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Home My WebLink About0320.095.f o 5 City of Palo Alto City Manager's Report TO: HONORABLE CITY COL'NCIL FROM: CITY MA."tAGER DEPARTMENT: PUBLIC WORKS AGENDA DATE: lueZ6, 1995 CMR:320:9S SUBJECT: . BEQUEST Approvol of Amendmo.t No.8 10 eo.traot No. 4688 willi Palo Alto Sanitario" Comp •• y ror Rer ... CoDectioD IUd Recycling Services This report recommends thaI Council approve and authorize the Mayor 10 execute Amendment No. 8 10 the compensation section 0( the existing contF.ct with Palo Aho Sanitation CoInpwly (PASCO) for refuse collection and recycling services. This amendment will selthe compensation 10 be received by PASCO for fisc<lI year 1995-96. BFCClMMl.NDADON SIaff recommends IbaI Council approve and auIhorile the Mayor 10 eJ<eCUte Ameildment No. S 10 Coo!ract No. 4688, 10 provide for revised compensation 10 the Palo Aho Sanitation Qxnpany (PASCO) IIllder Ihe contract for refuse collection and recycling services effective InJy I. 1m. POucy IMPI.JCADQNS This approval is consL.tent with existing policies. BACKGRQJINQ The present contract with PASCO provides for refuse collection ser.-kes, residential and commercial recycling, public receptacle emptying and operation 0( the Recycling Center. The contract pmvides for PASCO 10 receive as compensation a percentage of the Refuse Fund coilection revenue for its services. This amendment, Number 8, is 10 the master contract which was approved by Council in 1987. The master contract between the City and PASCO establishes the basis by which PASCO's compensation will be determine<!. The annual amendments provide for the review 0( the upcomiDg year's PASCO budget and cak;ulation of specific compensation, based upon those master contract provisions and PASCO's approved budget requirements. This year', review was conducted consis!enl wiIJl not only those contrac!Ual provisions and historicaJ precedents, bul also with consideration of recommendations in the PASCO audit conducted by the City Auditor', office. StaJf from both the Public Works and Fmance .. , o Dep.\I1lmnts have reviewed PASCO's proposed budget in the manner proposed by those recoolIIlendations and have set next year'. compensation based on such review_ 'Ibis cootracI amendmenI: represents an extension 0{ the PASCO contract on !is preseIll \erms and cooditioos_ The cOOlract will thus be continue<! through FY 1995-96 on t! .. same basis as it bas existed during FY 1994-95_ Issues raised in the audit will be evaluated during the Cost of Service Consultant Study_ Recommendations for COOIract.w changes will be incorporated into next year'. cootract negOOations. AMENDMENT TO COh'TRACT The COOIract between \be City and PASCO bas • provision whicb allows for an annual review and renegotiation of the percentage 0{ revenue paymellt. Starr, practice has been 10 meet with PASCO and provide for the revision 0{ percenlage 0{ ro"oue payment through a contract amendmeIll approved by \be City Cooocil. This proce<s allows for • detailed evaluation 0{ PASCO', budget and operating cost effects 00 the subsequeIll City refuse fund bud.get forecast. City staff bas carefully ~'Zed P ASCQ'. cost data 10 ensure that requested Iimds for FY 1995-96 are reasonable, and that PASCO asset repIacemen! plans are prudent. Fwoce olliff worked closely with Pu1>lic Works staff in reviewing \be PASCO budget submillal. BIldget and Public Works staff spell! in excess 0{ 100 hours reviewing the budget, the result of whiCh was a reduction 0( $120,000 from the initial City budget for collection COSIS. Reductions were achieved in various line items in the PASCO submittal. For the purpose 0( rate setting for next fiscal year and PASCO profits, the pre""" rate 0( returD on undepreci.ated fixed assets bas been IlIIgeted at S percent. Any pre-tax profll exceeding 8 percent will be divided equally with the City. The City's share 0( any pre-tax pro6l will be credited against the succeedins year'. revenue requirement for PASCO. If PASCO were 10 receive more profit than \be agreed rate 0( retunl in any particular tiscaI year, the :IisaIlowed excess would be applied as an offset \() the following year'. revenue requirement; and the percenlage 0( refuse service billing paid 10 PASCO would be reduced. FISCAl, lMl'ACTS The fiscal impacts related 10 this report have been included in the FY 199$-96 Refuse Fund Operating Budget. ENVIRONMENTAl. ASSf..SSMfNT The amendment '" Contract No. 4688 for compensation PU!I""" is OOC l project under the California Enviroomental Quality Act, therefore, 00 environmenta.l assessment is required . . ' --" • -. • , r . J AnACHMENT ~No.8 PREPARED BY, Michael H. Miller, Deputy DireclOr, Public Works Operarioos CI1Y MANAGER APPR.OVAL:_~~"'~Ii!"~'~~~t~ MA~ l.u~r-____ _ r: 4LEMlNG-,?, tty Manager . '.~. -.. "' AKBIiDlliBil'1' 110. e TO COlITRACT 110. usa 1& .WiJ!lI nm CITY OF PALO ALTO AlII> PALO ALTO SAJrlTATIOII COMPANY POll COLI.EI:'l'lOli AJIl) nABSPOI1.TATIOII OF llD'tISB l'aODOCBD AlII> ACC!DfI!LA'l'BII n; 'l'li!B CITY FISCAL TBA1 1"5,1"6 This Amendment No. B to Contract No. 4688 is entered into • 1995. by and bet-..oeen the CITY OF PALO ALTO, a ::c"h"a"r"t"e"r"ed=---:c"i"'"t"y and a _ municipal .corporation of the State of california ,·CITY"I. a.o<I PALO ALTO SA.'UTATION CCMPANY. a corporatlon duly orga:tlEed and existing under the laws of the State of california '"CONTR..r.cTOR"'. a I C I % A L &2 WHEREAS, Contract No. 46B8 was previously entered into between CITY a.!ld CONTRA...."TOR.. under 'Which CONTRACTOR provides certain specifisd servic~s for the collection and transportation of refuse produ~ed ~r accumulated in CITY; and WHER~$. the parties desire to modify said contract as set forth below, NOW.. THEREFORE. in consideration of their ~utual ~nants, the parties hereto agree that Cbntract No. 46SS shall be amended as follows: $3CfIQN 1. Section 9 is amended to read as follows: "9" COMPENSATION. As full and complete compensation for the services to be provided by CONTRACTOR hereunder. CITY shall pay CONTRACTOR as follows: Effect.ive the first billing eyc} e of July. 19.95. ~th respec~ to the reven~e derived each calendar month fr~ CITY refuse service rates described in Section e above .. CITY shall compute and pay to CONTRACTOR. on or before the tenth of the following month, an amount equal to Thirty one and Thirty hundredths percent (31.30') of reVEnue billed under refuse rate schedules.,. less any liquidated damages assessed under Section 5tc}~3} of the refuse collection specifications. With respect to the revenue derived each calendar mooth from the CITY collection bin rental described in Section e above. CITY shall compute and pay CONTRACTOR on or before the tenth of the following moDth an amount equal to ninety-five percent (Sst} of revenue billed under refuse rate schedules for such .collection bins. CONTRAC'TOR shall credit CITY with six percent (6t} of gross revenues of CONTRACTOR. derIved from activities associated with or 1 . -: arising fr~ this c~tract, but which are n~ perto~d within t.he scope of this contract (such as but not limited to portions ot the cleaning operation). CITY is author1zed to deduct such credit from the payments due CONTRACTOR. in t.he cext succeeding year. Ac(:cunts and records from the ac~ivities shall be made available to crTi ~oacurrently with the Annual Financial Statements supplied pursuant to Section 7 above. From the above payment amounts, CITY may deduct liquidated dan'.ages assessed CONTRACTOR under Section 34 of this c~tract. Annually" on or before Decerrber 31.. CIn or CONTR.."'--~R 00 -writt.en notice to the other may request a review and renegociation of t.he percentage of revenue payment. Any renegotiated payment amounts" any percentage of revenue payment adjustments or any ~her renegotiated items s1".all be included in a lett.er of understanding 'Which shall include the formula of calculatiOlls used to detem..ine percentage of payments~ and will not become effective until July 1 the following year." SSMION 2. Except as herein modified~ all other provisions of6 including the exhibits and amendments to, Contract ~. 4668 shall remain in full force and effect. SECTION 3. The Council of the City o,f Palo Alto finds that: this amendment t.o Contract No. 4.0588 does DOt constitut.e a project under the California Environmental Quality Act and, ~herefore~ no en~ironmental assessment is necessary. IN WITNESS WHER.EOP~ the parties hereto have executed this Amendment the date first. above vritten~ ATTEST: CITY OF PALO ALTO City Clerk Mayor APPROVED AS TO FORM: Senior Asst. City Attorney APPROVED: Assistant City ManageZ' Director of Public Works 2 • DIrector of ~~la. services Ilisk .Manager MIo' , r_ ...... Azoo<:/ PA .... lIIAO ilia Jooo, CA HUJ , .. -. '==----------,------/ =". Ftdnltnoura...:o~ ~~----------~~--------~ =",C KGX BAl'J00l75.l ----...,., I'IIDIIH fllOlM I7IOI1H ac:uJ) "'" CF lHf AICM! DI!~ ~ IE ~,!O I!E1=OFI£ tH£ ~ncN I».TE ~ .. " ....a 0/JIII'IItf MJ. eu.t.~ 10 IrMI. .L. DAV'S 'MId1OI t«:m:E. 'JO 1H[ OEJI1'FCI,TE HOlDEJI tw.e 'JO "tHE W'l. ... " FAI,ur:E 10 ...... ~ N:::RlOE .w.J. IIP)SE NO C8I.JIM,"'OON QIiI .-... CO N<T~;;ij~~~~~Z~~;:~~~~~~~~ 't\ @ PCUCY HUUBER: tea, I I. ADDmoNAllNSURED • OWNERS. 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