Loading...
HomeMy WebLinkAbout8/2/2000 - STAFF REPORTS (33) DATE: AUGUST 2, 2000 TO: CITY COUNCIL FROM: DIRECTOR OF REDEVELOPMENT APPROVAL OF PROJECT DEVELOPMENT FUND BUDGET FOR NEXTPHASE RECYCLING FACILITY, PER AMENDMENT NO. 4 OF FRANCHISE AGREEMENT WITH PALM SPRINGS DISPOSAL SERVICES RECOMMENDATION: It is recommended that the Council approve the Project Development Fund Budget for the NextPhase Recycling Facility as proposed by Palm Springs Disposal Services to allow the company to proceed with preliminary design and engineering and optioning the proposed site for the facility, a state-of-the-art municipal solid waste recycling and organics-recycling facility to handle Palm Springs' solid waste. BACKGROUND: At the May 14, 1997 City Council study session, Palm Springs Disposal Services introduced the idea of a "NextPhase" Recycling Center, which would integrate a solid waste transfer station, a materials recovery facility (MRF), and an in-vessel composting system using the Herhof Bio Cell design to achieve a high degree of diversion at a competitive cost. A Waste Commitment Agreement was adopted by the City Council on May 20, 1998, committing the solid waste generated withing the City of Palm Springs under the City's control —either hauled by the franchise hauler or otherwise contracted — to the facility. On October 7, 1998 Amendment No. 4 to the Franchise Agreement between Palm Springs Disposal Services and the City of Palm Springs was adopted by Council. This amendment allowed for the implementation of a commercial food waste collection program and the creation of a Facility Development Fund within the City's Recycling Fund for the pre-development costs of the facility, including architecture, engineering, environmental review, permitting, and site acquisition. In order to ensure the Facility Development Fund's compliance with Proposition 218, the Franchise Amendment was "validated" through the Riverside County courts. The process of writing the action, filing the action, pleading the action before the court, and waiting for the opinion to be handed down and become final, was completed on August 13, 1999. Palm Springs Disposal Services presented a "status" update on January 26, 2000. Staff has grown increasingly concerned over the past several months about the slow pace of progress on development of the facility. In mid-July, staff informed PSDS over their concern about the lack of progress and needed an answer as to whether the company was still planning on developing the facility. If so, staff gave the company until September 30, 2000 to make "substantial progress" on the facility design, including building elevations, engineered waste flow diagrams, building layout, site plan, and an option on the designated site. If those tasks were not completed, staff proposed recommending to Council that it seek another developer for the facility. PSDS' response was that they were still very committed to developing the facility and would commence those tasks right away to meet the September 30 date. However, one of the provisions of Franchise Amendment No. 4 was that, prior to expending any of the Facility Development Fund, PSDS was to submit a facility development budget for approval by the City Council. Funds for development costs will be appropriated from the City's Recycling Fund reserve and loaned to PSDS. (A promissory note was executed and is a part of Amendment#4.) Funds disbursed will be repaid through proceeds from a tax-exempt bond financing through the California Pollution Control Financing Authority ("CPCFA"). If PSDS withdraws from the project, they are obligated to repay the City any funds advanced. Also, in accordance with Amendment#4, loan proceeds shall be disbursed upon submission of a detailed request to the City Manager. The request shall: 1. Specify the intended use of the funds and the amount thereof; 2. Identify how the expense qualifies as a Facility Development Cost; 3. Identify the budget authorization; and, 4. Show an accounting of all previous funds received. The City Manager could then authorize expenditures up to the budgeted amount. Any change in the budget greater than 5% would need to be authorized by Council. The Development Budget for the project is as follows: NEXTPHASE FACILITY DEVELOPMENT BUDGET ACTIVITY DESCRIPTION BUDGET Site Selection Option payment and out-source services to secure option on site. $ 20,000 Facility Design Out-source services for: 1 Conceptual Design - site plan & elevations, 2 Facility Design & Engineering - material flow analysis, process flow design, architectural design, landscape design, civil engineering, and special studies and design issues, 3 Construction Design Services - construction drawings and specifications, and 180,000 4 Construction Contract Services - bid analysis & negotiation. Public Education Out source services for newsletter and print media advertising. 10,000 CPCFA Fees and out-source services for financing Processing application, credit enhancements. 30,000 Environmental City's consultant for environmental Review assessment and out-source liaison 75,000 services. Permitting Fees and out-source services for processing of local land use and county, regional and state permits. 85,000 Total 400 000 Staff recommends approval of the Facility Development Budget for the NextPhase Project. PSDS has committed to returning to Council at the September 27 Study Session with a conceptual design of the facility. It appears that, after several years of delays, the project may be on track toward development. Funds for the Facility Development Fund are available within the Fund Balance of the City's ecycling Fund. J H RAYM R dev opment Vector APPROVED: ,City`Manager ATTACHMENTS: 1. Resolution 2. Facility Development Budget 3. Letter from Robert W. Kuznik, Palm Springs Disposal Services REVIEWED By KK OF FINANCE � Ih3 EXHIBIT"T' TO RESOLUTION APPROVING NEXTPHASE RECYCLING FACILITY'S FACILITY DEVELOPMENT BUDGET NEXTPHASE FACILITY DEVELOPMENT BUDGET ACTIVITY DESCRIPTION BUDGET Site Selection Option payment and out-source services to secure option on site. $ 20,000 Facility Design Out-source services for: 1 Conceptual Design - site plan & elevations, 2 Facility Design & Engineering - material flow analysis, process flow design, architectural design, landscape design, civil engineering, and special studies and design issues, 3 Construction Design Services - construction drawings and specifications, and 180,000 4 Construction Contract Services - bid analysis & negotiation. Public Education Out source services for newsletter and rint media advertising. 10,000 CPCFA Fees and out-source services for financing Processing application, credit enhancements. 30,000 Environmental City's consultant for environmental Review assessment and out-source liaison 75,000 services. Permitting Fees and out-source services for processing of local land use and county, regional and state permits. 85 000 Total 400 000 Palm Springs Disposal Services 4690 East Mesquite Avenue P.O. Box 2711 Palm Springs, CA 92263-2711 Telephone: (760) 327-1351 Fax: (760) 323-5561 July 20, 2000 Mr. John Raymond Via Facsimile, Original Hand Delivered Redevelopment Director City of Palm Springs 3200 East Tahquitz Canyon Drive Palm Springs, CA 92263 Dear John: Re: APPROVAL OF DEVELOPMENT BUDGET Your letter dated July 6, 2000, outlined the City's interest in, and concerns about the development of the NextPhase facility and established a deadline of September 30 to secure a site and submit a "conceptual design". As I reported to you by telephone, we are committed to the Project and will proceed immediately to comply with the prescribed schedule. As we discussed, securing an option to purchase the site and submission of a conceptual site plan and conceptual architectural elevation drawing will demonstrate the prescribed progress. We will be prepared to present the conceptual design to the City Council at their September 27, Study Session. As cited in your letter, Franchise Amendment#4 provided the financial coverage for development costs. In accordance with the Amendment, we are now submitting the development budget for the project for approval of the City Council. As we discussed, in order to meet the deadline imposed by the City, the budget will need to be approved no later than the August 2 meeting of the City Council, and if that is not possible the September 30 date will need to be adjusted accordingly. Project Description The Project referred to as the NextPhase Facility is a waste processing facility that will serve the solid waste diversion and disposal needs of Palm Springs. The Facility will be located in the city limits of Palm Springs, north of Interstate 10 in the vicinity of the Mr. John Raymond July 20, 2000 Re: APPROVAL OF NEXTPHASE DEVELOPMENT BUDGET Page 2 North Palm Springs Business Park. The Project will consist of a transfer station(for the consolidation and transportation of Municipal Solid Waste delivered by commercial haulers and self-haul generators), in-vessel composting (to convert Organic Waste into a beneficial soil amendment as a diversion strategy), and recyclables processing (to classify and consolidate materials collected in recycling programs). The Project will include a Learning Resource Center linked to the environmental studies curriculum of local schools and also serving the community at large, and a liquefied natural gas (LNG) refiieling station with public access. The transfer station will be built in the first phase, and the composting capabilities will be added in the second phase. Project Time The critical date for completion of the facility is the closure of the Edom Hill Landfill. We have recently confirmed that the Riverside County Waste Management Department projects the closure to occur between late 2003 and mid 2004. The Project timeline is as follows: NEXTPHASE FACILITY TIMELINE ACTIVITY PERIOD Design&Permitting: Conceptual Design July- September 2000 Preliminary Design October 2000 -January 2001 Environmental Review January- June 2001 Land Use Permitting July—September 2001 County, Regional& State Permitting September- October 2001 Construction Drawings/Specifications November- December 2001 Construction Bid/Negotiation December 2001 Financing & Construction: CPCFA January -March 2002 Construction April-November 2002 Facility Shakedown November 2002 Facility Start-Up December 2002 Development Budget The Development Budget for the project is as follows: V2q , � Mr. John Raymond July 20, 2000 Re: APPROVAL OF NEXTPHASE DEVELOPMENT BUDGET Page 3 NEXTPHASE FACILITY DEVELOPMENT BUDGET ACTIVITY DESCRIPTION BUDGET Site Selection Option payment and out-source services to secure option on site. $ 20,000 Facility Design Out-source services for: • Conceptual Design- site plan& elevations, • Facility Design&Engineering - material flow analysis, process flow design, architectural design, landscape design, civil engineering, and special studies and design issues, • Construction Design Services - construction drawings and specifications, and • Construction Contract Services -bid analysis & negotiation. 180,000 Public Education Out source services for newsletter and print media advertising. 10,000 CPCFA Processing Fees and out-source services for financing application, credit enhancements. 30,000 Environmental Review City's consultant for environmental assessment and out-source liaison services. 75,000 Permitting Fees and out-source services for processing of local land use and county, regional and state permits. 85,000 Total $400,000 Project Payment Procedure Pursuant to Franchise Amendment#4, funds for development costs will be appropriated from the City's Recycling Fund reserve and loaned to PSDS ("Contractor"). (A promissory note was executed and is a part of Amendment #4.) Funds disbursed will be repaid through proceeds from a tax-exempt bond financing through the California Pollution Control Financing Authority("CPCFA"). If the Contractor withdraws from the project, the Contractor is obligated to repay the City any funds advanced. Also, in accordance with Amendment#4, loan proceeds shall be disbursed upon submission of a detailed request to the City Manager. The request shall: • Specify the intended use of the funds and the amount thereof; • Identify how the expense qualifies as a Facility Development Cost; • Identify the budget authorization; and, �qA � Mr. John Raymond July 20, 2000 Re: APPROVAL OF NEXTPHASE DEVELOPMENT BUDGET Page 4 • Show an accounting of all previous funds received. Per your request,I plan to make a brief presentation of this material to the City Council at the July 26 Study Session. In the meantime, please contact me should you have questions or require anything further. Si erely, i Roberta W. Kuznik �a�9S RESOLUTION NO. OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, APPROVING THE FACILITY DEVELOPMENT BUDGET FOR PALM SPRINGS DISPOSAL SERVICES' DESIGN AND CONSTRUCTION OF A SOLID WASTE RECYCLING AND COMPOSTING FACILITY TO SERVE THE CITY OF PALM SPRINGS - - - -- -- - - - - - - - WHEREAS, the Edom Hill Landfill which currently serves Palm Springs and the other Coachella Valley communities will reach capacity and be closed no later than May, 2004, forcing the City to look at transferring its waste for disposal outside the Valley; and WHEREAS, the State of California has mandated that 50% of waste generated in the community be diverted from landfill by the year 2000 and the City is committed to meeting or exceeding the State diversion goal through the implementation of recycling programs and the adoption of innovative waste diversion technologies; and WHEREAS, Palm Springs Disposal Services (PSDS) has proposed to construct and operate the NextPhase Recycling Facility which will enable the City of Palm Springs to meet its environmental goal of maximizing waste diversion and provide for transfer of waste to a landfill outside the Coachella Valley upon closure of the Edom Hill Landfill; and WHEREAS, it is proposed that the Facility be financed in part through tax-exempt bonds issued through the California Pollution Control Financing Authority; and WHEREAS, the City agreed to create a Facility Development Fund within its Recycling Fund through Franchise Amendment No. 4 with PSDS for the predevelopment costs of the facility, including design and engineering, environmental approvals and permitting, and site acquisition; and WHEREAS, Franchise Amendment No. 4 further specifies that prior to expending funds from the Facility Development Fund, PSDS shall first obtain approval of the Facility Development Fund budget from the City Council. NOW THEREFORE, the City Council of the City of Palm Springs, California, does hereby resolve as follows: SECTION 1. The Facility Development Fund Budget for the NextPhase Recycling Facility, as presented to the City of Palm Springs, is hereby approved. SECTION 2. Palm Springs Disposal Services may commence the development of the project, including incurring costs as outlined in the budget, and seek reimbursement from the City of Palm Springs according to the provisions of Franchise Amendment No. 4. SECTION 3. The City Manager is authorized to approve reimbursement to PSDS within the parameters of Franchise Amendment No. 4 aqh SECTION 4. The City Attorney is further instructed to negotiate additional agreements with PSDS that facilitate the development of the NextPhase Recycling Facility. ADOPTED this day of 2000. AYES: NOES: ABSENT: ATTEST: CITY OF PALM SPRINGS, CALIFORNIA By City Clerk �J City Manager REVIEWED AND APPROVED: g� �a �8z RESOLUTION NO. OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING THE BUDGET FOR THE 2000-01 FISCAL YEAR. ------------- WHEREAS Resolution 19817 approving the budget for the fiscal year 2000-01 was adopted on June 21, 2000; and WHEREAS the City Manager has recommended, and the City Council desires to approve, certain amendments to said budget; NOW THEREFORE BE IT RESOLVED that the Director of Finance is authorized to record inter-fund cash transfers as required in accordance with this Resolution, and that Resolution 19817, adopting the budget for the 2000-01 fiscal year is hereby amended as follows: SECTION 1. ADDITIONS Fund Activity Account Amount No: 125 1280 xxxxx $400,000.00 Title: Recycling NextPhase Facility Development Purpose: Pursuant to Franchise Amendment#4, creation of a development fund for the NextPhase Recycling Fund from City's Recycling Fund SECTION 2. SOURCE Fund Activity Account Amount No: 125 Fund Balance $400,000.00 Title: Recycling Adopted this day of 12000. AYES: NOES: ABSENT: ATTEST: CITY OF PALM SPRINGS, CALIFORNIA By City Clerk City Manager REVIEWED AND APPROVED: a� �