HomeMy WebLinkAbout03 - Solid Waste Collection Franchise with Skyline Construction Services Inc., DBA Scor IndustriesCTY OF
F
NEWPORT BEACH
City Council Staff Report
April 14, 2015
Agenda Item No. 3
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Mike Pisani, Acting Municipal Operations Department Director — (949) 644 -3055,
mpisani @newportbeachca.gov
PREPARED BY: Rachell Wilfert, Management Specialist
PHONE: (949) 644 -3010
TITLE: Non- Exclusive Solid Waste Collection Franchise with Skyline Construction Services
Inc., DBA Scor Industries, a California Corporation
ABSTRACT:
The City utilizes a non - exclusive franchise system to manage commercial solid waste collection. This
system helps the City in its efforts to meet Integrated Waste Management Act (AB 939) requirements and
establishes a competitive commercial solid waste collection system for businesses in the City. Staff
recently received an application from Scor Industries, requesting a non - exclusive solid waste collection
franchise.
RECOMMENDATION:
a) Adopt Resolution No. 2015 -24, 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 Skyline Construction Services Inc., d.b.a. Scor Industries, a California Corporation;
b) Direct the City Clerk to publish Resolution No. 2015 -24 within 15 days of its adoption; and
c) Introduce Ordinance No. 2015 -7, An Ordinance of the City Council of the City of Newport Beach
Granting a Non - exclusive Solid Waste Franchise to Skyline Construction Services, Inc., d.b.a. Scor
Industries, a California corporation, to Provide Solid Waste Collection Services Upon the City Streets and
Within the City of Newport Beach, and pass to second reading on April 28, 2015.
FUNDING REQUIREMENTS:
There is no fiscal impact related to this item. Award of the Non - exclusive Franchise would likely to not have
any net financial impact on the City, as any franchise fees paid by this company would be offset by the loss
of fees paid by another hauler.
DISCUSSION:
In the City of Newport Beach, solid waste is collected, recycled, and disposed of by either the City
contractor or commercial solid waste haulers. Currently 75 % of all residential solid waste is collected by
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the City contractor, CR &R, while private haulers collect the remainder of the residential waste stream and
all commercial solid waste, including construction and demolition (C &D) waste.
The City's integrated solid waste management program is structured to ensure the health and safety of all
residents and business owners. In addition, AB 939 requires cities in California to divert 50% of municipal
solid waste from the landfill each year. Since this mandate was initiated in 2000, the City has met the
waste reduction requirements of AB 939. Currently, the City has a 60% State approved diversion level. If
the City fails to achieve the 50% diversion rate, a fine of up to $10,000 can be imposed by the California
Integrated Waste Management Board.
The City utilizes a non - exclusive franchise system to manage commercial solid waste collection. This
system helps the City in its efforts to meet AB 939 requirements and establishes a competitive commercial
solid waste collection system for businesses in the City. Additionally, the franchise system stipulates a
franchise fee in the amount of 16% of gross monthly paid receipts be paid to the City. These funds are
used to fund environmental insurance premiums, maintenance of city infrastructure, and administrative
costs tied to managing the franchise system.
There are currently 32 solid waste franchisees operating under separate agreements to collect and
transport solid waste generated within the City limits. There is no limit on the number of franchises that
Council may approve. This policy permits competitive, service- oriented refuse operations. 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. Pursuant to Section 12.63.080 (Required Findings), City Council shall approve or
conditionally approve an application for a franchise if, on the basis of the application, information, materials,
and testimony submitted, the City Council finds that:
• the application complies with this chapter;
• the applicant or any person responsible for the management of the entity submitting the application has
not within the past three years had (1) a franchise for commercial solid waste handling services terminated
by the City, and /or (2) operated a solid waste enterprise within the City without a franchise;
• awarding the franchise is in accord with the objectives of this chapter;
• granting of such franchise will not, under the circumstances of the particular case, materially affect
adversely the health or safety of persons residing or working in the City or be materially detrimental to the
public welfare or injurious to property or public improvements; and
• the applicant has sufficient experience, equipment, or recycling plan to safely comply with the
requirements of the franchise agreement.
Staff recently received a franchise application from Skyline Construction Services, Inc. d.b.a. Scor
Industries. The application submitted by Scor Industries meets the minimum City qualifications per Section
12.63.050 (Application for a Franchise) of the Municipal Code. Based upon staffs review, Scor Industries
meets all of the criteria required by Section 12.63.080.
Scor Industries was created in 2013 by Skyline Constructions Services, Inc. Scor Industries operates a
medium volume Construction and Demolition /Inert Debris Processing Facility in Rialto. Scor Industries is a
fully integrated construction site waste management firm with advanced diversion programs and
construction debris processing facilities. The site is permitted by the County of San Bernardino, Division of
Environmental Health.
The Resolution of Intention will be published in the City's official newspaper within 15 days after its
adoption and at least 10 days prior to the Public Hearing to award the Franchise.
Pending completion of the Public Hearing and Council approval on April 28, 2015, the franchise with
Skyline Constructions Services, Inc. d.b.a. Scor Industries will take effect May 29, 2015. The franchise will
expire on March 1, 2017 at the end of the City's ten -year franchise term that began in 2007.
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ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this project exempt from the California Environmental Quality Act
( "CEQA ") pursuant to Section 15301 15308 (This Ordinance and Resolution does not change nor expand
existing solid waste operations and facilities with in the City.) of the CEQA Guidelines, California Code of
Regulations, Title 14, Chapter 3, because it has no potential to have a significant effect on the environment.
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:
Description
Attachment A - Resolution
Attachment B - Ordinance
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ATTACHMENT A
RESOLUTION NO. 2015 -_
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 SKYLINE CONSTRUCTION SERVICES, INC. D.B.A SCOR
INDUSTRIES, A CALIFORNIA CORPORATION
WHEREAS, the City Council finds and determines that the collection of solid
waste generated 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, Skyline Construction Services, Inc. d.b.a. Scor Industries, a
California corporation, has submitted an application requesting a Non - exclusive Solid
Waste Franchise that satisfies the City's application requirements.
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NOW, THEREFORE, be it resolved by the City Council of the City of Newport
Beach that:
1. Pursuant to Section 12.63.080 of the Municipal Code City Council shall approve
or conditionally approve an application for a franchise if, on the basis of the
application, information, materials, and testimony submitted, the City Council
finds that:
a. the application complies with this chapter;
b. that the applicant or any person responsible for the management of the entity
submitting the application has not within the past three years had (1) a
franchise for commercial solid waste handling services terminated by the City,
and /or (2) operated a solid waste enterprise within the City without a
franchise;
c. that awarding the franchise is in accord with the objectives of this chapter;
d. that granting of such franchise will not, under the circumstances of the
particular case, materially affect adversely the health or safety of persons
residing or working in the City or be materially detrimental to the public
welfare or injurious to property or public improvements;
e. and that the applicant has sufficient experience, equipment or recycling plan
to safely comply with the requirements of the franchise agreement.
2. A public hearing shall be conducted on April 28, 2015 at 7:00 p.m., or as soon
thereafter as practical in the City Council Chambers, 100 Civic Center Dr,
Newport Beach, California, to consider the granting of a franchise to the applicant
listed under Item 2 below pursuant to the following terms and conditions:
a. Franchise effective date: May 29, 2015.
b. Franchise fee: 16% of gross monthly receipts.
C. A portion of the Franchise fee, 5.5 %, shall be earmarked for the purposes
of indemnifying and holding the City harmless from environmental liability
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associated with the Franchisee's operations in the City. This portion of the
Franchise fee shall be paid into the City's Environmental Liability Fund.
d. Term of Franchise: May 29, 2015 to March 1, 2017 with renewal rights
upon mutual agreement of the franchisee and City.
e. The City shall not set the Franchisee's bin rates.
f. 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, ordinance or applicable law.
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.
I. 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.
3. The City proposes to offer a non - exclusive solid waste collection franchise to the
following applicant listed below that are presently licensed and permitted to
conduct business in the City. Persons who have an interest in or objection to the
proposed franchise may appear before the City Council and be heard on the date
and time listed above.
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a. Skyline Construction Services, Inc. d.b.a. Scor Industries, a California
Corporation
4. This Resolution of Intention shall be published in the City's official newspaper
within 15 days of its adoption and at least 10 days prior to April 28, 2015.
U421*11
CITY CLERK
ADOPTED this 141h day of April, 2015.
9!
MAYOR
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ATTACHMENT B
ORDINANCE NO. 2015 -
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
NEWPORT BEACH GRANTING A NONEXCLUSIVE SOLID
WASTE FRANCHISE TO SKYLINE CONSTRUCTION SERVICES, INC. D.B.A. SCOR
INDUSTRIES, A CALIFORNIA CORPORATION
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 49524 of
the Public Resources Code authorize the City to enter into nonexclusive franchise
agreements for commercial solid waste handling services with private solid waste
enterprises.
B. The City Charter and Chapter 12.63 of the Newport Beach
Municipal Code establish requirements and procedures to grant a franchise to provide
solid waste handling services within the City of Newport Beach.
C. Pursuant to Section 12.63.080 of the Newport Beach Municipal Code,
City Council shall approve or conditionally approve an application for a franchise if, on
the basis of the application, information, materials, and testimony submitted, the City
Council finds that:
• the application complies with this chapter;
• that the applicant or any person responsible for the management of the
entity submitting the application has not within the past three years had
(1) a franchise for commercial solid waste handling services terminated
by the City, and /or (2) operated a solid waste enterprise within the City
without a franchise;
• that awarding the franchise is in accord with the objectives of this
chapter;
that granting of such franchise will not, under the circumstances of the
particular case, materially affect adversely the health or safety of
persons residing or working in the City or be materially detrimental to
the public welfare or injurious to property or public improvements;
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• and that the applicant has sufficient experience, equipment or recycling
plan to safely comply with the requirements of the franchise
agreement.
D. In compliance with the City Charter, a duly noticed public hearing
was held on April 28, 2015, to consider the granting of a franchise to Scor Industries.
E. Having considered all oral and documentary evidence presented at
the public hearing, the City Council has determined that the granting of a nonexclusive
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 the Newport Beach Municipal Code.
SECTION 3: Franchise Agreements
A. Grant of Franchise
There is hereby granted to the enterprise listed below (hereinafter,
"Franchisee ") a nonexclusive 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) Scor Industries, a California corporation
B. Nonexclusive Grant
The right to use City streets, alleys, public ways and places for the
purposes set forth in this Ordinance, shall not be exclusive and the City reserves the
right to grant a similar use of streets, alleys, public ways and places to any person at
any time during the term of this franchise.
C. Term of Franchise
The term of the franchise as set forth in Section 2 of the Franchise
Agreement ( "Agreement') attached hereto as Exhibit A, Commercial Solid Waste
Collection Nonexclusive Franchise Agreement Between the City of Newport Beach and
Scor Industries is hereby adopted, approved and incorporated into this Ordinance by
reference, shall commence on May 29, 2015, and expire on March 1, 2017. The
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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
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.
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. Fees shall total sixteen percent (16 %) of
Franchisee's gross receipts as follows:
(1) Franchisee shall pay to the City ten and one -half percent (10.5 %) of
the Franchisee's gross receipts, of which one -half of one percent (0.5 %) 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 five
and one -half percent (5.5 %) of Franchisee's gross receipts. Payment shall be made
concurrently with the payment of the franchise fee and the filing of reports specified in
Sections 4 and 7 of the Agreement.
E. Inclusion of Franchise Documents
Franchisee shall comply with and shall be bound by all of the terms,
provisions and conditions contained in the City Charter, this Ordinance, Chapter 12.63
of the Newport Beach Municipal Code and the Franchise Agreement.
SECTION 4: Effective Date
This Ordinance shall become effective 30 days from and after the date of
its adoption; provided, however, franchises granted by this Ordinance shall not become
effective unless and until the grantee files written acceptance of the franchise with the
City Clerk, and delivers to the City all bonds and insurance policies required to be
furnished in accordance with the requirements of Chapter 12.63 of the Newport Beach
Cl
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Municipal Code and the Franchise Agreement. The written acceptance shall be in form
and substance as prescribed by the City Attorney and shall operate as an acceptance of
each and every term, condition and limitation contained in this Ordinance, the Franchise
Agreement, Article XIII of the City Charter, and Chapter 12.63 of the Newport Beach
Municipal Code. The grantee shall file written acceptance of the franchise no later than
ten (10) days after the adoption of this Ordinance.
SECTION 5: CEQA Exemption
The City Council of the City of Newport Beach finds that this Ordinance is
categorically exempt under the California Code of Regulations Section 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).
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, irrespective of the fact that any one or more
sections, subsections, sentences, clauses, or phrases be declared unconstitutional.
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SECTION 7: Adoption of Ordinance
The Mayor shall sign and the City Clerk shall attest to the passage of this
Ordinance. The City Clerk shall cause the same to be published once in the official
newspaper within fifteen (15) 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 14th day
of April, 2015, and adopted on the 28th day of April 2015 by the following vote to wit:
AYES, COUNCIL MEMBERS
NOES, COUNCIL MEMBERS
ABSTAINED, COUNCIL MEMBERS
ABSENT, COUNCIL MEMBERS
ITATTIVIESIZ
ATTEST:
CITY CLERK
Approved to as Form:
Office of the City Attorney:
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Aaron C. Harp
City Attorney
Exhibits: A. Commercial Solid Waste Collection Nonexclusive Franchise
Agreement Between the City of Newport Beach and Skyline
Construction Services, Inc. d.b.a. Scor Industries, a California
Corporation
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COMMERCIAL SOLID WASTE COLLECTION
NONEXCLUSIVE FRANCHISE AGREEMENT BETWEEN THE CITY OF
NEWPORT BEACH AND SKYLINE CONSTRUCTION SERVICES, INC. DBA SCOR
INDUSTRIES, A CALIFORNIA CORPORATION
This Nonexclusive Franchise Agreement for Commercial Solid Waste Handling
Services ( "Agreement') is entered into this 14th day of April, 2015 ( "Effective Date ") by
and between the CITY OF NEWPORT BEACH, a California municipal corporation and
Charter City organized and existing under the laws of the State of California ( "City "),
and SKYLINE CONSTRUCTION SERVICES, INC. DBA SCOR INDUSTRIES, a
California corporation ( "Franchisee'), whose address is 2321 S. Willow Avenue,
Bloomington, California 92316 and is made with reference to the following:
RECITALS
This Agreement is entered into on the basis of the following facts:
A. Franchisee has provided or is capable of providing commercial solid waste
collection services in the City.
B. Pursuant to Article XIII of the City Charter, Chapter 12.63 of the City of
Newport Beach Municipal Code ( "Code'), and Sections 49300 and 49500 -49523 of the
Public Resources Code, the City is authorized to enter into nonexclusive franchise
agreements for commercial solid waste handling services.
C. Pursuant to this Agreement, City desires to authorize Franchisee to
provide nonexclusive commercial solid waste handling services within the City.
Franchisee shall furnish all personnel, equipment, and supplies necessary to collect,
transport, or otherwise remove and dispose of solid waste and recyclable materials from
commercial, institutional, or industrial premises within the City.
D. The City Council has determined that the grant of a nonexclusive
franchise is in the public interest.
NOW, THEREFORE, CITY AND FRANCHISEE DO HEREBY AGREE AS
FOLLOWS:
SECTION 1. GRANT OF FRANCHISE
A. By Ordinance No. 2015 -_, City has granted to Franchisee a
nonexclusive franchise authorizing Franchisee to provide commercial solid waste
handling services for solid waste kept, accumulated, or generated in the City of Newport
Beach and to use the public streets and public right -of -ways for such purpose
( "Franchise "). Franchisee acknowledges that the Franchise is not exclusive and that
the Franchise is subject to the provisions of Article XIII of the City Charter, Ordinance
No. 2015-_, Chapter 12.63 of the Code, and the terms and conditions of this
Agreement.
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B. Upon the Effective Date of this Agreement, the parties agree that any prior
authorization relating to the conduct of commercial solid waste handling services in the
City arising under and pursuant to any prior franchise issued to Franchisee shall be
deemed to be terminated and of no further force or effect.
SECTION 2. TERM OF FRANCHISE
The term of this Agreement shall commence on the Effective Date, and shall
terminate on the 1st day of March, 2017 ( "Termination Date "), unless terminated earlier
as set forth herein ( "Term ").
SECTION 3. DEFINITIONS
Unless otherwise defined herein, or if the use or context clearly requires a
different definition, all words, terms and phrases in this Agreement and the derivations
thereof shall have the meanings set forth in Section 12.63.020 of the Code.
SECTION 4. FRANCHISE FEES
A. During the Term of the Franchise, Franchisee shall pay to City franchise
fees for the privilege of providing commercial solid waste handling services in the City of
Newport Beach and for the use of public streets, right -of -ways and places for such
purposes. The franchise fee that Franchisee shall pay to the City shall be ten and a half
percent (10.5 %) of the gross receipts for all commercial solid waste handling services
provided by the Franchisee in the City of Newport Beach ( "Franchise Fees "). One half
percent (.5 %) of the Franchise Fee shall be attributable to the maintenance and
implementation of the City's Source Reduction and Recycling Element ( "SRRE "), and
shall be separately accounted for, and used only for the costs stated in Public
Resources Code section 41901 or any successor provision.
B Franchise Fees shall be paid quarterly on forms prescribed by the Finance
Director.
C. Franchisee shall pay all required Franchise Fees to:
City of Newport Beach
Attn: Finance Director
P.O. Box 1768
100 Civic Center Drive
Newport Beach, CA 92660
D. Franchise Fees shall be due and payable on the thirtieth (30th) day of the
month following the end of each quarter. Since the Effective Date for this Agreement is
starting in the end of a quarter, the first payment of the Franchise Fees due and payable
to the City from the Effective Date to the end of the first quarter (i.e. June 30, 2013) will
be due and payable on the 30th day of July 2013.
Nonexclusive Franchise Agreement Page 2
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E. The parties hereto agree that Franchisee's failure to make Franchise Fee
and Environmental Liability Fund Fee payments, as set forth in Section 8 (hereinafter
the Franchise Fee and Environmental Liability Fund Fee shall collectively be referred to
as "Fee(s) "), within the time allowed will result in damages being sustained by City.
Such damages are, and will continue to be, impracticable and extremely difficult to
determine. If Fees are not paid by Franchisee when due then in addition to the Fees,
Franchisee shall pay a late charge in an amount equal to ten percent (10 %) of the
amount of the Fee that was not timely paid by Franchisee. If Franchisee fails to pay
delinquent Fees within thirty (30) days of the date due, Franchisee shall pay a second
(2 "d) late charge in an amount equal ten percent (10 %) on both the amount of the Fee
outstanding and the first late charge. The second (2"d) late charge shall be in addition
to the first (1st) late charge. Execution of this Agreement shall constitute agreement by
the parties that the late charges set forth in this subsection is the minimum value of the
costs and actual damages caused by the failure of the Franchisee to pay the Fees
within the allotted time. Such sum is liquidated damages and shall not be construed as
a penalty.
In addition to the late charges imposed on Franchisee for failing to pay
Fees in accordance with this Agreement, Franchisee shall pay interest on the amount of
Fees and late charges due and owing at the rate of one and one -half percent (1'/2 %)
per month for each month or portion of a month that the Fees and late charges remain
unpaid.
F. In the event Franchisee believes that it has paid Fees in excess of the
Fees due to City, Franchisee may submit a request for refund to the Finance Director on
a form provided by the Director. If proof of overpayment is satisfactory to the Director,
the Director shall refund to Franchisee any overpayment. Franchisee shall not apply
any overpayment as a credit against any other amounts payable to City unless
specifically authorized by the Finance Director in writing.
G. Each Franchise Fee payment shall be accompanied by a written
statement described in Section 12.63.090 of the Code on a form provided by the
Finance Director. No statement filed under this Section shall be conclusive as to the
matters set forth in such statement, nor shall the filing of such statement preclude the
City from collecting by appropriate action the sum that is actually due and payable.
H. Franchisee may separately list the actual Franchise Fee rate and
Environmental Liability Fund Fee rate as established by this Section, and any other fees
required by this Agreement, on its invoices to its customers. In no case may the
Franchise Fee rate or Environmental Liability Fund Fee rate listed by the Franchisee on
the invoice exceed the actual Franchise Fee or Environmental Liability Fund Fee rates
imposed by the City.
SECTION 5. CASH DEPOSIT
Franchisee shall, prior to the placement of any commercial solid waste container
on public property, provide City with a cash deposit in the sum of Five Thousand Dollars
and no /100 ($5,000.00) to ensure compliance with the duties and obligations imposed
Nonexclusive Franchise Agreement Page 3
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by the provisions of the Code, regulations adopted by the City Manager or his designee
and this Agreement.
SECTION 6. DISPOSAL OF SOLID WASTE
A. Franchisee shall comply with all recycling and diversion requirements
imposed by law, ordinance, or regulation on the City and /or Franchisee. On a quarterly
basis Franchisee shall divert solid waste collected from landfills as follows: Year 1: fifty
percent (50 %); Year 2: fifty -one percent (51 %); Year 3: fifty -two percent (52 %); Year 4:
fifty -three percent (53 %); Year 5: fifty -four percent (54 %); Years 6 -10: fifty -five percent
(55 %). In no event shall Franchisee deposit more solid waste at any landfill during any
calendar quarter than the required diversion rate mandated by the City. In the event
new or additional diversion requirements are imposed by law, ordinance or regulation
on City and /or Franchisee, the City shall have the right to require Franchisee to divert
additional solid waste from landfills by providing Franchisee with ten (10) days written
notice of the new diversion requirements. Upon request of the Municipal Operations
Director, Franchisee shall provide all documents and information requested by the
Municipal Operations Director to prove that Franchisee has complied with this
subsection, any applicable law, ordinance, regulation, or condition related to recycling
and diversion of solid waste.
B. Franchisee shall dispose of solid waste collected or transported by
Franchisee only by taking such solid waste to an Orange County certified /licensed
landfill, State certified /licensed transfer station, State certified /licensed recycling facility
or State certified /licensed materials recovery facility which is lawfully authorized to
accept that specific type of solid waste material. Franchisee shall not dispose of solid
waste by depositing it on any land, (except a permitted facility) whether public or private,
or in any river, stream or other waterway, or in any sanitary sewer or storm drainage
system. Nothing in this Agreement shall be deemed or construed as authorizing
Franchisee to operate a landfill, recycling center, or other solid waste disposal facility.
C. All solid waste, in addition to recyclables, collected by Franchisee shall
become the property of Franchisee upon placement by the customer for collection. If
Franchisee violates the terms in Section 6(A) and Section 6(B) above, Franchisee
agrees that the City has the future right to direct that solid waste be delivered to a
permitted disposal facility designated by City. This exercise of "flow control" by the City
shall be made upon at least 30 days prior written notice to Franchisee, and written
notice shall include the violation(s) prompting the City's action regarding "flow control."
Failure to comply with the recycling /diversion requirements and delivery/disposal of
materials in accordance to the designated certified /licensed facility shall be a material
breach of this agreement.
D. Franchisee shall include as a condition to its contractual agreement with
its customers a provision prohibiting disposal of hazardous waste in any of Franchisees
vehicles or disposal bins /containers, and other equipment.
E. Franchisee shall implement a load check program that includes, at a
minimum, a visual check of all containers to be emptied to protect against inclusion of
Nonexclusive Franchise Agreement Page 4
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hazardous waste and shall prepare a written record of all hazardous waste discovered
during the process. The records shall comply with all State and Federal Hazardous
Waste Regulations, shall be maintained for the length of the term of the Franchise, and
shall be made available to the City upon request.
SECTION 7. REPORTS
A. Franchisee shall submit to City monthly reports stating the total amount (in
tons) of solid waste which Franchisee collected in the City of Newport Beach during the
reportable month; the total weight (in tons) of solid waste disposed of by Franchisee at
landfills and transfer stations which Franchisee collected in the City of Newport Beach
during the reportable month; the total weight and the weight by material category (in
tons) of solid waste disposed of by Franchisee at recycling and materials recovery
facilities during the reportable month which Franchisee collected in the City of Newport
Beach; the name and location of all solid waste and recycling facilities where City of
Newport Beach materials were delivered; such other tonnage or other information as
requested by the Municipal Operations Director including weigh tickets, recycling
records; and any complaints received by the Franchisee. Such monthly reports shall be
prepared on such form as required by the Municipal Operations Director. Each monthly
report shall be submitted on or before the 15th day of the month following the end of the
month (i.e. report due April 15 for first month after the Effective Date) and submitted to:
Deputy Municipal Operations Director
City of Newport Beach
P.O. Box 1768
100 Civic Center Drive
Newport Beach, CA 92660
B. If the report required under Subsection A is not filed by the due date
specified above, the report shall be deemed delinquent. If the report remains delinquent
for more than fifteen (15) days, Franchisee shall pay to City a delinquent report charge
in the amount of One Hundred Dollars and no /100 ($100.00). 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 and no /100 ($500.00). Such
delinquent report charges shall be in addition to any Franchise Fees or other charges
payable by Franchisee under this Agreement.
C. Franchisee shall comply with all recycling and diversion requirements
imposed by law, ordinance, or regulation on the City. Monthly reports stating the total
amount (in tons) of solid waste which Franchisee landfilled, recycled and collected
should accurately reflect the diversion rate required by the City (Year 1- 50 %, Year 2-
51 %, Year 3- 52 %, Year 4- 53 %, Year 5- 54 %, Years 6 -10- 55 %). At the end of each
quarter, monthly reports will be evaluated for compliance with City diversion
requirements. Failure to comply with the recycling and diversion requirements shall be
a material breach of this Agreement.
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SECTION 8. ENVIRONMENTAL LIABILITY FUND FEE
A. City and Franchisee acknowledge the potential liability which can result
from commercial solid waste handling services under Federal and State environmental
laws. City intends to take reasonable actions to obtain protection and indemnification
against future environmental liability for solid waste generated within the City of Newport
Beach and the activities of Franchisee under this Agreement for handling such solid
waste. To provide protection and indemnification to City for Franchisee's solid waste
handling activities in the City of Newport Beach, Franchisee agrees to collect from its
customers a fee for payment into an Environmental Liability Fund which shall be a
separate Fund established and maintained by City. The Fund shall be used to purchase
insurance which will insure the City against environmental liability which may be
imposed upon City as a result of Franchisee's activities under this Franchise and /or
shall be used to pay environmental liability costs and expenses arising from or related in
any way to commercial solid waste handling services. The Fund shall not be
commingled with or included in the City's General Fund.
B. The fee that Franchisee shall pay to the City Environmental Liability Fund
shall be five and a half percent (5.5 %) of the gross receipts for all commercial solid
waste handling services provided by the Franchisee in the City of Newport Beach
( "Environmental Liability Fund Fee(s) "). Payment of the Environmental Liability Fund
Fee shall be made concurrently with the payment of the Franchise Fees specified in
Section 4 of this Agreement. Franchisee agrees to pay late charges and interest as
provided in Section 4(E) of this Agreement if Franchisee fails to pay the Environmental
Liability Fund Fee within the time frames set forth herein.
C. Compliance with this obligation shall not limit Franchisee's indemnification
as set forth in Section 11; however, the indemnification provisions of 11(C) shall be
secondary to the Fund established by this Section or any insurance purchased with the
funds provided.
SECTION 9. FRANCHISEE'S RECORDS
A. Franchisee shall keep and maintain books of account, income statements,
tonnage reports and supporting documents and all other documents that relate in any
way to business transactions conducted by Franchisee in connection with the
commercial solid waste handling services of Franchisee under this Agreement during
the Term of this Agreement and for a minimum period of three (3) years, or for any
longer period required by law, after the Termination Date. Such records shall be kept at
Franchisee's place of business and shall be clearly identifiable
B. Franchisee shall allow a representative of City to examine, audit and make
transcripts or copies of the books of account, income statements, tonnage reports and
supporting documents, and all other documents that relate in any way to business
transactions conducted by Franchisee in connection with the commercial solid waste
handling services of Franchisee under this Agreement at Franchisee's place of business
during normal business hours within three (3) working days of the City Manager, or his
designees request or demand to inspect and /or audit these records. The purpose of
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such inspection and /or audit shall be for verification of the Fees paid by Franchisee
under this Agreement, and the accuracy thereof; and for verification of the amounts of
solid waste reported by Franchisee pursuant to this Agreement. Franchisee's books of
account, income statements, tonnage reports and other documents accessed by City
shall be kept confidential unless these documents are deemed necessary by City to
enforce the terms of this Agreement or are required to be produced pursuant to any
applicable law.
C. The parties agree that Franchisee's failure to provide its records in
accordance with City's request to examine, audit and make transcripts or copies of the
books of account, income statements, tonnage reports and supporting documents in
accordance with Subsection B above, shall be considered a material breach of this
Agreement and will result in damages being sustained by City. Such damages are, and
will continue to be, impracticable and extremely difficult to determine. The parties agree
that if Franchisee fails to provide its records in accordance with Subsection B above, the
City may, in its discretion terminate this Agreement and /or charge a late charge in the
amount of Two Hundred Fifty and No /100 Dollars ($250.00) for each working day that
Franchisee does not provide said records. Execution of this Agreement shall constitute
agreement by the parties that the late charge set forth in this subsection is the minimum
value of the costs and actual damages caused by the failure of the Franchisee to
provide records in accordance with Subsection B above. Such sum is liquidated
damages and shall not be construed as a penalty.
D. Franchisee shall reimburse City for City's costs in performance of an audit
if, as a result of the audit it is determined:
1. There was any intentional misrepresentation by Franchisee with
respect to the amount of Fees due to the City; or
2. There is a one thousand dollars ($1,000.00) or greater discrepancy
in the amount of Fees due to the City.
Such reimbursement shall be paid by Franchisee within thirty (30) days of the
date City notifies Franchisee in writing that the Franchisee is liable to reimburse the City
in conformance with this subsection and the amount of City's audit costs.
E. If Franchisee refuses to provide City's auditor with its records as required
by Subsection B above or disagrees with City's audit findings, then Franchisee may,
within ten (10) days after written request by City's designated representative for records
disclosure, or within ten (10) days after service of the audit finding, appeal the
imposition of late charge or the audit findings by filing a written appeal with the City
Council specifying the basis of Franchisee's failure to provide records, or the reason for
its disagreement with City's audit findings. If Franchisee fails to timely request such an
appeal to the City Council, then the late charges and /or discrepancy determinations
shall be final and conclusive and the amounts shall become immediately due and
payable and /or the violation shall be deemed established.
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SECTION 10. INSURANCE REQUIREMENTS
A. Provision of Insurance. Without limiting Franchisee's indemnification of
City, and prior to commencement of Work, Franchisee shall obtain, provide and
maintain at its own expense during the term of this Agreement, policies of insurance of
the type and amounts described below and in a form satisfactory to City. Franchisee
agrees to provide insurance in accordance with requirements set forth here. If
Franchisee uses existing coverage to comply and that coverage does not meet these
requirements, Franchisee agrees to amend, supplement or endorse the existing
coverage.
B. Acceptable Insurers. All insurance policies shall be issued by an
insurance company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders' Rating
of A- (or higher) and Financial Size Category Class VII (or larger) in accordance with the
latest edition of Best's Key Rating Guide, unless otherwise approved by the City's Risk
Manager.
C. Coverage Requirements.
1. Workers' Compensation Insurance. Franchisee shall maintain
Workers' Compensation Insurance, statutory limits, and Employer's Liability Insurance
with limits of at least one million dollars ($1,000,000) each accident for bodily injury by
accident and each employee for bodily injury by disease in accordance with the laws of
the State of California, Section 3700 of the Labor Code.
Franchisee shall submit to City, along with the certificate of
insurance, a Waiver of Subrogation endorsement in favor of City, its officers, officials,
employees and agents.
2. General Liability Insurance. Franchisee shall maintain commercial
general liability insurance, and if necessary umbrella liability insurance, with coverage at
least as broad as provided by Insurance Services Office form CG 00 01, in an amount
not less than one million dollars ($1,000,000) per occurrence, two million dollars
($2,000,000) general aggregate and two million dollars ($2,000,000) completed
operations aggregate. The policy shall cover liability arising from premises, operations,
products - completed operations, personal and advertising injury, and liability assumed
under an insured contract (including the tort liability of another assumed in a business
contract) with no endorsement or modification limiting the scope of coverage for liability
assumed under a contract.
3. Automobile Liability Insurance. Franchisee shall maintain
automobile insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of the Franchisee arising out
of or in connection with Work to be performed under this Agreement, including coverage
for any owned, hired, non -owned or rented vehicles, in an amount not less than one
million dollars ($1,000,000) combined single limit for each accident.
D. Other Insurance Requirements. The policies are to contain, or be
endorsed to contain, the following provisions:
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1. Waiver of Subrogation. All insurance coverage maintained or
procured pursuant to this agreement shall be endorsed to waive subrogation against
City, its elected or appointed officers, agents, officials, employees and volunteers or
shall specifically allow Franchisee or others providing insurance evidence in compliance
with these requirements to waive their right of recovery prior to a loss. Franchisee
hereby waives its own right of recovery against City, and shall require similar written
express waivers from each of its subcontractors.
2. Additional Insured Status. All liability policies including general
liability, excess liability, pollution liability, and automobile liability, but not including
professional liability (if required), shall provide or be endorsed to provide that City and
its officers, officials, employees, and agents shall be included as insureds under such
policies.
3. Primary and Non Contributory. All liability coverage shall apply on
a primary basis and shall not require contribution from any insurance or self- insurance
maintained by City.
4. Notice of Cancellation. All policies shall provide City with thirty (30)
days notice of cancellation (except for nonpayment for which ten (10) days notice is
required) or nonrenewal of coverage for each required coverage.
E. Additional Agreements Between the Parties. The parties hereby agree to
the following:
1. Evidence of Insurance. Franchisee shall provide certificates of
insurance to City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation and other endorsements
as specified herein for each coverage. Insurance certificates and endorsement must be
approved by City's Risk Manager prior to commencement of performance. Current
certification of insurance shall be kept on file with City at all times during the term of this
contract. City reserves the right to require complete, certified copies of all required
insurance policies, at any time.
2. City's Right to Revise Requirements. The City reserves the right at
any time during the term of this Agreement to change the amounts and types of
insurance required by giving the Franchisee ninety (90) days advance written notice of
such change.
3. Right to Review Subcontracts. Franchisee agrees that upon
request, all contracts with subcontractors or others with whom Franchisee enters into
contracts with on behalf of City will be submitted to City for review. Failure of City to
request copies of such contracts will not impose any liability on City, or its employees.
4. Enforcement of Contract Provisions. Franchisee acknowledges and
agrees that any actual or alleged failure on the part of the City to inform Franchisee of
non - compliance with any requirement imposes no additional obligations on the City nor
does it waive any rights hereunder.
5. Requirements not Limiting. Requirements of specific coverage
features or limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided by any
insurance. Specific reference to a given coverage feature is for purposes of clarification
Nonexclusive Franchise Agreement Page 9
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only as it pertains to a given issue and is not intended by any party or insured to be all
inclusive, or to the exclusion of other coverage, or a waiver of any type.
6. Self- insured Retentions. Any self- insured retentions must be
declared to and approved by City. City reserves the right to require that self- insured
retentions be eliminated, lowered, or replaced by a deductible. Self- insurance will not be
considered to comply with these requirements unless approved by City.
7. City Remedies for Non Compliance If Franchisee or any
subcontractor fails to provide and maintain insurance as required herein, then City shall
have the right but not the obligation, to purchase such insurance, to terminate this
agreement, or to suspend Franchisee's right to proceed until proper evidence of
insurance is provided. Any amounts paid by City shall, at City's sole option, be
deducted from amounts payable to Franchisee or reimbursed by Franchisee upon
demand.
8. Timely Notice of Claims. Franchisee shall give City prompt and
timely notice of claims made or suits instituted that arise out of or result from
Franchisee's performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies. City assumes no obligation or
liability by such notice, but has the right (but not the duty) to monitor the handling of any
such claim or claims if they are likely to involve City.
9. Franchisee's Insurance. Franchisee shall also procure and
maintain, at its own cost and expense, any additional kinds of insurance, which in its
own judgment may be necessary for its proper protection and prosecution of the Work.
SECTION 11. RESPONSIBILITY FOR DAMAGES AND INJURY /INDEMNIFICATION
A. Franchisee Responsibility. Franchisee shall be responsible for any
damages caused as a result of Franchisees acts or omissions including, but not limited
to injuries to or death of any person or damage to public and /or private property and
damages public improvements as a result of Franchisees placement and retrieval of the
commercial solid waste containers.
B. General Indemnification. Franchisee shall indemnify, hold harmless, and
defend City, and each of its past, present and future elected officials, officers,
employees, agents, consultants, volunteers, affiliates, assignees, representatives,
attorneys, subsidiaries, and affiliated entities and their respective successors, heirs and
assigns (collectively, "Indemnified Parties ") harmless for, from and against any costs,
expenses, damages, and losses, including actual attorneys fees ( "Losses ") of any kind
or character to any person or property arising directly or indirectly from or caused by
any of the following: (i) any act or omission of Franchisee or its respective officers,
directors, shareholder members, partners, employees, agents, Franchisees,
subcontractors, suppliers, representatives and affiliates ( "Franchisee Representatives ");
(ii) Franchisee's or Franchisee Representative's activities; (iii) any accident or casualty
within or arising out of the Services performed under the Franchise and /or this
Agreement; (iv) any violation or alleged violation of any law, ordinance or statute now or
hereafter enacted arising out of Services performed pursuant to the Franchise and /or
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this Agreement; (v) the negligence or willful misconduct of Franchisee or any of
Franchisee representatives in the performance of the Services under the Franchise
and /or this Agreement; and (vi) any breach of the Franchise and /or this Agreement.
Franchisee shall not be required to indemnify, hold harmless and defend the
Indemnified Parties from the sole negligence, active negligence or willful misconduct of
the Indemnified Parties. Nothing in this indemnity shall be construed as authorizing any
award of attorney's fees in any action on or to enforce the terms of this Agreement.
This indemnity shall apply to all claims and liability regardless of whether any insurance
policies are applicable. The policy limits do not act as a limitation upon the amount of
indemnification to be provided by the Franchisee.
C. Hazardous Substances Indemnification. Franchisee shall indemnify the
Indemnified Parties from and against all claims, actual damages including, but not
limited to, special and consequential damages, natural resource damage, punitive
damages, injuries, costs, response, remediation, and removal costs, losses, demands,
debts, liens, liabilities, causes of action, suits, legal or administrative proceedings,
interest, fines, charges, penalties and expenses attorneys' and expert witness fees and
costs incurred in connection with defending against any of the foregoing or in enforcing
this indemnity of any kind whatsoever paid, incurred or suffered by, or asserted against,
the Indemnified Parties or Franchisee arising directly or indirectly from or caused by any
of the following: (i) the violation of any Environmental Laws or the failure to clean up and
mitigate the consequences of the spill or release of any Hazardous Substance; and (ii)
Franchisee's activities under this Agreement concerning any Hazardous Substance at
any place where Franchisee stores or disposes of solid or hazardous waste pursuant to
this Agreement, or preceding Agreements between City and Franchisee. The foregoing
indemnity is intended to operate as an agreement pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act 42. U.S.C. Section 9607(e)
and any amendments thereto; California Health and Safety Code Section 25364, to
insure, protect, hold harmless, and indemnify City from liability.
As used herein, the term "Environmental Laws" shall mean "any and all present
and future federal, state or local laws (whether common law, statute, rule, regulation or
otherwise), permits, orders and any other requirements of Governmental Authorities
relating to the environment or any "Hazardous Substance" or "Hazardous Substance
Activity" (as defined herein) (including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. §§ 9601
et seq.) as amended from time to time and the applicable provisions of the California
Health and Safety Code and California Water Code).
As used herein, the term "Hazardous Substance" shall mean "any (a) chemical,
compound, material, mixture or substance that is now or hereinafter defined or listed in,
or otherwise classified pursuant to any Environmental Law as a "hazardous substance ",
"hazardous material," "hazardous waste," "extremely hazardous waste," "infectious
waste," "toxic waste," "toxic pollutant," or any other formulation intended to define, list or
classify substances by reason of deleterious properties or affect and (b) petroleum,
petroleum by- products, natural gas, natural gas liquids, liquefied natural gas, synthetic
gas usable for fuel (or mixtures of natural gas in such synthetic gas), ash, municipal
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solid waste, steam, drilling fluids, produced waters and other wastes associated with the
exploration, development and production of crude oil, natural gas or geothermal
resources."
D. AB939 Indemnification. Franchisee agrees to meet all requirements of
City's Source Reduction and Recycling Element as to the portion of the solid waste
stream handled by Franchisee. Franchisee agrees to protect, defend, indemnify, and
hold City harmless against all fines or penalties imposed by the California Integrated
Waste Management Board, or other entity, arising from the failure of Franchisee to meet
the Integrated Waste Management Act diversion requirements with respect to the
portion of the commercial waste stream collected by Franchisee.
E. Notice. City agrees to give notice to Franchisee when the City receives a
claim for damages or other liability for which Franchisee has provided indemnification
under this Section.
SECTION 12. COMMERCIAL SOLID WASTE COLLECTION SERVICES
A. Frequency of Collection. Franchisee shall collect all solid waste, including
recyclable materials, as authorized in this Agreement, on a schedule to be agreed upon
between the Franchisee and its customers. The schedule shall provide for collection
service at least once per week; provided, however, that such schedule shall not permit
the accumulation of solid waste in quantities that are unreasonable or detrimental to the
public health or safety. Requests for collection from premises with overflowing bins or
containers, or from premises where there have been missed pickups, shall be serviced
within twenty four (24) hours of any such request by the customer or City. If requested
by the City at any time, Franchisee's collection schedule shall be submitted to the City
for its approval.
B. Hours and Days of Collections. No collection of solid waste shall occur in
any area of the City after 6:30 p.m. and prior to 5:00 a.m. No collection of solid waste
from commercial premises within five hundred (500) feet of occupied residential
premises, motels or hotels shall be made by Franchisee, nor shall any of Franchisee's
collection vehicles be operated in any residential areas of the City except between the
hours of 7:00 a.m. and 6:30 p.m., Monday through Friday, nor on any Saturday or
Sunday, except between the hours of 8:00 a.m. and 6:00 p.m. Collection on Sundays
shall be limited to the disposal of commercial waste from commercial premises which
require collection every day due to public health and safety concerns.
SECTION 13. VEHICLES AND EQUIPMENT
A. Any and all containers provided to customers of Franchisee for storage,
collection or transportation of commercial solid wastes shall meet the requirements
designated by the Municipal Operations Director as well as State of California minimum
standards for solid waste handling established under Public Resources Code Section
43020 and applicable health requirements.
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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 must pass the required periodic "BIT"
inspection and Franchisee shall provide evidence of such to the Municipal Operations
Department as requested. Upon request by the City, Franchisee shall provide records
from the most recent California Highway Patrol biennial inspection of the terminal(s)
responsible for the maintenance and repair of equipment used in the City. All vehicles
shall be properly maintained, kept clean and in good repair, and shall be uniformly
painted. All commercial solid waste containers used in the performance of this
Agreement shall be kept clean and in good repair and shall be uniformly painted to the
satisfaction of the Municipal Operations Director. All vehicles and equipment used by
Franchisee in the performance of this Agreement may be subject to inspection by the
City upon twenty -four (24) hours notice by the Municipal Operations Director. All drivers
employed by Franchisee and operating equipment in the City shall be properly licensed
for the class of vehicle they drive, enrolled in the Department of Motor Vehicles
Employee Pull Notice (EPN) program, and abide by all State and federal regulations for
driver hours and alcohol and controlled substances testing.
2. Each vehicle shall be so constructed and used in a manner so that
no rubbish, garbage, debris, oil, grease or other material will blow, fall, or leak out of the
vehicle. All solid waste shall be transported by means of vehicles which are covered in
such a manner as to securely contain all solid waste and to prevent such solid waste
from projecting, blowing, falling or leaking out of the vehicles. Any solid waste dropped
or spilled in collection, transfer or transportation shall be immediately cleaned up by
Franchisee. A broom and a shovel shall be carried at all times on each vehicle for this
purpose. In addition, each collection vehicle shall be equipped with trash bags,
masking tape and notice of non - collection tags for the purpose of separating hazardous
waste for return to the generator. A communications device such as a two -way radio or
a cellular telephone shall also be maintained on each vehicle at all times.
3. Franchisee shall not store any vehicle or equipment on any public
street, public right -of -way or other public property in the City of Newport Beach without
obtaining a Temporary Street Closure Permit from the Public Works Department and
prior written consent of the Municipal Operations Director.
4. Should the Municipal Operations Director at any time give written
notification to Franchisee that any vehicle does not comply with the standards
hereunder, the vehicle shall be promptly removed from service by Franchisee and not
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used again until inspected and authorized in writing by the Municipal Operations
Director.
5. Placement of containers and equipment shall be in accordance with
the standards set by the Director of Public Works and in accordance with the standards
set forth in Exhibit A which is incorporated herein by this reference. Any deviation from
the standards set by the Director of Public Works or the standards set forth in Exhibit A
shall require written approval from the Public Works Director.
SECTION 14. ABANDONED CONTAINERS
A. If Franchisee abandons any commercial solid waste container within the
City of Newport Beach, the City may remove the container and /or dispose of the
contents of the container.
B. If City is required to remove a roll -off or compactor container abandoned
by Franchisee and /or disposes of the contents of any container abandoned by
Franchisee, City may charge Franchisee for City's costs incurred in such
removal /disposal and for City's costs of storage of the container. Franchisees who are
engaged in providing roll -off containers shall maintain a Five Thousand Dollars and No/
100 ($5,000.00) cash deposit with City Revenue Division to reimburse City for such
costs within ten (10) days of the date of City's invoice for such costs.
C. For the purposes of this Section, "abandoned" includes:
1. Franchisee's failure to remove the container within the time period
specified by the City Council upon termination of the Franchise pursuant to Section
12.63.140 of the Code;
2. Franchisee's failure to remove the container within ten (10) working
days after the expiration of the Franchise granted to Franchisee, except in the case
where Franchisee has been granted an extension of the term of said Franchise or
Franchisee has been granted a subsequent franchise authorizing Franchisee to collect
and transport the type or types of solid waste for which the container was used pursuant
to this Agreement.
3. Franchisee's failure to collect the container and dispose of the
contents of the container within five (5) calendar days after City's Director of Municipal
Operations issues written notice to Franchisee to dispose of the contents.
SECTION 15. COMPLIANCE WITH LAW
A. Franchisee shall perform all commercial solid waste handling services in
accordance with applicable federal, state, and local law, including Chapter 12.63 of the
Code, Article XIII of the City Charter, Ordinance No. 2007 -07 and in accordance with
the terms and conditions of this Agreement.
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B. During the Term of this Agreement, Franchisee and City agree that the
City's ordinances may be amended as provided herein, as provided in Chapter 12.63 or
as necessary to permit the City to comply with changes to federal, state, and local
legislative regulatory requirements, which may affect or alter City's solid waste handling
obligations or requirements for solid waste management. Franchisee agrees to comply
with any such amendment of the City's ordinances.
SECTION 16. PERMITS AND LICENSES
Franchisee shall obtain and maintain, at Franchisee's sole cost and expense, all
permits and licenses applicable to Franchisee's operations under the Franchise which
are required of Franchisee by any governmental agency. Payment of Franchise Fees
and Environmental Liability Fund Fees shall be in addition to any permit or license fees
or business tax prescribed by the City for the same period.
Franchisee shall obtain and maintain for the Term of this Agreement an account
with the Orange County landfills. If Franchisee disposes of solid waste at an Orange
County landfill, the Franchisee shall only dispose of Newport Beach solid waste at
Orange County landfills utilizing their account (no "cash only" disposal).
SECTION 17. PUBLIC EDUCATION ACTIVITIES
A. City and Franchisee shall cooperate in co- sponsoring not more than one
promotional event per year, as mutually agreed upon in advance by the parties, which is
related to the implementation of commercial solid waste handling services and recycling
services.
B. Each year during the term of this Agreement, on an annual basis,
Franchise shall transmit promotional brochures or fliers to its customers and to such
prospective customers as it may select, informing them of the commercial solid waste
handling services and recycling services which are provided by the Franchisee as well
as hazardous waste disposal requirements.
C. All promotional brochures, fliers or other information distributed by
Franchisee hereunder shall be printed on recycled paper. All such informational
materials shall be approved in advance by the City's Municipal Operations Director.
SECTION 18. TERMINATION AND SUSPENSION
A. The franchise granted to Franchisee may be terminated by the City
Council pursuant to Section 12.63.140 of the Code.
B. In the event the Franchise is terminated pursuant to Subsection A above
or the term of this Agreement expires:
1. Franchisee shall have no right or authority to engage in commercial
solid waste handling operations in the City of Newport Beach, subject to the provisions
of Sections 49520 -49523 of the Public Resources Code.
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2. Franchisee shall, however, remain liable to City for any and all
Franchise Fees and Environmental Liability Fund Fees that would otherwise be payable
by Franchisee, for any and all late charges and interest assessed pursuant to Section 4
of this Agreement, and for any and all delinquent report/record charges assessed
pursuant to Sections 7 or 9 of this Agreement.
3. Franchisee shall have a continuing obligation to submit to City all
reports required by Sections 7 and 9 of this Agreement which relates to commercial
solid waste handling services performed by Franchisee up to and including the date of
termination, suspension, or expiration.
4. Franchisee shall allow the solid waste generators served by
Franchisee to arrange for commercial solid waste handling services with a solid waste
enterprise collector authorized to perform such services, without penalty or liability for
breach of contract on the part of the generators, for such period of time as Franchisee is
not authorized to perform such services because of termination or suspension.
5. Franchisee agrees to continue to provide the indemnifications
required in this contract after its suspension or termination. Such indemnifications
include, but are not limited to, the hazardous materials indemnification and AB939
indemnification as set forth in Section 11.
C. In the event this Franchise is terminated pursuant to Subsection A above,
then within the time period specified by the City Council, Franchisee shall remove all of
Franchisee's commercial solid waste containers, from all Franchisee's collection service
locations and shall properly dispose of all solid waste in such containers.
D. In the event the Franchise is terminated pursuant to Subsection A above
or expires without an extension of the term and without a grant of a subsequent
franchise allowing Franchisee to continue performing such services, then within ten (10)
days of such termination or expiration Franchisee shall either:
1. Submit to City's Municipal Operations Director a list of the names
and addresses of solid waste generators in Newport Beach for which Franchisee
provided services as of the date of termination or expiration (i.e. Franchisee's City of
Newport Beach customer list); or
2. Send written notification to each solid waste generator on
Franchisee's customer list that Franchisee is no longer authorized to provide
commercial solid waste handling services in the City of Newport Beach. Such
notification shall be in the form provided by City's Municipal Operations Director and
shall be personally delivered or shall be sent by first class mail, postage prepaid, to the
customers' billing addresses. Franchisee shall submit to City's General Services
Director an affidavit, signed under penalty of perjury, stating that the required
notification has been provided by Franchisee to all of Franchisee's City of Newport
Beach customers.
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SECTION 19. ASSIGNMENT
Franchisee shall not assign, sell, subcontract, transfer or otherwise delegate its
authority to perform any portion of the solid waste handling services or obligations under
the Franchise without prior express consent of the City Council. This prohibition
includes any transfer of ownership or control of Franchisee, or the conveyance of a
majority of Franchisee's stock to a new controlling interest. City's consent shall not be
unreasonably withheld.
SECTION 20. MISCELLANEOUS PROVISIONS
A. Notices. Except as otherwise provided in this Agreement, all notices
required by this Agreement shall be given by personal service or by deposit in the
United States mail, postage pre -paid and return receipt requested, addressed to the
parties as follows:
To: Municipal Operations Director
City of Newport Beach
P.O. Box 1768
100 Civic Center Drive
Newport Beach, CA 92660
To Franchisee: Scor Industries
2321 S. Willow Ave
Bloomington, CA 92316
Attention: Jorge Orozco
Notice shall be deemed effective on the date personally served or, if
mailed, three (3) days after the date deposited in the mail.
B. Integrated Agreement. This Agreement represents the full and complete
understanding of every kind or nature whatsoever between the City and Franchisee,
and all preliminary negotiations and other agreements of any kind or nature are merged
herein. No verbal agreement or implied covenant shall be held to vary the provisions
herein.
C. Amendments. This Agreement supersedes all prior agreements and
understandings between the parties and may not be modified or terminated orally, and
no modification, termination or attempted waiver of any of the provisions hereof shall be
binding unless in writing and signed by the party against whom the same is sought to be
enforced.
D. Applicable Law. The laws of the State of California, and applicable
Federal law, shall govern this Agreement and all matters relating to it and any action
brought relating to this Agreement shall be adjudicated in a court of competent
jurisdiction in the County of Orange.
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3 -29
E. Authoritv. The parties signing below represent and warrant that they have
the requisite authority to bind the entities on whose behalf they are signing.
F. Severability. If any term or portion of this Agreement is held to be invalid,
illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
G. Waiver. A waiver by either party of any breach, of any term, covenant or
condition contained herein shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition contained herein, whether
of the same or a difference character.
H. Interpretation. The terms of this Agreement shall be construed in
accordance with the meaning of the language used and shall not be construed for or
against either party by reason of the authorship of this Agreement or any other rule of
construction that might otherwise apply.
I. Equal Opportunity Employment. Franchisee represents that it is an equal
opportunity employer and it shall not discriminate against any authorized subcontractor,
employee or applicant for employment because of race, religion, color, national origin,
handicap, ancestry, sex or age or any other impermissible basis under law.
J. Compliance with Laws. Franchisee shall at its own cost and expense
comply with all statutes, ordinances, regulations and requirements of all governmental
entities, including federal, state, county or municipal, whether now in force or hereinafter
enacted. Franchisee agrees to obtain a business license from the City in accordance
with the Code. The parties hereto agree that the Franchise and this Agreement are the
only authorizations to conduct solid waste collection business in the City and that the
issuance of a business license does not grant the Franchisee a right to conduct solid
waste collection or other business in the City.
K. Conflicts of Interest. Franchisee or its employees may be subject to the
provisions of the California Political Reform Act of 1974 (the "Act "), which (i) requires
such persons to disclose any financial interest that may foreseeably be materially
affected by the work performed under this Agreement, and (ii) prohibits such persons
from making, or participating in making, decisions that will foreseeably financially affect
such interest.
If subject to the Act, Franchisee shall conform to all requirements of the Act. Failure to
do so constitutes a material breach and is grounds for immediate termination of this
Agreement by City. Franchisee shall indemnify and hold harmless City for any and all
claims for damages resulting from Franchisee's violation of this subsection.
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3 -30
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on
the day and year written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date:_
By: &
Aar C. Harp '(JAM wlnli�-
City Attorney 3A N1141f
ATTEST:
Date:
By:
Leilani I. Brown
City Clerk
CITY OF NEWPORT BEACH,
A California municipal corporation
Date:
Edward D. Selich
Mayor
CONSULTANT: SKYLINE
CONSTRUCTION SERVICE INC. dba
SCOR INDUSTRIES., a California
corporation
Date:
Jorge Orozco
President
Date:
Jorge Orozco
Secretary
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