HomeMy WebLinkAboutStaff Report 14834 (2)
City of Palo Alto (ID # 14834)
City Council Staff Report
Meeting Date: 12/12/2022 Report Type: Consent Calendar
City of Palo Alto Page 1
Title: Approval of Amendment No. 1 to Contract C09124501 with GreenWaste
of Palo Alto for Collection and Processing Services to Implement Domestic
Recycling of Mixed Paper and Mixed Rigid Plastics with Program Annual Costs
Not to Exceed $1.2M; and Approval of Budget Amendment in the Refuse
Fund
From: City Manager
Lead Department: Public Works
Recommendation
Staff recommends that Council:
1. Approve and authorize the City Manager or their designee to execute Amendment
No. 1 to Contract Number C09124501A with GreenWaste of Palo Alto to implement
Domestic Recycling of Mixed Paper and Mixed Rigid Plastics with program costs not
to exceed a total of $1,200,000 annually; and
2. Amend (by a 2/3 majority) the Fiscal Year 2023 Budget Appropriation for the Refuse
Fund by:
a. Increasing Utilities Purchase funding for Collection/Hauling/Disposal
Administration by $500,000; and
b. Decreasing the Rate Stabilization Reserve Balance by $500,000.
Executive Summary
Prior to a three-month pilot program at the end of Fiscal Year 2022, approximately 60 percent
of Palo Alto’s recyclables were sent to international markets where their fate and any negative
impacts were largely unknown. In 2021, Council directed staff to work on finding alternative
solutions to sending recyclable materials to be marketed and processed internationally. Since
then, staff and the City’s contracted refuse hauler, GreenWaste of Palo Alto (GWPA), found
domestic markets for mixed paper (MP) and mixed rigid plastics (MRP) and conducted a three-
month pilot program to utilize these U.S. markets. The pilot program was successful, and staff is
recommending that Council approve a contract amendment and the associated costs to continue
this program through June 30, 2026, when the Contract with GWPA ends. This action for MP and
MRP will lead to about 61 percent of the City’s total recyclable materials staying in the United
States, reducing the amount being exported to 39 percent, with mostly cardboard being sent
internationally. Staff believes this will place the City in a leadership role nationally in preventing
unintended consequences of shipping plastic and mixed paper recyclables internationally.
City of Palo Alto Page 2
Background
GreenWaste of Palo Alto (GWPA) is the City’s refuse hauler for collecting recyclable,
compostable, and landfill materials, and processing recyclable and compostable materials. On
January 22, 2019, Council approved the Second Amended and Restated Agreement with GWPA
(Staff Report #9752). This amendment facilitated the implementation of multiple initiatives
identified in the 2018 Zero Waste Plan, replaced old waste collection vehicles, and extended
the agreement five years to end June 30, 2026. The amendment also designated a new cost
methodology for the processing of recyclable materials to be based on tonnage collected and
processed and for a new profit-sharing procedure on the recyclable materials which began in
Fiscal Year 2022.
Palo Alto’s recyclable materials are processed at the GreenWaste Materials Recovery Facility in
San Jose, where they are combined with recyclables from other communities, separated by
type, baled, and marketed. The City requires GWPA to report on the disposition of recyclable
materials as well as to gather information on the environmental and social implications
associated with the further offsite marketing and processing of Palo Alto’s recyclable materials.
For Fiscal Year 2021, GWPA reported (Staff Report #13535) that approximately 14,000 tons of
recyclable materials were collected from Palo Alto, with about 40 percent staying in the United
States and 60 percent being exported to India, Indonesia, Korea, Malaysia, Mexico, Taiwan,
Thailand, Vietnam, Mexico and other countries. For the last three years, GWPA has provided
the City with traceability reports; however, the reports do not explain exactly which shipments
go to which cities or facilities within those countries. GWPA has tried to ascertain from its
recyclable materials brokers which international facility is receiving and processing Palo Alto’s
recyclables, but the market information is considered confidential. Therefore, it has not been
possible to determine with certainty how much of the materials are being recycled, if the
materials are being managed in an environmentally sound way, or whether the conditions at
the international locations are causing any human health or social problems. The GWPA
Traceability Report for Fiscal Year 2022 is consistent with past reports and provides updates on
the GWPA and City collaborated pilot programs.
Council discussed these concerns on May 24, 2021 (Staff Report #11632) as part of the new
solid waste processing contract and directed staff to:
1) Pursue, with other cities, a greater accounting of GreenWaste’s secondary
markets;
2) Return to Council with an amendment to the GWPA Contract to authorize a quick
response to opportunities to utilize domestic mixed paper recycling;
3) Provide GreenWaste reports to the public and City Council on a regular basis;
4) Work with other cities on legislation to spur domestic or in-state recycling; and
5) If GreenWaste is unable to provide additional secondary market accounting, return
to Council for consideration of further actions.
Staff provided an update to Council on each of these directives on January 24, 2022 (Staff
Report #13535). On May 2, 2022, Staff Report #14169 outlined a three-month pilot program
City of Palo Alto Page 3
conducted where MP and MRP were processed in Northern Louisiana and Southern California
respectively, instead of being sent to international markets. MP includes a mixture of paper
collected curbside from residents and businesses such as magazines, colored paper, and cereal
boxes. MRP are primarily plastics #2 through #7 including milk crates, buckets, and toys.
Cardboard was not selected as a material to be kept domestically since it is high quality,
contains low contaminants, is desired by processing facilities, and has consistent market
demand. The pilot was quite successful, and GreenWaste’s private sector processors are willing
to continue the arrangements.
As directed by Council in #1) above, staff has worked with other cities in an attempt to obtain
definitive information about the disposition and impacts of recyclables overseas. Few cities
have spent the time and energy that Palo Alto and GWPA have on this issue, and it is now
apparent that GWPA, and other haulers, are unable to obtain this information due to
recyclables brokers and processors considering it to be trade secrets and confidential.
Therefore, staff returned to Council on June 6, 2022 (Staff Report #14464) to propose further
action, as directed above. Staff proposed, and Council directed, that staff negotiate a contract
amendment with GWPA for to $1.2 million annually to provide domestic processing and
management of MP and MRP materials.
Discussion
GWPA has identified domestic processing facilities to take Palo Alto’s MP and MRP where they
will become new products, rather than sending them to international markets where their
processing, disposition and impacts are uncertain. It has been very difficult for GWPA to find
domestic markets for several recyclables, including cardboard, mixed paper, and plastic, since
capacity at U.S. processing facilities for these recyclables is very limited. In addition, as staff
continues its engagement with other cities, jurisdictions, and legislators to increase the
awareness of the environmental and social concerns with shipping and processing of recyclable
materials internationally, demand on domestic capacity for processing of recyclables will
increase.
Staff and GWPA developed an ongoing program to take MP and MRP to processing facilities
within the United States and negotiated a corresponding contract amendment (Attachment A).
MP is going to a pulp and paper mill in Louisiana to be combined with other wood products and
made into paperboard, printing paper, and other paper products within the U.S. MRP is being
cleaned, processed, and becoming part of a feedstock for making bits of plastic often called
“nurdles” which are then made into various plastic products in southern California including
paint buckets, vehicle parts, and woven plastic items such as upholstery, bags, and rope. These
are the same domestic markets and materials accepted in the Fiscal Year 2022 three-month
pilot program, which excluded cardboard. Cardboard is also not included in the ongoing
program because it is less likely to be mismanaged since it is a commonly high-quality product
with little contamination and a high recyclability. The added cost would have also been too
great at this time. In Fiscal Year 2023, it is estimated that approximately 3,800 tons of MP and
230 tons of MRP will be sent to these domestic processors instead of international markets.
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This action for MP and MRP will lead to about 61 percent of the City’s total recyclable materials
staying in the United States, reducing the amount being exported from 59 percent to 39
percent, with almost all of the exported material being cardboard.
Most importantly, international shipments of plastics, the recyclable of greatest concern, are
essentially being eliminated. Virtually all plastics will be processed in North America. Table 1
provides a list of the common recyclable materials categories, breakdown percentages
estimated for Fiscal Year 2023 based on Fiscal Year 2022 numbers and destination of where
they are being marketed for processing. Of all the types of plastic, only clamshell food
containers (a subset of # 1 PET Plastic) are still being managed outside the U.S. in Mexico at
known processing locations where problems can be identified. The exception to these
destinations will be any short-term market disruptions due to economy disfunctions and when
shipment of materials to target locations cannot be made due to uncontrollable circumstances.
Table 1: Recyclable Materials Breakdown & Processing Destination,
Estimated for Fiscal 2023 based on Fiscal Year 2022 Data
Material Type Material
Breakdown Domestic Export
Aluminum 1.3% 100% 0%
Other Metals 8.0% 100% 0%
Glass 22.4% 100% 0%
Plastic 7.7% 92% 8%
Mixed Rigid Plastic 1.5% 100% 0%
Mixed Paper 16.8% 100% 0%
Cardboard 42.2% 10% 90%
E-Waste 0.1% 100% 0%
Resource Impact
The program cost for domestic processing of MP and MRP is estimated not to exceed
$1,200,000 annually. The Fiscal Year 2023 Adopted operating budget for the Refuse Fund
included a placeholder of $700,000 to support the domestic recyclables processing. To meet
the not-to-exceed annual amount of $1,200,000, staff recommends an appropriation of
$500,000 in Fiscal Year 2023 in the Refuse Fund as part of this report. Staff also recommends
continuing this program during the remaining term of the GWPA contract which ends in June
2026, with the associated annual expense of $1,200,000 for the subsequent years to be subject
to appropriation of funds through the annual budget process.
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Table 2 indicates the approximate average cost per customer for domestic processing of MP
and MRP. For the typical residential customer, this equates to 5.5 percent of the monthly bill.
The last increase to Refuse Rates occurred in 2017, and staff is currently analyzing whether an
increase will be proposed for Fiscal Year 2024.
Table 2: Estimated Average Additional Cost per Residential and Commercial Customer
Estimated Additional Cost Residential Commercial
Subtotal based on tonnage $600,000 $600,000
Average cost per customer per year $33.46 $323.10
Average cost per customer per month $2.79 $26.93
Stakeholder Engagement
The current stakeholder engagement includes conducting several virtual forums with other
cities and jurisdictions focusing on increasing the knowledge of the environmental and social
issues that international shipping of recyclables may be causing, sharing information as well as
exploring solutions. These forums were initiated by Palo Alto staff and are being co-sponsored
by the City of San Jose. City Council Meetings have also proven to be important community
engagement vehicles with members of the public expressing concerns about international
shipments of recyclables and Council and staff have responded with actions.
Policy Implications
The program is also consistent with the City’s Environmentally Preferred Purchasing Policy,
which states that the City shall incorporate environmental, economic and social stewardship
criteria into its purchases of products and services, and more specifically minimizing the City’s
contributions to global warming, solid waste, local and global pollution, and toxic chemical
exposures to people and the environment. In addition, the program aligns with the
Sustainability and Climate Action Plan (S/CAP) Update, which proposes a Zero Waste Key Action
to prioritize domestic processing of recyclable materials.
Environmental Review
Council action on this item is exempt from review under the California Environmental Quality
Act (CEQA) because it can be seen with certainty that redirecting recyclables from international
to domestic facilities will not have a significant effect on the environment, i.e., a substantial or
potentially substantial adverse impact on the environment. CEQA Guidelines Section
15061(b)(3)
Attachments:
• Attachment A - Amendment 1 to GWPA Contract No C09124501A
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Amendment No. 1 TO CONTRACT NO. C09124501A
SECOND AMENDED AND RESTATED AGREEMENT FOR SOLID WASTE, RECYCLABLE MATERIALS,
AND COMPOSTABLE MATERIALS COLLECTION AND PROCESSING SERVICES
BETWEEN THE CITY OF PALO ALTO AND
GREENWASTE OF PALO ALTO, LLC
This Amendment No. 1 (“Amendment”) to Contract No. C09124501A (the “Contract” as defined
below), is effective as of December 12, 2022 by and between the CITY OF PALO ALTO, a California
chartered municipal corporation (“CITY”), and GREENWASTE OF PALO ALTO, LLC, a California limited
liability company (“Contractor” or “GWPA”), located at 610 E. Gish Road, San Jose, CA 95112. The City
and Contractor are occasionally herein referred to each as a “Party” and collectively as the “Parties.”
RECITALS
This Agreement is entered into on the basis of the following facts, understandings and
intentions of the Parties:
1. The City of Palo Alto and GreenWaste of Palo Alto entered into the Contract entitled
"the Second Amended and Restated Agreement for Solid Waste, Recyclable Material, and Compostable
Materials Collection and Processing Services" on January 22, 2019.
2. The Contract contains a number of provisions intended to implement initiatives in the
City's 2018 Zero Waste Plan, including an annual report on the disposition of recyclable materials and
related information on the environmental and social implications of the processing and sale of
recyclable materials collected from solid waste customers in the city.
3. On June 6, 2022 the Palo Alto City Council directed City staff to negotiate a contract
amendment under which GWPA would implement a program to prioritize the processing, marketing,
and selling mixed paper and mixed rigid plastic to domestic, rather than international, markets.
4. The purpose of this Amendment is to implement a new program to maximize the use of
domestic markets, as opposed to international markets, for sorted recyclables from Palo Alto. This
Amendment contains additional definitions, additional compensation to Contractor for this new
program, and new reporting requirements to document the materials management. The program
enhances the City’s ability to be informed of environmental, human health, or social impacts occurring
during materials management downstream of the Contractor.
OPERATIVE PROVISIONS
NOW, THEREFORE, in consideration of the mutual promises, covenants, and conditions contained in this
Amendment and for other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Parties agree to amendment the Contract as follows:
SECTION 1. Interpretation. Capitalized terms used in this Amendment will have the same meanings
specified in Attachment A of the Contract unless expressly provided otherwise in this Amendment.
SECTION 2. Amendment Definitions. The following definitions shall apply to this Amendment:
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a) “Processing” or “Processed” shall mean the sorting of Recyclable Materials by the
Contractor.
b) “Sorted Recyclables” shall mean Recyclable Materials sorted and produced by the
Contractor which can be recycled by a downstream provider
c) “Materials Management” shall mean the handling and use of the Sorted Recyclables
after Processed by Contractor at its Facilities as specified in Section 3 of this Amendment.
d) “Mixed paper” or “MP” shall mean magazines, catalogues, envelopes, junk mail,
paperboard, shredded paper, non-metallic wrapping paper, Kraft brown bags and paper, paper egg
cartons, office ledger paper, self-stick notes, and telephone books.
e) “Mixed Rigid Plastic” or “MRP” shall mean plastic containers (#1-7 including containers
made of HDPE, LDPE, PET, or PVC), kids toys, buckets.
f) “International” shall mean territory outside the United States of America.
g) “Domestic” shall mean territory inside the United States of America.
SECTION 3. Materials Management.
a) Market and sale of MP and MRP. Contractor shall undertake commercially reasonable
efforts to market and sell the City’s MP and MRP materials domestically. If no Domestic markets exist,
Contractor will notify City of alternative markets and proposed new destinations. The proposed
destinations may be International. City will then provide direction to Contractor as needed on the
recommended selected destination. In providing direction with respect to International destinations,
City will consider the use of best environmental practices, the ability to trace the new Material
Management destination, and price. Contractor will determine the amount of MP and MRP materials to
market and sell domestically on (1) the actual tonnage of single stream Recyclable Materials delivered
from the City to the GreenWaste MRF, and (2) the percentage of MP and MRP, respectively; based on
the rolling average of the last three waste characterization audits of single stream Recyclable Materials
from the City’s material that are delivered for Processing at the GreenWaste MRF.
b) Single Stream Recyclable Materials Waste Characterization Audit. Contractor shall
perform a minimum of two waste characterization audits per year on single stream Recyclable Materials
from the City that are delivered for Processing at the GreenWaste MRF. Waste characterization audits
shall be performed in accordance with the methodology provided in Section 3(c) of this Amendment at a
time determined by mutual agreement between Contractor and the City and/or the City consultant.
Contractor will coordinate and schedule these audits with the City. Representatives from the City, the
Contractor, and/or City’s consultants may also participate and observe the audits. Audits shall be
performed one in spring and one in fall of each year. Once a date has been selected, the Contractor and
City will collaborate to identify route(s) in order to secure a target volume of 30 tons per audit. Loads
will be taken from different routes or truck numbers representing a typical breakdown between both
commercial and residential sectors and different Collection days.
c) Single Stream Recyclables Waste Characterization Audit Methodology. Contractor will
conduct waste characterization audits using the following methodology:
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1. Prior to each waste characterization audit, all bunkers at the GreenWaste MRF
will be cleaned out such that they are free of material; and the selected volume of single stream
Recyclable Materials from City will be delivered by the Contractor and weighed on the inbound scale.
2. The single stream Recyclable Materials from Contractor’s collection vehicles will
be unloaded on the floor of the GreenWaste MRF.
3. Recyclable Materials will then be “fed” onto the Processing line.
4. Recyclable Materials, by type, and residue will be sorted out and are placed in
the appropriate bunker(s) and/or bin(s).
5. Recyclable Materials from bunker(s) and/or bin(s) will be removed and weighed
individually.
6. Contractor will compile the data into a report that may include, but not be
limited to, the tonnage information by commodity. The commodities include paper, cardboard, plastic,
glass, metal, e-waste, residue, and any other categories as applicable.
d) Use of Audit Data; Residue. The data from audits provided herein shall be used to
calculate the percentage of MP and MRP in the City’s single stream recyclables. The residue within the
MP amount will be kept to a minimum and not more than 2%.
e) Targeted Tons. The MP and MRP individual percentages from waste characterization
audits hereunder will be used to determine the target tonnage for MP and MRP that Contractor will
attempt to deliver to domestic markets calculated as follows:
1. 𝑅𝑎𝑟𝑎𝑎𝑟𝑎𝑎 𝑀𝑃 𝑅𝑘𝑘𝑟 𝑟𝑘 𝑎𝑎 𝐶𝑎𝑘𝑖𝑟𝑎𝑟𝑎𝑎 𝑟𝑘 𝐶𝑘𝑘𝑎𝑟𝑟𝑖𝑎 𝑀𝑎𝑟𝑘𝑎𝑟𝑟=
𝐴𝑎𝑟𝑟𝑎𝑘 𝑅𝑘𝑘𝑟 𝑘𝑎 𝑅𝑖𝑘𝑎𝑘𝑎 𝑅𝑟𝑟𝑎𝑎𝑘 𝑅𝑎𝑎𝑦𝑎𝑘𝑎𝑎𝑘𝑎𝑟 𝑎𝑘𝑘𝑘𝑎𝑎𝑟𝑎𝑎 𝑎𝑟𝑘𝑘 𝐶𝑖𝑟𝑦× 𝑃𝑎𝑟𝑎𝑎𝑘𝑟𝑎𝑎𝑎 𝑘𝑎 𝑀𝑃
2. 𝑅𝑎𝑟𝑎𝑎𝑟𝑎𝑎 𝑀𝑅𝑃 𝑟𝑘 𝑎𝑎 𝑅𝑘𝑘𝑟 𝐶𝑎𝑘𝑖𝑟𝑎𝑟𝑎𝑎 𝑟𝑘 𝐶𝑘𝑘𝑎𝑟𝑟𝑖𝑎 𝑀𝑎𝑟𝑘𝑎𝑟𝑟=
𝐴𝑎𝑟𝑟𝑎𝑘 𝑅𝑘𝑘𝑟 𝑘𝑎 𝑅𝑖𝑘𝑎𝑘𝑎 𝑅𝑟𝑟𝑎𝑎𝑘 𝑅𝑎𝑎𝑦𝑎𝑘𝑎𝑎𝑘𝑎𝑟 𝑎𝑘𝑘𝑘𝑎𝑎𝑟𝑎𝑎 𝑎𝑟𝑘𝑘 𝐶𝑖𝑟𝑦× 𝑃𝑎𝑟𝑎𝑎𝑘𝑟𝑎𝑎𝑎 𝑘𝑎 𝑀𝑅𝑃
SECTION 4. Compensation.
a) General. Contractor shall be entitled to additional compensation for the increased
expense associated with Domestic Materials Management. The parties acknowledge that Domestic and
International prices for MP and MRP are determined by multiple factors including proximity to ports,
quality of material, currency exchange, length of contract period, and market availability; and that actual
prices Contractor receives from processors or brokers is affected by all these factors. Notwithstanding
the foregoing, except as provided herein, this Amendment will not be construed as affecting
compensation to Contractor described in Section 9.06 of the Contract, Compensation for Recyclable
Materials or Attachment U, Recyclable Materials Profit (Loss) Methodology.
b) Mixed Paper (MP). Compensation to Contractor will be computed by the formulas
below for MP.
A = (IP) (T)
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Description Variable
Contractor’s Adjusted Opportunity Cost A
International Price
($/ton from actual Contractor sales)
($150 for July 2022)
IP
Actual MP Tons Delivered to Domestic Markets T
B = -(DP) (T)
Description Variable
Cost to Deliver to Domestic Mill B
Domestic Price
($/ton from actual Contractor costs)
(-$125 for July 2022)
DP
Actual MP Tons Delivered to Domestic Markets T
MP Compensation to Contractor = A + B, or
MP Compensation to Contractor = (IP - DP) * (T)
For Fiscal Year 2023, the Domestic price for MP is the difference between the Mixed Paper Price
from the Pulp & Paper Producer Price Index published monthly by Fastmarkets RISI in Pulp &
Paper Week (PPI) and the Brokerage fee. In subsequent Fiscal years this method of calculation of
the Domestic Price may be changed by mutual agreement between City and Contractor. For
illustrative purposes, in August 2022, the Southeast Mixed Paper price PPI published was $45,
given that MP was sent to Louisiana. The maximum brokerage fee for Fiscal Year 2023 is
$170/ton. Resulting in -$125 per ton for Domestic Price for the previous month, July 2022.
The International price shall be determined monthly by the actual sales of materials. If there are
no International sales in a particular month, the International price shall be determined by the
sales from the previous month.
Example for July 2022:
International Price = $150; Domestic Price = -$125;
Actual MP Tons Delivered to Domestic Markets = 313.605 tons
MP Compensation to GW = $150 - (-$125) * 313.605 tons = $86,241.38
Contractor shall report the actual tonnages delivered to Domestic markets and calculate the
City’s compensation to Contractor on a monthly basis and itemize it in the monthly invoice. The
actual MP Tons Delivered to Domestic markets in the compensation calculation shall not exceed
the targeted MP Tons as determined in Section 3(e) of this Amendment. Contractor shall
indicate the appropriate MP prices used based on location from PPI for the compensation
calculation. Contractor shall provide the City:
(1) Copies of purchase orders and proof of monthly payment received from the
International sale of MP
(2) Copies of monthly invoices and payments to the domestic mill for MP delivered
(3) Copies of the complete PPI for both the Domestic and export indexes on a monthly
basis
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(4) Copies of documentation indicating the Domestic brokerage fee, if applicable
c) Mixed Rigid Plastics (MRP). Compensation to Contractor will be computed by the
formulas below for MRP.
A = (IP) (T)
Description Variable
Contractor’s Adjusted Opportunity Cost A
International Price
($/ton from actual Contractor sales)
($220 for July 2022)
IP
Actual MRP Tons Delivered to Domestic Markets T
B = -(DP) (T)
Description Variable
Cost to Deliver to Domestic Processor B
Domestic Price
($/ton from actual Contractor cost)
($220 for July 2022)
DP
Actual MRP Tons Delivered to Domestic Markets T
MRP Compensation to GW = A + B, or
MRP Compensation to GW = (IP - DP) (T)
The International price shall be determined monthly by the actual sales of Recyclable Materials.
If there are no International sales in a particular month, the International price shall be
determined by the sales from the previous month. The Domestic Price shall be determined
monthly by the actual sales of materials.
Example for July 2022:
International Price = $220; Domestic Price = $220;
Actual MP Tons Delivered to Domestic Markets = 11.615 tons
MRP Compensation to GW = $220 - ($220) * 11.615 tons = $0
Contractor shall report the tonnages delivered and calculate the City’s compensation to
Contractor on a monthly basis and itemize it in the monthly invoice. The actual MRP Tons
Delivered to Domestic Markets in the compensation calculation shall not exceed the Targeted
MRP Tons as determined in Section 3(e) of this Amendment. Unless the actual MRP Tons
delivered to Domestic markets is zero and the City has been notified, then the tonnages may be
carried over to a subsequent month for delivery and compensation calculation.
Contractor shall provide the City:
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(1) Copies of purchase orders and proof of monthly payment received from the
international sale of MRP.
(2) Copies of monthly invoices and payments to the domestic processor for MRP.
d) Annual Limit on Additional Compensation. Contractor’s additional compensation for the
Domestic Materials Management program specified in this Amendment is subject to an annual limit to
be established by the City. City, in its sole discretion, may evaluate and adjust the limit on additional
compensation on an annual basis via the City’s budget development process, as approved by City
Council. If the limit is not adjusted in a given Fiscal Year, then the limit from the previous Fiscal Year shall
apply. The limit for Fiscal Year 2023 is $1,200,000. If this limit is not adjusted, the limit shall remain at
$1,200,000 per fiscal year for the remainder of the Contract term. If this limit, or the established limit in
subsequent Fiscal Years, is reached during any single Fiscal Year, Contractor will have the right to
redirect MP and MRP materials in International markets until City provides notice of and establishes a
new limit.
SECTION 5. Advance Notice to City Regarding Contractor’s Ability to Implement Program. Contractor
shall notify City, at the earliest time practicable, of any occurrence that materially affects the
Contractor’s ability to implement the Domestic Materials Management program specified in this
Amendment, including:
(1) If, by March 31 of each Fiscal Year, the annual limit on additional compensation will not be
reached through the MP and MRP tonnage, Contractor shall notify the City and maximize the
use of Domestic markets for cardboard, or other Sorted Recyclables approved by the City, with
the remaining funds if so directed by the City.
(2) Contractor anticipates reaching the annual limit on additional compensation before the end of
the Fiscal year
(3) Contractor becomes aware that Domestic markets are not available for MP, MRP, cardboard, or
other Sorted Recyclables or if markets are anticipated to not become available on any upcoming
fiscal year.
SECTION 6. Full Force and Effect. Except as provided herein, all other provisions of the Contract shall
remain in full force and effect. In the event of any conflict between the Agreement and this
Amendment, this Amendment shall apply.
SECTION 7. Due Execution. The person(s) executing this Amendment on behalf of a Party hereto
warrant(s) that (i) such Party is duly organized and existing; (ii) such person(s) are duly authorized to
execute and deliver this Amendment on behalf of said Party; (iii) by so executing this Amendment, such
Party is formally bound to the provisions of this Amendment; and (iv) entering into this Amendment
does not violate any provision of any other agreement to which said Party is bound.
SECTION 8. Counterparts. This Amendment may be executed in counterparts, each of which shall be
considered an original.
[SIGNATURES ON FOLLOWING PAGE]
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SIGNATURES OF THE PARTIES
IN WITNESS WHEREOF, the Parties have by their duly authorized representatives
executed this Amendment effective as of the date first above written.
CITY OF PALO ALTO
_____________________________
City Manager
APPROVED AS TO FORM:
__________________________
City Attorney or Designee
GREENWASTE OF PALO ALTO, LLC
Officer 1
By:___________________________
Name:__Tracy M. Adams_________
Title:___Chief Executive Officer____
Officer 2
By:___________________________
Name:___Greg Ryan_____________
Title:____Vice President & COO____
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