HomeMy WebLinkAbout1999-08-08 City CouncilTO:
City of Palo Alto
City Manager’s Report
FROM:CITY MANAGER DEPARTMENT: ADMINISTRATIVE
SERVICES
DATE:FEBRUARY 8, 1999 CMR:133:99
SUBJECT:MEMORANDUM OF UNDERSTANDING BETWEEN PALO ALTO
SANITATION COMPANY (PASCO)AND THE CITY OF PALO ALTO
REPORT IN BRIEF
This report transmits to the City-Council a proposed memorandum of understanding (MOU)
between Palo Alto Sanitation Company (PASCO) and the City of Palo Alto and Amendment
Number 12 to the contract with PASCO.for refuse collection and recycling services.
At the November 16, 1998 City Council meeting, Council directed staff to enter into
discussions with PASCO to address the City’s concerns regarding a new refuse and recycling
agreement. In addition, Council directed staff to negotiate an MOU with PASCO before
March 1, 1999, which would cover the agreed-upon scope and time frame for finalizing a
new agreement. Finally, Council granted staff the authority to give notice to PASCO
regarding the City’s intent to terminate its existing agreement as of June 30, 2004, which
would trigger the City to.prepare a Request for Proposals to solicit a vendor to provide refuse
Collection and recycling services. Staff was directed to issue the notice of intent to sunset
the agreement, if the MOU has not been negotiated and presented to Council for approval
prior to March 1, 1999.
Staff and PASCO came tO an agreement regarding a proposed MOU. As part of this
discussion, the two parties agreed that it was prudent to amend the current agreement to
extend the last day by which the city can exercise its right to sunset from March 1, 1999 to
September 1, 1999.
CMR:133:99 Page 1 of 4
RECOMMENDATION
Staff recommends that Council: 1) approve the attached MOU; 2) approve Amendment
Number 12 to the 1987 Refuse and Recycling Agreement (1987 Agreement) to extend from
March 1, 1999 to September 1, 1999 the date by which the City must give notice of its intent
to terminate the agreement effective June 30, 2004; and 3) direct staffto continue negotiating
a new agreement with PASCO, which would be presented to Council prior to September 1,
1999~
BACKGROUND
At the November 16, 1998 City Council meeting, staffwas directed by Council to negotiate
a MOU with PASCO, which would define the terms under which the City and PASCO would
agree to negotiate, in good faith, a new refuse and recycling agreement. Staffwas also given
the authority to sunset the existing agreement with PASCO (the existing sunset deadline is
120 days prior to June 30 of any year), ifa MOU that was satisfactory to the City could not
be agreed to by March 1, 1999.
Prior to the sale of Paul Madsen’s shares of stock in PASCO to USA Waste/Waste
Management in August, 1998 staff was in the process of negotiating the terms of a new
agreement with PASCO. Upon receipt of notification ~om Paul Madsen of his intent to sell
his shares of PASCO to USA Waste/Waste Management, the negotiation process was put on
hold.
The acquisition of PASCO by USA Waste/Waste Managementwas finalized as of November
30, 1998. Upon Council approval of the Proposed MOU and Amendment Number 12 to the
1987 Agreement, staffwill resume negotiations with PASCO regarding a new contract, with
the intent to have a new contract available for Council review prior to September 1, 1999.
During the preparation of the MOU, staff felt that it would be prudent to extend the annual
notice of termination deadline from March 1, 1999 to September 1, 1999, to allow more time
to complete the negotiation process. The extension will give staff six additional months to "
complete negotiations. However, if by August 1, 1999, PASCO has not signed and
submitted the proposed new agreement to the City, the MOU will be terminated (unless
mutually extended in writing by both parties). Staff would then propose to issue a
notifacation of intent to terminate prior to September 1, 1999. Upon the City’s notification,
the 1987 Agreement would terminate effective June 30, 2004.,
CMR:133:99 Page 2 of 4
The main items in the attached MOU include:
the intent to negotiate (but no present obligation for either party to commit to) a fully
integrated contract, which may include terms relative to contract length, compensation
methodology and scheduling, solid waste and recycling programs, performance-
related issues, long-range facility planning, including the lease of the Geng Road
facility, and AB 939 requirements;
an agreement that the 1987 Agreement will remain in effect with no change in
compensation for fiscal year 1999-2000, except as related to employee labor costs;
and ~’
agreement that the MOU will be terminated by August 1, 1999.
RESOURCE IMPACT
There are nominal costs involved in approving this MOU. These costs result from the
proposal to allow the employees of PASCO to receive their annual cost of living
compensation adjustment. This provision would be included in the new agreement and
would not be effecetive until a new agreement were approved by the City Council. However,
if a new agreement can not be reached, staff would propose amending the existing agreement
with PASCO to cover these costs.
POLICY IMPLICATIONS
Recommendations are consistent with existing City policies.
ATTACHMENTS
Attachment A: Memorandum ofUnders .tanding
Attachment B:Amendment Number 12 to the 1987 Agreement between the City and
PASCO
CMR:133:99 Page 3 of 4
PREPARED BY: Karen Gissibl, Executive Assistant, Operations Division
DEPARTMENT HEAD APPROVAL:
CARL YEATS/
Director, Adm~istrative Services
DEPARTMENT HEAD APPROVAL:
CITY MANAGER APPROVAL:
CC:N/A
GLENN S. ROBERTS
t2ity Manager ~
CMR:133:99 Page 4 of 4
ATTACIqMENT A
This Me/~.orandum of Onderstandlng ("MOU") is entered intothis’~_~day of _~//~ , 1999, by and between the CITY OF PALO
ALTO, a California Municipal Corporation ("CITY"), and PALO ALTO
SANITATION COMPANY, a California Corporation ("PASCO"),
as follows:
R E C I T ~ L S:
This:MOU is entered into on the basis of the following
facts, understandings and intentions of the parties:
A. CITY and PASCO have previously entered into an
agreement for refuse collectlon and recycling date~ March 9, 1987,
as amended up ~o and incl~ding the Eleventh Amendment thereto (as
amended, ~he "1987 Agreement"). The 1987 Agreement was the subject
of a detailed audit by the city Auditor in 1995, which report
recommended certain changes in the administration and
implementation of the 1987 Agreement; and
B. The parties agree to negotiate in good faith to
consider a new agreement for solid’w~;ste and recyclable materials
handling service~ (the "New Agreement"), that will reflect the
recommendations of the City Auditor ~nd the changes in ~he CITY’s
solid waste and recycling programs that have occurred since 1987;
and
C. The parties estimate that negotiation and
consideration of a New Agreement may take eight (8) months; and
D. To accom~od’ate this ne.~otiatlon period, the par~les
have executed Amendment No. Twelve to the 1987 Agreement of even
date herewiUh, extending from March I, 1999 to Septemb%r 1, 1999,
the last day in calendar year 1999 by which City.can exercise its
right to terminate the annual renewal oft~e" 1987 Agreement; and
E. .The parties desire to enter into this MOU to set
forth the commitmenn of the parties regarding negotiation of the
New Agreement, including a schedule i[or the negotiations.,
990201 ~| 00320~
4~ 4% 3737
650 :329 2646 P.
NOW, THEK~FOP4~, PASCO AND C~TY AGB~E TO THE FOLLOWING:
!.MUTUAL OBLIGATIONS
A.The parties agree to negotiate diligently and in
good faith, with the objective of agreeing on the terms and
conditions of a New Agreement by no 1~ter than August I, 1999. The
parties desire to present a mutually acceptable New Agreement tO
the Palo Alto City Council for approval at the firs~ regularly
scheduled Council meeting .in August, 1999, and desire to have the
New Agreement effective as of September I, 1999.
B. The parties agree to meet regularly and as often as
needed, commencing the second week of January, 1999.
C. The parties agree to review and respond to all
correspondence, drafts, and requests for i~for~ation and documents
as expeditiously as possible.
2.NEGOTIATORS
A.The negotiators for CITY shall be June Fleming, Carl
Yeats, Glenn Roberts, and Sue Case (the "CITY Negotiators").
Virginia Harrington and Karen Gissibl will also provide assistance
in the negotiation process. The ne~[otiators for PASCO shall be
Duane Woods, Andrea Stephenson, an~ Rich Buohner (the "PASCO
Negotiators"). The parties may chang~ their designated Negotiators
at anytime, ~p~n written notice to the other party.
B. The parties agree not to communicate with ’any
representative, officer, or employee of each other, other than the
designated CITY and PASCO Negotiators, during the term of
this MOU, regarding any aspect of th~ negotiations.
3. NOTECES, DEMANDS AND COMMUNICATIONS
A. The representatives of the parties who are primarily
responsible for the negotiation of the New.Agreement, and towhom
formal notices, demands and communications shall be
given, are as ’follows:
The Principal representative of CITY shall be City
Manager, June Fleming. Formal notice to CITY shall be directed to:
Carl Yeats
Director of Administrative Services
City of Palo
Post Office Box 10250
Palo Alto, California 94303
479 3737
850 329 2646
~009/020
P. 2
The principal representative of PASCO shall be:
Andrea Stephenson, Director,
Municipal Market Development
Waste Management
155 North Redwood Drive, Suite 250
San Rafael, CA 94903
B.All notices, demands and co~nications glve~
hereunder shall be in writing, and shall be personally delivered or
sent by registered or certified m~ii, postage pre-paid, return
receipt requested, or sent by na~ionally recognized courier tha~
uses an electronic tracking system, or sent by facsimile
transmission, and shall be deemed received upon the earlier of:
if personally delivered, the date of d,~llver~ to the address o~ the
person ~o receive s~ch no,Ice; (ii) if mailed, on the date of
delivery or attempted delivery as shown on the U.S. Postal Service
certified mail re~urn receipt; (iii) if sent by courier, on the
date of delivery or attempted deliveri~ as show~ on the records of
the courier service~ or (iv) if faxed,, when sent. Any notice,
request~ demand, direction or other cc.mmunlcation sent by ~a~ mus~
be co~firmed within forty-elght (48) hours by le~uer mailed or
delivered in accordance with the foregoing.
C. If the n~me of the principal representative and/or
the person designated to receive the notices, demands or
communications, or the address of such person(s>, is changed,
written ~otlce shall be given within ~ive (5) working days of the
cha~ge.
4. TERMS AND CONDITIONS
The parties desire that the New Agreement be a fully
integraued contract, addressing all terms and conditions necessary
to implement a high quality system for the collection and handling
of solid waste and recyclable materials. Anticipated terms and
conditions shall include, bu~ not be limited to: term, compensation
methodology, rate review scheduling, solid, waste and recyclable
materials programs and isaues, performance related issues
(including but not limited to performar~e bond, liquidated damages,
customer service and response times), long range facility plannlng,
including the lease of t~e Geng Road facility, and AB 939
requirements.
1987 AGREEMENT
Until such time that a New ~reement is execuhed by the
parties, the 1987 Agreement shall, remain in full force and effect.
The parties agree, however, than there will be no change in the
method or level o£ compensation for fiscal year 99-2000, prior to
thirty (30) days after the expiration of the term of this MOU.
990201 S~i 00"320~
41£ 479 3737
PASCO agEees that during the term of the MOU it will
forgo application for any rate or co~ensation adjustment allowed
under the 1987 Agreement# provided~ however, that any salary
related adJus~nen~ approved subsequent to the expiration of the MOU
shall be retroactive to July 1, 1999.
6. CHANGES IN LAW AND UNCONTROLLABLE CIRCUMSTANCES
Nothing in the MOU shall prohibit the application and
approval of revenue adjustments necessary to compensate PASCO for
increases in the cost of provldin~.~h~ services required under nh~
1987 Agreement, 0which are th~ result cf a change in law or even~ or
circumstance bsyond the control of ~he parties, such as but not
restricted to a force majeure event.
¯ - 7. TE~ OF MOU
~f by August I, 1999, PASCO has not signed and s~itted
the proposed New.Agreemen~ to CITY, this MOU shall~automatically
nerminane, unless mutually extended in writing by CITY and PASCO.
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650 329 2646 .,P. lO
8. LIMITATIONS OF THIS MOU
By its execution of this MOU, neither CITY or PASCO is
committing itself to or agreeing to enter into the New Agreement.
Neither party waives its right to ~nforce the provisions of
1987 Agreement,
Executed the date and year first stated above.
"DaLe:
PALO~LTO’SAN~TATION COMPANY,
a California Corporation
USA WASTE OF ¢~L~FORNIA, INC.,
a California Corporation
.Date:
CITY O}Y PALO ALTO, a California
Municipal CorporaTion
Date:
ATTEST:
Mayor
City Clerk
990~01 ~df o0~Z088
FEB- 4-99 THU 41~ 479 9737
C~RTIFICATE OF ACK~fOWLEDGMENT
(Civil Code ~ 1189)
STATE
COUNTY
On~"~t~A,..,."~.__.., 19~._~ b,~fore me, the undersigned, a
Notary P~bllc ~n ~nd fo~ said County and Sta~e, personally appeared
_ Douglas O. Sober and Ronald Law , perso~ally know~ to
me or proved to me on ~he basis of sa~isfac~ry.evidence
p6rson(s) whose name(s) is/are subscr:[bed ~o the w£~hin ins~rumen~
and acknowledged to me ~ha~ he/she/they executed ~he same in
his/her/~helr authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the p~rson(s), or ~he entity upon
behalf of which th~ person(s) acted, executed the instrument.
WITNESS my hand and official seal.
.Signature of ,tary Public
9g0201 edl 00321.08
479 3737 P. 4
FEB- 2-99 TUE 3:00 AM Polo Alto City ALtorney t~AX lqO. 650 329 2616 P. 2
ATTACHMENT B
~ENDMENT NO. ~ELVETO COntRACT NO. ~6~8,
AGREEMBNT BETWEEN THE CITY O~ PALOALTO AND
PALOALTO SANITATION COMRANY FOR REFUSE
COLLECTION ANDRECYCLING
This Amendment No. Twelve (~’Amendment") to Contract No.
4688, by and between the CITY OF PALOALTO, a California municipal
corporation (~CITY"), and PALO ALTO SANITATION COMPANY,
CallfornJ (~PASCO~), is made and entered into.this
day of 1999...
RECITALS
This Amendment is entered into on the basis of the
f?~1owing facts, understandings and intentions of the parties:
A. CITY and PASCO have :previously entered into an
agreement for re~use collection and r~cycllng dated March 9, 1987
(Contract No. 4688), as amended up no and including Amendment No.
Eleven (as amended, the ~1987 Agreement"); and
B. As more specifically described in ~hat certain
Memorandum of Understanding ("MOU-) of even date herewith, the
parties desire to negotiate in ~ood faith to consider a new
a~reement for solid waste and recyclable materials handling
services (the ~New Agreement") on or before September i, 1999; and
c. In order to facilitate ~:he negotiations provided for
in the MOU. the par~ies desire to extend the 1999 date by which the
CITY must give notice in order to te~sinate the 1987 Agreement.
NOW, THEREFORE, the par~ies agree as followm:
~. Notwithstanding Paragraph 2 of the 1987
Agreement, for the year 1999 only, CITY may deliver written no~ioe
terminating the annual .renewal of the 1987 Agreement up to and
. including Septembe~ i, 1999. Any such notice delivered on or
before September I, 1999 shall have th~ sam~ effect as if delivered
one hundred twenty (120) days before June:B0, 1999. Thus, any
notice of~termlnation delivered to PASCOon or. before September I,
19~9 shall serve to terminate the 1987 Agreemen~ effective June 30,
2004. After September I, 1999, no~ice shall be given as s~ated in
Paragraph 2 of the 1987 Agreement, or~e hundred ~wenty (120} days
before J~ne 30 o£ any year.
//
//
//
479 3737 P. 5
~. Except as specifically amended herein, the
1987 Agreement shall remain in full for~e and effect.
IN WITNESS WHERE0~, the parties hereto have by their duly
authorized representatives executed t~is Amendment to Contract on
the date first above written.
ATTEST:C~TY OF PA~OA~TO
City Clerk ,,Mayor
.ApPRO~D AS TO PALOKLTO SANITATION C~MP~/~Y
A California Corporation
Senior Asst. City Attorney
APPROVED:
Assistant city Manage’~ .......
Director of Administrative
Services
Director of
Risk Manager
USA WASTEOFCALZFORNIA,
A Ca,lifoznia Cozpo=ation
By:
Name
Taxp, ayer Identification No.
Attachments :
EXHIBIT’ "A" :
EXHIBIT "B" :
EXHIBIT "C" :
EXHIBIT "D" :
(Compliance w~th Co~, Code $ 313 t~required if the entity on whose behalf
this =ene~ec~ ~s sLgned ks a ~o:poza~ion.
resolution attes~in~ ~o the signatory
SCOPE OF PROJECT &TIME SCHEDULE
RATE SCHEDULE
INSURANCE
NONDISCRIMINATION COMPLIANCE FORM
~90~01 sdl 0032100
4-99 T:4U 2:57 415 479 3737 P.
CERTZFXCATE OF ACKNOWLEDGMENT
(Civil Code ~ 1189)
STATE OF ~ )
Notary Public in. and fdr said Coun£y and State, personally appeared
D61|£1a~ c. sohev% Rnn~IH T.~w , personally known to
me or proved t6 me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within instrument
a~d acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the ent£ty upon
behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature of ary Public
4[5 479 3737