PREPARED BY: AMANDA BOOTH DATE OF MEETING: 01/21/2025
SUBJECT:
TITLE
PUBLIC HEARING AND CONSIDERATION OF RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN PABLO PERTAINING TO REQUEST FROM RICHMOND SANITARY SERVICES TO INCREASE THE MAXIMUM SOLID WASTE COLLECTION SERVICES RATES EFFECTIVE JULY 1, 2025
CEQA: Under the California Environmental Quality Act (CEQA), establishing maximum solid waste collection rate adjustments is statutorily exempt under Public Resources Code Section 21080(b)(8) and 14 Cal. Code of Regulations Section 15273 on the basis that the proposed changes to rates and charges are needed to meet operating expenses, and is also categorically exempt under Section 15061(b)(3) of the CEQA guidelines, on the basis that there is no significant environmental impact as a result of the rate changes. A Notice of Exemption will be filed with the County Clerk if the resolution is adopted.
Label
CITY MANAGER RECOMMENDATION
Recommendation
Conduct public hearing; adopt Resolution
Body
Compliance statements
FY 2023-2025 Council Priority Workplan Compliance Statements:
Develop and implement Long-Term Environmental Stewardship is a major policy goal contained in the FY 2023-25 City Council Priority Workplan, adopted May 1, 2023.
BACKGROUND
Solid waste rates for businesses and residential properties in the City of San Pablo (“City”) are among the lowest in the area for garbage services that meet California regulatory requirements. The City contracts with Richmond Sanitary Service Inc., a subsidiary of Republic Services (“RSS”), for solid waste collection services. The current Franchise-Collection Agreement between the City and RSS as amended in 1994, 1999, 2000, 2002, 2007, 2012 and 2013 is set to expire on June 30, 2025. Post-collection services <https://recyclemore.com/about/governing-documents/>, which include the transfer, transport, and disposal of solid waste, processing of recycling and green waste, and operation of the Household Hazardous Waste Facility <https://recyclemore.com/hazardous-waste/hhw-facility-info/>, is managed by the West Contra Costa Integrated Waste Management Authority (“RecycleMore”) and is not part of the Franchise-Collection Agreement between the City and RSS.
On May 15, 2023, City Council adopted Resolution 2023-079 directing City staff to coordinate with other interested West Contra County jurisdictions to conduct a joint open and competitive bid process for a new Franchise-Collection Agreement. On January 5, 2024, the City released a joint Request for Proposals with the City of Richmond for a new Franchise-Collection Agreement. The City received one (1) proposal from RSS, and on May 20, 2024, City Council adopted Resolution 2024-063 directing City staff to commence negotiations with RSS and authorizing the City Manager to prepare a Franchise Fee Study to evaluate the overall fiscal impact of solid waste collection services on the City and confirm if the current solid waste collection rates in the City should be adjusted. City staff contracted with R3 Consulting Group, Inc. (“R3”) to conduct the Franchise Fee Study and assist City staff with negotiating the terms and conditions of the new Franchise-Collection Agreement with RSS.
The results of the Franchise Fee Study supported adjusting the portion of the current solid waste collection service rates attributed to the fiscal impact to the City (“Franchise Fee”) incrementally from 10% to 15%. Furthermore, the Franchise Fee Study determined the City’s current and projected Franchise Fee revenues do not exceed the City’s actual reasonable costs pertaining to the management, administration, regulatory compliance, and enforcement obligations associated with its solid waste collection activities.
Between June 2024 and October 2024, City staff negotiated the terms and conditions of a Franchise-Collection Agreement between the City and RSS to provide essential solid waste collection services for residents and businesses, establish performance standards for RSS, and provide residents and businesses with comprehensive disposal and recycling options for solid waste materials. Adjusted solid waste collection service rates negotiated in the new Franchise-Collection Agreement will fund programs and services to comply with the California Integrated Waste Management Act of 1989, inclusive of Assembly Bill (AB) 939, AB 341, AB 1826, AB 1594, Senate Bill (SB) 1383, and SB 54.
On October 21, 2024, City staff presented the proposed Franchise-Collection Agreement, the completed Franchise Fee Study, and an overview of the procedures required to implement the adjusted rates for the solid waste collection service fees to the Public Safety Standing Committee (PSSC). PSSC directed City staff to finalize all terms and conditions for the new Franchise-Collection Agreement for formal Council consideration and approval, and further recommended City Council authorize City staff to proceed with the required “Proposition 218” procedures pursuant to Article XIID Section 6 of the California Constitution to implement the adjusted rates for the solid waste collection service fees.
On November 18, 2024, City Council adopted Resolution 2024-387 authorizing the City Manager to execute a new Franchise-Collection Agreement with RSS, accepting the final Franchise Fee Study, and authorizing staff to proceed with the required procedures to adjust the rates for solid waste collection services including holding a public hearing on January 21, 2025. During the public hearing this evening, City Council shall consider all oral testimony, written materials, and written protests regarding the proposed adjustments to the solid waste collection services rates. If written protests from a majority of affected property owners and solid waste collection service ratepayers in the City is not received by the close of the public hearing, City Council may adopt the attached resolution approving the adjusted solid waste collection service rates effective July 1, 2025.
The adjusted solid waste collection service rates will remain among the lowest in West Contra Costa County. The adjusted solid waste collection service rates effective July 1, 2025 can be found in Exhibit 1 of the new Franchise-Collection Agreement with RSS, which is provided as Attachment B to this report. However, the actual rates that will be charged to ratepayers from July 1, 2025 through December 31, 2026 is anticipated to be less than those shown in Exhibit 1 of Attachment B and in Table 1 because the City Council has opted to apply rate-stabilization funds to offset customer rate increases. Solid waste collection service rates in the City will increase July 1, 2025 in accordance with Table 1 below and will include adjustments every calendar year through December 31, 2029.
Table 1: Maximum Monthly Solid Waste Collection Rates 2025-2030
|
Container Size |
Proposed Rates (effective 7/1/25) |
2027 |
2028 |
2029 |
2030 |
|
20-gal |
$30.18 |
$32.50 |
$35.00 |
$36.75 |
$38.59 |
|
32-gal |
$32.49 |
$34.99 |
$37.68 |
$39.56 |
$41.54 |
|
64-gal |
$62.15 |
$66.93 |
$72.08 |
$75.68 |
$79.47 |
|
96-gal |
$92.11 |
$99.20 |
$106.83 |
$112.17 |
$117.78 |
|
1-Cubic Yard Commercial |
$294.06 |
$316.68 |
$341.04 |
$358.09 |
$376.00 |
|
10-Yard Industrial |
$530.00 |
$570.77 |
$614.67 |
$645.41 |
$677.68 |
PUBLIC NOTICE
The City mailed notices to all property owners in the City a minimum of 45 days prior to the public hearing this evening pursuant to Article XIID Section 6 of the California Constitution. The mailed notice is provided as Exhibit A to the Resolution.
FISCAL IMPACT
The adjusted solid waste collection rates will increase cost-recovery funds paid to the City by approximately:
$ 75,000 in Fiscal Year 2025-26
$260,000 in Fiscal Year 2026-27
$270,000 in Fiscal Year 2027-28.
Current annual revenues are estimated at $575,000, which is less than half of the City’s costs associated with the management and administration of the Franchise-Collection Agreement. R3 estimates the City’s adjusted solid waste collection revenues will be approximately:
$ 650,000 in Fiscal Year 2025-26
$ 910,000 in Fiscal Year 2026-27
$1,180,000 in Fiscal Year 2027-28
ATTACHMENTS:
Att A - Resolution
Exhibit A to Attachment A - Prop 218 Brochure
Att B - RSS Franchise-Collection Agreement