Department of Public Works Non-Exclusive Solid Waste Collection Franchise System – Review April 28, 2014

Department of Public Works Overview 3-year review of City’s franchise system Seeks to answer 2 questions 1.What system is best for Pasadena today? 2.What steps Pasadena should take in furtherance of policies to increase conservation & sustainability?  City Council strategic goals  Open Space & Conservation Element  UN Urban Environmental Accords  Green City Action Plan 2

Department of Public Works Chronology August 2007 – City Council approved closure of solid waste collection franchise system  Reduce environmental pollution & number of trucks  Addition of new haulers would cause further air & noise pollution, road damage & congestion  Addition of new haulers not likely to improve service or increase competition  Provide staff time to enforce franchise requirements Directed staff to update City Council every 3 years on status of franchise system 3

Department of Public Works Vehicle Impacts on Pavement 4

Department of Public Works Chronology December 2010 – City Council received 3-year franchise update >Approved retention of closed system >Directed Public Works to report back in 3 years April 8, 2014 – MSC received 3-year franchise update  Recommended City Council retain closed system 5

Department of Public Works Franchise Statistics 6

Department of Public Works Current Franchise System Statistics  22 haulers service 3,465 commercial & multi-family customers  5 haulers serve 3,233 customers (96% of customer base)  17 haulers serve 142 customers (4% of customer base)  Range from 1 to 40 customers 7

Department of Public Works Franchise System Performance Diversion  FY 2012 Citywide diversion rate – 75%  75% minimum diversion rate for C&D  100% of haulers in compliance (77% to 100%)  60% minimum recycling diversion rate for solid waste  100% of haulers in compliance (60% to 100%) Time to enforce franchises  12 (35%) fewer franchises since 2007  Termination provisions for PMC non-compliance  Annual audits 8

Department of Public Works Franchise System Performance Reduce environmental pollution  Phase-in of alternative-fuel vehicles per SCAQMD Rule 1193 to achieve 100% use by July 1, 2018  100% of haulers in compliance  Reduce number of vehicles on City streets  49 (31%) fewer vehicles since 2007  3-year average number of days exceeding federal ozone standard between 2010 & 2012  Decreased by 74.6% 9

Department of Public Works Alternative Service Arrangements Common commercial/multi-family service arrangements  Fully open non-regulated system  Non-exclusive permit system  Non-exclusive franchise system (current model)  Single exclusive franchise  Multiple exclusive franchise Non-exclusive (current system) & exclusive franchise systems provide agencies greatest control over haulers 10

Department of Public Works Exclusive System Benefits CategoryExclusive 11 Description - Service provided by 1 hauler citywide or multiple haulers with geographic zones - Rates approved by city Diversion - Potential for higher waste diversion as haulers would have sufficient customers in proximity for new programs Business - Routing efficiencies may make this most cost effective option - Encourages infrastructure development & vehicle investment Environment - Systematic routes minimize environmental impacts Customer Rates - Rate equity – customers pay same price for same service Other City Benefits - Reduces staff time required to monitor/manage hauler(s) allowing staff to focus on diversion program efforts

Department of Public Works San Jose Model San Jose  June 2012 – moved from non-exclusive (20 haulers) to exclusive system  Reasons for transition  Increase diversion from commercial waste stream due to limited infrastructure investment for recycling by current haulers  Implement efficient citywide service delivery models to improve economies of scale & reduce environmental impact  Performance indicators  Advanced recycling & commercial-scale anaerobic digestion facilities opened  Commercial recycling rate increased from 25% to 70% 12

Department of Public Works Los Angeles Model Los Angeles  Early-2017 – implementing commercial exclusive system  11 geographic zones  Contracts awarded via competitive bid  Reasons for transition  120+ haulers  Trucks traversing city on uncoordinated schedules  Extra wear & tear on roads  Air pollution  Anticipated benefits  Increased diversion  Reduced environmental footprint  Expanded programming  Cost controls 13

Department of Public Works Conclusions/Next Steps Industry best practice – exclusive system Take steps now to position Pasadena to meet anticipated future needs  Move toward Zero Waste 2040  Possible state-imposed increased diversion rates  Desire to further reduce environmental pollution  Need for innovative processing facilities in local area  Recent RFP process for recyclables & organics processing shows need for infrastructure 14

Department of Public Works Possible System Modification CA Public Resources Code contains procedures that must be followed when agency is considering modification to solid waste collection system  Requires agencies to give 5-year notice of intent to implement exclusive solid waste franchise(s) to companies who have been authorized to operate in city for more than 3 years 15

Department of Public Works Recommendations 1.Retain closed Non-Exclusive Solid Waste Franchise System & direct staff to report back in 3 years to City Council with next review of authorized haulers to ensure competitive pricing & options for solid waste recycling & disposal 2.Direct City Manager to place existing franchisees on notice of City’s intent to consider modification of current Franchise System at time 5-year notice expires pursuant to CA Public Resource Code which allows agencies to grant exclusive operating rights to solid waste disposal companies 16

Department of Public Works Zero Waste Plan Summer 2014 – consideration by MSC/Council  Compostable initiatives-development upon adoption  Residential – pilot program for comingled food scraps, compostables & yard waste  Commercial – pilot program with franchise haulers  City events/public venues – compostable collection  Foster/develop compostable processing opportunities  Amend PMC to include exemptions for grass roots efforts  Increase hauler performance requirements 17