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Home My WebLink AboutStaff Report 14835 City of Palo Alto (ID # 14835) City Council Staff Report Meeting Date: 12/19/2022 Report Type: INFORMATION REPORTS City of Palo Alto Page 1 Title: Informational Report on the Fiscal Year 2022 GreenWaste of Palo Alto Certificate of End Use & Traceability Report and Update on Council Direction Regarding Recyclable Materials From: City Manager Lead Department: Public Works Recommendation This is an informational report and no Council action is required. Background 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 GreenWaste of Palo Alto (GWPA), under the existing collection and processing contract, to report on the disposition of recyclable materials and to gather information on the environmental and social implications associated with the processing of Palo Alto’s recyclable materials. GWPA is to request information regarding the disposition of specific materials from each of their primary purchasers to whom the GreenWaste Materials Recovery Facility (GreenWaste MRF) directly sells the recyclable materials and annually report the information to the City. GWPA has previously submitted the Initial Review of Certificate of End Use & Traceability Data for Fiscal Years 20191, 20202, 20213 The information GWPA provided is consistently very limited and restricted due to confidentiality concerns from their vendors. The marketing of recyclable materials is commonly conducted through brokers that orchestrate the processing of materials internationally. Despite its significant efforts and years of trying, GWPA is unable to obtain enough detailed information from the initial brokers on the final destination of materials primarily because the brokers 1 Fiscal Year 2019 Initial Review of Certificate of End Use & Traceability Data, 2019 - https://www.cityofpaloalto.org/files/assets/public/zero-waste/fy-2019-traceability-report_gwpa.pdf 2 Fiscal Year 2020 Initial Review of Certificate of End Use & Traceability Data, 2020 - https://www.cityofpaloalto.org/files/assets/public/zero-waste/fy-2020-traceability-report_gwpa.pdf 3 Fiscal Year 2021 Initial Review of Certificate of End Use & Traceability Data, 2021 - https://www.cityofpaloalto.org/files/assets/public/zero-waste/cmrs/intial-review-of-certificate-of-end-use- traceabilitiy-data-2021.pdf 22 Packet Pg. 283 City of Palo Alto Page 2 consider this market information to be confidential. Therefore, staff does not know with certainty whether the materials sent to international markets are being recycled, or whether they are causing environmental, human health, or social problems once they are shipped overseas. In May 2021, during discussions on this topic as part of the new solid waste processing contract with GreenWaste Recovery (Staff Report ID # 116324), Council directed staff to: 1. Pursue, with other cities, a greater accounting of GreenWaste’s secondary markets; 2. Direct the City Manager to return with an amendment 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 along with the Fiscal Year 2021 Initial Review of Certificate of End Use & Traceability Data, 20215 report on January 24, 2022 (Staff Report #135356). On May 2, 2022 (Staff Report #141697) staff provided an update specifically on securing domestic markets for mixed paper and mixed rigid plastics and regional discussions on the international shipments, and on June 6, 2022 (Staff Report #144648) staff proposed, and Council directed, that staff negotiate a contract amendment with GWPA to provide domestic processing and management of mixed paper and mixed rigid plastic materials. Discussion GWPA 2022 Certificate of End Use & Traceability Data Report GWPA’s Fiscal Year 2022 report titled “Initial Review of Certificate of End Use & Traceability Data, 20229” summarizes the traceability data and online review of information relative to 4 City Council, May 24, 2021; Agenda item #7; CMR #11632 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city-manager-reports- cmrs/2021/id-11632.pdf 5 Fiscal Year 2021 Initial Review of Certificate of End Use & Traceability Data, 2021 - https://www.cityofpaloalto.org/files/assets/public/zero-waste/cmrs/intial-review-of-certificate-of-end-use- traceabilitiy-data-2021.pdf 6 City Council, January 24, 2022; Agenda item #14; CMR #13535 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/agendas-minutes/city-council- agendas-minutes/2022/20220124/20220124pccsm-amended-linked-cq-added.pdf#page=421 7 City Council, May 02, 2022; Agenda item #16; CMR #14169 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city-manager-reports- cmrs/2022/id.-14169-informational-report-on-international-shipments-of-palo-altos-recyclable-materials.pdf 8 City Council, June 06, 2022; Agenda item #9; CMR #14464 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city-manager-reports- cmrs/2022/id.-14464-recyclables-processing-in-the-us-instead-of-internationally.pdf 9 Fiscal Year 2022 Initial Review of Certificate of End Use & Traceability Data, 2022 - https://www.cityofpaloalto.org/files/assets/public/zero-waste/cmrs/2022-traceability-report_gwpa_final.pdf 22 Packet Pg. 284 City of Palo Alto Page 3 sustainability and international markets. This report highlights challenges with commodities markets, GreenWaste’s goal to seek domestic processing, the result of the new mixed paper composting pilot in collaboration with the City, the pilot on tracking plastics sent to a plastic processor in Southern California, and provides updates on the pursuit of other advanced processing technologies for recyclable materials. This report also includes the supplementary marketing, processing, and disposal information from GreenWaste’s primary purchasers and summarizes the recyclable materials tonnages by commodity types, the spread of domestic vs. export markets, and the location of secondary processing. The GWPA report does not explain which shipments go to which facilities in international countries and therefore, it is not possible to definitively determine whether the materials being exported internationally are being recycled properly or whether they may be causing environmental or social problems. In Fiscal Year 2022, approximately 16,000 tons of recyclable materials were processed from Palo Alto with approximately 42 percent staying in the United States and approximately 58 percent being exported internationally to Mexico, Southeast Asia, China, Korea, India, Pakistan, Costa Rica, Brazil, and other countries. These percentages flipped when the three-month pilot began in April 2022, with approximately 62 percent of materials staying in the United States and approximately 38 percent being exported internationally. Update on Council’s Direction Staff developed an action plan to address Council’s direction including to connect and collaborate with other jurisdictions and entities to determine final disposition of their recyclable materials and to determine support and interests to create legislation requiring marketers, brokers, and businesses in the recycling industry to disclose the entire flow of materials to final disposition. Below is an update to each component of Council’s direction: 1. Communication with other cities Palo Alto and San Jose are co-hosting virtual forums on the international shipments of recyclables. They were held on March 16, 2022, June 15, 2022, and November 16, 2022. They were attended by approximately 40 local government staff mostly from cities and counties in Santa Clara County and Alameda County, as well as haulers and processors of recyclable materials. The successful discussion included the sharing of information and ideas on actions that can be taken to increase transparency on the processing of recyclable materials, the options for creating standardized accepted materials for recycling, the potential to improve and expand domestic markets for recyclable materials, and the experiences of processors on marketing and tracking recyclable materials. These forums respond to the direction from Council to coordinate with other cities on this topic. Staff is evaluating whether hosting future forums will be beneficial in regional communication while also fulfilling direction #4, listed above. Staff is also exploring an opportunity to work closer with Alameda County, which is also pursuing tracking recyclables markets. 2. Amendment for a quick response to domestic processing opportunities 22 Packet Pg. 285 City of Palo Alto Page 4 In June 2022, Council directed staff to bring an amendment to the GWPA contract to allow for a quick response to handling mixed paper domestically (Staff Report 1446410). Staff completed negotiations with GWPA to amend the collection and processing contract to include the details of the domestic recycling of mixed paper (MP) and mixed rigid plastics (MRP) program, which allows staff to approve and direct GWPA to market MP and MRP within the U.S. at an annual not to exceed amount. Staff Report 14834, scheduled to be reviewed by the Council on December 12, 2022, recommends that Council approve the amendment and the additional funding needs in FY 2023. 3. Provide GreenWaste reports This information report includes the 2022 Certificate of End Use and Traceability report from GWPA and previous reports. 4. Legislation to spur domestic or in-state recycling Staff is communicating with local legislators to determine the feasibility of developing policies requiring a system to ensure that recyclable materials can be tracked to disclose the entire flow of materials to final disposition; to create a third-party certification process to verify that recyclables intended to be recycled are actually recycled; and to keep recyclables within the United States where laws and regulations can protect the environment and human health. City staff and staff from State Senator Becker’s office plan to continue the discussion of possible legislative solutions in fall 2022. Staff continues to have similar discussions with other entities including the Statewide Commission on Recycling Markets and Curbside Recycling, CalRecycle, and the National Stewardship Action Council in hopes of creating legislation to better track where recyclables end up and how they are managed. 5. Additional secondary market accounting In August 2022, Staff began working with a consultant to research and summarize current recycling market structures and logistics with the intention to improve oversight and transparency into the marketing, handling, and processing of recyclable materials recovered from the City’s collections. This analysis is being conducted and an update on the progress will be provided in a future staff report. Resource Impact This informational report does not have a direct resource impact at this time; however, some of the options staff is exploring may require additional funding within the Refuse Fund Operating Budget for increased future expenses. Stakeholder Engagement The current stakeholder engagement includes conducting virtual forums with other cities and 10 City Council, June 06, 2022; Agenda item #9; CMR #14464 https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-reports/reports/city-manager-reports- cmrs/2022/id.-14464-recyclables-processing-in-the-us-instead-of-internationally.pdf 22 Packet Pg. 286 City of Palo Alto Page 5 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. Environmental Review This item is presented only for Council’s information and therefore it is not a project subject to environmental review by the California Environmental Quality Act (CEQA). 22 Packet Pg. 287