HomeMy WebLinkAboutKey DisposalAMENDMENT NO. ONE TO
COMMERCIAL SOLID WASTE COLLECTION
NONEXCLUSIVE FRANCHISE AGREEMENT
BETWEEN THE CITY OF NEWPORT BEACH AND KEY DISPOSAL, INC.
THIS AMENDMENT NO. ONE TO COMMERCIAL SOLID WASTE
COLLECTION NONEXCLUSIVE FRANCHISE AGREEMENT ("Amendment No. One")
is made and entered into as of this 28th day of February, 2017 ("Effective Date"), by and
between the CITY OF NEWPORT BEACH, a California municipal corporation and
charter city ("City"), and KEY DISPOSAL, INC., a California corporation ("Franchisee"),
whose address is P.O. Box 459, Montebello, California 90640, and is made with
reference to the following:
RECITALS
A. On March 1, 2007, City and Franchisee entered into a Nonexclusive Franchise
Agreement for commercial solid waste collection services in the City
("Agreement").
B. The Agreement is set to expire on March 1, 2017.
C. The parties desire to enter into this Amendment No. One to extend the term of
the Agreement to November 8, 2017.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
Section 2 of the Agreement is amended in its entirety and replaced with the
following: "The term of this Agreement shall commence on the Effective Date, and shall
terminate on November 8, 2017 ("Termination Date"), unless terminated earlier as set
forth herein ("Term").
2. INTEGRATED CONTRACT
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
[SIGNATURES ON NEXT PAGE]
Key Disposal, Inc. Page 1
IN WITNESS WHEREOF, the parties have caused this Amendment No. One to
be executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTOFFICE
Date: a=
CITY OF NEWPORT BEACH,
a California municipal corporation
Date: �VA
By: By:
Aaron C. Harp N ti tti t'% Dave`W iff
City Attorney City Manager
ATTEST:
Date: 141 11
1, 1.17v'rzan f�
BrownLellani
City Clerk
FRANCHISEE: KEY DISPOSAL, INC., a
Californiagr ratio
Date: d/
Nifim UP121 7 ��
Shelline Katagian 0
Chief Executive Officer and Chief
Financial Officer
[END OF SIGNATURES]
Key Disposal, Inc. Page 2
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AMENDMENT NO. 1
TO COMMERCIAL SOLID WASTE COLLECTION
NONEXCLUSIVE FRANCHISE AGREEMENT BETWEEN THE CITY OF
NEWPORT BEACH AND KEY DISPOSAL
THIS AMENDMENT NO. 1 TO COMMERCIAL SOLID WASTE FRANCHISE
AGREEMENT, is entered into as of this 18th day of March, 2008, by and between the CITY OF
NEWPORT BEACH, a Municipal Corporation ( "CITY "), and KEY DISPOSAL ( "FRANCHISEE "),
and is made with reference to the following:
RECITALS:
A. On March 1, 2007 CITY and FRANCHISEE entered into a Commercial Solid
Waste Nonexclusive Franchise Agreement, hereinafter referred to as
"AGREEMENT".
B. The CITY is currently is currently in negotiations with the County of Orange over
the tipping fee charged for the disposal of solid waste. To obtain a more
favorable rate from the County of Orange for all Franchisees, the City must
require Franchisees to deliver all residual solid waste materials (materials that
are not delivered to a recycling facility) to a landfill /disposal site owned and /or
operated by the County of Orange.
C. CITY and FRANCHISEE mutually desire to amend AGREEMENT, hereinafter
referred to as "AMENDMENT NO. 1, as provided here below.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as
follows:
Section 6(B) of the Agreement shall be amended to delete the first sentence and
replace it with the following:
"Franchisee shall dispose of solid waste collected or transported by Franchisee
only by taking such solid waste to a Orange County certified /licensed landfill,
State certified /licensed transfer station, State certified /licensed recycling facility
or State certified /licensed materials recovery facility which is lawfully authorized
to accept that specific type of solid waste material."
2. Section 6(c) of the Agreement shall be amended to delete the last sentence and
replace it with the following:
"Failure to comply with the recycling /diversion requirements and delivery/disposal
of materials in accordance to the designated certified /licensed facility shall be a
material breach of this agreement."
3. Except as expressly modified herein, all other provisions, terms, and covenants
set forth in AGREEMENT shall remain unchanged and shall be in full force and
effect.
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IN WITNESS WHEREOF, the parties hereto have executed this AMENDMENT NO. 1
on the date first above written.
APPROVED AS TO FORM: CI
/ A
1 I \,.- - U - B)
City Attorney
for the City of Newport Beach
ATTEST:
for the City of Newport Beach
FRANCHISEE:
By: C/�hL �/ , /b ✓2 By:,
LaVonne Harkless, Corp ate Officer)
City Clerk
"e:VpoRT Title:
x` h aca d►
PriZNeQ (�
x
By:
(h6ancial Officer)
Ll
ACCEPTANCE OF SOLID WASTE MANAGEMENT FRANCHISE
WHEREAS, on March 27, 2007, the City Council of the City of Newport Beach
adopted Ordinance No. 2007 -7 entitled an Ordinance of the City Council of the City of
Newport Beach Granting a Non - Exclusive Solid Waste Franchise to Franchisees to
Provide Solid Waste Collection Services Upon the City Streets and Within the City of
Newport Beach and
WHEREAS; the Charter of the City of Newport Beach; Section 1303, and
Ordinance No. 2007 -7. provide that any franchise granted shall not become effective until
written acceptance is filed by the Grantee with the City Clerk. The acceptance shall be
filed within ten (10) days after the adoption of Ordinance No., 2007 -7.
WHEREAS; the undersigned Grantee wishes to accept the grant of the Franchise
NOW THEREFORE, k2y _biTi J tl C hereby
accepts the grant of the Nonexclusive Franchise granted by Ordinance No. 2007 -7 and
hereby agrees to comply with the provisions of the Newport Beach Charter, Chapter
12.63, Ordinance No. 2007 -7_ and the Franchise Agreement in all its operations, pursuant
to the grant of the Franchise.
Im.
TITLE:
CITY CLERKS'S VERIFICATION OF ACCEPTANCE
I; LaVonne M. Harkless�City Clerk certify that the above acceptance of Franchise was
received by me on r p(�r / 2007, at
LIJIVAKOIRMA � =-04
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COMMERCIAL SOLID WASTE COLLECTION
NONEXCLUSIVE FRANCHISE AGREEMENT BETWEEN THE CITY OF
NEWPORT BEACH AND SOLID WASTE HAULERS LISTED IN EXHIBIT A.
This Nonexclusive Franchise Agreement for Commercial Solid Waste Handling Services
( "Agreement ") is entered into this I' day of March 2007 ( "Effective Date ") by and between the
CITY OF NEWPORT BEACH, a municipal corporation and Charter City organized and existing
under the laws of the State of California ( "City"), and Key Disposal, a California Corporation,
whose address is 1141 S. Taylor Avenue, Montebello, California, 90640 ( "Franchisee ") and is
made with reference to the following:
RECITALS
This Agreement is entered into on the basis of the following facts:
A. Franchisee has provided or is capable of providing commercial solid waste
collection services in the City.
B. Pursuant to Article XIII of the City Charter, Chapter 12.63 of the City of Newport
Beach Municipal Code ( "Code "), and Sections 49300 and 49500 -49523 of the Public Resources
Code, the City is authorized to enter into nonexclusive franchise agreements for commercial
solid waste handling services.
C. Pursuant to this Agreement, City desires to authorize Franchisee to provide
nonexclusive commercial :solid waste handling services within the City. Franchisee shall furnish
all personnel, equipment, and supplies necessary to collect, transport, or otherwise remove and
dispose of solid waste and recyclable materials from commercial, institutional, or industrial
premises within the City.
D. The City Council has determined that the grant of a nonexclusive franchise is in
the public interest.
NOW, THEREFORE, CITY AND FRANCHISEE DO HEREBY AGREE AS
FOLLOWS:
SECTION 1. GRANT OF FRANCHISE
A. By Ordinance No. 2007 -7, City has granted to Franchisee a nonexclusive
franchise authorizing, Franchisee to provide commercial solid waste handling services for solid
waste kept, accumulated, or generated in the City of Newport Beach and to use the public streets
and public right -of -ways for such purpose ( "Franchise "). Franchisee acknowledges that the
Franchise is not exclusive and that the Franchise is subject to the provisions of Article XIII of the
City Charter, Ordinance No. 2007 -7, Chapter 12.63 of the Code, and the terms and conditions of
this Agreement.
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B. Upon the Effective Date of this Agreement, the parties agree that any prior
authorization relating to the conduct of commercial solid waste handling services in the City
arising under and pursuant to any prior franchise issued to Franchisee shall be deemed to be
terminated and of no further force or effect.
SECTION 2. TERM OF FRANCHISE
The term of this Agreement shall commence on the Effective Date, and shall terminate on
the 1st day of March, 2017 ( "Termination Date "), unless terminated earlier as set forth herein
("Term").
SECTION 3. DEFINITIONS
Unless otherwise defined herein, or if the use or context clearly requires a different
definition, all words, terms and phrases in this Agreement and the derivations thereof shall have
the meanings set: forth in Section 12.63.020 of the Code.
SECTION 4. FRANCHISE FEES
A. During the term of the Franchise, Franchisee shall pay to City franchise fees for
the privilege of providing commercial solid waste handling services in the City of Newport
Beach and for the use of public streets, right -of -ways and places for such purposes. The
franchise fee that Franchisee shall pay to the City shall be ten and a half percent (10.5 %) of the
gross receipts for all commercial solid waste handling services provided by the Franchisee in the
City of Newport Beach ( "Franchise Fees "). One half percent (.5 %) of the Franchise Fee shall be
attributable to the maintenance and implementation of the City's Source Reduction and Recycling
Element "SRRE," and shall be separately accounted for, and used only for the costs stated in
Public Resources Code Section 41901 or any successor provision.
B Franchise Fees shall be paid quarterly on forms prescribed by the Administrative
Services Director.
C. Franchisee shall pay all required' Franchise Fees to:
City of Newport Beach
Attn: Administrative Services Director
3300 Newport Boulevard
Newport Beach, CA 92658
D. Franchise Fees shall be due and payable on the thirtieth (30th) day of the month
following, the end of each quarter. Because the Effective Date for this Agreement is starting in
the middle of a quarter, the first payment of the Franchise Fees due and payable to the City from
the Effective Date to the end of the first quarter (i.e. March 31, 2007) will be due and payable on
the thirtieth (30th) day of April 2007.
E. The parties hereto agree that Franchisee's failure to make Franchise Fee and
Environmental Liability Fund Fee, as set forth in Section 8 (hereinafter the Franchise Fee and
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E. The parties hereto agree that Franchisee's failure to make Franchise Fee and
Environmental Liability Fund Fee, as set forth in Section 8 (hereinafter the Franchise Fee and
Environmental Liability Fund Fee shall collectively be referred to as "Fee(s) "), payments within
the time allowed will result in damages being sustained by City. Such damages are, and will
continue to be, impracticable and extremely difficult to determine. If Fees are not paid by
Franchisee when due then in addition to the Fees, Franchisee shall pay a late charge in an amount
equal to ten percent (10 %) of the amount of the Fee that was not timely paid by Franchisee. If
Franchisee fails to pay delinquent Fees within thirty (30) days of the date due, Franchisee shall
pay a second (2 ") late charge in an amount equal ten percent (10 %) on both the amount of the
Fee outstanding and the first late charge. The second (2na) late charge shall be in addition to the
first (1st) late charge. Execution of this Agreement shall constitute agreement by the parties that
the late charges set forth in this subsection is the minimum value of the costs and actual damages
caused by the failure of the Franchisee to pay the Fees within the allotted time. Such sum is
liquidated damages and shall not be construed as a penalty.
In addition to the late charges imposed on Franchisee for failing to pay Fees in
accordance with this Agreement; Franchisee shall pay interest on the amount of Fees and late
charges due and owing at the rate of one and one -half percent (I %2 %) per month for each month
or portion of a month that the Fees and late charges remain unpaid.
F. In the event Franchisee believes that it has paid Fees in excess of the Fees due to
City, Franchisee may :submit a request for refund to the Administrative Services Director on a
form provided by the Director. If proof of overpayment is satisfactory to the Director, the
Director shall refund to Franchisee any overpayment. Franchisee shall not apply any
overpayment as a credit against any other amounts payable to City unless specifically authorized
by the Administrative Services Director in writing.
G. Each Franchise Fee payment shall be accompanied by a written statement
described in Section 12.63.090 of the Code on a form provided by the Administrative Services
Director. No statement filed under this Section shall be conclusive as to the matters set :forth in
such statement, nor shall the filing of such statement preclude the City from collecting by
appropriate action the sum that is actually due and payable.
H. Franchisee may separately list the actual Franchise Fee rate and Environmental
Liability Fund Fee rate as established by this Section, and any other fees required by this
Agreement, on its invoices to its customers. In no case may the Franchise Fee rate or
Environmental Liability Fund Fee rate listed by the Franchisee on the invoice exceed the actual
Franchise Fee or Environmental Liability Fund Fee rates imposed by the City.
SECTION 5. CASH DEPOSIT
Franchisee shall, prior to the placement of any commercial solid waste container on
public property, provide City with a cash deposit in the sum of Five Thousand Dollars
($5,000.00) to ensure compliance with the duties and obligations imposed by the provisions of
the Code, regulations adopted by the City Manager or his designee and this Agreement.
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SECTION 6. DISPOSAL OF SOLID WASTE
A. Franchisee shall comply with all recycling and diversion requirements imposed by
law, ordinance, or regulation on the City and/or Franchisee. On a quarterly basis Franchisee shall
divert solid waste collected from landfills as follows: Year 1: fifty percent (50 %); Year 2: fifty-
one percent (51 %); Year 3: fifty -two percent (52 %); Year 4: fifty -three percent (53 %); Year 5:
fifty -four percent (54 %); Years 6 -10: fifty -five percent (55 %). In no event shall Franchisee
deposit more solid waste at any landfill during any calendar quarter than the required diversion
rate mandated by the City. In the event new or additional diversion requirements are imposed by
law, ordinance or regulation on City and/or Franchisee, the City shall have the right to require
Franchisee to divert additional solid waste from landfills by providing Franchisee with ten (10)
days written notice of the new diversion requirements. Upon request of the General Services
Director, Franchisee shall provide all documents and information requested by the General
Services Director to prove that Franchisee has complied with this subsection, any applicable law,
ordinance, regulation, or condition related to recycling and diversion of solid waste.
B. Franchisee shall dispose of solid waste collected or transported by Franchisee only
by taking such solid waste to a State certified/licensed landfill, State certified/licensed transfer
station, State certified/licensed recycling facility or State certified/licensed materials recovery
facility which is lawfully authorized to accept that specific type of solid waste material.
Franchisee shall not dispose of solid waste by depositing it on any land, (except a permitted
facility) whether public or private, or in any river, stream or other waterway, or in any sanitary
sewer or storm drainage system. Nothing in this Agreement shall be deemed or construed as
authorizing Franchisee to operate .a. landfill, recycling center, or other solid waste disposal
facility.
C. All solid waste, in addition to recyclables, collected by Franchisee shall become
the property of Franchisee upon placement: by the customer for collection. If Franchisee violates
the terms in Section 6(A) and Section 6(B) above, Franchisee agrees that the City has the future
right to direct that solid waste be delivered to a permitted disposal facility designated by City.
This exercise of "flow control" by the City shall be made upon at least 30 days prior written
notice to Franchisee, and written notice shall include the violation(s) prompting the City's action
regarding "flow control." Failure to comply with the recycling/diversion requirements and
delivery /disposal of materials to a certified/licensed facility shall be a material breach of this
agreement.
D. Franchisee shall include as a condition to its contractual agreement with its
customers a provision prohibiting disposal of hazardous waste in any of Franchisees vehicles or
disposal bins /containers, and other equipment.
E. Franchisee shall implement a load check program that includes, at a minimum, a
visual cheek of all containers to be emptied to protect against inclusion of hazardous waste and
shall prepare a written record of all hazardous waste discovered during the process. The records
shall comply with all State and Federal Hazardous Waste Regulations, shall be maintained for the
length of the term of the Franchise, and shall be made available to the City upon request.
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SECTION 7. REPORTS
A. Franchisee shall submit to City monthly reports stating the total amount (in tons)
of solid waste which Franchisee collected in the City of Newport Beach during the reportable
month; the total weight (in tons) of solid waste disposed of by Franchisee at landfills and transfer
stations which Franchisee collected in the City of Newport Beach during the reportable month;
the total weight and the weight by material category (in tons) of solid waste disposed of by
Franchisee at recycling and materials recovery facilities during the reportable month which
Franchisee collected in the City of Newport Beach; the name and location of all solid waste and
recycling facilities where City of Newport Beach materials were delivered; such other tonnage or
other information as requested by the General Services Director including weigh tickets,
recycling records; and any complaints received by the Franchisee. Such monthly reports shall be
prepared on such form as required by the General Services Director. Each monthly report shall
be submitted on or before the 15th day of the month following the end of the month (i.e. report
due April 15 for first month after the Effective Date) and submitted to:
General Services Director
City of Newport Beach
3300 Newport Blvd.
Newport Beach, CA 42663
B. If the report required under Subsection A is not filed by the due date specified
above, the report shall be deemed delinquent. If the report remains delinquent for more than
fifteen (15) days, Franchisee shall pay to City a delinquent report charge in the amount of One
Hundred Dollars ($100). If the report remains delinquent for more than forty -five (45) days,
Franchisee shall pay to City a delinquent report charge in the amount of Five Hundred Dollars
($500). Such delinquent report charges shall be in addition to any Franchise Fees or other
charges payable by Franchisee under this Agreement.
C. Franchisee shall comply with all recycling and diversion requirements imposed by
law, ordinance, or regulation on the City. Monthly reports stating the total amount (in tons) of
solid waste which Franchisee landfilled, recycled and collected should accurately reflect the
diversion rate required by the City (Year 1- 50 %, Year 2- 51 %, Year 3- 52 %, Year 4- 53 %, Year
5- 54 %, Years 6 -10- 55 %v). At the end of each quarter, monthly reports will be evaluated for
compliance with City diversion requirements. Failure to comply with the recycling and diversion
requirements shall be a material breach of this Agreement.
SECTION 8. ENVIRONMENTAL LIABILITY FUND FEE
A. City and Franchisee acknowledge the potential liability which can result from
commercial solid waste handling services under Federal and State environmental laws. City
intends to take reasonable actions to obtain protection and indemnification against future
environmental liability for solid waste generated within the City of Newport Beach and the
activities of Franchisee under this Agreement for handling such solid waste. To provide
protection and indemnification to City for Franchisee's solid waste handling activities in the City
of Newport Beach, Franchisee agrees to collect from its customers a fee for payment into an
Environmental Liability Fund which shall be a separate Fund established and maintained by City.
The Fund shall be used to purchase insurance which will insure the City against environmental:
liability which may be imposed upon City as a result of Franchisee's activities under this
Franchise and/or shall be used to pay environmental liability costs and expenses arising from or
related in any way to commercial solid waste handling services. The Fund shall not be
commingled with or included in the City s General Fund.
B. The fee that Franchisee shall pay to the City Environmental Liability Fund shall
be five and a half percent (5.5 %) of the gross receipts for all commercial solid waste handling
services provided by the Franchisee in the City of Newport Beach ( "Environmental Liability
Fund Fee(s) ").. Payment of the Environmental Liability Fund Fee shall be made concurrently
with the payment of the Franchise Fees specified in Section 4 of this Agreement. Franchisee
agrees to pay late charges and interest as provided in Section 4(E) of this Agreement if
Franchisee fails to pay the Environmental Liability Fund Fee within the time frames set forth
herein.
C. Compliance with this obligation shall not limit Franchisee's indemnification as set
forth in Section 11, however, the indemnification provisions of I I(C) shall be secondary to the
Fund established by this Section or any insurance purchased with the funds provided.
SECTION 9. FRANCHISEE'S RECORDS
A. Franchisee shall keep and maintain books of account, income statements, tonnage
reports and supporting documents and all other documents that relate in any way to business
transactions conducted by Franchisee in connection with the commercial solid waste handling
services of Franchisee under this Agreement during the Term of this Agreement and for a
minimum period of three (3) years, or for any longer period required by law, after the
Termination Date. Such records shall be kept at Franchisee's place of business and shall be
clearly identifiable
B. Franchisee shall allow a representative of City to examine, audit and make
transcripts or copies of the books of account, income statements, tonnage reports and supporting
documents, and all other documents that relate in any way to business transactions conducted by
Franchisee in connection with the commercial solid waste handling services of Franchisee under
this Agreement at Franchisee's place of business during normal business hours within three (3)
working days of the City Manager, or his designees request or demand to inspect and/or audit
these records. The purpose of such inspection and/or audit shall be for verification of the Fees
paid by Franchisee under this Agreement, and the accuracy thereof; and for verification of the
amounts of solid waste reported by Franchisee pursuant to this Agreement. Franchisee's books of
account, "income statements, tonnage reports and other documents accessed by City shall be kept
confidential unless these documents are deemed necessary by City to enforce the terms of this
Agreement or are required to be produced pursuant to any applicable law.
C. The parties agree that Franchisee's failure to provide its records in accordance
with City's request to examine, audit and make transcripts or copies of the books of account,
income statements, tonnage reports and supporting documents in accordance with Subsection B
above, shall be considered a material breach of this Agreement and will result in damages being,
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sustained by City. Such damages are, and will continue to be, impracticable and extremely
difficult to determine. The parties agree that if Franchisee fails to provide its records in
accordance with Subsection B above, the City may, in its discretion terminate this Agreement .
and/or charge .a. late charge in the amount of Two Hundred Fifty and No /100 Dollars ($250.00)
for each working day that Franchisee does not provide said records. Execution of this Agreement
shall constitute agreement by the parties that the late charge set forth in this subsection is the
minimum value of the costs and actual damages caused by the failure of the Franchisee to
provide records in accordance with Subsection B above. Such sum is liquidated damages and
shall not be construed as a penalty.
D. Franchisee shall reimburse City for City's costs in performance of an audit if, as a
result of the audit it is determined:
I. There was any intentional misrepresentation by Franchisee with respect to
the amount of Fees due to the City; or
2. There is a one thousand dollars ($1,000.00) or greater discrepancy in the
amount of Fees due to the City.
Such reimbursement shall be paid by Franchisee within thirty (30) days of the date City
notifies Franchisee in writing, that the Franchisee is liable to reimburse the City in conformance
with this subsection and the amount of City's audit costs.
E. If Franchisee refuses to provide City's auditor with its records as required by
Subsection B above or disagrees with City's audit findings, then Franchisee may, within ten (10)
days after written request by City's designated representative for records disclosure, or within ten
(10) days after service of the audit finding, appeal the imposition of late charge or the audit
findings by filing a written appeal with the City Council specifying the basis of Franchisee's
failure to provide records, or the reason for its disagreement with City's audit findings. If
Franchisee fails to timely request such an appeal to the City Council, then the late charges and/or
discrepancy determinations shall be final and conclusive and the amounts shall become
immediately due and payable and/or the violation shall be deemed established.
SECTION 10. INSURANCE REQUIREMENTS
Without limiting Franchisee's indemnification of City, Franchisee shall obtain, provide
and maintain at its own expense during the term of this Agreement, a policy or policies of
liability insurance of the type and amounts described below and in a form satisfactory to City.
A. Certificates of Insurance. Franchisee shall provide certificates of insurance with
original endorsements to City as evidence of the insurance coverage required herein. Insurance
certificates must be approved by City's Risk Manager prior to commencement of the Franchise.
Current certification of insurance shall be kept on file with City at all times during the term of
this Agreement.
B. Signature. A person authorized by the insurer to bind coverage on its behalf shall
sign certification of all required policies.
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C. Acceptable Insurers. All insurance policies shall be issued by an insurance
company currently authorized by the Insurance Commissioner to transact business of insurance in
the State of California, with an assigned policyholders' Rating of A (or higher) and Financial
Size Category Class VII (or larger) in accordance with the latest edition of Best's Key Rating
Guide, unless otherwise approved by the City's Risk. Manager.
D. Coverage Requirements.
1. Workers' Compensation Coverage. Franchisee shall maintain Workers'
Compensation Insurance and one million dollars ($1,000,000) Employer's Liability Insurance for
his or her employees in accordance with the laws of the State of California. Any notice of
cancellation or non - renewal of all Workers' Compensation policies must be received by City at
least thirty (30) calendar days (10 calendar days written notice of non - payment of premium) prior
to such change. The insurer shall agree to waive all rights of subrogation against City, its
officers, agents, employees and volunteers for losses arising from work performed by Franchisee
that relates in any way to this Agreement.
2. General Liability Coverage. Franchisee shall maintain commercial general
liability insurance in an amount not less than one million dollars ($1,000,000) per occurrence for
bodily injury, personal injury, and property damage, including without limitation, contractual
liability. If commercial general liability insurance or other form with a general aggregate limit is
used, either the general aggregate limit shall apply separately to the work to be performed under
this Agreement, or the general aggregate limit shall be at least twice the required occurrence
limit.
3. Automobile Liability Coverage. Franchisee shall maintain automobile
insurance covering bodily injury and property damage for all activities of the Franchisee arising
out of or in connection with work to be performed under this Agreement, including coverage for
any owned, hired, non -owned or rented vehicles, in an amount not less than two million dollars
($2,000,000) combined single limit for each occurrence.
E. Endorsements. Each general liability and automobile liability insurance policy
shall be endorsed with the following specific language:
1. The City, its elected or appointed officers, officials, employees, agents and
volunteers are to be covered as additional insureds with respect to liability arising out of work
performed by or on behalf of the Franchisee.
2. This policy shall be considered primary insurance as respects to City, its
elected or appointed officers, officials, employees, agents and volunteers as respects to all claims,
losses, or liability arising directly or indirectly from the Franchisee's operations or services
provided to City. Any insurance maintained by City, including any self - insured retention City
may have, shall be considered excess insurance only and not contributory with the insurance
provided hereunder.
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3. This insurance shall act for each insured and additional insured as though a
separate policy had been written for each, except with respect to the limits of liability of the
insuring company.
4. The insurer waives all rights of subrogation against City, its elected or
appointed officers, officials, employees; agents and volunteers.
5. Any failure to comply with reporting provisions of the policies shall not
affect coverage provided to City, its elected or appointed officers, officials, employees, agents or
volunteers.
6. The insurance provided by this policy shall not be suspended, voided,
canceled, or reduced in coverage or in limits, by either party except after thirty (30) calendar days
(10 calendar days written notice of non - payment of premium) written notice has been received by
City.
F. Timely Notice of Claims. Franchisee shall give City prompt and timely notice of
claims) made or suit instituted arising out of or resulting from Franchisee's performance under
this Agreement.
G. Additional Insurance. Franchisee shall also procure and maintain, at its own cost
and expense, any additional kinds of insurance, which in its own judgment may be necessary for
its proper protection and prosecution of the work.
SECTION 11. RESPONSIBILITY FOR DAMAGES AND INJURY /INDEMNIFICATION
A: Franchisee Responsibility. Franchisee shall be responsible for any damages
caused as a result of Franchisees acts or omissions including, but not limited to injuries to or
death of any person or damage to public and/or private property and damages public
improvements as a result of Franchisees placement and retrieval of the commercial solid waste
containers.
B. General Indemnification. Franchisee shall indemnify, hold harmless, and defend
City, and each of its past, present and future elected officials, officers, employees, agents,
consultants, volunteers, affiliates, assignees, representatives, attorneys, :subsidiaries, and
affiliated entities and their respective successors, heirs and assigns (collectively, "Indemnified
Parties ") harmless for, from and against any costs, expenses, damages, and losses, including
actual attorneys fees ( "Losses') of any kind or character to any person or property arising directly
or indirectly from or caused by any of the following: (i) any act or omission of Franchisee or its
respective officers, directors, shareholder members, partners, employees, agents, contractors,
subcontractors, suppliers, representatives and affiliates ( "Franchisee Representatives "); (ii)
Franchisee's or Franchisee Representative's activities; (iii) any accident or casualty within or
arising out of the services /work performed under the Franchise and/or this Agreement; (iv) any
violation or alleged violation of any law, ordinance or statute now or hereafter enacted arising out
of services /work performed pursuant to the Franchise and/or this Agreement; (v) the negligence
or willful misconduct of Franchisee or any of Franchisee representatives in the performance of
9
• •
the services/work under the Franchise and/or this Agreement; and (vi) any breach of the
Franchise and/or this Agreement.
Franchisee shall not be required to indemnify, hold harmless and defend the Indemnified
Parties from the sole negligence., active negligence or willful misconduct of the Indemnified
Parties. Nothing in this indemnity shall be construed as authorizing any award of attorney's fees
in any action on or to enforce the terms of this Agreement. This indemnity shall apply to all
claims and liability regardless of whether any insurance policies are applicable. The policy limits
do not act as a limitation upon the amount of indemnification to be provided by the Franchisee.
C. Hazardous Substances Indemnification. Franchisee shall indemnify the
Indemnified Parties from and against all claims; actual damages including, but not limited to,
special and consequential damages, natural resource damage, punitive damages, injuries, costs,
response, remediation, and removal costs, losses, demands, debts, liens, liabilities, causes of
action, suits, legal or administrative proceedings, interest, fines, charges, penalties and expenses
attorneys' and expert witness fees and costs incurred in connection with defending against any of
the foregoing or in enforcing this indemnity of any kind whatsoever paid, incurred or suffered by,
or asserted against, the Indemnified Parties or Franchisee arising directly or indirectly from or
caused by any of the following: (i) the violation of any Environmental Laws or the failure to clean
up and mitigate the consequences of the spill or release of any Hazardous Substance; and (ii)
Franchisee's activities under this Agreement concerning any Hazardous Substance at any place
where Franchisee stores or disposes of solid or hazardous waste pursuant to this Agreement, or
preceding Agreements between City and Franchisee. The foregoing indemnity is intended to
operate as an agreement pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act 42. U.S.C. Section 9607(e) and any amendments thereto; California, Health and
Safety Code Section 25364, to insure, protect, hold harmless, and indemnify City from liability.
As used herein, the term "Environmental Laws" shall mean "any and all present and
future federal, state or local laws (whether common law, statute, rule, regulation or otherwise),
permits, orders and any other requirements of Governmental Authorities relating, to the
environment or any "Hazardous Substance" or "Hazardous Substance Activity" (as defined
herein) (including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 U.S.C. §§ 9601 et seq.) as amended from time to
time and the applicable provisions of the California Health and Safety Code and California Water
Code).
As used herein, the term "Hazardous Substance" shall mean "any (a) chemical,
compound, material, mixture or substance that is now or hereinafter defined or listed in, or
otherwise classified pursuant to any Environmental Law as a "hazardous substance ", "hazardous
material," "hazardous waste," "extremely hazardous waste," "infectious waste," "toxic waste,"
"toxic pollutant," or any other formulation intended to define, list or classify substances by
reason of deleterious properties or affect and (b) petroleum, petroleum by- products, natural gas,
natural gas liquids, liquefied natural gas, synthetic gas usable for fuel (or mixtures of natural gas
in such synthetic gas), ash, municipal solid waste steam, drilling fluids, produced waters and
other wastes associated with the exploration, development and production of crude oil, natural
gas or geothermal resources"
10
D. AB939 Indemnification. Franchisee agrees to meet all requirements of City's
Source Reduction and Recycling Element as to the portion of the solid waste :stream handled by
Franchisee. Franchisee agrees to protect, defend, indemnify, and hold City harmless against all
fines or penalties imposed by the California Integrated Waste Management Board, or other entity;
arising from the failure of Franchisee to meet the Integrated Waste Management Act diversion
requirements with respect to the portion of the commercial waste stream collected by Franchisee.
E. Notice. City agrees to give notice to Franchisee when the City receives a claim
for damages or other liability for which Franchisee has provided indemnification under this
Section.
SECTION 12. COMMERCIAL SOLID WASTE COLLECTION SERVICES
A. Frequency of Collection. Franchisee shall collect all solid waste, including
recyclable materials, as authorized in this Agreement, on a schedule to be agreed upon between
the Franchisee and its customers. The schedule shall provide for collection service at least once
per week; provided, however, that such schedule shall not permit the accumulation of solid waste
in quantities that are unreasonable or detrimental to the public health or safety. Requests for
collection from premises with overflowing bins or containers, or from premises where there have
been missed pickups, shall be serviced. within 24 hours of any such request by the customer or
City. If requested by the City at any time, Franchisee's collection schedule shall be submitted to
the City for its approval.
B. Hours and Days of Collections. No collection of solid waste shall occur in any
area of the City after 6 :30 p.m. and prior to 5:00 a.m. No collection of solid waste from
commercial premises within 500 feet of occupied residential premises, motels or hotels shall be
made by Franchisee, nor shall any of Franchisee's collection vehicles be operated in any
residential areas of the City except between the hours of 7:00 a.m. and 6:30 p.m., Monday
through Friday, nor on any Saturday or Sunday, except between the hours of 8:00 a.m. and 6:00
p.m. Collection on Sundays shall be limited to the disposal of commercial waste from
commercial premises which require collection every day due to public health and safety
concerns.
SECTION 13. VEHICLES AND EQUIPMENT
A. Any and all containers provided to customers of Franchisee for storage, collection
or transportation of commercial solid wastes shall meet the requirements designated by the
General Services Director as well as State of California minimum standards for solid waste
handling established under Public Resources Code Section 43020 and applicable health
requirements.
B. All containers and all vehicles used by Franchisee in the performance of
commercial solid waste handling services shall be marked with Franchisee's name and telephone
number in letters which are not less than four inches (4') high or which are easily read by the
general public.
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C. Equipment.
1. Franchisee shall, at all times, provide such number of vehicles and such
equipment as will be adequate for the collection, transportation and disposal services which it is
authorized to provide under this Agreement. All vehicles utilized by Franchisee in the
performance of this Agreement shall be registered with the California Department of Motor
Vehicles. All vehicles must pass the required periodic `BIT" inspection and Franchisee shall
provide evidence of such to the General Services Department as requested. Upon request by the
City, Franchisee shall provide records from the most recent California Highway Patrol biennial
inspection of the terminal(s) responsible for the maintenance and repair of equipment used in the
City. All vehicles shall be properly maintained, kept clean and in good repair, and shall be
uniformly painted. All commercial solid waste containers used in the performance of this
Agreement shall be kept clean and in good repair and shall be uniformly painted to the
satisfaction of the General Services Director. All vehicles and equipment used by Franchisee in
the performance of this Agreement may be subject to inspection by the City upon twenty-four
(24) hours notice by the General Services Director. All drivers employed by Franchisee and
operating equipment in the City shall be properly licensed for the class of vehicle they drive,
enrolled in the Department of Motor Vehicles Employee Pull Notice (EPN) program, and abide
by all State and federal regulations for driver hours and alcohol and controlled substances testing.
2. Each vehicle shall be so constructed and used in a manner so that no
rubbish, garbage, debris, oil, grease or other material will blow, fall, or leak out of the vehicle.
All solid waste shall be transported by means of vehicles which are covered in such a manner as
to securely contain all solid waste and to prevent such solid waste from projecting, blowing,
falling or leaking out of the vehicles. Any solid waste dropped or spilled in collection, transfer or
transportation shall be immediately cleaned up by Franchisee. A broom and a shovel shall be
carried at all times on each vehicle for this purpose. In addition, each collection vehicle shall be
equipped with trash bags, masking tape and notice of non- collection tags for the purpose of
separating hazardous waste for return to the generator. A communications device such as a two -
way radio or a cellular telephone shall also be maintained on each vehicle at all times.
3. Franchisee shall not store any vehicle or equipment on any public street,
public right -of -way or other public property in the City of Newport Beach without obtaining a
Temporary Street Closure Permit from the Public Works Department and prior written consent of
the General Services Director.
4. Should the General Services Director at any time give written notification
to Franchisee that any vehicle does not comply with the standards hereunder, the vehicle shall be
promptly removed from service by Franchisee and not used again until inspected and authorized
in writing by the General Services Director.
5. Placement of containers and equipment shall be in accordance with the
standards set by the Director of Public Works and in accordance with the standards set forth in
Exhibit A which is incorporated herein by this reference. Any deviation from the standards set
by the Director of Public Works or the standards set forth in Exhibit A shall require written
approval from the Public Works Director.
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SECTION 14. ABANDONED CONTAINERS
A. If Franchisee abandons any commercial solid waste container within the City of
Newport Beach, the City may remove the container and/or dispose of the contents of the
container.
B. If City is required to remove a roll -off or compactor container abandoned by
Franchisee and/or disposes of the contents of any container abandoned by Franchisee, City may
charge Franchisee for City's costs incurred in such removal/disposal and for City's costs of
storage of the container. Franchisees who are engaged in providing roll -off containers shall
maintain a Five Thousand Dollars and No Cents ($5,000.00) cash deposit with City Revenue
Division to reimburse City for such costs within ten (10) days of the date of City's invoice for
such costs.
C. For the purposes of this Section, "abandoned" includes:
1. Franchisee's failure to remove the container within the time period
specified by the City Council upon termination of the Franchise pursuant to Section 12.63.140 of
the Code;
2. Franchisee's failure to remove the container within ten (10) working days
after the expiration of the Franchise granted to Franchisee, except in the case where Franchisee
has been granted an extension of the term of said Franchise or Franchisee has been granted a
subsequent franchise authorizing Franchisee to collect and transport the type or types of solid
waste for which the container was used pursuant to this Agreement.
3. Franchisee's failure to collect the container and dispose of the contents of
the container within five (5) calendar days after City's Director of General Services issues
written notice to Franchisee to dispose of the contents.
SECTION 15. COMPLIANCE WITH LAW
A. Franchisee shall perform all commercial solid waste handling services in
accordance with applicable federal, state, and local law, including Chapter 12.63 of the Code,
Article XIII of the City Charter, Ordinance No. 200 % -�_ and in accordance with the terms and
conditions of this Agreement.
B. During the Term of this Agreement, Franchisee and City agree that the City's
ordinances maybe amended as provided herein, as provided in Chapter 12.63 or as necessary to
permit the City to comply with changes to federal, state, and local legislative regulatory
requirements, which may affect or alter City's solid waste handling obligations or requirements
for solid waste management. Franchisee agrees to comply with any such amendment of the City's
ordinances.
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SECTION 16. PERMITS AND LICENSES
Franchisee shall obtain and maintain, at Franchisee's sole cost and expense, all permits
and licenses applicable to Franchisee's operations under the Franchise which are required of
Franchisee by any governmental agency. Payment of Franchise Fees and Environmental Liability
Fund Fees shall be in addition to any permit or license fees or business tax prescribed by the City
for the same period. ,
Franchisee shall obtain and maintain for the Term of this Agreement an account with the
Orange County landfills. If Franchisee disposes of solid waste at an Orange County landfills, the
Franchisee shall only dispose of Newport Beach solid waste at Orange County landfills utilizing
their account (no "cash only" disposal).
SECTION 17. PUBLIC EDUCATION ACTIVITIES
A. City and Franchisee shall cooperate in co- sponsoring not more than one
promotional event per year, as mutually agreed upon in advance by the parties, which is related to
the implementation of commercial solid waste handling services and recycling services.
B. Each year during the term of this Agreement, on an annual basis, Franchise shall
transmit promotional brochures or fliers to its customers, and to such prospective customers as it
may select, informing them of the commercial solid waste handling services and recycling
services which are provided by the Franchisee as well as hazardous waste disposal requirements.
C. All promotional brochures, fliers or other information distributed by Franchisee
hereunder shall be printed on recycled paper. All such informational materials shall be approved
in advance by the City's General Services Director.
SECTION 18. TERMINATION AND
A. The franchise granted to Franchisee may be terminated by the City Council
pursuant to Section 12.63.140 of the Code.
B. In the event the Franchise is terminated pursuant to Subsection A above or the
term of this Agreement expires:
1. Franchisee shall have no right or authority to engage in commercial solid
waste handling operations in the City of Newport Beach, subject to the provisions of Sections
49520 -49523 of the Public Resources Code.
2. Franchisee shall, however, remain liable to City for any and all Franchise
Fees and Environmental Liability Fund Fees that would otherwise be payable by Franchisee, for
any and all late charges and interest assessed pursuant to Section 4 of this Agreement, and for
any and all delinquent report/record charges assessed pursuant to Sections 7 or 9 of this
Agreement.
3. Franchisee shall have a continuing obligation to submit to City all reports
required by Sections 7 and 9 of this Agreement which relates to commercial solid waste handling
14
services performed by Franchisee up to and including the date of termination, suspension, or
expiration.
4. Franchisee shall allow the solid waste generators served by Franchisee to
arrange for commercial solid waste handling services with a solid waste enterprise collector
authorized to perform such services, without penalty or liability for breach of contract on the part
of the generators, for such period of time as Franchisee is not authorized to perform such services
because of termination or suspension.
5. Franchisee agrees to continue to provide the indemnifications required in
this contract after its suspension or termination. Such indemnifications include, but are not
limited to, the hazardous materials indemnification and AB939 indemnification as set forth in
Section 11.
C. In the event this Franchise is terminated pursuant to Subsection A above, then
within the time period specified by the City Council, Franchisee shall remove all of Franchisee's
commercial solid waste containers, from all Franchisee's collection service locations and shall
properly dispose of all solid waste in such containers.
D. In the event the Franchise is terminated pursuant to Subsection A above or expires
without an extension of the term and without a grant of a subsequent franchise allowing
Franchisee to continue performing such services, then within ten (10) days of such termination or
expiration Franchisee shall either:
1. Submit to City's General Services Director a list of the names and
addresses of solid waste generators in Newport Beach for which Franchisee provided services as
of the date of termination or expiration (i.e. Franchisee's City of Newport Beach customer list);
or
2. Send written notification to each solid waste generator on Franchisee's
customer list that Franchisee is no longer authorized to provide commercial solid waste handling
services in the City of Newport Beach. Such notification shall be in the form provided by City's
General Services Director and shall be personally delivered or shall be sent by first class mail,
postage prepaid, to the customers' billing addresses. Franchisee shall submit to City's General
Services Director an affidavit, signed under penalty of perjury, stating that the required
notification has been provided by Franchisee to all of Franchisee's City of Newport Beach
customers.
SECTION 19. ASSIGNMENT
Franchisee shall not assign, sell, subcontract; transfer or otherwise delegate its authority
to perform any portion of the solid waste handling services or obligations under the Franchise
without prior express consent of the City Council. This prohibition includes any transfer of
ownership or control of Franchisee, or the conveyance of a majority of Franchisee's stock to a
new controlling interest. City's consent shall not be unreasonably withheld.
15
SECTION 20. MISCELLANEOUS PROVISIONS
A. Notices. Except as otherwise provided in this Agreement, all notices required by
this Agreement shall be given by personal service or by deposit in the United States mail, postage
pre -paid and return receipt requested, addressed to the parties as follows:
To: General Services Director
City of Newport Beach
3300 Newport Blvd.
Newport Beach, CA 92663
K ; i
Notice shall be deemed effective on the date personally served or, if mailed, three
(3) days after the date deposited in the mails.
B. Integrated Agreement. This Agreement represents the full and complete understanding
of every kind or nature whatsoever between the City and Franchisee, and all preliminary
negotiations and other agreements of any kind or nature are merged herein. No verbal agreement
or implied covenant shall be held to vary the provisions herein.
C. Amendments. This Agreement supersedes all prior agreements and
understandings between the parties and may not be modified or terminated orally, and no
modification, termination or attempted waiver of any of the provisions hereof shall be binding
unless in writing and signed by the party against whom the same is sought to be enforced.
D. Applicable Law, The laws of the State of California, and applicable Federal law,
shall govern this Agreement and all matters relating to it and any action brought relating to this
Agreement shall be adjudicated in a court of competent jurisdiction in the County of Orange,
E. Authori The parties signing below represent and warrant that they have the
requisite authority to bind the entities on whose behalf they are signing.
F. Severability: If any term or portion of this Agreement is held to be invalid, illegal,
or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions of this
Agreement shall continue in full force and effect.
G. Waiver. A waiver by either party of any breach, of any term, covenant or
condition contained herein shall not be deemed, to be a waiver of any subsequent breach of the
same or any other term, covenant or condition contained herein, whether of the same or a
difference character.
16
H. Interpretation. The terms of this Agreement.shall be construed in accordance with
the meaning of the language used and shall not be construed for or against either party by reason
of the authorship of this Agreement or any other rule of construction that might otherwise apply.
I. Equal Opportunity Employment. Franchisee represents that it is an equal
Opportunity employer and it shall not discriminate against any authorized subcontractor,
employee or applicant for employment because of race, religion, color, national origin, handicap,
ancestry, sex or age.
J. Compliance with Laws: Franchisee shall at its own cost and expense comply with
all statutes, ordinances, regulations and requirements of all .governmental entities, including
federal, state, county or municipal, whether now in force or hereinafter enacted. Franchisee
agrees to obtain a business license from the City in accordance with the Code. The parties hereto
agree that the Franchise and this Agreement are the only authorizations to conduct :solid waste
collection business in the City and that the issuance of a business license does not grant the
Franchisee a right to conduct solid waste collection or other business in the City.
K. Conflicts of Interest: Franchisee or its employees maybe subject to the provisions
of the California Political Reform Act of 1974 (the "Act "), which (i) requires such persons to
disclose any financial interest that may foreseeably be materially affected by the work performed
under this Agreement, and (ii) prohibits such persons from making, or participating in making,
decisions that will foreseeably financially affect such interest.
If subject to the Act, Franchisee shall conform to all requirements of the Act. Failure to do so
constitutes a material breach and is grounds for immediate termination of this Agreement by
City. Franchisee shall indemnify and hold harmless City for any and all claims for damages
resulting from Franchisee's violation of this subsection.
[SIGNATURES ON FOLLOWING PAGE]
17
0
•
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on the day
and year first written above.
ATTEST:
rAvnKTXMkA UAVVTPcc
"CITY"
CITY OF NEWPORT BEACH, a Municipal
Corporation
0'x!1!, Sil
le
.�
AARON C. HARP
Assistant City Attorney
FU
Mayor
NAME: ` -Oh n KQ taw W JQ n
(Print)
TITLE: Tres- td6fw-
DATE: :a 1,;'o_
BY: ![J r 01t
NAME: �J `-
(Print)
TITLE: V ph (deot
DATE: a a
'Y •
FRANCHISE EXTENSION AGREEMENT
BETWEEN
THE CITY OF NEWPORT BEACH AND KEY DISPOSAL, INC.
This Franchise Extension Agreement is entered into between the City of Newport Beach ( "City ") and
Key Disposal, Inc: ( "Key') this 13`h day of December, 2005, with regards to the following facts:
RECITALS
WHEREAS, by approving Ordinance No. 97 -38 on or about November 24, 1997, the City granted Key a
non - exclusive franchise to provide solid waste collection services ( "Franchise ") and entered into a solid
waste franchise agreement ( "Franchise Agreement') with Key. The Franchise and Franchise
Agreement will expire on January 1, 2006; and
WHEREAS, City and Key desire to extend the Franchise and Franchise Agreement until March 1, 2007
to allow for additional time for negotiations to consider the renewal of the Franchise and Franchise
Agreement.
NOW THEREFORE, the Parties agree as follows:
The Franchise and Franchise Agreement shall be extended to March 1, 2007. During said
extension, the terms and conditions of the current Franchise and Franchise Agreement shall
remain in full force and effect without modification.
2. Nothing herein shall be deemed or construed as a waiver, release or surrender of any right that
either party may have under any applicable law. Nothing herein shall waive, release or
otherwise relieve Key from any Franchise and/or Franchise Agreement breaches or violations, if
any exist, or other violations of law, if any, and the grant of this Franchise and Franchise
Agreement extension shall not be utilized by Key for any purpose other than to extend, and
document the extension, of the Franchise and Franchise Agreement through March 1, 2007.
IN WITNESS WHEREOF, the parties hereto have caused this Franchise Extension Agreement to be
executed in duplicate on the date and year first written herein.
CITY OF NEWPORT BEACH,
=�Z.'Corporation
Homer Bludau, y Manager
APPROVED AS TO FORM:
C-
Aaron C. Harp,
Assistant City Attorney
By:
Name:
Title:
ATTEST: // jy� �j�,
By: yq 7�.2 r) •��
Lavonne Harkless,
City Clerk
[END SIGNATURES]
a
COMMERCIAL SOLID WASTE COLLECTION
FRANCHISE AGREEMENT BETWEEN THE CITY OF
NEWPORT BEACH AND KEY DISPOSAL, INC.
This Nonexclusive Franchise Agreement for Commercial Solid Waste
Handling Services ( "Agreement" herein), is entered into and executed by and
between the CITY OF NEWPORT BEACH, a municipal corporation, and
Charter City organized and existing under the laws of the State of California
( "City "), and Key Disposal, Inc. ("Franchisee ").
RECITALS
This Agreement is entered into on the basis of the following facts:
A. Franchisee has provided or is capable of providing commercial
solid waste collection services in the City pursuant to a permit issued in accordance
with the Newport Beach Municipal Code ( "Code ").
B. City has duly adopted Ordinance No. 95 -63 which has repealed
the former Chapter 12.63 and added a new Chapter 12.63 of the Code and requires
a franchise for all persons providing commercial solid waste handling services for
solid waste generated in the City,
C. Article XIII of the City Charter, Chapter 12.63, and Sections
49300 and 49500 -49523 of the Public Resources Code authorize the City to enter
into nonexclusive franchise agreements for commercial solid waste handling
services.
D. City contends that Franchisee has received written notice from
the City, pursuant to Public Resources Code Sections 49520 and 49521, that
commercial solid waste handling services may be authorized under exclusive or
nonexclusive franchise, and that Franchisee was entitled to continue to operate
within the City only until its rights under a commercial solid waste collection permit
were terminated or revoked. All such rights are terminated by this Agreement.
E. Pursuant to this Agreement, City desires to authorize
Franchisee to provide nonexclusive commercial solid waste handling services within
the City. Franchisee shall furnish all personnel, equipment, and supplies necessary
to collect, transport, or otherwise remove and dispose of residential solid waste and
recyclable materials, as defined herein, from commercial, institutional, or industrial
premises within the City.
F. The City Council has determined that the grant of a
nonexclusive franchise is in the public interest.
11
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NOW, THEREFORE, CITY AND FRANCHISEE DO HEREBY AGREE AS
FOLLOWS:
SECTION 1. GRANT OF FRANCHISE
A. By Ordinance No. 97- , City has granted to Franchisee a nonexclusive
Franchise authorizing Franchisee to provide commercial solid waste handling
services for solid waste kept, accumulated, or generated in the City of Newport
Beach and to use the public streets and rights of way for such purpose. Franchisee
acknowledges that the Franchise is not exclusive and that the Franchise is subject
to the provisions of Article XIII of the City Charter, Ordinance No. 97- , Chapter
12.63 of the Code, and the terms and conditions of this Agreement.
B. Upon the effective date of this Agreement, the parties agree that any
prior authorization relating to the conduct of commercial solid waste handling
services in the City arising under and pursuant to any prior permit issued to
Franchisee shall be deemed to be terminated and of no further force or effect.
SECTION 2. TERM OF FRANCHISE
Subject to Section 17 of this Agreement, the term of this Agreement shall be
from January 1, 1998 to December 31, 2005, inclusive.
SECTION 3. DEFINITIONS
Unless otherwise defined, or if the use or context clearly requires a different
definition, all words, terms and phrases in this Agreement and the derivations
thereof shall have the meanings set forth in Section 12.63.020 of the Code.
SECTION 4. FRANCHISE FEES
A. During the term of the Franchise, Franchisee shall pay to City
franchise fees for the privilege of providing commercial solid waste handling services
in the City of Newport Beach and the use of public streets, right of ways and places
for such purposes. Fees shall be in the following amounts:
(1) Franchisee shall pay to the City 7.5% (seven and one half
percent) of the gross receipts for all commercial solid waste handling services
provided by the Franchisee in the City for the first year of the franchise. The
franchise fee shall increase by 1% (one percent) per year for each of the next
succeeding three years of this Agreement. Thereafter, the franchise fee will be
capped at 10.5% for the life of the Agreement.
(2) Franchise fee payments shall be 'paid quarterly and shall be
computed and paid on the basis of paid receipts received by the Franchisee for all
solid waste handling services within the City.
2
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(3) (One half of one percent) .5% of the franchise fee shall be
attributable to the maintenance and implementation of the City's Source
Reduction and Recycling Element "SRRE," and shall be separately accounted for,
and used only for the costs stated in Public Revenue Code Section 41901 or any
successor provision.
B. Franchisee shall pay all required franchise fees to:
Administrative Services Director
City of Newport Beach
3300 Newport Boulevard
Newport Beach, CA 92659
C. Franchise fees shall be due and payable on the thirtieth (30th) day of
the month following the end of each quarter. If franchise fees are not paid by
Franchisee when due, then in addition to the franchise fees, Franchisee shall pay a
late payment penalty in an amount equal to ten percent (10 %) of the franchise fee
that was not timely paid by Franchisee. If Franchisee fails to pay delinquent
franchise fees within thirty (30) days of the date due, Franchisee shall pay a second
late payment penalty in an amount equal ten percent (10 %) of the franchise fee
outstanding after such thirty day period. The second late payment penalty shall be
in addition to the first late payment penalty. In addition, Franchisee shall pay
interest on all unpaid franchise fees at the rate of ten percent (10 %) per annum or
the legal rate allowed, whichever is less, from the date the franchise fees were due
and payable to the date actually paid. Franchisee will be responsible for all billing
and collection from all its customer accounts.
D. If Franchisee remits franchise fees by personal delivery to City, such
franchise fees shall be deemed timely paid only if delivered on or before the due date
set forth in Section 12.63.070 of the Code. If Franchisee remits franchise fees by
mail or other delivery service, such franchise fees shall be deemed timely only if (1)
the envelope containing the franchise fee payment bears a postmark or receipt
showing that the payment was mailed or sent on or before the due date or (2)
Franchisee submits proof satisfactory to the Administrative Services Director that
the franchise fee payment was in fact deposited in the mail or sent on or before the
due date.
E. For any quarter in which Franchisee determines that any outstanding
delinquent payment for commercial solid waste handling services is uncollectible,
Franchisee shall attach to the report a list of the customers for which Franchisee
has written off the delinquent payment determined to be uncollectible.
F. In the event Franchisee believes that it has paid franchise fees in
excess of the fees due to City, Franchisee may submit a request for refund to the
Administrative Services Director on a form provided by the Director. If proof of
overpayment is satisfactory to the Director, the Director shall refund to Franchisee
any overpayment. Franchisee shall not apply any overpayment as a credit against
any other amounts payable to City unless specifically so authorized by the
Administrative Services Director in writing.
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G. Each franchise fee payment shall be accompanied by a written
statement described in Section 12.63.070 of the Code on a form provided by the
Administrative Services Director.
H. No maximum nor minimum service fee will be set by the City. The
fees will fluctuate with market demand.
SECTION 5. DISPOSAL OF COMMERCIAL SOLID WASTE
A. Franchisee shall dispose of solid waste collected or
transported by Franchisee only by taking such solid waste to a landfill, transfer
station, recycling facility or materials recovery facility which is lawfully authorized
to accept such solid waste. Franchisee shall not dispose of solid waste by depositing
it on any land, (except a permitted recycling facility) whether public or private, or in
any river, stream or other waterway, or in any sanitary sewer or storm drainage
system. Nothing in this Agreement shall be deemed or construed as authorizing
Franchisee to operate a landfill, recycling center, or other solid waste disposal
facility.
B. All solid waste, in addition to recyclables, collected by Franchisee shall
become the property of Franchisee upon placement by the customer for collection.
Franchisee agrees that the City has the future right, at any time, to direct that
solid waste be delivered to a permitted disposal facility designated by City. For
example, the City may exercise this right in order to save solid waste generators
money on disposal costs, to avoid disposal sites with potential cleanup problems, or
to meet the requirements for access to a disposal site. Franchisee agrees to deliver
the :solid waste which it collects to any disposal facility directed by the City. This
exercise of "flow control' by the City shall be made upon at least one hundred
twenty (120) days prior written notice to Franchisee. Franchisee represents and
agrees that since November 6, 1995, Franchisee has not entered and will not enter
into any agreements with a disposal facility for disposal of any solid waste which it
collects in the City for more than one hundred twenty (120) days without the
written consent of the City. City shall not withhold its consent to any written
agreement which provides that the agreement may be terminated by Franchisee at
any time, without cause, upon 120 days notice.
C. Franchisee shall include as a condition to its contractual agreement
with its customers a provision prohibiting disposal of hazardous solid waste in any
of Franchisees vehicles or disposal bins/containers, and other equipment.
D. Franchisee shall implement a load check program that includes at a
minimum a visual check of all containers to be emptied to protect against inclusion
of hazardous waste and shall prepare a written record of all hazardous waste
discovered during the process. The records shall comply with all State and Federal
Hazardous Waste Regulations, shall be maintained for the length of the term of the
Franchise, and shall be made available to the City upon request.
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SECTION 6. REPORTS
A. Franchisee shall submit to City quarterly reports stating the total
amount of solid waste which Franchisee collected in the City during the reportable
quarter; the total weight (in tons) of solid waste disposed of by Franchisee at
landfills and transfer stations during the reportable quarter; and the total weight
and the weight by material category (in tons) of solid waste disposed of by
Franchisee at recycling and materials recovery facilities during the reportable
quarter. Such quarterly reports shall be prepared on the form attached to this
Agreement as EXHIBIT A or on such other form as required by the General
Services Director. Each quarterly report shall be submitted on or before the 15th,
day of the month following the end of the quarter (i.e. report due April 15 for first
quarter of the year) and submitted to:
General Services Director
City of Newport Beach
3300 Newport Boulevard
Newport Beach, CA 92659
B. If the report required under subsection A is not filed by the due date
specified above, the report shall be deemed delinquent If the report remains
delinquent for more than fifteen (15) days, Franchisee shall pay to City a delinquent
report charge in the amount of One Hundred Dollars ($100). If the report remains
delinquent for more than forty -five (45) days, Franchisee shall pay to City a
delinquent report charge in the amount of Five Hundred Dollars ($500). Such
delinquent report charges shall be in addition to any franchise fees or other charges
payable by Franchisee under this Agreement.
SECTION 7. Commercial Solid Waste Collection Services
A. Frequency of Collection. Franchisee shall collect all solid waste,
including recyclable materials, as authorized in this Agreement, on a schedule to be
agreed upon between the Franchisee and its customers. The schedule shall provide
for collection service at least once per week; provided, however, that such schedule
shall not permit the accumulation of solid waste in quantities that are
unreasonable or detrimental to the public health or safety. Requests for collection
from premises with overflowing bins or containers, or from premises where there
have been missed pickups, shall be serviced with 24 hours of any such request. If
requested by the City at any time; Franchisee's collection schedule shall be
submitted to the City for its approval.
B. Hours and Days of Collections. No collection of solid waste from
commercial premises within 500 feet of occupied residential premises, motels or
hotels shall be made by Franchisee between the hours of 9:00 p.m., and 7:00 a.m.
on the next day, nor shall any of Franchisee's collection vehicles be operated in any
residential areas of the City between the hours of 9:00 p.m. and 7:00 a.m. on the
next day.
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SECTION 8. ENVIRONMENTAL LIABILITY FUND
A. City and Franchisee acknowledge the potential liability which can result
from solid waste handling services under Federal and State environmental laws.
City intends to take reasonable actions to obtain protection and indemnification
against future environmental liability for solid waste generated within the City and
the activities of Franchisee under this Agreement for handling such solid waste. To
provide protection and indemnification to City for Franchisee's solid waste handling
activities in the City, Franchisee agrees to collect from its customers a fee for
payment into an Environmental Liability Fund which shall be a separate Fund
established and maintained by City. The Fund shall be used to either purchase
insurance which will ensure the City against environmental liability which may be
imposed upon City as a result of Franchisee's activities under this franchise and/or
shall to be used to defend and indemnify the City if insurance is not available or
cannot be provided at a cost acceptable to City. The Fund shall not be commingled
with or included in the City's General Fund.
B. Franchisee shall pay to the City Environmental Liability Fund 5.5% of
gross receipts for all commercial solid waste handling services provided by the
Franchisee in the City during the prior reporting period. Payment shall be made
concurrently with the payment of the Franchise fees and the filing of reports
specified in Section 4 and 6 of this Agreement.
C. Payments under paragraph B above may be adjusted by City, on an
annual basis, upon one hundred twenty (120) days prior ° notice to Franchisee, as
appropriate, to ensure that total payments by all Franchisees into the Fund is
maintained at approximately two hundred twenty five thousand dollars
($225,000.00) a year. The fee may be decreased or waived as deemed appropriate
by City if subsequent changes in Federal and State law diminish or eliminate
liability of City under Federal and State environmental laws.
D. Compliance with this obligation shall not limit Franchisee's
indemnification as set forth in Section 11, however, the indemnification provisions
of 11B shall be secondary to the Fund established by this Section or any insurance
purchased with the funds provided.
SECTION 9. FRANCHISEE'S RECORDS
A. Franchisee shall keep and maintain books of account, income
statements and supporting documents of all business transactions conducted by
Franchisee in connection with the commercial solid waste handling services of
Franchisee under this Agreement. Such records shall be kept at Franchisee's place
of business.
B. The books of account, income statements and supporting documents
shall be made available to City at Franchisee's place of business during normal
business hours upon request or demand of the City Manager, City Administrative
Services Director, City Attorney, or other City officer, employee or consultant
authorized by any of these officers. The purpose of such inspection and/or audit
shall be for verification of the fees paid by Franchisee under this Agreement, and
the accuracy thereof; and for verification of the amounts of solid waste reported by
Franchisee pursuant to this Agreement. To the extent authorized by law,
Franchisee's books of account, income statements and other documents accessed
by City shall be kept confidential.
C. Franchisee shall reimburse City for City's costs in performance of an
audit if, as a result of the audit it is determined:
i there was any intentional misrepresentation by Franchise with
respect to the amount of franchise fees due to the City; or
ii. there is a one thousand dollars ($1,000.00) or greater
discrepancy in the amount of franchise fees due to the City.
Such reimbursement shall be paid by Franchisee WITHIN THIRTY
(30) days of the date City notifies Franchisee in writing of the amount of City's
costs.
SECTION 10. INSURANCE REQUIREMENTS
Without limiting the indemnification provided in Section 11, Franchisee shall
obtain and shall maintain throughout the term of this Agreement, at Franchisee's
sole cost and expense, insurance against claims for injuries to persons or damages
to property which may arise from or in connection with the commercial solid waste
handling services provided under this Agreement by Franchisee, its agents,
representatives, employees or contractors.
A. Minimum Scope and Limits of Insurance.
Franchisee shall maintain at least the following minimum insurance
coverages:
1. Commercial General Liability: $1,000,000 combined single limit per
occurrence for bodily injury, personal injury and property damage. The Commercial
General Liability insurance limit shall apply separately to this Agreement or the
general aggregate limit shall be twice the required occurrence limit.
2. Automobile Liability: $2,000,000 combined single limit per occurrence
for bodily injury and property damage, and shall include sudden and accidental
coverage.
3. Workers' Compensation and Employers Liability: Workers'
Compensation statutory limits as required by the California Labor Code and
Employers Liability limits of $1,000,000 per accident.
B. Deductibles and Self- Insured Retentions.
Any deductibles or self - insured retentions must be declared to and approved
by City's Risk Manager. At the option of City either: the insurer shall reduce or
eliminate such deductibles or self-insured retentions as respects City, its officers,
employees, agents and contractors; or Franchisee shall procure a bond
guaranteeing payment of losses and related investigations, claim administration
and defense expenses in an amount specified by City's Risk Manager.
C. Endorsements.
The required insurance policies are to contain, or be endorsed to contain, he
following provisions:
1. General Liability and Automobile Liability Coverages
a. The City of Newport Beach, its officers, employees, agents and
contractors are to be covered as an additional insured as respects: liability arising
out of activities performed by, or on behalf of Franchisee; products and completed
operations of Franchisee; premises owned, leased or used by Franchisee; and
automobiles owned, leased, hired or borrowed by Franchisee. The coverage shall
contain no special limitations on the scope of protection afforded to City, its officers,
employees and agents and contractors.
b. Franchisee's insurance coverage shall be primary insurance as
respects City, its officers, employees, agents and contractors. Any insurance or
self - insurance maintained by City, its officers, employees, agents or contractors
shall be excess of Franchisee's insurance and shall not contribute with it.
C. Any failure to comply with reporting provisions of the policies
shall not affect coverage provided to City, its officers, employees, agents or
contracts.
d. Coverage shall state that Franchisee's insurance shall apply
separately to each insured against whom claim is made or suit is brought, except
with respect to the limits of the insurer's liability.
2. All Coverages
Each insurance policy required by this Agreement shall be endorsed to
state that coverage shall not be suspended, voided, canceled, or reduced in limits
except after thirty (30) days' prior written notice has been given to the City.
D. Placement of Insurance.
Insurance shall be placed with an insurance company certified to do business
in the State of California, with Best's rating A -VII or better, unless otherwise
approved by the City Risk Manager.
E. Proof of Insurance.
Franchisee shall furnish City with certificates of insurance and with original
endorsements affecting coverage required by this Agreement. The certificates and
endorsements for each insurance policy are to be signed by a person authorized by
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that insurer to bind coverage on its behalf. Proof of insurance shall be mailed or
personally delivered to the following address or to such other address as may be
directed in writing by the City's Risk Manager:
City of Newport Beach
Risk Manager
3300 Newport Boulevard
Newport Beach, CA 92659
F. Subcontractors
Franchisee shall include all subcontractors as insureds under Franchisee's
policies or shall obtain separate certificates and endorsements for each
subcontractor.
G. Failure to Provide Insurance.
Franchisee agrees that if any policy of insurance required by this Agreement
is not maintained in full force and effect, the City Manager may, in his sole
discretion, suspend this Agreement, - immediately, until such time as the required
insurance is in effect and the required certificates and endorsements are delivered
to the City.
SECTION 11. INDEMNIFICATION
Franchisee, as a condition of the Franchise shall indemnify the City as
follows:
A. General Liability: Franchisee shall indemnify, defend and hold
harmless the City, its officers, employees and agents, with respect to any loss,
liability, injury or damage that arises out of, or is in any way related to, the acts or
omissions of Franchisee, its employees, officers and agents in the performance of
any activity, function or duty authorized by, or required under the terms of, the
Franchise, except Franchisee shall not be required to indemnify City in connection
with the negligence or willful acts or omissions of the City, its officers, agents or
employees.
B. Hazardous Substances Indemnification: Franchisee shall indemnify
City, defend with counsel approved by City, protect and hold harmless City, its
officers, employees, agents, assigns, and any successor or successors to City's
interest from and against all claims, actual damages including, but not limited to,
special and consequential damages, natural resource damage, punitive damages,
injuries, costs, response, remediation, and removal costs, losses, demands, debts,
liens, liabilities, causes of action, suits, legal or administrative proceedings, interest,
fines, charges, penalties and expenses attorneys' and expert witness fees and costs
incurred in connection with defending against any of the foregoing or in enforcing
this indemnity of any kind whatsoever paid, incurred or suffered by, or asserted
against, City or its officers, employees, agents or Franchisee arising from or
attributable to Franchisee's activities under this Agreement concerning any
•
hazardous substances or hazardous waste at any place where Franchisee stores or
disposes of solid or hazardous waste pursuant to this franchise agreement, or
preceding agreements between City and Franchisee. The foregoing indemnity is
intended to operate as an agreement pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act 42. U.S.C. Section
9607(e) and any amendments thereto; California Health and Safety Code Section
25364, to insure, protect, hold harmless, and indemnify City from liability.
C. AB939 Indemnification: Franchisee agrees to meet all requirements
of City's Source Reduction and Recycling Element as to the portion of the solid
waste stream handled by Franchisee. Franchisee agrees to protect, defbnd,
indemnify, and hold City harmless against all fines or penalties imposed by the
California Integrated Waste Management Board with respect to the portion of the
commercial waste stream collected by Franchisee.
D. City agrees to give notice to Franchisee when the City receives a
claim for damages or other liability for which Franchisee has provided
indemnification under this Section.
SECTION 12. VEHICLES AND EQUIPMENT
A. Any and all containers provided to customers of Franchisee for
storage, collection or transportation of commercial solid wastes shall meet the
requirements of Section 12.63.110 of Chapter ° 12.63 of the Code as well as State of
California minimum standards for solid waste handling established under Public
Resources Code Section 43020 and applicable health requirements.
B. All containers and all vehicles used by Franchisee in the performance
of commercial solid waste handling services shall be marked with Franchisee's
name and telephone number in letters which are not less than four inches (4 ") high
or which are easily read by the general public.
C. Equipment.
(1) Franchisee shall, at all times, provide such number of vehicles
and such equipment as will be adequate for the collection, transportation and
disposal services which it is authorized to provide under this Agreement. All
vehicles utilized by Franchisee in the performance of this Agreement shall be
registered with the California Department of Motor Vehicles. All vehicles shall be
properly maintained, kept clean and in good repair, and shall be uniformly painted.
All commercial solid waste containers used in the performance of this Agreement
shall be kept clean and in good repair and shall be uniformly painted to the
satisfaction of the General Services Director. All vehicles and equipment used by
Franchisee -in the performance of this Agreement may be subject to -inspection by
the City on a semi - annual basis.
(2) Each vehicle shall be so constructed and used that no rubbish,
garbage, debris, oil, grease or other material will blow, fall, or leak out of the vehicle.
All solid waste shall be transported by means of vehicles which are covered in such
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a manner as to securely contain all solid waste and to prevent such solid waste
from projecting, blowing, falling or leaking out of the vehicles. Any solid waste
dropped or spilled in collection, transfer or transportation shall be immediately
cleaned up by Franchisee. A broom and a shovel shall be carried at all times on
each vehicle for this purpose. In addition, each collection vehicle shall be equipped
with trash bags, masking tape and notice of non- collection tags for the purpose of
separating hazardous waste for return to the generator. A communications device
such as a two -way radio or a cellular telephone shall also be maintained on each
vehicle.
(3) Franchisee shall not store any vehicle or equipment on 'any
public street or other public property in the City without the prior written consent
of the General Services Director.
(4) Should the General Services Director at any time given written
notification to Franchisee that any vehicle does not comply with the standards
hereunder, the vehicle shall be promptly removed from service by Franchisee and
not again be so used until inspected and authorized in writing by the General
Services Director.
SECTION 13. ABANDONED CONTAINERS
A. Franchisee shall comply with the regulations adopted by the City
Manager for placement of commercial solid waste containers on public property.
B. If Franchisee abandons any commercial solid waste container within
the City, the City may remove the container and/or dispose of the contents of the
container.
C. If City is required to remove a roll-off or compactor container
abandoned by Franchisee and/or disposes of the contents of any container
abandoned by Franchisee, City may charge Franchisee for City's costs incurred in
such removal/disposal and for City's costs of storage of the container. Franchisees
who are engaged in providing roll-off containers shall maintain a $3,000
performance bond, certificate of deposit or other form of security acceptable to the
City, with City Revenue Division to reimburse City for such costs within ten (10)
days of the date of City's invoice for such costs.
D. For the purposes of this Section, "abandoned" includes:
(1) Franchisee's failure to remove the container within the time
period specified by the City Council upon termination of the Franchise pursuant to
Section 12.63.130 of the Code;
(2) Franchisee's failure to remove the container within ten (10)
working days after the expiration of the Franchise granted to Franchisee, except in
the case where Franchisee has been granted an extension of the term of said
Franchise or Franchisee has been granted a subsequent Franchise authorizing
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Franchisee to collect and transport the type or types of solid waste for which the
container was used pursuant to this Agreement.
(3) Franchisee's failure to collect the container and dispose of the
contents of the container within five (5) days after City's Director of General
Services issues written notice to Franchisee to dispose of the contents.
SECTION 14. COMPLIANCE WITH LAW
A. Franchisee shall perform all solid waste handling services in
accordance with applicable federal, state, and local law, including Chapter 12.63 of
the Code, Article XIII of the City Charter, Ordinance No. 95 -63 and in accordance
with the terms and conditions of this Agreement.
B. Over the course of the franchise term, Franchisee and City agree that
the City's ordinances may be amended as necessary to permit the City to comply
with changes to federal, state, and local legislative regulatory requirements, which
may affect or alter City's solid waste handling obligations or requirements for solid
waste management. Franchisee agrees to comply with any such amendment of the
City's ordinances.
SECTION 15. PERMITS AND LICENSES
Franchisee shall obtain and maintain, at Franchisee's sole cost and expense,
all permits and licenses applicable to Franchisee's operations under the Franchise
which are required of Franchisee by any governmental agency.
SECTION 16. PUBLIC EDUCATION ACTIVITIES
A. City and Franchisee shall cooperate in co- sponsoring not more than
one promotional event per year, as mutually agreed upon in advance by the parties,
which is related to the implementation of commercial solid waste handling services
and recycling services.
B. Each year during the term of.this Agreement, on an annual basis,
Franchise shall transmit promotional brochures or fliers to its commercial
customers, and to such prospective commercial customers as it may select,
informing them of the commercial solid waste handling services and recycling
services which are provided by the Franchisee as well as hazardous waste disposal
requirements.
C. All promotional brochures, fliers or other information distributed by
Franchisee hereunder shall be printed on recycled paper. All such informational
materials shall be approved in advance by the City's General Services Director.
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SECTION 17. TERMINATION AND SUSPENSION
A. The franchise granted to Franchisee may be terminated by the City
Council pursuant to Section 12.63.130 of the Code.
B. In the event the Franchise is terminated pursuant to Subsection A
above or the term of this Agreement expires:
(1) Franchisee shall have no right or authority to engage in commercial
solid waste handling operations in the City of Newport Beach, subject to the
provisions of Sections 49520 -49523 of the Public .Resources Code.
(2) Franchisee shall, however, remain liable to City for any and all
franchise fees that would otherwise be payable by Franchisee, for any and all late
payment charges and interest assessed pursuant to Section 4 of this Agreement,
and for any and all delinquent report charges assessed pursuant to Section 6 of this
Agreement.
(3) Franchisee shall have a continuing obligation to submit to City all
reports required by Section 6 of this Agreement which relates to commercial solid
waste handling activities performed by Franchisee up to and including the date of
termination, suspension, or expiration.
(4) Franchisee shall allow the solid waste generators served by
Franchisee to arrange for solid waste handling services with a solid waste
enterprise collector authorized to perform such services, without penalty or liability
for breach of contract on the part of the generators, for such period of time as
Franchisee is not authorized to perform such services because of termination or
suspension.
(5) Franchisee agrees to continue to provide the indemnifications required
in this contract after its suspension or termination. Such indemnifications include,
but are not limited to, the hazardous materials indemnification and AB939
indemnification in Section 11.
C. In the event this Franchise is terminated pursuant to Subsection A
above, then within the time period specified by the City Council, Franchisee shall
remove all of Franchisee's commercial solid waste containers, and all of such
containers used by Franchisee's subcontractors in performance of solid waste
handling services pursuant to the Franchise, from all Franchisee's collection service
locations and shall properly dispose of all solid waste in such containers.
D. In the event the Franchise is terminated pursuant to Subsection A
above or expires without an extension of the term and without a grant of a
Subsequent Franchise allowing Franchisee to continue performing such services,
then within ten (10) days of such termination or expiration Franchisee shall either:
(1) Submit to City's General Services Director a list of the names and
addresses of solid waste generators in Newport Beach for which Franchisee
13
provided services as of the date of termination or expiration (i.e. Franchisee's
Newport Beach customer list); or
(2) Send written notification to each solid waste generator on Franchisee's
customer list that Franchisee is no longer authorized to provide commercial solid
waste handling services in Newport Beach. Such notification shall be in the form
provided by City's General Services Director and shall be personally delivered or
shall be sent by first class mail, postage prepaid, to the customers' billing
addresses. Franchisee shall submit to City's General Services Director an affidavit,
signed under penalty of perjury, stating that the required notification has been
provided by Franchisee to all of Franchisee's Newport Beach customers.
SECTION 18. ASSIGNMENT
Franchisee shall not assign, sell, subcontract, transfer or otherwise delegate
its authority to perform any portion of the solid waste handling services or
obligations under the Franchise without prior express written consent of the City
Council. This prohibition includes any transfer of ownership or control of
Franchisee, or the conveyance of a majority of Franchisee's stock to a new
controlling interest. City's consent shall not be unreasonably withheld.
SECTION 19. MISCELLANEOUS PROVISIONS
A. Notices. Except as otherwise provided in this Agreement, all notices
required by this Agreement shall be given by personal service or by deposit in the
United States mail, postage pre -paid and return receipt requested, addressed
to the parties as follows:
To: General Services Director
City of Newport Beach
3300 Newport Boulevard
Newport Beach, CA 92659
To Franchisee: Key Disposal, Inc.
1441 South Taylor Avenue
Montebello, CA 90640
Notice shall be deemed effective on the date personally served or, if mailed,
three days after the date deposited in the mails.
B. Amendments. This Agreement supersedes all prior agreements and
understandings between the parties and may not be modified or terminated orally,
and no modification, termination or attempted waiver of any of the provisions
hereof shall be binding unless in writing and signed by the party against whom the
same -is sought to be enforced.
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C. Applicable Law. This Agreement and the transactions herein
contemplated shall be construed in accordance with an governed by the applicable
laws of the State of California and of the United States.
D. Authority. The parties signing below represent and warrant that they
have the requisite authority to bind the entities on whose behalf they are signing.
E. Conflicts: In the event of any conflict between the provisions of this
Agreement and the provisions of Chapter 12.63 of the Code, the provisions of this
Agreement shall control.
F. Severability. If any provision of this Agreement is determined by a
court of competent jurisdiction to be invalid or unenforceable, the remaining
provisions shall not be affected unless their enforcement under the circumstances
would be unreasonable, inequitable or would otherwise frustrate the purposes of
this Agreement.
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WITNESS THE EXECUTION OF THIS AGREEMENT ON THE DATE
WRITTEN BELOW EACH SIGNATURE:
"CITY"
CITY OF NEWPORT BEACH, a Municipal
Corporation
ATTEST
APPROVED AS TO FORM:
n'
ROBIN CLAUSON�
Assistant City Attorney
�' iMYor
DATE: / /-- 10-( /%
John Katangian
Title: President
Date:
16
ACCEPTANCE OF SOLID WASTE MANAGEMENT FRANCHISE
WHEREAS, on November 27 1995, the City Council of the City of
Newport Beach adopted Ordinance No. 95 -64 entitled an Ordinance of the City
Council of the City of Newport Beach Granting Nonexclusive Franchises to
Provide Solid Waste Collection Services Upon the City Streets and within the
City of Newport Beach; and
WHEREAS, the Charter of the City of Newport Beach, Section 1303,
and Ordinance No. 95 -64 provide that any franchise granted shall not become
effective until written acceptance is filed by the Grantee with the City Clerk.
The acceptance shall be filed within ten (1-0? days after the adoption_ of
Ordinance No. 95 -64.
WHEREAS, the undersigned Grantee wishes to accept the grant of the
Franchise.
NOW THEREFORE, KEY DISPOSAL, INC. hereby
accepts the grant of the Nonexclusive Franchise granted by Ordinance No. 95-
64 and hereby agrees to comply with the provisions of the Newport Beach
Charter, Chapter 12.63, Ordinance No, 95 -64 and the Franchise Agreement in
all its operations pursuant to the grant of the Franchise.
DATE:
FRAN ISEE
BY: �r217
TITLE
CITY CLERK'S VERIFICATION OF ACCEPTANCE
I, LaVonne M. Harkless, City Clerk, certify that the above acceptance of
Franchise was received by me on'Dcc -- 1 , 1997, at a.m p,mJ
CITY CLERK
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ORDINANCE. NO. 97 -
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH GRANTING A NONEXCLUSIVE
FRANCHISE TO PROVIDE SOLID WASTE
COLLECTION SERVICES UPON THE CITY STREETS
AND WITHIN THE CITY OF NEWPORT BEACH
The City Council of the City of Newport Beach does ordain as follows:
SECTION 1 Findings
A. Article XIII of the City Charter and Sections 49500 through 49523 of the Public
Resources Code authorize the City to enter into nonexclusive franchise
agreements for commercial solid waste handling services with private solid
waste enterprises.
B. The City Charter and Chapter 12.63 establish requirements and procedures to
grant a franchise to provide solid waste handling services within the City of
Newport Beach.
C. In compliance with the City Charter a duly noticed public hearing was held on
November 24, 1997, to consider the granting of a franchise to each of the solid
waste enterprises listed on Exhibit "A" to this Ordinance which is incorporated
into this Ordinance by reference as though set forth in full herein.
D. Having considered all oral and documentary evidence presented at the public
hearing, the City Council has determined that the granting of nonexclusive
franchises is in the public interest.
SECTION 2: Definitions
All words, terms, phrases in this Ordinance shall have the meanings set forth in Section
12.63.020 of Chapter 12.63 of the Newport Beach Municipal Code.
SECTION 3: Franchise Agreement
A. Grant of Franchise
There is hereby granted to each of the solid waste enterprises listed on Exhibit
"A", a nonexclusive franchise to operate, maintain and provide, along, across
and over the public streets, alleys, public ways and public places dedicated for
public use in the City, a franchise for solid waste handling services.
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B. Nonexclusive Grant
The right to use City streets, alleys, public ways and places for the purposes set
forth in this Ordinance, shall not be exclusive and the City reserves the right to
grant a similar use of streets, alleys, public ways and places to any person at
any time during the term of this franchise.
C. Term of Franchise
The term of the franchise shall be eight years (8) years and shall commence at
12:01 a.m., on January 1, 1998, provided that the grantee has filed written
notice of acceptance in accordance with the requirement of Section 4 of the
Ordinance.
D. Franchise Fees
A. During the term of the Franchise, franchisee shall pay to City franchise
fees for the privilege of providing commercial solid waste handling services
in the City of Newport Beach and the use of public streets, right of ways
and places for such purposes. Fees shall be in the following amounts:
(1) Franchisee shall pay to the City 7.5% (seven and one -half percent)
of the gross receipts for all commercial solid waste handling services
provided by the franchisee in the City until January 1, 1999. The
franchise fee shall increase by 1% (one percent) per year for each of the
next succeeding three years of the Agreement. Thereafter, the
franchise fee will be capped at 10.5% for the life of the Agreement.
(2) Franchise fee payments shall be paid quarterly and shall be
computed and paid on the basis of paid receipts received by the
franchisee for all solid waste handling services within the City.
(3) (One - half of one percent) .5% of the franchise fee shall be
attributable to the maintenance and implementation of the City's
Source Reduction and Recycling Element (SRRE), and shall be
separately accounted for, and used only for the costs stated in Public
Revenue Code Section 41901 or any successor provisions.
B. Franchisee shall pay to the City Environmental Liability Fund 5.5% of
gross receipts for all commercial solid waste handling services provided by
'the Franchisee in the City during the prior reporting period. Payment shall
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be made concurrently with the payment of the Franchise fees and the filing
of reports specified in Section 4 and 6 of this Agreement.
E. Inclusion of Franchise Documents
Each franchisee shall comply with and shall be bound by all of the terms,
provisions and conditions contained in the City Charter, this Ordinance,
Chapter 12.63 of the Newport Beach Municipal Code and the Franchise
Agreement attached to this Ordinance as Exhibit "B" which is hereby adopted,
approved and incorporated into this Ordinance by reference.
SECTION 4: Effective Date
This Ordinance shall become effective 30 days from and after the date of its adoption;
provided, however, each franchisee granted by the Ordinance shall not become effective
unless and until the grantee files written acceptance of the franchise with the City clerk,
and delivers to the City all bonds and insurance policies required to be furnished in
accordance with the requirements of Chapter 12.63 of the Newport Beach Municipal
Code and the Franchise Agreement. The written acceptance shall be in form and
substance as prescribed by the City Attorney and shall operate as an acceptance of
each and every term, condition and limitation contained in the Ordinance, the Franchise
Agreement, Article XIII of the City Charter, and Chapter 12.63 of the Newport Beach
Municipal Code. Written acceptance of the franchise shall be filed by the grantee not
later than ten (10) days after the adoption of this Ordinance.
SECTION 5
The City Council of the City of Newport Beach finds that this Ordinance is categorically
exempt under the California Code of Regulations 15301 defined as "existing operations
and facilities" and Section 15308 defined as "actions by regulatory agencies for
protection of the environment." Use of this classification is appropriate because this
Ordinance does not change or expand existing solid waste operations and facilities within
the City and because the Ordinance furthers and strengthens the City diversion
requirements under State law and the City's Source Reduction and Recycling Element
(SRRE). The City Manager is authorized to execute and the City Clerk to file a Notice
of Exemption with the Orange County Clerk.
This Ordinance shall be published once in the official newspaper of the City.
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SECTION 6:
That if any section, subsection, sentence clause or phrase of the Ordinance is, for any
reason, held to be invalid or unconstitutional, such decision shall not affect the validity
or constitutionality of the remaining portions of this Ordinance. The City Council
hereby declares that it would have passed this Ordinance, and each section, subsection,
clause or phrase thereof, irrespective of the fact that any one or more sections,
subsections, sentence clauses and phrases be declared unconstitutional.
SECTION 7:
This Ordinance was introduced at a regular meeting of the City Council of the City of
Newport Beach, held on the 10th day of November, 1997, and adopted on the 24th day
of November, 1997, by the following vote to wit:
AYES, COUNCIL MEMBERS
NOES, COUNCIL MEMBERS
ABSTAINED, COUNCIL MEMBERS
ABSENT COUNCIL MEMBERS
MAYOR
ATTEST:
CITY CLERK
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ORDINANCE NO. 97 -
EXHIBIT "A'
John Katangian, President
Key Disposal, Inc.
1141 South Taylor Avenue
Montebello, CA 90640