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Amended and Restated Agreement with USA Waste of California, Inc. (dba Waste Management of Orange County) April 18, 2017 Page 2 Action 1 • The Proposed Amended and Restated Agreement is a consolidation of all of the previous amendments and agreements and identifies a single franchise fee to replace a number of miscellaneous charges and transfers to the City (i.e., Program Surcharge, Administrative, NPDES, and other fees added to the cost of services). • All of the fees from residential, commercial, and industrial services will be consolidated and set forth as a single Franchise Fee of 26.15 percent (Exhibit 2). • The Proposed Agreement does not present any customer rate or service changes. The Proposed Agreement allows for pass- through of Sustainable Mobility and Roadway Transformation (SMaRT) Program fees should Council approve the program. • Waste Management of Orange County has agreed to the terms of the Amended and Restated Agreement. Action 2 A Request for Proposal (RFP) process requires at least 15 -18 months for a city the size of Santa Ana to complete. Considering the expiration date of June 30, 2018, there is not adequate time to conduct a thorough RFP process, culminating in a new agreement. Furthermore, the Sloan Vazquez report recommends that it would be in the best interest of the City to extend the agreement for two years (July 1, 2018 — June 30, 2020). The primary reasons for the recommendation to extend the agreement are as follows: • The City must immediately address existing program gaps mandated by legislation, which will require modification to the current agreement. • Finalization of County of Orange renewable energy infrastructure plan during this time could provide local, lower -cost options not currently available. • Rollout of Los Angeles commercial franchise system requires transition of approximately 70,000 commercial accounts over next 9 -12+ months and will place strain on equipment (truck, bin, etc.) manufacturing and delivery capabilities, will most likely raise those prices which would not be to the City's benefit, and impact human and capital assets available to most major haulers during that timeframe. • Current rates are competitive compared to ten other similar Orange County municipalities (not considering the current franchise fee) and services meet or exceed most offerings in those municipalities. The City would continue to benefit from the current contract benefits during the short-term contract extension • This will allow staff to conduct a competitive procurement process for a new, long -term agreement to commence July 1, 2020. STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal #4 — City Financial Stability, Objective #1 (maintain a stable, efficient and transparent financial environment). ENVIRONMENTAL IMPACT There is no environmental impact associated with this action. 65A -2