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HomeMy WebLinkAbout2015-26 - Approving an Amendment to the 2009 Waste Disposal Agreement with the County of OrangeRESOLUTION NO. 2015 -26 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH APPROVING AN AMENDMENT TO THE 2009 WASTE DISPOSAL AGREEMENT WITH THE COUNTY OF ORANGE WHEREAS, the City has an existing Waste Disposal Agreement (the Waste Disposal Agreement) with the County of Orange (the "County ") which requires the City to dispose of all specified solid waste generated within the City to County landfills and for the County to accept all such waste at a price agreed upon by the City and County; and WHEREAS, the Waste Disposal Agreement became effective on or about July 23, 2009, and by its term is set to expire on June 30, 2020; and WHEREAS, the Waste Disposal Agreement provides that the County will not accept waste imported from outside the County at County landfills after June 30, 2016; and WHEREAS, an Amendment to the Waste Disposal Agreement (the "Amendment'), which is attached hereto as Exhibit "A" and incorporated herein by this reference, has been negotiated between the County and various cities throughout Orange County to provide for continuation of importation of waste from outside the County at County landfills in exchange for allocation to the cities of a portion of future importation revenues and to extend the terms of this activity within the Waste Disposal Agreement to June 30, 2025; and WHEREAS, the City Council desires to ensure that solid waste generated within the City can be disposed of in an environmentally safe manner and at a reasonable cost for the near future; and WHEREAS, the proposed Amendment furthers these goals by, among other things, ensuring that solid waste generated within the City can be disposed of at County landfills through -June 30, 2025; that the landfills will be operated in an environmentally safe and reliable manner; and that the cost of disposing of solid waste at County landfills will be reasonable. NOW, THEREFORE, the City Council of the City of Newport Beach resolves, finds and determines, on the basis of the facts set forth in the agenda report presented to it and any testimony received at the meeting at which this matter was considered, as follows: Section 1: The foregoing recitals are true and correct. Section 2: The City Council hereby finds and determines that the proposed Amendment to the Waste Disposal Agreement between the County of Orange and the City of Newport Beach ( "Amendment ") furthers the public health, safety and welfare. Section 3: The City Council hereby finds and determines that the terms and provisions of the Amendment, in the form as submitted by the City Manager, are approved and that the Mayor is authorized to execute, and the City Clerk to attest, the Amendment on behalf of the City. Section 4: The officers and employees of the City are authorized and directed, jointly and severally, to do any and all things necessary or advisable in order to effectuate the purposes of this Resolution and to administer the City's obligations, responsibilities and duties to be performed. Section 5: This Resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting the resolution. ADOPTED this 14th day of April, 21 Edward D. Selich Mayor ATTEST: 46 , Eeilani 1. Brown r City Clerk EXHIBIT A AMENDMENT TO WASTE DISPOSAL AGREEMENT Between THE COUNTY OF ORANGE, CALIFORNIA and the CITY OF NEWPORT BEACH County Amendment Authorization Date: _, 2015 County Notice Address: Director OC Waste and Recycling 300 N. Flower, Suite 400 Santa Ana, CA 92703 2015 Amendment to waste Disposal Agreement April 14, 2015 City Amendment Authorization Date: April 14, 2015 City Notice Address: Dave Kiff, City Manager City of Newport Beach 100 Civic Center Drive P.O. Box 1768 Newport Beach, CA 92658 AMENDMENT TO WASTE DISPOSAL AGREEMENT THIS AMENDMENT TO WASTE DISPOSAL AGREEMENT (the "Amendment') is made and dated as of the date indicated on the cover page hereof between the County of Orange, a political subdivision of the State of California (the "County"), and the City designated on the cover page of this Amendment, a charter city and political subdivision of the State of California (the "City "). RECITALS The County owns, manages and operates a sanitary landfill system for the disposal of municipal solid waste generated by the cities and the unincorporated area within the County (the "Disposal System "). The Disposal System includes three active landfills and four regional household hazardous waste collection centers. The Disposal System is used for the disposal of municipal solid waste which is not reused, recycled or otherwise diverted from landfill disposal, pursuant to the California Integrated Waste Management Act of 1989 (Division 30 of the California Public Resources Code) (the "Act'). The County has entered into waste disposal agreements in 2009 (the "Original Waste Disposal Agreements ") with all of the cities in the County, including the City, as well as certain sanitary districts located in the County (the "Participating Cities"), pursuant to which the County agreed to provide disposal capacity for waste generated in or under the control of the Participating Cities, and the Participating Cities agreed to deliver or cause the delivery of waste generated in or under the control of the Participating Cities to the Disposal System, as more specifically set forth in, and subject to the terms and conditions of, the Original Waste Disposal Agreements. The City has determined that the execution of this Amendment by the City is in the best interest of the City and will serve the public health, safety and welfare by providing greater disposal rate stability, more predictable and reliable long -term disposal service, and sound environmental management. The County has determined that the execution by the County of this Amendment will serve the public health, safety and welfare by providing a more stable, predictable and reliable supply of municipal solid waste and the resulting service payment revenue to the Disposal System, thereby enabling the County to plan, manage, operate and finance improvements to the Disposal System on a more prudent and sound long term, businesslike basis consistent with its obligations to the State and the holders of obligations secured by its Disposal System. Official action approving this Amendment and determining it to be in the public interest and authorizing its execution and delivery was duly taken by the County on the County authorization date indicated on the cover page hereof. Official action approving this Amendment and determining it to be in the public interest and authorizing its execution and delivery was duly taken by the City on the City authorization date indicated on the cover page hereof. It is, therefore, agreed as follows: 2015 Amendment to Waste Disposal Agreement Section 1. Amendment to Original Waste Disposal Agreement. (a) Sections 3.6(C) and 3.6(E) of the Original Waste Disposal Agreement are deleted and replaced in their entirety, as set forth below: "(C) Receipt of Imported Acceptable Waste on a Contract Basis. Throughout the Term hereof, the County shall have the right to enter into a contract or other agreement with any municipal or private non - County entity for the delivery of Imported Acceptable Waste on terms and conditions that the County determines to be necessary to ensure and enhance the viability of the Disposal System for the benefit of the County and the Participating Cities and to generate Net Import Revenues. The County certifies that in its good faith judgment the contract or other agreement for the delivery of such waste will not materially and adversely affect the ability of the County to receive and dispose of Acceptable Waste from the Participating Cities in accordance with the applicable Disposal Agreements throughout the Term thereof. " "(E) Application and Use of Revenues From Other Users. (1) Throughout the term hereof, all revenues received by the County from the disposal of County Acceptable Waste by the Disposal System, and all revenues received by the County from the disposal of Imported Acceptable Waste by the Disposal System (including amounts received by the County as a result of the failure of contract counterparties to deliver minimum required amounts of Imported Acceptable Waste) , shall be deposited by the County in the County OC Waste & Recycling Enterprise Fund and shall constitute revenues of the Disposal System. Pursuant to the County's Plan of Adjustment, the County is entitled to receive net revenues (after payment of all costs attributable to the acceptance of such Imported Acceptable Waste at the Disposal System) ( "Net Import Revenues ") from the disposal of Imported Acceptable Waste by the Disposal System. Costs attributable to the disposal of Imported Acceptable Waste include deposits to the Environmental Fund, deposits to closure and postelosure reserves, City host fees (if applicable), operating costs (such as manpower expenditures, equipment, services and supplies expenditures), state surcharges, and a pro rata share of capital project costs. Net Import Revenues shall be used for the payment of bankruptcy related obligations until payment in full of such bankruptcy related obligations required to be paid from such Net Import Revenues pursuant to the Plan of Adjustment. It is estimated that payment in fall of such bankruptcy related obligations required to be paid from such Net Import Revenues pursuant to the Plan of Adjustment will occur by the end of Fiscal Year 2017 -18. (2) Until the County's obligation to apply Net Import Revenues for the payment of bankruptcy related obligations in accordance with the Plan of Adjustment has been satisfied in full, Net Import Revenues shall be calculated as provided in Section (3.6)(E)(l). For any period after the County's obligation to apply Net Import Revenues for the payment of bankruptcy related obligations in accordance with the Plan of Adjustment has been satisfied in full, Net Import Revenues shall be calculated as follows: (i) in Fiscal Year 2017 -18, Net Import Revenues for each ton of Imported Acceptable Waste received shall be equal to the revenues received for the disposal of such ton of Imported Acceptable Waste (excluding any newly established per -ton fees or increases to existing per -ton fees with respect to Imported Acceptable Waste payable to the State, other regulatory agencies or cities in which facilities in the Disposal System are located) in excess of $17.57 per ton; (ii) in Fiscal Year 2018 -19, Net Import Revenues for each ton of Imported Acceptable Waste received shall be equal to the revenues received for the disposal of such ton of Imported 2015 Amendment to Waste Disposal Agreement Acceptable Waste (excluding any newly established per -ton fees or increases to existing per -ton fees with respect to Imported Acceptable Waste payable to the State, other regulatory agencies or cities in which facilities in the Disposal System are located) in excess of $18.01 per ton; (iii) in Fiscal Year 2019 -20, Net Import Revenues for each ton of Imported Acceptable Waste received shall be equal to the revenues received for the disposal of such ton of Imported Acceptable Waste (excluding any newly established per -ton fees or increases to existing per -ton fees with respect to Imported Acceptable Waste payable to the State, other regulatory agencies or cities in which facilities in the Disposal System are located) in excess in excess of $18.46 per ton; and (iv) thereafter, Net Import Revenues shall be equal to 30% of the revenues received by the County from the disposal of Imported Acceptable Waste (excluding any newly established per -ton fees or increases to existing per -ton fees with respect to Imported Acceptable Waste payable to the State, other regulatory agencies or cities in which facilities in the Disposal System are located). (3) After the County's obligation to apply Net Import Revenues for the payment of bankruptcy related obligations in accordance with the Plan of Adjustment has been satisfied in full (i) 50% of any Net Import Revenues (as calculated pursuant to Section 3.6(E)(2)) shall be paid to the County General Fund; and (ii) 50% of such Net Import Revenues shall be paid to the Participating Cities (and to the County, with respect to the unincorporated area) listed in Appendix 5 for use for any purpose by the Participating City, including but not limited to state mandated solid waste programs. Payments of such amounts to the County General Fund and the Participating Cities shall be made by the County within 90 days after the end of each fiscal year. The portion of Net Import Revenues specified above payable to the Participating Cities shall be apportioned in the percentages set forth in Appendix 5. (4) The percentages set forth in Appendix 5 with respect to each Participating City will be adjusted at the end of Fiscal Year 2019 -20 to reflect the percentage of actual deliveries of Acceptable Waste from each Participating City as compared to the total amount of actual deliveries from all of the Participating Cities during Fiscal Years 2017 -18, 2018 -19, and 2019 -20. The County shall notify each Participating City of the revised percentages in Appendix 5 within 120 days after the end of Fiscal Year 2019 -20. The revised percentages will be used for the allocation of Net Import Revenues generated during Fiscal Year 2020 -21 and thereafter. (b) Section 4.2(A)(z) is added to the Original Waste Disposal Agreement (immediately following Section 4.2(A)(y)) as follows: "(z) decrease the amount of Net Import Revenues otherwise payable to the County General Fund and the Participating Cities pursuant to Section 3.6(E)(2) and Section 3.6(E)(3) and use the amount of such decrease to pay costs of the Disposal System." (c) Section 6.1(A) and Section 6.1(B) of the Original Waste Disposal Agreement are deleted and replaced in their entirety with the following: 2015 Amendment to Waste Disposal Agreement "SECTION 6.1 EFFECTIVE DATE AND TERM (A) Initial Term. This Agreement shall continue in full force and effect until June 30, 2025, unless earlier terminated in accordance with its terms, in which event the Term shall be deemed to have expired as of the date of such termination. (B) Option to Renew, This Agreement shall be subject to renewal by mutual agreement of the parties, on or before June 30, 2023, for an additional term of ten years (the "Renewal Term") on the same terms and conditions as are applicable during the Initial Term hereof. The City shall give the County written notice of its irrevocable election to renew this Agreement on or before June 30, 2022. If the parties do not renew this Agreement by June 30, 2023, the Agreement shall expire on June 30, 2025." (d) The first sentence of Section 6.1(C) of the Original Waste Disposal Agreement is deleted in its entirety and replaced with the following: "In connection with the parties' right to renew this Agreement for an additional ten -year term pursuant to Section 6.1(B), the parties shall, on or before June 30, 2023, negotiate an applicable change in the Contract Rate for such renewal term." (e) Appendix 2 of the Original Waste Disposal Agreement is deleted in its entirety and replaced with the form attached hereto. (f) Appendix 5 shall be added to the Original Waste Disposal Agreement as a new appendix, in the form attached hereto. (g) All other terms and conditions of the Original Waste Disposal Agreement shall remain in full force and effect. Section 2. Initial Payment. As consideration for the execution of this Amendment by all of the Participating Cities, and subject to the occurrence of the Amendment Effective Date pursuant to Section 3, the County agrees to pay, from the County OC Waste & Recycling Enterprise Fund, the Amendment Payment to the Participating Cities listed in Appendix 5. The aggregate Amendment Payment shall be $5,400,000, and shall be distributed to the individual Participating Cities (including the City) in the percentages set forth in Appendix 5 by September 30, 2016. Section 3. Effectiveness of Amendment. The provisions of this Amendment shall not become effective unless and until the Amendment has been executed by the County and all of the Participating Cities. The date on which all of the Participating Cities have executed the Amendment shall be the "Amendment Effective Date." The County shall give written notice of the Amendment Effective Date to the City. In the event that the Amendment Effective Date does not occur by June 30, 2015, this Amendment shall be automatically terminated and the County shall have no obligation to make the Amendment Payment; provided, however that the County Board of Supervisors may extend such automatic termination date to a date no later than September 30, 2015. 2015 Amendment to Waste Disposal Agreement Section 4. REPRESENTATIONS AND WARRANTIES OF THE PARTIES. Each of the parties to this Amendment represent and warrant that it is a political subdivision of the State of California validly existing under the Constitution and laws of the State and (ii) it has duly authorized the execution and delivery of this Amendment, and has duly executed and delivered the Amendment. All other terms and conditions of the 2009 Original Waste Disposal Agreement not specifically changed by this Amendment, shall remain in full force and effect. IN WITNESS WHEREOF, COUNTY and CITY have caused this Amendment to be executed by their duly authorized officers or representatives as of the day and year first above written. Date APPROVED AS TO FORM: CITY AT O EY'S OFFICE Date: �� pp By VV� Aaron C. Harp City Attorney ATTEST: Date: IN Leilani I. Brown City Clerk APPROVED AS TO FORM: COUNTY COUNSEL ORANGE COUNTY, CALIFORNIA Date 2015 Amendment to Waste Disposal Agreement COUNTY OF ORANGE By Director, OC Waste & Recycling CITY OF NEWPORT BEACH, a California municipal corporation Date: By: Edward D. Selich Mayor APPENDIX 2 County Acceptable Waste Tonnage Target to be Used for Purposes of Section 4.2(b) Fiscal Year FY 2015 -16 FY 2016 -17 FY 2017 -18 FY 2018 -19 FY 2019 -20 FY 2020 -21 FY 2021 -22 FY 2022 -23 FY 2023 -24 FY 2024 -25 2015 Amendment to Waste Disposal Agreement Tonnage Cumulative 2,724,250 2,724,250 2,681,153 5,405,403 2,638,746 8,044,149 2,597,017 10,641,166 2,558,522 13,199,688 2,520,605 15,720,293 2,483,256 18,203,549 2,483,256 20,686,805 2,483,256 23,170,061 2,483,256 25,653,317 APPENDIX PARTICIPATING CITY ALLOCATION PURSUANT TO SECTION 3.6 Cit Allocation Percentage for Allocation of Purposes of Section 3.6 Initial Payment Anaheim 13.18% $711,509 Aliso Viejo 0.67 36,416 Buena Park 2.34 126,275 Brea 2.28 123,085 Costa Mesa 2.18 117,936 Costa Mesa Sanitary District 1.48 79,976 Cypress 2.56 138,115 Dana Point 0.99 53,278 Fullerton 4.10 221,271 Fountain Valley 1.76 95,217 Garden Grove( GG Sanitary District 7.17 387,197 Huntington Beach 6.13 330,807 Irvine 8.22 444,036 Laguna Beach 1.14 61,796 Laguna Hills 0.74 40,098 Laguna Niguel 1.36 73,341 Laguna Woods 0.41 22,274 La Habra 1.69 91,431 Lake Forest 2.45 132,214 La Palma 0.32 17,325 Los Alamitos 0.58 31,362 Mission Viejo 2.42 130,902 Newport Beach 3.68 198,946 Orange 4.90 264,468 Placentia 1.58 85,116 Rancho Santa Margarita 1.11 60,009 Santa Ana 10.60 572,184 San Clemente 1.40 75,728 San Juan Capistrano 1.23 66,420 Seal Beach 0.82 44,292 Stanton 1.62 87,287 Tustin 1.42 76,648 Villa Park 0.21 11,081 Midway City Sanitary District (Westminster) 2.13 114,893 Yorba Linda 1.78 96,344 County Unincorporated 3.35 180,723 Totals 100% $5,400,000 2015 Amendment to Waste Disposal Agreement STATE OF CALIFORNIA } COUNTY OF ORANGE } ss. CITY OF NEWPORT BEACH } I, Leilani I. Brown, City Clerk of the City of Newport Beach, California, do hereby certify that the whole number of members of the City Council is seven; that the foregoing resolution, being Resolution No. 2015 -26 was duly and regularly introduced before and adopted by the City Council of said City at a regular meeting of said Council, duly and regularly held on the 14`h day of April, 2015, and that the same was so passed and adopted by the following vote, to wit: AYES: Council Member Peotter, Council Member Petros, Council Member Curry, Council Member Duffield, Council Member Muldoon, Mayor Pro Tern Dixon, Mayor Selich NAYS: None IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the official seal of said City this 151h day of April, 2015. IX1�1�Y 11L � . G! /U "V �� City Clerk Newport Beach, California Jv (Seal)