A-1997-025 - Waste Disposal Services

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WASTE DISPOSAL AGREEMENT TI i1S 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"), and 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 The 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 state 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 bankruptcy 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 of out -of -County waste to raise revenues, restructuring the department like a business enterprise 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 imported 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 hntegrated Waste Management Department ("IWMD") began implementing a departmental restructuring plan focused on reducing overhead charges and costs applied by other County department/agencies that provide support services to IWMD, 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. Execution Copy I (Revised Page)