HomeMy WebLinkAboutINTEGRATED WASTE MANAGEMENT DEPARTMENT (IWMD)/ WASTE DISPOSAL AGREEMENT - 1997-03-17�0 Janice V. Goss, Director
4t N OA _ 320 NFlower SUmrt, Sure 400
J s~� x Santa Ana, CA �)2703
COUNTY OF ORANGE
O C.,
u ns 'Aw,- SN1, ndf�l_ l oT
�� INTEGRATED WASTE MANAGEMENT DEPARTMENT Telephone (714) R34—t000
�4IFOR� fax: (714) 834-3183
July -13, 2004
Ms. Liz Ehring
Assistant City Clerk
City of Huntington Beach
2000 Main Street
Huntington Beach, CA 92648
Subject: Executed Amendment to Waste Disposal Agreement (WDA)
Dear Ms. Ehring:
Enclosed for your records, please find one (1) fully executed copy of the Amendment to the
WDA that was approved by the County of Orange Board Supervisors on June 22, 2004.
If you have any questions
brian.uyeda -a iwmd_ocgov.com.
Sincerely,
Brian A. Uye
Contract Administrator
BU:bu
Enclosure
please contact me at (714) 834-4105 or
cc: Joan Flynn, Recycling Coordinator, w/o Enclosure
l -
WDA Exec Arrknd Ur - Huntington Beach
fast 1 of I
CITY OF HUNTINGTON BEACH
2000 MAIN STREET
OFFICE OF THE CITY CLERK
CALIFORNIA 92648
LETTER OF TRANSMITTAL OF ITEM APPROVED BY THE CITY COUNCIL/
REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH
DATE:
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City, State, Zip
ATTENTION: , }
DEPARTMENT:
REGARDING: mt'
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6c4S7-157 01,L10ol'4e"
See Attached Action Agenda Item 2EL() Date of Approval D
Enclosed For Your Records Is An Executed Copy Of The Above Referenced Agenda Item.
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Attachments: Action Agenda Page Agreement Bonds Insurance
RCA Deed Other —
CC: (� S C(J
Nam artment RCA
Agreement Insurance Other
N �_ De artment RCA Agreement Insurance Other
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Name Department RCA Agreement Insurance Other
Name Department RCA Agreement Insurance Other
g:lfollowupiletterslcoverltr.doc (Telephone: 714-536-5227 )
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Council/Agency Meeting Held: •S,
Deferred/Continued to: '
Approved ❑ Conditionally Approved ❑ Denied�� s Sig a ure
Council Meeting Date: May 17, 2004 Depart ` n D Number: PW-04-47
ti
CITY OF HUNTINGTON BEACH'
REQUEST FOR COUNCIL ACTION ±� "-
�f
SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS
SUBMITTED BY: WILLIAM P. WORKMAN, Acting City Administratqr
PREPARED BY: ROBERT F. BEARDSLEY, Director of Public Works
SUBJECT: Amend the Waste Disposal Agreement with the County of Orange
Statement of Issue, Funding Source, Recommended Action, Alternative Action(s), Analysis, Environmental Status, Attachment(s)
Statement of Issue: Amendment No. 1 to the Waste Disposal Agreement between the City
of Huntington Beach and the County of Orange has been submitted by the Orange County
Integrated Waste Management District (IWMD) with a request for approval by the City
Council.
Funding Source: This agreement will not financially impact the City since it holds the
landfill tipping fee at $22 per ton for an additional 3 years — through June 30, 2010.
Recommended Action: Motion to
Approve and authorize the Mayor and City Clerk to execute the Amendment No. 1 to the
Waste Disposal Agreement between the City of Huntington Beach and the County of Orange.
Alternative Action(s):
Deny the motion, and the Agreement will expire after June 30, 2007.
E - 1 D
REQUEST FOR COUNCIL ACAN
MEETING DATE: May 17, 2004
DEPARTMENT ID NUMBER: PW-04-47
Analysis: The County of Orange currently has Waste Disposal Agreements (WDA's) with
Orange County cities (including Huntington Beach), sanitary districts. and commercial haulers.
Under these Agreements, contracted entities guarantee that all solid waste generated in their
jurisdictions will be delivered to the County's landfill system_ These Agreements currently
guarantee a contract rate of $22 00 per ton for a ten-year period through June 30. 2007.
In accordance with Article VI, Section 6.1 (B), these may be renewed by mutual agreement of
the parties, on or before June 30, 2004, for an additional term of ten years under the same
terms and conditions as during the initial term of the agreements. The contracted entities shall
give the County written notice of their irrevocable election to renew their Agreements on or
before June 30, 2004. If the parties do not renew the Agreements by June 30. 2004, the
Agreements shall expire on June 30, 2007.
The IWMD is in the process of analyzing the lifespan of the FranK R. Bowerman (FRB) and the
Olinda Alpha Landfills. The evaluation process will require a complex and time consuming
effort that must be completed before IWMD can begin negotiations with the contracted entities
regarding a new contract rate and a long-term commitment extension for the Agreements.
In recognition of the requirements necessary to complete the process for evaluating the
possible expansions of FRB and Olinda, and address the renewal of the WDA's, the IWMD
proposes that the WDA's be amended to include the following provisions-
1. Amend the "Initial Term" of the Agreement by increasing it three (3) years from June 30,
2007 to June 30, 2010
2. Maintain the current contract rate of $22 00 per ton through June 30, 2010
3. Amend the "Option to Renew" provision (Section 6.1 subparagraph B) to state that the
Agreement shall be subject to renewal (the "Renewal Term') by mutual agreement of
the parties on or before June 30, 2008, for an additional term of ten years_ If the parties
do not renew the Agreement by June 30. 2008, the Agreement shall expire on June 30,
2010.
4. Amend the "Contract Rate During the Renewal Term" to include that the parties shall,
on or before June 30, 2008, negotiate an applicable change to the Contract Rate for
such renewal term.
5. Amend the "Calculation of Average Annual Inflation" chart in Section 4.2 (F) of the
Agreement by extending the chart three years-
6- Amend the In -County and Importation Tonnage Targets in Appendix 2 by extending the
charts three years. The figures shown for the three additional years reflect the minimum
tonnage amounts necessary to maintain the $22.00 per ton Contract Rate_
The proposed amendment to the WDA is placed as Attachment 1
G-1R C A12004104-D47 May 17 Flynn (Amend the Waste Disposal Agreement) doc -2-
5/312004 10-05 AM
REQUEST FOR COUNCIL ACTION
MEETING DATE: May 17, 2004 DEPARTMENT ID NUMBER: PW-04-47
Environmental Status: Not applicable.
Attachment(s):
RCA Author_ .cones/Flynn
G.1R C A12004104-047 May 17 Flynn (Amend the Waste Disposal Agreement) clot -3-
513120D4 10:05 AM
ATTACHMENT #1 .1
ANIENDMENT NO. 1
TO WASTE DISPOSAL AGREEMENT
WITH CITY OF
HUNTINGTON BEACH
This Amendment No. 1 is made and entered into on this 22"a day of June 2004, by and
between the COUNTY OF ORANGE, a political subdivision of the State of California
(hereinafter "COUNTY") and CITY designated above (hereinafter "CITY"). The CITY is a
general law or charter city and political subdivision of the State of California.
RECITALS
WHEREAS, COUNTY and CITY entered into a Waste Disposal Agreement (hereinafter
"Agreement") on April 8, 1997, guaranteeing that CITY shall deliver or cause to be delivered to
the Orange County Landfill Disposal System, all of the municipal solid waste generated within
its jurisdiction for ten years; and
WHEREAS, COUNTY and CITY have agreed to a three-year extension of the
Agreement, amending the provisions for the Initial Term, Option to Renew, Calculation of
Average Annual Inflation, and Cumulative Tonnage Targets for County and Importation
Acceptable Waste.
NOW, THEREFORE, the parties hereto agree as follows:
Section 6.1. subparagraphs (A), (B), and (C) are deleted and replaced with the
following:
(A) Initial Term. This Agreement shall become effective, shall be in full force and
effect and shall be legally binding upon the CITY and the COUNTY from the
Contract Date and shall continue in full force and effect until June 30, 2010, unless
earlier terminated in accordance with its terms, in which event the 'Perm shall be
deemed to have expired as of the date of such termination.
(B) Option to Renew. This Agreement shall be subject to renewal by mutual
agreement of the parties, on or before June 30, 2008, for an additional term of ten
years (the "Renewal Term") on the same terms and conditions as are applicable
during the Initial Term hereof. The CITY shall give the COUNTY written notice of
its irrevocable election to renew this Agreement on or before June 30, 2008. If the
parties do not renew this Agreement by June 30, 2008, the Agreement shall expire on
June 30, 2010.
(C) Contract Rate During Renewal Term. In connection with the parties' right to
renew this Agreement for an additional ten-year term pursuant to Section 6.1(13), the
parties shall, on or before June 30, 2008, negotiate an applicable change to the
WDA Amend 1 Huntington Beach
Page I of 6
Contract Rate for such renewal term. In determining any revisions to the Contract
Rate to be applicable during any renewal period, in addition to the circumstances
described in Section 4.2(A), the parties may take into consideration the following
parameters, including but not limited to:
(i) actual cost of operations;
{ii) population growth;
(iii) increase or decrease in available tonnage;
(iv) economic and disposal market conditions in the Southern
California region;
(v) changes in transportation and technology;
(vi) closure and expansion of nearby landfills;
(vii) capacity of the Disposal System; and
(viii) available reserves.
2. Section 4.2 (F) is deleted and replaced with the following:
(F) Calculation of Average Annual Inflation. For purposes of Section 4.2(A)(11), the
inflation shall be calculated as the change in the Producer Price Index, Finished
Goods ("PPI"), reported by the Bureau of Labor Statistics of the United States
Department of Labor between July of the year of calculation and July 1, 1997.
Average annual inflation shall be deemed to exceed 4% if the ratio between the PPI
Index for July for the year of calculation (calculated in accordance with the formula
below) and July 1997 exceeds the ratio corresponding to such year of calculation on
' the table below. The ratio shall be calculated in accordance with the following
formula:
(July PPI Index of Calculation Year / PPI Index for July 1997)
Year of Calculation
Ratio
July 1, 1997
1.0000
July 1, 1998
1.0400
July 1, 1999
1.0816
July 1, 2000
1.1248
July 1, 2001
1.1698
July 1, 2002
1.2166
July I, 2003
1.2653
July 1, 2004
1.3159
July 1, 2005
1.3685
July 1, 2006
1.4233
July 1, 2007
1.4802
July 1, 2008
1.5394
July 1, 2009
1.6010
July 1, 2010
1.6650
WDA Amend 1 Huntington Beach
Page 2 of 6
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In the event the PPI is no longer published during the term of this Agreement, such other
index identified by the Bureau of Labor Statistics or otherwise generally accepted as a
replacement for PPI shall be used for purposes of this Service Agreement.
3. APPENDIX 2 is deleted and replaced with the following:
This space intentionally left blank.
WDA Amend 1 Huntington Beach
Page 3 of 6
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APPENDIX 2
Cumulative In -County Tonnage Target to be Used
for Purposes of Section 4.2 (B)
Fiscal Year
1997 - 1998
1998 - 1999
1999 - 2000
2000 - 2001
2001 - 2002
Tonnal
2,277
2,134
2,007
2,025
2.042
Cumulative T
2,277
_ 4,411
6,418
8,443
10.485
2002 - 2003
2,060
12,545
2003 - 2004
2,079
14,624
2004 - 2005
2,096
16,720
2005 - 2006
2,111
18,831
2006 - 2007
2,128
20,959
2007 - 2008 *
4,033
24,992
2008 - 2009 *
4,437
29,429
2009 - 2010 *
4,556
33,995
Note. Tons are expressed in thousands.
* Fiscal years reflect the minimum tonnage necessary to support the Contract Rate.
Annual Importation Tonnage Target to be Used
for Purposes of Section 4.2 (C)
Year
Fiscal Year
Import Tonn e
1
1997 - 1998
1,428
2
1998 - 1999
1,428
3
1999 - 2000
1,428
4
2000 - 2001
1,428
5
2001 - 2002
1,429
6
2002 - 2003
1,428
7
8
2003 - 2004
2004 - 2005
1,428
1,428
9
2005 - 2006
1,428
10
2006 - 2007
1,428
11
2007 - 2008 *
1,166
12
2008 - 2009 *
1,166
13
2009 - 2410 *
1,166
Note: Tons are expressed in thousands.
* Fiscal years reflect the minimum tonnage necessary to support the Contract Rate.
WDA Amend t Huntington Beach
Page 4 of 6
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4. All other terms and conditions of the Agreement will remain unchanged and CITY
agrees to comply with all terms and conditions of the Agreement.
This space intentionally left blank.
WUA Amend 1 Huntington Beach
Page 5 of 6
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IN WITNESS WHEREOF, the parties have executed this First Amendment to Agreement the
day and year first above written.
Date: ���Z
APPROVED AS TO FORM:
OFFICE OF THE COUNTY COUNSEL
ORANGE COUN Y, CALIFORNIA
Date: V
Date:
Date:
Date:
"COUNTS""
COUNTY OF ORANGE
By' �� 9arQ
Adnice V. Goss, Director
integrated Waste Management Department
j:
By:
WDA Aniend I Huntington Beach
Page 6 of 6
IN WITNESS WHEREOF, the City of Huntington Beach has executed the aforesaid
AMENDMENT NO. 1 TO WASTE DISPOSAL AGREEMENT WITH THE COUNTY OF
ORANGE by and through its authorized officers on 1-4- , 2004.
,-wAsCity Clerk
REVIEWED AND APPROVED:
ATE AND APPROV
Director of Public Works
RCA ROUTING SHEET
INITIATING DEPARTMENT: Public Works
SUBJECT: Amend the Waste Disposal Agreement with the County of
Orange
COUNCIL MEETING DATE: May 17, 2004
RCA ATTACHMENTS
STATUS
Ordinance (wlexhibits & legislative draft if applicable)
Not Applicable
Resolution (wlexhibits & legislative draft if applicable)
Not Applicable
Tract Map, Location Map and/or other Exhibits
Not Applicable
ContracVAgreement (wlexhibits if applicable)
(Signed in full by the P((y Attome)
Attached
Subleases, Third Party Agreements, etc.
(Approved as to form by City Attome)
Not Applicable
Certificates of Insurance (Approved by the City Attomey)
Not Applicable
Financial Impact Statement (Unbud et, over $5,000)
Not Applicable
Bonds (If applicable)
Not Applicable
Staff Report (If applicable)
Not Applicable
Commission, Board or Committee Report (If applicable)
Not Applicable
Findings/Conditions for Approval and/or Denial
Not Applicable
EXPLANATION FOR MISSING ATTACHMENTS
REVIEWED
RETURNED
FOO&RDED
Administrative Staff
( )
Assistant City Administrator (initial)
)
{ )
City Administrator lnitial
( )
[City Cleric
( )
EXPLANATION FOR RETURN OF ITEM:
RCA Author. Jones/Flynn
f�
`� OUNTY OF
�M1 I
3 RANGE
\ V
1 INTEGRATED WASTE MANAGEMENT DEPARTMENT
320 N Flower Street, Suite 400
Santa Ana, California 92703
(714) $34-4000
FAX (714) 834-4001
June 19, 1997
Janelle Case
Office of the City Clerk (6(X).45)
City of Huntington Beach
2000 Main Street
Huntington Beach, California 92648
Dear Ms. Case:
VICKI L_ WILSON
Director
Enclosed is the fully executed copy of the Waste Disposal Agreement between the City of
Huntington Beach and the County of Orange. The contract has the appropriate original
signatures. Also attached is a copy of the Board of Supervisors minute order authorizing the
agreements and designating Vicki L. Wilson as the signatory on behalf of both Integrated Waste
Management Department and the County of Orange Board of Supervisors with respect to these
agreements.
Thank you for working with us on the matter. We look forward to working with you in this
endeavor to provide environmentally safe disposal while minimizing costs.
Yours truly.
Jan Goss, Manager
Government and Community Relations
JC
Ct* P,.mod cn rccyded r*zL4
i
ORANGE COUNTY BOARD OF SUPERVISORS
MINUTE ORDER
?&e ddzu, " 9 ra "A" ta&.A 4 de gu"d 4 s4mm� weA9 l 1997.
APPROVED AS RECOMMENDED OTHER
S.O. Closed public hearing
Unanimous ■ (1) Smith (2) Silva (3) Spitzer (4) Steiner (5) Wilson
Vote Key- Y=Yes: N=No: A=Abstain; X=Excused: B.O_ =Board Order
Documents accompanying this matter:
Resolution(s)
Ordinances(s)
Contract(s)
bmattrg Agerrcv1Dg rtment. Integrated Waste ,Vanagement Department
IDR�: Public Hearing to consider approving Agreements for City Waste Disposal,
Sanitary District Waste Disposal and Hauler Waste Disposal; authorizing Director of
Integrated Waste Management Department to execute approved and future Agreements
that are executed on or before 711197; making California Environmental Quality Act
findings; and adopting proposed reduced landfill disposal fee schedule for County
generated waste (effective 711/97) - All Districts
Fite No_ 6-U
Item No. ¢d
Special Notes.
Copies sent to-
I certify that the foregoing is a true and correct copy of the
Minute Order adopted by the Board of Supervisors. Orange
County. State of California.
DARLENE J. BLOOM, Clerk of the Board
-
Deputy
c luscrlminordmd_doc
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-A/ MIT
HUNTINGTON BEACH
From the desk of.
City of Huntington Beach
P.O. Box 194 - 2440 Main Street
Huntington Beach. California 92648
www.ci.huntington-beach.ca.us
Dale Jones
Deputy City Clerk
Telephone. (714) 374-1632
Fax: (714) 374-1557
1
p 0 !I ,AS
J' CITY OF HUNTINGTON BEACH
CITY ADMINISTRATOR COMMUNICATION
MUNTINGTON BEACH
To: Connie Brockway, City Clerk
From: Ray S&Wr, Assistant City -Administrator t74� J�
Date: March 14, 1997
Subject: Orange County.Solid Waste Disposal Agreement
Item F-1 on the March 17th City Council agenda includes approval of the Orange County Solid
Waste Disposal Agreement.
Attached is a late communication from Vicki L Wilson, Director of the Orange County
Integrated Management Department_ This letter details some minor changes in the agreement
that was submitted with our Request for Council Action. Included are clean copies of amended
pages 5, 13, 19, 20, and 30 of this agreement.
Would you replace these pages in the original contract and include a copy of Vicki Wilson's entire
packet in your late communication memo to the City Council on Monday, March 17th Thank
you;,
RS-PD .
xc, City Council Members
City Administrator X
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VICKI WILSON
Dvedor
Y OF
NGE
March 11, 1997
INTEGRATED WASTE MANAGEMENT DEPARTMENT
320 N Flower Street. Surte 400
Santa Ana, California. 92703
(714) 834-4000
FAX (714) 834-4001
TO City Managers
FROM- Vicki L. Wilson, Director
Integrated Waste Management Department
SUBJECT: Revised Pages for the Waste Disposal Agreement
Revised Panes
The enclosed revised pages include the following minor changes -
Technical Changes to Sections 3.1. (E) and 6.1 (D)
Clean pages are included to replace those sent to you by FAX on February 27
Typographical errors referencing Sections 3.9 and 7.3 (B)
Section 3 9 does not exist. The reference should be Section 3 6.
Section 7.3 (B) should be Section 7 3.
Clean copies of these pages are included as well_
Signature Pages
Please remind your City CIerks that the County needs three original signature pages. When the
agreement is executed, be sure that you obtain the number of original signature pages the city requires
in addition to the County's required three originals.
Should there be any questions, please don't hesitate to call Jan Goss of my staff at 714-834-4108
Vicki L Wilson
Enclosures
s-khVPjg
"County" means the County_ of Orange, a political subdivision of the State of California and
party to this Agreement
"County Plan" means the integrated waste management plan of the Count-,- approved by the
Board pursuant to the Act as in effect from time to time.
"County Acceptablc Waste" means Acceptable Waste generated in the CocnitV
"County Waste Management Enterprise Fund" means the waste management enterprise fund
established and managed by the County pursuant to Section 25261 of the Government Code separate from its
other funds and accounts for receipts and disbursements in connection with the Disposal System
"County -.ride Recycling Services" has the meaning set forth in subsection a 7(A) hereof
"Cumulative Tonnage Target" for any given Contract Year means the amount specified in
Appendix 2 hereto with respect to such Contract Year.
"Department" means the Orange County Integrated Waste Management Dcpartmcnt, and any
agency, department or other Governmental Body which succeeds to the duties and powers thereof
"Disposal Agreements" means each of the waste disposal agreements entered into betweenthe
County and any city within the County in accordance herewith.
"Disposal Services" means the solid waste disposal scry cs~to be provided by the County
pursuant to the Service Covenant and otherwise hereunder.
"Disposal System" means the Orange Cofmty Waste Disposal System which includes solid waste
disposal operations at four active landfills (OIinda Alpha, Frank R_ Bowerman, Prima Dcshecha and Santiago);
four regional Household Hazardous Waste Collection Centers; as well as services, such as monitoring and other
f
activities, at refuse stations formerly operated by the County, as appropriate under Applicable Law
"Environmental Fu " means the fund or funds held by the County to pay unanticipated costs
of environmental mitigation, rem cation or liability_
" Excess Im rt Revenues" has the meaning ascribed thereto in Section +39(E)
"Franc se Hauler" means any hauler or collector who provides Acceptable Waste collection
services within the City; cant to, or under authority granted by, a contract, franchise or other agreement wish
the City_ The term Vanchise Hauler includes the City itsclf if Acceptable Waste collection and transportation
services are provided directly by City operated municipal collection service
"Governmental Body" means any federal, State, county, city or regional legislative, executive,
judicial or o governmental board, agency, authority, commission, administration, court or other body, or any
officer Cher f acting within the scope of his or her authority.
"Hazardous Substance" has the meaning given such term in CERCLA, the Carpenter -Presley -
Tanner Hazardous Substance Account. Act (California licaith and Safety Code Section 25300 (West 19cj2
Execution Copy
transfer station as an intermediate step prior to landfill disposal) and otherwise to comply with its obligations
under this Agreement with respect to Controllable Waste and Franchise Haulers, and (it) the City shall designate
the Disposal System as the disposal location pursuant to such franchise, contract, lease or other agreement. On
and after the Commencement Date and throughout the Term of this Agreement the City (a) shall not enter into
any franchise, contract, lease, agreement or obligation, issue any permit, license or a� .proval, or adopt any
ordinance. resolution or law which is materially inconsistent with the requirementsHof' the Waste Disposal
Covenant, and (b) shall maintain non-exclusive or exclusive; franchises or other con6actual arrangements over
any Civ Acceptable Waste which, as of the Contract Date, is subject to non-exclusive or exclusive franchise or
other contractual arrangements The City agrees that the County shall be a Hurd patty benefician, of the obligation
of Franchise Haulers to delivery Controllable Waste to the Disposal System_ and may directly enforce such
obligation through any legal means available. The City shall notify in,Wnting each Franchise Hauler of the
County's third party beneficiary rights_ i
(E) Waste Flow Enforcement. (1) The Citv, to cooperation with the Department, shall
establish, implement, cam out and enforce a waste flow enforce/rncnt program which is sufficient to assure the
delivery of all Controllable Waste to the Disposal System pursuant to and in accordance with the Waste Disposal
Covenant for disposal at the tunes and in the manner providcd•herein. The waste flow enforcement program shall
consist of amending City franchises with all Franchise Haulers, to the extent required by this Section, and shall
include in addition; to the extent necessary and appropriate in the circumstances to assure compliance with the
Waste Disposal Covenant, but shall not be limited to (i) licensing or permitting Franchise Haulers, upon the
condition of compliance with the Waste Disposal Covenant, (U) providing for and taking appropriate enforcement
action under any such franchise, license, or pemut, such as but not limited to the suspension, revocation and
termination of collection rights and privileges, the'imposition of fines or collection of damages, and the exercise
of injunctive relief against non -complying Franchise Haulers and (iii) causing any Transfer Station to which
Controllable Waste is delivered for processing.to deliver certification, under the penalty of perjury, of the amounts
of Controllable Waste received and Residue remaining from processing at such Transfer Station (2) The City
ackmowledges and agrees that in the event of a breach of the Waste Disposal Covenant by the City, the City shall
pay the County an amount equal to the Contract Rate in effect at the time of such breach (or anv higher rate with
respect to which the County has provided notice pursuant to Section 4.2(G)) multiplied by the number of tons
of City Acceptable Waste delivered to the Disposal System during the preceding twelve months (or, if the City
had been in breach of the Waste Disposal Covenant during such prior months, such amount as would have been
delivered if the City had complied with the Waste Disposal Covenant), multiplied by the number of years
remaining in the Term of the Agreement. The parties recognir�e that if the City fads to meet its obligations
hereunder, the County will suffer er damages and that it is and will be impracticable and extremely difficult to
ascertain and determine the exact amount of such damages_ Therefore, the parties agree that the damages
specified above represent reasonable estimate of the amount of such damages, considering all of the
circumstances existing on the date hereto, including the relationslup of the sums to the range of harm to the
County that reasonably -could be anticipated and anticipation that proof of actual damages would be costly or
inconvenient. In signing this Agreement, each party specifically confirms the accuracy of the statements made
above and the fact Ntreach party had ample opportunity to consult with legal counsel and obtain an explanation
of this liquidated damage provision at the time that this Agreement was made-
(F) Legal Challenges to Franchise System_ The City shall use its best efforts to preserve,
protect and deWnd its right to exercise and comply with the Waste Disposal Covenant against an), challenge
thereto, lcga or otherwise (including any lawsuits against the City or the County, whether as plaintiff or
defendant), y a Franchise Hauler or any other person, based upon breach of contract, violation of law or any
other legal eon, The City shall bear the cost and expense of any such Legal Proceeding or other challenge.
in the event any such Legal Proceeding relating to the Waste Disposal Covenant or the City's exercise thereof
Execution Copy 13 (Revised Page)
i
ARTICLE IV
CONTRACT RATE
SECTION 4.1 CHARGING AND SECIJRING PAYMENT OF CONTRACT RATE The Gtv
acknowledges that the Countyshall have the right to charge and collect a Contract Rate for the acceptance and
disposal of Controllable Waste delivered to the System by any Franchise Hauler. The Contract _Rate shall be
calculated and established, and may be modified, as provided in Section 4.2 hereof. In addition, the C11
acknowledges that the County shall have the right to establish as part of the operating rules and regulations
reasonable measures to secure the payment ofall Contract Rates Ile
SECTION 4 2_ Contract Rate. (A) Initial Term Effectiye'July 1, 1997, the Contract Rate
payable by each Franchise Hauler shall be $22.00 per ton, contingent on the deliven• to the Disposal System of
an amount of Acceptable Waste at least equal to the Cumulative Tonnage<Targets identified in Appendix 2, and
subject to potential adjustment necessary to reflect the circumstanccs.sct forth below
(1) increased costs incurred by the County (ui.excess of available insurance proceeds) due
to the occurrence of one or more Uncontrollable Circumstances. including Changes in Law;
(ii) average annual inflation at any pint during the Term of this Agreement in excess of
four per cent, compounded annually, calculated in -accordance with Section 4.2 (F),
.'r
(iu) costs incurred by the County�(in excess of available insurance proceeds and amounts
available in the Environmental Fund for such purposes) remediating environmental conditions at the
Disposal System or inactive or closed disposal sites in the County, which, if uncorrected, could give rise
to potential claims under CERCLA or related federal or state statutes, including costs incurred providing
indemnification to any Participating City pursuant to subsection 7.3(B)(but not including costs of
obtaining insurance pursuant to Section 3-3(F)), or
(iv) tonnage shortfalls to the extent permitted by Scctioas 4.2(B) and 4.2(C)_
r
Prior to adjusting the Contract Rate as'a result of any of the circumstances described above, the County shall
utilize the following remedies in the following order of priority-
(1) reduce the costs of operating the Disposal System to the extent practicable;
0i) utilize Excess Import Revenues to pay costs of the Disposal System; and
(iii) utilize Unrestricted Reserves to pay costs of the Disposal System
Any adjustments to the Contract Rate permitted by this Section shall be calculated by the County to reflect the
actual costs or expenses of addressing the circumstance or circumstances pursuant to which the adjustment is
authorized-
(B) County Acceptable Waste Shortfall. In the event that the actual amount of County
Acceptable Waste do
vered to the Disposal System at the end of any Contract Year is less than the Cumulative
Tonnage Target f such Contract Year for County Acceptable Waste, as specified in Appendix 2, the County
shall utilize the f !lowing options, in the following order of priority, in order to remedy any adverse effects of
such tonnage s rtfall
(i) reduce the costs of operating the Disposal System to the extent practicable,
Execution Copy 19
•
(U) utilize E-xccss Import Revenues to pay costs of the Disposal System.
(iii) utilize Restricted Reserves described in clause (in) of Section 45 to pay costs of the
Disposal System,
(iv) utilize Unrestricted Reserves to pay costs of the Disposal System, and
(v) adjust the Contract Rate
In the event that implementation of the steps described above do not result in sufficient` revcnues to satisfactorily
address the shortfall in tonnage, the County shall have the right to terminate the Agreement on 60 days %%Tittcn
notice to the City_ In addition, in the event that actual deliveries to the Disposal System exceed the Cumulative
Tonnage Target as of the end of any Contract Year, the City acknowledges the County shall have the right to
establish resen•es intended to reflect the potential for loner than expected annual waste deliveries in subsequent
years, and that any such reserves shall constitute "Restricted Reserves"
(C) Imo_ne Acceptable Waste Shortfall_ In the event that the actual amount of Imported
Acceptable Waste delivered to the Disposal System at the end of any Contract Year is less than the Annual
Imported "Tonnage Target for such Contract Year for Impo* Acceptable Waste, as specified in Appendix 2,
the County shall utilize the following options, in the following order of priority, in order to (i) provide the net
annual payment to the County described in Section 3 9(E) of at least $15,000,000 and (ii) generate sufficient
revenues from the acceptance of Imported Acceptable Waste to continue to accept County Acceptable Waste for
the then applicable Contract Rate:
(i) reduce the costs of operating,the Disposal System to the extent practicable,
(ii) utilize Excess Import Revenues to pay costs of the Disposal System, and
(1ii) utilize Unrestricted Reserves to pay costs of the Disposal System
%
In the event that, after implementation of the options described above, the sufficient revenues from the acceptance
of Imported Acceptable Waste are not/available to both (1) provide the net annual payment to the County
described in Section 3.9(E) of at least S 15,000,000 and (ii) generate sufficient revenues from the acceptance of
Imported Acceptable Waste to continue to accept County Acceptable Waste for the then applicable Contract Rate,
then the County may propose in ranting to the Participating Cities an adjustment to the then applicable Contract
Rate intended to achieve both requirements described above- The Participating Cities shall then have the right
to either (i) accept the proposed adjustment to the Contract Rate or (ii} terminate the Agreement in x-Titing Any
Participating City %Niiich does not terminate the Agreement within 45 days after receipt of notice of the proposed
adjustment from the County shall'be irrc►-ocably deemed to have agreed to the proposed adjustment In the event
that a sufficient number of Participating Cities (as reasonably determined by the County in light of then current
circumstances ) do not agree in -writing to the proposed adjustment to the Contract Rate within such 45 day period,
then the County may terminate the Disposal Agreements.
(D) nterim Use of Remedies In the event that, during any Contract Year, waste deliveries
to the Disposal System arc 25% or more below delivery projections for such Contract Year with the result that
the County determines t is unlikely that the Cumulative Tonnage Target or Annual Imported Tonnage Target
will be achieved as of a end of such Contract Year, the County may utilize the remedies described in Section
4.2(B) or 4.2(C), as pplicablc prior to the end of such Contract Year, provided, ho%.vever, that if at the end of
such Contract Ye the Cumulative Tonnage Target or Annual Imported Tonnage Target (as applicable) are
actually met, the Co ty shall reimburse any adjustments to the Contract Rate made pursuant to this Section to
Participating Cities. Such reimbursement may be given as a credit or adjustment to the Contract Rate for future
deliveries, rather than a lump sum payment
Execution Copy 20 (Kcvised f'agO
ARTICLE VI
TERM
SECTION 6.1. EFFECTIVE DATE AND TERM- (A) Initial Term_ This Agreement shall
become effective, shall be in full force and effect and shall be legally binding upon the City and the'County from
the Contract Date and shall continue in full force and effect until the tenth anniversary of the first day of the
Contract Year following the Contract Year in which the Commencement Date occurs, unless earlier terminated
in accordance with its terms, in which event the Term shall be deemed to have expired as of the date of such
termination_
(B) Option to Renew. This Agreement shall be subject to renew a] by mutual agreement of
the parties, on or before June 30, 2004, for an additional term of ten years (the "Renewal Term") on the same
terms and conditions as are applicable during the Initial Term hereof The City shall give the County written
notice of its irrevocable election to renew this Agreement on or before June 30,.2004. If the parties do not renew
this Agreement by June 30, 2004, the Agreement shall expire on June 30, 2607.
(C) Contract Rate During Renewal Term. In connection with the parties right to renew this
Agreement for an additional ten-year term pursuant to Section 6.1(B)the parties shall, on or before June 30,
2004, negotiate an applicable change in the Contract Rate for such renewal term_ In determining any revisions
to the Contract Rate to be applicable during any renewal period, in addition to the circumstances described in
Section 4.2(A), the parties may take into consideration the following parameters, including but not limited to
(1) actual cost of operations:
(ii) population growth, ,3
(ill) increase or decrease in available tonnage;
(iv) economic and disposal market conditions in the Southern California region,
(v) changes in transportation and technology,
(vi) closure and expansion of nearby landfills;
(vit) capacity of the Disposal System and
(viii) available rescn!es_
(D) Survival, Accrued Rights_ The rights and obligations of the parties hereto pursuant to Sections
3- I(E)(2), 5.1, 5.3, 5.5, 7.2, 7 3, 7.5, 7.7, 7.5, 7.9, and 7.10 hereof shall survive the termination or expiration of
this Agreement, and no such termination or expiration shall limit or otherwise affect the respective rights and
obligations of the parties hereto accrued prior to the date of such termination or expiration_ At the end of the
Term of this Agreement, all other obligations of the parties shall terminate.
SECTION 6.2. COMMENCEMENT DATE_ (A) Obligations of the Parties Prior to the
Commencement Date_ The parties acknowledge that the Disposal Agreements may be executed and delivered
on different dates and that, except as provided in this subsection, neither the County nor the City shall be
obligated to perform its obligations hereunder until the participation threshold provided herein has been met and
the other conditions to the occurrence of the Commencement Date have occurred. Prior to the Commencement
Date, each party hereto shall at itstown expense exercise good faith and due diligence and take all steps within
its reasonable control in seeking t /satisfy the conditions to the Commencement Date set forth herein as soon as
reasonably practicable The Co ty and the City, each at its own expense, shall cooperate fully with each other
and the other Participating Cit s in connection with the foregoing undertaking.
Execution Copy 30 (Revised Page)
Page 10 - Council/Agency Agen1193117197 . (10)
F. Administrative Item$
F-1. Eii'.Sy Coun_Qjl)_ApprQy_PI Of Waste Dino sall Aar Qment With County Of
Grange -Waste Flow Contr -pro Of Franchise Hauli;r.lAi;;kn_QvAed men
With Rainbow Disposal - In reduction Of Ordinance No. 3349 - Approving
$-uppLem-c_ntaE Agreement No. 2 To_ Refusg,CQjjpegtion And Disposal Franchise
reem_ent_1 - th Rainbow Di5,p.Q (600.45)
Communication from the Assistant City Administrator regarding the following issue.
The cities in Orange County and the county itself are interested in maintaining public
ownership of the landfill disposal system. In order to assure this, the county is working
to contain their costs and establish adequate and predictable revenues to pay their bills.
The cities in the county are working to establish predictable gate fees at the lowest
possible cost for disposing of solid waste coming from their respective cities. The
purpose of this agreement is to attain these objectives_ OtheRvise the county will
pursue consideration of sale of the landfill system.
Recommended Action: Motion to:
1. Approve and authorize the Mayor and City Clerk to execute the Supplemental
Agreement No. 2 to Refuse Collection And Disposal Service Franchise Agreement
between the County of Orange and the City of Huntington Beach.
AND
2. Approve and authorize the Mayor and City Clerk to execute the Waste Flow
Control/Approval of Franchise Hauler Acknowledgment between the City of
Huntington Beach and Rainbow Disposal and Rainbow Transfer and Recycling
Companies.
AND
3. Approve Introduction of Ordinance No. 3349, after a reading by title by the City
Clerk - "An Ordinance Of The City Of Huntington Beach Amending The Franchise Of
Rainbow DisposallRainbotv-Disposai/Rainbow Transfer And Recycling Companies
To Collect Refuse." - (Approves Supplement No. 2 to Refuse Collection and
Disposal Services Franchise Agreement by and between the City of Huntington
Beach and Rainbow Disposal and Rainbow Transfer and Recycling Companies) and
authorize the Mayor and City Clerk to execute same.
[Approved 1, 2, 3 -- 7-0 -- Approved Introduction 7-0 to be presented for
Adoption 417197]
F-2. (may Council) Status R agrt_Qn_Qp!sa Chica Sgr Deliver Issues (440.60) -
Communication from the City Administrator, Fire Chief, Library Director, Public Works
Director and Police Chief submitting a status report on the Library, Fire, Police and
Public Works (including water and sewer) service delivery issues, responses to the
water service questions raised at the February 24, 1997 council meeting and a
re -affirmation on the City Council's direction regarding pursuit of the service
agreements.
RDc,_c_r_nmended Action. Motion to-
1. Direct the City Administrator, or his designee, to continue negotiations with Koll Real
Estate Group and the Orange County Fire Authority on the Fire service agreement;
[Approved -- 5-2 (Harman, Sullivan -- NO)]
•Ir
(10)
WASTE DISPOSAL AGREEMENT
Between
THE COUNTY OF ORANGE, CALIFORNIA
and
CITY OF HUNTINGTON BEACH
Dated _�, 1997
County Authorization Date:
r
County Notice Address:
Director
INTEGRATED WASTE MANAGEMENT DEPARTMENT
320 N. Flower Street, Suite 400
Santa Ana. CA 92703
City Authorization Date:
-S-r7- 57
City Notice Address
.._0 f- +h e- k (.00 .ys�
0
RECITALS
TABLE; OF CONTEN'I'S
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1 I I .EHNITIONS
SECTION 1 2 INTERPRETATION
ARTICLE 11
RI PRESENTATIONS AND WARRANTIES
P nc
3
9
SECTION 2 1 REPRESENTATIONS AND WARRANTIES OF THI: CITY .... 1 1
SECTION 2.2 REPRESENTATIONS AND WARRANTIES OF THE COUNTY 1 1
ARTICLE III
DELIVERY AND ACCEPTANCE OF WASTE
AND PROVISION OF DISPOSAL SERVICE
SECTION 3.1.
DELIVERY OF WASTE . ..... ......
12
SECTION 3.2.
PROVISION OF DISPOSAL SERVICES BY THE COUNTY ..... ........
14
SECTION 3.3-
COUNTY RIGHT TO REFUSE WASTE.._
15
SECTION 3.4.
UNINCORPORATED AREA ACCEPTABLE WASTE
16
SECTION 3-5.
MISCELLANEOUS OPERATIONAL MATTERS
16
SECTION 3-6.
OTHER USERS OF THE DISPOSAL SYSTEM ..
17
SEECTION 3 7.
COUNTY PROVISION OF WASTE DIVERSION SERVICES ... .........
18
ARTICLE IV
CONTRACT RATE
SECTION 4.1 CHARGING AND SECURING PAYMENT OF
CONTRACT RATE - - - ... - - . - ... 19
SECTION 4.2- CONTRACT RATE ... . _ . _ . _ _ 19
SECTION 4.3, RESPONSIBILITY FOR PAYMENT OF THE CONTRACT RATE 24
SECTION 4.4. BILLING OF THE CONTRACT RATE 25
SECTION 4.5. RESTRICTED RESERVES .......... ..... 25
SECTION 4_6 AUDITED FINANCIAL STATEMENTS 26
SECTION 4 7 ANNUAL UPDATE OF TEN-YEAR FINANCIAL PROJECTION. 26
ARTICLE V
BREACH, ENFORCEMENT AND TERMINATION
SECTION 5.1 BREACH 28
SECTION 5 2 CITY CONVENIENCE TERMINATION 28
SECTION 5 3 TERMINATION . 28
SECTION 5 4 NO WAIVERS 29
SECTION 5.5 FORUM FOR DISPUTE RESOLUTION ... 29
e
i
ARTICLE VI
TERM
Ea e
SECTION G 1 EFFECTIVE DATE AND TERM 30
SECTION 6 2 COMMENCEMENT DATE 30
ARTICLE VII
GENERAL PROVISIONS
SECTION 7 1.
OPERATION AND MAINTENANCE OF THE DISPOSAL SYSTEM .
32
SECTION 7.2
UNCONTROLLABLE CIRCUMSTANCES GENERALLY ..
32
SECTION 7 3
INDEMNIFICATION . .........
32
SECTION 7 4.
RELATIONSHIP OF THE PARTIES .
33
SECTION 7.5_
LIMITED RECOURSE .. .. _ .. _ ..
33
SECTION 7.6_
PRE-EXISTING RIGHTS AND L_IABILITI_ES ... ....
33
SECTION 7.7.
NO VESTED RIGHTS . .... ... ...
33
SECTION 7.8.
LIABILITY FOR COLLECTION, TRANSPORTATION AND PROCESSING
34
SECTION 7.9.
NO CONSEQUENTIAL OR PUNITIVE DAMAGES
34
SECTION 710.
AMENDMENTS ....... . .. . ..... . . _ _ .... ....
34
SECTION 7 11.
NOTICE OF LITIGATION . ... _ .. _ .. ... _ ..
34
SECTION 7,12,
FURTHER ASSURANCES ... . .. _ .. .....
34
SECTION 7.13_
ASSIGNMENT OF AGREEMENT ...... . . ...... ...
34
SECTION 7.14_
INTEREST ON OVERDUE OBLIGATIONS_ . , .
34
SECTION 7.15_
BINDING EFFECT . _ .. . .
34
SECTION 7 16
NOTICES . . _ _ .. . .. _ .. .. _ „
35
APPENDIX 1
ESTIMATED ANNUAL TONNAGE,
APPENDIX 2
CUMULATIVE TONNAGE TARGETS
APPENDIX 3
FORM OF HAULER ACKNOWLEDGEMENT
WASTE DISPOSAL AGREEMENT
THIS WASTE DISPOSAL AGREEMENT is made and dated as of the date indicated on the
cover page hereof between the County of Orange, a political subdivision of the State of California (the "County"),
acid the City designated on the cover page of this Agreement, a general law or charter city and political
subdivision of the State of California (the "City")
RECITALS
'l lie County owns, manages and operates a sanitary landfill system for the disposal of municipal
solid waste generated by the cities and the unincorporated area within the County (the "Disposal System") The
Disposal System includes four active landfills and four regional household hazardous waste collection centers
The Disposal System is used for the disposal of municipal solid waste which is not reused, recycled or
otherwise diverted from landfill disposal, pursuant to the California Integrated Waste Management Act of 1989
(Division 30 of the California Public Resources Code). The Act, which mandates the diversion of 50% of waste
from landfill disposal by 2000, has already significantly reduced the volume of waste delivered to the landfills
The Disposal System, which was designed to accept approximately 16,000 tons of waste per day, now receives
on average less than 10,000 tons per day of Orange County waste. The reduction in tonnage disposed reduced
revenues to the system at the same time that federal and stage statutes and regulations mandated the installation
of costly infrastructure at the landfills to protect air and water.
Based on reduced revenues and increased costs, the County was actively exploring opportunities to
remedy the shortfall when the bar&7Wtcy occurred. The impact of the County's bankruptcy petition in December
1994 precipitated a series of profound changes because the Disposal System was identified as one of the County's
most valuable assets- These changes included importation ofout-0f-County waste to raise revenues, restructuring
the department like a business enterpnse to reduce costs and operate more efficiently, and development of a
strategic study of the options available to the County for the future use or disposition of the system.
In January 1996, the County began accepting out -of -County municipal solid waste for disposal in the
Disposal System in order to utilize the unused landfill capacity to raise revenues to assist in bankruptcy recovery -
Contracts for disposal of unportod waste are intended to produce net revenues of $15 million per year for twenty
(20) years, which revenues are committed to the County's Plan of Adjustment for bankruptcy recovery
In March 1996, the Integrated Waste Management Department (%WMD") began implementing a
departmental restructuring plan focused on reducing overhead charges and costs applied by other County
department/agencics that provide support services to IW ID, reducing the contract services costs through
performance -based contract practices, and reducing staff costs identified in the internal department
reorganization In addition, IWMD continued to work with the Solid Waste Working Group ("SWWG") of the
City Managers Association ("CMA") and the Orange County Division of the League of California Cities
("LOCC") to resolve city issues and concerns regarding their future use of the Disposal System
To assist in determining the future use of the Disposal System, the County engaged the services of
independent consultants to identify and study available options for disposition of the Disposal System On
November 20, 1996, the Orange County Board of Supervisors considered the consultant's report and based on
recommendations from the cities and waste haulers, directed the IWMD to commence negotiations to secure
mutually acceptable long-term disposal contracts with Orange County cities and return within 90 days
Exeuiiion Cop) I (Rcviscd rage)
• 0
In dtrwing this action, the Board recognized the cities' interest in the procurement of competitive and
stable disposal fees, the assurance of long term capacity, and the continuation of sound environmental
management of the landfill system. In order to assure these goals, the County requires long tern, financially
sound, disposal contracts with the cities Long-term disposal contracts between the County and Orange County
cities will also serve the public health, safety and welfare of the residents of Orange County by maintaining public
o%%mcrship and stewardship over the Orange County Landfill Disposal System
The City, in the exercise of its police power and its powers under the Act, has entered into a
franchise or other agreement with or issued permits or licenses to one or more private haulers for the collection
and disposal of municipal solid waste generated within the City
The significant portion of murucipal solid waste generated within the City historically has been
and currently is delivered by such hauler or haulers to the County for disposal in the Disposal System
The City has determined that the execution of this Agreement by the City will serve the public
health, safety and welfare of the City by providing greater disposal rate stability, more predictable and reliable
long-term disposal service, and the continuation of sound environmental management
The County has determined that the execution by the County of this Agreement will serve the
public health, safety and welfare by providing a more stable, predictable and reliable supply of municipal solid
waste and the resulting service payment revenue to the Disposal System, thereby enabling the County to plan,
manage, operate and finance improvements to the Disposal System on a more prudent and sound long term,
businesslike basis consistent with its obligations to the State and the holders of obligations securers by its
Disposal System.
The City and the County acknowledge that execution of this Agreement will result in significant
cost savings for the residents of the County. The tipping fee currently charged for the disposal of solid waste at
the Disposal System is $27 per ton If this Agreement is executed by a sufficient number of cities, the Agreement
provides for a Contract Rate of $22 per ton, effective July 1, 1997.
Official action approving this Agreement and determining it to be in the public interest and
authorizing its execution and del ivery .was duly taken by the County on the County authorization date indicated
on the cover page hereof
Official action approving this Agreement and determining it to be in the public interest and
authorizing its execution and delivery was duly taken by the City on the City authorization date indicated on the
cover page hereof
It is, therefore, agreed as follows -
Execution Copy
ARTICLE I
DEFINITIONS' AND INTERPRETATION
SECTION I I DEFINITIONS As used in this Agreement, the following terms shall have the
meanings set forth below
"Acceptable Waste" means all garbage, refuse, rubbish and other materials and substances
discarded or rejected as being spent, useless, worthless or in excess to the owners at the time of such discard or
rejection and which are normally disposed of by or collected from residential (single family and multi -family),
commercial, utdu_strial, governmental and institutional establishments which are acceptable at Class III landfills
under Applicable Law
"Act" means the California Integrated Waste Management Act of 1989 (Division 30 of the
California Public Resources Code), as amended, supplemented, superseded and replaced from time to time
"Agreement" means this Waste Disposal Agreement between the County and the City as the
same may be amended or modified from time to time in accordance herewith.
"Annual Imported Tonnage Target" means the amount of Imported Acceptable Waste specified
in Appendix 2
"Appendix" means an appendix to this Agreement, as the same may be amended or modified
from time to tune in accordance with the terms hereof.
"Applicable Law" means the Act, the Orange County Code, CERCLA, RCRA, CEQA, any
Legal Entitlement and arty federal or state rule, regulation, rcquircmen% guideline, permit, action, determination
or order of any Governmental Body having jurisdiction, applicable from time to time to the siting, design,
permitting, acquisition, construction, equipping, financing, ownership, possession, operation or maintenance of
the Disposal System, the transfer, handling, transportation and disposal of Acceptable Waste, Unacceptable
Waste, or any other transaction or matter contemplated hereby (including any of the foregoing which concern
health, safety, fire, environmental protection, mitigation monitoring plans and building codes ).
"Board" means the California Integrated Waste Management Board.
"CEQA" means the California Environmental Quality Act, codified at Cal Pub. Res. Code
Section 21000 et seg. (West 1996) as amended or superseded, and the regulations promulgated thereunder.
"CERCLA" means the Comprehensive Environmental Responsibility Compensation and
Liabihty Act, 42 U_S C A_ Section 9601 et se . (West 1995 & Supp 1996, as amended or superseded, and the
regulations promulgated thereunder.
"Change in I.aw" means any of the following events or conditions which has a material and
adverse effect on the performance by the parties of their respective obligations under this Agreement (except for
payment obligations), or on the siting, design, permitting, acquisition, constriction, equipping, financing,
ownership, possession, operation or maintenance of the Disposal System or ether matters to which Applicable
La%v applies.
FAcculion Copy
(1) the enactment, adoption, promulgation, issuance, material modification or writtcri
change in admirustrative or judicial interpretation on or after the Commencement Date of any Applicable
Law (other than Applicable La%v- enacted by the County),
(2) the order or Judgment of anv Governmental Body (other than the County), on or after
the Commencement Date, to the extent such order or judgment is not the result of willful or negligent
action, error or omission or lack of reasonable diligence of the County or of the City, whichever is
asserting the occurrence of a Change in Law, pgovided, however, that the contesting in good faith or the
failure in good faith to contest any such order orjudgment shall not constitute or be construed as such
a .willful or negligent action, error or omission or lack of reasonable diligence, or
(3) the denial of an application for, delay in the review, issuance or renewal of, or
suspension, termination, interruption, imposition of a new or more stringent condition in connection with
the issuance, renewal or failure of issuance or renewal on or after the Commencement Date of any I.cgal
Entitlement to the extent that such denial, delay, suspension, termination, interruption, imposition or
failure materially and adversely interferes with the performance of this Agreement, if and to the extent
that such denial, delay, suspension, termination, interruption, imposition or failure is not the result of
willful or negligent action, error or omission or a lack of reasonable diligence of the County or of the
City, whichever is asserting the occurrence of a Change in Law; Lc vided, however that the contesting
in good faith or the failure in good faith to contest any such denial, delay, suspension, termination,
interruption, imposition or failure shall not be construed as such a willful or negligent action, error or
omission or lack of reasonable diligence.
"City" means, as applicable, the city or Sanitary Distract designated on the cover page of this
Agreement and party to this Agreement.
"City Acceptable Wane" means all Acceptable Waste which was originally discarded by the first
generator thereof within the geographical limits of the City, and Residue from the foregoing wherever produced,
whcdxx within or outside the City (or Tonnage equivalencies of such Residues, as and to the extent provided in
subsection 3.1(C) hereof)_
"Commencement Date" means the date on which the obligations of the parties hereto commence,
established as provided in Section 6.2(B) hereof
"Contract Date" means the date of delivery of this Agreement as executed by the parties hereto
"Contract Rate" has the meaning specified in Section 4.2 hereof_
"Contract Year" means the fiscal year cor menning on July l in any year and ending on June 30
of the following year
"Controllable Waste" means all City Acceptable Waste with respect to which the City has the
legal or contractual ability to determine the disposal location therefor and which is-
(1) Non -Recycled City Acceptable Waste,
(2) not generated from the operations of the Governmental Bodies which, wider Applicable
I.aw, have the independent power to arrange for the disposal of the waste they generate. and
(3) collected and hauled by Franchise Haulers
Gxccuiion Copy 4 (Revised Pagc)
0
E
"County" means the County of Orange, a political subdivision of the State of California and
party to this Agreement.
"County Plan" means the integrated waste management plan of the County approved by the
Board pursuant to the Act as in effect from time to time.
"County Acceptable Waste" means Acceptable Waste generated in the County.
"County Waste Management Enterprise fund" means the waste management enterprise fund
established and managed by the County pursuant to Section 25261 of the Government Code separate from its
other funds and accounts for receipts and disbursements w connection with the Disposal System.
"County -wide Recycling Services" has the meaning set forth in subsection 3_7(A) hereof.
"Cumulative Tonnage Target' for any given Contract Year means the amount specified in
Appendix 2 hereto with respect to such Contract Year_
"Department" means the Orange County Integrated Waste Management Department, and any
agency, department or other Governmental Body which succeeds to the duties and powers thereof_
"Disposal Agreeriwnts" means each of the waste disposal agreements entered into between the
County and any city within the County in accordance herewith_
"Disposal Services" means the solid waste disposal services to be provided by the County
pursuant to the Service Covenant and otherwise hereunder_
"Disposal System" means the Orange County Waste Disposal System wfuch includes solid waste
disposal operations at four active landfills (Olinda Alpha, Frank R. Bowerman, Prima Deshecha and Santiago);
four regional Household Hazardous Waste Collection Centers, as well as services, such as monitoring and other
activities, at refuse stations formerly operated by the County, as appropriate under Applicable Law.
"Environmental Fund" means the fund or funds held by the County to pay unanticipated costs
of environmental mitigation, remediation or liability_
"Excess Import Revenues" has the meaning ascribed thereto in Section 3.6(E)_
"Franchise Hauler" means any hauler or collector who provides Acceptable Waste collection
services within the City pursuant to, or under authority granted by, a contract, franchise or other agreement with
the City. The term Franchise Hauler includes the City itself if Acceptable Waste collection and transportation
services are provided directly by City operated municipal collection service_
"Govarrinienwl Body" means any federal, State, county, city or regional legislative, executive,
judicial or other governmental board, agency, authority, commission, administration, court or other body, or any
officer thereof acting within the scope of his or her authority
"Hazardous Substance" has the meaning given such terra in CERCLA, the Carpenter -Presley -
Tanner Hazardous Substance Account Act (California Health and Safety Code Section 25300 et seg.) (West 1992
E'Xccution copy 5 (Revised Page)
& Supp 1996), and Titles 22 and 26 of the California Code of Regulations and other regulations promulgated
thereunder
"llazardous Waste" means (a) any waste which by reason of its quality, concentration,
composition or physical, chemical or infectious characteristics may do either of the following cause, or
significantly contribute to, an increase in mortality or an increase in serious irreversible, or incapacitating
reversible, illness, or pose a substantial threat or potential hazard to human health or the environment, or any
waste which is defined or regulated as a hazardous waste, toxic substance, hazardous chemical substance or
mixture, or asbestos under Applicable Law, as amended from time to time including, but not limited to (1) the
Resource Coriservation and Recovery Act and the regulations contained in 40 CFR farts 260-281, (2) the Toxic
Substances Control Act (15 U S.C. Sections 2601 et seq ) and the regulations contained in 40 CFR Parts
761-766, (3) the California Health and Safety Code, Section 25117 (West 1992 & Supp 1996), (4) the
California Public Resources Code, Section 40141 (West 1996); and (5) future additional or substitute Applicable
I,aw pertaining to the identification, treatment, storage or disposal of toxic substances or hazardous wastes, or
(b) radioactive materials which are source, special nuclear or by-product material as defined by the Atomic
Energy Act of 1954 (42 U SC Section 2011 ct seq ) and the regulations contained in 10 CFR Fart 40
"Imported Acceptable Waste" means Acceptable Waste that is generated outside of the
geographical boundaries of the County and delivered to the Disposal System_
"Independent Haulers" means those waste colleetion/haulcr companies primarily engaged as a
principal business in the collection and transportation of municipal solid waste generated in the County of Orange
and not under a franchise or other contract with a city in the County.
"Initial Term" has the meaning specified in Section 6. I(A) hereof.
"Legal Entitlement" means all permits, licenses, approvals, authorizations, consents and
entitlements of whatever kind and however described which are required under Applicable Law to be obtained
or maintained by any person with respect to the Disposal System or the performance of any obligation under this
Agreement or the matters covered hereby_
"Legal Proceeding" means every action, suit, litigation, arbitration, administrative proceeding,
and other legal or equitable proceeding having a beanng upon this Agreement.
"Loss -and -Expense" means any and all loss, liability, obligation, damage, delay, penalty,
judgment, deposit, cost, expense, claim, demand, charge, tax, or expense, including all fees and costs
"Non -Recycled City Acceptable Waste" means all City Acceptable Waste other than Recycled
City Acceptable Waste
"Overdue Rate" means the maximum rate of interest permitted by the laws of the State, if
applicable, or the prime rate established from time to time by the Sank of America, N A. or its successors and
assigns, plus 2%, whichever is lower
"Participating City" means any city or Sanitary District executing a Disposal Agreement in
accordance with Section 3.6(A) hereof and meeting all requisite conditions to the Commencement Date thereof
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"Nan of Adjustment" ineans the County's Plan of Adjustment as approved by the County Board
of Supervisors in August, 1995
"Posted Disposal Rate" means the per ton tipping fee charged by the County for the disposal
of solid waste at the Disposal System by parties which are not entitled to disposal service at the Contract Rate
pursuant to this Agreement
"Prohibited Medical Waste" means any medical or infectious waste prohibited or restricted under
Applicable Lain from being received by or disposed at the Disposal System
"Qualified Household I lazardous Waste" means waste materials determined by the Board, the
Department of Health Services, the State Water Resources Control Board, or the Air Resources Board to be-
(1) Of a nature that they must be listed as hazardous in State statutes and regulations;
(2) 'toxic/ignitab le/corrosIve/reactive, and
(3) Carcinogenic/mutagenidtcratogenic,
which are discarded from households as opposed to businesses. Qualified Household I Iaxardous Waste shall not
include Unacceptable Waste
"Recycled City Acceptable Waste" means any otherwise Controllable Waste which is separated
from Acceptable Waste by the generator thereof or by processing and which is "recycled" within the mcaiung of
Section 40180 of the Public Resources Code
"Renewal Term" has the meaning specified in Subsection 6.1(B) hereof
"Residue" means any material remaining from the processing, by any means and to any extent,
of City Acceptable Waste or Recycled City Acceptable Waste; provided, however, that Residue shall not include
minimal amounts of material remaining after such processing (which minimal amounts shall in no event exceed
10%of the amount of such City Acceptable Waste or Recycled City Acceptable Waste prior to processing).
"Resource Conservation and Recovery Act" or "RCRA" means the Resource Conservation and
Recovery Act, 42 U_S_C.A. Section 6901 ct seq- (West 1993 & Supp 1989). as amended and superseded.
"Restricted Reserves" has the meaning specified in Section 4 5
"Sanitary Districts" means the sanitary districts in the County formed pursuant to the Sanitary
District Act of 1923, codified at Cal. Ann. Health & Safety Code Section 6400 et seq (West 1970 & Supp.
1996), as amended, supplemented, superseded and replaced from time to time.
"Self -Hauled Waste" means City Acceptable Waste collected and hauled by Self -Haulers
"Self Haulcr" means any person not engaged commercially in waste haulage who collects and
hauls Acceptable Waste generated from residential or business activities conducted by such person
"Service Coordinator" means the service coordinator for either party designated pursuant to
subsection 3.5(C) hereof
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"Service Covenant" means the covenants and agreements of the County set forth in Sections 1 2
and 3 3 hereof.
"Source -Separated Household Hazardous Waste" means Qualified Household Iazardous Waste
which has been segregated from Acceptable Waste originating or generated within the geographical jurisdiction
of the City at the source or location of generation
"Source -Separated Household I la/ardous Waste Disposal System" means the collection centers,
facilities, contracts and other arrangements o%%med or administered by the County for the receipt. handling and
disposal of Source -Separated Household Hazardous Wastc.
"State" means the State of California
"Term" shall mean the Initial Term of this Agreement
"•f on" means a "short ton" of 2,000 pounds.
"Transfer Station" means any materials recovery facility, composting facility, intermediate
processing facility, recycling center, transfer station or other waste handling or management facility to which solid
waste collected for the City is delivered for processing before disposal in the Disposal System
"Unacceptable Waste" means Hazardous Waste; Hazardous Substances, Prohibited Medical
Waste, Quahfied Household Hazardous Waste separated from Acceptable Waste, explosives, ordnance, highly
flanunable substances, and noxious materials and lead -acid batteries (except if delivered in minimal quantities),
drums and closed containers; liquid waste, oil, human wastes; machinery and equipment from commercial or
industrial sources, such as hardened gears, shafts, motor vehicles or major components thereof, agricultural
equipment, trailers, marine vessels and steel cable; hot loads; and any waste which the Disposal System is
prohibited from receiving under Applicable Law.
"UncontroBable Circuuristance" means any act, event or condition affecting the Disposal System,
the County, the City, or any of their Franchise Haulers, contractors or suppliers to the extent that it materialhy and
adversely affects the ability of either party to perform -any obligation under the Agreement (except for payment
obligations), if such act, event or condition is beyond the reasonable control and is not also the result of the willful
or negligent act, error or omission or failure to exercise reasonable diligence on the part of the party relying
thereon as justification for not performing an obligation or complying with any condition required of such party
under the Agreement; provided, however, that the contesting in good faith or the failure in good faith to contest
such action or inaction shall not be construed as willful or negligent action or a lack of reasonable diligence of
either party- Examples of Uncontrollable Circumstances are:
(1) an act of God, landslide, lightning, earthquake, fire, explosion, flood, sabotage or
similar occurrence, acts of a public enemy, extortion, war, blockade or insurrection, riot or civil
disturbance, and
(2) a Change in Law
"Unincorporated Area" means those portions of the County which are not contained within the
jurisdictional boundaries of incorporated cities
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"Unincorporated Area Acceptable Waste" means Acceptable Waste originating from or
generated within the Unincorporated Area
"Unrestricted Reserves" means cash and other reserves of the Disposal System which are not
Restricted Reserves
3 1 hereof.
"Waste Disposal Covenant" means the covenants and agreements of the City set -forth in Section
SECTION 12 NTERPKETATION In this Agreement, unless the context othen4ise requires
(A) References If The terms "hereby", "hereof', "herein", "hereunder" and any similar
terms to this Agreement, and the temi "hereafter" means after, and the term "heretofore" means before, the
Contract Date
(B) Gender and Plurality. Words of the masculine gender mean and include correlative words
of the ferriinine and ncut.er genders and words importing the singular number mean and include the plural number
and vice versa
(C) Persons Words importing persons include firms, companies, associations, general
partrx.rships, limited partnerships, trusts, business trusts, corporations and other legal entities, including public
bodies, as well as individuals-
(D) 1(eadingq. The table of contents and any headings preceding the text of the Articles,
Sections and subsections of this Agreement shall be solely for convenience of reference and shall not constitute
a part of this Agreement, nor shall they affect its meaning, construction or effect-
(E) Entire A nt. This Agreement contains the entire agreement between the parties hereto
with respect to the transactions contemplated by this Agreement and, except as expressly provided otherwise
herein, nothing in this Agrcenwat is intended to confer on haulers or airy other person other than the parties hereto
and their respective permitted successors and assigns hereunder any rights or remedies under or by reason of this
Agreement
(F) Coun ails This Agreement may be executed in any number of original counterparts_ All
such counterparts shall constitute but one and the same Agreement.
(G)Applicable Law. This Agreement shall be governed by and construed in accordance with
the Applicable Laws of the State of California.
(H) Scverabi]ity If any clause, provision, subsection, Section or Article of this Agreement shall
be ruled invalid by any court of jurisdiction, then the parties shall: (1) promptly meet and negotiate a substitute
for such clause, provision, subsection, Section or Article which shall, to the greatest extent legally permissible,
effect the intent of the parties therein, (2) if necessary or desirable to accomplish item (1) above, apply to the
court having declared such invalidity for a judicial construction of the invalidated portion of this Agreement, and
(3) negotiate such changes in, substitutions for or additions to the remaining provisions of this Agreement as may
be necessary in addition to and in conjunction with items (1) and (2) above to effect the intent of the parties in
the invalid provision The invalidity of such clause, provision, subsection, Section or Article shall not affect any
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ofthe remauung provisions hereof, and this Agreement shall be construed and enforced as if such invalid portion
did not exist, unless such invalidity frustrates the underlying primary purpose of the Agreement
(1) Integration; Preservation of Certain AjZreements This Agreement contains the entire
agreement between the parties with respect to the transactions contemplated hereby This Agreement shall
completely and fully supersede all prior understandings and agreements between the Parties with respect to such
transactions; provided, however, that this Agreement shall not supersede the following agreements-
1) MOU, dated March 10, 1992, between the City of Brea and the County of Orange regarding
the Olinda Alpha Landfill as amended on April 6, 1993 and November 29, 1994
2) MOU, dated May 11, 1995, between the City of Brea and the County of Orange regarding
importation of out -of -County waste to the Olinda Alpha Landfill
3) Settlement Agreement, dated August 1, 1984, between the City of Irvine and the County of
Orange regarding the Bee Canyon Landfill (currently called Frank R- Bowerman Landfill)
4) MOU, dated May 16, 1995, between the City of Irvine and the County of Orange regarding
importation of out -of -County waste to the Frank R. Bowerman Landfill
5) MOU, dated September 12, 1995, between the City of San Juan Capistrano and the County
of Orange regarding importation of out -of -County waste to the Prima Deshecha Landfill
6) MOU, currently under negotiation, between the City of San Clemente, the Orange County
Flood Control District and the County of Orange regarding the Prima Deshe cha Landfill
(J) Recitals_ The recitals to this Agreement are not intended to bind the parties hereto. In the
event of a conflict between the recitals and the operative provisions of this Agreement, the operative provisions
shall prevail. The recitals shall not be used to interpret the provisions of the Agreement.
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ARTICLE 11
RI:I'RI':SF,N"TA"!'IONS AND WARRANTIES
SECTION 2 1 REPRESENTATIONS AND WARRANTIES OF TUR CITY_ The City
represents and warrants that
(A) Fxrstenc_e The City is a general law or charter city validly existing under the Constitution
and la%as of the State
(13) Due Authorization. The City has duly authorized the execution and delivery of this
Agreement, and this Agreement has been duly executed and delivered by the City
SF,CTION 2.2 REPRESENTATIONS AND WARRANTIIF.S OF TFIE COUNTY The County
represents and warrants that
(A) Existence_ The County is a political subdivision of the State of California validly existing
under the Constitution and laws of the State.
(B) Due Authorization The County has duly authorized the execution and delivery of this
Agreement, and this Agreement has been duly executed and delivered by the County.
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ARTICLE III
DELIVERY AND ACCEPTANCE OF WASTE
ANI) PROVISION OF DISPOSAL SERVICE-.
SECTION 3 1 DELIVERY OF WASTE (A) Waste Disposal Covenant. Subject to the occurrence
of the Commencement Date and throughout the Term of this Agreement, the City shall exercise all legal and
contractual power and authority which it may possess from time to time to deliver or cause the delivery of all
Controllable Waste to the Disposal System in accordance herc%vith be inning on July 1, 1997
(B) Recycled City cq�t ble Waste The parties hereto acknowledge the responsibility
of the City to meet the recycling and landfill diversion goals contained in the Act Nothing to this Agreement is
intended or shall be interpreted to prohibit or impair the ability of the City to meet such responsibilities, or to
restrict the right of the residents, businesses or organizations in the City to practice source separation, recycling,
composting or other materials recovery activities, or to restrict the right of the City to conduct, sponsor, encourage
or require such activities in any form. No reduction in the amount of Controllable Waste generated in the City
and delivered to the Disposal System by or on behalf of the City which may result from any such source
separation or recycling program shall cause the City any liability hereunder (other than potential adjustment to
the Contract Rate to the extent provided in Article IV hereof) and shall not constitute a breach of this Agreement
(C) Waste Delivered to Transfer Station All Residue from any processing of Controllable
Waste by materials recovery, composting, recycling or other means, wherever performed, shall constitute
Controllable Waste and be subject to the Waste Disposal Covenant_ Where City Acceptable Waste is processed
at a facility which concurrently processes other Acceptable Waste in a manner which produces commingled
residue which cannot be traced to a geographic source, generic residues from such facility in Tonnage equal to
the residues that would have been produced had City Acceptable Waste only been processed at the facility shall
constitute Controllable Waste and be subject to the Waste Disposal Covenant_ Any City Acceptable Waste or
material derived or segregated therefrom which is held in storage and asserted by the possessor thereof to
constitute Recycled City Acceptable Waste awaiting sale or distribution to the secondary materials markets shall
constitute Controllable Waste if, when and to the extent that the storage or diversion thereof can be reasonably
deemed to constitute an evasion of the Waste Disposal Covenant rather than generally recogruzed, accepted and
prevailing practice in the Southern California materials recovery and recycling industry conducted in accordance
with Applicable Law_ In order for the owner and/or operator of a transfer station to be entitled to deliver
Acceptable Waste from a Participating City to the Disposal System for the Contract Rate as provided in Article
IV, such owner and/or operator must execute a direct agreement with the County, acknowledging and agreeing
to comply with the obligation of the Participating Cite to cause the delivery of all Controllable Waste to the
Disposal System pursuant to this Agreement. In addition, the County shall be authorized to implement procedures
to determine if Acceptable Waste delivered by the owners or operators of Transfer Stations is entitled to utilize
the Disposal System for the Contract Rate. Such procedures may include requiring Transfer Stations to certify,
under penalty of perjury, the source of any such Acceptable Waste If necessary, the County may require that, in
order to qualify for use of the Disposal System for the Contract Rate, Transfer Stations must deliver Controllable
Waste in loads containing only Controllable Waste, and not commingled with Acceptable Waste from entities
which are not Participating Cities or Participating Independent Haulers
(D) Power to Obligate Waste Disposal and Comply with this Agreement_ On or before Jul.
1, 1997, (1) any City franchise, contract, lease, or other agreement which is lawfully in effect relating to or
affecting Controllable Waste shall provide, or shall have been amended to provide, that the City shall have the
right without material restriction on and after the Commencement Date to direct the delivery of all Controllable
Waste to a disposal location selected by..the City (whether or not such Controllable Waste is delivered to a
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transfer station as an intermediate step prior to landfill disposal) and otherwise to comply with its obligations
under this Agreement with respect to Controllable Waste and Franchise Haulers, and (H) the City shall designate,
the Disposal System as the disposal location pursuant to such franchise, contract, lease or other agreement_ On
and after the Commencement Date and throughout the Term of this Agreement the City (a) shall not enter into
any franchise, contract, lease, agreement or obligation, issue any permit, license or approval, or adopt any
ordinance, resolution or law which is materially inconsistent with the requirements of the Waste Disposal
Covenant, and (b) shall maintain non-exclusive or exclusive franchises or other contractual arrangements over
any City Acceptable Waste which, as of the Contract Date, is subject to non-exclusive or exclusive franchise or
other contractual arrangements. The City agrees that the County shall be a third party beneficiary of the obligation
of Franchise Haulers to delivery Controllable Waste to the Disposal System, and may directly enforce such
obligation through any legal means available. The City shall notify in writing each Franchise Hauler of the
County's third party beneficiary rights-
(E) Waste Flow Enforcement. (I) The City, in cooperation with the Department, shall
establish, implement, carry out and enforce a waste flow enforcement program which is sufficient to assure the
delivery of all Controllable Waste to the Disposal System pursuant to and in accordance with the Waste Disposal
Covenant for disposal at the times and in the man= provided herein_ The waste flow enforcement program shall
consist of amending City franchises with all Franchise Haulcrs, to the extent required by this Section, and shall
include in addition, to the extent necessary and appropriate in the circumstances to assure compliance with the
Waste Disposal Covenant, but shall not be limited to: (i) licensing or permitting Franchise Haulers, upon the
condition of compliance with the Waste Disposal Covenant, (ii) providing for and taking appropriate enforcement
action under any such franchise, license, or permit, such as but not limited to the suspension, revocation and
termination of collection rights and privileges, the imposition of fines or collection of damages, and the exercise
of injunctive relief against non -complying Franchise Haulers and (iii) causing any Transfer Station to which
Controllable Waste is delivered for processing to deliver axtif cation, under the penalty of perjury, of the amounts
of Controllable Waste received and Residue remaining from processing at such Transfer Station. (2) The City
acknowledges and agrees that in the event of a breach of the Waste Disposal Covenant by the City, the City shall
pay the County an amount equal to the Contract Rate in effect at the time of such breach (or any higher rate with
respect to which the County has provided notice pursuant to Section 4.2(G)) multiplied by the number of tons
of City Acceptable Waste delivered to the Disposal System during the preceding twelve months (or, if the City
had been in breach of the Waste Disposal Covenant during such prior months, such amount as would have been
delivered if the City had complied with the Waste Disposal Covenant), multiplied by the number of years
remaining in the Term of the Agreement_ The parties recognize that if the City fails to meet its obligations
hereunder, the County will suffer damages and that it is and will be impracticable and extremely difficult to
ascertain and dctermine the exact amount of such damages. Therefore, the parties agree that the damages
specified above represent a reasonable estimate of the amount of such damages, considering all of the
circumstances existing on the date hereto, including the relationship of the sums to the range of harm to the
County that reasonably could be anticipated and anticipation that proof of actual damages would be costly or
inconvenient. In signing this Agreement, each party specifically confirms the accuracy of the statements made
above and the fact that each party had ample opportunity to consult with legal counsel and obtain an explanation
of this liquidated damage provision at the time that this Agreement was made.
(F) Legal Challenges to Franchise Sysicm. The City shall use its best efforts to preserve,
protect and defend its right to exercise and comply with the Waste Disposal Covenant against any challenge
thereto, legal or otherwise (including any lawsuits against the City or the County, whether as plaintiff or
defendant), by a Franchise I Iauler or any other person, based upon breach of contract, violation of law or any
other legal theory The City shall bear the cost and expense of any such Legal Proceeding or other challenge
In the event any such Legal Proceeding relating to the Waste Disposal Covenant or the City's exercise thereof
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establishes ►n a final determination that such covenant or exercise thereof is void, unlawful or unenforceable, or
if arty Franclusc I iaulcr fails to deliver Controllable Waste to the Disposal System in breach of its franchise with
the City on the grounds that a judicial determination made by any court or other Applicable Law has rendered
its obligation to deliver Controllable Waste to the Disposal System void, unlawful or unenforceable on any legal
grounds, %vith the result that actual waste deliveries to the Disposal System fall below the Cumulative Tonnave
Targets, the County shall be entitled to avail itself of the remedies described in Section 4.2(B) hereof
(G) Franchise Haulers. The City shall compile and provide the County with the following
information concerning all Franchisc Haulers: name, address and phone number, identification number; area of
collection and transportation; and franchise and permit terms
(11) Waste Information System. The City shall cooperate with the County in collecting
information and otherwise morutonng Franchise Haulers in order to assure compliance with this Agreement Such
information may include, to the extent practicable, data pertaining to Controllable Waste collected, transported,
stored, processed and disposed of, Recycled City Acceptable Waste collected, transported, stored, processed and
marketed or disposed of, Francluse Haulers' franchise, permit or license terms, collection areas, transportation
routes and compliance with Applicable Law; and all other information which may reasonably be requirr.44 by the
Department in connection with this Agreement
(I)City Actions Affecting County. The City agrees to carry out and fulfill its
responsibilities under this Agreement and Applicable Law so as to permit full and timely compliance by the
County with its covenants and agreements with the State. In particular, the City agrees not to conduct or permit
any disposal services for Controllable Waste to be provided in competition with the Disposal Services provided
by the County hereunder, and not to take or omit to take any action with respect to Controllable Waste or its
collection, transportation, transfer, storage, treatment or disposal that may materially and adversely affect the
County's ability to achieve such timely compliance. Notwithstanding the foregoing, the City shall not be required
to deny any permit or license or refuse to grant any approval while exercising its police powers
0) No Right of Waste Substitution- Nothing in this Agreement shall authorize or entitle
the City to deliver or cause the delivery to the Disposal System of Acceptable Waste originating from or
generated outside the jurisdiction of the City, nor obligate the County to receive or dispose of any such
Acceptable Waste_ The City shall not assign in whole or in part its right to deliver or cause to be delivered
Controllable Waste to the County hereunder, and shall not permit any Acceptable Waste originating from or
generated outside the jurisdiction of the City to be substituted for Controllable Waste for any purpose hereunder
(K) Annexations and Rcstructurina. It is the intention of the parties that this Agreement
and the obligations and rights of the City hereunder, including particularly the Waste Disposal Covenant and the
Contract Rate, shall, to the extent permitted by Applicable Law, extend to any territory annexed by the City (or
any territory with respect to which the City assumes, after March 30, 1997, solid waste management
responsibility from a sanitary district or other public entity) and shall bind any successor or restructured
Governmental Body which shall assume or succeed to the rights of the City under Applicable Law
SECTION 3.2 PROVISION OF DISPOSAL SL•RVICES BY THE COUNTY_
(A) Sin ice Covenant Commencing July 1, 1997, the County shall provide or cause the provision of the service
of (1) receiving and disposing of all Controllable Waste at the Disposal System (or such other facilities, including
transfer stations, as the County may determine to use), (2) disposing in accordance with subsection 3.2(C) hereof
of Controllable Waste which, at any time and for any reason, is in excess of the disposal capacity of the Disposal
System, and (3) in accordance with subsection 3.3(C) hereof, disposing of Unacceptable Waste inadvertently
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accepted at the Disposal System ']'he County, to the maximum extent permitted under Applicable Law. shall
use its best efforts to keep the Olinda Alpha, Prima Deshecha and Frank R Bowerman Landfills open for the
receipt of waste for disposal or transfer of Controllable Waste pursuant to this Agreement The County shall do
and perform all acts and things which may be necessary or desirable in connection with its covenants in this
subsection, including %,%-ithout limitation all planning. deveSopinent, administration, implementation, construction,
operation, maintenance, management, financing and contract work related thereto or undertaken in connection
therewith The County shall exercise all reasonable efforts to minimize the costs incurred in complying with the
Service: Covenant consistent with its responsibilities hereunder and under this Agreement, Applicable Law and
prudent solid waste management practice and environmental considerations
(B) Particular Facilities The Department and the City shall consult and cooperate in
detcnnirung whether and to %hat extent from time to time other landfills other than that primarily used by the City
shall be utilized to receive Controllable Waste The Department shall immediately advise the City by telephone
Of any situation, event or circumstance which results in the partial or complete inability of the County to receive
Controllable Waste at any particular landfill within the Disposal System, its effect on the County's ability to
perform its obligations hereunder, and the County's best estimate of the probable duration. The Department shall
confirm such advice in wnting within 24 hours of the occurrence of any such inability The County shall use, its
best efforts to resume normal operation of the landfill primarily used by the City as soon as possible in
accordance with subsection 3.2(C) hereof
(C) Compliance with Service Covenant not Excused for any Reason Commencing July 1,
1997, the obligations of the County to duly observe and comply with the Service Covenant shall apply
continuously and without interruption for the Term of this Agreement. In the event that any Change in Law or
other Uncontrollable Circumstance impairs or precludes compliance with the Service Covenant by the means or
methods then being employed by the County, the County shall implement alternative or substitute means and
methods to enable it to satisfy the terms and conditions of the Service Covenant. in the event that a Change in
Law precludes the County from complying with such covenants with the means or methods then being employed
and from utilizing any alternate or substitute means or methods of compliance, the County shall continuously use
all reasonable efforts to effectuate executive, legislative or Judicial change in or relief from the applicability of
such law so as to enable the County lawfully to resume compliance with such covenants as soon as possible
following the Change in Law
SECTION 3 3. COUNTY RIG] IT TO REFUSE WASTE
(A) Right of Refusal Notwithstanding any other provision hereof, the County may refuse delivery of
(1) Hazardous Waste,
(2) Controllable Waste delivered at hours other than those provided in Section 3 5 hereof.
(3) Waste that does not constitute Acceptable Waste; and
(4) Waste that is delivered by any party which has not executed a Waste Disposal
Agreement
(B) Identification of Unaccer)tabIc Waste The Department shall have the right (but not the duty
or the obligation) to inspect the vehicles of all Franchise Haulers delivering matenal to the Disposal System, and
may require that the Franchise Hauler remove any Unacceptable Waste from such vehicle before it is unloaded
If the Department determines that it is impractical: to separate Controllable Waste from Unacceptable Waste in
any vehicle, or if this Franchise Hauler delivering such waste is unwilling to make such separation, or if any
vehicle is cam.-ing waste µluch may spill or leak, then the Department may reject the entire vehicle, and the City
shall forthwith remove or cause the removal of the entire delivery from the Disposal System The Department may
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take all reasonable measures to prevent waste from being blown or scattered before and during unloading The
City shall cause the Franchise Haulers to observe and comply with Applicable Law, the operating rules and
regulations of the Department, and the provisions of this Agreement prohibiting the delivery of Unacceptable
Waste to the Disposal System
(C) Hazardous Waste and Hazardous Substances The parties acknowledge that the
Disposal System has not been designed or permitted, and is not intended to be used in any manner or to any
extent, for the handling, transportation, storage or disposal of Hazardous Waste or Hazardous Substances
Neither the County nor the City shall countenance or knowingly permit the delivery° of Hazardous Waste or
I azardous Substances to the Disposal System
(D) Disposal of Unacceptable Waste and Hazardous Waste If Unacceptable Waste or
Hazardous Waste is discovered in a vehicle at any landfill within the Disposal System, the driver of the vehicle
will not be permitted to discharge the load If a vehicle is observed unloading Unacceptable Waste or Hazardous
Waste in the tipping area of a landfill within the Disposal System Department personnel will use reasonable
efforts to assure that such material has been characterized, properly secured and its disposition resolved. The
return or reloading on to the delivery vehicle of any Hazardous Waste, Prohibited Medical Waste or other waste
requiring handling or transportation shall be conducted in accordance with Applicable Law_ Whenever
Iazardous Waste is detected at any landfill within the Disposal System, the Department shall take immediate
action in accordance with Applicable Law.
(E) Source: -Separated Household hazardous Waste. The County shall maintain, as part of
the Disposal System, a Source -Separated Household Hazardous Waste Disposal System for the disposal of
Source -Separated Household Hazardous Waste The disposal service provided by such system shall constitute
part of the Disposal Services, and shall be available to Participating Cities as part of the Contract Rate. The
County may impose additional fees and charges for services relating to Source -Separated Household Hazardous
Waste with respect to cities which are not parties to a Disposal Agreement The County may provide for the
expansion, contraction or modification of the Source -Separated Ilousehodd Hazardous Waste Disposal System
and its services to the extent necessary to caastue the Disposal System's viability, provided, however, if the County
chooses to reduce services, the County shall nonetheless continue to expend funds for the Source -Separated
Household Hazardous Waste Disposal System each year during the term of this Agreement in an amount at least
equal to the amount of funds -expended for the Source -Separated Household Hazardous Waste Disposal System
during fiscal year 1996-97 as adjusted by changes in the Producer Price Index
(F) Environmental Insurance. The County wrill explore the availability of insurance for
potential CERCLA or other environmental liability of the Disposal System, and will acquire such insurance to
the extent that such insurance is, in the judgment of the County, commercially available at a reasonable rate.
SECTION 3.4. UNINCORPORATED AREA ACCEPTABLE WASTE. Commencing July
1, 1997, the County in accordance with Applicable Law shall provide or cause to he provided the service of
disposing; of non -recycled Acceptable Waste originating or generated within the Unincorporated Area and, with
respect to such waste, shall comply with the Waste Disposal Covenant as if the County constituted a City subject
to the Waste Disposal Covenant hereunder_ Rates charged by the County for the disposal of each class of non -
recycled Acceptable Waste generated in the Unincorporated Area shall be the same as the Contract Fee charged
for the disposal of each class of Controllable Waste
SECTION 3 S MISCEIsLANF.OUS OPERATIONAL. MATTERS_ (A) Otxxatrn Hg ours The
County shall keep the Disposal System open for the receiving of Controllable Waste during such regular
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operating; hours as may be established by the Department in the operating rules and regulations applicable to the
Disposal System The County shall utilize best efforts to maintain substantially similar hours, as were in effect
on January 2, 1997, for the receipt of waste through the term of this Agreement (subject to Applicable Law)
(B) Scales and Weighinig The Department shall operate and maintain permanent scales at the
Disposal System The Department shall weigh all vehicles delivering waste by or on behalf of the City (whether
or not the County accepts such waste) and prepare a daily weight record with regard to such delivery
(C) Service Coordinator The Countv and the City each shall designate in writing thirty days
prior to the expected Commencement Date a person to transmit instructions, receive information and otherwise
cmdinate service matters arising pursuant to this Agreement (each a "Service Coordinator") Either party may
designate a successor or substitute Service Coordinator at any time by notice to the other party
(D) Review of Records Each party may review the other party's books and records with respect
to matters relevant to the performance by either party under this Agreement or otherwise related to the operation
of the Disposal System to the extent allowed under the California Public Records Act (interpreted as if the parties
to this Agreement were natural persons for purposes of the Public Records Act)
SECTION 3 fi. OTHER USERS OF THE DISPOSAL SYSTEM (A) On or Before June 30,
1997 On or before June 30, 1997, the County shall have the right to enter into waste disposal agreements with
other cities in the County, Sanitary Districts, Transfer Stations and Independent Haulers, to be effective on July
1, 1997, wluch waste disposal agreements shall have terms and provisions substantially identical to the terms and
provisions of this Agreement, provided, however, that in no event shall such agreements have terms and
provisions more favorable than the terms and provisions of this Agreement (including but not limited to the
Contract Rate and availability of disposal capacity).
(B) After June 30, 1997. After June 30, 1997, the County shall have the right to enter into waste
disposal agreements with any city, Sanitary District, Transfer Station and Independent Hauler, or otherwise accept
Acceptable Waste from such parties, but only within the limitations contained in this Section. Any such
agreement or waste acceptance agreement must provide that the party delivering waste shall pay a Posted
Disposal Rate at least 10% higher than the Contract Rate unless the County determines it is in the best interest
of the Disposal System to establish a Posted Disposal Rate less than 10% higher than the Contract Rate. In no
event shall the Posted Disposal Rate be equal to or less than the Contract Rate. In addition, the County shall
reserve the right in any such waste disposal agreement at any time, to the extent permitted by Applicable Law,
to refuse to receive and dispose of Acceptable Waste from any city, County Sanitary District, Transfer Station
and Independent Hauler if and to the extent that such receipt and disposal may materially and adversely affect
the ability of the County to comply with its obligations to the Participating Cities under the Disposal Agreements
to which each is a party_ Notwithstanding the foregoing, the County shall be permitted to enter into a Waste
Disposal Agreement with the City of Garden Grove in accordance with Section 3_6(A) if such Waste Disposal
Agreement is executed by the City of Garden Grove within 90 days after the date on which Garden Grove
assumes responsibility for solid waste collection within the City of Garden Grove
(C) Rex int of Imported Acceptable Waste on a Contract Basis The County shall have the
right to enter into a contract or other agreement with any municipal or private non -County entity for the delivery
of Imported Acceptable Waste on terms and conditions that the County determines to be necessary to ensure and
enhance the viability of the Disposal System for the benefit of the County and the Participating Cities The
County certifies that in its good faith Judgment the contract or other agreement for the delivery of such waste will
not matcnally and adversely affect the ability of the County to receive and dispose of Acceptable Waste frorn the
Participating; Cities in accordance with applicable the Disposal Agreements throughout the 'Term thereof
].xccutinn Copy 17
(D) Self Haulers. The City and the County acknowledge that Self -Haulers shall be entitled
to deliver Self -Hauled Waste to the Disposal System,`on a non -contract basis, at the Posted Disposal Rate_ Such
Self -Haulers shall not be entitled to dispose of Acceptable Waste for the Contract Rate.
(E) Application and Use of Revenues From Other Users, Excess Import Revenues. All
revenues received by the County from the disposal of County Acceptable Waste by the Disposal System, and all
revenues received by the County from the disposal of Imported Acceptable Waste by the Disposal System, shall
be deposited by the County in the County Waste Management Enterprise Fund and shall constitute revenues of
the Disposal System. Pursuant to the County's Plan of Adjustment, the County is entitled to receive net revenues
(after payment of all costs attributable to the acceptance of such Imported Acceptable Waste at the Disposal
System) from the disposal of Imported Acceptable Waste by the Disposal System in an amount of $15,000,000
per year. Costs attributable to the disposal of Imported Acceptable Waste include deposits to the Environmental
Fund, deposits to closure and postclosure reserves, City host fees (if applicable), incremental operating costs
(such as manpower expenditures, equipment, services and supplies expenditures), state surcharges, and a pro rata
share of capital project costs. All net revenues in excess of the $15,000,000 per year shall be considered "Excess
Import Revenues" and shall be (i) retained in the County Waste Management Enterprise Fund or (ii) deposited
in the County debt repayment reserve for future bond defeasance established by Resolution No. 96-473 of the
County Board of Supervisors on June 25, 1996 ("Debt Repayment Reserve"). Amounts from the Disposal System
so deposited in the Debt Repayment Reserve shall only be used for the purposes of repayment of County
bankruptcy related obligations and defeasance of bankruptcy related financings as set forth in the Debt
Repayment Policy approved pursuant to Resolution No. 96-473 unless the Board, by a four fifths majority vote,
determines to use such amounts for other purposes. The parties acknowledge that their intention in determining
to allow the importation of Imported Acceptable Waste for disposal by the Disposal System is to stabilize the
Contract Rate at rates below those which would otherwise prevail in the absence of such importation.
SECTION 3.7. COUNTY PROVISION OF WASTE DIVERSION SERVICES.
(A) County -Wide RpUcling Services. This Agreement does not require the County to provide for any source
reduction, materials recovery, recycling, composting, or other waste diversion services by the County nor any
payment therefor by the City, by Franchise Haulers or by ratepayers; provided, however, any County -Wide
Recycling Services may be funded through the County Waste Management Enterprise Fund. Any such recycling
services may be expanded, contracted or modified by the County at any time in'its sole discretion.
(B) Separate City -County Divbrsion Service Agreements. Nothing in this Agreement is
intended to limit the right of the County to enter into a separate agreement with the City or any other person to
provide source reduction, materials recovery, recycling, composting or other waste diversion services. Any such
program conducted by the County, whether in participation with the City, any other of the Participating Cities,
other Cities, Sanitary Districts, Transfer Stations, Independent Haulers, Unincorporated Area or non -County
entity, shall be operated, managed and accounted for as a program separate and distinct from the Disposal
Services program contemplated by the Disposal Agreements and shall not be funded through the general revenues
of the Disposal System.
Execution Copy 18
ARTICLE IV
CONTRACT RATE
SECTION 4.1. CHARGING AND SECURING PAYMENT OF CONTRACT RATE. The City
acknowledges that the County shall have the right to charge and collect a Contract Rate for the acccptanee and
disposal of Controllable Waste delivered to the System by any Franchise Hauler_ The Contract Rate shall be
calculated and established, and may be modified, as provided in Section 4.2 hereof. In addition, the City
acknowledges that the County shall have the right to establish as part of the operating rules and regulations
reasonable measures to secure the payment of all Contract Rates_
SECTION 4-2 Contract Rate_ (A) Initial Term. Effective July 1, 1997, the Contract Rate
payable by each Franchise Hauler shall be $22.00 per ton, contingent on the delivery to the Disposal System of
an amount of Acceptable Waste at least equal to the Cumulative Tonnage Targets identified in Appendix 2, and
subject to potential adjustment necessary to reflect the circumstances set forth below:
(i) increased costs incurred by the County (in excess of available insurance proceeds) due
to the occurrence of one or more Uncontrollable Circumstances, including Changes in Law;
00 average annual inflation at any point during the Term of this Agreement in excess of
four percent, compounded annually, calculated in accordance with Section 4.2 (F);
(iii) costs incurred by the County (in excess of available insurance proceeds and amounts
available in the Environmental Fund for such purposes) remcdiating environmental conditions at the
Disposal System or inactive or closed disposal sites in the County, which, if uncorrected, could give rise
to potential claims under CERCLA or related federal or state statutes, including costs incurred providing
indemnification to arty Participating City pursuant to subsection 7.3 (but not including costs of obtaining
insurance pursuant to Section 3.3(F)); or
(iv) tonnage shortfalls to the extent permitted by Sections 4.2(B) and 4.2(C).
Prior to adjusting the Contract Rate as a result of any of the circumstances described above, the County shall
utilize the following remedies in the following order of priority.
(i) reduce the costs of operating the Disposal System to the extent practicable,
(ii) utilize Excess Import Revenues to pay costs of the Disposal System; and
(Ili) utilize Unrestricted Reserves to pay costs of the Disposal System.
Any adjustments to the Contract Rate permitted by this Section shall be calculated by the County to reflect the
actual costs or expenses of addressing the circumstance or circumstances pursuant to which the adjustment is
authorized-
(B) County Acceptable Waste Shortfall. In the event that the actual amount of County
Acceptable Waste delivered to the Disposal System at the end of any Contract Year is less than the Cumulative
Tonnage Target for such Contract Year for County Acceptable Waste, as specified in Appendix 2, the County
shall utilize the following options, in the following order of priority, in order to remedy any adverse effects of
such tonnage shortfall:
(i) reduce the costs of operating the Disposal System to the extent practicable;
Execution Copy 19 (Revised Page)
(n) utilize Excess Import Revenues to pay costs of the Disposal System,
(I-ii) utilize Restricted Reserves described in clause (Ili) of Section 4 5 to pay costs of the
Disposal System;
(iv) utilize Unrestricted Reserves to pay costs of the Disposal System; and
(v) adjust the Contract Rate.
In the event that implementation of the steps described above do not result in sufficient revenues to satisfactorily
address the shortfall in tonnage, the County shall have the right to terminate the Agreement on 60 days written
notice to the City. In addition, in the event that actual deliveries to the Disposal System exceed the Cumulative
Tonnage Target as of the end of any Contract Year, the City acknowledges the County shall have the right to
establish reserves intended to reflect the potential for lower than expected annual waste deliveries in subsequent
years, and that any such reserves shall constitute "Restricted Reserves
(C) Imported Acceptable Waste Shortfall. In the event that the actual amount of Imported
Acceptable Waste delivered to the Disposal System at the end of any Contract Year is less than the Annual
Imported Tonnage Target for such Contract Year for Imported Acceptable Waste, as specified in Appendix 2,
the County shall utilize the following options, in the following order of priority, in order to (i) provide the net
annual payment to the County described in Section 3.6(E) of at least $15,000,000 and (ii) generate sufficient
revenues from the acceptance of Imported Acceptable Waste to continue to accept County Acceptable Waste for
the then applicable Contract Rate:
(1) reduce the costs of operating the Disposal System to the extent practicable;
(ii) utilize Excess Import Revenues to pay costs of the Disposal System; and
(iii) utilize Unrestricted Reserves to pay costs of the Disposal System.
in the event that, after implernen ation of the options described above, the sufficient revenues from the acceptance
of Imported Acceptable Waste are not available to both (i) provide the net annual payment to the County
described in Section 3.6(E) of at least $15,000,000 and (ii) generate sufficient revenues from the acceptance of
Imported Acceptable Waste to continue to accept County Acceptable Waste for the then applicable Contract Rate,
then the County may propose in writing to the Participating Cities an adjustment to the then applicable Contract
Rate intended to achieve both requirements described above. The Participating Cities shall then have the right
to either (i) accept the proposed adjustment to the Contract Rate or (ii) terminate the Agreement in writing. Any
Participating City which does not terminate the Agreement within 45 days after receipt of notice of the proposed
adjustment from the County shall be irrevocably deemed to have agreed to the proposed adjustment. In the event
that a sufficient number of Participating Cities (as reasonabh, determined by the County in light of then current
circumstances) do not agree in writing to the proposed adjustment to the Contract Rate within such 45 day period,
then the County may terminate the Disposal Agreements
(D) Interim Use of Remedies. In the event that, during any Contract Year, waste deliveries
to the Disposal System are 25% or more below delivery projections for such Contract Year with the result that
the County determines it is unlikely that the Cumulative Tonnage Target or Annual Imported Tonnage Target
will be achieved as of the end of such Contract Year, the County may utilize the remedies described in Section
4.2(B) or 4.2(C), as applicable prior to the end of such Contract Year; provided, however, that if at the end of
such Contract Year, the Cumulative Tonnage Target or Annual Imported Tonnage Target (as applicable) are
actually met, the County shall reimburse any adjustments to the Contract Rate made pursuant to this Section to
Participating Cities_ Such reimbursement may be given as a credit or adjustment to the Contract Rate for future
deliveries, rather than a lump sum payment
Execution Copy 20 (Revised Page)
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(F.) • Special Charges Notwithstanding Section 4 2(A), the County shall have the right to
impose special charges for the receipt of hard to handle materials, such as bulky materials, construction and
demolition debris, tires and sludge Such special charges shall be calculated to reflect the reasonable incremental
costs to the County of accepting such hard to handle materials
(F) Calculation of Average Annual Inflation For purposes of Section 4.2(A)(n), the
inflation shall be calculated as the change in the Producer Price Index, Finished Goods ("PPI"), reported by the
Bureau of labor Statistics of the United States Department of Labor between July of the year of calculation and
July 1,.1997_ Average annual inflation shall be deemed to exceed 4% if the ratio between the PPI Index for July
for the year of calculation (calculated in accordance with the formula below) and July 1997 exceeds the ratio
corresponding to such year of calculation on the table below. The ratio shall be calculated in accordance with the
following formula:
(July PPI Index of calculation year 1 PPI Index for July 1997)
Year of Calculation
Ratio
July 1, 1997
1.0000
July 1, 1998
1 0400
July 1, 1999
1.0816
July 1, 2000
1 1248
July 1, 2001
1.1699
July 1, 2002
12166
July 1, 2003
1.2653
July 1, 2004
1.3159
July 1, 2005
1-3685
July 1, 2006
14233
July 1, 2007
1.4802
In the event the PPI is no longer published during the term of this Agreement, such other index identified by the
Bureau of Labor Statistics or otherwise generally accepted as a replacement for PPI shall be used for purposes
of this Service Agreement-
(G) Procedure for Rate Adjustments. In the event the County determines that it is entitled
to an adjustment of the Contract Rate pursuant to Section 4.2, it shall utilize the procedures descnbed in this
Section 4.2(G)- The County shall be required to provide the City with at least 60 days prior written notice of the
adjust mend which notice shall identify the specific event(s) or circumstances which require the adjustment The
notice shall also specify the earliest date on which the County Board of Supervisors shall consider the proposed
adjustment. At least 45 days prior to such meeting of the Board of Supervisors, the County shall provide the City
with a report which shall contain the following information: a description of the specific cvent(s) or circumstances
which require the adjustment, a descnption (including cost estimates) of any activities (which may include, but
not be limited to capital improvements to the Disposal System) required in order to remedy such event or
circumstance, certification by the County that it has implemented the remedies described in Section 4 2 prior to
requiring the rate adjustment, and a description of the methodology used by the County to calculate the
adjustment to the Contract Rate (hereinafter the "County Report")_ In the event the City disputes the adjustment,
it shall provide the County with a written description of the reason for the dispute at least 10 days prior to the
meeting of the Board of Supervisors identified in the initial notice of the County (hereinafter the "City Report")
'Ihe City Report shall be provided to the Board of Supervisors for consideration at such meeting in connection
with the proposed rate adjustment. At any time from and after the date that the County provides the City with
EXecuiion Copy 21
0
the County Report, upon the request of either party, the City and County shall meet and confer in good faith to
resolve any dispute that may arise regarding the proposed adjustment to the Contract Rate In any such matting,
the County shall be represented by the Director of the Department or his or her designee In the event the Board
of Supervisors approves all or a portion of the proposed rate adjustment, such rate adjustment shall become
effective on the daft identified in the initial notice sent by the County regardless of whether or not the procedures
in Section 4 2(H) are utilised, but subject to potential reimbursement pursuant to clause (1 1) of Section 4-2(11)
(11) Procedure for expedited Judicial Review of Contested Rate Adjustment In the event
that, within 30 days after the effective date of any Contract Rate adjustment made pursuant to Section 4 2(G),
Participating Cities which, in the aggregate, accounted for more than 50% of the County Acceptable Waste
delivered to the County System in the twelve months preceding the Contract Rate adjustment, provide notice to
the County of their election to utilize the procedures described in this Section 4 2(H), then the provisions of this
Section 4-2(H) shall be utilized by such Participating Cities and the County to resolve the dispute over the
Contract Rate Adjustment- In the event that Partictpating Cities which have delivered the amount of waste
contemplated in the preceding sentence do not provide notice to the County of such election, the County shall
have no obligation to participate in or cooperate in the implementation of the procedures described below in this
Section 4.2(H). ,
I In order to pursue the expedited judicial determination described in this Section (the
"Expedited Rate Determination"), the Participating Cities which have made the election described in the
paragraph above (the "Challenging Cities") must commence a civil action for breach of contract (the
"Action") in the Orange County Superior Court within 45 days of the date on which the Board of
Supervisors approves the challenged adjustment to the Contract Rate.
2. Within two (2) days of filing the Action, the Challenging Cities shall personally serve
on the County Counsel both the summons and complaint, and a stipulation and request for the entering
of an order incorporating all of the procedural provisions relating to the Expedited Rate Determination
as set forth in this Section 42(H) (such stipulation and request for order is hereinafter referred to as the
"Expcdited Rate Determination Stipulation') The Expedited Raw Determination Stipulation shall be
signed by each of the Challenging Cities-
3. Within fifteen (15) days of the date of service upon the County of the summons and
complaint, and Expedited Rate Determination Stipulation, the County Counsel shall execute the
Expedited Rate Determination Stipulation and personally serve upon the Challenging Cities through their
counsel of record the Expedited Rate Determination Stipulation and its answer to the complaint in the
Action The Stipulation shall also include a waiver by each of the parties of their nght to a jury lira) of
the issues raised in the Action The City and the County mutually agree that the duty to execute the
Expedited Rate Determination Stipulation and comply with the procedures set forth for Expedited Rate
Determination in this Section 4.2(ff) shall be, and are hereby deemed to be, ministerial duties which the
law specifically enjoins upon each of them, and shall be subject to enforcement by the parties herein
pursuant to Code of Civil Procedure Section 1085, et sey , or by means of a complaint for specific
performance
4. Within three (3) days of the date of service by the County upon the Challenging Citics
of the fully signed Expedited Rate Determination Stipulation, the County and the Challenging Cities
shall Jointly make ex parse application to the Orange County Superior Court in the Action for the
issuance of the order contained in the Expedited Rate Determination Stipulation At such ex parse
application, the County and the Challenging Cities shall also seek to confirm with the Orange County
EACCUilon Copy 22
0
Superior Court the briefing schedule, and request a hearing date in accordance with the procedures set
forth in this Section 4 2(H)
5 Within ten (i 0) days of the date of service by the County upon the Challenging Cities
of the answer in the Expedited Rate Lk -termination, the Challenging Cities shall file with the court and
personally serve upon the County the Challenging Cities' openuig brief and the Record in the Expedited
Rate Determination The opening brief shall not exceed 15 pages in length The Record shall consist
of, and be limited to, the record of the proceedings before the Board of Supervisors with respect to the
adjustment of the Contract Rate, including but not limited to the County Report and the City Report
prepared by each or any of the Challenging Cities pursuant to Section 4.2(G), any matenals filed or
lodged with the Board of Supervisors and the Orange County Waste Management Commission, the
transcript of the proceedings of the Board of Supervisors meeting and the Orange County Waste
Management Commission, the minutes of the Board of Supervisors and the Orange County Waste
Management Commission meeting, and the resolution and/or other documentation evidencing action by
the Board of Supervisors and the Orange County Waste Management Commission to adjust the Contract
Rate pursuant to this Section 4 2 The record shall also include the most recent reports prepared
pursuant to Sections 4 G and 4.7_ The Expedited Rate Determination shall be decided solely on the
evidence in the Record, and no extrinsic evidence shall be submitted to or considered by the court_
5. Within ten (10) days of service by the Challenging Cities of their opening brief and the
Record, the County shall file and personally serve upon the Challenging Cities the County's opposition
brief The opposition brief shall not exceed 15 pages in length_
7. Within five (5) days of service by the County upon the Challenging Cities of the
opposition brief, the Challenging Cities may file and personally serve upon the County a rebuttal brief,
which shall not exceed 10 pages in length.
8. The trial of the Expedited Rate Determination shall be conducted as a hearing which
shall be conducted at the date set by the court in the ex parse hearing conducted pursuant to Section
4.2(H)(4), or such other date and time ordered by the court. No evidence other than the Record shall be
admitted into evidence or considered at the hearing of the Expedited Rate Determination, and no
testimorry shall be taken. The hearing sha!l:consist of oral argument and responses to inquines from the
court, as well as the evidence contained in the Record_ If the court requests the parties to prepare
supplemental briefs in response to any question or issue raised by the court, the parties may do so_
9. The standard of review for the Expedited Rate Determination shall be the
preponderance of the evidence based upon the Record. The burden of proof shall be borne by the
Challenging Cities, and the burden of proof shall be the same as with respect to a plaintiff in a damages
action for breach of contract. Both parties have participated in the drafting of this Agreement_
Accordingly, nothing set forth in this Agreement shall be interpreted or construed for or against either
of the parties as a consequence of their participation in the drafting of this Agreement.
10. The court shall issue its written statement of decision and enter judgment Within thirty
(30) days of the date of the hearing in the Expedited Rate Determination The City and the County
hereby waive any and all rights of reconsideration or new trial with respect to the court's determination
of any of the issues raised in the Expedited Rate Determination, and the City and the County waive any
and all rights to appeal the judgment or the determination of any issue raised in the Expedited Rate
Determination.
Iixccution Copy 23
0 •
l 1 if the court determines that any portion of the County's adjusted Contract hate which
is the subject of the Expedited Rate Determination was improperly imposed, the County shall, within 30
days of the date of the statement of decision, reimburse to the City the aniounl improperly imposed,
together with interest calculated at the highest percentage rate that does not constitute usury under
California laws Such reimbursement may be made in the form of a reduction in the Contract Rate for
a future period reasonably calculated to provide full reimbursement of the amounts described above.
12 If for any reason the court does not sign the order contained in the Expedited Rate
Detcrinination Stipulation, the City shall, iv:thin 30 days of the court's dental of such requested order,
file with the court and personally serve upon the County a motion for summary judgment and/or motion
for judgment on the pleadings, in accordance with Code of Civil Procedure Section 437 (c) and 439. By
executing this Agreement, the parties hereby stipulate that, in the event that the Challenging Cities file
such summary judgment motion and/or motion for judgment on the pleadings, the Record shall be
deemod to have been incorporated into the complaint -and answer filed by the Challenging Cities and the
County, and no evidence outside of the Record is relevant or material to the dispute raised in the
Expedited Rate Determination- The briefing schedule and hearing on such motion for summary
judgment and/or motion for judgment on the pleadings shall be in accordance with Code of Civil
Procedure Section 437(c) The Challenging Cities and the County shall be bound by all of the
requirements and restnetions set forth in Section 4.2(H) that are not in conflict with this paragraph (12)
13 In the event that the court both does not sign the order contained in the Expedited Rate
Detemtination Stipulation and either does not hear or does not issue a ruling on the merits on the motion
for summary judgment and/or judgment on the pleadings which is dispositive of the issues, claims and
causes of action in the complaint filed by the Challenging Cities, the County and the Challenging Cities
shall, within twenty days following the issuance of the Court's order or decision not to honor the parties'
stipulation or not to hear the parties' motion for summary judgement, make application to the Presiding
Judge of the Orange County Superior Court for an expedited hearing or trial date_ The Challenging
Cities and the County shall be bound by all of the requirements and restrictions set fortis in Section
4Hioi
.lct with this paragraph (13)_ in this regard, and without limiting the
foregoing, the only evidence to be presented at the hearing or trial shall be the Record, no testimony shall
be presented at the hearing or tnal; and both the County and the Challenging Cities waive all rights to
a jury trial, to any reconsideration of the -decision of the court, to a new trial after the court renders a
decision, and to any appeal or review of the decision of the court_
SECTION 4 3 RESPONSIBILITY FOR PAYMENT OF THE CONTRACT RATE_ (A)
Paym nt.by City_ In the event and to the extent (1) the City uses municipal collection forces directly for the
haulage of Controllable Waste to the Disposal System or (2) the City uses non -municipal Franchise Haulers for
collection but nonetheless elects to pay the Contract Rate from City revenues, the City, as its own Franchise
Hauler, shall have direct responsibility for payment of the Contract Rate, and shall take all such budgetary,
appropriation and other action as may be necessary to provide for the timely payment of the Contract Rate. Such
action may include, depending upon the means authorized by the City to provide for such payment, the levy and
collection of general or special taxes, the imposition of benefit assessments, or the collection of user fees,
generator charges or other similar impositions for municipal solid waste disposal. The City shall use best efforts
ui accordance with Applicable Law to levy and impose all such taxes, assessments, fees or charges, and will take
all steps, actions and proceedings for the enforcement, collection and payment of all such amounts which shall
become delinquent, to the full extent permitted by Applicable Law To the extent provided in Section 7 5 hereof,
Uie obligation of the City for such Contract Rates shall be limited to amounts in the City's Solid Waste Enterprise
Fund From the Commencement Date to the date of expiration or termination of this Agreement, the obligation
FACCUtIon Copy 24
of the City to pay the Contract Rate, to the extent the City rather than Franchise Haulers is responsible directly
for payment and provided that the Service Covenant has been complied with, shall be absolute. and unconditional
and shall not be subject to delay or diminution by reason of sct-off, abatement, counterclaim, existence of a
dispute or othcnvise
(B) Payment by Franchise haulers With respect to Controllable Waste delivered by
Franchise Haulers other than City municipal collection forces, the obligation to pay the Contract Rate shall rest
with such Franchise Haulers and not with the City and, unless the City has agreed with the County to be
responsible for -Franchise hauler payments, the City shall not be financially responsible for any dclay or failure
by such Franchise Hauler to pay the Contract Rate or any portion thereof when due_ In the event of any such
failure, the County and the City shall cooperate with each other and use their best efforts to obtain timely
payment. Such efforts by the County may include, as appropriate, requiring cash payments for disposal rights
from such Franchise Hauler and bringing a legal proceeding for payment and damages. Such efforts by the City
may include, as appropriate, legal proceedings to suspend, revoke or terminate the Franchise I iauler's franchise,
permit or license rights-
(C) Dos ales. If the City or the Franchise Hauler disputes any amount billed by the County
in any Billing Statement, the City or the Franchise Hauler shall nonetheless pay the billed amount and shall
provide the County with written objection within 30 days of the receipt of such Billing Statement indicating the
amount that is being disputed and providing all reasons then known to the City or the Franchise Hauler for any
objection to or disagreement with such amount_ If the City or the Franchise Hauler and the County are not able
to resolve such dispute within 30 days after the City's or the Franchise Hauler's objection, either party may pursue
appropriatc legal remedies.
SECTION 4.4. BILLING OF THE CONTRACT RATE. The County shall continue to bill
Contract Rates after July 1, 1997, in the same manner as it has customarily billed tipping fees- Subject to the
other provisions of this Agreement, the County shall have the right to modify or amend such manner of billing
on reasonable notice to affected parties.
SECTION 4.5_ RESTRICTED RESERVES. For purposes of this Agreement, "Restricted
Reserves" means cash and other reserves of the Disposal System which arc restricted to specific uses or arc
othenvlse being reserved -by the County to meet its obligations hereunder throughout the term of the Agreement
with respect to the Disposal System pursuant to any Applicable Law, contract, adopted budget, budgetary policy
of the County with respect to the Disposal System, or other arrangement_ Such cash and other rescrves are not
required to be deposited in separate accounts or funds in order to constitute "Restricted Reserves" hereunder, and
may be commingled with Unrestricted Reserves or other funds of the County attributable to the Disposal System
"Restricted Reserves" shall include, but not be limited to, the following=
(i) reserves for closure of components of the Disposal System to the extent required by
Applicable Law;
(ii) 75% of the amount reserved by the County for funding of post closure maintenance and
monitonng with respect to components of the Disposal System (provided, however, that if a Change in
I,aw occurs which requires the County to separately maintain post closure reserves at levels higher than
75% of the amount then currently maintained by the County, such higher amount shall constitute
"Restricted Reserves").
FACCu11011 Copy 25
(m) rusery s established to protect the Disposal System against the adverse financial impact of
potential decreases in waste deliveries pursuant to Section 4 2(B),
Ov) amounts reserved to pay the costs of capital improvements with respect to the Disposal
System,
(v) amounts funded from revenues dunng the early years of the term of the Agreement reserved
to enable the County to provide disposal scrviccs for the Contract Rate during the later years of the
Agreement.
(vi) amounts temporarily held by the County pnor to payment to the State or other
Governmental Bodies pursuant to Applicable Law (including any fees or charges payable to the State
Integrated Waste Management Board);
(vii) reserves required to meet bond covenants pursuant to financing agreements for Disposal
System assets to the extent such amounts must be legally separate and distinct from other reserves
identified in this Section;
(viii) security deposits from landfill deferred payment program users, and
(ix) amounts held by the County in the Environmental Fund ( provided, however, that such
amounts in the Environmental Fund will be made available and used by the County if required to pay
costs relating to environmental remediation or other related costs).
SECTION 4.6_ AUDITED FINANCIAL STATEMENTS_ The County shall annually, on or
before January 1 each year commencing on January 1, 1998, prepare or cause to be prepared and have on file for
inspection an annual report for the preceding Contract Year, accompanied by a certificate of an independent
public accountant or of the County Auditor and Controller as to the examination of the financial statements
therein (describing such statements as fairly presenting the information therein in conformity with generally
accepted accounting principles) relating to the Disposal System, the Disposal Services, and the fiscal activities
of the County Waste Disposal Enterprise Fund, and including statements in reasonable detail of the financial
condition of the County Waste Disposal -Enterprise Fund as of the end of the Contract Year and revenue and
expenses for the Contract Year
SECTION 4 7_ _ANNUAL UPDATE OF TEN-YEAR FINANCIAL PROJECTION. The
County shall annually, on or before May I of each year, commencing May 1, 1998, prepare or cause to be
prepared, an updated Ten -Year Financial Projection for the Disposal System. Said Financial Projection shall
include at least two full years of prior actual data and ten years of future projections including the following
elements:
County Acceptable Waste, in tons,
Imported Acceptable Waste, in tons;
Revenues and expenditures,
Cash fund balances, including all monies in the County Solid Waste Enterprise Fund,
with specific delineation of monies in the Environmental fund, Restricted Reserves,
Unrestricted Reserves, and all other funds of the System
Execurton Copy 26
Projected liabilities for closure and post closure as -well as reasonable resmes for other
environmental costs
The purpose of the Ten -Year Financial Projection is to keep the City fully informed about the future financial
condition of the Disposal System The County shall cause a copy of the Ten -Year Financial Proicction to he
delivered to the City Manager of the City no later than May 1 of each year, commencing May 1, 1999
f:xccutcon Copy 27
ARTICLE V
BREACH, ENFORCEMENT AND TERMINATION
SI:CTION 5 1 BREACH. The parties agree that in the event either party breaches any
obligation under this Agreement or any representation made by either party hereunder is untrue in any material
respect, the other party shall have the right to take any action at law or in equity (including actions for injunctive
relief, mandamus and specific performance) it may have to enforce the payment of any amounts due or the
performance of any obligations to be performed hereunder. Neither party shall have the right to terminate this
Agreement except as provided in Section 5.2 and Section 5 3 hereof or as otherwise provided in this Agreement
SECTION 5 2 ary CONVENIENCE TERMINATION The City shall have the right to
terminate this Agreement in its sole discretion, for its convenience and without cause at any time during the Term
hereof upon 90 days' written notice to the County- If the City exercises its rights to terminate the Agreement
pursuant to this Section, the City shall pay the County a termination fee equal to the Contract Rate in effect at
the time of such termination (or any higher rate with respect to which the County has provided notice pursuant
to Section 4 2(G)) multiplied by the number of tons of City Acceptable Waste delivered to the Disposal System
during the preceding twelve months (or, if the City had been in breach of the Waste Disposal Covenant during
such prior months, such amount as would have been delivered if the City had complied with the Waste Disposal
Covenant), multiplied by the number of years remaining in the 'fcrm of the Agreement.
SECTION 5.3. TERMINATION (A) By City_ Except as expressly provided herein, the City
shall have no right to terminate this Agreement for cause except in the event of the repeated failure or refusal by
the County substantially to perform any material obligation tinder this Agreement unless such failure or refusal
is excused by an Uncontrollable Circumstance; except that no such failure or refusal shall give the City the right
to terminate this Agreement for cause under this subsection unless:
(1) The City has given prior written notice to the County stating that a specified failure or
refusal to perform exists which will, unless corrected, constitute a material breach of this Agreement on
the part of the County and which will, in its opinion, give the City the right to terminate this Agreement
for cause under this subsection unless such breach is corrected within a reasonable period of time, and
(2) The County has neither challenged in an appropriate forum (in accordance with Section
5 5) the City's conclusion that such failure or refusal to perform has occurred or constitutes a material
breach of this Agreement nor corrected or diligently taken steps to correct such breach within a
reasonable period of time not more than 90 days fxom the date of the notice given pursuant to clause (1)
of this subsection (but if the County shall have diligently taken steps to correct such breach within such
reasonable period of time, the same shall not constitute a breach giving nse to the nght of termination
for as long as the County is continuing to take such steps to correct such breach)
(B) By County. Except as expressly provided herein, the County shall have no right to
terminate this Agrecment for cause except in the event of the repeated failure or refusal by the City substantially
to perform any material obligation under this Agreement unless such failure or refusal is excused by an
Uncontrollable Circumstance, except that no such failure or refusal shall give the County the nght to terminate
this Agreement for cause under this subsection unless
(1) Pic County has given pnor IMucn notice to the City stating that a specified failure or
refusal to perform exists which will, unless corrected, constitute a material breach of this Agreement on
Fxccu4on Copy 28 (Revised Pagc)
the part of the City and which will, in its opinion, give the County right to terminate this Agreement for
cause under this subsection unless such breach is corrected within a reasonable period of time, and
(2) The City has neither challenged in an appropriate forum (in accordance with Section
5 5) the Countv's conclusion that such failure or refusal to perform has occurred or constitutes a material
breach of this Agreement nor corrected or diligently taken steps to correct such breach within a
reasonable period of time not more than 90 days from the date of the notice given pursuant to clause (1)
of this subsection (but if the City shall have diligently taken steps to correct such breach within such
reasonable period of time, the same shall not constitute a breach giving rise to the right of termination
for as long as the City is continuing to take such steps to correct such breach)
SECTION 5 4 _NO WAIVERS No action of the County or the City pursuant to this
Agreement (including, but not limited to, any investigation or payment), and no failure to act, shall constitute a
waiver by either party of the other party's compliance with any term or provision of this Agreement. No course
of dealing or delay by the County or the City in exercising any right, power or remedy under this Agreement shall
operate as a waiver thereof or otherwise prejudice such party's rights, powers and remedies No single or partial
exercise of (or failure to exercise) any right, power or remedy of the County or the City under this Agreement
shall preclude any other or further exercise thereof of the exercise of any other right, power or remedy_
SECTION 5 5- FORUM FOR DISPUTE RESOLUTION_ It is the express intention of the
parties that all legal actions and proceedings related to this Agreement or to the Disposal System or to any rights
or any relationship between the parties arising therefrom shall be solely and exclusively initiated and maintained
in courts of the State of California having appropriate jurisdiction
Execution Copy 29
ARTICLE. VI
TERM
SECTION 6.1. EFFECTIVE DATE AND TERM (A) Initial Term_ This Agreement shall
become effective, shall be in fWI force and effect and shall be legally binding upon the City and the County from
the Contract Date and shall continue in full force and effect until the tenth anniversary of the first day of the
Contract Year following the Contract Year in which the Commencement Date occurs, unless earlier terminated
in accordance with its terms, in which event the Term shall be deemed to have expired as of the date of such
termination.
(B) Option to Renew_ This Agreement shall be subject to renewal by mutual agreement of
the parties, on or before June 30, 2004, for an additional tern of ten years (the "Renewal Term") on the same
terms and conditions as are applicable during the Initial Term hereof. The City shall give the County written
notice of its irrevocable election to renew this Agreement on or before June 30, 2004_ If the parties do not renew
this Agreement by June 30, 2004, the Agreement shall expire on June 30, 2007_
(C) Contract Rate During Renewal Term. In connection with the parties right to renew this
Agreement for an additional ten-year term pursuant to Section 6.1(B), the parties shall, on or before June 30,
2004, negotiate an applicable change in the Contract Rate for such renewal term. In determining any revisions
to the Contract Rate to be applicable during any renewal period, in addition to the circumstances described in
Section 4.2(A), the parties may take into consideration the following parameters, including but not limited to:
(i) actual cost of operations;
(ii) population growth;
(iii) increase or decrease in available tonnage;
(iv) economic and disposal market conditions in the Southern California region;
(v) changes in transportation and technology;
(vi) closure and expansion of nearby landfills;
(vii) capacity of the Disposal System; and
(viri) available reserves_
(D) Survival, Accrued Rights_ The rights and obligations of the parties hereto pursuant to Sections
3. I(E)(2), 5.1, 5.3, 5-5, 72, 73, 7.5, 7.7, 7.8, 7.9, and 7.10 hereof shall survive the termination or expiration of
this Agreement, and no such termination or expiration shall limit or otherwise affect the respective rights and
obligations of the parties hereto accrued prior to the date of such termination or expiration. At the end of the
Term of this Agreement, all other obligations of the parties shall terminate.
SECTION 6.2_ COMMENCEMENT DATE. (A) Obligations of the Parties Prior to the
Commencement Date. The parties acknowledge that the Disposal Agreements may be executed and delivered
on different dates and that, except as provided in this subsection, neither the County nor the City shall be
obligated to perform its obligations hereunder until the participation threshold provided herein has been met and
the other conditions to the occurrence of the Commencement Date have occurred. Pnor to the Commencement
Date, each party hereto shall at its own expense exercise good faith and due diligence and take all steps within
its reasonable control in seeking to satisfy the conditions to the Commencement Date set forth herein as soon as
reasonably practicable_ The County and the City, each at its own expense, shall cooperate fullywith each other
and the other Participating Cities in connection with the foregoing undertaking-
Fxceution Copy 30 (Revised Page)
• 0
(B) Condition to the Commencement Date The Commencement Datc for the Agreement
shall be the date on which the Aggregate Estimated Annual Tonnage attributable to Participating Cities, Transfer
Stations and Independent Haulers which have executed and delivered Disposal Agreements shall be 1,842,000
tons per year (using the amounts attributed to such Cities, Independent Haulers or Transfer Stations in Appendix
1)
(C) Satisfaction of Condition and Commencement Date. Each party shall give the other
prompt notice «ficn the condition to the Commencanernt Date has been satisfied Upon the satisfaction or waiver
of such Commencement Date condition, the County shall give written notice thereof to the cities which have
theretofore executed Disposal Agreements The parties shall thereupon hold a formal closing acknowledging the
satisfaction or waiver of the condition to the Commencement Date, certifying that the Commencement Date has
occurred and designating the Participating Cities Original or certified copies of all of the documents or
instruments constituting or evidencing satisfaction of the Commencement Date conditions shall be fumished to
each party prior to or on the Commencement Date
(U) Newt Incomorated Cities. Any city within Orange County which becomes incorporated
after the Commencement Date shall upon request be offered the opportunity by the County to become a
Participating City. If any such City executes a Disposal Agreement and meets the applicable condition provided
in subsection 6 2(B) hereof within 180 days following the date of its municipal incorporation, then such City shall
be entitled to execute a Waste Disposal Agreement on substantially the same terms and conditions as this
Agreement (including the Contract Rate), notwithstanding the limitations contained in Section 3.6(B).
(E) failure of Condition. If by March 30, 1997, or such later date as the County may agree,
the condition to the Commencement Date specified in this Section is not satisfied, either party hereto may, by
notice in writing to the other party, terminate this Agreement- Neither party shall be liable to the other for the
termination of this Agreement pursuant to this subsection, and each of the parties shall bear its respective costs
and expenses incurred in socking to satisfy the condition to the Commencement Date.
Exccution Copy' 31 (Revised Page)
• 0
ARTICLE VII
GENERAL PROVISIONS
SECTION 7 1. OPERATION AND MAINTENANCE OF THE DISPOSAL SYSTEM The
County, at its cost and expense through the County Solid Waste Enterprise Fund, shall at all times operate, or
caused to be operated, the Disposal System in accordance with Applicable Law and the operating rules and
regulations of the Department
SECTION 7.2 UNCONTROLLABLE CIRCUMSTANCES GENI:RAI,LY.
(A) Performance Excused. Except as otherwise specifically provided in this Agreement, neither the County nor
the City shall be liable to the other for any failure or delay in the performance of any obligation under this
Agreement (other than any payment at the time due and owing) to the extent such failure or delay is due to the
occurrence of an incontrollable Circumstance-
(B) Notice, Mitigation. The party experiencing an Uncontrollable Circumstance shall notify
the other party by telecommunication or telephone and in writing, on or promptly after the date the party
experiencing such Uncontrollable Circumstance first knew of the commencement thereof, followed within 15 days
by a written description of (1) the Uncontrollable Circumstance and the cause thereof (to the extent known), (2)
the date the Uncontrollable Circumstance began and the cause thereof, its estimated duration, the estimated time
during which the performance of such party's obligations hereunder will be delayed, (3) the estimated amount,
if any, by which the Contract Rate may need to be adjusted as a result of such Uncontrollable Circumstance, (4)
its estimated impact on the other obligations of such party under this Agreement and (5) potential mitigating
actions which might be taken by the County or City and any areas where costs might be reduced and the
approximate mnotmt of such cost reductions_ Each party shall provide prompt written notice of the cessation of
such Uncontrollable Circumstance. Whenever such act, event or condition shall occur, the party claiming to be
adversely affected thereby shall, as promptly as reasonably possible, use its best efforts to eliminate the cause
therefor, reduce costs and resume performance under this Agreement. In addition, with respect to Changes in
Law, the County shall diligently contest any such changes the imposition of which would have a material adverse
impact on the Disposal System_ While the delay continues, the County or City shall give notice to the other party,
before the first day of each succeeding month, updating the information previously submitted.
(C) . Impact on Contract Rate-. Lf.and to the extent that Uncontrollable Circumstances
interfere with, delay or increase the cost to the County of meeting its obligations hereunder and providing
Disposal Services to the Participating Cities in accordance herewith, the County shall be entitled to an increase
in the Contract Rate as provided in Section 4.2 herein or an extension in the schedule for performance equal to
the amount of the increased cost or the time lost as a result thereof, The proceeds of any insurance available to
meet any such increased cost shall be applied to such purpose prior to any determination of cost increases payable
under this subsection. Any cost reductions achieved through the mitigating measures undertaken by the County
pursuant to subsection 7.2(B) hereof upon the occurrence of an Uncontrollable Circumstance shall be reflected
in a reduction of the amount by which the Contract Rate would have otherwise been increased or shall serve to
reduce the Contract Rate to reflect such mitigation measures, as applicable.
SECTION 7.3. INDEMNIFICATION TO the extent permitted by la%ti the County agrees that,
it will protect, indemnify, defend and hold harmless the City from and against all Loss-and-Expcnsc arising from
the Cityfs activity as an "arranger" (for purposes of and as such term is defined under CERCLA or comparable
state statutes) of municipal solid waste disposal pursuant to this Agreement. In the event the City shall determine
that because of conflict or any other reason that it wishes to be defended by legal counsel other than the legal
counsel provided by the County, the cost of providing such legal counsel shall be the City's sole responsibtlity
The City acknowledges the Count_y's legitimate interest in actively participating to any
F\cculion Copy 52 (Rcvrscd 1'agc)
defense, litigation or settlement whether the County or the City provides legal counsel Any casts incurred by the
County pursuant to this Section shall be considered an Uncontrollable Circumstance cost and the County shall
be entitled to adjust the Contract Rate as provided in subsection 4 2(A) herein The County shall not, however,
be required to indemnify or defend the City from and against all Loss -and -Expense arising from any willful,
knowing, illegal or negligent disposal of hazardous waste (other than incidental amounts of I iouschold Hazardous
Waste commonly found in municipal solid waste and permitted to Le; disposed in Class III landfills under RCRA)
which violates the County's landfill permits or Applicable Law The parties agree that this provision constitutes
an indemnity under CERCLA (to the extent of the specific.provistons of this Section). The parties acknowledge
that this subsection is not intended to and does not create any obligation on the part of the County to provide any
indemnification or defense to any Franchise Hauler, whether franchised or not, or any Independent Hauler or
Transfer Station, under any circumstances_ The City acknowledges the County's legitimate interest in actively
participating in any defense, litigation or settlement, and shall, as a condition to this indemnity, coordinate fully_
with the County in the defense.
SECTION 7 4. RELATIONSHIP OF THE PARTIES. Neither party to this Agreement shall
have any responsibility whatsoever with respect to services provided or contractual obligations or liabilities
assumed by the other party hereto, whether accrued, absolute, contingent or otherwise, or whether due or to
become due. The County is an independent contractor of the City and nothing in this Agreement shall be deemed
to constitute either party a partner, agent or legal representative of the other party or to create any fiduciary
relationship between the parties.
SECTION 7.5 LIMITED RECOURSE. (A) To the City- Except in the event the City has
not established or maintained a City Solid Waste Enterprise Fund, no recourse shall be had to the general funds
or general credit of the City for the payment of any amount due the County hereunder, or the performance of any
obligation incurred hereunder, including any Loss-and-Expensc of any nature arising from the performance or
non-performance of the City's obhgations hereunder. -fhe sole recourse of the County for all such amounts shall
be to the funds held in any such Solid Waste Enterprise Fund_ All amounts held in any City Solid Waste
Enterprise Fund shall be held for the uses permitted and required thereby, and no such amounts shall constitute
property of the County. The City shall make adequate provision in the administration of any City Solid Waste
Enterprise Fund for the payment of any amount or the performance of any obligation which may be due
hereunder.
(B) To the County. No recourse shall be had to the general funds or general credit of the
County for the payment of any amount due the City hereunder, or the performance of any obligation incurred
hereunder, including any Loss -and -Expense of any nature arising from the performance or non-performance of
die Count 's obhgations hereunder_ The sole recourse of the City for all such amounts shall be to the funds held
in the County Solid Waste Enterprise Fund in accordance with the terms of this Agreement_ All amounts held
in the County Solid Waste Enterprise Fund shall be held for the uses permitted and required thereby, and no such
amounts shall constitute property of the City- The County shall make adequate provision in the administration
of the County Solid Waste Enterprise Fund for the payment of any amount or the performance of any obligation
which may be due hereunder_
SECTION 7 6 PRI:-EXISTING RIGHTS AND -LIABILITIES Nothing in this Agreement
is intended to affect, release, waive or modify any rights, obligations or liabilities which any party hereto may
have to or against die other party as of the Contract Date relating to the disposal of waste in the Disposal System
or any other related matter
SEC I'ION 7 7 NO VESTED RIGHTS The City shall not acquire any vested property, license
or other rights in the Disposal System by reason of this Agreement
tixciution Copy 33 (Reviscd Page)
0
SECTION 7 R LIABILITY FOR COLLECTION, I'RANSPOR"fAT10N AND
PROCPSSINC; Any liability incurred by the City as a result of collecting Acceptable Waste or processing it for
diversion from landfill, or as a result of causing, franclus►ng, permitting, licensing, authorizing or arranging any
of the foregoing, shall be its sole liability, except as expressly otherwise provided herein
SF'CTION 7 9 NO CONSE UFNTIAI. OR PUNI'ITVE DAMAGES In no event shall either
party hereto be liable to the other or obligated in any manner to pay to the other any special, incidental,
consequential, punitive or similar damages based upon claims arising out of or in connection with the
performance or non-performance of its obligations or otherwise under this Agreement, or the material inaccuracy
of any. representation made in this Agreement, whether such claims are based upon contract, tort, negligence,
warranty or other legal theory
SECTION 7 10. AMENDMENTS_ Neither this Agreement nor any provision hereof may be
change modified, amended or waived except by written agreement duly authorized and executed by both parties_
SECTION 7.11. NOTICE OF LITIGATION. Each party shall deliver written notice to the other
of any Legal Proceeding to which it is a party and which questions the validity or enforceability of this Agreement
executed by the City or the County or any Legal Entitlement issued in connection hercwnth_
SECTION 7.I2. FURTHER ASSURANCES At any and A times the City and the County so
far as may be authori7ed by law shall pass, make, do, execute, acknowledge and deliver any and every such
further resolutions, acts, deeds, conveyances, instruments, assignments, transfers and assurances as may be
necessary or reasonably requested by the other in order to give full effect to this Agreement_
SECTION 7 13. ASSIGNMENT OF AGREEMENT. (A) Assignmcni Neither this Agreement
nor any of the rights or obligations hereunder may be assigned by either party hereto without the prior written
consent of the other party, which may be withheld in the other parry's sole discretion. Notwithstanding the
foregoing, that either party may assign this Agreement to another public entity, subject to the reasonable consent
of the other party. In such circumstances the party not requesting the assignment shall have the right to demand
assurances of the financial, technical and legal ability of the proposed assignee to undertake the responsibilities
and obligations of the assigning party
(13) Sale_ The County shall not enter into negotiations with respect to the sale of the
Disposal System prior to June 30, 2004. In addition, the County shall not enter into any agreement for the sale
of the Disposal System wluch provides for an effective date for such sale prior to the expiration or termination
of this Agreement.
SECTION 7.14_ INTEREST ON OVERDUE OBLIGATIONS_ Except as otherwise provided
herein, all amounts due hereunder, whether as damages, credits, revenue or reimbursements, that are not paid
when due shall bear interest at the Overdue Rate on the amount outstanding from time to time, on the basis of
a 365-day year, counting the actual number of days elapsed, and all such interest accrued at any time shall, to the
extent permitted by Applicable Law, be deemed added to the amount due, as accrued.
SECTION 7.15 BINDING EFFECT This Agi-cxnent shall bind and inure to the benefit of the
parties hereto and any successor or assignee acquiring; an interest hereunder consistent %vith the provisions of
Section 7 13 hereof
Execution Copy 34
0
SFCTION 7 IG NOTICES Any notice or communication required or permitted hereunder shall
be in wasting and sufficiently given if delivered in person or sent by certified or registered mail, postage prepaid,
to the notice address of the respective parties set forth on the cover page of this Agreement Changes in the
respective addresses to %%filch such notices may be directed may be made from time to time by any party by notice
to the other party
F'Xccut;on Copy 35
/ -•
IN WITNESS WHEREOF, COUNTY and CITIES have caused this Agreement to be
executed by their duly authorized officers or representatives as of the day and year first above written.
COUNTY OF ORANGE
Date 1-. 7—f 7 By
Director, Integrated Waste Management Department
Date
By
City of Huntington Beach
Ralph Bauer, Mayor
APPROVED AS TO FORM:
COUNTY COUNSEL ATTEST:
ORANGE COUNTY./CALIFORNIA
By
Date
City Clerk, Connie grockway
City of Huntington Beach
Execution Copy 36
0 0
APPENDIX 1
ESTIMATFD ANNUAL TONNAGE
CAIGQIRY 1
Anaheim
Santa Ana
Orange, City
Fullerton
Unincorp County
Garden Grove San Dist
Tustin
Buena Paris
Midway City San Dist
Newport Bch-CR&R+City
La Habra
Lake Forest
Laguna Niguel
Irvine - residential
San Clemente
San Juan Capistrano
Laguna Beach
Cypress
Yorba Linda
Brea
Placentia
Costa Mesa San Dist
Laguna Hills
Villa Park
�PENDtkl
IESTIMAQ-AIyNYAL TONNAG- FOR PtJ�2POSE QF SECTJO.N
C,AlQLOTPY 2
9-8TEGORY 3
Huntington Beach
Rainbow
155,610
�;45,732
Sunset Environmental
I 91,014
Fountain Valley
Rainbow
Western Waste
44,0401
Dana Point
Solag
29 673'
South Coast Refuse
=:32 23
Mission Viejo
BFI-Residential
_ _ 26.488
Great Western
L J _:_.27 572
Mission Viejo
West Waste-Comml
26436
CR&R-Costa Mesa
I� --_
26039Stanton
CR&R
�i721 723
Rainbow
15 601
,—
4�_
Seal Beach
Briggeman
_
_ 183891
Fivestar Rubbish
•
14,002
�_
Los Alamitos
Briggeman
15,952 ,'
Waste Mgmt of OC
! 11,197
Los Alamitos
CV r
5}
National Refuse
fin_ 3,6
La Palma
CR Transfer
_
r 8.720
C R&R-Irvine
3�32
La Palma
Park
isFederal
Disposal
1219:.
Ware Disposal
,...: • - 2,868
Orange Res/Recov
_ 344.
A Trojan Disposal
224 .
SOLAG Disposal
214.
Taormina
;. 1.33
Orange Disposal
100,1
BFIfOrganics
_ 85
Briggeman
12
MG Disposal
i� 9
Tnis Appendix 1 shall be used to determine if the Aggregate Estimate Annual Tonnage threshold of 1,842,000 Ions has bee mel
for purposes of Section 6 2(B) The amount attributable to any City in Category 1 above shalt be included for purposes of such
aetermination upon execution of a Waste Disposal Agreemert by that City The amount allnbutable to any Ci!y in Category 2 aocve
shall on:y be included for purposes of such determination upon
(1) execution of a Waste Disposal Agreement by such City and
(2) execution of a Hauler Acknowledgment (in substanlial:y the form set forth in APoen6x 3) or Hauler Waste D soosal Ag•eerne-t
by the Franchise Hauler corresponding to such Category 2 City :n the table above
The amour.t attributable to any hauler in Category 3 above sha;l be ircluded for purposes of such de'erminaticn upon execu: on
by such hauler of a Waste Disposa! Agreement
0
:217 C,C.'
APPENDIX 2
CUMULATIVE TONNAGE TARGETS
0 APPENDIX 2 0
Cumulative Tonnage Target to be Used
for Purposes of Section 4.2 (B)
FY 1997-98.. �—
2,2771
FY 1998-99 `.
2,134
�2,277
FY 1999-2000,
2,007�
_4,411
_ 6,418_
FY 2000-01
2,025 1
FY 2001-02
2,042
_8,443
10,485
FY 2002-03 _
2,060 --
12,545
FY 2003-04
2,079
14,624
_
FY 2004-05
2,09�
16,720
FY 2005-06
21111 i
18,831
FY 2006-07
2,1281
20,959
Note: Tons are expressed in thousands.
Annual Importation Tonnage Target
to be Used for Purposes
of Sections 4.2 (C)
_ 1
2
—
11997-98
1998-99 L
1
_
1,428
1,428
3
1999-2000
1,428
_
4
2000-01
_ 5 ..—
. - 2001-02 -..— --
_1,428
1,42$
6
2002-03
1,428
7
;2 00 3 04 i 4
— 1,428
8 ..—_
2004-05 T
— 1,428
9
�2005-06 t
1,428
10
_
1,2006-07
--
1,428
Note: Tons are expressed in thousands_
0
APPENDIX 3
FORM OF HAULER ACKNOWLEDGMENT'
FRANCHISE HAULER ACKNOWLEDGMENT
THIS FRANCHISE HAULF;R ACKNOWLEDGMF,NI', dated as of _ _ 1997
(the "Acknowledgment"), by and between the City of _ (the "City") and
(the "Franchise Hauler")
WITNESSCTH
WHEREAS, the City and the Hauler have heretofore entered into an agreement entitled _
4, dated as of _ .__ (the "Franchise"), and
WHEREAS, the Franchise; provides for the collection and disposal of certain municipal solid
waste as described therein ("Franchise Waste") generated within the City; and
WHEREAS, Orange County (the "County") owns, manages and operates a sanitary landfill
disposal system for municipal solid waste generated within the County; and
WHEREAS, the City and the County have heretofore entered into a Waste Disposal
Agreement, dated as of , 1997 (the "Disposal Agreement") determining that the execution of
such Disposal Agreement will serve the public health, safety and welfare of the residents of the City and
County, by maintaining public ownership and stewardship over the Orange County Landfill Disposal System
(the "Disposal System"); and
WHEREAS, tinder the Disposal Agreement, the County has agreed to provide long-term
disposal of all municipal solid waste generated within the City and the City has agreed to exercise all legal,
and contractual power which it possesses from time to time to deliver or cause the delivery of such waste to
the Disposal System, and
WHEREAS, the provisions of the Waste Disposal Agreement which guarantee capacity for
the long term disposal of waste at specified rates generated in the City provide significant benefits to the
Hauler;
WHEREAS, notwithstanding any Franchise provisions to the contrary, the Franchise Hauler
explicitly acknowledges the aforementioned benefits to the City, the County and the Hauler in providing for
the disposal of all Franchise Waste to the Disposal System; and
WIiER.EAS, the City and the Franchise Ilauler desire to enter into this Acknowledgment to
assure that the City and the hauler will be entitled to the heneFts of the Waste Disposal Agreement and to
assure conformity with the waste delivery obligations which have been agreed to by the City under die Disposal
Agreement through the delivery of waste by the Franchise Ilauler to the Disposal System; and
0
WHEREAS, the Franchise Hauler's agreement to deliver Franchise Waste to the Disposal
.System under this Acknowledgment is given in consideration of the Franchise I lauler's right to receive the
Contract Rate for such disposal as provided in the Disposal Agreement.
NOW, TIIEREFORE'-, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending (0
be legally bound hereby, agree as follows= .
Capitalized terms used and not otherwise defined herein are used as defined in the
Disposal Agreement.
2. 1lie Franchise Hauler hereby waives any right which it may possess under applicable
law to contest on any ground, constitutional, statutory, case law, administrative or otherwise, (a) the right,
power or authority of the County or the City to enter into or perform their respective obligations under the
Disposal Agreement, (b) the enforceability against the County or the City of the Disposal Agreement, or (c)
the right, power or authority of the City to deliver or cause the delivery of all Controllable Waste to the
Designated Disposal Facility in accordance with this Acknowledgment.
3. The City and the Franchise Hauler each hereby represent that this Acknowledgment
has been duly authorized by all necessary action of their respective governing bodies.
4. The Franchise Hauler shall deliver or cause to be delivered all Controllable Waste
(including all residue from the processing by any means, wherever conducted, of Controllable Waste), to the
Disposal System, and shall otherwise assist the City in complying with its obligations under the Waste Disposal
Covenant in Section 3.1 of the Disposal Agreement.
5. The Franchise Hauler shall not haul Controllable Waste to any materials recovery
facility, composting facility, intermediate processing facility, recycling center, transfer station or other waste
handling or management facility unless the contract or other agreement or arrangement between the Franchise
Hauler and the operator of such facility is sufficient in the opinion of the County to assure that the Residue
from such facility constituting City Acceptable Waste (or Tonnage equivalencies) and the City Acceptable
Waste transferred by such facility shall be delivered to the Designated Disposal Facility in compliance with
the Waste Disposal Covenant.
6. The Franchise Hauler shall pay the Contract Rate imposed by the County at the
Designated Disposal Facility for the disposal of all Controllable Waste, which rate shall be subject to potential
adjustment necessary to reflect the circumstances set forth in the Disposal Agreement_
7. Nothing in this Acknowledgment is intended to restrict any right or responsibility
explicitly given the Franchise Hauler in the Franchise to recycle City Acceptable Waste, except as provided
in paragraph 5 above widt respect to Residue from any such recycling operations-
8- The obligations of the Franchise Hauler under this Acknowledgment shall apply
notwithstanding any provision of the Franchise which may conflict herewith.
9. This Acknowledgment may be enforced by the City by any available legal means.
In any enforcement action by the City, the burden of proof shall be on the Franchise Hauler to demonstrate
compliance herewidl_
2
10 This Acknowledgment shall be in frill force acid effect and shall be legally binding
upon the City and Franchise I lauler from the dated hereof and shall continue in full force and effect until the
earlier of (i) the end of the terra of the Franchise or (it) the end of the term of the Disposal Agreement_
1- The City and Hauler agree that the County shall be an express third party beneficiary
of this Acknowledgment, and shall tic entitled to independently enforce the obligations of the I-lauler
hereunder_
IN WITNESS WHF:REO , the parties have caused this Acknowledgment to he executed by
!heir duly authorized officers or representatives as of day of _ 1997
CITY Of
Signature _..
I't toted Name -
Title:
(franchise Hauler)
Signature:
Printed Name- _
Title_ _ ..
AA
CITY OF HUNTINGTON BEACH
t�
• Y
`MEETING DATE: March 17, 1997 DEPARTMENT ID NUMBER:
Mill
C" 4
Council/Agency Meeting Held: -3Ii-7L97
Deferred/Continued to:
U'Approved ❑ Conditionally Approved El Denied City Clerk's Si ature
Council Meeting Date- March 17, 1997 Department ID Number -
CITY OF HUNTINGTON BEACH
-- REQUEST FOR COUNCIL ACTION
.I
,M
SUBMITTED TO:
HONORABLE MAYOR AND CITY COUNCIL MEMBERS
=
s
SUBMITTED BY:
MiCHAEL T. UBERUAGA, City Administrator_
i
PREPARED BY:
Ray Silver, Assistant City Administrator&PA P
4J
^ rn
i- C,CD
SUBJECT:
Approval of Agreement between the County of Orange and
th —
it4
for Waste Flow Control 3 3 9
Statement of Issue, Funding Source, Recommended Action, Alternative Actions),
Analysis, Environmental Status, Attachment(s)
The cities in Orange County and the county itself are interested in maintaining public
ownership of the landfill disposal system. In order to assure this, the county is working to
contain their costs and establish adequate and predictable revenues to pay their bills. 'The
cities in the county are working to establish predictable gate fees at the lowest possible cost
for disposing of solid waste coming from their respective city. The purpose of this agreement
is to attain these objectives. Otherwise the county will pursue consideration of sale of the
landfill system.
1. Approve the Waste Disposal Agreement between the County of Orange and the City
of Huntington Beach and authorize the Mayor and City Clerk to execute the
agreement.
2. Approve the Franchise Hauler Acknowledgment between the City of Huntington
Beach and Rainbow Disposal and Rainbow Transfer and Recycling Companies and
authorize the Mayor and City Clerk to execute.the acknowledgment..
0023394.01 -2- 03106/97 10-15 AM
9
s 0
REQUEST FOR COUNCIL ACTION
MEETING DATE: March 17, 1997
DEPARTMENT ID NUMBER:
3. Introduce and adopt Ordinance No 333qq approving Supplement No. 2 to Refuse
Collection and Disposal Services Franchise Agreement by and between the City of
Huntington Beach and Rainbow Disposal and Rainbow Transfer and Recycling
Companies and authorize the Mayor and City Clerk to execute same.
Since the late 1980's, the County's Integrated Waste Management Department and the
cities in' the county have been exploring an agreement which would require the cities to
direct their waste stream to the county's landfill system in exchange for a fixed gate fee, In
the early 1990's attempts to effectuate such an agreement broke down over a variety of
issues after negotiations on a lengthy and detailed agreement.
In 1995, the county increased their gate fee (also known as tipping fees) for each ton of
trash from $22.75 to $35 in response to fewer tons deposited in the landfill system due to AB
939's recycling mandates and increased operating costs due to federal and state
environmental mandates. As a result of this action, our city's costs for landfill disposal of
residential refuse increased substantially and our city and others in the county began taking
trash to alternative disposal sites. As a result of this further loss in volume, the county in
March 1996 lowered their trash rate to its current level of $27 per ton.
These fluctuations in the landfill gate fee, coupled with the County's bankruptcy and the
initiation of importing refuse from outside Orange County, resulted in the county's exploration
of whether they should remain in the landfill business or sell the system and exit the
business altogether Due to the complexity of the issue, the County Board of Supervisors
early last year retained A.G. Edwards & Sons and Alexander Brown & Sons to prepare a
report on the strategic alternatives available to the county and then assess the relative
viability and time to carry out an alternative. Three basic alternatives were identified in the
report: 1) sell the system and exit the business; 2) retain the system without agreements
with cities, and 3) or retain the system with agreements with cities.
A small group of City Managers within the county were appointed to review the study and
recommend which alternative would be in the best interests of cities. This group, the Solid
Waste Working Group (SWWG), identified three primary city interests which guided our
discussions. These city interests included: a stable and reliable gate fee, long term
disposable capacity of county residents, and continued high quality environmental operation
of the landfills to protect public health and safety. The conclusion of the SWWG was that
these objectives could best be achieved by continued county ownership of the system with
long term agreements with the cities to give certainty to the county revenue stream and the
gate fee paid by cities and ultimately the taxpayer. The SWWG retained an independent
consultant, Hilton Farnkopf and Hobson of Newport Beach, to review the study prepared by
the county as to the accuracy of its assumptions, particularly the forecasts for in -county
refuse volumes/out-of-county import volumes/and attending financial impacts prior to coming
0023394.01
-3-
03106197 4.16 PM
l
REQUEST FOR COUNCIL ACTION
MEETING DATE: March 17, 1997 DEPARTMENT ID NUMBER:
to our final conclusions on the county's strategic alternatives analysis. The Orange County
Division of the League of Cities concurred with the recommendation to retain the system and
the County Board of Supervisors agreed on November 20, 1996 to give cities 90 days, or
March 1, to enter into a long term agreement with the county. At the end of 90 days, if the
parties were unable to reach agreement, then the county would proceed to sell the landfill
system.
With a short time frame to negotiate a complex and challenging agreement which had failed
in the past, the SWWG and county IWMD staff negotiated an MOU which included the major
deal terms. The MOU was reached on Christmas Eve 1996 and was subsequently approved
by the Orange County Division of the League of Cities. Since the first of the year, a
subcommittee of the SWWG including representatives from the Orange County City
Managers' SWWG and the Orange County City Attorneys' Association have been
negotiating the detailed agreement which comports to the terms of the MOU. In early
February, agreement was reached by the negotiators on a Waste disposal Agreement. The
agreement will now be presented to all the cities for action prior to consideration by the
board of supervisors. The deadline to act on the agreement has been extended to March 30
to give cities sufficient time to review the document_ Last week, a joint meeting of the City
Managers and City Attorneys was conducted to review the document and answer questions.
A few minor issues were addressed which resulted in several changes to the final document
which is attached for your review.
The proposed agreement between the County of Orange and the cities within Orange
County, who are willing to guarantee waste flow control, will contain the following deal points:
1. A ten (10) year fixed gate fee rate of $22 as opposed to the existing $27 [Section
4.2 (a)]. Pg 19
2. City of Huntington Beach guarantees to have 100% of its waste delivered to the
county [Section 3.1 (a)]. Pg 12
3_ Contract rate can be adjusted for defined reasons [Section 4.2] Pg 19:
a. uncontrollable circumstances
b. inflation in excess of 4%
C. costs to remediate conditions under CERCLA
d. tonnage shortfalls
4. Procedure for rate adjustment [Section 4.2 (g)]. Due process procedure if
participating cities with more than 50% of the county acceptable waste dispute the
county rate adjustment. Pg 21
1
0023394.01 -4- 0311019711:46 AM_.
REQUEST FOR COUNCIL ACTI N
MEETING DATE: March 17, 1997 DEPARTMENT ID NUMBER:
5. If actual in -county tonnage falls below the cumulative target, the county may utilize
certain remedies in the following priority [Section 4.2 (b)] Pg 19:
a)
reduce costs
b)
increase imported tonnage
c)
use unrestricted reserves
d)
adjust in -county rates
e)
terminate this agreement
f)
exit the landfill system
6 County may import waste tonnage adequate to receive at least $15 million per year
[Section 3 6 (c & e)]. Pg 17 & 18
7. if import tonnage falls below the targeted amount to achieve $15 million per year,
the following remedies will be utilized in the following priority [Section 4.2 (c)] Pg 2&
a) reduce costs
b) increase net import tonnage
c) use unrestricted and/or restricted reserves
d) adjust in -County rates
e) terminate this agreement
8. Availability of contracts to other parties - sanitary districts, MRF's and transfer
station operators, and haulers for waste not subject to city franchise agreements,
who are willing to commit 100% of their waste stream shall be offered the same
terms. Rates for non -contract customers - a separate and higher rate will be offered
to them. [Section 3.6 (a & b)] Pg 17
9. County to provide CERCLA indemnification as an "arranger" of municipal solid
waste [Section 7.31. Pg 32
The County Board of Supervisors and the Orange County League of Cities have agreed to
have agreements in place in enough of the agencies to attain the minimum in -county
tonnage by March 31, 1997.
In order for the City of Huntington Beach to comply with the Waste Disposal Agreement, it is
necessary to amend the Franchise Agreement with Rainbow Disposal. Staff has negotiated
the attached Supplement No. 2 to the Refuse Collection and Disposal Services Franchise
Agreement with Rainbow Disposal and Rainbow Transfer and Recycling Companies.
Not Applicable.
0023394.01 -5- 03/10197 11:46 AM
REQUEST FOR COUNCIL ACTION
MEETING DATE: March 17, 1997 DEPARTMENT ID NUMBER:
1. Do not approve the agreement as proposed.
2. Approve the agreement with amendments.
1 _ Waste Disposal Agreement between the County of Orange and the
City of Huntington Beach.
2. Franchise Hauler Acknowledgment.'
3. Ordinance No. -33qq approving Supplement No. 2 to Refuse
Collection and Disposal Services Franchise Agreement.
4. Slide presentation dated 2/24/97 entitled Orange County Solid Waste
Flow Agreement.
MTU-RS:fp
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