Item 22 Second Amendment to the Waste Disposal Agreement with the County of Orange

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Second Amendment to the Waste Disposal Agreement May 20, 2025 Page 2 waste and an allocation of capital expenditures for organics recycling infrastructure at County landfills. The Orange County City Manager Association (OCCMA) formed a committee in December 2024 to negotiate a successor agreement to the WDA and requested an extension of the current WDA to allow time for such negotiations. OCW&R has agreed to the OCCMA committee's requested extension under the terms of the proposed amendment. However, provisions shall not become effective unless and until the amendment has been executed by all of Orange County cities/sanitary districts. The amendment will provide for a 12-month extension of the current WDA and a 2.6% disposal fee increase to $43.76 per ton, per the escalation formula in the current WDA (Exhibit 1). This disposal fee increase is expected to result in a modest rise in the City's overall waste management costs. However, the increase remains in line with the terms of the existing agreement and reflects standard annual cost escalation. The impact on the community is minimal, as residential and commercial rates are not anticipated to change as a direct result of this adjustment. The extension period will allow stakeholders to conduct due diligence on a successor agreement to the WDA as well as evaluate costs, infrastructure plans, and future fee adjustments. If the OCCMA committee and OCW&R do not reach mutually agreeable terms by September 30, 2025, monthly updates will be provided to all cities/sanitary districts beginning October 2025. Staff recommends the approval of a Second Amendment to the WDA to allow continued importation of waste to the County's three landfills and continued negotiations among all cities/sanitary districts in Orange County for an additional year (Exhibit 2). This will ensure stable disposal rates for residents and businesses and preserve existing service levels. ENVIRONMENTAL IMPACT There is no environmental impact associated with this action. FISCAL IMPACT The estimated importation revenue resulting from this second amendment will be deposited into the following account for the specified year: Fiscal Accounting Fund Accounting Unit, Amount Year Unit- Description Account Description Account # FY 25-26 06917002- Refuse Revenue Collection 57702 Collection Revenue, County Waste $490,000 Service Importation TOTAL $490,000