HomeMy WebLinkAbout06 - Waste Management Solid Waste Franchise AgreementCity Council Agenda
Item No. 6
June 14, 1999
TO: Mayor and City Council
FROM: General Services Director
SUBJECT: Assignment of Waste Management of Orange County Non - exclusive Solid
Waste Franchise Agreement and Termination of Non - exclusive Solid Waste
Franchise Agreement with Western Waste.
Recommendations
Adopt attached Resolution No. 99 -- terminating the commercial solid waste franchise
agreement between the City of Newport Beach and Western Waste and assigning the City's
franchise agreement with Waste Management of Orange County, Inc. to Waste Management of
Orange County, a Division of Waste Management Collection and Recycling, Inc.
Approve the attached Agreement to terminate the commercial solid waste collection franchise
agreement between the City of Newport Beach and Western Waste, and to assign the Waste
. Management of Orange County Franchise to Waste Management of Orange County, a division of
Waste Management Collection and Recycling, Inc.
E
Background
The solid waste industry has experienced numerous ownership changes in recent years including
the acquisition of Western Waste by USA Waste in May 1996 and the merger of USA Waste and
Waste Management, Inc. in September 1998.
In a letter dated September 11, 1998, Waste Management of Orange County notified the City that
USA Waste and Waste Management, Inc. had announced an agreement to merge. In addition,
Waste Management notified the City that other corporate consolidations were pending which
would require the assignment of Waste Management's solid waste franchise to a new corporate
entity. However, the City was asked to postpone making any changes until the merger and other
corporate consolidations were finalized within the Waste Management organization.
On April 16, 1999, Waste Management requested that the City proceed with terminating the
Western Waste franchise and assign the current Waste Management franchise to Waste
Management of Orange County, a division of Waste Management Collection and Recycling, Inc.
F:\ Users \GSV\MEIdndgc\APR1L 99 \Counci1-WMI Mrgrll.doc
Discussion
Per Chapter 12.63.130 of the City Municipal Code, the City Council has sole authority to
terminate or assign any non - exclusive commercial solid waste collection franchise.
Staff has prepared a resolution and an agreement to terminate the Western Waste franchise and to
assign the Waste Management franchise to its current corporate name. Approval of the attached
documents will in no way relieve Western Waste nor Waste Management of any current or
outstanding franchise fee obligations.
Very respectfully,
David E. Niederhaus
DEN /me
Attachments: (A) Proposed Resolution No. 99- — terminating the Western Waste Franchise
and assigning the Waste Management Franchise to Waste Management of
Orange County, a division of Waste Management Collection and Recycling,
Inc.
(B) Agreement to Terminate the Solid Waste Franchise Agreement with Western
Waste and to assign the Waste Management franchise to Waste Management
of Orange County, a division of Waste Management Collection and
Recycling, Inc.
F:\ Users \GSV\MEWridge\APWL 99\Co=ci1 -WMI Mrgr1Ldoc
RESOLUTION NO.99-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH TERMINATING THE
COMMERCIAL SOLID WASTE COLLECTION FRANCHISE
AGREEMENT BETWEEN THE CITY OF NEWPORT
BEACH AND WESTERN WASTE AND ASSIGNING THE
COMMERCIAL SOLID WASTE FRANCHISE AGREEMENT
BETWEEN THE CITY OF NEWPORT BEACH AND
WASTE MANAGEMENT OF ORANGE COUNTY
WHEREAS, on January 2, 1996, the City of Newport Beach entered into
commercial solid waste collection services Franchise Agreements with Western Waste
and Waste Management of Orange County (collectively the "Franchises "); and
WHEREAS, since the adoption of the Franchises, City has learned of a series of
mergers and acquisitions involving both Western Waste and Waste Management of
Orange County. The various mergers and acquisitions were commenced and /or
completed without sufficient notice to City to approve an assignment of the Franchises.
• The series of mergers and acquisitions have culminated in the creation of Waste
Management of Orange County, a division of Waste Management Collection and
Recycling, Inc. ( "WMOC "), WMOC has agreed to assume all of the obligations,
conditions and responsibilities for all operations of all predecessor entities operations
under the Franchises; and
WHEREAS, without WMOC's agreement to pay all outstanding fees and
penalties as provided in the Agreement attached hereto as Exhibit "A" and incorporated
herein by reference, Council would not approve assignment of the Franchises; and
WHEREAS, the City Council has been presented with an agreement to terminate
the Western Waste Franchise Agreement and assign the Waste Management of
Orange County Agreement.
NOW THEREFORE, the City Council resolves as follows:
1. The City Council hereby approves the termination of the Franchise
Agreement with Western Waste.
2. The City Council hereby approves the assignment of the Waste
Management of Orange County Franchise Agreement to Waste Management of Orange
County, a division of Waste Management Collection and Recycling, Inc.
•
3. The Agreement to Terminate the Commercial Solid Waste Collection •
Franchise Agreement Between the City of Newport Beach and Western Waste and to
assign the Waste Management of Orange County Franchise to Waste Management of
Orange County, a division of Waste Management Collection and Recycling, Inc.,
attached hereto as Exhibit "A ", is hereby approved and the City Manager is authorized
to execute the Agreement as written.
ADOPTED this _ day of 1999.
"CITY"
CITY OF NEWPORT BEACH,
a Municipal Corporation
Dated: By:
Dennis O'Neil,
Mayor
ATTEST
LaVonne Harkless,
City Clerk
FAUwm%GSVN1EIdridge\APRIL 991Cowcil -WMI Res.doc i •
EXHIBIT (A)
AGREEMENT TO TERMINATE COMMERCIAL SOLID WASTE
• COLLECTION FRANCHISE AGREEMENT BETWEEN THE CITY
OF NEWPORT BEACH AND WESTERN WASTE AND TO
ASSIGN THE WASTE MANAGEMENT OF ORANGE COUNTY,
INC. FRANCHISE TO WASTE MANAGEMENT OF ORANGE
COUNTY, A DIVISION OF WASTE MANAGEMENT
COLLECTION AND RECYCLING, INC.
This Agreement is entered into on this day, the 14 day of June, 1999 and
executed by and between the CITY OF NEWPORT BEACH, a municipal corporation
( "CITY "), AND Waste Management of Orange County, a division of Waste Management
Collection and Recycling, Inc.
RECITALS
A. On January 2, 1996, the CITY entered into a Commercial Solid Waste
Collection Franchise Agreement with Western Waste ( "WESTERN
WASTE FRANCHISE "). On January 2, 1996, the CITY entered into a
Commercial Solid Waste Collection Franchise with Waste Management of
Orange County, Inc. ( "WASTE MANAGEMENT FRANCHISE "). The two
franchises will be referred to herein collectively as "FRANCHISES."
• B. On May 7, 1996, Western Waste merged with USA Waste Services, Inc.
On or about June 1, 1998, Western Waste began to operate as USA
Waste of California, Inc. Since December, 1997, Waste Management of
Orange County, Inc. has been merged with Waste Management Collection
& Recycling, Inc., a wholly owned subsidiary of Waste Management of
North America, Inc., which is a wholly owned subsidiary of Waste
Management, Inc.
C. On September 11, 1998, Waste Management of Orange County notified
the CITY that USA Waste Services, Inc. and Waste Management, Inc.,
had merged. The CITY was requested to cancel the WESTERN WASTE
FRANCHISE and assign the WASTE MANAGEMENT FRANCHISE to
Waste Management of Orange County, a division of Waste Management
Collection and Recycling, Inc.
D. The CITY desires to clarify the operations of the FRANCHISES and to
terminate unnecessary agreements.
NOW THEREFORE, the CITY and Waste Management of Orange County a
division of Waste Management Collection and Recycling, Inc. (hereinafter "WMOC ")
agree as follows:
WMOC hereby stipulates that the above - referenced recitals are true and
accurate representations of the corporate status of Western Waste and •
Waste Management of Orange County. WMOC agrees that the Western
Waste and Waste Management of Orange County, Inc. corporate entities
operations have been merged with and transferred to the corporate entity,
Waste Management Collection and Recycling, Inc., and WMOC has
authorization and legal standing to execute this Agreement, and to
surrender the WESTERN WASTE FRANCHISE and to assume all
responsibility of the FRANCHISES.
Except for obligations of WMOC described below, the WESTERN WASTE
FRANCHISE is hereby terminated effective June 14, 1999, and shall be of
no further force and effect.
3. By signing this Agreement, WMOC and Western Waste shall have
surrendered all rights to operate commercial solid waste collection
services under the name of Western Waste in the CITY limits.
4. By signing this Agreement, Waste Management of Orange County, Inc.
has surrendered all rights to operate commercial solid waste collection
services within the CITY limits and will hereafter operate all commercial
solid waste collection services under the name of Waste Management of
Orange County, a division of Waste Management Collection and
Recycling, Inc. •
5. CITY hereby consents to the assignment of the WASTE MANAGEMENT
FRANCHISE from Waste Management of Orange County, Inc. to Waste
Management of Orange County, a division of Waste Management
Collection and Recycling, Inc. (hereinafter referred to as Franchise
Agreement) WMOC agrees to the following conditions of assignment:
(a) All terms and conditions of the Franchise Agreement shall remain in
full force and effect and the full and complete obligation of WMOC.
WMOC agrees to fully comply with all terms and conditions of the
Franchise Agreement.
(b) WMOC agrees that all solid waste collected by WMOC will be
disposed of per the provisions of the Franchise Agreement at a
location identified by City.
(c) WMOC agrees that the Franchise Agreement shall terminate on
December 31, 2005 and no extension of the Agreement is granted by
this Assignment.
•
(d) WMOC shall pay to CITY any and all deficient franchise fees, or other
• fees, or penalties, or obligations incurred under the FRANCHISES, as
provided in #6 below.
6. WMOC shall be liable for payment to CITY of all applicable fees and
penalties associated with the WESTERN WASTE FRANCHISE and the
WASTE MANAGEMENT FRANCHISE and all solid waste collection
services performed by or under the name of Western Waste, Waste
Management of Orange County, Inc., USA Waste of California, Inc., or
Waste Management Collection and Recycling, Inc. or any other predecessor
or subsidiary entities under the FRANCHISES during the term of Franchises
through and including June 14, 1999. WMOC agrees that liability shall
include, but not be limited to, the following:
(a) All current and outstanding franchise fees;
(b) All applicable charges associated with late payment of franchise
fees pursuant to Section 4 of the FRANCHISES;
(c) All applicable charges associated with reporting delinquencies
pursuant to Section 6 of the FRANCHISES;
7. WMOC agrees to submit any outstanding Disposal Reports per Section 6
. of the FRANCHISES.
8. The Board of Directors of WMCO has authorized execution of this
Agreement, which authorization has been documented and provided to
City prior to execution of this Agreement.
L�
WITNESS THE EXECUTION OF THIS AGREEMENT ON THE DATE WRITTEN
BELOW EACH SIGNATURE:
Dated:
ATTEST
LaVonne Harkless
City Clerk
APPROVED AS TO FORM:
ROBIIN CLAUSON
Assistant City Attorney
FiUsemkGS\AMEldddgeWPRIL 9MCouncil- WMI_Agreemt.doc
CITY OF NEWPORT BEACH,
a Municipal Corporation
In
Homer Bludau
City Manager
WASTE MANAGEMENT OF ORANGE COUNTY
By: z� zA( 47�
Name: /t'6<ce we -c z
Title: D�S�i�r L / C anacJP�
4
0
is
0