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HomeMy WebLinkAbout24 - Non-Exclusive Solid Waste Collection Franchise to Kevin Ray Demolitionu 0 • TO: Mayor and City Council FROM: General Services Director City Council Agenda Item No. 6 April 12, 1999 SUBJECT: Award of Non- Exclusive Solid Waste Collection Franchise to Kevin Ray Demolition. Recommendations Adopt the attached Resolution of Intention (Resolution No. 99 -_) to award a Non - exclusive Solid Waste Franchise to Kevin Ray Demolition and to conduct a public hearing on April 26, 1999. That the attached Ordinance No. 99 -_ granting a Non - exclusive Solid Waste Franchise to Kevin Ray Demolition be introduced for a First Reading and passed on to a second reading on April 26, 1999. It is recommended that Council adopts the Ordinance granting the franchise at the conclusion of the April 26, 1999 public hearing and that it takes effect on May 26, 1999 (30 days after adoption). Background Article XIII of the City Charter (Granting of Franchises) and Chapter 12.63 of the Municipal Code (Solid Waste Management) establish requirements and procedures to grant a franchise to provide solid waste handling services within the City. There are currently fourteen solid waste franchisees operating under separate agreements to collect and transport solid waste generated within the City limits. Staff recently received a franchise application from one additional firm: Kevin Ray Demolition. The application submitted by Kevin Ray Demolition meets the minimum qualifications per Section 12.63.050 (Application for a Franchise) of the Municipal Code. Discussion Per the California Integrated Waste Management Board's diversion calculations, the City of Newport Beach disposed of forty - percent less waste in 1997 than in 1992 (the City's base year for determining compliance with AB939 waste diversion requirements). In order to meet the State's fifty - percent diversion mandate by the year 2000, the City is making an effort to account for diversion activities that occur at construction and demolition sites within City limits. C:\ TEMP \Council -S W FranchiscAwrdl Irdoc In December 1998, the City notified ten demolition contractors licensed to conduct business in Newport Beach that they would need to obtain a solid waste franchise to continue handling, hauling, and disposal operations of non - recyclable demolition waste. The application submitted is by Kevin Ray Demolition complies with the requirements outlined in the December letter. Pending completion of the public hearing and Council approval on April 26, the franchise will take effect May 26, 1999 and will expire on January 9, 2006 at the end of the City's ten -year franchise program that began in 1996. It is anticipated that cooperation from the demolition haulers and increased staff enforcement of the solid waste ordinance will make a significant difference in meeting the State diversion mandates of AB939. Very respectfully, David E. Niederhaus Attachments: (1) Resolution No. 99- Resolution of Intent to conduct a public hearing to consider the granting of a Non - Exclusive Solid Waste Franchise to Kevin Ray Demolition. • (2) Ordinance No. 99- _Ordinance granting a Non - Exclusive Solid Waste Franchise to Kevin Ray Demolition. • FAUsers \GSV\MEIdridge\MARCH 99 \C0wci1- SWFnnchiseAWrd111.dw • RESOLUTION NO. 99- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH DECLARING ITS INTENTION TO CONDUCT A PUBLIC HEARING TO CONSIDER THE GRANTING OF A NON - EXCLUSIVE SOLID WASTE FRANCHISE TO KEVIN RAY DENIOLITION. WHEREAS, the City Council finds and determines that the collection of solid waste zenerated within the City is a vital public service and that the storage, accumulation, collection, and disposal of solid waste and recyclables is a matter of great public concern because improper control of such matters would subject 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; and, WHEREAS, non - exclusive franchises for the use of public streets to provide commercial solid waste hauling services will promote the public health, safety, and welfare by promoting permanence and stability among those businesses wishing to provide such service • and accountability to the City for compliance with current and future state mandates; and, WHEREAS, pursuant to Article XIII of the City Charter and pursuant to Sections 49500 through 49523 of the Public Resources Code, the City is authorized to enter into non - exclusive franchise agreements for commercial solid waste collection services with private solid waste haulers; and, WHEREAS, Kevin Ray Demolition, a private demolition contract firm, has submitted an application requesting a Non - exclusive Solid Waste Franchise that satisfies the City's application requirements. that: NOW, THEREFORE, be it resolved by the City Council of the City of Newport Beach 1. A public hearing shall be conducted on April 26, 1999, at 7:00 p.m., or as soon thereafter as practical in the City Council Chambers, 3300 Newport Boulevard, Newport Beach, • California, to consider the .-ranting of a franchise to each applicant listed under Item 2 below Pursuant to the following terms and conditions: a. Franchise effective date: May 26, 1999. b. Quarterly franchise fee: 3.5% of gross monthly receipts for the first year of franchise term increasing by 1% per year with a cap of 10.5 %. c. Term of Franchise: May 26, 1999 to January 9, 2006 with renewal rights upon mutual agreement of the franchisee and City. d. The City shall not set the Franchisee's bin rates. e. Franchisee shall indemnify and hold harmless City from environmental liability for the franchisee's operations in the City and shall pay to the City Environmental Liability Fund, on a quarterly basis, 5.5% of gross receipts for all commercial solid waste handling services provided by the Franchisee in the City. E. Franchisee shall indemnify and hold City harmless from penalties and damages for failure to meet current and future state recycling requirements with respect to the portion of the commercial solid waste stream collected by Franchisee. g Designated disposal facility: City maintains the right to designate disposal • facilities to be used by Franchisee. h. Franchisee shall be responsible for all billing and collection for its accounts. i. Franchise shall not be revoked unless there is default under the agreement. j. Prior to obtaining a Solid Waste Franchise, the applicants shall satisfy the City's minimum qualifications regarding liability insurance, equipment, knowledge of solid waste regulations, load check programs, etc. k. Franchisee shall meet City's requirements to implement recycling and source reduction public education activities. 1. City has authority to annually audit Franchisee's financial records relating to the payment of fees required under the franchise. m. Franchisee shall comply with all State, Federal laws and regulations, terms and conditions of the franchise agreement, City Charter and Municipal Code. 2 • LA 2. The City proposes to offer a non - exclusive solid waste collection franchise to each of the following applicants listed below. Persons who have an interest in or objection to the proposed franchises may appear before the City Council and be heard on the date and time listed above. a. Kevin Ray Demolition, Kevin Ray, Owner 3. This Resolution of Intention shall be published in the City's official newspaper within 13 days ofits adoption and at least 10 days prior to April 26, 1999. 0 Adopted this 12th day of April, 1999 ATTEST: CITY CLERK F %SERSIGWMEIdddg6N6 RCH 99 tCwnciLFwchiscRalll.dm 3 MAYOR ORDINANCE NO. 99- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH GRANTING A NON - EXCLUSIVE SOLID WASTE FRANCHISE TO KEVIN RAY DEMOLITION 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 4952' ) of the Public Resources Code authorize the City to enter into non - exclusive 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 rant 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 April 26, 1999, to consider the granting of a franchise to Kevin Ray Demolition. D. Having considered all oral and documentary evidence presented at the public hearing, the City Council has determined that the granting of a non - exclusive franchise 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 Agreements A. Grant of Franchises There is hereby granted to the firm listed below (hereinafter, "Franchisee') a non- exclusive franchise to operate, maintain and provide solid waste handling services along, across and over the public streets, alleys, public ways and public places dedicated for public use in the City: (a) Kevin Ray Demolition B. Non - exclusive 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 t fn streets, alleys, public ways and places to any person at any time during the term of each franchise. C. Term of Franchise The term of the franchise per Section 2 of the Franchise Agreement ( "Agreement ") attached hereto as Exhibit A, Commercial Solid Waste Collection Franchise l,-reenzent between the Citr of Newport Beach and Kevin Rav Demolition which is hereby adopted, approved and incorporated into this Ordinance by reference, shall commence at 12:01 a.m., on May 26, 1999 and expire on January 9, 2006. The franchise shall take effect on the date specified above provided that the grantee has filed written notice of acceptance in accordance with the requirement of Section 4 of this Ordinance. D. Franchise Fees (1) During the term of the Agreement, Franchisee shall pay to City franchise fees for the privilege of providing commercial solid waste handling services in the City of Newport Beach and use of public streets, right of ways and places for such purposes. Fees shall be in the following amounts: Franchisee shall pay to the City 3.5% (eight and one -half percent) of the Franchisee's gross receipts. The franchise fee shall increase by 1% (one percent) each January during the term of the Agreement. Thereafter, the franchise fee will be capped at 10.5% for the life of the Agreement. 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 provided by the Franchisee within the City. One -half of one percent (0.5 %) 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. (2) Franchisee shall pay to the City Environmental Liability Fund, on a quarterly basis, 5.5% of gross receipts for all commercial solid waste handling services provided by the Franchisee in the City. Payment shall be made concurrently with the payment of the franchise fees and the filing of reports specified in Section 4 and Section 6 of the Agreements. • E. Inclusion of Franchise Documents 2 Franchisee shall comply with and shall be bound by all of the terns, provisions and conditions contained in the City Charter, this Ordinance, Chapter 12.63 of the Newport Beach Municipal Code and the Franchise Agreement. SECTION 4: Effective Date This Ordinance shall become effective 30 days from and after the date of its adoption; provided, however, franchise granted by this Ordinance shall not become effective unless and until grantee files written acceptance of its 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 'Nlumicipal 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 this Ordinance, the Franchise Agreement, Article XIII of the City Charter, and Chapter 12.63 of the Newport Beach Municipal Code. Grantee shall file written acceptance of the franchise no later than ten (10) days after the adoption of this Ordinance. SECTION 5: CEQA Exemption 0 The City Council of the City of Newport Beach finds that this Ordinance is categorically exempt under the California Code of Regulations Sections 15301 and 15308 defined as "existing operations and facilities" and as "actions by regulatory agencies for protection of the environment" respectively. Use of the above exemption classifications are appropriate because this Ordinance does not change nor expand existing solid waste operations and facilities within the City. The Ordinance is also consistent with the goals of California State Assembly Bill 939, The California Solid Waste Management Act as well as the objectives of 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. SECTION 6: Severability 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, clause or phrase thereof, 0 3 9 irrespective of the fact that any one or more sections, subsections, sentences, clauses, or phrases 0 be declared Unconstitutional. CJ SECTION 7: Adoption of Ordinance This Ordinance was introduced at a regular meeting of the City Council of the City of Newport Beach, held on the 121h day of April 1999, and adopted on the 26`I' day of April 1999, by the following vote to wit: AYES, COUNCILNIEMBERS NOES, COUNCIL MEMBERS ABSTAINED, COUNCIL MEMBERS ABSENT, COUNCIL MEMEBERS ATTEST: CITY CLERK MAYOR NVAIS IISYSUSEM(3SVN/Eldrldge\NIARCH WCo=ci6Fnnchise0sdiec111.doc 4 a EXHIBIT A COMMERCIAL SOLID WASTE COLLECTION FRANCHISE AGREEMENT BETWEEN THE CITY OF • NEWPORT BEACH AND KEVIN RAY DEMOLITION. 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 KEVIN RAY DEMOLITION ( "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. 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. E. 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. _ - _, City has granted to Franchisee a non - exclusive 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 • 1 10 Franchise is subject to the provisions of Article Xlll of the City Charter, Ordinance No. _ 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 Nlav 26. 199 to January 9, 2006, 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 8.5% (eight 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 I% (one percent) per year for each of the next succeeding four 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. (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 2 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. 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 • 3 1� 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. iB. 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 hazardons 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 daring 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. 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) 0 1_� days, Franchisee shall pay to City a delinquent report charge in the amount of One Hundred Dollars (5100). 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. CO-IIIERCIAL 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. 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 5 f'� thousand dollars (5225,000.00) 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. iD. Compliance with this obligation shall not limit Franchisee's indemnification as set forth in Section 11, however, the indemnification provisions of I I 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 (S1,000.00) 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 Scone and Limits of Insurance. eFranchisee shall maintain at least the following minimum insurance coverages: n. 0 I . 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 gencral aggregate limit shall be twice the required occurrence limit. 2. Automobile Liability: 52,000,000 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 0 7 �Q LJ 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 othenvise 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 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. 0 fl 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, defend, 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. 0 0 Ig 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 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. (a) 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 removaUdisposal and for City's costs of storage of the container. Franchisees who are engaged in providing roll -off containers shall maintain a 53,000 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: (l) 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 10 1� 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) 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 le;islative 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. SECTION 17. TERMINATION AND SUSPENSION 11 • r1 L-A R A. The franchise granted to Franchisee may be terminated by the City Council pursuant to Section 12.63.li0 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 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 12 2\ 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. ASSIGNiNIENT 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 L J To Franchisee: Mr. Kevin Ray. Owner Kevin Rav Demolition 580 Explorer Street Brea, CA 92821 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. 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. • 13 aP 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. • 14 --p WITNESS THE EXECUTION OF THIS AGREEMENT ON THE DATE WRITTEN BELOW EACH SIGNATURE: ATTEST LAVONNE M. HARhLESS City Clerk APPROVED AS TO FORM: ROBIN CLAUSON Assistant City Attorney "CITI ' CITY OF NEWPORT BEACH, a Municipal Corporation I: DENNIS D. O'NEIL Mayor DA "FRANCHISEE" 166-vl,-) Ay COMPANY NAM BY: Signa NAME: 1L61llA-) ' (Print) TITLE: ocy"67L DATE: 3 - 16 -4 y 15 11 a`k