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HomeMy WebLinkAbout01 - Minutes - AmendedDecember 8, 2020 CITY OF NEWPORT BEACH Agenda Item No. 1 City Council Minutes Study Session and Regular Meeting November 24, 2020 I. ROLL CALL - 4:00 p.m. Present: Mayor Will O'Neill, Mayor Pro Tem Brad Avery, Council Member Joy Brenner, Council Member Diane Dixon, Council Member Duffy Duffield, Council Member Kevin Muldoon Absent: Council Member Jeff Herdman II. SSI. Clarification of Items on the Consent Calendar - None SS2. Update on City's Residential Refuse and Recycling Collection Program Public Works Director Webb introduced William O'Toole 04onomics and Dean Ruffridge of CR&R. Deputy Public Works Director Martin used a presentation to discuss solid waste management in the City, changing laws regarding solid waste collection, recycling and disposal, the City's recycling status, Citywide residential refucollection, and the current two -cart collection system. f In response to Council questions, Deputy Pubad Works Dirctor Martin indicated the Material Recovery Facilities (MRF) are operational, stated that the residential dry cycle diversion rate is slightly less than 50% and needs to be more than 50%, and noted that, in order to comply with State mandates, the City needs to mohe contract to reach the needed level of program dif deployment. Deputy Public Works Director Mart tinned the presentation with program additions needed to accommodate changes in State law, proposed collection and processing modifications, a proposed three -cart option, and the ability to meet the diversion rate. In response to Council questions, Deputy Public Works Director Martin advised that the current hauler is moving away from W Llkreetwo-cart system, and the State mandate favors a three - cart system, noted that somJ households do not have blue carts because State mandates were not as strict when they were originally issued, stated that with legislative changes, blue carts are now mandatory, and added that full program implementation will require green carts for every household. Mayor O'Neill noted that Council has tried to not require three carts, and the main concern is implementation throughout the City. In response to Mayor O'Neill's question, Deputy Public Works Director Martin explained that the options for processing material areis-becoming more limited such that a two -cart blended system is challenging. Mr. O'Toole stated that the City needs to provide organic service to each resident because organics cannot be separated if mixed with recyclables or trash, noted that the City will not meet the requirement to separate organic waste with the two -cart system, and confirmed that CR&R has reached the same conclusion. In response to Council questions, Deputy Public Works Director Martin reported staff researched using a split -body truck that can collect and haul two different types of material, but it is expensive and CR&R does not use this type of truck. He stated that, when the Municipal Code is updated, enforcement can be utilized where education has not been successful, noted that 18 months is the recommended length of time to fully implement a successful program, believed residents have to be more selective about managing their carts, handling their trash and breaking it down with the three -cart system. Public Works Director Webb added that residents may use two smaller cans rather than one large can. Deputy Public Works Director Martin related that staff will work with residents who need more cans and discuss with Council about options for providing multiple cans. Volume 64 - Page 570 City of Newport Beach Study Session and Regular Meeting November 24, 2020 Deputy Public Works Director Martin continued the presentation with an overview of preliminary pricing received from CR&R, contract unknowns, negotiation options, and proposed costs per household. In response to Council questions, Deputy Public Works Director Martin indicated there are other cities that have implemented similar programs and CR&R has contracts with some of those cities, stated that the City can provide blue cans now so that residents can begin putting material into the correct cans and sorting excess waste. Mayor Pro Tem Avery believed residents should be made aware of ways to reduce waste, the City should impose penalties for large amounts of trash, businesses operating group homes in neighborhoods that are for-profit businesses should not be paying a residential rate, and a program that educates and is supported by residents will help with compliance. Mayor O'Neill noted shopping local would decrease packaging and waste. In response to Council Member Brenner's questions, Deputy Public Works Director Martin reported that, through education and outreach, staff will identify and address residents' needs. Public Works Director Webb added that staff has discussed a potential valet service for residents who need assistance, options for cost recovery, and noted that Council will take action on this during Item 20. Deputy Public Works Director Martin related that some cities have an exclusive franchise under which one hauler collects all refuse and noted that the City currently operates under an open franchise. Public Works Director Webb clarified that an exclusive franchise could potentially reduce the number of trucks and provide less choice, but may result in a lower cost. Council Member Duffield shared his obv�tions and support of sorting refuse in Oregon, which starts in the kitchen. _ Council Member Dixon indicated a successful program will require education and behavior change, the program will benefit the environment and lower operating costs, and noted that the "Brooklyn New Yo -fines residents and will not pick up refuse if it is not sorted correctly. d- Deputy Public Works Director Martin continued the presentation with a comparison of residential organics programs in Orange County cities and options for residential refuse service (Item 20). Mayor O'Neill noted that he is a member of the Residential Refuse Ad Hoc Committee, along with Council Memrers Brenner and Dixon, and recommended a hybrid of Options 1 and 2, stated that the responses to a Request for Proposal (RFP) would include uncertainty premiums, confirmed his preference would be to approve an extension (Item 20) to provide time to reach a deal with CR&R by the second meeting in January or make a recommendation to go out to an RFP, or both, and concluded by suggesting staff present the best offer from CR&R and bring it to Council and, if it is not approved, Council would initiate the RFP process knowing the responses may be higher without the reconciliation concept. In response to Council Member Dixon's questions, Deputy Public Works Director Martin indicated the City of Laguna Beach uses Waste Management and stated that negotiations can address some additional cost adjustments, but the bulk of negotiations have been concluded. Council Member Dixon concurred with the Mayor's recommendation. Deputy Public Works Director Martin concluded the presentation with a discussion of exclusive commercial refuse collection zones, five different haulers driving through Marine Avenue and Corona del Mar daily, potential resolutions for truck -impacted areas, and exclusive commercial franchise zones. Volume 64 - Page 571 City of Newport Beach Study Session and Regular Meeting November 24, 2020 Council Member Brenner advised that she spoke to the Corona del Mar Business Improvement District (BID), merchants, and residents, regarding interest in exclusive commercial zones because the trucks are problematic for residents. She believed that putting this out to bid and having different haulers compete for the rates might save businesses money and the convenience makes it worth considering, and questioned whether Council should look at the possibility of having one hauler for both residential and commercial services. Mayor O'Neill preferred to discuss this further at the ad hoc level, was open to having the conversation, but wanted to stay focused on residential hauling. Nancy Scarbrough asked if Council has considered service for Accessory Dwelling Units (ADU) and new restrictions on trucks and fuels, and suggested placing short-term lodging in the business category. Hoiyin Ip thanked staff for undertaking a tough project, noted Laguna Beach residents use three carts, agreed with changing to the best possible optionw and hoping to change habits, expressed excitement about public education, and suggessociating trash pickup with water quality, shopping local, and environmental justice. Jim Mosher believed this item would have benefited from having*e presentation published before the meeting, recalled everyone provided their own trash carts and paying a recycling fee prior to the CR&R contract, commented that t endor is now asking residents to do what they thought they were paying the vendor to do, no CR&R serves residential areas in Newport Beach under a separate contract with a two -cart s tem and reports achieving 49% recycling in the mixed cart and 100% in the organics cart, questioned why the City cannot achieve the same results with the same system and whether the City has to reach a 75% diversion goal by 2020, indicated diversion and percentages mean nothing if the volume of trash is always increasing, believed the State's real goal is to reduce the total pounds of trash taken to the landfill per capita below a certain amount, wondered how the City is doing with that goal, and suggested it would be helpful to know how Waste Management services isolated areas of the City. Charles Klobe recalled theitching recycling to residents as optional when the City first contracted for waste hauli d advised that a number of commercial trucks cut through Newport Heights daily to reac Pacific Coast Highway. In response to Mayor O'Neill's question, Mr. Ruffridge reported CR&R is involved in providing clean air vehicles and supports changing to electric vehicles by 2035, noted that there currently are no electric trucks that can complete a route in one day, stated that electric vehicles are heavier, create more wear and tear on infrastructure, and haul smaller loads, added that technology is not there yet for larger trucks, and confirmed that CR&R is the last company in the county to provide two -cart programs in Newport Beach, Costa Mesa, Stanton and Rossmoor and has proposed changing to a three -cart system. In response to Council Member Dixon's question, Mr. Ruffridge stated that most trucks use Compressed Natural Gas (CNG) and Renewable Natural Gas (RNG), RNO is cleaner than electricity because it has negative impacts on the environment, getting to 75% is tough, and CR&R is the only company with a contract to burn garbage in lieu of coal at cement plants through the Engineered Municipal Solid Waste (EMSW) program. Mayor O'Neill reiterated the thought process behind his recommendation of Option B-1. III. PUBLIC COMMENTS Hoiyin Ip thanked Council Members for attending the Circulation Element workshop and suggested making online workshops more exciting and giving participants homework, a cliff hanger or a takeaway before and after the meetings, and commented that public participation doubled during the "FAFAissi�B Me etii4g workshop's comment period. Volume 64 - Page 572 City of Newport Beach Study Session and Regular Meeting November 24, 2020 Dennis Bress congratulated the team effort on a long journey, noted the 20 beds and the important wraparound services will help the homeless move forward with their lives, thanked staff, Costa Mesa, and Council for making this happen, and appreciated that the less fortunate are receiving help. Council Member Brenner appreciated every member of the Homeless Task Force for attending the difficult meetings. Motion by Mavor O'Neill, seconded by Council Member Brenner, to a) determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; b) approve the Memorandum of Understanding Between the Cities of Costa Mesa and Newport Beach for the Funding, Development and Shared Use of a Temporary Shelter Facility, and authorize the Mayor and City Clerk to execute the Memorandum of Understanding; and c) approve Budget Amendment No. 21-018, appropriating $1,600,000 and authorize the City Manager to pay the one-time monetary contr& tions toward the shelter's capital and furniture, fixtures and equipment as specified in the agree ML With Council Members Duffield and Herdman absent, thl motik* carried 5-0. 19. Year -End FY 2019-20 and FY 2020-21 Ql Financial Report [40-2020] Deputy Finance Director Montano utilized a presentation o provide an economic overview, summary of General Fund revenues for Fiscal Year (FY) 2019-20 and the first quarter (Ql) of FY 2020-21, COVID-19 impacts to other funds, General Fund expenditure overviews for FY 2019- 20 and Q1 of FY 2020-21, and General Fund sources and uses. City Manager Leung clarified that revenues were higher than projected and resulted in a $12.2 million surplus for FY 2019-20. Mayor O'Neill stated the question is how to roll back some of the budget reductions implemented for FY 2020-21. Deputy Finance Director Montancl ed the presentation with a discussion of an additional pension payment of $5 million. Mayor O'Neill reported the $5 million was budgeted and would not come from the $12.2 million, budget cuts were implemented in the order of the reduction strategy tiers but stopped at Tier 5, Tier 5% would have included the $5 million payment, and fortunately, the City did not reach that point. He agreed with the recommendation. In response to Council Member Dixon's question, Mayor O'Neill stated that the $5 million is an extra additional payment, the City has a normal payment and a default payment for the City's unfunded pension obligation and makes a discretionary payment on existing obligations, and noted that the $5 million anticipates that the Public Employees' Retirement System (PERS) will not hit its investment amounts. In response to Council Member Dixon's question, Deputy Finance Director Montano advised that the 14% decline is due to supplemental taxes coming in lower than in prior years and noted that, since November, they are actually higher than last year, there is no concern, and there has not been a decline in assessed values. Deputy Finance Director Montano concluded his presentation with a discussion of Tier 4 (Internal Service Fund Charges) reductions, recommendation 2, Tiers 1-3, and staff recommendations. In response to Council questions, City Manager Leung related that PERS' numbers lag by two years, PERS' return was 4.7% as of June 30, 2020 when the assumed rate was 7%, staff calculated the shortfall will add about $16 million to the City's unfunded liability, and the $5 million payment is critical to paying down t48t 8444; e,.i A ..ii. aiia the n;t. ., ,.. a -.ii a sizable piece of the $16 million and PERS' charge for the t- H - R&_s top r4- 4HRs i+Ht pR t4p 44 �2'/2 years before the contribution rate changes. Volume 64 - Page 581