COUNCIL DISTRICT: City-Wide
RECOMMENDATION
Approval of ordinances granting Commercial Solid Waste and Recyclables Collection Franchises and approval of Commercial Solid Waste and Recyclables Collection Franchise Agreements with:
· AAA Express Roll-Off
· Butterick Enterprises, Inc. dba B&B Roll-Off Service
· Browning Ferris Industries
· Custom Disposal Service
· Diversified Recycling Services, Inc. dba San Jose Recycling II
· E.M.S., L.L.C.
· Green Valley Disposal Company, Inc.
· Green Waste Recovery, Inc.
· Green Waste Recovery, Inc. dba $99 Debris Box
· Grifall Trucking. Inc.
· Green Team of San Jose dba GT Waste Services
· JHM Services, Inc.
· Jonna Corporation dba Premier Recycle
· Julie Coleman Enterprises, Inc. dba Pacific Rim Recycling
· Phillip A. Ingram dba Coast Dumpster Service
· Los Altos Garbage Company dba Stevens Creek Disposal & Recycling
· Mission Trails Waste Systems dba Recycle West
· Number “1” Disposal
· Panther Industries
· Newark Group, Inc. dba Recycled Fibers
· Recycling Systems
· Smurfit-Stone Container Corporation dba Smurfit-Stone Recycling
· The Flea Market, Inc.
· USA Waste of California dba Hollister Disposal
· Waste Management of California, Inc. dba Waste Management of Santa Clara County
The City of San Jose has traditionally had an open market for the collection of recyclables and rubbish (solid waste that does not contain food waste) from businesses, institutions, and other non-residential properties. Since 1995, the City has also allowed open competition for the collection of commercial garbage (solid waste that contains food waste). While open systems for commercial solid waste collection are rare in the Bay Area, they are typical for large North American cities. Examples of other cities that allow open competition for commercial solid waste collection include Los Angeles, San Diego, Sacramento, Portland, Seattle, Vancouver, Chicago, and New York.
Private haulers compete with each other on a customer-by-customer basis to provide solid waste and recyclables collection services to San Jose businesses. Collectors of source separated recyclables are required to obtain a San Jose Business Tax Certificate. Haulers that collect commingled recyclables and/or garbage are required to obtain a San Jose Business Tax Certificate and a Commercial Solid Waste and Recyclables Collection Franchise. There are currently twenty-five (25) franchised commercial haulers. Some of these franchised haulers also provide temporary debris box services to San Jose residences and construction sites.
The franchise grants the holder the right to compete with other franchisees to collect solid waste and commingled recyclables from non-residential properties in San Jose and to provide temporary debris boxes services to residences and construction sites. The franchise does not guarantee that the holder will obtain any San Jose customers. Franchise holders are free to compete throughout the entire City and are not limited to districts. The franchise authorizes the holder to perform collection services only and does not constitute permission to operate a solid waste facility or recycling center.
The City provides no compensation to the franchised haulers. The franchised haulers receive compensation directly from their customers. Service charges are agreed upon between the hauler and the customer and are influenced by direct competition between haulers. The City does not regulate these charges. Commercial customers are free to choose the franchised hauler that offers them the service that best meets their needs
Franchised haulers pay franchise fees to the City based upon the volume of solid waste service that they provide to San Jose customers. Franchised haulers also collect a Commercial Source Reduction and Recycling fee (AB 939 fee) from their San Jose customers and remit this fee to the City. The AB 939 fee is also assessed on the volume of solid waste service that a customer subscribes to (bin size multiplied by frequency of collection). There is also a franchise fee assessed on the collection of mixed recyclables, but it is currently set at $0 per cubic yard of service. Recyclables collection is not subject to the AB 939 fee. Exempting recyclables collection from these fees provides a financial incentive for commercial haulers and their customers to recycle by decreasing the cost of recyclables collection relative to garbage collection.
The City used to require haulers to obtain two separate franchise agreements: one authorizing the hauler to collect Commercial Solid Waste, and another authorizing the hauler to collect Mixed Recyclables. On May 11, 1999, Council approved amendments to the Municipal Code, which combined the Commercial Solid Waste and Mixed Recyclables franchises into a single franchise called a Commercial Solid Waste and Recyclables Collection Franchise, effective July 1, 1999.
Currently there are 25 companies that have valid franchise agreements. These agreements will expire on June 30, 2001. Twenty-six companies (24 of the existing companies plus two new companies) have applied for new franchise agreements. The new agreements will take effect on July 1, 2001.
ANALYSIS
Chapter 9.10 of the Municipal Code and the City Charter require that Commercial Solid Waste and Recyclables Collection Franchises be granted by ordinances of the City Council. Approval of the proposed ordinances will grant new non-exclusive Commercial Solid Waste and Recyclables Collection Franchises to the businesses listed above for a term beginning July 1, 2001, and ending June 30, 2003. To accommodate the issuance of the 5-Year Notification (see Information Memo distributed prior to this meeting) and help reduce the administrative burden on the haulers, the City has added three, one-year extensions to the agreements executable at the sole discretion of the Director of Environmental Services. Nothing will obligate the City to exercise these options.
The following company has applied for a franchise. However, staff has reviewed their records and recommends that they not be granted a franchise:
· Benny Scott Sr. dba All Trash Recycling
Benny Scott Sr. dba All Trash Recycling has an existing franchise agreement with the City; however, All Trash has not submitted any of the required monthly reports or any fees owed to the City during the entire term of their current agreement, which dates back to July 1, 1999. Staff has notified All Trash Recycling several times in writing via First Class and Certified mail of their delinquency. Each letter was followed-up with a phone call. Each time, both the letters and phone calls went unanswered. In March of 2001, the Environmental Services Department sent notification to All Trash Recycling that they were suspending All Trash Recycling’s Franchise Agreement due to non- compliance with payment and reporting requirements.
One Franchise Application, filed by All Points Roll Off Inc. was received incomplete. The application, check and envelope were returned with a letter describing why a franchise agreement would not be processed at this time. They were encouraged to complete the application and resubmit for processing at a later date. In addition to being submitted incomplete, the application was submitted on March 15, 2001, seven (7) weeks after the January 26, 2001 filing date. All other applications were received on time.
Each of the remaining companies listed above has a current San Jose business tax certificate and has submitted the required franchise application and application fee. Staff has reviewed their applications and has found no reason why those applicants should not be awarded a franchise at this time.
Two of the applicants, Pacific Rim Recycling and Smurfit-Stone Recycling, have never before held a franchise in San Jose. The other 23 recommended applicants all have current franchise agreements. Attachment A contains a brief description of each of the companies that has applied for a franchise.
In accordance with San Jose Municipal Code section 9.10.1650, the City Clerk published a notice in the San Jose Post Record announcing a public hearing at the May 8, 2001, Council meeting regarding the above mentioned franchise applications.
COORDINATION
This memorandum was coordinated with the Office of the City Attorney.
COST IMPLICATIONS
All applicants have paid the $195 application fee as required in San Jose Municipal Code 9.10.1670. All applicants will pay the General Fund a franchise fee of $2.84 for every cubic yard of solid waste service provided above the 24,600 cubic yard exclusion allowed for each franchised hauler. They will also remit to the City an AB 939 fee of $1.00 per cubic yard of service provided, which will go to Fund 423.
CEQA
Negative Declaration, File No. PP92-11-308.
CARL W. MOSHER
Director, Environmental Services Department
Attachment
ATTACHMENT A
DESCRIPTIONS OF COMPANIES APPLYING FOR
COMMERCIAL SOLID WASTE AND RECYCLABLES COLLECTION FRANCHISES
AAA EXPRESS ROLL-OFF
DISPOSAL has been operating in San Jose for six years. AAA is a sole proprietorship. AAA operates one roll-off truck and owns
eleven roll-off bins. There have been
no complaints received about their service.
BROWNING FERRIS INDUSTRIES has been operating in San Jose for 28 years. BFI is the second largest commercial hauler in San Jose. BFI will operate 19 vehicles in San Jose. BFI is a full service solid waste company that provides collection in carts, cans, front-load bins, roll-off bins, and roll-off compactors. In addition to solid waste, BFI collects the following recyclables from San Jose businesses: paper, cardboard, glass, metal, plastic, wood, inerts (concrete, asphalt, etc.), and yard trimmings. There have been minimal complaints about their service. BFI is also the exclusive yard trimmings collector for San Jose residents in District A and the exclusive solid waste collector for Milpitas and Fremont. In addition to hauling, BFI operates a landfill, recycling facility, and composting facility at its Newby Island site in North San Jose. All of BFI’s facilities are fully permitted. BFI has recently merged with Allied Waste Systems. BFI/Allied is a multi-national corporation headquartered in Texas.
BUTTERICK ENTERPRISES dba B & B ROLL-OFF SERVICE has been operating in San Jose for over 15 years. B&B Roll-Off is a sole proprietorship. B&B will operate one roll-off truck in San Jose and owns 55 roll-off bins. In addition to collecting commercial solid waste, B&B recycles paper, cardboard, metal, wood, inerts (concrete, asphalt, etc.), and yard trimmings.
CUSTOM DISPOSAL SERVICE has been operating in San Jose for 14 years. Custom Disposal is a sole proprietorship that operates one roll-off truck and owns 15 roll-off bins. City staff has not received any complaints regarding Custom Disposal during the term of the current franchise.
DIVERSIFIED RECYCLING SERVICES, INC. dba SAN JOSE RECYCLING II has been operating in San Jose for 13 years. San Jose Recycling II operates two roll-off trucks and owns 42 roll-off bins. There have been no complaints received about their collection service.
E.M.S., L.L.C. has never held a commercial hauling franchise. E.M.S., L.L.C. will operate three roll-off trucks and owns 40 roll-off boxes and four compactor boxes. They will collect source-separated recyclables such as paper, metal, wood, and inerts (concrete and asphalt) and transport them to City Metals, Recycled Fibers and Zanker Road Landifll for processing. E.M.S., L.L.C. is a sister company of an existing franchised hauler, The Flea Market, Inc.
GREEN VALLEY DISPOSAL CO., INC. has been operating in San Jose for 12 years and has been in business in the South Bay for 83 years. Green Valley is the third largest commercial hauler in San Jose. Green Valley will operate three front-load trucks and one roll-off truck. Green Valley is a full service solid waste company that provides collection in front-load bins, roll-off bins, and roll-off compactors. In addition to solid waste, Green Valley collects the following recyclables from San Jose businesses: paper, cardboard, wood, inerts (concrete, asphalt, etc.), and yard trimmings. There have been minimal complaints about their service. Green Valley is also the exclusive solid waste collector for Campbell, Los Gatos, Saratoga, Monte Sereno, and parts of unincorporated Santa Clara County. Green Valley was recently acquired by Waste Management.
GREENTEAM OF SAN JOSE dba GT WASTE SERVICES has been operating in San Jose for 3 years. GT Waste Services is the fifth largest commercial hauler in San Jose. GreenTeam’s biggest commercial customer is the City government. GreenTeam collects solid waste from City facilities, public litter receptacles, and neighborhood clean-up bins. Because the City pays for the disposal of these wastes, GreenTeam keeps City wastes separate from the waste of other customers by collecting them in separate vehicles. GreenTeam collects from City facilities under the name “GreenTeam” and collects from San Jose businesses under the dba “GT Waste Services.” GreenTeam has been collecting waste from City Facilities for five years and from San Jose businesses for 3 years. GreenTeam will operate four roll-off trucks and three front-loader trucks in connection with this franchise. GreenTeam does not collect the recyclables from City facilities. GT Waste Systems plans to collect the following recyclables from San Jose businesses: 1) source separated paper, metal, food waste, and inerts (concrete, asphalt, etc.), 2) commingled paper, cardboard, plastic, and metal, and 3) commingled cardboard, plastic, metal, and wood. There have been no complaints about their service. In addition to its commercial collection operation, GreenTeam is the exclusive collector of garbage and recyclables for single-family homes in San Jose’s District A and for multi-family dwellings citywide. GreenTeam owns and operates a fully permitted recycling facility located in San Jose. GreenTeam is a partnership of GreenWaste Recovery and Peninsula Sanitary Service.
GREENWASTE RECOVERY, INC. dba NINETY-NINE DOLLAR DEBRIS BOX has been operating in San Jose for eight years. $99 Debris Box specializes in providing temporary debris boxes to residences and construction sites. $99 Debris Box is the sixth largest commercial hauler in San Jose. The name, $99 Debris Box, does not mean that total charges for services will always be $99. The company will operate 13 roll-off trucks in connection with this franchise. The company sorts the majority of the loads it collects in order to recover recyclables and re-usable items such as appliances and furniture. The loads are sorted at GreenWaste Recovery’s fully permitted recycling facility in San Jose. $99 Debris Box collects the following source separated recyclables: paper, cardboard, wood, inerts, and yard trimmings. $99 Debris Box recovers paper, cardboard, metal, wood, and inerts from construction waste. There have been no complaints about their service. In addition to its commercial collection operation, GreenWaste Recovery is also the exclusive collector of residential yard trimmings in San Jose’s Districts B & C and the exclusive collector of solid waste in Woodside. GreenWaste Recovery is a partner in GreenTeam of San Jose. GreenWaste Recovery is a sister company to Zanker Road Resource Recovery, which owns and operates two construction/demolition recycling operations and a composting facility in San Jose, and the Z-Best composting facility located outside of Gilroy.
GREENWASTE RECOVERY, INC. has been operating in San Jose for ten years. The company will operate 13 roll-off trucks and one front-loader in connection with this franchise. The company sorts the majority of the loads its collects in order to recover recyclables and re-usable items such as metals and wood waste. The loads are sorted at GreenWaste Recovery’s fully permitted recycling facility in San Jose. GreenWaste Recovery collects the following source separated recyclables: paper, cardboard, wood, inerts, and yard trimmings. GreenWaste Recovery recovers paper, cardboard, metal, wood, and inerts from construction waste. In addition, GreenWaste will collect commercial food waste and transport it to the Z-Best processing facility in Gilroy. There have been no complaints about their service.
GRIFALL TRUCKING, INC. has been operating in San Jose for 31 years. Grifall Trucking has been contracted by the City to collect debris from City corporation yards. This debris includes the material collected by City street sweepers and illegally dumped materials collected from throughout the City by Streets and Traffic. Grifall uses its fleet of 11 dump trucks to haul the debris to the Newby Island Landfill. Grifall Trucking does not collect solid waste from any other San Jose customers except for the City corporation yards.
J.H.M. SERVICES, INC. has been operating in San Jose for twelve years. J.H.M. operates one roll-off truck and one front-loader truck and owns seven roll-off bins and 100 front-load bins. There have been no complaints about their service.
JONNA CORP. dba PREMIER RECYCLE has been operating in San Jose for eight years. Premier Recycle specializes in collecting and recycling waste from construction sites. Premier Recycle operates four roll-off trucks and uses 100 roll-off bins. Premier Recycle collects commingled metal, wood, and inerts. They also recover cardboard, wood, metal, and inerts from construction waste. Premier Recycle sorts the majority of the mixed loads they collect in order to recover recyclables. Premier Recycle sorts these loads at their San Jose recycling facility. There have been no complaints about their service.
JULIE COLEMAN ENTERPRISES, INC. dba PACIFIC RIM RECYCLING has never held a franchise before. They have been in business for fifteen years providing service to communities in the East Bay. Pacific Rim will operate four roll-off trucks and two front loader trucks. They own fifty roll-off boxes, thirty front loader bins, and six compactors. Pacific Rim will only collect source-separated paper, metals, and inerts and commingled beverage containers and paper. All of their materials will be taken to Smurfit-Stone Container Company. They provided in their application three references (two businesses and one local government) who have received hauling services from them. These customers were satisfied with the service that they received.
LOS ALTOS GARBAGE CO. dba STEVENS CREEK DISPOSAL & RECYCLING has been operating in San Jose for nine years and in the Bay Area for 78 years. Stevens Creek Disposal is an employee-owned corporation, and a subsidiary of Norcal Waste Systems. Stevens Creek is the fourth-largest commercial hauler in San Jose. They will operate 6 trucks in connection with this franchise. They are a full service solid waste company that provides collection in carts, cans, front-load bins, roll-off bins. They will collect the following source separated recyclables: paper, cardboard, metal, glass, plastic, wood, inerts, yard trimmings, and aluminum. They plan to collect the following commingled recyclables: 1) glass, metal, plastic 2) paper, cardboard, glass, metal, plastic 3) cardboard, wood, metal, inerts (construction mix). There have been no complaints about their service during the term of the current franchise. In addition to their San Jose operations, Los Altos Garbage Co. is the exclusive solid waste collector for Los Altos and Los Altos Hills.
MISSION TRAILS WASTE SYSTEMS dba RECYCLE WEST has been operating in San Jose for four years. Recycle West will operate two roll-off vehicles and a front-loader. In addition to solid waste, Recycle West will collect paper, cardboard and inerts (concrete, asphalt, etc.) for recycling. There have been no complaints about their collection service.
THE FLEA MARKET, INC. has never had a commercial hauling franchise. The Flea Market, located on Berryessa Rd., is one of San Jose’s largest businesses. It has been in operation for 31 years. The Flea Market has applied for a franchise because it wishes to haul its own waste to landfill. The Flea Market applied for a franchise in the past but was not issued one because at the time, franchise fees were based on gross receipts from hauling services, and the Flea Market was not going to charge itself for hauling. Now that the franchise fees are based on the volume of solid waste service, this is no longer an issue. The Flea Market will continue to pay franchise fees and AB939 fees based on the waste that it generates. The Flea Market will use two roll-off trucks and three roll-off bins to haul its own waste. The Flea Market does not plan to collect waste from any other businesses. The Flea Market will also haul its own recyclables to market, including cardboard, metal, and wood. The Flea Market is also investigating ways to recycle or compost the food waste that is generated at its produce stands.
THE NEWARK GROUP dba RECYCLED FIBERS has been operating in San Jose for ten years. Recycled Fibers collects source separated paper and cardboard in roll-off boxes, roll-off compactors, and bales. Recycled Fibers will operate two roll-off trucks in connection with this franchise. Recycled Fibers has held a commercial solid waste franchise for as long they have been active in San Jose but has never actually collected commercial solid waste. They maintained the franchise in case they were ever to acquire a customer that would not allow them to pick up paper unless they also picked up garbage. There have been no complaints about their paper collection service. In addition to their paper collection service, Recycled Fibers owns and operates a paper and cardboard buy-back center in San Jose. Their parent company, The Newark Group, owns a recycled paper mill in Santa Clara. Recycled Fibers uses its collection service and buy-back center to obtain feedstock for the paper mill in Santa Clara.
NUMBER “1” DISPOSAL has operated in San Jose for sixteen years. It is a sole proprietorship. Number “1” owns one roll-off truck and sixty roll-off bins. In addition to solid waste, Number “1” collects inerts such as concrete and asphalt for recycling. There have been no complaints about their service.
PANTHER INDUSTRIES has been operating in San Jose for three years and has been in business for twelve years. Panther Industries has been contracted to construct and maintain bus and light rail shelters for the Valley Transit Authority. Part of the maintenance involves collecting garbage from the 918 public trash receptacles located at the bus and light rail shelters in San Jose. Panther Industries collects this waste in a sealed side-loading compaction vehicle. Panther Industries collects trash from transit shelters throughout the county and delivers it to the Sunnyvale materials recovery and transfer (SMaRT) station and Newby Island Landfill. Panther Industries has been in business constructing, maintaining, and removing transit shelters and communications equipment in the Bay Area for 18 years. Panther Industries has no plans to collect waste from any customers other than the VTA transit shelters.
PHILLIP A. INGRAM dba COAST DUMPSTER SERVICE has been in operation in San Jose for 1 year. They currently operate two swap loaders and two roll-off trucks and own 41 roll-off boxes. Coast Dumpster collects source separated metal, wood, and inerts. They also recover cardboard, wood, metal, and inerts from construction waste. Coast Dumpster will take the materials to Guadalupe Mines Landfill for processing.
RECYCLING SYSTEMS has held a San Jose commercial hauling franchise for four years and has been in business for 14 years. Recycling Systems owns one flatbed dump truck. They will specialize in construction and demolition waste. In addition to solid waste, Recycling Systems plans to recycle the following materials: Metal, wood, inerts (concrete, asphalt, etc.), and yard trimmings.
SMURFIT-STONE CONTAINER CORPORATION dba SMURFIT-STONE RECYCLING has never held a franchise before. They have been in business in San Jose for over 10 years. Smurfit-Stone plans to subcontract the collection of recyclables to Pacific Rim Recycling (described above). Source-separated recyclables to be collected include paper, cardboard, and plastic bottles. Smurfit-Stone operates a processing facility in San Jose and a paper mill in Santa Clara
USA WASTE dba HOLLISTER DISPOSAL has been operating in San Jose for 13 years. They specialize in collecting waste from canneries and other bulk food processors. They recycle semi-solid food waste from canneries by applying it to farmland as a soil amendment. This semi-solid food waste is collected in a special vehicle. They also collect cardboard for recycling and landfill non-recyclable waste. Hollister Disposal became a subsidiary of Waste Management in 1998. There have been no complaints about their service.
WASTE MANAGEMENT OF CALIFORNIA, INC. dba WASTE MANAGEMENT OF SANTA CLARA COUNTY has been operating in San Jose for 15 years. Waste Management is the largest commercial hauler in San Jose. Waste Management will operate 42 vehicles in connection with this franchise. Waste Management is a full service solid waste company that provides collection in carts, cans, front-load bins, roll-off bins, and roll-off compactors. In addition to solid waste, Waste Management collects the following recyclables from San Jose businesses: paper, cardboard, glass, metal, plastic, wood, inerts (concrete, asphalt, etc.), and yard trimmings. Waste Management also collects commingled glass, metal, and plastic containers from San Jose businesses. Waste Management has also applied to the Director of ESD to collect commercial food waste. The collected material will eventually be transported to the Z-Best facility in Gilroy. There have been minimal complaints about their service. In addition to its commercial collection operation, Waste Management is the exclusive collector of garbage and recyclables for single-family homes in San Jose’s Districts B & C. Waste Management owns and operates a fully permitted recycling facility located in San Jose. Waste Management is also the exclusive solid waste collector for Oakland and several other cities in the East Bay. In addition to hauling, Waste Management owns and operates the Kirby Canyon landfill in South San Jose and the K&M wood waste recycling site in Berryessa. All of Waste Management’s facilities are fully permitted. Waste Management merged with USA Waste in 1998 and acquired Hollister Disposal as a part of that merger. Recently, Waste Management acquired Green Valley Disposal Company. Waste Management is a multi-national corporation headquartered in Texas.
Note: The vehicles enumerated are those that the company has available for use in San Jose. Most of these companies perform collection services in several cities using the same fleet of vehicles. In some cases, waste from multiple cities may be commingled in the same collection vehicle.