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Home My WebLink About7/18/2001 - STAFF REPORTS (15) !1 DATE: July 18, 2001 TO: City Council FROM: Recycling Coordinator VIA Redevelopment Director APPROPRIATION OF $222,000 FROM RECYCLING FUND BALANCE FOR REIMBURSEMENT OF CNG-POWERED FOOD WASTE VEHICLE, RECYCLING CONTAINERS AND PUBLIC EDUCATION MATERIAL TO PALM SPRINGS DISPOSAL SERVICES (PSDS) PER FRANCHISE AMENDMENT#4. RECOMMENDATION: That the City Council appropriate a previously-approved amount of$222,000 to reimburse Palm Springs Disposal Services for purchase of a CNG-powered vehicle, recycling containers and preparation, printing and distribution of educational materials for the food waste program and AB939 waste diversion requirements. SUMMARY: This action appropriates Recycling funds, as provided for in the Fourth Amendment to the Franchise Agreement with Palm Springs Disposal Services (PSDS), to provide a $222,000 reimbursement for actual capital and start-up costs incurred by PSDS for the development and start up of the Food Waste Collection Program. The CNG-powered vehicle itself cost over $244,700, and the remaining recycling containers and public education material and excess costs of the vehicle will be absorbed by PSDS. BACKGROUND: On December 5, 1998, the City of Palm Springs entered into the Fourth Amendment to Franchise Agreement#3082 with Palm Springs Disposal Services (PSDS), to, among other things, create a food waste collection program. The Agreement provided that the actual capital and startup costs (including the cost of a CNG-powered dedicated food waste collection vehicle), in the amount of $222,000, would be funded from the City's Recycling Fund. A Request for Entry of Court Judgment was filed in Riverside County Superior Court on February 26, 1999 by City's legal counsel for court's concurrence that Amendment#4 is valid and binding in relation to Proposition 218, as Amendment#4 proposed to use a portion of the City's Recycling Fund created for the development of the solid waste recycling facility. The Court's ruling validating the action was rendered July 14, 1999 and became binding on August 14, 1999. PSDS could not progress until this process was completed. On February 16, 2000, the City Council approved Resolution #19754 establishing service rates and the budget for the program. The budget was amended as follows: Original Revised CNG-Powered Vehicle $180,000.00 $197,649.87 Containers 17,000.00 17,000.00 Education Materials 25,000,00 7,350.13 Total $222,000.00 $222,000.00 /3�9 Food Waste Collection Repayment July 18, 2001 2 Subsequently, PSDS ordered the food waste collection vehicle (in addition to two other CNG-powered waste collection vehicles), which, in turn, took longer to receive than originally anticipated. In addition to taking more than a year to receive, the cost of the vehicle increased over$40,000 above the revised budget amount. This was due to a different chassis manufacturer being hired....one that had experience in making an Alternate Fuel Vehicle and could also install the fuel tanks, which the original company (Volvo) would have had to sub-contract out to do. The cost for Wittke, rather than Volvo, to do the manufacture of the entire vehicle was higher than original vendor quotes, however, they were able to produce the truck sooner. It is very likely that, had they gone with Volvo, they would still be waiting and would have a prototype that PSDS was not very confident with. The total cost of the vehicle was $244,778, however, PSDS has agreed to pay the container and public education costs, as well as the balance of the truck, and the City will reimburse them the Council-approved $222,000. The wording of Amendment#4 read: "City hereby agrees to pay Contractor with funds from the Recycling Fund for the actual capital and start-up costs incurred by Contractor to develop and implement the Food Waste collection Program ("Food Waste Collection Costs") in the total amount of TWO HUNDRED TWENTY TWO THOUSAND AND 00/100 DOLLARS ($222,000.00), which costs include the following: (1) One Hundred Ninety Seven Thousand and 00/100 Dollars ($197,000.00) for the initial capital costs to acquire source recycling containers of adequate size, shape, design and durability to assure proper operation of the Food Waste Collection Program; plus (2) Twenty Five Thousand and 00/100 Dollars ($25,000.00) for the preparation and distribution of educational information related to the Food Waste Collection Program and AB 929 to all waste disposal customers for the first year of operating such program. City agrees to pay Contractor the actual Food Collection Costs incurred by Contractor within twenty (20) days of the City's receipt of an invoice from Contractor showing the actual Food Collection Costs incurred by Contractor." The actual wording should have indicated: "(1) One Hundred Eighty Thousand and 00/100 Dollars ($180,000.00) for the initial capital costs to acquire Food Waste Collection vehicle and Seventeen Thousand Dollars ($17,000.00) for acquisition of source recycling containers." The staff report and Resolution dated February 16, 2001 should have clarified this in the process of amending the budget. This was the original intent of this section of the Amendment and PSDS and staff have worked on this basis all along. The CNG-powered food waste vehicle is now in service with a pilot program beginning at the Hilton Hotel. The food waste collection truck is picking up six containers a week (two containers, three times a week) and is focusing on the waste stream created by food preparation - vegetables and fruits, only - with expansion as the program develops and more hotels and restaurants come on board. 1342 F Food Waste Collection Repayment July 18, 2001 3 Therefore, PSDS is requesting reimbursement for the vehicle at this time with sufficient funds being available in the fund balance of the City's Recycling Fund. Recycling Coordinator Dire for of R development Appr� -- City Manager 4i Attachments: Budget Resolution Minute Order Invoices REVIEWED BY DEPT.OF FINANCE /3A3 VEHICLE INVOICE 10304 ROO Truck Center of Riverside R00 Truck Center of Fontana D OOD 9700 Galata Strata•Riveside,CA.92509 14267 Valley Blvd.•Fontana,C492335 TRUCK CENTER 9OH816600•Fax909681.0744 909427-8090-Fax 909427.1459 TOLL FREE1800)6335858 TOLL FREE(8001419.7700 SOLD TO: Palm Springs Disposal Services ADDRESS 4690 E Mesquite Ave DATE. SALESPERSONVaS uez Palm SlDrin s, CA 92263 4/30/01 •• •- . O VEHICLE 0 915 TRADE IN INSURANCE COVERAGE INCLUDES 117486.00 •FIRE AND THEFT •PUBLIC LIABILTY AMT. r 1 SELLING PRICE DOC FEE $45.00 •COLLISICN-AML,DEDUCT PROPERTY DAMAGE-AMT. FET PW 13654.22 Calilu is Tire Tax S 10.00 OPTIONAL EQUIPMENT AND ACCESSORIES S8814.82 0E9CRIPTICN FACTORYINSTALLEO $ 3500.00 SALESTAX LICENSE AND TITLE TOTAL CASH PRICE FINANCING INSURANCE TOTAL TIME PRICE $"T LEMENT S 143510.04 DEPOSIT CASH ON DELIVERY $143510.04 TRADE-IN S 1 S LESS LIEN S DEALER INSTAL_], PAYMENTS Ars S 143510.04 Ars TOTAL Customer Focused. Quality Driven. rahV WITTKE Invoice # 33169 1496 Brier Park Crescent NW Date March 1,2001 Medicine Hat,Alberta,Canada T1 C 1T8 Customer P.O. W 1 TT K E Ph.(403) 527-8806 - Fax (403) 529-1821 INVOICE Sold to: Shipped to: Name Palm Springs Disposal Service Name Palm Springs Disposal Service Address P.O. Box 2711 Address 4690 East Mesquite Avenue City Palm Springs City Palm Springs State, ZIP CA M63 State,ZIP CA 92263 F.I.D. : F.I.D.# City Description Unit Price TOTAL i 1 '40 Cubic Yard Residential Full Eject Starlight Sucerticht 57,293.00 57,293.001 Low Profile Front Loader Packer Body Installed onto Customer Supplied 2001 volvc WXLL64 Chassis Bodv SIN WFL40YC01116 Chassis SIN IV2HCSNE61N309815 ONG °ackage 30,000.00 30.000.00 O� i I Subtotal 3 87,293.00 Clffi I , 12% F.E.T. S 10,475.001 Freight 1 S 3,500.o0 • U Y Total, U.S.funds j 3 101,268.00 r ermW Net 30 days charged on overdue acccums at rho rate of 2%per month(24%per annum) RESOLUTION NO. 20106 OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA, AMENDING THE BUDGET FOR THE 20OD-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 new: Reimbursement 125 1280 CNG Vehicle-PSDS $222,000 Purpose:. Reihiburse Palm Springs Disposal Services for purchase of CNG vehicle for use in food waste program. Per Amendment #4 of Franchise Agreement. SECTION 2. SOURCE FUND Activity Account Amount 29301 - Fund Balance 125 $222,000 Adopted this 18th day of July , 2001. AYES: Members Hodges, Jones, Oden, Reller-Spurgin and Mayor Kleindienst NOES: None ABSENT: None ATTEST: CITY OF PALM SPRINGS, CALIFORNIA By City Clerk City Manager REVIEWED AND APPROVED /3� MINUTE ORDER NO. 6891 APPROVING REIMBURSEMENT OF $222,000 FROM THE RECYCLING FUND BALANCE FOR A CNG-POWERED FOOD WASTE VEHICLE TO PALM SPRINGS DISPOSAL SERVICES PER FRANCHISE AMENDMENT#4. ------------------ I HEREBY CERTIFY that this Minute Order, approving reimbursement of $222,000 from the Recycling Fund Balance for a CNG-powered food waste vehicle to Palm Springs Disposal Services per Franchise Amendment #4, was adopted by the City Council of the City of Palm Springs, California, in a meeting thereof held on the 181h day of July, 2001. PATRICIA A. SANDERS City Clerk