HomeMy WebLinkAbout18 - Terminating a Non-Exclusive Franchise Agreement for Commercial Solid WasteQ SEW Pp�T
CITY OF
z NEWPORT BEACH
c�<,FORN'P City Council Staff Report
May 28, 2024
Agenda Item No. 18
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: David A. Webb, Public Works Director - 949-644-3311,
dawebb@newportbeachca.gov
PREPARED BY: Charles Springer, Senior Management Analyst - 949-718-3466,
cspringer@newportbeachca.gov
TITLE: Ordinance No. 2024-14: Terminating a Non -Exclusive Franchise
Agreement for Commercial Solid Waste
ABSTRACT:
The City of Newport Beach has been working to gain compliance with the terms of the
Non -Exclusive Commercial Solid Waste Franchise Agreement with Key Disposal &
Recycling, Inc. (Key Disposal) since its execution in August 2023. The City issued a
Notice of Default of the Franchise Agreement in February 2024 to resolve the violations.
Since the violations were not resolved, the City issued Key Disposal a Notice of Intent to
Terminate its Franchise Agreement on March 8, 2024, pursuant to Newport Beach
Municipal Code (NBMC) Section 12.63.140, with a hearing to be held on March 26, 2024.
At the March 26, 2024 meeting, the hearing was continued to April 9, 2024 (and again to
May 14, 2024) to provide Key Disposal with additional time to comply. Key Disposal did
not fulfill the outstanding requirements. At the May 14, 2024 meeting, staff recommended
termination of Key Disposal's Franchise Agreement. At the City Council's suggestion, Key
Disposal was provided the option of voluntarily relinquishing its Tier 1 franchise, and
retain their Tier 2 franchise, rather than continue with the formal termination. After the
meeting, staff requested written confirmation of relinquishment. As of Tuesday, May 21,
2024, Key Disposal has not voluntarily relinquished its franchise, nor did Key Disposal
supply a signed amendment to only allow Tier 2 service, as offered by the City.
RECOMMENDATIONS:
a) Conduct a hearing to consider the termination of the Non -Exclusive Commercial Solid
Waste Franchise Agreement with Key Disposal & Recycling, Inc.;
b) 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;
and
c) Waive full reading, direct the City Clerk to read by title only, introduce Ordinance
No. 2024-14, An Ordinance of the City Council of the City of Newport Beach,
California, Terminating a Non -Exclusive Franchise Agreement for Commercial Solid
Waste in its entirety, and pass to second reading on June 11, 2024.
18-1
Terminating a Non -Exclusive Franchise Agreement for Commercial Solid Waste
May 28, 2024
Page 2
DISCUSSION:
The City utilizes a Franchise Agreement (2020 version) to allow waste haulers to collect
municipal solid waste, recyclables, organic waste, and construction and demolition debris
at non-residential properties throughout the city. This Franchise Agreement incorporates
a number of State mandates as well as standard contract provisions. Some examples
include diversion compliance and insurance.
As of March 26, 2024, there were 22 commercial waste haulers authorized to operate
within Newport Beach under a City Commercial Franchise Agreement for Solid Waste
collection and hauling. Prospective hauling firms undergo a rigorous review and approval
process to become franchise haulers. Once approved, franchise haulers can provide fixed
route and/or temporary waste collection and diversion services to clients within the city.
Franchise haulers are also subject to ongoing reviews by City staff for City Franchise
Agreement compliance.
Moreover, CalRecycle, the State agency responsible for managing statewide recycling
and waste management programs, has placed Newport Beach under a Corrective Action
Plan (CAP) due to deficiencies in meeting waste diversion requirements established by
Assembly Bill (AB) 341, AB 1826 and Senate Bill (SB) 1383 — all legislative pieces
intended to establish and meet statewide waste diversion targets for organics, green
waste and food scraps, as well as recyclable waste. Under the CAP, the City is required
to demonstrate "significant progress" in meeting the waste diversion requirements
established by the legislation.
With regard to the Non -Exclusive Commercial Solid Waste Franchise Agreement with
Key Disposal, the City has been working with the hauler to gain compliance with the terms
of its City Franchise Agreement since its execution in August 2023. Key Disposal failed
to comply with terms of the Franchise Agreement on 10 occasions. Of the 10 violations,
three pertained to late reporting, although reports were eventually submitted. The other
violations relate to the failure to deliver seven items required under the Franchise
Agreement, including:
1) A comprehensive source separation implementation plan which details how
recyclable and non -recyclable material will be sorted when discarded at the
customer's place of business in accordance with Sections 6(A), 12(A), 13(A), 13(C),
and 16 of the agreement. A source separation implementation plan should also
summarize customer outreach efforts made by the franchise hauler.
2) Results of on -site load checks, route reviews and waste characterizations of the
customer's waste stream to ensure compliance with Sections 6(F) and 7(E). These
measures are intended to "double-check" whether the source separation is effective.
3) The franchise hauler's contact tracking with the customer (Exhibit E) to ensure
adequate efforts are made by the franchise hauler to gain compliance by the
customer.
4) Updated business license information in accordance with 2020 Franchise Agreement
application requirements and Section 27(K).
18-2
Terminating a Non -Exclusive Franchise Agreement for Commercial Solid Waste
May 28, 2024
Page 3
5) Updated insurance information that meets requirements set forth in Exhibit D of the
2020 Franchise Agreement.
6) Updated fleet list and collision avoidance information for vehicles utilized in the city,
including an organic material collection vehicle in accordance with Section 18.
7) Route information and maps per waste stream as required by CalRecycle.
Key Disposal advised the City that it would cure the default, but was only able to cure
three of the seven items (Items 4, 6, and 7). Therefore, the default was not cured. Key
Disposal failed to appeal the Notice of Default (Attachment B) within 10 days of issuance,
as allowed per Section 23.0 of the 2020 Franchise Agreement. The City issued a Notice
of Default of the Franchise Agreement in February 2024 to resolve the violations. After
much effort and since the violations were still not resolved, the City issued Key Disposal
a Notice of Intent to Terminate its Franchise Agreement on March 8, 2024, pursuant to
Newport Beach Municipal Code (NBMC) Section 12.63.140, with a hearing to be held on
March 26, 2024.
At the March 26, 2024 meeting, the City Council granted a time extension, providing Key
Disposal until April, 9, 2024, to comply. The City and Key Disposal believed additional time
was still needed for compliance and on April 9, 2024, City staff asked to instead return to
the Council on May 14, 2024. The request was approved by the City Council.
Compliance Efforts Between March 26, 2024 and May 14, 2024, City Council
meetings.
On Monday, April 1, 2024, City representatives met with Key Disposal to discuss
compliance with its City Franchise Agreement. Key Disposal and the City agreed to the
following task list:
Task 1 — By April 5, 2024, identify a mixed -waste recovery facility for utilization until
the end of calendar year 2024.
Task 2 — Conduct a waste characterization audit and supply report.
Task 3 — Document outreach.
Task 4 — Develop an implementation plan to place external source separated
containers and to assist the commercial business with internal source
separation.
Task 5 — Submit Exhibit E Report.
The aforementioned tasks were intended to gain compliance with fundamental terms of
the City Franchise Agreement. Namely, Section 6 (Diversion and Disposal of Municipal
Solid Waste, Recyclable Materials, Food Scrap and Green Waste), Section 8
(Franchisee's Application; Records; Audits), Section 12 (AB 341 Recycling Program for
Commercial Premises and Multifamily Dwellings), Section 13 (AB 1826 Food Scrap
Diversion Program for Commercial Premises), Section 14 (AB 1826 Commercial and
Multifamily Green Waste and Wood Waste Collection Program) and Exhibit E. Key
Disposal identified a mixed -waste recovery facility for waste diversion in the timeline
specified. The City approved the selection and deemed Task 1 complete.
18-3
Terminating a Non -Exclusive Franchise Agreement for Commercial Solid Waste
May 28, 2024
Page 4
At the City's direction, Key Disposal conducted a waste characterization audit at its
facility, located at 5202 Industry Avenue in Pico Rivera, on April 11, 2024. City
representatives were present to monitor the audit. The compactor contents, which up to
this date were typically just sent to the landfill, consisted mainly of divertible/recyclable
material which does not comply with Section 6 of the 2020 Franchise Agreement.
Key Disposal was to supply a follow-up waste characterization report that included:
1) The date and time the material was collected
2) The location and name of the inspection facility
3) Images from the waste inspection that included any contamination in the transported
container
4) The waste characterization
5) Weight tickets from the selected material recovery facility
The City did not receive an update or waste characterization report from Key Disposal
and therefore emailed the waste hauler on April 17, 2024, to remind its staff that the waste
characterization report was due and what it should include. Key Disposal acknowledged
its staff was working on the report. As of 11:06 am April 24, 2024, the City had not received
an update or response from Key Disposal and requested the waste characterization
report submission by end of day. Due to the limited communication from Key Disposal,
the City also set a revised deadline for the remaining deliverables of Friday, April 26,
2024. By end of business April 24, 2024, Key Disposal submitted a waste characterization
report that omitted the location and name of the inspection facility and images from the
waste inspection. Additionally, the waste characterization results supplied by
Key Disposal varied significantly from those of the City's monitors. City staff asked
Key Disposal to update and resubmit the waste characterization report with the remaining
deliverables by end of business, April 26, 2024.
As of the end of business, Friday, April 26, 2024, Key Disposal submitted its response to
address Tasks 2 through 5. The City reviewed the responses and deemed Tasks 2 and
5 as complete and Tasks 3 and 4 as still incomplete. Due to inconsistent communication
with and information supplied by Key Disposal, City staff communicated with a
representative from Key Disposal's single Newport Beach client, the Logistics and
Fulfillment Supervisor, on Monday, April 29, 2024, for verification. City staff confirmed that
educational material was not supplied to store personnel, a scheduled walkthrough with
store personnel did not transpire, and implementation attempts were not made.
Key Disposal continued to submit documentation after the deadline. Two items were not
complete as of May 14, 2024, and to verify documentation and narrative supplied by
Key Disposal, City staff called the store representative. Store personnel confirmed that
Key Disposal inquired about placing source separation stickers on internal containers, but
did not recommend having an external recycling bin near the compactor.
Key Disposal did not fulfill the outstanding requirements so at the May 14, 2024 City
Council meeting, staff's findings were presented to the Council and staff recommended
termination of Key Disposal's Franchise Agreement. As part of the item discussion, City
Council presented Key Disposal with two options:
-:
Terminating a Non -Exclusive Franchise Agreement for Commercial Solid Waste
May 28, 2024
Page 5
1) Key Disposal could voluntarily relinquish the Tier 1 (fixed route) component of its
franchise, or
2) Key Disposal's franchise agreement could continue with the formal termination
process.
Staff reached out to Key Disposal after the meeting and requested written confirmation of
its voluntary relinquishment of its Tier 1 franchise component and that once received, an
amended franchise agreement limiting operating authority to Tier 2 service would be
provided. Staff provided Key Disposal with a deadline of 12 p.m. on May 16, 2024, and
allowed for voluntarily relinquishment of the entire franchise with the option of amending
its current franchise to only a Tier 2 hauler. Key Disposal did not provide its selection
within the timeline allotted. After the deadline, on May 17, 2024, City staff again reached
out to Key Disposal and provided a copy of the amended franchise agreement permitting
only Tier 2 service in the city and requested two fully executed copies to be submitted by
the end of business on Monday, May 20, 2024. Key Disposal was also provided an
alternative to fully executing the amended franchise; written notice signed by an officer of
the company fully relinquishing the existing franchise agreement. Key Disposal
responded that its counsel was reviewing the options. As of the end of day May 20, 2024,
Key Disposal had not provided a response. Staff now recommends termination of the
entire City Commercial Solid Waste Franchise with Key Disposal.
FISCAL IMPACT:
This franchise hauler currently represents a single account, which will most likely be
picked up by one of the other franchise commercial haulers. Nominal revenue loss is
anticipated.
ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not
result in a direct or reasonably foreseeable indirect physical change in the environment)
and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA
Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no
potential for resulting in physical change to the environment, directly or indirectly.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
ATTACHMENTS:
Attachment A
— Ordinance No. 2024-14
Attachment B
— Notice of Default
Attachment C
— Notice of Intent to Terminate
Attachment D
— Franchise Agreement
Attachment E
— Correspondence
18-5
ATTACHMENT A
ORDINANCE NO. 2024-14
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH, CALIFORNIA, TERMINATING A
NON-EXCLUSIVE FRANCHISE AGREEMENT FOR
COMMERCIAL SOLID WASTE
WHEREAS, the City Council of the City of Newport Beach ("City") finds and
determines that the collection of municipal solid waste and divertible materials, including
recyclable materials, food scraps, green waste, wood waste, construction and
demolition debris, and all other materials that can be diverted from landfill disposal
(collectively "Commercial Solid Waste") generated within the City is a vital public
service;
WHEREAS, the City Council further finds and determines that the collection,
transportation, storage and disposal of municipal solid waste and the collection,
transportation, processing and diversion of processable municipal solid waste and
divertible materials ("Commercial Franchise Services") is a matter of great public
concern because improper control of such matters subjects the City to potential liability,
damages and penalties and may create a public nuisance, air pollution, fire hazard,
infestation and other problems affecting the public health, safety and welfare;
WHEREAS, the non-exclusive franchises for the use of public streets to provide
Commercial Franchise Services promotes the public health, safety and welfare by
providing permanence and stability among those businesses wishing to provide such
service and accountability to the City for compliance with current and future state
mandates;
WHEREAS, on October 22, 2019, the City Council approved a new model
franchise agreement in compliance with state law ("2020 Franchise Agreement"), that
expires in the year 2027;
WHEREAS, the City has identified violations of the 2020 Franchise Agreement
related to subcontracting, delayed diversion reporting, diversion deficiencies and/or
failing to retain required insurance from franchisee Key Disposal & Recycling, Inc.
("Franchisee");
•
Ordinance No. 2024-14
Page 2 of 4
WHEREAS, pursuant to Article XIII (Franchises) of the City Charter, Chapter
12.63 (Solid Waste Management) of the Newport Beach Municipal Code ("NBMC") and
California Public Resources Code Sections 40059, 49300 and 49500 through 49523, or
any successor statutes, the City is authorized to enter and/or terminate non-exclusive
franchise agreements for Commercial Franchise Services with private solid waste
haulers;
WHEREAS, pursuant to Section 12.63.140 (Termination) of the NBMC, the City
transmitted a notice of intent to terminate the non-exclusive franchise to the Franchisee
that stated the City Council's intent to hold a hearing, along with the time, date and
place of hearing to be held within fifteen (15) days and sixty (60) days of the date of
notice;
WHEREAS, the City Council held a hearing on March 26, 2024, in the City
Council Chambers located at 100 Civic Center Drive, Newport Beach, California. A
notice of time, place and purpose of the hearing was given in accordance with California
Government Code Section 54950 et seq. ("Ralph M. Brown Act") and Section 1301 of
the City Charter. Evidence, both written and oral, was presented to, and considered by,
the City Council at this hearing;
WHEREAS, at the hearing, the City Council granted an extension to April 9,
2024, for Franchisee to resolve violations of the 2020 Franchise Agreement;
WHEREAS, the City requested an additional continuance to May 14, 2024, for
Franchisee to resolve outstanding violations of the 2020 Franchise Agreement;
WHEREAS, the City worked with Franchisee from March 26, 2024 to April 29,
2024, to gain compliance however, Franchisee was unable to resolve all of the
outstanding violations of the 2020 Franchise Agreement;
WHEREAS, the City Council held a hearing on May 14, 2024, in the City Council
Chambers located at 100 Civic Center Drive, Newport Beach, California. A notice of
time, place and purpose of the hearing was given in accordance with the Ralph M.
Brown Act and Section 1301 of the City Charter. Evidence, both written and oral, was
presented to, and considered by, the City Council at this hearing;
WHEREAS, at the hearing, the City Council granted an extension to May 28,
2024 to allow the Franchisee to relinquish its "Tier 1" services;
18-7
Ordinance No. 2024-14
Page 3 of 4
WHEREAS, pursuant to Section 12.63.140 (Termination) of the NBMC, the City
Council finds, on the basis of the hearing, information, materials and testimony
submitted that Franchisee has failed to comply with supplying records as requested,
including a diversion plan and implementing a three -container source separation
program; and
WHEREAS, having considered all oral and documentary evidence presented at
the hearing, the City Council determines that the termination of the 2020 Franchise
Agreement with Key Disposal & Recycling, Inc. is in the public interest.
NOW THEREFORE, the City Council of the City of Newport Beach ordains as
follows:
Section 1: The 2020 Franchise Agreement with Key Disposal & Recycling, Inc.
is hereby terminated.
Section 2: The recitals provided in this ordinance are true and correct and are
incorporated into the substantive portion of this ordinance.
Section 3: If any section, subsection, sentence, clause or phrase of this
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, sentence, clause or phrase hereof, irrespective of the fact that any one or
more sections, subsections, sentences, clauses or phrases be declared invalid or
unconstitutional.
Section 4: The City Council finds the introduction and adoption of this
ordinance is not subject to the California Environmental Quality Act ("CEQA") pursuant
to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable
indirect physical change in the environment) and 15060(c)(3) (the activity is not a
project as defined in Section 15378) of the CEQA Guidelines, California Code of
Regulations, Title 14, Division 6, Chapter 3, because it has no potential for resulting in
physical change to the environment, directly or indirectly.
18-8
Ordinance No. 2024-14
Page 4 of 4
Section 5: The Mayor shall sign and the City Clerk shall attest to the passage
of this ordinance. The City Clerk shall cause the ordinance, or a summary thereof, to be
published pursuant to City Charter Section 414. This ordinance shall be effective thirty
(30) calendar days after its adoption.
This ordinance was introduced at a regular meeting of the City Council of the City
of Newport Beach held on the 28th day of May, 2024, and adopted on the 11th day of
June, 2024, by the following vote, to -wit:
AYES:
NAYS:
ABSENT:
WILL O'NEILL, MAYOR
/_1i1*16
LEILANI I. BROWN, CITY CLERK
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
-A� t__
AAR C. HARP, CI ATTORNEY
18-9
Attachment B
CITY OF NEWPORT BEACH
�IFORr'i
John Katangian, President
Key Disposal & Recycling, Inc.
5202 Industry Avenue
Pico Rivera, CA 90660
592 Superior Avenue
Newport Beach, California 92663
949 644-3055 1 949 650- 0747 FAX
newportbeachca.gov/refuse
February 26, 2024
RE: Notice of Default for Failure to Comply with Terms of Non -Exclusive Franchise
Agreement For Commercial Solid Waste and Divertible Materials Handling
Services
Dear Mr. Katangian:
This letter serves as a Notice of Default of the Non -Exclusive Franchise Agreement
between the City of Newport Beach and Key Disposal and Recycling, Inc. for Commercial
Solid Waste and Divertible Materials Handling Services entered between the City of
Newport Beach and Key Disposal on November 9, 2022 (Franchise Agreement).
As you are aware, the State of California has adopted an ambitious plan for the diversion
of solid waste including the adoption of Assembly Bill 341 (AB 341), Assembly Bill 1826
(AB 1826) and Senate Bill 1383 (SB 1383). To that end, the City has taken a number of
measures including, but not limited to, updating its Franchise Agreement to ensure
diversion measures are in place. In spite of those efforts, the City is on a Corrective Action
Plan (CAP) with CalRecycle and is required to demonstrate significant progress in
implementing AB 341, AB 1826, and SB 1383. Accordingly, the City requires Key
Disposal and Recycling's compliance with State mandates and the Franchise Agreement.
The City has made multiple attempts to work toward compliance with your company on
amenable terms, mainly through email correspondence and one-on-one quarterly meetings.
Specifically, the City invited Key Disposal & Recycling, Inc. to quarterly meetings in
October 2023 and January 2024, to discuss:
1) Compliance with the CAP and mandate implementation,
2) Deliverables requested by City to fulfill franchise agreement requirements,
3) Deliverables requested by City and State to ensure implementation progress,
4) Issues associated with implementation,
5) Exhibit E Referral Protocol utilization,
6) City's franchise hauler expectations regarding reporting, and
7) City's stance on subcontracting.
However, violations of the Franchise Agreement persist. The following lays out the
violations of the Franchise Agreement by Key Disposal and strict timelines that Key
Disposal must comply with so that the City does not take further action as provided in the
Franchise Agreement.
Franchise Agreement Requirements
Section 6.A. (Diversion and Disposal of Municipal Solid Waste, Recyclable Materials,
Food Scrap and Green Waste) requires your company to abide by new or additional
diversion requirements imposed by law. SB 1383 implementation is covered within this
category and the City provided notice in February 2023. The City also invited your
company to one-on-one meetings in February, April, and October of 2023 to discuss.
Sections 8.B. (Records) & D. (Inspection; Audit) require your company to make available
records pertaining to mandate and franchise compliance. Through our CAP meetings with
CalRecycle, City has been tasked with obtaining Exhibit E progress, hauler education
outreach materials provided to generators, and route information and maps per waste
stream. The City requested submission of vehicle and collision avoidance information for
truck used to collect organic material. This was to be provided by January 31, 2024.
Sections 12.A (Diversion Program) & C. (Program Implementation) require your company
to ensure compliance with AB 341 through Exhibit E reporting. City has not received
Exhibit E documentation to demonstrate full implementation. CalRecycle has determined
all generators are to have source separation represented on -site. Recycling will not be
exempted.
Sections B.A. (Food Scrap Diversion Program) & C. (Program Implementation) requires
your company to ensure compliance with AB 1826 through Exhibit E reporting. City has
not received Exhibit E documentation to demonstrate full implementation. City has
identified an organic generator which warrants source separation under SB 1383.
CalRecycle has determined all generators are to have three -container source separation
represented on -site. A waiver will not be granted for this account as a restaurant is on -site.
Sections 16 A. (Monthly Reports) & C. (Report Due Date) require your company to submit
accurate and timely monthly reports. The City requires monthly reports to be submitted by
the 25th day of the following month. The City has reached out to your company to supply
missing reports. The City has documented five instances of late reporting in 2023. The City
will focus on deficiencies in 2023, but there was an instance of late reporting in November
2022 as well. Reports were submitted late for the reporting periods of January, March,
April, May, and October 2023.
Exhibit D., Section S.A. (Evidence of Insurance) requires your company to supply updated
insurance information 15 days prior to expiration of policies. The City worked with your
company to obtain insurance compliance from March 2022 through franchise approval.
Compliance was attained in July 2023 and maintained until January 2024. After review,
updated insurance policy information is either expired or incomplete and is considered non-
compliant.
Violations of Franchise Agreement
The following ongoing violations have been documented:
18-11
Franchise
City Requests
Issue
Section
or Franchise
City Deadline
Status
Requirement
1)
Implement
Sections
Franchise
October 31,
Sufficient progress
three -container
6.A, 12.A
requirement
2023 (Exhibit
not demonstrated.
system per
& C, 13.A
and City
E progress)
Hauler has had an
generator
& C,
requests made:
effective agreement
September
December 31,
since November 20,
2023
2023 (CAP
2022.
Deadline)
December 21,
City reminded
2023
hauler of
implementation
December 28,
requirements to Key
2023
Disposal's attention
in September of
January 8, 2024
2023.
(Quarterly
Mtg)
February 5,
2024
2)
Provide City
Section
January 10,
January 31,
City -requested
with requested
8.13 & D,
2024
2024
quarterly meeting
deliverables
12.A & C,
deliverables not
13.A & C,
provided;
18.C.4.
specifically truck
detail for organic
material collection.
3)
Provide monthly
Section
Recurring
January 25,
T1 & T2 January
reporting in
16.0
franchise
2023
reporting submitted
timely fashion
requirement
November 9, 2023.
T1 & T2
January 2023
Refuse staff
emailed
submission
reminder on
November 9,
2023.
4)
Provide monthly
Section
Recurring
April 25, 2023
TI & T2 March
reporting in
16.0
franchise
reporting submitted
timely fashion —
requirement
April 26, 2023.
T1 & T2 March
2023
5)
Provide monthly
Section
Recurring
May 25, 2023
T1 & T2 April
reporting in
16.0
franchise
reporting submitted
timely fashion —
requirement
May 26, 2023.
T 1 & T2 April
2023
18-12
6)
Provide monthly
Section
Recurring
June 25, 2023
Tl & T2 May
reporting in
16.0
franchise
reporting submitted
timely fashion —
requirement
June 26, 2023.
T1 & T2 May
2023
7)
Provide monthly
Section
Recurring
November 25,
T1 & T2 October
reporting in
16.0
franchise
2023
reporting submitted
timely fashion
requirement
November 30, 2023.
T1 & T2
October 2023
Refuse Manager
sent reminder about
monthly reporting
deadlines to Key
Disposal on
December 6, 2023.
8)
Submit accurate
Section
Recurring
Recurring
City reviewed
monthly reports
16.A
franchise
requirement
monthly reporting
requirement
submission for July
2023. City notified
Key Disposal on
September 22, 2023
of missing disposal
locations. Pending
submission of
revised monthly
report.
9)
Submit accurate
Section
Recurring
Recurring
City reviewed
monthly reports
16.A
franchise
requirement
monthly reporting
requirement
submission for
December 2023.
Hauler indicated in
January quarterly
meeting that two 65-
gallon organics
carts were
implemented;
however, account
list and service
volume were
incorrect and
disposal location
was omitted.
18-13
10)
Insurance
Exhibit D
Recurring
Recurring
City worked with
franchise
requirement
hauler to gain
requirement
compliance between
March 2022 and
July 2023.
Compliance was
maintained between
July 2023 and
January 2024.
Current policy
information is
incomplete and non-
compliant.
Required Action to Cure Default
As a result, the City has been left with no other alternative but to move forward
with enforcement action. Based on the violations noted above, the City may
terminate the Franchise Agreement as provided in Section 23.H (Termination
without Right to Cure) due to violation of Sections 23.H.3 and 23.H.6 of the
Franchise Agreement. However, the City is instead giving Key Disposal the
opportunity to cure the default pursuant to Section 23.B. (Notice of Default) of the
Franchise Agreement.
To cure the default, the following items are required:
1) Provide a source separation implementation plan that includes a summary of
outreach efforts to the generator through February 13, 2024, efforts made in
calendar year 2023 to divert collected material from landfills, and documented
approach to implementation from February 14 going forward.
2) Provide results of on -site load checks, route reviews and waste characterizations for
reported generator for calendar year 2023,
3) Provide City with completed Exhibit E document for serviced account.
4) Provide City with updated business license information.
5) Provide updated insurance information that meets requirements set forth in Exhibit
D.
6) Provide City with updated fleet list and collision avoidance information for vehicles
utilized in City, including organic material collection vehicle.
7) Provide route information and maps per waste stream.
All deliverables must be supplied via email to wastereporting, a,newportbeachca.gov no
later than 12:00pm Friday, March 8, 2024.
If any deliverable is omitted from submission, the City will exercise Section 23.H.
(Tennination Without Right to Cure). All documents supplied, including this notice, may
be provided to CalRecycle.
You may request a Public Works Director Review meeting as provided Section 23.C.
(Suspension; Termination; Appeal — Public Works Director Review) of the Franchise
18-14
Agreement, within ten (10) business days of the issuance of this Notice of Default. This
date is March 8, 2024.
If you have any questions concerning the contents of this letter, please contact me at 949-
718-3466, or cspringer@newportbeachca.gov.
Sincerely,
Refuse Manager
cc: John Salazar, Acting Deputy Public Works Director
City Attorney's Office
18-15
Attachment C
CITY OF NEWPORT BEACH
FOR,'%
John Katangian, President
Key Disposal & Recycling, Inc.
5202 Industry Avenue
Pico Rivera, CA 90660
592 Superior Avenue
Newport Beach, California 92663
949 644-3055 1 949 650-0747 FAX
newportheachca.gov/municipaloperations
March 8, 2024
RE: Notice of Intent to Terminate Non -Exclusive Franchise Agreement for
Commercial Solid Waste between the City of Newport Beach and Key Disposal &
Recycling, Inc.
Dear Mr. Katangian:
You are hereby notified pursuant to Section 12.63.140(A) (Termination) of the Newport
Beach Municipal Code (NBMC) and Section 23 (Termination) of the Non -Exclusive
Franchise Agreement between the City of Newport Beach and Key Disposal & Recycling,
Inc. for Commercial Solid Waste Handling Services (Agreement), effective since August
3, 2023, that on March 26, 2024 at 5:00 p.m. in the Newport Beach City Council
Chambers located at 100 Civic Center Drive, Newport Beach, CA 92660, the Newport
Beach City Council will consider termination of the Agreement for the 10 deficiencies
pursuant to the Agreement and outlined in the Notice of Default rendered to Key Disposal
& Recycling, Inc. on February 26, 2024, as well as the firm's failure to correct and/or show
progress on these deficiencies:
1. Pursuant to Sections 6.A, 12.A & C and 13.A & C, Key Disposal & Recycling, Inc.
failed to demonstrate significant progress on State -mandated waste diversion
requirements pertaining to organic and recyclable waste, which was brought to the
firm's attention in September 2023 and given a CalRecycle-issued deadline of
December 31, 2023 in accordance with our Corrective Action Plan (CAP). Moreover,
the City also issued a corrective deadline of showing Exhibit E progress by October 31,
2023.
2. Pursuant to Sections 8.B&D, 12.A&C, 13.A&C and 18.C.4, Key Disposal &
Recycling, Inc, failed to provide the City with requested quarterly dcliverables,
specifically details related to trucks that were to collect organic material. This
information was requested January 10, 2024, and given a corrective deadline of January
31, 2024.
3. Pursuant to Section 16.C, Key Disposal & Recycling, Inc. failed to furnish required
monthly Tier 1 and Tier 2 reporting in a timely manner for the months of January,
March, April, May and October 2023.
4. Pursuant to Section 16.A, Key Disposal & Recycling, Inc. failed to submit accurate
monthly reporting, as hauler did not log information for all of its disposal locations in
its July 2023 monthly report submission per verification of City records. The City
notified the hauler of this discrepancy on September 22, 2023, and requested a revised
report submission that has not been received.
5. Pursuant to Section 16.A, Key Disposal & Recycling, Inc. again failed to submit
accurate monthly reporting for December 2023, as hauler did not completely log
reportable information. During the January quarterly meeting, hauler indicated that two
65-gallon organics carts were implemented; however, the account list and service
volume were incorrect and disposal location was omitted from the December report.
6. Pursuant to Exhibit D, Key Disposal & Recycling, Inc. has failed to furnish the City
with complete and compliant insurance information following January 2024. Insurance
compliance was maintained between July 2023 and January 2024. The City had
previously worked with hauler to gain compliance between March 2022 and July 2023.
Moreover, upon receipt of the Notice of Termination
Section 23(B) of the Agreement authorizes termination by the City if the franchisee has
defaulted in the performance of any obligation of the agreement. Additionally, NBMC
Section 12.63.140(D) authorizes the City Council to terminate the Agreement, after
providing notice and a hearing to the franchisee, if the City Council finds, in pertinent part
that, " jt]he franchisee has failed to comply with, or to do anything required of the
franchisee by this chapter, ... including, but without limitation, ... file required reports or
has violated any provision of the franchise agreement ... "
Thus, Key Disposal & Recycling, Inc. is hereby notified that the City Council will consider
termination of the Agreement at the time and location indicated above. You or a
representative may appear at the hearing and present any evidence as to why the Agreement
should not be terminated. Per NBMC Section 12.63.140, a decision will be rendered no
later than 60 days after the City Council hearing and you will receive written notice of the
decision.
Please be advised that if the Agreement is terminated, operating within the City without a
valid franchise is a violation of the NBMC.
Sincerely,.>
/Jahn Salazar
Acting Deputy Public Works Director
Municipal Operations Division
Attachment A: Notice of Default - February 26, 2024
ATTACHMENT D
Franchise Agreement - Key Disposal & Recycling, Inc.
Available separately due to bulk at:
https://ecros.newportbeachca.gov/WEB/DocView.aspx?id=2900401 &dbid =0&repo=CNB
WON
ATTACHMENT E
From: Summerhill, Yolanda
Sent: May 23, 2024 1:00 PM
To: Brown, Leilani
Subject: FW: phone call Regarding letter [IMAN-CAO.FID355386]
5/28/24 Key Disposal Correspondence
From: O'Neill, William <woneill@newportbeachca.gov>
Sent: May 23, 2024 8:55 AM
To: Webb, Dave (Public Works) <DAWebb@newportbeachca.gov>; Leung, Grace <gleung@newportbeachca.gov>;
Summerhill, Yolanda <YSummerhill@newportbeachca.gov>
Subject: Fwd: phone call Regarding letter
Mayor Will O'Neill
woneill@ newportbeachca.gov
100 Civic Center Dr.
Newport Beach, CA 92660
Begin forwarded message:
From: "O'Neill, William" <woneill@newportbeachca.gov>
Date: May 23, 2024 at 8: 53 : 54 AM PDT
To: Info keydisposalinc <info@keydisposalrecycling.com>
Cc: Eliza keydisposalinc<eliza@keydisposalrecycling.com>
Subject: Re: phone call Regarding letter
No. The only reason this wasn't decided at the last meeting was because
you agreed to terminate the franchise agreement with the city at a particular
tier. I took you at your word and did so in good faith. If the call is meant to
discuss anything other than that, then we will simply hold a hearing and
determine the right course of action.
Mayor Will O'Neill
woneill@newportbeachca.gov
100 Civic Center Dr.
Newport Beach, CA 92660
1
18-18a
On May 22, 2024, at 4:11 PM, Info keydisposalinc
<info@keydisposalrecycling.com> wrote:
[EXT 'ANAL EMAIL] DO ' TC- 16K links or attachments unless you recognize the
sender and know the content is safe.
Good afternoon,
John and I would like talk to you before the next council meeting
regarding the issues from the attached letter. Looking forward to
speaking to you when you are next available. My cell is 714-887-
7924 and Johns is 213-305-2111.
Thank you,
Shelline Katangian
Key Disposal and Recycling, Inc.
323-721-5441 Office
323-430-0096 Direct
714-887-7924 Cell
323-246-0254 Fax
KEr'
ff
DISPOSAL & RECYCLING
323.721.5441
<NEWPORT BEACH MAYOR LETTER #2 (002).doc>
<image002.png>
2
18-18b
May 13, 2024
Mayor Will O'Neill
City of Newport Beach
100 Civic Center Drive
Newport Beach, CA 92660
Dear Mayor O'Neill:
I am writing this letter to offer an update on those matters the Council
wanted corrected in regards to Key's Disposal & Recycling service of
the Rolloff container at Bloomindales Department Store, and in
response to the memo sent to Key on April 29, 2024 from Charles
Springer.
It is our understanding that this matter will return to Council on May
14 for further consideration.
Given the May 14 Council date, it seems Mr. Springer's memo of April
29 in which he states he wishes to pursue termination of Key Disposal &
Recycling, based on his evaluation of two items that are in the
completion stage, is premature at best, and I believe misinformed.
I have listed below further progress to bring these items, listed as Task 3
and 4, into City compliance and have added recommendations for a
program that will assist Bloomindales and Key better coordinate a
program that starts inside the store and ends with Key's
collection/recycling material destinations.
18-18c
TASK 3---Generator Outreach.
With regard to the agreement from the Store and the 2023 tonnage
amounts, this has been previously submitted. Also, previously
submitted was a notice of Key and Store personnel as it pertains to
providing outreach and educational materials to the Store. We have
had no information from the Store over the past period of time that
changes in Store personnel may have resulted in Key materials not
being sent to the appropriate person.
Nor have we been informed by the Store what their internal procedures
are/were, how they distributed our materials and if additional specific
education materials would be needed. While Key did not record specific
dates and delivery times and Store reception/personnel, in hindsight we
probably should have. This is why we are recommending specific
meeting times with relevant Store personnel to review the
outreach/education material at the Store location on a regular schedule.
NOTES: A walk-through meeting at the Store to review these matters
is set for May 9.
Attachment A. While not all of the Key educational/outreach materials
have been saved, specific notes and materials have been communicated
to the Store.
See ATTACHED Materials.
Usually Key outreach/educational materials follow specific themes:
Outlining regulatory and State mandates that change or add to waste
sorting, contamination, and the use of newly designed containers to
address meeting our recycling objectives Other education materials are
reviewed with customers to address specific customer problems, such as
contamination, material sorting, use of recycling containers, etc. A
continuing problem is just to persuade customers to recycle.
18-18d
Task 4 — Diversion Plan.
Waste assessment for instore containers has been difficult to obtain for
several reasons:
-A reliable instore information source. This included the information
needed to design and execute an interior source separation program,
which is beyond our scope of work for this account.
-As noted a meeting is set for Store representatives and Key personnel
for May 9 at the Store to obtain specific information the City deems
necessary for our reports and — to establish a line of direct
communication that will include store contacts, distribution of Key
materials, and regular instore meetings.
-It is recommended that the City needs to decide for various reporting
responsibilities between Key and Waste Management.
Waste Management is the collector/recycler on record for the Store
Recycling Materials and Organics. (Some of which we find in our
compactor.)
Key has made significant progress on the issues identified as requiring
additional work. We anticipate by the May 14 Council meeting date we
will have effectively resolved the outlined issues.
18-18e
Key Disposal & Recycling thanks the Mayor and City Council for the
opportunity to meet all City and State recycling/waste requirements.
We hope to have the opportunity to continue serving commercial
customers in Newport Beach for another 30 years.
Sincerely,
John Katangian, President
Key Disposal & Recycling
cc. Newport Beach City Council.
Mr. Charles Springer, Public Works Department
18-18f
From: Dan keydisposalinc <dan@keydisposalrecycling.com>
Sent: May 21, 2024 4:49 PM
To: Summerhill, Yolanda <Yuummerhill@newportbeachca.gov>; Shelly keydisposalinc
<shelly@keydisposalrecycling.com>
Cc: Webb, Dave (Public Works) <DAWebb@newportbeachca.gov>; Salazar, John
<JSalazar@newportbeachca.gov>; Springer, Charles <CSpringer@newportbeachca.gov>; Gerdy, Deb
<dgerdy@newportbeachca.gov>; John keydisposalinc<john@keydisposalrecycling.com>; Eliza
keydisposalinc<eliza@keydisposalrecycling.com>
Subject: RE: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
[EXTERNAL EMAIL] 171 NOT CLICK links or attachments unless you recognize the sender
Fontent is safe. � im in
Good afternoon Yolanda,
Received and we have an email going to the mayor. We were not aware that council did not include
final report to council. It didn't contain our final response for Tasks 3 and Tasks 4. That was sent on
May 10th at 2:33pm.
Thank you,
Shelline Katangian
Key Disposal and Recycling, Inc.
323-721-5441 Office
323-430-0096 Direct
714-887-7924 Cell
323-246-0254 Fax
OsOKE
AL & REEVEL ING
323-721- 441
From: Summerhill, Yolanda<YSummerhill(@newportbeachca.gov>
Sent: Tuesday, May 21, 2024 11:17 AM
To: Shelly keydisposalinc shelly(@ke)ldisposalrecycling.com>
Cc: Webb, Dave (Public Works) DAWebb(@newportbeachca.gov>; Salazar, John
<JSalazar(@newportbeachca.gov>; Springer, Charles<CSpringerl@newportbeachca.gov>; Gerdy, Deb
<dgerdy(@newportbeachca.gov>; John keydisposalinc<iohnCcDkeydisposalrecycling.com>; Dan
keydisposalinc <dan(@ke)tdisposalrec)lcling.com>
Subject: RE: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
Good morning,
In light of the fact that the City did not receive the executed amended franchise agreement
and/or written confirmation of relinquishment yesterday, the agenda will include the
termination hearing on Tuesday, May 28, 2024. The regular meeting is scheduled to start at
5:30 pm.
Yolanda
18-19
From: Summerhill, Yolanda
Sent: May 17, 2024 12:27 PM
To: Shelly keydisposalinc<shelly(@keydisposalrec)zcling.com>
Cc: Webb, Dave (Public Works) <DAWebb(@newportbeachca.gov>; Salazar, John
<JSalazar(@newportbeachca.gov>; Springer, Charles <CS ringer(@newportbeachca.gov>; Gerdy, Deb
<dgerd) C(@newportbeachca.gov>; John(@keydisposalrec)lcling.com; dan(@keydisposalrec)lcling.com
Subject: RE: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
Hi Shelly,
I just returned your call but was unable to get through. Attached is an amended franchise
agreement with Key Disposal to permit Tier 2 service in the city.
Please return two U fully executed (two officers' wet signatures) to the City Atorney's Office
located at 100 Civic Center Drive in Bay 2E by Monday end of business day so that we can remove
the termination hearing from the May 28, 2024, City Council agenda. In the alternative to fully
executing the amended franchise, Key Disposal may provide written notice signed by an officer of
the company that it fully relinquishes the existing franchise agreement.
We look forward to resolving this matter.
Best,
Yolanda
From: Shelly keydisposalinc<shelly(cDkeydisposalrecycling.com>
Sent: May 16, 2024 1:45 PM
To: Summerhill, Yolanda<YSummerhill(@newportbeachca.gov>
Cc: Webb, Dave (Public Works) <DAWebb@newportbeachca.gov>; Salazar, John
<JSalazar@newportbeachca.gov>; Springer, Charles <CSpringer@newportbeachca.gov>; Gerdy, Deb
<dgerd) C(@newportbeachca.gov>
Subject: Re: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
18-20
[EXTERNAL EMAIL] DO NOT CLICK links or attachments unless you recognize the sender and know the
content is safe.
We want to see the staff report to council we want to make sure it's complete before we make a
decision.
Get Outlook for iOS
From: Summerhill, Yolanda<YSummerhillPnewportbeachca.gov>
Sent: Thursday, May 16, 2024 1:06 PM
To: Shelly keydisposalinc <Shelly(@ke)zdisposalrecycling.com>
Cc: Webb, Dave (Public Works) <DAWebb(@newportbeachca.gov>; Salazar, John
<JSalazar(@newportbeachca.gov>; Springer, Charles<CSpringer(@newportbeachca.gov>; Gerdy, Deb
<dgerdy(@ newportbeachca.gov>
Subject: RE: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
Hi Shelly,
Unfortunately, the agenda is finalized with the exception of this item. It is my understanding from
the representations that were made at the meeting that this was acceptable to Key Disposal.
Moreover, I spent considerable time yesterday revising Key Disposal's franchise agreement to
narrow the agreement Tier 2 services. If Key Disposal is unable or unwilling to agree to relinquish its
Tier 1 rights forthwith then we will have no option but to move forward with requesting termination
altogether.
As I mentioned, your other option to have this item fully removed from the City Council agenda is to
relinquish the franchise agreement altogether and then apply for Tier 2 only. But I need an answer
immediately.
Thanks in advance for your cooperation on this.
Best,
Yolanda
From: Shelly keydisposalinc<sheIly(@keydisposaIrecycling.com>
Sent: May 16, 202412:05 PM
To: Summerhill, Yolanda<YSummerhillPnewportbeachca.gov>
Cc: Webb, Dave (Public Works) <DAWebb(@newportbeachca.gov>; Salazar, John
<JSalazar(@newportbeachca.gov>; Springer, Charles <CSpringerPnewportbeachca.gov>; Gerdy, Deb
<dgerdy(@newportbeachca.gov>
18-21
Subject: Re: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
[EXTERNAL NOT CLICK links
Content is safe. J
Still waiting on counsel, please give us more time.
Thank you,
Shelline
Get Outlook for iOS
From: Shelly keydisposalinc<shelly(@keydisposalrecycling.com>
Sent: Thursday, May 16, 2024 8:03 AM
To: Summerhill, Yolanda<YSummerhill(@newportbeachca.gov>
Cc: Webb, Dave (Public Works) <DAWebb(@newportbeachca.gov>; Salazar, John
<JSalazar(@newportbeachca.gov>; Springer, Charles<CSpringer(@newportbeachca.gov>; Gerdy, Deb
<dgerdy(@ newportbeachca.gov>
Subject: Re: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
Good morning Yolanda,
Our counsel has to review it and I'll let you know when it's done.
Get Outlook for iOS
From: Summerhill, Yolanda<YSummerhillPnewportbeachca.gov>
Sent: Thursday, May 16, 2024 8:01 AM
To: Shelly keydisposalinc <Shelly(@keydisposalrecycling.com>
Cc: Webb, Dave (Public Works) <DAWebb(@newportbeachca.gov>; Salazar, John
<JSalazargnewportbeachca.gov>; Springer, Charles<CSpringer(@newportbeachca.gov>; Gerdy, Deb
<dgerdy(@newportbeachca.gov>
Subject: RE: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
Hi Shelline,
Please let me know no later than noon. Your other option is to relinquish the existing franchise
entirely and then reapply as a Tier 2. If we don't hear from you by noon, we will leave it on calendar
as a termination.
Best,
Yolanda
From: Shelly keydisposalinc<shellyPkeydisposalrecycling.com>
Sent: May 15, 2024 6:07 PM
18-22
To: Summerhill, Yolanda<YSummerhill(@newportbeachca.gov>; Shelly keydisposalinc
<shelly(@keydisposalrecycling_com>
Cc: Webb, Dave (Public Works) <DAWebb(@newportbeachca.gov>; Salazar, John
<JSalazar(@newportbeachca.gov>; Springer, Charles<CSpringer(cDnewportbeachca.gov>; Gerdy, Deb
<dgerdy(@ newportbeachca.gov>
Subject: Re: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
[EXTERNAL EMAIL] DO NOT CLICK links or attachments unless you recognize the sender and know the
content is safe.
Hi Yolanda,
I have forwarded this to our council. I'll let you know if they have any questions or concerns.
Thank you,
Shelline
Get Outlook for iOS
From: Summerhill, Yolanda<YSummerhill(@newportbeachca.gov>
Sent: Wednesday, May 15, 2024 4:30 PM
To: Shelly keydisposalinc <shelly(@keydisposalrec)lcling.com>; John keydisposalinc
<iohn(@keydisposalrecycling.com>
Cc: Webb, Dave (Public Works) <DAWebbPnewportbeachca.gov>; Salazar, John
<JSalazar@newportbeachca.gov>; Springer, Charles<CSpringer(@newportbeachca.gov>; Gerdy, Deb
<dgerdy(@ newportbeachca.gov>
Subject: May 14, 2024 City Council Hearing re: Non -Exclusive Commercial Solid Waste Franchise
Agreement [IMAN-CAO.FID355386]
Good afternoon Mr. & Mrs. Katangian,
Following up on last night's City Council hearing, please provide written confirmation to our office
that Key Disposal is relinquishing its right to provide Commercial Solid Waste Handling Services, also
known as "Tier 1" service in Newport Beach. With that written confirmation, the City Attorney's
Office will amend Key Disposal's Franchise Agreement to provide "Construction and Demolition
Debris" services, otherwise referred to as "Tier 2" service in Newport Beach. Since the Council
continued this matter to May 28, 2024, it is imperative that we receive your written confirmation
immediately.
Additionally, below is the link to Chapter 12.63 of the Newport Beach Municipal Code related to
franchise agreements. Following up on our conversation earlier today, in the event a new
application is made to the City for a franchise, a finding is required that the applicant has not within
the past three years had a franchise for commercial solid waste handling services terminated by the
City.
We look forward to hearing from you so that we can resolve this matter.
Best,
Yolanda
18-23
From:
Shelly keydisposalinc
To:
SSprinaer. Charles
Cc:
WasteReporting; Eliza keydisposalinc; Info keydisposalinc; Salazar. John
Subject:
Task 3 and Task 4
Date:
May 10, 2024 2:33:57 PM
Attachments:
imaae001.aif
image007.pnng
imaae009.Dna
image011.png
imaae013.Dna
Task 3- Backhual Description from Bloominadales by Email.pdf
Task 3- Outreach Material sent Via Email.Ddf
Task 3- Outreach Educartional Material.pdf
Task4-WasteAna IysisPictu res. pdf
Backup for recycling bin quote.pdf
[EXTERNAL EMAIL] DO NOT CLICK links or attachme
content is safe.
Good afternoon Charles.
Task 3 — Generator Outreach:
Recycling flyers were emailed to customer representative on May 6th. Outreach materials were also
delivered to customer in person during May 9th waste analysis at customer location. During waste
analysis walk thru explanation of mandatory recycling was discussed and customer responded that
they have segregated recycling receptacle for wood, plastic, paper, and organics provided by Waste
Management.
Backhaul agreement was not provided, however, they did explain in an email attached that their
trailers carrying recyclables are backhauled to a facility in City of Industry. In addition, they have an
agreement with International Paper for OCC (Cardboard).
Task 4 — Diversion Plan:
On May 9th we completed a waste analysis during our walk thru of customer facility both interior
and exterior. Interior containers were located in lunch room, restroom, and by floor register. Only
plastic trash containers were visible. We found opportunities for recycling of plastic bottles,
biodegradable straws, and paper. Customer notified us that they rejected our proposal for paper
recycling because they already have that in place through International Paper. We further gave our
recommendation to insert a separate receptacle next to the existing trash containers for mixed
recycling and referred to the outreach materials we provided them.
Upon analysis of exterior portion of customer site we found organic container present, wood hanger
bins in the warehouse basement, our trash compactor, and cardboard container and baler. We
recommend that they should also have a mixed recycling bin. We quoted (1) 3 yard bin, serviced (1)
pick up per week for $180.95 per month. Since they already have a recycling program through
Macy's and Waste Management for paper/cardboard, organics, and wood hangers we did not
provide pricing for these services already in place.
18-24
From: Springer, Charles <CSpringer@newportbeachca.gov>
Sent: Monday, April 29, 2024 4:06 PM
To: Shelly keydisposalinc <Shelly@keydisposalrecycling.com>
Cc: WasteReporting<wastereporting@newportbeachca.gov>; Eliza keydisposalinc
<eliza@keydisposalrecycling.com>; Info keydisposalinc <info@keydisposalrecycling.com>; Salazar,
John <JSalazar@newportbeachca.gov>
Subject: RE: Key Disposal & Recycling: Newport Beach (part 1 of 5)
Shelline,
Please see below.
Task 1: Selection of Mixed Waste Material Recovery Facility.
Determination: Complete as of April 3, 2024
Task 2 — Waste Characterization Audit:
• The City asked for the following:
• Date and time of collection
• Location and name of inspection facility
• Images from the waste inspection that includes any contamination identified as well
as the transported container.
• Waste characterization report
• Weight tickets for divertible debris that includes facility name(s) and location(s).
o The CR&R MRF weight ticket was omitted from this submission, but we
have a copy from the original that we consider as submitted (attached).
Determination: Complete as of April 26, 2024.
Task 3 — Generator Outreach:
• The City asked for the following:
o Written documentation of contacts with appropriate store personnel pertaining to
providing outreach and educational material to store personnel
o The written agreement/ arrangement from the store and the tonnage from 2023.
Determination: Incomplete.
• Written response below did not demonstrate Key Disposal provided outreach material to
store personnel. It indicated educational outreach material is obtained by Bloomingdale's
18-25
staff, but no dots were connected that Key Disposal furnished educational outreach
material to the company and explained the expectations.
• The backhaul arrangement — per an email supplied, the store acknowledged they
backhaul, but details were not supplied in your response by either store personnel or Key
Disposal & Recycling delineating the arrangement.
Task 4 — Diversion Plan:
• The City asked for the following:
• Results of the waste assessment of interior containers
• Written documentation of attempts to implement a source separation program for
interior containers.
• Written documentation of attempts to implement a recycling program that includes
an external container.
Determination: Incomplete.
• Results of the waste assessment of interior containers — incomplete
• Written documentation of attempts to implement a source separation program for
interior containers. — incomplete
o Response provided uses future tense and not past tense, indicating attempts
to implement have not been conducted.
• Written documentation of attempts to implement a recycling program that includes an
external container. — incomplete
o Response provided uses future tense and not past tense, indicating attempts
to implement have not been conducted.
Task 5 - Supply a completed Exhibit E report:
• The City asked for the following:
• A completed version of the Exhibit E Reporting Protocol must be supplied to the City.
Determination: Complete.
I called appropriate personnel at Bloomingdale's today, April 29, 2024, to confirm information
supplied in your response. They confirmed that a teams call transpired on April 22 and lasted
approximately 5 minutes. The call consisted of an image of compactor contents, but educational
materials were not provided and implementation recommendations were not made. I also asked if
store personnel had been provided educational materials by Key Disposal, if a walkthrough with
store personnel transpired, and if store personnel had any information regarding their backhaul. The
store confirmed that they had not been provided any educational materials by Key Disposal, a
scheduled walkthrough with Bloomingdale's staff did not transpire but Key Disposal came
unescorted late at night one night, and store personnel provided me with an in depth review of their
backhaul process. Store staff was very confused as to what Key Disposal was attempting.
18-26
Taking the two incomplete items into account, in addition to communication with appropriate store
personnel today, we will be pursuing termination.
Thank you,
Charles Springer
Refuse Manager
Public Works Department
Office: 949-718-3466
592 Superior Ave
Newport Beach, CA 92663
From: Shelly keydisposalinc <Shelly(@keydisposalrecycling.com>
Sent: April 26, 2024 1:54 PM
To: Springer, Charles <CSpringer(@newportbeachca.gov>
Cc: WasteReporting<wastereporting(cDnewportbeachca.gov>; Eliza keydisposalinc
<eliza(@keydisposalrecycling.com>; Info keydisposalinc <info(@keydisposalrecycling com>
Subject: Key Disposal & Recycling: Newport Beach (part 1 of 5)
[EXTERNAL EMAIL] DO NOT CLICK links or attachments unless you recognize the sender and know the
content is safe.
Task 2:
We conducted an audit of the waste container, 40 yard compactor, collected from Bloomingdales in
Newport Beach. The audit was conducted at our facility at 5202 Industry Avenue in Pico Rivera,
California on April 11th 2024 at 10:OOAM. Key Disposal & Recycling manager's present were John
Katangian, Dan Katangian, Shelline Katangian, Juan Vallejo, and Isaac Martinez.
Please see attached pictures of trash (MSW) from the compactor. Also, attached are pictures of the
container and of identified contaminated soiled cardboard.
We report that there were 75% of recyclable material, 5% of organic material, contaminated waste
15%, and construction (C%D) 5% present in the overall waste stream. Recyclables were in the form
of plastic bubble wrap, plastic bottle, plastic hangers, clear plastic bags, cardboard boxes, shoe
boxes, brown paper bags, and paper packaging. Organic material were in the form of food waste
wrappers, cups, plates, and soiled napkins. Construction material found were ceiling tiles/drywall.
Contaminated waste found were of soiled cardboard not eligible for recycling. *Waste audit pictures
will be sent separately due to size of files.
18-27
Please find attached weight ticket from CR&R Transfer Station at 11232 Knott Avenue in Stanton,
California on April 121h 2024 at 8:14AM. Tonnage was 2.78 tons.
Task 3:
On Monday, April 22nd we had a Teams meeting with Monica Ng, authorized customer
representative from their environmental and facilities department. We discussed recyclable
materials that can be diverted such as plastic hangers, cardboard boxes, and plastic bubble wrap. I
discovered that outreach and educational material for their in house diversion program are
obtained by their environmental and facility coordinators. Their personnel also conduct employee
training.
The annual tonnage for 2023 was 10.69 tons and is backhauled and recycled with International
Paper. We have requested a copy of their backhaul agreement and will provide upon receipt.
Task 4:
Based on our assessment of the interior containers they generate thin plastic trash liners with
divertible materials. Some examples are paper, plastic wrappers from packages, and empty plastic
water bottles.
We are going to recommend that they find a safe space to place around their existing trash cans a
separate receptacle for plastic and cardboard/paper, and food waste/scarps. We have followed up
with Monica Ng regarding her availability for a meeting at their store location at their earliest
convenience and to include Elizabeth Raney, supervisor of fulfilment.
In addition, we will recommend placing a 3 yard bin for emptying our the interior receptacles with
the plastic and cardboard/paper. For the food waste/scraps they will continue to use Waste
Management organic bin.
Task 5:
Please see attached Exhibit E.
From: Monica Ng
Sent: Monday, May 6, 2024 1:26 PM
To: Shelly keydisposalinc; Elizabeth Raney; Info keydisposalinc; Liz keydisposalinc; Eliza keydisposalinc
Cc: Shea Ledbetter
Subject: RE: Key Disposal and Bloomingdales (BLM720030)
Hi Shelly,
We backhaul the material on our return trailers to our Distribution Center in City of Industry.
From City of Industry, we have an agreement with International Paper for our OCC (Cardboard).
Hope this information helps.
Thank you,
Monica
Monica Y Ng
Macy's, Inc.
Mobile: 732-439-7300
---------------------
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From: Shelly keydisposalinc<shelly--@keydisposalrecycling_com>
Sent: Monday, May 6, 2024 4:14 PM
To: Elizabeth Raney <Elizabet.h.Ranee@bloomingdales:com>; Info keydisposalinc
<info@key-disposalrecycling_com>; Liz keydisposalinc <liz@keydisposalrecycling:com>; Monica Ng
<monica:y_ng_@macys:com>; Eliza keydisposalinc<eliza@keydisposalrecycling_com>
----- ---- ----
Cc: Shea Ledbetter <Shea.Ledbetter@bloomingdales.com>
Subject: Re: Key Disposal and Bloomingdales (BLM720030)
A EXT MSG:
Good afternoon Elizabeth,
I am attaching flyers for SB 1383 Outreach to let you know what you can put in your recycling container
as well as your organics bin. I will go over as well on our walk thru.
This is confirmation that on May 9th at 3pm. We will be doing a waste analysis walk.
The city is requesting the backhaul agreement with the store, can you please forward the same copy if
you provided to the city.?
Let me know if you have any questions.
Thank you,
Shelline Katangian
Key Disposal and Recycling, Inc.
323-721-5441 Office
-----------------------
323-430-0096 Direct
-----------------------
18-29
From: Shelly keydisposalinc
Sent: Monday, May 6, 2024 1:14 PM
To: Elizabeth Raney; Info keydisposalinc; Liz keydisposalinc; Monica Ng; Eliza keydisposalinc
Cc: Shea Ledbetter
Subject: Re: Key Disposal and Bloomingdales (BLM720030)
Good afternoon Elizabeth,
I am attaching flyers for SB 1383 Outreach to let you know what you can put in your recycling container
as well as your organics bin. I will go over as well on our walk thru.
This is confirmation that on May 9th at 3pm. We will be doing a waste analysis walk.
The city is requesting the backhaul agreement with the store, can you please forward the same copy if
you provided to the city.?
Let me know if you have any questions.
Thank you,
Shelline Katangian
Key Disposal and Recycling, Inc.
323-721-5441 Office
-----------------------
323-430-0096 Direct
-----------------------
714-887-7924 Cell
-----------------------
323-246-0254 Fax
................. KEY
015p45dL CYC�IIiG
323-721-5441
Thank you,
Shelline Katangian
Key Disposal and Recycling Inc.
323-721-5441 Office
.....................
Get Outlook for iOS
From: Shelly keydisposalinc<shelly(@keydisposalrecycling_com>
Sent: Monday, April 29, 2024 1:57 PM
To: Elizabeth Raney <Elizabet h_Raney@bloomingdales. com>; Info keydisposalinc
<info@key--disposalrecycling_com>; Liz keydisposalinc <liz@keydisposalrecycling:com>; Monica Ng
<monica:y_ng@macys_com>; Eliza keydisposalinc<eliza�keydisposalrecycling_com>
Cc: Shea Ledbetter <Shea _Ledbetter@ bloomingdales,com.>
Subject: Re: Key Disposal and Bloomingdales (BLM720030)
See you then!
Thank you,
Shelline
Get Outlook for iOS
18-30
Recycling is one KDR's top priorities and
successes for achieving customer satisfaction.
Recycling saves our customers money, keeps
,reusable materials out of our landfills, and
saves our limited natural resources.
Despite the shrinking world markets for
regclables, KDR is working with manufacturers
and industry recycling firms to continue to take
recyding commodity products and reaching out
to industries to expand our recycling product
list. We continue to recycle your plastics, paper
cardboard, wood, and organic materials.
wing our waste characterization study of
r waste stream, we often find recycle
ortunities for materials not regularly
cled. Examples have been rugs, rubber
cles, etc. Organic recycling has been
ended to include items like palm fronds
of course food waste.
these materials contaminati,
to be a major problem. A sin#1
container is used for "mixed i
Irpile individuall
ovided for spe
err rec+ycla
re
flity (MRF).for
NOR facile lb-,
WHY SHOULD BUSINESS'S USE
__HEY DISP03AL 8 RECYCLING?
The Key reason to use Key Rerydin� [KI)R) is to have
guaranteed best Service and the flexibility to meet your
changing waste requirements.
KDR is a third -generation family owned waste and
recycling company specializing in commercial waste and
re cling commercial waste streams throughout Southern
California.
Problems with your waste collection service?
Need to make a collection change?
Wondering why your rates are increasing all the time?
No need to go through a long corporate list of employees
located in who -knows -where to find help. With KDR your
waste needs are met one cell call, to President John
Katangion and it's done.
KDR efficiency begins with a customer waste analysis
which 'right sizes exact customer equipment allotment
and service levels to ensure the lowest rates.
SUPERIOR SERVICE: KDR establishes service programs
and schedules for customers based on currew needs,
conducts waste audits to determine what materials can he
recycled, pprovides a variety of containers for
waste/recyclable separation, size containers to fir
customers geographic needs and disposal amounts, sets
collection times to meet company schedules, etc.
With KDR comparry management just a phone call away,
customer desired Changes can be made immediately. This
includes equipment changes such as extra needed bins.
etc. KDR`s immediate response to customer needs has
netted in some cases huge saving for customers. -
R is equipped to provide the right collection equipment
I
very commercial account to insure the highest
ncy, the least business disruption, the highest
ing rateand the best economical collection program.
ncludes performing a "right sae" customer waste
to insure customer waste is collected in the most
nt manneL Ins lions to insure right sized bins are
d, collection trips managed to reduce costs,
ion times set to fit the customer`s schedule, and
tion flexibility to meet customer unscheduled
tiorh requirements.
ed a COMPACTOR Today?
Invitation To Save You Money. Customer satisfaction is
#f priority. Do you know if your current wastelrecycler
ler is giving you the best service at the lowest
ipetitive cost? Call KDR for no -obligation free service
cost estimate. Customer satisfaction starts with
Omer communication. Have a problem, need added
'ice, or less service, want to change your collection
afule? A quick call to one of KDR's owners, John or
i, and that's all it takes. No corporate maze or
Your RECYCLING Specialists
KEY DISPOSAL & RECYCLING
vmwrrMU ana►vr cvmomrHanvn +i jJrtaUnhf irrr,
material will be sent to a Material Rew
n
;acility (MRF) where it is sorted and cl
Vhem appropriate KDR also sorinrn
heir facility to insure recyclab
mndfilled.
Customer Waste Characterization Study.
Analyze Collected Waste. Waste Categorized
Into Three Types;
Waste Disposal Recyclable Material` Potential
Recyclable Material.
Material Separation Where Applica a At Key
Facility Or MRF.
Waste Material -To Transfe4 Landfill, or MRE
Recyclable Material -To Recycle Center or MRF
For Specific Types of Material. '
Potential Recyclable Material -Analyzed For
Specific Types of Recycling -Reuse.
Contamination is often a factor preventing
recycling. Key designs customer collection
programs and equipment to eliminate
contamination at the collection site, and will
perform additional sorting at facility if
required.
Eonstruclion & Oemoliliau
"LOW BOYS" Ready to Roll!
Overview of SB 1383:
► SB 1383 establishes aggressive organic waste reduction targets.
► SB 1383 also builds upon the Mandatory Commercial Organics
Recycling law (AB 1826).
1 Our jurisdiction has been implementing this law since 2076.
► SB 1383 requires Californians to reduce organic waste disposal by
50% by 2020 and 75% by 2025.
These targets use CalRecycle's 2074 Waste Characterization Study
measurements when 23 million tons of organic waste were disposed.
0 These disposal reductions will reduce at least 4 million metric tons of
emissions annually by 2030.
Additionally, as a part of the disposal reduction targets the
Legislature directed CalRecycle to increase edible food recovery by
20 percent by 2025.
► The food recovery goal is unique.
AB 341
Mandatory Commercial
Recycling Law
AB 341 requires commercial and
public entities that generate 4 cubic
yards or more of solid waste per week
and multi -family apartments with 5 or
more units to subscribe to recycling
services by July 1, 2012.
323 - 721.5441
Item 3
Mandatory Commercial
Organic Recycling Law
California law AB 1826 went into
effect in 2016. AB 1826 requires
businesses and schools that generate
4 or more cubic yards of solid waste
to implement a recycling system - with
full implementation realized in 2019.
s
Let
KEY DISPOSAL
Be Your Recycling Partner
PLASTICS
Soda & Water Bottles,
" Milk Jugs, Salad Dressing
Bottles
11
A ,KEY
3za �zt saat
`- 01511305AL & RECYCLING IKE
323 - 721- 544'1
PAPER
ilgk4lll
Office Paper, Flattened
Cardboard, Newspapers,
Catalogs, Magazines,
Phone Books, Paper Bags
Do not recycle the following
items listed below.
Key Disposal & Recycling Inc. 1 5202 Industry Avenue I Pico Rivera, CA 90660
Soda Bottles
Water Bottles
,Milk Jugs
Salad Dressing Bottle
Glass Bottles & Jars
Steel Cans
Aluminum Cans
White Paper
Computer Paper
Letter Head
T Recycle:
Carbon Paper
Cellphone Tape
Pens & Pencil
Photographs
Rubber Bands
Styrofoam Packaging
Stir Sticks
Tea Bags
Plants
Ma ki n g Rey I i n g Easy
Folders
"Junk" Mail Colored Paper
Magazines
Fax Paper�
Envelopes
Phone Books �w
Gift Boxes - -
Newspaper
Flattened Cardboard
Sticky Notes
L� . i1 5
.
Non Rinser
Soiled Tissues
Ceramics
Coffee Grounds
Creamer Packets
-Mg 3Z3-7Z1-5441
5202 Industry Ave.
Pico Rivera, CA 90660
18-36
KEY
015P05ALdcREC1ICLING INC
323 - 721- 5441
65 Gallon EnviroGuard Roll Out Cart
• Proven to withstand the rigors of today's household refuse,
recycling, and organics collection programs
• MeetslExceeds all ANSI type B & G container standards;
Compatible with all ANSI certified Fully- and Semi -
Automated Lift Arm Lifters
• Constructed of high -quality, resilient, UV -stabilized HDPE
temperature tested to withstand both extreme cold and extreme
heat; Flexibility to include Post -Consumer Recycled (PCR)
material to support sus(ainability goals
• Continuous, one-piece handle provides strong gripping area
designed to provide optimum control of a fully -loaded cart;
Wide wheelbase designed for easy maneuvering and stability
• Shipped with lids attached to reduce assembly time; one-piece,
blow -molded snap on (BMSO) wheels with integrated spacers
takes only seconds to attach for deployment
• Textured body offers optimum grippin
automated collection
• External, enclosed catch bar allows for Item
smooth inside without holes to mitigate
• Due to the weight of organics, 65-gall(
size available.
Materials that CAN be placed inside 65-gallon carts:
Fruit, bread, fish, meat, vegetables, dairy, fats, oil and grease
- Leftovers, sauces, eggshells, coffee grounds and their filters,
peels, pits and seeds, poultry and their bones and skin, pasta, bread,
and rice
- Grass, leaves, weeds, pruning, flowers, yard,
garden waste, twiggs or small branches,
Capacity (Galknarrstets)
ove 0 Depth (0)
overall Width (W)
Ov-11 height (D)
Assembkd Weight
53' Trailer Qutu *
CALL NOW &GET
YOURS TODAY!
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Calculator - Price Per Cubic Yard
*AB Fee depends on City percentage
$/Cubic Yd
#DIV/0!
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#DIV/0!
12.00
8.00
8.00
9.95
9.00
9.00
9.00
9.00
9.00
9.00
Bloomingdales
tnter rate in aecimal
(10% = 0.10)
FILL IN BLUE
PLEASE FILL IN COLORED AREA TO CALCULATE PRICE PER CUBIC YARD
# Bins Size of Bins # Days/Week Monthly before AB AB % AB fee Monthly Bill
2
1
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3 1
155.99
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
155.99
0.160
0.160
0.160
0.160
0.150
0.160
0.160
0.160
0.160
0.150
0.150
0.150
0.150
0.150
0.150
All locations total
24.96
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
24.96
666.68
150.79
152.30
180.95 Quote A
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
180.95
ARB 4% 7.24
Month 188.18
5/9/2024
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
18-54