX sues CITY OF NEWPORT BEACH MINUTES ROLL CALL A 0- W 3 CM Q= 0 U W 0 0 _j Z o Selptember 11, 1995 INDEX Michael Balliet, addressed the Council, stating that Waste Issues he is with Americlean Environmental Services • dealing with solid waste issues, and is a Consultant to the City of Costa Mesa. He feels that the City Council does not have all the information they need, and stated that Costa Mesa businesses have rates that are half that of the cities with franchise rates, and disagrees with the report, "that it is in the publics' interest to have a single franchise hauler," but that it is in the single franchise hauler's interest. He added that in checking with other cities throughout this County and other counties, franchised cities businesses pay for that through much higher trash rates. He cited vague promises in the subject report. He supports keeping the City open, giving the 30-40 year businesses who have worked hard an opportunity to continue making their livelihoods. Bruce Lloyd stated that he personally doesn't think the City should extend the franchise, as this will be the first step to going to privatization for everything else in the City. He feels that the businesses should be allowed to select the person they wish to have at an agreed price. The City can certainly set standards, but he feels that it is up to the business • community and not the City to decide this for them. Council Member O'Neil advised that for the record, the fact that his law firm represents Western Waste Management who currently operates in Newport Beach, he will excuse himself from voting on this issue, due to possible conflict of interest, Madelene Arakelion, owner of South Coast Refuse Integrated Recycling Systems, addressed the Council and stated that she started her business in Newport Beach 20 years ago, being a third - generation Californian. She is also on the Board of Directors of the Greater Los Angeles Waste Haulers Association and does not want to see her business taken away from her after spending 40 years in the City, 20 years of leasing and renting, and 20 years of owning a home in Newport Beach and paying taxes. She stated that her operation is an all - family- business, is the primary support, and has worked very hard and diligently at building a business on honesty and integrity. Basically, after talking with the City Manager and Council, she feels that franchising is to increase City revenues. She added that the notice given was that the City was thinking about franchising and not the intent of the Code, and will be challenged in court if need be. If the City definitely decides to go to a franchise, then they must give this 5 -year notice referred to in the Code. Volume .49 - Page 401 CITY OF NEWPORT BEACH MINUTES ROLL CALL vm_ cl: g3A=°Uo N (M � 00 J z September 77, 1995 INDEX Dolores Otting, owner 5 -Star Rubbish, addressed Waste Issues • the Council and presented signed petitions in opposition to "monopolies and in favor of Free Enterprise staying alive in Newport Beach." She added that there is no reason to take away competition and free enterprise from the business community and the businesses in Newport Beach. She cited a newspaper article that announced the City of Lake Forest as having two meetings on trash contracts and bids so that the public can understand what is going on, whereas, Newport Beach is having a meeting at 3:00 p.m., and there were property managers and business people that wanted to come to the meeting and express their opinions to the Council, but they had to work. She added that If the City needs the money, then be fair about it and call it a tax which is what it is and put it onto the business license fee. She hoped that the Council will table this issue. Nancy Arakelion, Director of Sales for South Coast Refuse and Integrated Recycling Systems, commented that their operation is very happy that Newport Beach has always been a free and open- competitive City, and in the case of her • company, she makes sure that they follow the mandates of AB 939. She attended the recent Commission meeting that discussed the differential rate for bringing in trash from Los Angeles. She advised that everybody in Orange County has done such a phenomenal job with AB 939 in reducing what is at the landfill as now the County has surplus space to handle extra trash because of this accomplishment, and when she sees an argument in favor of franchising she, personally, doesn't think that AB 939 is as much of a threat as was originally perceived. She hoped that the Council keeps open competition as it has been working very well, and perhaps, if the City wanted to create more revenue she suggested they keep the present haulers, and consider a partial franchise. John K. Agamalian, A- Trojan Disposal Services, Los Angeles, stated that they do not do as much volume as some of the haulers in the City, but primarily haul construction debris with the large dumpsters. He added that it is obvious the • businesses are going to pay 1/2 million dollars more in trash bills throughout the City, and suggested keeping competition and nonexclusive franchising open to all haulers currently operating in the business, but to add a tax onto a portion of their gross receipts which would be paid to the City. Volume 49 • Page 402 CITY OF NEWPORT BEACH MINUTES ROLL CALL Q 3�MAx'0Z W Cr = A m c°» W _, o September 11, 1995 INDEX Mon x Council Member Glover made a motion to direct Waste Issues X x x x x x staff to coordinate the preparation for a non- ain x exclusive franchising fee with the City's commercial solid waste activities; and to include recommendations from the City Manager regarding recycling and indemnifying the City, AB 939, the surplus issues, the franchise fee and the term of the agreement. Meeting adjourned at 5:37 p.m. eaar a•rrarrrsrrsr srss The agenda for this meeting was posted on August 31, 1995, of 11:30 a.m., on the City Hall Bulletin Board located outside of the City of Newport Beach Administration Building. Mayor • ATTEST: Po 1'T 4 City Clerk��' • Volume 49 - Page 403