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Home My WebLink About19 - Termination of Non-exclusive Commercial Solid Waste Franchise AgreementCITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. 19 March 23, 2010 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: General Services Department Mark Harmon, Director, 949 - 644 -3055, mharmon @newportbeachca.gov SUBJECT: Termination of Non - exclusive Commercial Solid Waste Franchise Agreement ISSUE: Should the City Council terminate the solid waste franchise agreement between the City of Newport Beach and Green Environmental Waste & Recycling, LLC? RECOMMENDATION: Hold a hearing pursuant to Newport Beach Municipal Code Section 12.63.140 and adopt the attached Resolution No. 2010 -_ terminating the solid waste franchise agreement between the City of Newport Beach and Green Environmental Waste & Recycling, LLC. DISCUSSION: Pursuant to Newport Beach Municipal Code ( "Code ") Section 12.63.030 the City currently has non - exclusive solid waste franchise agreements with 30 solid waste hauling firms. One of the firms has requested that the City terminate their solid waste franchise agreement. On March 5, 2010, Green Environmental Waste & Recycling, LLC ( "Green Environmental') gave City staff notice that it had been sold to Universal Waste Systems, Inc., and consequently, Green Environmental will no longer be in operation. Pursuant to Code Section 12.63.140, the City Council has the ability to terminate any non - exclusive commercial solid waste collection franchise agreement following a hearing and the making of certain findings. Specifically, the City Council must find Green Environmental Termination of Franchise March 23, 2010 Page 2 "(1) has failed to comply with, or to do anything required of the franchisee by this chapter, or that franchisee has violated any provision of the ordinance granting the franchise, including, but without limitation, failure to timely pay all franchisee fees, provide records in accordance with the City's request, file required reports, or has violated any provision of the franchise agreement or any Federal, State or local law or regulation applicable to franchisee's operations under the franchise; or (2) Any provision of [Code Chapter 12.63] or of the franchise agreement is repealed or becomes or is declared to be invalid, and the City Council expressly finds that such provision constitutes a material consideration to the grant or continuation of such nonexclusive franchise." (Code Section 12.63.140(D).) The City Council, if it is so inclined, may terminate Green Environmental's franchise agreement based upon two factors: (1) Green Environment has failed to timely pay its franchise fees and as of this date owes the City $1,861.55 in franchise fees; and/or (2) Green Environmental no longer exists as a legal entity, thus, its franchise agreement is no longer valid. The attached resolution terminates Green Environmental's franchise agreement and includes an attached agreement between the City and Green Environmental providing for the payment of the outstanding franchise fees. Environmental Analysis: This action is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Prepared by: Submitted by: Andrea Riles, Management Assistant Director Termination of Franchise March 23, 2010 Page 3 Attachments: (A) Proposed Resolution No. 2010- terminating the Franchise Agreement with Green Environmental Waste & Recycling, LLC (B) Agreement to Surrender Commercial Solid Waste Collection Franchise Agreement between the City of Newport Beach and Green Environmental Waste & Recycling, LLC RESOLUTION NO. 2010- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NEWPORT BEACH TERMINATING THE COMMERCIAL SOLID WASTE COLLECTION FRANCHISE AGREEMENT BETWEEN THE CITY OF NEWPORT BEACH AND GREEN ENVIRONMENTAL WASTE & RECYCLING, LLC WHEREAS, on February 26, 2008, the City of Newport Beach ( "City") granted a Non - exclusive Franchise to Green Environmental Waste & Recycling, LLC ( "Green Environmental ") for commercial solid waste collection services ( "Franchise Agreement "); and WHEREAS, on March 5,2010, the City was notified by letter that Green Environmental sold their business to Universal Waste Systems, Inc., and will no longer operate within the City; and WHEREAS, Green Environmental has requested, in writing, that the City terminate their Franchise Agreement; and WHEREAS, on March 8, 2010 the City mailed Green Environmental a notice of intent to terminate their Franchise Agreement pursuant to Newport Beach Municipal Code ( "Code ") Section 12.63.140(A); and WHEREAS, on March 23, 2010 the City Council held a hearing pursuant to Code Section 12.63.140 and received testimony from staff and interested parties regarding the termination of Green Environmental's Franchise Agreement. NOW, THEREFORE, be it resolved by the City Council of the City of Newport Beach that: 1. Based upon the evidence submitted at the hearing the City Council finds that Green Environmental owes the City $1,861.55 in franchise fees in violation of Code Section 12.63.140(D)(1). The City Council finds further, that in light of Green Environmental purchase and subsequent dissolution by Universal Waste Systems, Inc. 1 I i its Franchise Agreement is no longer valid under Code Section 12.63.140(D)(2). And the City Council expressly finds that this invalid Franchise Agreement constitutes a material consideration for the discontinuation of Green Environmental's Franchise Agreement. 2. The City Council hereby approves the termination of Green Environmental's Franchise Agreement. The Agreement to Surrender the Commercial Solid Waste Collection Franchise Agreement between the City of Newport Beach and Green Environmental Waste & Recycling, LLC attached hereto as Exhibit "A," is hereby approved and the City Manager is authorized to execute the Agreement as written. 3. The City Council finds that this resolution is not subject to the California Environmental Quality Act ( "CEQA ") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Adopted this day of 2010 CITY OF NEWPORT BEACH, A California Municipal Corporation Dated: By: ATTEST: CITY CLERK 2 MAYOR EXHIBIT "A" AGREEMENT TO SURRENDER COMMERCIAL WASTE COLLECTION FRANCHISE AGREEMENT BETWEEN THE CITY OF NEWPORT BEACH AND GREEN ENVIRONMENTAL WASTE & RECYCLING, LLC This Agreement is entered into on this day, the day of 2010 and executed by and between the CITY OF NEWPORT BEACH, a municipal corporation ( "CITY ") and GREEN ENVIRONMENTAL WASTE & RECYCLING, LLC ( "GREEN ENVIRONMENTAL "). RECITALS Pursuant to CITY Ordinance No. 2008 -7, CITY and GREEN ENVIRONMENTAL entered into a Commercial Solid Waste Collection Franchise Agreement dated February 26, 2008 ( "AGREEMENT "). On March 5,2010 CITY was notified by letter that GREEN ENVIRONMENTAL is selling the company and will no longer operate within the CITY. NOW THEREFORE, CITY and GREEN ENVIRONMENTAL agree as follows: 1. The AGREEMENT is hereby terminated, effective on April 10, 2010 and shall be of no further force and effect. 2. By signing this agreement, GREEN ENVIRONMENTAL agrees to surrender all rights to do business as Green Environmental Waste & Recycling, LLC to operate commercial solid waste collection services within the CITY limits. 3. GREEN ENVIRONMENTAL shall be liable for payment to the CITY of all applicable fees associated with the GREEN ENVIRONMENTAL's performance of solid waste collection services performed during the term of this AGREEMENT through April 10, 2010 including but not limited to the following: a. Current and outstanding Franchise Fees (currently estimated at $1,861.55) b. All applicable charges associated with late payment of Franchise Fees pursuant to Section 4 of this AGREEMENT C. All applicable charges associated with report delinquencies pursuant to Section 6 of the AGREEMENT 4. GREEN ENVIRONMENTAL agrees to submit any outstanding Disposal Reports per Section 6 of the AGREEMENT including Quarterly Disposal Report for the activity performed through April 10, 2010. 5. GREEN ENVIRONMENTAL agrees that it has removed, or will remove within fifteen (15) calendar days after the City Manager's approval of this agreement all equipment from GREEN ENVIRONMENTAL's service locations within the City limits. 6. GREEN ENVIRONMENTAL agrees that it will obtain a new franchise agreement with the CITY prior to initiating future solid waste collection services within the CITY's limits. WITNESS THE EXECUTION OF THIS AGREEMENT ON THE DATE WRITTEN BELOW EACH SIGNATUE: CITY OF NEWPORT BEACH, A Municipal Corporation Dated: By: City Manager ATTEST City Clerk "GREEN ENVIRONMENTAL" Green Environmental Waste & Recycling, Inc. By: _ Name: Title: Date: APPROVED AS TIO/ jFORM: V� City Attorney l� NOTICE OF PUBLIC HEARING Termination of Non - exclusive Commercial Solid Waste Franchise Agreement NOTICE IS HEREBY GIVEN that the City Council of the City of Newport Beach will hold a public hearing pursuant to Section 12.63.140 of the Municipal Code to terminate Green Environmental Waste & Recycling, LLC's non - exclusive solid waste franchise agreement. NOTICE IS HEREBY GIVEN that pursuant to Code Section 12.63.140, the City Council has the ability to terminate any non - exclusive commercial solid waste collection franchise agreement following a hearing and the making of certain findings. NOTICE IS HEREBY FURTHER GIVEN that said public hearing will be held on March 23. 2010, at the hour of 7:00 p.m. in the Council Chambers of the Newport Beach City Hall, 3300 Newport Boulevard, Newport Beach, California, at which time and place any and all persons interested may appear and be heard thereon. If you challenge this project in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice or in written correspondence delivered to the City at, or prior to, the public hearing. For information call (949) 644 -3055. eil ni Brown, City Clerk � City of Newport Beach Authorized to Publish Advertisements of all kinds including public minces by Decree of the Superior Court of Orange County. California. Number A -6214. September 29, 1461, and A -24831 June II. 1963. PROOF OF PUBLICATION STATE OF CALIFORNIA) ) ss. COUNTY OF ORANGE ) I am a Citizen of the United States and a resident of the County aforesaid: I am over the age of eighteen years, and not a party to or interested in the below entitled matter. I am a principal clerk of the NEWPORT BEACH - COSTA MESA DAILY PILOT, a newspaper of general circulation, printed and published in the City of Costa Mesa, County of Orange. State of California. and that attached Notice is a true and complete copy as was printed and published on the following dates: March 13, 2010 I declare, under penalty of perjury, that the foregoing is true and correct. Executed on March 17, 2010 at Costa Mesa, California. to / ^ / Signature RECEIVED r10 MAR 22 AM 7 53 VIDMOMKON r..nrIE.EIIIRr adaly[ CEr.rtY sf+ew�l! huAwAromw Nona is Noisy GY EN that the City Council of the City of Newport Beach will hold a public hearing pursuant to Seo lion 12.63.140 of the Municipal Code to term, note Green Envrconmem tal Waste E 11.1 zz LLC's nOn -lime sd .d waste irancniTe agreement. NOTICE IS HER] OIV- EN that pursuant to Code Section 12.63.140. the oily Council has me ability to terminate any nomeacluvva Gomm*, cal solid waste colloc lion franchise agreement lollowmg a hearing and I me making of certain hndmQQs NO1K! IS NERDT iUR- pNIR aV[N that said public hearing will be on thercN 7f 201 o 7010, at the hour of Chambers ao 3.m m the Council "t Ba of the New. 3300 Beach Boo Nall. 3300 Newport Boulevard. Newport Beach. C ma, at n lime e and and place any y and all per, sons interested may Ap pear and be heard meson. If you ourt. YOU ton proMCI e limited m coon. you may be smiled to moor only those ears you or the public else ranee at mr public healing de, robed in this notice e s written erect to the City a delivered l3 the Cdr at. or prior to. the pubic or information call (949) 6443055 Lenani Brown. City Chalk City of Newport Beach Published Newport Beach /Costa Mesa Cady Pilot March 13. 2010 Sal-14