GREAT WESTERN RECLAMATION, INC. A-86-204

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MEMORANDUM To: David Ream, City Manager Date: November 9, 1986 David Grosse, Executive Director UM From: Public Works Agency Subject: CONTRACT RENEWAL FOR REFUSE COLLECTION AND REMOVAL SERVICES STATEMENT OF THE ISSUE Contract Renewal On December 27, 1982, the City entered into an agreement with Great Western Reclamation, Inc. , a wholly-owned subsidiary of Waste Management of North America, Inc. , to collect solid waste refuse in Santa Ana. This agreement is due to expire June 30, 1988. In May 1986, Great Western Reclamation approached the City requesting negotiations for a new agreement. This request was in accordance with the present agreement. Great Western Reclamation, Incorporated's request and the City's consent was motivated by a mutual desire to clear up potential disputes over such matters as disposal costs, gate fees, trash compactor rates and rate adjustments. After five months of detailed discussions, staff submits for consideration by the City Council a new agreement for services to be performed by Great Western Reclamation. The new agreement resolves the disputes and contains the following highlights: 1. The term of the proposed agreement is from January 1, 1987, to June 30, 1993. 2. The reimbursement rates to Great Western Reclamation for disposal and collection have been combined. (Presently, customers in Santa Ana are required to pay a $1.05 monthly surcharge representing disposal costs at the County landfills. ) 3. Using the six-city average specified in the present and proposed agreements, Great Western Reclamation has submitted a single monthly reimbursement rate for collection and disposal per customer. This amount has been verified by Public Works staff and an auditor. 4. The level of service and the method of determining rates for residential and commercial refuse customers remains substantially the same. 5. The agreement makes some adjustment in the operation of the twice-annual large item pickup program for residents. Instead of picking up items at the curb side, large roll-off boxes will be placed in neighborhoods at specified locations. This change reduces visual blight on the streets, yet still provides residents with a less costly alternative than going to the landfills. 6. The proposed agreement would allow Great Western Reclamation to impose additional surcharges on bin service customers utilizing commercial trash compactors. These surcharges must follow specified guidelines established by and approved by the Executive Director of Public Works. % rp 206 a s