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CITYOFRIDGECREST

REQUESTFORPROPOSALS FOR SOLIDWASTEANDRECYCLABLEMATERIALSCOLLECTIONAND DIVERSIONPROGRAMS July1,2011


Preparedby:

CITYOFRIDGECREST
REQUESTFORPROPOSALS FOR SOLIDWASTEANDRECYCLABLEMATERIALSCOLLECTIONAND DIVERSIONPROGRAMS

Proposal Information: The City ofRidgecrest(City)issolicitingproposalsfromqualifiedcompaniesto providethefollowingservicestoitsresidentsandbusinessesforaperiodofsevenyears,withanoption fortheCitytoextendforuptoanadditionalfiveyears,for: 1. CollectionofsolidwastefromresidentialandcommercialaccountsandCityfacilities. 2. CollectionofrecyclablematerialsfromresidentialandcommercialaccountsandCityfacilities. 3. ProvisionofothersolidwasteanddiversionservicestotheCity,itsresidents,andbusinesses. Copies of this Request for Proposals (RFP) package maybeobtainedviadownloadoremail.Address requestsbytelephoneoremailtotheCitysproposalcontact: RobHilton HF&HConsultants 201NorthCivicDrive,Suite230 WalnutCreek,CA94596 (925)9776959 In addition, the Request for Proposals package can be obtained from HF&Hs website, http://www.HFHConsultants.com/RidgecrestRFP/index.html. Interested Parties: The City requests that any interested parties register with the Citys consultant usingthecontactinformationabove.Registeringasaninterestedpartywillensurethatyoureceiveany clarifications, addenda, or other information related to this RFP via email immediately upon release. SuchinformationwillalsobepostedtotheRFPdownloadwebsitelistedabove. Proposer Requirements: The City requests that proposers submit all questions and requests for information in writing (mail, fax, or email with confirmation request) to the Citys consultant and refrain from contacting other City employees or City Council members. Therefore, any questions, requestsforclarification,orrequestsforadditionalinformationregardingtheRFPshouldbesubmitted inwriting(viaU.S.PostalService,emailorfax,withconfirmationrequest)toRobHiltonattheaddress, email,orfaxnumberlistedaboveonorbeforeAugust1,2011.

PreProposalMeeting:TheCitywillbeholdingapreproposalmeetingonJuly11,2011at3:00p.m.: CityofRidgecrest 100WCaliforniaAvenue Ridgecrest,CA93555 (760)4995001 Allpartiesconsideringsubmittingproposalsarestronglyencouragedtoattendthismeeting. ProposalSubmittal:Allproposalsmustbereceivedby3:00p.m.onAugust1,2011.Proposalsreceived after this time and date may be rejected at the sole discretion of the City. Postmarks will not be acceptedasproofofreceipt.Proposersshallmailorhanddeliverproposalpackagesto: CityClerk CityofRidgecrest 100WCaliforniaAvenue Ridgecrest,CA93555

TABLE OF CONTENTS
SectionIOverview......................................................................................................................................1 SectionIIDescriptionofCurrentServicesandConditions.........................................................................5 SectionIIIScopeofRequestedServices .....................................................................................................7 . SectionIVProposalSubmittalProcess........................................................................................................9 SectionVProposalRequirements ............................................................................................................12 . SectionVIProposalEvaluationCriteria....................................................................................................21 LISTOFTABLES Table1RFPSchedule*...............................................................................................................................3 Table2CityPopulation&HousingCharacteristics....................................................................................5 Table3IWVWDWaterCustomers.............................................................................................................6 Table4CommercialSolidWaste&RecyclingRatesApprovedinSeptember2009..................................6 ATTACHMENTS Attachment1 DraftFranchiseAgreement Attachment2 ProposalForms Attachment3 AntiCollusionAffidavit Attachment4 SecretarysCertificate

CityofRidgecrest RequestforProposals

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Section I - Overview
OverviewoftheRequestforProposals
The City of Ridgecrest (City) is requesting proposals to provide solid waste and recyclable materials collectionanddiversionservicestoresidentsandbusinesseswithintheCityforaperiodofsevenyears, commencingonJanuary1,2012withuptofiveyearsinoptionalcontractextensions.Forpurposesof thisRFP,theCitymeanstheincorporatedareaoftheCityofRidgecrest.Theselectedproposerwillbe responsible for providing all of the required services at the proposed rates. The requested collection services are summarized in Section III and described in detail in Article 4 of the Draft Franchise Agreement (Attachment 1). Each proposer is required to review the Draft Franchise Agreement as it definesthespecificcontractualrequirementsfortheservicestobeprovided.Intheeventofaconflict between the Draft Franchise Agreement and this RFP, the proposer should assume that the Draft FranchiseAgreementcontrols.

CitysObjectives
The Citys primary objective for this RFP is to procure an effective and efficient integrated waste management service provider for the residents and businesses in the City, including solid waste and recyclingcollectionservices.ThroughthisRFP,theCityseeksto: MinimizethecostofsolidwasteandrecyclingservicestotheCitysresidentsandbusinessesby reducingratesfromcurrentlevels. Achieve and maintain compliance with state regulations regarding integrated waste managementanddiversion,includingbutnotlimitedtoAB939; Ensure reliable, courteous, and high quality services are provided to the Citys residents and businesses;and,

Background
Ridgecrest is a remote community with robust modern amenities and a constituency that is conservative and highly educated. Historically residents and businesses have enrolled in voluntary curbsidewastehaulingservicewiththeCitysfranchisedwastehauler.FollowinganIntegratedWaste Management (CalRecycle) finding of inadequate AB 939 diversion levels, the City was fined and subsequently adopted mandatory curbside trash and recycling ordinances as part of the Local AssistancePlan(LAP)inresponsetoacomplianceorder.Thiswasasourceoffrustrationforresidents whowereuncomfortablewiththerapidchangesandaccompanyingrateincreasesassociatedwiththe process.TheCitylaternegotiatedachangetotheLAPallowingresidentstovoluntarilyoptoutofthe mandatoryresidentialserviceprovisions.Thisactionwasthesourceofdisputesandlegalactionswith thecurrenthauler.Thosedisputeshavebeenlargelyresolvedandthelegalproceedingshaveverified theexpirationdateofthecurrentfranchiseasSeptember2,2011.

CityofRidgecrest RequestforProposals

Manyresidentsandbusinessownershaveenduredunintendedconsequencesthroughoutthisprocess and have heightened concerns about the future of waste and recycling in Ridgecrest. The process of enteringintoanewfranchiseagreementpresentsarareopportunitytosolvemanyoftheissuesthat led to conflict over the last few years. The successful hauler will need to communicate with and be responsivetotheneedsofcitizensandstateregulatoryagencies. TheCityrecentlyimplementedapublicoutreachcampaigntosolicitinputfromcitizenswithrespectto the new franchise agreement. In addition to responsiveness and communication, residents and businesses were also concerned about other key items including: rate decrease (added emphasis for seniors), bin size options to reflect limited waste production of particular demographics, ability to consolidate bins in multifamily or strip mall configurations, frequency of recycling pick up, vacation holds(withinspecifiedparameters),billingbyfranchisee,optionalservice,educationaboutoptionsand recycling (what is recyclable, etc.), hazardous materials pick up (medical needles, etc.), periodic bulky itempickup,andcustomerincentives.TheCitywelcomesvendorinputonhowbesttoaddressthese issues.

CitysRights
TheCouncilreservestherighttotakeanyandallactionsitdeemsinitsinterestrelatedtothisRFP.The Council may reject all proposals, and may thereafter instruct the City Manager to take such further actionastheCouncilshalldirectincluding,butnotlimitedto,engaginginnegotiationswithoneormore firms, persons or entities, or issuing a revised request for proposals. The Council may also, at its discretion,waiveanyminorirregularitiescontainedinaproposal. NotwithstandinganyotherprovisionoftheRidgecrestMunicipalCode,theCouncilmay,uponfinding thatitisinthebestinterestoftheCityanduponavoteoftheCouncil,waivethecompetitiveprocess andmayinstructtheCityManagertotakesuchfurtheractionastheCouncilshalldirectincluding,but not limited to, requesting best and final offers, engaging in negotiations with one or more firms, personsorentities,orengaginginsuchotherprocessastheCouncilmayspecify.

GeneralRFPAgreements
ThisRFPshallnottobeconstruedbyanypartyasanagreementofanykindbetweentheCityandsuch party.ThisRFPdoesnotobligatetheCitytoacceptanyproposal,negotiatewithanyproposer,award anagreement,orproceedwiththedevelopmentofanyprojectorservicedescribedinresponsetothis RFP.TheCityhasnoobligationtocompensateproposer(s)fortheexpenseofpreparingtheproposal(s) andparticipatinginthisprocurementprocess. ProposalsmustcomplyfullywiththerequirementsdetailedinthisRFP,includingallattachmentsand addendatotheRFP.Requiredsupportingdocumentationmustbeincludedandmustbeappropriately identified.TheCitymayreject:incompleteproposals;proposalscontainingerrors,inconsistencies,false, inaccurateormisleadinginformation;proposalsnotsubmittedwiththeproperquantityofcopies;or, proposalswithotherprocessorcontenterrorsordeficiencies. Submission of a proposal shall constitute acknowledgment and acceptance of all the terms and conditionscontainedinthisRFPandtheDraftFranchiseAgreement,asappropriate,unlessanexception

CityofRidgecrest RequestforProposals

to specific terms and/or conditions is expressed in writing in the proposal. Submittal of a proposal signifiesproposerscommitmenttoprovidetheproposedservicesifselected.Proposalsrespondingto thisRFPmaynotbealteredaftersubmittal,exceptinresponsetoCitysrequestforclarification,andare firmforaperiodof180daysfromthedatetheproposalissubmitted. The City shall have the right (but not the obligation) to perform, and each proposer must agree to cooperate with, an investigation and review of each proposer's ability to perform the work required. Suchcooperationbyproposersshallapplynotonlytotheverificationoftheproposer'scapabilityand experienceintheprovisionofservicesbutalsototheprovisionofanyothercomponentofworkwhich mayberequiredunderthisprocurement.

ProcessandSchedule
TheproposalsubmittalprocessisdescribedinSectionIV.Thekeyactivitiesandcompletiondatesare providedinTable1below. Table1RFPSchedule* ACTIVITY CityIssuesRFP CityHoldsPreProposalMeeting CityReceivesFinalWrittenRFPandDraftFranchiseAgreement Questions/CommentsfromProposers July26,2011 CityIssuesAddendumtoRFPandDraftFranchiseAgreement August1,2011 CompaniesSubmitProposals August29September2,2011 ProposerInterviewsConducted(ifnecessary) September23,2011 CityCompletesProposalEvaluation October1,2011 CityCouncilSelectsContractorforNegotiation October21,2011 CityCompletesNegotiationswithContractor November1,2011 CityCouncilApprovesSelectionofContractorand ContractorReceivesFormalAuthorizationtoProceed NovemberandDecember,2011 Implementation,CustomerEducation,andOutreach January1,2012 ContractorCommencesServices *SubjecttochangebyCity. COMPLETIONDATE July1,2011 July11,2011 July22,2011

FranchiseAgreementComments
Aspreviouslynoted,theDraftFranchiseAgreementisprovidedasAttachment1tothisRFP.Proposers are to clearly note any exceptions to the Draft Franchise Agreement as part of their proposals, as specifiedinItem4(ExceptionstoAgreements)ofSectionVofthisRFP.TheCitywillnotconsiderany changes to the Draft Franchise Agreement during negotiation of a final agreement that are not identifiedinthecompanysproposal.

CityofRidgecrest RequestforProposals

Subcontractors
The City expects that the services detailed herein and in the Draft Franchise Agreement will be substantiallyperformedbytheprimeproposer,particularlythoseservicesthatinvolvecontactwiththe public.TheCityiswillingtoentertainproposalsincludingsubcontractorswhowillperformsomeorall of the following services, to the extent that the subcontracted services come at a lower cost than if performedbytheprimaryproposer: Containerdistribution; Processingofrecyclablematerials;and, Publiceducationandoutreachservices.

Proposalswhichanticipatetheuseofsubcontractedservicesmustincludeallinformationrequestedof the proposer for each subcontractor (applicable to the services they will provide) as well as a clear descriptionoftheservicestobeperformedbyeachsubcontractor.Proposersdonotneedtoidentify supplyvendorsorothervendorswhoseroleisnotprimarytotheservicesbeingprovided.

CityofRidgecrest RequestforProposals

Section II - Description of Current Services and Conditions


The information presented in this section isforinformationalpurposesonly.Theproposeragreesto indemnifyandholdtheCityharmlessfromanyclaimsordamagesincurredbyproposerforitsreliance on this data. Each proposer should take whatever steps it believes are necessary to reasonably determinetheactualcollectionserviceneedsoftheCityandunderstandcurrentandproposedservice conditionsintheCitywhenpreparingitsproposal.

DescriptionofCurrentServices
TheCityscurrentfranchiseeprovidesweeklysolidwasteandrecyclingcollectionservicestoresidential customersthroughouttheCity.Inaddition,businesscustomersthroughouttheCityreceiveservicein cartsorbinsuptosixdaysperweekforsolidwasteanduptoonedayperweekforrecycling.Dueto the arid climate and minimal vegetation, the City does not have a green waste collection program. Residents and businesses who generate green waste materials can selfhaul those materials to the RidgecrestLandfillfordiversion. SolidwastecollectedintheCityistakentotheKernCountyRidgecrestLandfillfordisposal.TheCityis currently working with the County to gather data regarding the total tonnage delivered and bin fees paid.Assoonasthatdataisavailable,theCitywillreleaseittoallinterestedparties. RecyclablematerialscollectedintheCityaretakentotheTehachapiMaterialsRecoveryFacility(MRF). The total volume of material processed at the Tehachapi MRF is not known at this time. If that information becomes available, the City will share it with all interested parties as promptly as is practical.

DescriptionofServiceArea
Inordertofurtherassistproposerswithanunderstandingofthedemandsofthearea,somepopulation andhousingcharacteristicsareprovidedinTable2. Table2CityPopulation&HousingCharacteristics Total Population 27,768 TheIndianWellsValleyWaterDistrictprovidedtheCitywiththeinformationinTable3regardingthe numberofcustomers,bycustomerclass,thataresubscribedtowaterservice.WhiletheIndianWells ValleyWaterDistrictencompassesanarealargerthantheCity,theCitypresentsthisinformationasan additional data point for potential proposers to use in estimating the service demands of the community. Total HousingUnits 11,972 Occupied Units 10,852 Vacant Units 1,120 Vacancy Rate 9.36%

CityofRidgecrest RequestforProposals

Table3IWVWDWaterCustomers SingleFamily 11,037 As a final data point for consideration by proposers, the City received unaudited customer account information from the current franchisee in 2009thatidentified9,400residentialand400commercial accounts. Additional, more recent information regardingthenumberofaccountsandlevelsofserviceprovided currentlywasnotmadeavailablebythecurrentfranchisee;therefore,eachproposershouldundertake theirownduediligenceefforttodeterminethequantityandnatureofserviceneededintheCity. MultiFamily 686 Commercial 821

RateInformation
TheCityanticipatesthattheselectedproposerwillprovideserviceatratessignificantlylowerthanthose currently in place. The current residential rate for trash service only is $18.11. The current residential ratefortrashandrecyclingserviceis$30.52.Commercialrateswereapprovedin2009forthecurrent franchiseewhichincludedprovisionofbothsolidwasteandrecyclingservice.Thoseratesarepresented inTable4below. Table4CommercialSolidWaste&RecyclingRatesApprovedinSeptember2009 ServiceLevel (1)96Gal,1x/wk (2)96Gal,1x/wk 3YD1x/wk 3YD2x/wk 3YD3x/wk 3YD4x/wk 3YD5x/wk 3YD6x/wk Rate $40.00 $50.47 $176.17 $282.88 $389.75 $496.31 $603.21 $710.09

CityofRidgecrest RequestforProposals

Section III - Scope of Requested Services


ExclusiveNatureofFranchise
Except as summarized below and specified in the Draft Franchise Agreement (Attachment 1) and the RidgecrestMunicipalCode,solidwastecollectionservicesforresidentsandbusinesseswithintheCity shall be provided exclusively by the selected contractor. No person, firm or entity who is not the contractorshallcollectsolidwasteofanytypewithintheCity;andnoresidentorbusinesswithinthe Cityshallsolicitcollectionservicefrom,orenterintoanycontractwithaproviderofcollectionservices whoisnottheselectedcontractor.Theselectedcontractorwillalsoberequiredtoofferandprovide diversionservicesincludingcollectionofrecyclablematerialsfromcustomersrequestingsuchservice. Theservicestobeofferedandprovidedbytheselectedcontractorwillnotbemandatedbyvirtueof propertyownershipandanypropertyownerortenantshallbeallowedtoselfhaultheirownwasteand recyclablematerials.

ServicestoBeProvided
The services to be provided by the Contractor are detailed in Section 4 of the Draft Franchise Agreement and the key services are summarized below. Proposers should review Section 4 of the Agreementforthedetailsofhowprogramsandservicesaretobeprovided. 1. CollectionserviceswithintheincorporatedareasoftheCityshallbeprovidedexclusivelybythe ContractorselectedexceptasspecifiedintheDraftFranchiseAgreement.Providingcollection servicesmeansprovidingsolidwasteandrecyclablematerialscollectionservicetoanyresident or business in the incorporated area of the City requesting such service. The City is in the processofrevisingitsmunicipalcodetorequireserviceforalloccupiedcommercialpremises. 2. Contractorshallprovideaneffectiveandefficientintegratedwastemanagementsystemforthe City, including solid waste and recycling collection and other diversion services for residential andcommercialaccounts(includingCityfacilities)subscribedtothecontractorsservices. 3. Contractor shall provide a bulky waste collection program to residential and commercial customersonanoncallbasisuptothreetimesperyearatnoadditionalchargetocustomers. Contractorshallofferadditionalbulkywastecollections(beyondtheinitialthreeperyear)atan additionalchargetocustomersrequestingsuchservice. 4. Contractorshallmakeavailableandprovideatnoadditionalcharge,cartandbincontainersin an appropriate size and collection frequency to any residential or commercial customer subscribingtoContractorsservice. 5. Providing all program elements required by the pending State regulations for mandatory commercial recycling under the AB 32 scoping plan including, at a minimum, the provision of collectionservices,education,outreach,monitoring,andreportingforallcommercialandmulti familypropertiesincludedinthatregulationifandwhenitisadopted.

CityofRidgecrest RequestforProposals

6. ContractorshallbillservicerecipientsdirectlyforservicesbasedontheCityapprovedratesand remittheappropriatefeestotheCityandpaymentsforuseoftheKernCountylandfillsystem totheCountyasprescribedbytheKernCountyWasteManagementDepartment. 7. ContractorshallprovideregularreportingonitsactivitieswithintheCitytotheCityscontract managerasspecifiedinExhibitDtotheDraftFranchiseAgreement. 8. Contractor shall provide all public education and outreach services required to adequately inform residents and businesses about such topics as: the appropriate materials to place for recycling as well as those materials which are prohibited; the materials which are prohibited fromdisposalandappropriatedisposaloptionsforthosematerials;theimportanceandvalueof wastereduction,reuse,recyclingandcomposting;and,thecostsavingopportunitiesresulting from recycling at businesses. Contractors proposal shall include a detailed public education and outreach plan describing how Contractor intends to implement a public education and outreachprogramintheCity.

ProposalEnhancements,Innovation,andCostSavingApproaches
The City recognizes that the companies that propose on this RFP have expertise in the operation of integrated waste management systems and the City wishes to benefit from expertise as much as is practical and beneficial to the Citys residents and businesses. Proposers are encouraged to propose modificationstothesystemdescribedinthisRFPandDraftFranchiseAgreementifthosemodifications willresultinanintegratedwastemanagementsystemthatmoreeffectivelymeetstheCitysobjectives. Suchproposalenhancementsshouldbeproposedinadditionandnotasareplacementtothestandard specificationscontainedinthisRFPandDraftFranchiseAgreement.

ReimbursementofProcurementCosts
The selected proposer(s) will reimburse the City procurementrelated expenses (including, but not limited to, consulting fees and legal fees). The procurementrelated reimbursement payment will be made by the selected proposer(s) no later than the execution date of the Agreement. The procurementrelatedreimbursementexpenseis$140,000.

CityofRidgecrest RequestforProposals

Section IV - Proposal Submittal Process


Companies submitting proposals to the City shall follow the procedures described in this Section and theproceduresincludedinanysubsequentaddendaorclarificationstothisRFPissuedbytheCity.

StepOneWrittenQuestions
TheCityrequeststhatproposerssubmitallquestionsandrequestsforinformationinwriting(mail,fax, or email with confirmation request) to the Citys proposal contact and refrain from contacting other CityemployeesorCityCouncilmembers.Anyproposerwhoisdeterminedtohavecontactedamember of the City Council regarding this RFP may be disqualified. Therefore, any questions, requests for clarification,orrequestsforadditionalinformationregardingthisRFPortheDraftFranchiseAgreement shouldbesubmittedinwriting(preferablyviaemail)toRobHiltonattheaddresslistedbelowonor beforeJuly22,2011. RobHilton HF&HConsultants 201NorthCivicDrive,Suite230 WalnutCreek,CA94596 (925)9776959 rchilton@hfhconsultants.com

StepTwoPreProposalMeeting
A preproposal meeting will be held at the Ridgecrest City offices on July 11, 2011 at 3:00 p.m. ProposersmaysubmitwrittenquestionsrelatedtotheRFPandDraftFranchiseAgreementpriortothe preproposalmeetingviaemailtorchilton@hfhconsultants.comasdescribedinstepone.Inaddition, oralandwrittenquestionswillbeacceptedatthepreproposalmeeting.Asappropriate,preliminary oralresponseswillbeprovidedatthatmeeting.AdditionalquestionsmaybesubmitteduptoJuly22, 2011.TheCitywillissueanaddendumtotheRFPbyJuly26,2011respondinginwritingtoallquestions received. In the event of any inconsistencies between oral and written responses to questions, the writtenresponsesshallbeusedforthepurposesofpreparingproposals.TheCitymay,atitsdiscretion, issuearevisedDraftFranchiseAgreementatthattime.

StepThreeProposalSubmittal
Proposersshallsubmitfivebound,doublesidedcopiesoftheircompleteproposal.Proposalsmustbe printed on a minimum of 30% (100% encouraged) postconsumer recycled content paper and bound copies must be doublesided. In addition, a computer disk shall be submitted and shall contain an electronic copy of the proposal, all completed proposal forms in Microsoft Excel format (i.e., those provided in Attachment 2 of the RFP), and a Microsoft Word redline/strikeout version of the Draft FranchiseAgreement.

CityofRidgecrest RequestforProposals

Thepackageshallbesealedandclearlylabeled: CITYOFRIDGECRESTSOLIDWATEANDRECYCLINGSERVICESPROPOSAL FROM: NameofProposer: Address: ContactPerson: TelephoneNumber: FaxNumber: Email:

Theproposalmaybemailedorhanddeliveredto: CityClerk CityofRidgecrest 100WCaliforniaAvenue Ridgecrest,CA93555 Allproposalsmustbereceivedby3:00p.m.onAugust1,2011.Proposalsreceivedafterthistimeand datemaybereturnedunopened.Postmarkswillnotbeacceptedasproofofreceipt.

StepFourClarificationofProposalInformation
Proposersmaybeaskedtoclarifyinformationthroughwriting,interviews,orsitevisitswithCitystaffor itsconsultant.TheCityreservestherighttoincorporateanywrittenclarificationsorothersupporting documentintothefranchiseagreementasamaterialelementoftheagreement.

StepFiveContractorSelection
The City anticipates reviewing the proposals received and recommending to the City Council the selection of one or more proposers for negotiation of a final franchise agreement. That recommendationshallnotbebindingontheCityCouncil.

StepSixNegotiations
OncetheCityCouncildirectsstafftonegotiateafinalfranchiseagreementwithoneormoreproposers, Citystaffandtheirconsultantshallschedulemeetingswiththeselectedfirms.Timeisoftheessencein theprocurementoftheseservices,therefore,thenegotiationswillbelimitedtothoseitemsidentified in the companys proposal as exceptions to the franchise agreement. Each proposer is required to submit a redline/strikeout version of the franchise agreement noting any deletions of franchise languageorrequirementsaswellasallreplacementlanguageornewlanguage.TheCitywillnotdiscuss anyotherchangestothedraftfranchiseagreementthatarenotclearlypresentedintheproposal.

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CityofRidgecrest RequestforProposals

The City expects that the selected proposer(s) will make themselves available promptly to start the negotiationsprocessandwillnegotiateexpeditiouslyandingoodfaithtoensureapromptresolutionto theprocess.IntheeventthattheCitydeterminesthataselectedproposerisnotcooperatingwiththis process, they may recommend to the City Council that an additional or replacement proposer is selectedforsuchnegotiation. At the conclusion of negotiations the proposer will be expected to execute the negotiated franchise agreementpriortopresentationtotheCityCouncil.

StepSevenDeterminationofAwardofContract
CitystaffanditsconsultantwillpresenttheresultsofthenegotiationsprocesstotheCityCouncilfor theirconsideration.Atthattime,theCityCouncilmay: 1. Awardacontracttothesuccessfulproposer; 2. Directstaffandtheproposertonegotiatefurther; 3. Directstafftonegotiatewithadditionalorreplacementproposers;or, 4. Canceland/orrestartthisprocess.

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CityofRidgecrest RequestforProposals

Section V - Proposal Requirements


This section includes the required outline for the proposal as well as a description of the specific informationtobeincludedineachsectionoftheproposal.Ataminimum,theproposeristoprovideall information required in this section as part of its proposal. Proposals should be focused on demonstrating the proposers ability to fulfill the obligations of the Franchise Agreement. Failure to provideallrequiredinformationmaybegroundsforrejectionofaproposal.

ProposalOutline
Thefollowingoutlineshallbeusedbyproposerswhencompletingtheirproposals: i. ii. TitlePage Cover Letter (signed by the designated representative shown on Secretarys Certificate, Attachment4,authorizedtobindtheproposingcompany) TableofContents CompanyDescription 1.1 1.2 1.3 BusinessStructure DescriptionofProposersExperience Information Regarding Litigation, Regulatory Actions, and Payment of Liquidated Damages KeyPersonnel

iii. 1.0

1.4 2.0

TechnicalProposalforServices 2.1 2.2 2.3 2.4 2.5 2.6 Collection Processing RecyclingPlan PublicEducation&OutreachPlan Billing&CustomerServiceApproach ProposedServiceEnhancementsandInnovations

3.0

ProposalForms 3.1 GeneralProposalInformation

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CityofRidgecrest RequestforProposals

3.2 3.3 3.4 3.5

OperatingStatistics StaffingPlan EquipmentPlan AnnualOperatingCostEstimate CartandBinRateProposal DropBoxandCompactorRateProposal

4.0 5.0 6.0 7.0

3.4 3.5

ExceptionstoFranchiseAgreement ImplementationPlanandSchedule AntiCollusionAffidavit SecretarysCertificate

1.0
1.1

CompanyDescription
BusinessStructure 1. Identify the legal entity(ies) that would execute the Franchise Agreement. State whether eachentityisasoleproprietorship,partnership,corporation,orjointventure.Describein detail the relationship of the proposer to the executing entity. If the proposer is a joint venture,describewhereandhowtheentitieshavecollaboratedbefore. 2. Statethenumberofyearstheproposingentity(ies)havebeenorganizedanddoingbusiness. Proposalshouldincludeallthenamesofproposers(andexecutingentitiesifdifferentthan proposers)owners/stockholderswithgreaterthanatenpercent(10%)holdingandcreditors owedadebtgreaterthantenpercent(10%)ofthecompany'stotalassets. 3. Identifyotherentitieswithcommonownershipand/ormanagement.

1.2

DescriptionofProposersExperience 1. Statewhethertheproposeriscurrentlyprovidingmunicipallyfranchisedservicestosimilar communities,andifso,describethetypeofservicesprovidedandthenumberofaccounts bycustomertype. 2. Provide references from at least three jurisdictions or large customers with demographic conditionssimilartotheCityofRidgecrestwherecontractorisprovidingservicessimilarto those described in this RFP. Include the name, address, and telephone number of each jurisdictions representative responsible for administering the agreement. Contractor shall be responsible for identifying references that will be cooperative with this process. Any referencethatdeclinestocommentorotherwisecooperatewiththeCitysreferencechecks shallbedeterminedtobeanegativereference.

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CityofRidgecrest RequestforProposals

1.3

InformationRegardingLitigation,RegulatoryActions,andPaymentofLiquidatedDamages Describeallpastandpendingcivil,legal,regulatory,andcriminalactionsnowpendingorwhich haveoccurredinthepast5yearsagainstkeypersonnel(asidentifiedbytheproposerinSection 1.4), proposing entity, and all subsidiaries owned by proposing entity in California. List the amount of liquidated damages the proposing entity has paid, the name of the jurisdiction to whichdamageswherepaid,andtheevent(s)whichtriggeredthedamages.

1.4

KeyPersonnel Providethenames,contactinformationandqualificationsforthefollowingkeypersonnel: RegionalManager DistrictManager SiteManager OperationsManager CustomerServiceManager

Alsoprovidethename,contactinformationandqualificationsforthepersonwhowillserveas theprimarycontactpersonfortheCityduringthetermoftheFranchiseAgreement.

2.0
2.1

TechnicalProposalforServices
Collection Each proposer shall describe how it plans to perform the solid waste and recycling collection services requested in the RFP and described in the Franchise Agreement. Specifically, information should address solid waste separately from recycling and services to residential, commercial, drop box, and compactor customers separately for each customer type. The proposal should include a description of the proposed collection program and logisticsforthe bulky waste collection program (Section 4.4.A of the Draft Franchise Agreement). Include at a minimumforeachprogram: Typeofvehiclesused(e.g.,frontloader,rearloader); Typeandsizeofcontainerstobeprovided; Customer setout requirements (e.g. curbside, three feet from other containers or vehicles); Estimateofparticipationlevelsandvolumes; Acceptableandprohibitedmaterials;and, Any special services offered (e.g. battery collection) by the proposer and/or requirementsplacedoncustomers(e.g.pushouts).

2.2

Processing Each proposer shall submit the following information to describe the recyclable materials processingservicestheywillprovide:

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CityofRidgecrest RequestforProposals

A.

Processing Site Information. Name, location, and description of the processing facility(ies)whererecyclablematerialswillbehandled;nameoftheownerandoperator ofthefacility(ies);contactnameandphonenumberofthesitemanager;and,thecurrent averagemonthlyresidueleveloftheprocessingsite.Identifyifthecompanythatownsor operates the processing site is the same as the proposing entity or is a relatedparty entity. Transfer Site Information. Since there are no current transfer or material processing facilitieswithinorneartheCity,itisanticipatedthatthesuccessfulcontractorwillneed todevelopsomestrategyfortransferringrecyclablematerialstoaprocessingfacilityafter they are collected in the City. Each proposer should describe their plans for moving recyclable materials collected in the City to the processing facility including any costs (under2.2.Fbelow)incurred. PermitsandRegulatoryCompliance.Providecontactnamesfortheregulatoryagencies thatmonitortheprocessingfacilityscompliancewithapplicablelocal,state,andfederal lawsandregulations.Foreachcontact,providethenameoftheregulatoryagency,and thecontactpersonsname,title,andtelephonenumber. FacilityRecyclingInformation.Describethetypeoffacility(e.g.singlestreamMRF,dual stream MRF, mixed waste MRF, etc.), how that facility operates to maximize material recovery and minimize residue, and how that facility approaches the marketing of recyclablematerials. AcceptableandProhibitedMaterials.Providealistofthematerialsacceptedandsoldto marketsbythefacilityfromcurbsiderecyclingprograms.Theselectedproposerslistwill beincorporatedintothedefinitionofRecyclableMaterialsforthepurposesofthefinal FranchiseAgreement. Costs.Providethenetpertonrevenueornetpertonprocessingcostand,ifapplicable, perton transfer station fees effective on the commencement date of the Franchise Agreement.Listseparatelyanyregulatoryfees,taxes,orsurchargesincludedinsuchcost.

B.

C.

D.

E.

F.

2.3

RecyclingPlan Proposers shall describe, in detail, how they plan to comply with the Diversion and Recycling Requirements specified in the Citys Source Reduction and Recycling Element and the CalRecycle/City of Ridgecrest Compliance Order (Exhibits E and F of Attachment 1, Draft Franchise Agreement). Specifically, information should separately address planned diversion operations,programsand/ormethodsfordiversionofmaterialfromresidentialandcommercial generators.Includeataminimum: Adescriptionofanyproposedsourceseparationdiversionprogram(s); Adescriptionoftheproposersapproachforacknowledging/rewardingtherecycling effortsofindividualcustomersand/ortheserviceareaasawhole;and, Adescriptionofanydiversiontobeachievedthroughsegregationofmaterialsata transferstationormaterialrecoveryfacility(ies);

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CityofRidgecrest RequestforProposals

A description of other innovative solutions to be provided that may increase diversionlevels.

2.4

PublicEducationandOutreachPlan The City places importance on effective public education andpromotionasthekeytohelping residentsandbusinessesunderstandmoreaboutsourcereduction,reuse,andrecycling.Thisis particularly important in this case because the recycling program will be based on the subscriptionofcustomerstotheprogramandtheneedtoadvertiseandpromotethatprogram toensureitseffectiveness.Theindependenteffortsoftheselectedcontractorwillbecriticalto the success of their programs. Each proposer shall describe the following separately for residentialandcommercial(includingCityfacilities)services: Public education programs that will be implemented for the proposed recyclable materialsandorganicmaterialsprograms. Plans for, if any, presentations to schools, churches, and other community organizations. Planfordevelopmentofemployee/tenantrecyclingprogramtrainingbrochuresor othermaterialstobeprovidedtobusinessownerorpropertymanagers. PlansforparticipationatCityorothercommunityevents,suchasbooths,displays, sponsorship,paradefloats,etc. Outreachandwasteauditstoidentifyadditionalrecyclingopportunities,ifany. Schedule, description, and quantity of information that will be distributed (e.g., newsletters, brochures, etc.). Example materials from other jurisdictions are encouraged. Proposed number of hours per week that will be devoted to the promotion and maintenanceofeachoftheprograms. Publiceducationandoutreachstafforsubcontractorsqualifications,resumes,years ofexperience,andreferences. Samples of similar educational materials, which may have been used in other programs. Proposedannualbudgetforpubliceducationandoutreach.

2.5

BillingandCustomerServiceApproach

The proposer should describe its suggested approach for providing billing services and excellent customerservicetotheCityanditsresidentsandbusinesses.Thisdescriptionshould,ataminimum, includeinformationregarding: Billing Describehowtheproposerwilldevelopthenecessarycustomerserviceandbillingdataat thestartofservices,acknowledgingthatdatafromthepriorserviceproviderwilllikelynot beavailable.Suchadescriptionshallincludetheproposersapproachforidentifyingservice needsandprocessforauditingandverifyingtheaccuracyofdataintheContractorssystem. 16 CityofRidgecrest RequestforProposals

Provide sample of customer bills and a listing of jurisdictions where proposer currently providesbillingservices,includingacontactnameandphonenumber. Describeallacceptablepaymentmethodsincludingcontractorsexperiencewithautomated paymentsystemsandwebsitebasedpayments. Describecontractorsapproach,includingfrequency,forperformingauditsofservicelevels andbillingtoensurethatallcustomersarebeingbilledproperly. Describeitsproceduresfordealingwithcustomerservice,withregardstocustomerbilling demands,duringthetransitionandthroughoutthetermoftheAgreement. Provideadescriptionofproposersexperiencewithbaddebtinothercommunitieswhere proposer currently provides service. This description should list each community, the number of customers in that community, and the bad debt ratio (expressed as the percentageofuncollectablebillingsrelativetototalbillings).

CustomerService Describethelocationwherecustomerserviceoperationwillbehoused. SpecifythenumberoffulltimeequivalentCustomerServiceRepresentatives(CSR)thatwill servetheCity.Describehowcallswillbehandled/reported,howmanycallsareexpected per CSR, and describe any changes you will make to your current CSR operation to accommodatetheCity. Describe procedures to satisfactorily respond to, record, and report common customer complaints such as: missed pickups; spills and litter resulting from collection; collection schedule changes; broken or missing containers; improperly prepared setouts; noise complaints;trafficandsidewalkobstructionduringcollection;and,safetyaroundcollection vehiclesduringoperations. Describe training programs for CSRs including how the CSRs will gain knowledge of the FranchiseAgreementtermsaswellasthelocalneighborhoods,streets,andcustomers. Describeyourcompanysperformancestandardsrelativetocustomerserviceintermsof: Maximum resolution time (resolution time means the duration of time from the receiptofthecustomerscomplaintuntilthetimethatthecomplaintisresolvedtothe customerorCityssatisfaction) Averageresolutiontime Maximumcallcenterholdtime Averagecallcenterholdtime Emailandwebsiterequestresponsetimes

2.6

ProposedServiceEnhancementsandInnovations

Proposersareencouragedtosubmitoneormoreproposalsforserviceenhancements,innovations,or costsaving approaches. Examples of possible service enhancements and innovations may include strategieslikelessfrequentcollection,dirtyMRFing,manualcollection,splitbodycollectionvehicles, oruseofcustomerprovidedcontainers.Foreachproposalforinnovativeand/orcostsavingservices,

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CityofRidgecrest RequestforProposals

proposershallprovideathoroughdescriptionofitsplansfortheprogram,including,butnotlimitedto, thefollowing: Thetypeandnumberofcustomersthatwouldbetargetedandbasisforestimatedtonnage levelsandcustomerparticipationlevels; Collectionmethodology; Equipmenttobeutilized(e.g.,equipment/vehicledescription,number,types,cost.capacity, age, etc.). Describe plans for equipment replacements through themaximumtermofthe FranchiseAgreement; Transferandprocessingfacilities; Marketingstrategyandmarketsforrecyclablematerials; The benefits of the proposed service, and potential challenges related to the service and strategiesformanagingsuchchanges;and, Communitieswherethisprogramhasbeensuccessfullyimplementedbyproposerorothers.

Ifinnovativeorcostsavingproposalsarepresentedandresultinadifferentcostthanthebasicservices requestedunderthisRFP,proposershallfollowthecostproposalrequirementsspecifiedinSection3.0 belowandsubmitaseparatesetofcostformsforeachalternativeproposaldescribed. If base service includes innovations that do not change the cost of the service, there is no need to submitaseparatesetofcostandrateforms. TheCityisnotobligatedtoevaluateorselecttheseproposals.Innovativeorcostsavingproposalsmay beconsideredbytheCityifitconcludesthattheywarrantevaluationandanalysis.

3.0

ProposalForms

ProposalForms1through7inAttachment2mustbecompletedtodocumenttheproposersproposed rates,thecostandoperatingbasisforthoserates,andothergeneralinformation. 3.1 GeneralProposalInformation

Each proposer is required to complete Proposal Form 1todocumentthecompanysproposalforthe facilities to be used for disposal, processing, vehicle maintenance, and administration and equipment manufacturersandspecifications. 3.2 OperatingStatistics

Eachproposeristoprovide,onProposalForm2,operationalstatisticssuchasthenumberoffulltime route personnel that will be assigned to service the City, the number of routes and route hours anticipatedtoservicetheCity,andthetonnageofsolidwasteandrecyclablematerialsanticipatedtobe collected in the City. This operational data will provide the City with a basis for evaluating the reasonablenessofeachproposersplans.TheCitywillreviewtheseoperatingstatisticstodetermine thereasonablenessofContractorsproposedlevelofeffort.

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CityofRidgecrest RequestforProposals

3.3

StaffingPlan

Eachproposeristoprovide,onProposalForm3,theirlabor(staffing)plandocumentingthenumberof fulltimeequivalent employees to be assigned to each line of business (e.g. residential solid waste, commercialsolidwaste,residentialrecycling,etc.)aswellasthenumberofemployeestobeassigned toeachadministrativeormanagementposition(e.g.routesupervisors,maintenance,customerservice, etc.).TheCitywillreviewthelaborplantoensuretheadequacyandappropriatenessoftheproposers approach to deploying human resources toward the implementation and operation of the programs andservicesprovidedinresponsetothisRFP. 3.4 EquipmentPlan

Each proposer is to provide, on Proposal Form 4, their equipment (capital) plan documenting the number of vehicles, containers, and other capital expenditures that will be employed in providing services.TheCitywillreviewtheequipmentplantoensuretheadequacyandappropriatenessofthe proposers approach to deploying capital resources toward the implementation and operation of the programs and services provided in response to this RFP. The City does not require the use of new collection vehicles or other equipment, however each proposer should review the equipment performancestandardscontainedintheDraftFranchiseAgreementtoensurethatallvehiclesproposed complywiththoserequirements. 3.5 AnnualOperatingCostEstimate

On Proposal Form 5, each proposer is required to provide its estimated annual cost of operations to servicetheCitylistingcostsseparatelyforlaborrelated,vehiclerelated,processing,disposal,andother costs. The annual operating cost information will provide the City with a basis for evaluating the reasonablenessofeachproposersplansandnegotiatingfuturechangesinthescopeofservice.Note thattheestimatedannualoperatingcostsshallbepresentedincurrentdollars.TheCitywillreviewthe costestimatetoensurethatitisconsistentwiththeoperatingassumptionspresentedinForm2,labor assumptions presented in Form 3, and equipment assumptions presented in Form 4. The annual operating costs identified in Form 5 should not differ from the annual rate revenue projected by the ratesproposedinForms6and7bymorethan$5,000peryear. 3.6 CartandBinRateProposal

On Proposal Form 6, proposers are required to propose rates for collection of carts and bins from commercialandresidentialcustomers.Iftheproposeristheselectedserviceprovider,theseproposed rates will be the companys compensation for providing service to City customers. Note that the proposedcommercialandresidentialratesshallbepresentedfortherateyearcommencingJanuary1, 2012. 3.7 DropBoxandCompactorRateProposal

On Proposal Form 7, proposers are required to propose rates for collection of drop boxes and compactorsintheCity.Iftheproposeristheselectedserviceprovider,theseproposedrateswillbethe companyscompensationforprovidingservicetoCitycustomers.Notethattheproposeddropboxand compactorratesshallbepresentedfortherateyearcommencingJanuary1,2012.

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CityofRidgecrest RequestforProposals

4.0

ExceptionstoFranchiseAgreement

Toprovideproposerswithaclearunderstandingoftheroles,responsibilities,rights,andobligationsof theselectedcontractorandtheCity,aDraftFranchiseAgreementhasbeenincludedasAttachment1to this RFP. Proposers are required to review the Draft Franchise Agreement prior to submittal of proposals to the City. This review process allows proposers to prepare the proposal and costs for serviceswithfullconsiderationoftheirrightsandobligations. The City expects that the Draft Franchise Agreement will be executed by the selected proposer in substantiallythesameformaspresentedinAttachment1.AnyproposedexceptionstotheRFPand/or the proposed terms and conditions of the Draft Franchise Agreement shall be documented in redline/strikeoutformatbytheproposerintheirsubmittalofthecompleteDraftFranchiseAgreement. Foreachexceptionnoted,proposershallprovidealternativelanguagefortheCitysconsideration. TheCityshallreservetherighttodetermineiftheexceptionsarereasonable.Thenumberandnature of the comments will be compared to those noted by the other proposers during the proposal evaluationprocess.IftheCitychoosestoenterintonegotiationswithaproposer,thecommentsnoted and recommended alternative Franchise Agreement language will serve as a starting point for discussion. The proposer will be deemed to have accepted and agreed to any provisions of the RFP and/or proposed terms and conditions of the Draft Franchise Agreement which have not been noted as exceptionsintheproposal.Withthisunderstanding,theselectedproposermaynotinitiatediscussion with the City during negotiations related to Franchise Agreement language for which no exceptions were noted. The City may wish to have the signed Franchise Agreement in hand before City Council makesthefinalcontractorselection.

5.0

ImplementationPlan&Schedule

Eachproposershalldocumentitsoperationalandlogisticalplansandscheduleforaffectingatransition ofserviceswithastartdateofJanuary1,2012.Thisimplementationplanshallincludeeachtasktobe performed,anotationoftasksrequiringCitystaffeffort,andatargetcompletiondateforeachtask.

6.0

AntiCollusionAffidavit

EachproposershallcompleteandsubmittheAntiCollusionAffidavit,Attachment3.

7.0

SecretarysCertificate

EachproposershallcompleteandsubmittheSecretarysCertificate,Attachment4.

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CityofRidgecrest RequestforProposals

Section VI - Proposal Evaluation Criteria


The City intends to convene a panel of evaluators to review the proposals received and make a recommendation to the City Council. The panel will evaluate proposals and, upon completion of the evaluation process, provide a written recommendation to the City Council as to the responsible and qualifiedproposerwhoseproposalprovidescollectionserviceatthelowestcost.Awrittennoticeofthe evaluation panels recommendation shall be provided to all proposers. Proposals will be evaluated basedonvariouscriteriathatmayinclude,butarenotnecessarilylimitedto:

Responsiveness
ComprehensivenessandconsistencyoftheproposalwithrespecttothisRFP. Completenessandaccuracyofallproposalforms. Submittalofaredline/strikeoutversionofthedraftfranchiseagreementwithanyexceptionsnoted andallblanksidentifiedforCompanypopulated. CompliancewiththeRFPandprocurementprocedures. Inclusionofproposalsurety.

ProposersQualifications
Experience Demonstrated experience of proposer and key personnel (those people who are implementingprogramsandprovidingongoingservicestotheCity)providingtherequestedsimilar servicestootherjurisdictions.Iftheproposerisajointventure,demonstratedexperienceofparties workingtogether. Customer Satisfaction Satisfaction of proposers references for services received in the past five years (including, but not limited to, satisfaction with implementation, customer service, billing, paymentoffees,reporting,andthehandlingofcontractualissues). Litigation and Regulatory Action Nature of past and pending civil, legal, regulatory, and criminal actionsandhistoryandnatureofpaymentsofliquidateddamages.

TechnicalProposal
OperationsReasonablenessandreliabilityofproposedserviceprovisionmethods,equipment,and receptacles. Billing and Customer Service Plan Reasonableness of proposed billing and customer service plan andthelevelofserviceprovidedtocustomers. RecyclingPlanReasonablenessandcomprehensivenessoftheproposersplantoperformrecycling andotherdiversionprograms. Public Education and Outreach Plan Reasonableness and comprehensiveness of the proposers plantoprovidepubliceducationandoutreachtothecommunity.

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CityofRidgecrest RequestforProposals

ProposedCost
CostsThereasonableness,accuracy,andconsistencyoftheproposersoperational,labor,capital, cost,andrevenueproposals. Rates Competitiveness of companys proposed rates to customers relative to rates proposed by others.

ExceptionstoDraftFranchiseAgreement
Number and Nature The number and nature of exceptions to the RFP and Draft Franchise Agreement. Likelihood of Prompt and Successful Negotiations The likelihood that the City will be able to promptlyandsuccessfullynegotiatechangestothefranchisewiththeproposer.

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CityofRidgecrest RequestforProposals

RFPDRAFT SOLIDWASTEFRANCHISEAGREEMENT BETWEEN THECITYOFRIDGECREST,CALIFORNIA AND INSERTCONTRACTORSNAME


July1,2011

TABLEOFCONTENTS
ARTICLE 1: GRANT AND ACCEPTANCE OF FRANCHISE ........................................ 6 Section 1.1: Grant and Limitations of Exclusive Franchise ........................................ 6 ARTICLE 2: REPRESENTATIONS AND WARRANTIES OF THE PARTIES ............... 8 Section 2.1: Representations and Warranties ............................................................ 8 ARTICLE 3: TERM OF AGREEMENT.......................................................................... 10 Section 3.1: Term of Agreement .............................................................................. 10 Section 3.2: Citys Option to Extend......................................................................... 10 Section 3.3: Termination for Failure to Implement Services ..................................... 10 ARTICLE 4: SCOPE OF SERVICES ............................................................................ 11 Section 4.1: Residential Services............................................................................. 11 Section 4.2: Commercial Services ........................................................................... 12 Section 4.3: Collection Service Operating Requirements ........................................ 13 Section 4.4: Other Services ..................................................................................... 14 Section 4.5: Standard of Performance ..................................................................... 15 Section 4.6: Collection Locations ............................................................................. 17 Section 4.7: Other Wastes ....................................................................................... 17 Section 4.8: Changes in Scope of Collection Services ............................................ 18 Section 4.9: Billing ................................................................................................... 18 Section 4.10: Transition to Next Contractor at End of Agreement ........................... 19 ARTICLE 5: PROCESSING AND TRANSFER ............................................................ 20 Section 5.1: Processing and Transfer Arrangements............................................... 20 Section 5.2: Recyclable Materials Marketing ........................................................... 20 Section 5.3: Title to Recovered Materials ................................................................ 20 ARTICLE 6: SOLID WASTE DISPOSAL ..................................................................... 21 Section 6.1: Solid Waste Disposal ........................................................................... 21 Section 6.2: Gate Fees ............................................................................................ 21 Section 6.3: Bin Fees ............................................................................................... 22 ARTICLE 7: RECYCLING PROGRAMS ...................................................................... 23 Section 7.1: The Contractor's Responsibility for Implementation ............................. 23 Section 7.2: Recycling Plan ..................................................................................... 23 Section 7.3: Public Awareness ................................................................................ 23 Section 7.4: Termination for Failure to Implement Strategies .................................. 24 ARTICLE 8: OPERATING ASSETS ............................................................................. 25 Section 8.1: Operating Assets ................................................................................. 25 Section 8.2: Operation and Maintenance of the Operating Assets .......................... 26 Section 8.3: Containers............................................................................................ 26
1 TheCityofRidgecrest FranchiseAgreement

Section 8.4: Vehicle Requirements .......................................................................... 27 ARTICLE 9: GENERAL REQUIREMENTS .................................................................. 28 Section 9.1: Public Access to the Contractor ........................................................... 28 Section 9.2: Service Complaints .............................................................................. 28 Section 9.3: Accounting and Records ...................................................................... 28 Section 9.4: Reporting ............................................................................................. 29 Section 9.5: Integrated Waste Management Act (AB 939) Compliance ................... 29 Section 9.6: Personnel and Subcontractors ............................................................. 30 Section 9.7: City Contract Manager ......................................................................... 30 ARTICLE 10: CITY FEES ............................................................................................. 32 Section 10.1: City Fees ............................................................................................ 32 Section 10.2: Adjustment to Fees ............................................................................ 32 Section 10.3: Payment Schedule and Late Fees ..................................................... 32 ARTICLE 11: CONTRACTORS COMPENSATION AND RATE SETTING ................. 34 Section 11.1: General .............................................................................................. 34 Section 11.2: Rates and Annual Adjustments .......................................................... 34 Section 11.3: Extraordinary Rate Adjustments ........................................................ 35 Section 11.4: Publication of Rates ........................................................................... 36 ARTICLE 12: INDEMNITY, INSURANCE, AND PERFORMANCE BOND .................. 37 Section 12.1: Indemnification ................................................................................... 37 Section 12.2: Insurance ........................................................................................... 38 Section 12.3: Performance Bond ............................................................................. 40 ARTICLE 13: DEFAULT, REMEDIES AND TERMINATION ........................................ 41 Section 13.1: Default and Remedies........................................................................ 41 Section 13.2: Liquidated Damages .......................................................................... 42 Section 13.3: Uncontrollable Circumstances ........................................................... 44 Section 13.4: Right to Demand Assurances of Performance ................................... 45 Section 13.5: Waiver of Defenses ............................................................................ 45 ARTICLE 14: RESOLUTION OF DISPUTES ............................................................... 46 ARTICLE 15: MISCELLANEOUS PROVISIONS ......................................................... 47 Section 15.1: Relationship of the Parties ................................................................. 47 Section 15.2: Notice to Parties ................................................................................. 47 Section 15.3: Actions of the City in its Governmental Capacity ............................... 47 Section 15.4: Binding Effect ..................................................................................... 48 Section 15.5: Amendments ...................................................................................... 48 Section 15.6: Further Assurance ............................................................................. 48 Section 15.7: Assignment and Transfer of Agreement............................................. 48 Section 15.8: Interpretation ...................................................................................... 49 Section 15.9:Jurisdiction .......................................................................................... 51 Section 15.10: Entire Agreement ............................................................................. 51
2 TheCityofRidgecrest FranchiseAgreement

List of Exhibits
A.Definitions B.RateAdjustmentMethodology B1.MultiIndexRateAdjustmentMethodology B2.CostBasedRateAdjustmentMethodology C.ContractorsProposal{Tobeprovidedbyselectedcontractor.} C1.TechnicalProposal C2.CostBasisforProposal C3.InitialRatesforCollectionServices C4.ImplementationPlanandSchedule C5.PublicEducationandOutreachPlan C6.ContractorsRecyclingPlan C7.ApprovedSubcontractors D.ReportingRequirements E.PerformanceBond{Tobeprovidedbyselectedcontractor.} E.CitysSourceReductionandRecyclingElement F.CalRecycle/CityofRidgecrestComplianceOrder G.CityServiceLocations

TheCityofRidgecrest FranchiseAgreement

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37

SOLIDWASTEFRANCHISEAGREEMENT
This Solid Waste Franchise Agreement (the "Agreement") is entered into on the ____ day of _________,2011,byandbetweentheCityofRidgecrest(hereinafter,the"City"),and{InsertContractor Name}(hereinafter,the"Contractor")(together,the"Parties").

RECITALS
WHEREAS,theLegislature oftheState ofCalifornia,byenactmentoftheCaliforniaIntegrated WasteManagementActof1989("AB939")andsubsequentmodificationsthereto,establishedaSolid Waste management process which requires cities and other local jurisdictions to implement source reduction,reuseandRecyclingasintegratedwastemanagementpractices;and WHEREAS,AB939authorizesandrequireslocalagenciestomakeadequateprovisionsforSolid Wastehandlingwithintheirjurisdictions;and WHEREAS, Section 40059 of the State Public Resources Code provides that the City may determine aspects of Solid Waste handling which are of local concern, including, but not limited to, frequencyofCollection,meansofCollectionandTransportation,levelofservices,chargesandfeesand nature,location,andextentofprovidingSolidWastehandlingservicesandwhethertheservicesareto beprovidedbymeansofpartiallyexclusiveorwhollyexclusiveAgreements,contracts,licenses,permits orotherwise;and WHEREAS, the City is obligated to protect the public health and safety of the residents of the CityandarrangementsbywastehaulersfortheCollectionofSolidWasteshouldbemadeinamanner consistentwiththeprotectionofpublichealthandsafety;and WHEREAS,theCityhasenteredintoacomplianceplanwithCalRecycleinordertocomeintofull compliance with AB939 and the Parties understand that the implementation of and continued compliance with that plan and the Citys Source Reduction and Recycling Element (SRRE) will become theprimaryresponsibilityoftheContractor;and WHEREAS,theCityandtheContractoraremindfuloftheprovisionsofthelawsgoverningthe safe Collection, Transport, Recycling, and Disposal of Solid Waste, including AB 939 and the Resource ConservationandRecoveryAct42U.S.C.9601etseq.;and WHEREAS,theCityCouncildeterminesandfindsthatthepublicinterest,health,safetyandwell being would be served if the Contractor performs these services for Residential and Commercial Customers;and WHEREAS, in accordance with Section 40059 of the State Public Resources Code, the City Council is empowered to enter into agreements with any Person or corporation and to prescribe the termsandconditionsofsuchagreements;and WHEREAS,theCityCouncilhasselectedContractorthroughacompetitiveprocurementprocess andhasauthorizedtheexecutionofthisAgreementon{InsertDatefollowingCouncilaction};and WHEREAS, neither the City nor Contractor could anticipate all of the possible needs, considerations,oreventualitiesthatmayariseduringtheTermofthisAgreementandthePartiesagree 4 TheCityofRidgecrest FranchiseAgreement

38 39 40 41

that they will work together in a spirit of mutual cooperation to resolve any such issues as and when theyarise; NOW THEREFORE, in consideration of the respective and mutual covenants and promises herein,andsubjecttoallthetermsandconditionshereof,thePartiesagreeasfollows:

TheCityofRidgecrest FranchiseAgreement

42

ARTICLE 1: GRANT AND ACCEPTANCE OF FRANCHISE


Section 1.1: Grant and Limitations of Exclusive Franchise
By the signing of this Agreement, the City grants to Contractor and Contractor accepts an exclusive franchise within the corporate limits of the City. Subject to Municipal Code Section ___, the franchise grantedtoContractorshallbeforthescopeofservicesdescribedinArticle4ofthisAgreement,subject tothelimitationsdescribedbelowinSection1.1.AandexceptwhereotherwiseprecludedbyFederal, State,andlocallawsandregulations. A. LimitationstoExclusivity.TheawardofthisAgreementshallnotprecludethecategoriesofSolid Waste and Recyclable Materials listed below from being delivered to and Collected and Transported by others provided that nothing in this Agreement is intended to or shall be construedtoexcuseanyPersonfromobtaininganyauthorizationfromtheCitywhichisotherwise requiredbylaw: 1. Recyclable Materials. Other Persons shall maintain the right to accept donated Recyclable MaterialsandtopaytheservicerecipientforRecyclableMaterialssolongasthereisnonet paymentmadebytheservicerecipienttosuchotherPerson; SelfHauled Materials. A Commercial business Owner or Resident may Dispose of Solid Waste and Recyclable Materials generated in or on their own Premises with their own vehicle; Donated Materials. Any items which are donated by the Generator to youth, civic, or charitableorganizations; Beverage Containers. Containers delivered for Recycling under the California Beverage Container Recycling and Litter Reduction Act, Section 14500, et seq. California Public ResourcesCode; Materials Removed by Customers Contractor as Incidental Part of Services. Solid Waste and/or Recyclable Materials removed from a Premises by a contractor (e.g., gardener, landscaper,treetrimmingservice,constructioncontractor,Residentialcleanoutservice)as anincidentalpartoftheservicebeingperformedandsuchcontractorisprovidingaservice whichisnotincludedinthescopeofthisAgreement; Animal, Grease Waste, and Used Cooking Oil. Animal waste and remains from slaughterhouseorbutchershops,grease,orusedcookingoil; SewageTreatmentByProduct.Byproductsofsewagetreatment,includingsludge,sludge ash,grit,andscreenings; ExcludedWaste.ExcludedWasteregardlessofitssource;and,

43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74

2.

3.

4.

5.

6.

7.

8.

TheCityofRidgecrest FranchiseAgreement

75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96

9.

MaterialsGeneratedbyState,County,andFederalFacilities.MaterialsgeneratedbyState, County,andFederalfacilitieslocatedintheCityprovidedthattheGeneratorhasarranged serviceswithotherPersonsorhasarrangedserviceswiththeContractorthroughaseparate agreement.

ContractoracknowledgesandagreesthattheCitymaypermitotherPersonsbesidestheContractorto Collect any and all types of materials excluded from the scope of this Franchise, as set forth above, without seeking or obtaining approval of Contractor. If Contractor can produce evidence that other Persons are servicing Collection Containers or are Collecting and Transporting Solid Waste and/or Recyclable Materials (collectively Franchised Materials) in a manner that is not consistent with this AgreementortheCitysMunicipalCode,itshallreportthelocation,thenameandphonenumberofthe Person or company to the City Contract Manager along with Contractors evidence. In such case, the CitymaynotifytheGeneratorandPersonprovidingserviceofContractorsrightsunderthisAgreement. This Agreement and scope of this franchise shall be interpreted to be consistent with Applicable Law, nowandduringtheTermoftheAgreement.Iffuturejudicialinterpretationsofcurrentlawornewlaws, regulations, or judicial interpretations limit the ability of the City to lawfully contract for the scope of services in the manner and consistent with all provisions as specifically set forth herein, Contractor agrees that the scope of the Agreement will be limited to those services and materials which may be lawfully included herein and that the Agency shall not be responsible for any lost profits or losses claimedbyContractortoariseoutoflimitationstothescopeorprovisionsoftheAgreementsetforth herein.Insuchanevent,itshallbetheresponsibilityofContractortominimizethefinancialimpactof suchfuturejudicialinterpretationsornewlawsandtheContractormaymeetandconferwithAgency andmaypetitionforaRateadjustmentpursuanttoSection8.3.

TheCityofRidgecrest FranchiseAgreement

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ARTICLE 2: REPRESENTATIONS AND WARRANTIES OF THE PARTIES


Section 2.1: Representations and Warranties
TheParties,byacceptanceofthisAgreement,representandwarrantthat: A. Existence and Powers. The Parties are duly organized and validly existing under the laws of the State of California, with full legal right, power, and authority to enter into and perform their obligationsunderthisAgreement. Due Authorization and Binding Obligation. The Parties have duly authorized the execution and deliveryofthisAgreement.ThisAgreementhasbeendulyexecutedanddeliveredandconstitutes thelegal,valid,andbindingobligationoftheParties,enforceableagainstthePartiesinaccordance with its terms, except insofar as such enforcement may be affected by bankruptcy, insolvency, moratorium,andotherlawsaffectingcreditors'rightsgenerally. NoConflict.Neithertheexecution,northeperformancebythePartiesoftheirobligationsunder this Agreement: (1) conflicts with, violates, or results in a breach of any law or governmental regulationsapplicabletoeitherParty;or,(2)conflictswith,violates,orresultsinabreachofany term or condition of any judgment, decree, franchise, agreement (including, without limitation, thecertificateofincorporationoftheContractor),orinstrumenttowhichtheContractororany AffiliateisapartyorbywhichtheContractororanyAffiliateoranyoftheirpropertiesorassets arebound,orconstitutesadefaultunderanysuchjudgment,decree,agreement,orinstrument. ThePartieshavereadandareawareoftheprovisionsofSection1090etseq.andSection87100 etseq.oftheCaliforniaGovernmentCoderelatingtoconflictsofinterestforpublicofficersand employees.Contractorrepresentsitisunawareofanyfinancialoreconomicinterestofanypublic officeroremployeeoftheCityrelatingtothisAgreement. NoLitigation.Thereisnoaction,suit,orotherproceedingasoftheAgreementDate,atlaworin equity, before or by any court or governmental authority, pending, or to the Parties best knowledge,threatenedagainsttheeitherPartywhichislikelytoresultinanunfavorabledecision, ruling,orfindingwhichwouldmateriallyandadverselyaffectthevalidityorenforceabilityofthis AgreementoranysuchagreementorinstrumententeredintobyeitherPartyinconnectionwith the transactions contemplated hereby, or which would materially and adversely affect the performancebythatPartyofitsobligationshereunderorbytheContractorunderanysuchother agreementorinstrument. No Legal Prohibition. The Parties have no knowledge of any Applicable Law in effect on the AgreementDatewhichwouldprohibittheperformancebyeitherPartyofthisAgreementandthe transactionscontemplatedhereby. Contractors Statements. The Contractors Proposal and any other supplementary information submittedtotheCity,whichtheCityhasreliedoninawardingandenteringthisAgreement,do not:(i)containanyuntruestatementofamaterialfact,or(ii)omittostateamaterialfactthatis 8 TheCityofRidgecrest FranchiseAgreement

99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133

B.

C.

D.

E.

F.

134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 G.

necessaryinordertomakethestatementsmade,inlightofthecircumstancesinwhichtheywere made,notmisleading. ContractorsInvestigation.Contractorhasmadeanindependentinvestigation(satisfactorytoit) of the conditions and circumstances surrounding the Agreement and the work to be performed hereunder. ContractorhastakensuchmattersintoconsiderationinenteringthisAgreement to provide services in exchange for the compensation provided for under the terms of this Agreement. Ability to Perform. Contractor possesses the business, professional, and technical expertise to manage,Collect,Transport,andDisposeoftheSolidWasteandtomanage,Collect,Transport,and Process Recyclable Materials and Compostable Materials; and Contractor possesses the equipment,facility,andemployeeresourcesrequiredtoperformthisAgreement. VoluntaryUseofDesignatedDisposalFacility.TheContractor,withoutconstraintandasafree freemarketbusinessdecisioninacceptingthisAgreement,agreestousetheApprovedDisposal LocationforthepurposesofDisposingofallSolidWasteCollectedintheCity.Suchdecisionby ContractorinnowayconstitutesarestraintoftradenotwithstandinganyChangeinLawregarding flowcontrollimitationsoranydefinitionthereof.

H.

I.

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ARTICLE 3: TERM OF AGREEMENT


Section 3.1: Term of Agreement
TheTermofthisAgreementisfromtheAgreementDateofJanuary1,2012throughDecember31,2019 and shall continue in full force for a period of seven (7) years, unless earlier terminated pursuant to Section 3.3 hereof. The Agreement may be extended in accordance with this Section or terminated pursuanttoArticle13.

151 152 153 154 155

156 157 158 159 160 161

Section 3.2: Citys Option to Extend


AttheCitys solediscretion,thisAgreementmaybeextendedwithoutamendmentforaperiodofno lessthanone(1)yearandnomorethanfive(5)additionalyearsforatotalTermthatdoesnotexceed twelve(12)years.IftheCitydesirestoextendtheAgreement,theCityshallprovidetheContractorwith writtennoticeofitsdecisiontoextendtheAgreementatleastonehundredeighty(180)daysbeforethe expirationoftheTerm.SuchnoticebytheCityshallspecifythedurationoftheextension.

162 163 164 165 166

Section 3.3: Termination for Failure to Implement Services


The Contractor has agreed herein, through either its own labor, equipment, and facilities or facilities providedbyothers,toimplementvariousprogramsinordertoexpandthetypesofservicesprovidedto theCity.FailuretoimplementtheservicesdescribedinthisAgreementuponthecommencementofthis Agreementforanyreason,shallconstituteanEventofDefaultinaccordancewithSection13.1hereof.

10

TheCityofRidgecrest FranchiseAgreement

167 168 169 170 171 172 173

ARTICLE 4: SCOPE OF SERVICES


Contractor shall perform the Services described in this Article 4. This Article 4 describes the requirementsfortheservicestobeprovidedincludingthetypesandsizesofContainerstobeprovided by Contractor, available Service Levels and frequencies, acceptable and prohibited materials, and any additionalservicestobe provided to Customerswhosubscribe tothatprogram.Failure tospecifically requireanactnecessarytoperformtheservicedoesnotrelieveContractorofitsobligationtoperform suchact.

174 175 176 177 178 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193

Section 4.1: Residential Services


ContractorshallprovidetheservicesdescribedinthisSection4.1toanyResidentialCustomerwithinthe City who subscribes with Contractor for such service. The Residential sector includes MultipleUnit Dwellingswithfour(4)orlessunits. A. SolidWasteCollection.ContractorshallCollectSolidWasteinContractorprovidedCartsone(1) time per week from Residential Customers and Transport all Solid Waste to the Designated DisposalFacilityforDisposal. Containers: ContainerSizes: ServiceFrequency: ServiceLocation: AcceptableMaterials: ProhibitedMaterials: AdditionalService: Carts 96gallons(orsimilarsize)standard;64gallons(orsimilarsize)for seniorsand/ordisabledcustomers One(1)timeperweek Curbside SolidWaste RecyclableMaterials,ExcludedWaste Contractor shall provide additional Solid Waste Carts to SingleUnit DwellingCustomersuponrequestandmaychargetheAdditionalSolid WasteCartRateapprovedbytheCity.

B.

Recyclable Materials Collection. Contractor shall Collect Recyclable Materials in Contractor providedContainersone(1)timeeveryotherweekfromResidentialCustomersandTransportall RecyclableMaterialstotheApprovedRecyclableMaterialsProcessingFacilityforProcessing.

195 196 197 198 199 200 201 202 203

Containers: ContainerSizes: ServiceFrequency: ServiceLocation: AcceptableMaterials: ProhibitedMaterials: AdditionalService:

Carts 96gallons One(1)timeeveryotherweek Curbside RecyclableMaterials SolidWaste,ExcludedWaste ContractorshallprovideadditionalRecyclableMaterialsCartstoSingle UnitDwellingCustomersuponrequestandmaychargetheAdditional RecyclingCartRateapprovedbytheCity.

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204 205 206 207 208 209 210 211 212 213 214 215 216 217 218 219 220 221 222 223 224 225 226 227 228 229 230 231 232 233 234 235 236 237 238 239 240 241 242 243 244 245

Section 4.2: Commercial Services


ContractorshallprovidetheservicesdescribedinthisSection4.2toanyCommercialCustomerwithin theCitywhosubscribeswithContractorforsuchservice.TheCommercialsectorincludesMultipleUnit Dwellingswithfive(5)ormoreunits. A. SolidWasteCollection.ContractorshallCollectSolidWasteinContractorprovidedContainersnot lessthanone(1)timeperweekfromCommercialCustomersandTransportallSolidWastetothe DesignatedDisposalFacilityforDisposal. Containers: ContainerSizes: Carts,Bins,DropBoxes,Compactors 96gallonCarts; 1.5,3,and6cubicyardBins;and, DropBoxesorCompactors(asrequestedbyCustomer) Uptofive(5)timesperweekbutnotlessthanone(1)timeperweek,as requestedbyCustomer Curbside; or other Customerselected service location at the Commercial Premises (push/pull charges may apply if Container is not immediatelyaccessiblebytheCollectionVehicle). SolidWaste RecyclableMaterials,ExcludedWaste Upon Customer request and to accommodate periodic additional service needs, Contractor shall provide Collection service at a greater frequency than the Customers regularly scheduled service, up to the maximum Service Frequency and Contractor may charge the appropriateRateforthehigherServiceFrequency. Contractor shall, at Customers request and for an additional charge, open and close gates, push and/or pull Containers, lock and unlock Containers,orperformotherservicesasreasonablynecessarytoaccess andemptyContainers.

ServiceFrequency: ServiceLocation:

AcceptableMaterials: ProhibitedMaterials: AdditionalService:

OtherRequirements:

B.

Recyclable Materials Collection. Contractor shall Collect Recyclable Materials in Contractor providedContainersnotlessthanone(1)timeeveryotherweekfromCommercialCustomersand Transport all Recyclable Materials to the Approved Recyclable Materials Processing Facility for Processing. Containers: ContainerSizes: ServiceFrequency: ServiceLocation: Carts,DropBoxes,Compactors 96gallonCarts; 1.5,3,and6cubicyardBins;and, DropBoxesorCompactors(asrequestedbyCustomer) Uptoone(1)timeperweekbutnotlessthanone(1)timeeveryother week,asrequestedbyCustomer CurbsideorotherCustomerselectedservicelocationattheCommercial Premises(push/pullchargesmayapplyifContainer isnotimmediately accessiblebytheCollectionVehicle). RecyclableMaterials SolidWaste,ExcludedWaste

AcceptableMaterials: ProhibitedMaterials:

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AdditionalService:

OtherRequirements:

Upon Customer request and to accommodate periodic additional service needs, Contractor shall provide Collection service at a greater frequency than the Customers regularly scheduled service, up to the maximum Service Level and Contractor may charge the appropriate RateforthehigherServiceLevel. Contractor shall, at Customers request and for an additional charge, open and close gates, push and/or pull Containers, lock and unlock Containers,orperformotherservicesasreasonablynecessarytoaccess andemptyContainers.

Section 4.3: Collection Service Operating Requirements


A. RegularHoursofService.TheContractorshallschedulenoCollectionsfromanyPremisesonany dayearlierthan6:00a.m.orlaterthan6:00p.m.provided,however,thattheCitymay,atitssole discretion, change the Collection time as required by the needs of the Customers or the Contractor. Emergency Service. Collections of Solid Waste necessitated by an emergency, which the City ContractManagerdeterminesthreatensthepublichealthandsafetywithintheCitywillbemade bytheContractoratthedirectionoftheCityContractManager.SuchEmergencyServicesmaybe requiredoutsideoftheregularCollectionhoursandschedule.IftheCityrequeststheContractor toprovideEmergencyServices,theContractorwillusetheContractor'sgoodfaithbesteffortsto respond to such a request. The City shall reimburse the Contractor for all documented and reasonablecostsincurredinordertocomplywiththeprovisionsofthisSection. NoiseLevels.TheContractorshallperformtheCollectionServicesinamannerthatminimizesthe noise resulting from its equipment and personnel and shall ensure that it is in compliance with ApplicableLawandtheCitysMunicipalCode. Holidays.CollectionofSolidWasteandRecyclableMaterialsshallnotberequiredonthefollowing legal holidays: New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day, except in case of emergency or as otherwise required by the City Contract Manager.WheneveraregularCollectionfallsonsuchaholiday,theCollectionshallbemadeon the following working day, and Collections throughout the City shall become current within one (1) week thereafter. Written notice of this policy shall be provided to Customers no more than thirty(30)dayspriortosuchalternativeserviceday.Collectionshallnotberescheduledwhenthe holidayfallsonaSaturdayorSunday,unlessotherwiseagreedtobytheCityandtheContractor. Preservation of Public Health and Safety. The Contractor shall at all times operate in such a mannerastoprotectthepublichealthandsafety.TheContractoragreestoestablishprocedures andeducateitsemployeesastosuchproceduresregardingpropermethodsfortheprotectionof the general public, including, but not limited to, arranging for the proper and legal Disposal of hazardoussubstancesencounteredduringitsperformanceunderthisAgreement.

B.

C.

D.

E.

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Section 4.4: Other Services


A. BulkyWasteCollection.ContractorshallofferBulkyWasteCollectionServicestoResidentialand Commercial Customers on an oncall basis up to three (3) times per year (as requested by Customer) within five (5) Business Days after the Customerrequested service date at no additionalchargetoCustomers.Contractorshallofferadditionalservicelevelsandfrequenciesto Customers upon request for an additional charge. Contractor shall make reasonable efforts to scheduleoncallBulkyWasteCollectionsonadaythatisconvenienttotheCustomer. Contractor shall Collect Bulky Waste from Customers and Transport the Bulky Waste to the DesignatedDisposalFacility. Containers: ServiceLevel: ServiceFrequency: ServiceLocation: AcceptableMaterials: ProhibitedMaterials: AdditionalService: Notapplicable Uptothree(3)cubicyardsofSolidWaste,RecyclableMaterials,andE WasteORuptoone(1)ApplianceorBulkyWasteItem Uptothree(3)timesperyear(asrequestedbyCustomer) Curbside SolidWaste,RecyclableMaterials,BulkyWaste,EWaste,andUWaste ExcludedWasteoranysingleitemthatexceedstwohundred(200)lbs. inweight Contractor shall Collect additional items that exceed the above described service level and may charge the Additional Bulky Waste ItemRateapprovedbytheCity(asrequestedbyCustomer). ContractorshallprovideadditionalCollectioneventsfora Customerbeyondthree(3)peryearandmaychargetheAdditional BulkyWasteItemCollectionRateapprovedbytheCity. TheContractorshallprovidetheservicetotheCustomerwithinfive(5) Business Days of the Customers requested service date, as mutually agreeduponbytheCustomerandContractor.

OtherRequirements:

B.

CityFacilitiesandEvents.ContractorshallCollectSolidWasteandRecyclableMaterialsfromCity facilitiesinthesamemannerasthoseservicesareprovidedtoCommercialCustomers.Contractor shallprovideservicetoallCityfacilitiesidentifiedinExhibitGaswellasanyfuturefacilitiesowned andoperatedbytheCity.ContractorshallprovideSolidWasteandRecyclableMaterialsservices to Citysponsored public event held within the City to include, at a minimum, Carts for the collectionofbothSolidWasteandRecyclableMaterialsandstaffingsufficienttoensurethatsuch Cartsareservicedfrequentlyenoughtopreventoverflowingorspillage.Contractorshallprovide theseservicesatnocosttotheCityorCustomers. Christmas Trees. The Contractor shall Collect all Christmas trees properly placed curbside by ResidentialPremisesonthefirsttwo(2)regularlyscheduledCollectiondaysafterChristmasDay, or such other days as agreed by the City Contract Manager and the Contractor, free of any additionalchargetoanyCustomer. SpecialServices.TheContractorshallhavetheright,butnottheobligation,toprovideadditional Special Services requested by any Customer which are directly related or ancillary to any of the otherCollectionServicesauthorizedhereunder.ThenatureandtermsofanysuchSpecialServices shall be negotiated with the Customer and compensation therefore shall be paid by the 14 TheCityofRidgecrest FranchiseAgreement

C.

D.

325 326 327 328 329 330 331 332 333 334 335 336 337 338 339 340 341 342 343 344 345 346 347 348 349 F. E.

requestingCustomeratRatesapprovedbytheCity.IntheeventthattheCitydeterminesthatthe Rates set by the Contractor for such Special Services are inappropriate, the Contractor shall providetheCitywithinformationsupportingthelevelofRateproposedbytheContractor.Upon receiptandreviewofsuchinformation,theCitymaysettheRate,whichshallbecomebindingon the Contractor. {Proposer Please include any rates for special services (e.g. push/pull, lock/unlock,backyard/sideyard,etc.)whichcanbereasonablyanticipatedinyourrateproposalso thatsuchratescanbeapprovedinadvance.} IllegalDumping.PursuanttoSection___oftheMunicipalCode,theContractorshall,atalltimes, take reasonable measures to keep the roads and streets in the City free from litter from the operations of its Operating Assets. In addition, within the City, the Contractor shall, without chargetotheCityorCustomers: 1. Cleanupthree(3)cubicyardsorlesspereventofnonHazardousWastefrompublicareas, uponrequestbyCity; Cleanup three (3) Bulky Waste Items or less per event of unquestionably discarded Bulky WastefrompublicroadwaysoralleyswhenobservedbyContractorspersonnel;and, ProvideContainersandCollectionserviceforcleanupbyCityprovidedlaborcrewsandCity coordinatedvolunteercleanupsofoverthree(3)cubicyardsofillegallydumpedwaste.

2.

3.

Contractor shall work with the County to deliver such illegally dumped waste at the Designated DisposalFacilityatnoadditionalchargetotheCityorContractor.IntheeventthattheDesignated Disposal Facility is required to charge for the receipt of such materials, the City and Contractor shall meet and confer regarding the cost of Disposal of material related to this program and ContractorshallberelievedofitsrequirementtoDisposeofthismaterialuntilarrangementscan bemadeforpaymentofsuchcharges. Public Education and Outreach. The Contractor shall perform all public education and outreach activitiesasdescribedinitsPublicEducationandOutreachPlaninExhibitC5.

350 351 352 353 354 355 356 357 358 359 360 361

Section 4.5: Standard of Performance


ContractorshallatalltimescomplywithApplicableLawsandprovideservicesinamannerthatissafeto thepublicandtheContractorsemployees.Excepttotheextentthatahigherperformancestandardis specified in this Agreement, Contractor shall perform services in accordance with Solid Waste and RecyclableMaterialsmanagementpracticescommontoCalifornia. A. Clean Up: Avoiding Damage to Property. The Contractor shall use due care to prevent spills or leaksofmaterialplacedforCollection.IfanymaterialsarespilledorleakedduringCollectionor Transportation,theContractorshallcleanupallspillsorleaksbeforeleavingthesiteofthespill. TheContractorshallcloseallgatesaftermakingCollectionsandshallnotdodamagetoortrespass uponprivateorpublicproperty. Hazardous Waste. The Contractor acknowledges its obligation to arrange for the Disposal of HazardousWastethatinadvertentlycomesintoitspossessionorcontrol.TheContractoragreesto 15 TheCityofRidgecrest FranchiseAgreement

B.

362 363 364 365 366 367 368 369 370 371 372 373 374 375 376 377 378 379 380 381 382 383 384 385 386 387 388 389 390 391 392 393 394 395 396 397 398 399 400 D. C.

establishallreasonablepracticesforthescreeningandeliminationofHazardousWastefromthe waste stream including, but not limited to, the training of personnel and the revision of such practices as necessary to reflect prudent waste screening considered to be good practice in the SolidWasteCollectionandDisposalindustryatthetime. IftheContractorfindswhatreasonablyappearstobediscardedHazardousWasteorHousehold HazardousWasteataDesignatedCollectionLocation,theContractor,inadditiontotheprocedure outlinedinthepreviousparagraph,shalleither: 1. Notify the Owner or Generator, if such can be determined, that the Contractor may not lawfullyCollectsuchwasteandleaveatagspecifyingthenearestlocationavailableforsuch appropriateDisposal;or, FollowsuchotherprocedureastheCityContractManagershallapprove.

2.

Intheeventofathreattothepublichealthandsafety,theContractorshallimmediatelycontact thelocalfiredepartment.TheContractorshallnotifytheCityContractManagerofsuchincident withinone(1)day. Employees: 1. Uniform. The Contractor shall take all steps necessary to ensure that its employees performing Collection Services conduct themselves in a safe, proper, and workmanlike manner,andthattheyworkasquietlyaspossible.Allsuchemployeesshallatalltimesof employmentbedressedinuniformswithsuitableidentification. DriverQualifications.Alldriversmusthaveineffectavalidlicense,oftheappropriateclass, issued by the California Department of Motor Vehicles. Contractor shall use the Class II California Department of Motor Vehicles employer Pull Notice Program to monitor its driversforsafety. SafetyTraining.Contractorshallprovidesuitableoperationalandsafetytrainingforallof its employees who operate Collection Vehicles or equipment. Contractor shall train its employeesinvolvedinCollectiontoidentify,andnottoCollect,ExcludedWaste.Uponthe City Contract Managers request, Contractor shall provide a copy of its safety policy and safetytrainingprogram,thenameofitssafetyofficer,andthefrequencyofitstrainings.

2.

3.

Improper Loading of Containers. The Contractor may decline to Collect any Solid Waste and RecyclableMaterialsthatbeenloadedorleftforCollectioninanymannerwhichwouldprohibitits safeCollection. RecordofNonCollection.WhenanySolidWasteandRecyclableMaterialsplacedforCollection arenotCollectedby the Contractor,theContractorshallleaveataglistingthereasonsforsuch nonCollectionandatelephonenumberatwhichtheCustomermaycontacttheContractor.This informationshalleitherbeinwritingorbymeansofacheckedboxonaform.TheContractorshall maintain,atitsplaceofbusiness,alogbooklisting allsuch circumstancesin whichCollectionis denied. The log book shall contain the names and/or addresses of the Collection Premises involved, the date of such tagging, the reason for nonCollection, and the date and manner of dispositionofeachcase.Thelogbookshallbekeptsothatitmaybeconvenientlyinspectedby 16 TheCityofRidgecrest FranchiseAgreement

E.

401 402 403 404 405 406 407 408 409 410 411 412 413 414 415 416 417 418 419 F.

the City Contract Manager upon request. The log relating to any particular tagging shall be retainedforaperiodofone(1)yearfollowingsuchtagging. Fees and Gratuities. The Contractor shall not, nor shall it permit any agent, employee, or Subcontractor employed by it, to request, solicit, or demand, either directly or indirectly, any compensation for the Collection of Solid Waste and Recyclable Materials or other Collection Services,exceptsuchcompensationasisspecificallyprovidedforhereinasapprovedbytheCity. CompliancewithApplicableLaw.TheContractorshallcomplywithallApplicableLawrelatingto any aspect of the Collection Services or this Agreement, shall obtain and maintain all legal entitlementsrequiredfortheOperatingAssetsandtheCollectionServices,shallcomplywithall valid acts, rules, regulations, orders, and directions of any Governmental Body applicable to the Operating Assets and the Collection Services provided hereunder, and shall pay all taxes in connectiontherewith.TheContractorshallkeepallrecordsindicatingcompliancerequiredbythe FederalImmigrationandControlActof1986andshallmakesuchrecordsavailableforinspection bytheCityContractManageruponrequest. TaxesandUtilityCharges.TheContractorshallpayalltaxeslawfullyleviedorassesseduponorin respectoftheOperatingAssetsortheCollectionServices,oruponanypartthereoforuponany revenuesoftheContractortherefrom,andshallprovideandpaythecostofallutilitiesnecessary fortheoperationoftheOperatingAssetsandtheprovisionoftheCollectionServices,whenthe sameshallbecomedue.

G.

H.

420 421 422 423 424 425 426 427 428 429 430 431 432 433 434

Section 4.6: Collection Locations


A. General.TheContractorshallberesponsiblefortheCollectionofallSolidWasteandRecyclable MaterialsplacedforCollectioninalegalmanner.TheContractorshallimmediatelynotifytheCity ContractManagerofanyconditionatornearanyDesignatedCollectionLocationwhichcreatesa safety hazard or accessibility problem. Upon authorization by the City Contract Manager, the ContractorshalldiscontinueCollectionforanysuchlocationuntilthesafetyhazardoraccessibility problemiscorrected. Enclosures.WheretheDesignatedCollectionLocationiswithinanenclosureconstructedpursuant to the requirements of any public agency having jurisdiction over the design, construction, and locationofsuchenclosures,theContractorshallberesponsiblefortheremovalandreplacement of all Containers placed therein. The Contractor shall use sufficient care in the handling of such Containers so as to prevent any damage to the enclosure, the enclosure doors, and adjacent facilities or improvements. The Contractor shall promptly repair at its own expense any such enclosureoradjacentfacilitiesorimprovementsdamagedbytheContractor.TheCityshallresolve anydisputesrelatingtosuchdamage,andtheContractoragreestoabidebysuchdecision.

B.

435 436 437 438

Section 4.7: Other Wastes


ThePartiesacknowledgethatthisAgreementisgrantedonlywithrespecttotheCollectionServicesand does not include the Collection, Transportation, Processing, or Disposal of Hazardous Waste, Medical Waste,andLiquidWaste.IftheContractorelectstoprovideanysuchserviceswithrespecttoHazardous 17 TheCityofRidgecrest FranchiseAgreement

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Waste,InfectiousWaste,oranyotherwasteregulatedbytheDepartmentofToxicSubstancesControl, suchservicesshallbeperformedbyaseparatelegalentityseparatelyinsuredandliable,andaccording toApplicableLaw.ThePartiesfurtheracknowledgethattheprovisionbytheContractorofanyservices notspecificallyincludedwithintheAgreementareexcludedfromtheprotectionofthisAgreementand maybethesubjectofcompetitionamonganyandalllegallyauthorizedhaulers.

444 445 446 447 448 449 450 451 452 453

Section 4.8: Changes in Scope of Collection Services


PursuanttoMunicipalCodeSection_______,theCitymaymodifythescopeofservicesperformedby theContractorpursuanttothisAgreement. The City shall provide written notice of any request modification to the scope of services provided by ContractorpursuanttothisAgreement,andtheContractorshallprovidetheCitywithanyinformation requestedbytheCityinconnectionwiththeproposedchanges.TheContractorshall,withinsixty(60) days after receipt of such notice by the City, respond to the City's order. The Contractor may seek additionalcompensationintheeventthescopeofservicesismodifiedinaccordancewiththisSection 4.8. The need for and amount of additional compensation shall be calculated following a change in scopeRatereviewpursuanttoSection11.3.

454 455 456 457 458 459 460 461 462 463 464 465 466 467 468 469 470 471 472 473 474 475

Section 4.9: Billing


Contractor shall bill all Customers and be solely responsible for collecting billings at Rates set in accordance with Article 11. Billing shall be performed on the basis of services rendered and this Agreement shall create no obligation on the part of any Person on the sole basisof the ownership of property. Contractors website shall provide Customers with the ability to pay their bills through an electronic check or credit card and include the ability for Customer billings to be automatically charged on a recurringbasis.Contractorshallprepare,mail,andcollectbillsfromCustomerswhodeclinetousesuch internetbased billing system. Contractor shall make arrangements to allow Customers to pay bills by cash,check,electroniccheck,moneyorder,andcreditcardatContractorsofficewithintheCitywhich shallbeavailabletoCustomersfrom8:00a.m.to5:00p.m.MondaythroughFriday. Contractorshallmaintaincopiesofallbillingsandreceipts,eachinchronologicalorder,fortheTermof thisAgreement,forinspectionandverificationbytheCityContractManageratanyreasonabletimebut innocasemorethanthirty(30)calendardaysafterreceivingarequesttodoso. ContractorshallberesponsibleforcollectionofpaymentfromCustomerswithpastdueaccounts(bad debt).Contractorshallmakereasonableeffortstoobtainpaymentfromdelinquentaccountsthrough issuance of late payment notices, telephone requests for payments, and assistance from collection agencies. In the event that any account becomes more than fortyfive (45) calendar days past due, Contractor shall notify such Customer of the delinquency via written correspondence and telephone contact. Should any account become more than ninety (90) calendar days past due, Contractor shall provide notice to the Customer via written correspondence, with a copy to the City Contract Manager, that 18 TheCityofRidgecrest FranchiseAgreement

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servicemaybediscontinuediftheaccountbecomesmorethanonehundredtwenty(120)calendardays past due. Should any account become more than one hundred twenty (120) calendar days past due, Contractor may discontinue providing service to the Customer. No less than seven (7) calendar days prior to discontinuing service to a Customer, Contractor shall notify the City Contract Manager of the address, Service Level, service frequency, and delinquent billing amount. Contractor may withhold servicefromadelinquentaccountuntilpastdelinquenciesarepaidinfull.Uponrestoringservicetoa previouslydelinquentaccount,ContractormayrequireadepositfromtheCustomernottoexceedone (1)monthsbillingsattheCustomersServiceLevel.

484 485 486 487 488 489 490 491

Section 4.10: Transition to Next Contractor at End of Agreement


Ifapplicable,beforeexpirationorearlierterminationofthisAgreement,Contractorwilltakedirection from the City and subsequent contractor to assist in a timely and orderly transition of services from Contractortosubsequentcontractor.InresponsetotheCitysdirection,Contractorshallprovidethen thencurrent route lists, which identify each Customer on the route, its service level (number of Containers, Container sizes, frequency of Collection, scheduled Collection day), and any special Collectionnotes,anddetailedthencurrentCustomeraccountandbillinginformation.Contractormay, butshallnotbeobligedto,sellCollectionvehicles,equipment,orfacilitiestothenextcontractor.

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492

ARTICLE 5: PROCESSING AND TRANSFER


Section 5.1: Processing and Transfer Arrangements
TheContractorshallmakeitsownProcessingandTransferarrangements,solongassucharrangements areinfullcompliancewithApplicableLaw.TheCitymayordertheContractortomodifyorterminateits Processingand/orTransferarrangementsif: A. B. TheCitydeterminesthatsucharrangementsthreatenpublichealthorsafety,or TheCitydeterminesthattheCityisnotadequatelyprotectedfromliabilityfortheactivitiesofthe ProcessingorTransferentities,or TheCitydeterminesthatthediversionlevelsoftheparticularfacilitycausestheCitytobeoutof compliancewithAB939oranyotherregulationsregardingSolidWasteandRecyclableMaterials management,ortheContractorisDisposingofRecoveredMaterialsinamannerorvolumewhich doesnotresultinsignificantdiversioncredittotheCity.

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C.

In the event the City directs the Contractor to modify or terminate waste Processing or Transfer arrangements, the City acknowledges that the Contractor shall nonetheless be entitled to recover, throughtheRatestobechargedandauthorizedtobeimposedhereunder,thereasonableunrecovered capital costs of the Contractor incurred in initially implementing such Processing or Transfer arrangements(determinedinaccordancewithgenerallyacceptedaccountingprinciples).

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Section 5.2: Recyclable Materials Marketing


The Contractor shall be responsible for marketing Recyclable Materials Collected in the City. Contractorsmarketingstrategyshallmakereasonablebusinesseffortstopromotethehighestandbest useofmaterialspresentedinthewastemanagementhierarchyestablishedbyAB939.Wherepractical and costeffective, the marketing strategy should include use of local, regional, and domestic markets for Recyclable Materials. Contractor shall make available to the City Contract Manager any and all documentation of the final disposition of marketed Recyclable Materials as well as certification that suchmaterialshavenotbeenlandfilledorincinerated.

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Section 5.3: Title to Recovered Materials


As between the Parties, the Contractor has title to and liability for all Recovered Materials, and shall indemnify, defend, and hold harmless the City from any property damage, personal injury, or consequential damages suffered by any Person from exposure to or as a result of Processing any Recovered Materials or subsequent product made from Recovered Materials based on any theory of liability. The Contractor shall promptly notify the City of any claim by any Person arising out of the marketing,Disposal,orreuseofRecoveredMaterials.

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TheCityofRidgecrest FranchiseAgreement

524

ARTICLE 6: SOLID WASTE DISPOSAL


Section 6.1: Solid Waste Disposal
A. DisposalGenerally.TheContractorshallTransportandDisposeofallSolidWasteandRecyclable Materials which it Collects but does not divert from landfill Disposal at the Designated Disposal Facility in accordance with the requirements of Applicable Law, and shall comply with the requirements,rulesandregulationsoftheOwneroroperatoroftheDesignatedDisposalFacility. DesignatedDisposalFacilities.TheCityshallhavetherightduringtheTermoftheAgreementto designatetheDesignatedDisposalFacility,ormultipleconcurrentDesignatedDisposalFacilities,in itssoleandabsolutediscretion.TheinitialDesignatedDisposalFacilitiesshallbeanyoftheKern County landfills as approved by the City. The City shall notify the Contractor in writing of any changesinoradditionstotheDesignatedDisposalFacility. Disposal Records. The Contractor shall keep and maintain such logs, records, manifest, bills of lading or other documents as the City may deem to be necessary or appropriate to confirm compliance by the Contractor with this Agreement and shall retain all weight slips or other call information provided to the Contractor's drivers by the Owner or operator of the Designated DisposalFacility. Failure to Transport to Designated Disposal Facility. The Contractor's failure to properly Transport,orcausetobeTransported,SolidWasteandRecyclableMaterialsasdescribedhereinis an Event of Default. as described in Section 13.1.A of this Agreement, unless the failure to Transport such Solid Waste and Recyclable Materials to the Designated Disposal Facility is the resultofanUncontrollableCircumstanceorsuchwastehasbeendivertedbymeansofalternative technologyallowingAB939diversioncredittotheCity;providedhowever,thatanyresiduefrom ProcessingordiversionactivitiesoccurringwithintheCountyshallbeDisposedattheDesignated DisposalFacility. Flow Control Covenant. The Contractor hereby waives any right which it may possess under Applicable Law to contest on any ground, constitutional, statutory, case law, administrative or otherwise: (a) the right, power, or authority of the City to engage in the practice of legal Solid Waste "flow control" or to enter into or perform obligations under this Agreement; or, (b) the right,power,orauthorityoftheCitytodeliverorcausethedeliveryofallSolidWasteCollected withintheCitytotheDesignatedDisposalFacilityinaccordancewiththisAgreement.

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B.

C.

D.

E.

554 555 556 557

Section 6.2: Gate Fees


To the extent that the Contractor Disposes or causes the Disposal of NonResidential Waste at the DesignatedDisposalFacility,itshallpaythegatefeesrequiredunderCountyOrdinanceNo.G5940,as maybeamendedfromtimetotime,unlessspecificallyexemptedhereunder.

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558 559 560 561 562 563 564 565 566 567 568 569 570 571 572 573 574 575 576 577 578 579 580 581 582 583 584 585 586 587 588 589 590 591 592 593 594 595 596 597

Section 6.3: Bin Fees


A. General.AbindisposalfeeshallbechargedforallNonResidentialwastebinsthatarecollected bytheContractorfordisposalattheDesignatedDisposalFacility. DisposalFee.ThebindisposalfeeshallbebasedonthebasicpertongatefeefornonResidential Wasteandshallbecalculatedusingthefollowingformula: ThebasicpertongatefeefornonResidentialWaste,dividedbytwothousandpoundsequalsthe feeperpound.Thefeeperpound,multipliedbytheaverageweightinpoundsofacubicyardof SolidWastefoundinbins,equalsthebindisposalfeepercubicyard.Thebindisposalfeepercubic yard multiplied by the capacity of a bin equals the total bin disposal fee per time the bin is collectedbytheContractor. C. Verification ofWeight. Theaverage weightofacubicyardofSolidWastefromNonResidential wastebinsshallbeconfirmedbytheCountybyperformingwastevolume/weightstudies,atleast once per year. The County shall report the results of the waste volume/weight studies to the County'sBoardofSupervisorsonanannualbasisandshallrecommendmodificationstotheBin DisposalFeeasmaybeappropriate. Records. The Contractor shall maintain adequate and accurate records of the number of Non Residentialwastebins,thecubicyardcapacityofeachNonResidentialwastebinandthenumber of times each NonResidential waste bin has been collected for each NonResidential customer served by the Contractor. Contractor shall cooperate with any request by the County or City ContractManagertoprovidesuchrecordsuponrequest. NonResidential Bin Report. The Contractor shall prepare a NonResidential Bin Report and forwardacopyofsaidreporttotheCountywithinfive(5)workingdaysofproducinginvoicesor statements for bin collection services rendered by the Contractor. The County may approve extensionsgrantingtheContractoradditionaltimetoprepareorforwardtheirNonResidentialBin Reports. The information in the NonResidential Bin Reports shall match the information that appears on the Contractor's invoices or statements and any information required in the Bin ReportsmaybeauditedbytheCounty.TheNonResidentialBinReportsshouldlist,ataminimum, the number of NonResidential bins billed to each NonResidential account, the bin volume (in cubicyards),andthenumberoftimeseachbinwascollectedinthebillingperiod.NonResidential Bin Reports shall be reviewed by the Contractors accounting staff to confirm that the rates charged by the Contractor are in compliance with this Section and all other applicable City and Countyordinance,resolutions,regulationsandrules.Thenumberofreportedcubicyardsshallbe usedbytheCountytocalculatetheamountoftheBinDisposalFeetheCountywillreceivefrom theContractor. Paymentof BinDisposal Fee.TheContractorshall forwardallmoniesduetotheCountywithin fifty(50)daysfromthedatethatappearsontheinvoicesorstatementssentbytheContractorto theirCustomers. Exemption from Payment of Bin Disposal Fee. A Bin Disposal Fee shall not be charged for any NonResidentialwastebinsthatarecollectedbytheContractoriftheSolidWastefromthosebins istransportedtoamaterialrecoveryfacilitypriortodisposalattheDesignatedDisposalFacility. 22 TheCityofRidgecrest FranchiseAgreement

B.

D.

E.

F.

G.

598

ARTICLE 7: RECYCLING PROGRAMS


Section 7.1: The Contractor's Responsibility for Implementation
TheContractorwillimplementitsRecyclingPlan(ExhibitC6),SRREprograms(ExhibitE),andcompliance order programs (Exhibit F) in a manner approved by the City Contract Manager. The requirements of and level of specificity contained within each of these exhibits may conflict or be redundant in some cases. Regardless of such inconsistencies, Contractor shall be obligated to comply with all of the requirements contained therein and in the case of any inconsistency, the City Contract Managers determinationofwhichrequirementsmustbemetshallbeconclusive. In the event that the State of California diversion goals in existence at the time this Agreement is effective are increased, the Contractor will be obligated to amend the Recycling Plan to the extent necessary to comply with the increased diversion levels. In the event the City's SRRE is revised in response to the increased requirements, the Contractor will, at the request of the City Contract Manager,developandsubmitfortheCity'sapprovalsuggestedrevisionstotheRecyclingPlandesigned toenabletheCitytomeettherevisedrequirements,includingestimatedcostsofimplementationand targeteddiversionrates.AfterapprovalbytheCity,theRecyclingPlanwillberevisedandtheContractor willimplementsuchrevisedRecyclingPlan.

599 600 601 602 603 604 605 606 607 608 609 610 611 612 613

614 615 616 617 618

Section 7.2: Recycling Plan


The Contractor is responsible for developing and implementing Residential and Commercial source reduction, Recycling, education, and outreach programs to all Customers in the City. The Contractor's RecyclingPlanisattachedheretoasExhibitC6.AnyamendmenttotheRecyclingPlanmustbeapproved bytheCity.

619 620 621 622 623 624 625 626 627 628

Section 7.3: Public Awareness


The Contractor agrees, at its own expense, to provide information to Customers at least quarterly on such topics as proper Household Hazardous Waste Disposal, waste reduction and Recycling, or such othertopicsincludedaspartoftheContractor'sRecyclingPlan(ExhibitC6). AnyreferencetotheCity must be approved in advance by the City Contract Manager. To the extent reasonably possible, the Contractor shall accommodate the inclusion of any Citydirected information on its regular billing statementsupontherequestoftheCityContractManagerwithoutcosttotheCity.IftheCityrequests the distribution of information on a topic other than that required for compliance with the Recycling Plan in a form that cannot be printed or included with the Contractor's regular bill, the City and Contractorwillshareinthecostofprintinganddistribution.

23

TheCityofRidgecrest FranchiseAgreement

629 630 631 632 633 634 635

Section 7.4: Termination for Failure to Implement Strategies


FailuretoimplementanyoneoftheprogramslistedintheRecyclingPlan(ExhibitC6),SRREprograms (Exhibit E), and/or compliance order programs (Exhibit F) will be deemed an Event of Default unless Contractor can demonstrate to the satisfaction of the City Contract Manager that implementation of suchprogramsisbeyondthereasonablescopeoftheircontroldespitetheirreasonablebusinessefforts. Forexample,andnotbywayoflimitation,itisbeyondthereasonablescopeoftheContractorscontrol toaffectordinancesadoptedbytheCityCouncil..

24

TheCityofRidgecrest FranchiseAgreement

636

ARTICLE 8: OPERATING ASSETS


Section 8.1: Operating Assets
A. Obligation to Provide. The Contractor shall acquire and maintain at its own cost and expense, Operating Assets which in number, nature, and capacity shall be sufficient to enable the ContractortoprovidetheCollectionServicesinaccordancewiththetermshereofandsuchassets shallbesubjecttoinspectionbytheCityatanytime. Vehicle and Equipment Identification. The Contractor's name, phone number, and Vehicle or equipmentnumbershallbevisiblydisplayedinlettersnotlessthanthree(3)inchesinheighton bothsidesofitsVehiclesorotherCollectionequipmentusedbytheContractor,asrequiredbythe MunicipalCode. Vehicle Specifications, Maintenance, and Appearance. All Vehicles shall be properly registered withtheDepartmentofMotorVehiclesoftheStateofCalifornia,shallbeproperlyinsured,shall beofatypeapprovedbytheCity,shallbekeptcleanandingoodrepair,andshallbecontinuously maintained in a watertight condition. Vehicles used to Collect or Transport Solid Waste shall be keptcoveredatalltimesexceptwhensuchmaterialisactuallybeingloadedorunloaded,orwhen theVehiclesaremovingalongaCollectionrouteinthecourseofCollection.AllVehiclesshallcarry abroom,shovel,andoperablefireextinguisher.SolidWasteCollectionVehiclesshallbewashed at least once every seven (7) days and cleaned and painted as required to maintain a clean appearance.AllVehiclesmustbemadeavailableforinspectionuponreasonablenoticebytheCity ContractManager. Spillage.AnycoverorscreenshallbesoconstructedandusedthatSolidWasteshallnotblow,fall, orleakoutoftheVehicleontothestreet. In the eventofaspill,leak,orlossofpayloadduring transit, the Contractor shall immediately arrange for the cleanup and Transportation of the payload to the appropriate facility at the Contractor's sole cost and expense, shall pay any resultingfines,assessments,penalties, ordamagesresultingtherefrom,andshallindemnifyand holdharmlesstheCityinaccordancewiththeproceduresprovidedinSection12.1hereoffromall lossandexpenseresultingtherefrom. ComputerSystemCompatibility.TheContractorshallmaintainrecordsanddatainanelectronic formatcompatiblewiththeversionsofMicrosoftWordandExcelcurrentlyinusebytheCityat anygiventimeduringtheTermofthisAgreement.TheContractorwill,atitscostandexpense,if requestedbytheCityContractManager,provideanyreportsordatarequiredbythisAgreement viaemail,oncomputerdisc,orthroughotherelectronicformat.Raworprinteddatamaynotbe submitted as a substitute to the Contractor's obligation to provide various reports under this Agreement.

637 638 639 640 641 642 643 644 645 646 647 648 649 650 651 652 653 654 655 656 657 658 659 660 661 662 663 664 665 666 667 668 669

B.

C.

D.

E.

25

TheCityofRidgecrest FranchiseAgreement

670 671 672 673 674 675 676 677 678

Section 8.2: Operation and Maintenance of the Operating Assets


TheContractor,atitscostandexpense,shallatalltimes:1)operatetheOperatingAssetsproperlyand inasafe,sound,andeconomicalmanner;2)shallmaintain,preserve,andkeeptheOperatingAssetsin good repair, working order, and condition; 3) shall staff the Operating Assets with the appropriate number of licensed employees consistent with good management practice; and, 4) shall make all necessary and proper repairs, replacements, and renewals, so that at all times the operation of the Operating Assets may be properly and advantageously conducted. The Contractor shall maintain the safety of the Operating Assets at a level consistent with Applicable Law, the Insurance Requirements, andprudentSolidWastemanagementpractices.

679 680 681 682 683 684 685 686 687 688 689 690 691 692 693 694 695 696 697 698 699 700 701 702 703 704 705 706 707 708 709 710

Section 8.3: Containers


A. City Regulations. The City shall approve the number, type, size, and other specific physical requirements for Containers. The Contractor shall not be required to Collect Solid Waste and RecyclableMaterialsfromContainerswhichhavenotbeenapprovedbytheCity. General Requirements. The Contractor shall supply the Containers for each Customer free of chargeuponinceptionofCollectionServices.AfteremptyinganyContainer,theContractorshall replace the Container in an upright position at the place where such Container was placed for Collection. The Contractor shall handle Containers in a manner so as to prevent damage or spillage, and shall not throw, drop, or otherwise mishandle Containers during or after emptying them. The Contractor shall repair or replace, at its own expense and within five (5) days, any Container which is damaged by the Contractor and which is no longer serviceable (e.g. broken wheels,crackedlid,brokenaxle,crackedorleakingbody,etc.).. ContainersforResidentialCustomers.TheContractorshallsupplyallContainersrequiredforthe servicesprovidedunderthisAgreement.TheContainersshallbesturdy,watertight,andequipped withheavydutywheelsandcloseablelids.TheContractorshallmaintaintheContainersingood repair,shallbearthecostofnormalwearandtear,andshallreplacetheContainersasneeded. The Contractor may charge a fee to Customers that have Containers that must be repaired or replacedduetootherthannormalwearandtearandwillnotifytheCityContractManagerifsuch feehasbeencharged.IfrepairsrequireremovaloftheContainerfromaCustomer'sPremises,the Contractor shall supply the Customer with a replacement Container or loaner" Container. The Contractorshall,withinseven(7)days,repairorreplacedamagedordilapidatedContainers.The Contractor shall provide the Containers required pursuant to this Section at its own cost and expenseandanysuchContainersshallconstituteOperatingAssets.TheContractorshallpromptly replacestolenContainers,providedthattheContractorshallonlybearthecostofreplacementof suchContainerthefirsttimeitisstolen;and,thereaftersuchcostofreplacementshallbeborne bytheCustomer. Containers for Commercial Customers. The Contractor shall provide, as an Operating Asset the ContainersrequiredpursuanttoSection8.3atitsowncostandexpense.EachsuchContainershall be identified with the Contractor's name and phone number, and be equipped with heavyduty casters and closeable lids. Each such Container shall be watertight. The Contractor shall be responsibleforthegeneralmaintenanceandrepairofContainerssoprovided,andshallprovide an equivalent Container as replacement during repairs and maintenance. If repairing, 26 TheCityofRidgecrest FranchiseAgreement

B.

C.

D.

711 712 713 714 715 716 717 718 719 720 721 722 723 E.

maintenance,steamcleaning,and/orrepaintingisrequiredasaresultofabuse,neglect,ormisuse onthepartofanyCustomer,theContractormaychargetheCustomerafee,tocompensatefor the cost thereof. The Contractor shall, within seven (7) days, repair or replace any stolen, damaged or dilapidated Container, provided that the Contractor shall only bear the cost of replacementofsuchContainerthefirsttimeitisstolenandthereaftersuchcostofreplacement shallbebornebytheCustomer. OwnershipofContainers.AllContainersforSolidWasteandRecyclableMaterialsprovidedbythe Contractor to Customers in accordance with this Agreement shall, at the sole discretion of the City, become the property of the of the City upon expiration or early termination of this Agreement.IntheeventthattheCitydesirestoretainownershipofsaidContainers,theCityshall notifyContractorofsuchdetermination.Contractorshallbeentitledtoreceivepaymentfromthe City or a future franchisee to the City, the remaining book value of such Containers based on a seven(7)yearstraightlinedepreciationschedule.

724 725 726 727 728 729 730 731 732 733 734 735 736 737 738

Section 8.4: Vehicle Requirements


Contractor shall provide a fleet of Collection Vehicles sufficient in number and capacity to efficiently performtheworkrequiredbytheAgreementinstrictaccordancewithitsterms.Contractorshallhave available sufficient backup Vehicles for each type of Collection Vehicle used to respond to scheduled and unscheduled maintenance, service requests, complaints, and emergencies. All such Vehicles shall havewatertightbodiesdesignedtopreventleakage,spillage,oroverflow.AllsuchVehiclesshallcomply withallFederal,State,andlocallawsandregulationsincluding,withoutlimitation,safetyandemissions requirementsandsuchcomplianceshallcomeatnoadditionalcosttotheCityorCustomersduringthe TermofthisAgreement. Collection Vehicles shall present a clean appearance while providing service under this Agreement. ContractorshallinspecteachVehicledailytoensurethatallequipmentisoperatingproperly.Vehicles that are not operating properly shall be taken out of service until they are repaired and operate properly.Contractorshallrepair,orarrangefortherepairof,allofitsVehiclesandequipmentforwhich repairsareneededbecauseofaccident,breakdownoranyothercausesoastomaintainallequipment inasafeandoperablecondition.

27

TheCityofRidgecrest FranchiseAgreement

739

ARTICLE 9: GENERAL REQUIREMENTS


Section 9.1: Public Access to the Contractor
A. Office Facilities. The Contractor shall establish and maintain an office within the City through whichtheContractor'srepresentativesmaybecontacted,unlessotherwiseapprovedbytheCity Contract Manager. {Proposer If you do not or will not have a local office in the City, please propose how you will provide for convenient access by the public for bill paying and customer service.} OfficeHours.TheContractor'sofficehoursshallbe,ata minimum,from8:00a.m.to5:00p.m. dailyexcept Saturdays,Sundays,andholidays.Thesehoursmay bealteredwiththeapprovalof theCityContractManager. Emergency Telephone Number. The Contractor shall provide the City with an emergency telephone number for use by the City Contract Manager outside normal business hours. The Contractor shall have a representative, or an answering service to contact such representative, availableattheemergencytelephonenumberduringallhoursotherthannormalofficehours.

740 741 742 743 744 745 746 747 748 749 750 751 752

B.

C.

753 754 755 756 757 758 759 760 761 762 763 764

Section 9.2: Service Complaints


A. ComplaintstoContractor.TheContractorshallmaintainduringofficehoursacomplaintservice and telephone answering system having an answering capacity satisfactory to the City Contract Manager. All service complaints and billing complaints will be directed to the Contractor. The Contractorshallrecordallcomplaintsinalog,includingdate,complainantnameandaddress,and natureandresolutionofcomplaint.ThislogshallbeavailableforinspectionbytheCityContract ManagerduringtheContractor'sregularofficehours.CopiesthereofshallbefurnishedtotheCity ContractManageruponrequest. RequiredResponsetoComplaints.TheContractor,withintwentyfour(24)hoursofitsreceiptof notice from a Customer or the City Contract Manager of a failure to provide any service(s) as requiredbythetermsofthisAgreement,shallprovidesuchserviceinamannerconsistentwith therequirementsofthisAgreement.

B.

765 766 767 768 769 770 771 772

Section 9.3: Accounting and Records


A. Maintenance and Audit of Records. The Contractor shall maintain in its principal office in the County full and complete financial statements and accounting records for operations under this Agreement. Contractorshallaccount forrevenues receivedandexpensesincurredasaresultof thisAgreementseparatefromtheaccountingforotheroperationsperformedbyContractororits affiliates.TheGrossReceiptsderivedfromtheCollectionServicesunderthisAgreement,whether whethersuchservicesareperformedbytheContractororbyaSubcontractor,shallberecorded asrevenuesintheaccountsoftheContractor.Upondemand,theContractorshallpermittheCity 28 TheCityofRidgecrest FranchiseAgreement

773 774 775 776 777 778 779 780 781 782 783 784 785 786 787 788 789 790 791 792 793 794 795 B.

Contract Manager to examine and audit the books of account of the Contractor at any and all reasonabletimes.Uponrequest,theContractorshallallowtheCityContractManagertoexamine thereports,theaccountsreceivableandtheinvoicespertainingtoanyfeeorchargeapprovedby the City Council for Services provided under this Agreement. Such request shall be made at reasonabletimesandwithreasonablenotice. In the event that a Special Circumstance Rate adjustment is requested, such records shall be subjecttoreviewinaccordancewithappropriateprofessionalstandards,andinspection,forthe primary purpose of reviewing changes in costs to the Contractor attributable to the Special Circumstancerequest,atanyreasonabletimebyanindependentthirdparty.Theselectionofthe independentthirdpartyaswellasthescopeofworkforsuchreviewshallbeapprovedinadvance by the City Contract Manager. The independent reviewer shall provide any and all drafts of its reviewtotheCityandtheContractor.ThePartyrequestingtheSpecialCircumstanceRatereview shallbearthecostofthereview. TheContractorshallmaintainandpreserveallcash,billing,andDisposalrecordsthroughoutthe TermofthisAgreementandforaperiodofnotlessthanthree(3)yearsfollowingexpirationor earlyterminationoftheAgreement.TheContractorshallobtain,withinonehundredtwenty(120) days of a request by the City Contract Manager, complete independently audited financial statements for the prior calendar year, including its balance sheet, statement of revenues and expenses,andstatementofchangesincashposition,andprovidesuchfinancialstatementstothe CityContractManager. Confidentiality.TheCityagreestoholdfinancialstatementsdeliveredpursuanttothisSectionas confidential and shall not disclose the same unless and to the extent disclosure is required pursuanttoApplicableLaw.

796 797 798 799 800 801 802 803 804

Section 9.4: Reporting


TheContractorshallmaintainonfileatitsbusinesspremisesdocumentation settingforth itsRouting andCollectionSystem,alistofallCollectionPremisesintheCity,organizedalphabeticallyorbyaddress, andtheidentificationofallserviceseachreceives.Thisinformationshallbeupdatedandprovidedatno additionalcosttotheCityalongwithContractorsannualreport(asrequiredinExhibitD)totheCityand any time upon request of the City Contract Manager. The Contractor shall cooperate with the City to periodicallymonitortheaveragevolumeofSolidWasteandRecyclableMaterialsgeneratedfromeach CollectionPremises.Customerspecificrecordsaresubjecttoinspection,andcopyingbytheCityduring regularbusinesshourswithreasonableadvancenotice.

805 806 807 808 809 810 811

Section 9.5: Integrated Waste Management Act (AB 939) Compliance


The Contractor shall provide on a monthly basis all necessary reporting data requested by the City relatingtotheCity'scompliancerequirementspertainingtoAB939asitaffectstheCounty'sIntegrated WasteManagementPlanandtheCitysSRRE.SuchreportshallbeprovidedtotheCitywithinthirty(30) daysaftertheendofeachmonth.TheContractorshallcooperateinactivitiesrequestedbytheCityto measure diversion of Solid Waste from landfills including, but not limited to, providing a location for conductingwastesortingattheContractor'sfacility,reroutingtrucksonatemporarybasistofacilitate 29 TheCityofRidgecrest FranchiseAgreement

812 813 814 815 816

composition analysis. Such report shall include throughput, recovery rates per material type, residue, costs, Recyclable Material commodity values, and final disposition of Recyclable Materials. The Contractor shall also supply any other information reasonably requested by the City to meet State or Federal regulatory requirements and the reporting requirements of the City's SRRE, as those requirementsmaybeamendedfromtimetotime.

817 818 819 820 821 822 823 824 825 826 827 828 829 830 831 832 833 834 835 836 837 838 839 840

Section 9.6: Personnel and Subcontractors


A. Employment Practices. The Contractor shall at all times maintain and follow employment practices in accordance with all state and federal laws and regulations, and shall indemnify the CityforanyLegalProceedingrelatingtoitsnoncompliancewithsuchlawsorregulations. NonDiscrimination. In the performance of the terms of this Agreement, the Contractor agrees that it will not engage in nor permit such Subcontractors as it may employ to engage in discriminationagainstanyemployeeorapplicantforemploymentonthebasisofrace,sex,color, religion,ancestry,nationalorigin,maritalstatus,ageorasaqualifiedindividualwithadisability. This prohibition shall pertain to employment, upgrading, demotion, or transfer; recruitment advertising; layoff or termination; rates of pay and other forms of compensation; selection for training, including apprenticeship, and any other action or inaction pertaining to employment matters. Personnel.TheContractorshallemploypersonnelsufficientinnumber,training,experience,and capabilitytoensurethattheCollectionServicesrequiredtobeperformedunderthisAgreement areproperlycarriedout. Subcontractors. The Contractor shall not utilize any Affiliates or Subcontractors for the performance of the Collection Services except with the consent of the City Contract Manager, which may be withheld or delayed if the City Contract Manager determines, in their sole discretion, that such consent is not in the best interest of the public health, safety, or general welfare.IntheeventSubcontractorsareutilized,theContractorshallprovidetheCitywithdirect accesstoadesignatedrepresentativefromtheSubcontractor,suchdesignationnottobechanged without prior approval of the City Contract Manager, except in cases of termination of the employee. The Parties acknowledge the City's direct contact with any Subcontractors in no way eliminatestheContractor'sresponsibilitytofulfillitsobligationsunderthisAgreement.

B.

C.

D.

841 842 843 844 845 846 847 848

Section 9.7: City Contract Manager


The City has designated the City Contract Manager to be responsible for the monitoring and administrationofthisAgreement.ContractorshallmeetandconferwiththeCityContractManagerto resolvedifferencesofinterpretationandimplementandexecutetherequirementsofthisAgreementin anefficientandeffectivemannerthatisconsistentwiththestatedobjectivesofthisAgreement. From time to time the City Contract Manager may designate other agents at the City to work with Contractoronspecificmatters.Insuchcases,thoseindividualsshouldbeconsidereddesignatesofthe City Contract Manager for those matters to which they have been engaged. Such designates shall be

30

TheCityofRidgecrest FranchiseAgreement

849 850 851 852 853 854 855 856 857 858 859 860 861 862 863 864 865 866

affordedalloftherightsandaccessgrantedthereto.IntheeventofadisputebetweentheCityContract ManagersdesignateandContractor,theCityContractManagersdeterminationshallbeconclusive. In the event of dispute between the City Contract Manager and the Contractor regarding the interpretation of or the performance of services under this Agreement, the City Contract Managers determinationshallbeconclusiveexceptwheresuchdeterminationresultsinamaterialimpacttothe Contractors revenue and/or cost of operations. In the event of a dispute between the City Contract Manager and the Contractor that results in such material impact to the Contractor, Contractor may appealthedeterminationoftheCityContractManagertotheCityCouncil,whosedeterminationshall be conclusive. For the purposes of this definition, material impact is an amount equal to or greater thanonequarter(1/4)ofone(1)percentofContractorsannualGrossReceiptsunderthisAgreement. City Contract Manager or their designate shall have the right to observe and review Contractor operations and Processing Facilities and enter Premises for the purposes of such observation and review,includingreviewofContractorsrecords,duringreasonablehourswithreasonablenotice.Inno eventshallContractorpreventaccesstosuchPremisesforaperiodofmorethanthree(3)calendardays afterreceivingsucharequest. The City contract manager is authorized and empowered to adjust, settle, or compromise any controversy or charge arising from the operations under this Agreement, either on behalf of the City, contractor,orthepublic,pursuanttoMunicipalCodeSection35.11(e).

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TheCityofRidgecrest FranchiseAgreement

867

ARTICLE 10: CITY FEES


Section 10.1: City Fees
A. AdministrativeFee.TheContractorshallpayanAdministrativeFeetotheCityeachquarter.The amountoftheAdministrativeFeeshallbeonehundredthousanddollars($100,000)inRatePeriod Oneandshallbepaidinequalquarterlyinstallments.TheCityshallusetheAdministrativeFeeto offset expenses including costs related to contract management, compliance monitoring, and to enforce the franchise with respect to any violations by third parties, including initiating and/or assistinginprosecutingenforcementactions.TheCityshallretainthesolerighttosetprioritiesfor its contract monitoring and enforcement among the City personnel. This fee shall be a Pass ThroughCost. Franchise Fees. Pursuant to Municipal Code Section 35.704, in consideration of the rights providedContractorherein,ContractorshallpayFranchiseFeestotheCityeachquarterequalto tenpercent(10%)ofGrossReceiptsforallservicesperformedunderthisAgreement.Thisfeemay beadjustedbyaCityCouncilresolution.ThisfeeshallbeaPassThroughCost. OtherFees.TheCityshallreservetherighttosetotherfeesasitdeemsnecessary,subjecttoCity Council approval. The time and method of payment shall be consistent with those for the Administrative Fee, and the fee adjustment process shall be consistent with that specified in Section10.2.

868 869 870 871 872 873 874 875 876 877 878 879 880 881 882 883 884

B.

C.

885 886 887 888 889 890 891

Section 10.2: Adjustment to Fees


Pursuant to Municipal Code Section ___, the City may adjust the fees established in this Article from timetotime during the Term of this Agreement and such adjustments shall be included in the adjustmentofRatesasdescribedinSection11.2andExhibitsB,B1,andB2. TheamountsoftheFranchiseFeeandAdministrativeFeeforsubsequentRatePeriodsshallbeadjusted annually in accordance with the adjustment method described in Exhibit B, or shall be the amount specifiedbytheCity.

892 893 894 895 896 897 898 899

Section 10.3: Payment Schedule and Late Fees


Within thirty (30) days of the end of each calendar quarter, during the Term of this Agreement and including the final calendar quarter or portions thereof at the end of the Term of this Agreement, ContractorshallremittoCityallfeesasdescribedinthisArticle.SuchfeesshallbepayabletoCityand sentordeliveredtotheCityContractManager. IfsuchremittanceisnotpaidtoCityonorbeforethethirtieth(30th)dayfollowingtheendofacalendar quarter,allfeesduesshallbesubjecttoadelinquencypenaltyofthreepercent(3%),whichattacheson thefirstdayofdelinquency.Thedelinquencypenaltyshallbeincreasedanadditionalthreepercent(3%) 32 TheCityofRidgecrest FranchiseAgreement

900 901 902 903 904 905 906 907 908 909 910 911 912 913 914 915 916 917 918 919

andappliedtoboththeoriginalamountdueaswellasanydelinquencypenaltiespreviouslyappliedfor eachadditionalmonththepaymentremainsdelinquent.Forexample,iftheamountoftheoriginalfees feesowedequalsonehundredthousanddollars($100,000)theinitialdelinquencyamountappliedon the first day of delinquency will be three thousand dollars ($3,000) bringing the total amount to one hundredthreethousanddollars($103,000).Ifthatamountbecomespastdueforanadditionalmonth, the additional delinquency penalty shall be applied to the one hundred three thousand dollars ($103,000) therefore, the new total amount due would be one hundred six thousand ninety dollars ($106,090). EachquarterlyremittancetotheCityshallbeaccompaniedbyastatementlistingtheamountofeach fee paid; calculation of each fee; and, statement of Gross Receipts, by line of business for the period Collected from all operations conducted or permitted by this Agreement. The City Contract Manager may,atanytimeduringtheTerm,requestadetailedcalculationofGrossReceiptswhichmayinclude, butisnotnecessarilylimitedto,thenumberofCustomerschargedateachServiceLevelandRatefor eachbillingperiod. The City Contract Manager may, at any time during the Term or within three years following the expirationorearlyterminationofthisAgreement,performanauditofContractorsbillingsandpayment offees.Contractorshallfully cooperatewiththeCityContract Managerinanysuchaudit.Shouldthe Cityoritsagentperformthisreviewandidentifybillingerrorsorothererrorsinpaymentoffeesvalued atone(1%)percentormoreofGrossReceipts,Contractorshall,inadditiontocompensatingtheCityfor lostfeesandapplicabledelinquencypenalties,reimbursetheCityscostofthereview.

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TheCityofRidgecrest FranchiseAgreement

920

ARTICLE 11: CONTRACTORS COMPENSATION AND RATE SETTING


Section 11.1: General
The Contractors compensation for performance of all its obligations under this Agreement shall be Gross Receipts. Contractor's compensation provided for in this Article shall be the full, entire and complete compensation due to Contractor pursuant to this Agreement for all labor, equipment, materials and supplies, Processing and Disposal fees, fees due to the City, taxes, insurance, bonds, overhead,operations,profit,andallotherthingsnecessarytoperformalltheservicesrequiredbythis Agreementinthemannerandatthetimesprescribed.NothinghereinshallobligatetheCitytoprovide anycompensationtoContractorbeyondGrossReceipts. IfContractorsactualcosts,includingfeesduetotheCity,aremorethanGrossReceipts,Contractorshall notbecompensatedforthedifferenceinactualcostsandactualGrossReceipts.IfContractorsactual costs,includingfeesduetotheCity,arelessthantheactualGrossReceipts,Contractorshallretainthe difference. Under this Agreement, Contractor shall have the right and obligation to charge and collect from Customers,RatesthatareapprovedbytheCitypursuanttoMunicipalCodeSection___forprovisionof services to Customers. The Rates for Rate Period One (Exhibit C3) are based on the Contractors Proposal.ContractorsproposedcostsandoperatingassumptionsforRatePeriodOnearepresentedin Exhibit C2. The rates established by the City are maximum Rates and Contractor may, in its sole discretion,chargeCustomersanyamountuptoandincludingtheapprovedmaximumRateforagiven levelofservice. RevenuesreceivedforthesaleofRecyclableMaterialsincludingCaliforniaRedemptionValuerevenues have been considered in the establishment of Rates for services provided under this Agreement. NeitherContractornortheApprovedRecyclableMaterialsProcessingFacilityareentitledtograntfunds available through CalRecycle through its Curbside Supplemental Payments for registered curbside Recycling programs or City/County Payment Program pursuant to Section 14581(a)(5)(A) of the CaliforniaBeverageContainerRecyclingandLitterReductionAct.

921 922 923 924 925 926 927 928 929 930 931 932 933 934 935 936 937 938 939 940 941 942 943 944 945

946 947 948 949 950 951 952 953 954 955

Section 11.2: Rates and Annual Adjustments


A. General.TheCityshallberesponsibleforapprovingmaximumRatesasdescribedinthisArticle. IfatanytimeduringtheTermoftheAgreement,theContractordeterminestheneedforaRate that does not appear on the City approved Rate schedule in Exhibit C3, Contractor shall immediatelynotifytheCityandrequestestablishmentofsuchRate.Forexample,ifaCustomer requiresCollectionofRecyclableMaterialsinafifteen(15)cubicyardCompactorfive(5)times per week and the City approved Rate schedule does not include this level of service, the ContractormustrequestthattheCityapproveaRateforthislevelofservice. Maximum Rates for Rate Period One. Maximum Rates for Rate Period One, which are presented in Exhibit C3, were determined by Contractor and were approved by the City 34 TheCityofRidgecrest FranchiseAgreement

B.

956 957 958 959 960 961 962 963 964 965 966 967 968 969 970 971 972 D. C.

resolution on or before the execution of the Agreement. The maximum Rates for Rate Period OneshallbeeffectivefromtheCommencementDateofthisAgreementthroughJune30,2013. Rates for Subsequent Rate Periods. Maximum Rates for subsequent Rate Periods shall be adjustedannuallyinaccordancewiththisSection11.2andExhibitsB,B1,andB2. Themultiindexbasedadjustment,whichisdescribedinExhibitB1,involvesuseofvariouscost adjustmentfactors(suchasthepercentagechangeintheConsumerPriceIndex,thepercentage change in the Fuel Index, and percentage change in the Designated Disposal Facility Tipping Fees)tocalculateadjustedRates.SuchRateadjustmentcalculationsshallbeperformedinstrict conformancetotheproceduresdescribedinExhibitB1. Rate Structure. The City and Contractor shall meet and confer to change the relationship of individualRatesincomparisonwithotherRates.Anysuchchangeswouldoccurinconjunction with the annual Rate adjustment process described in Section 11.2.C or in conjunction with a Rate adjustment resulting from an extraordinary Rate adjustment in accordance with Section 11.3.ChangestotheRateschargedunderthenewstructureshallbecalculatedinsuchaway thattherevisedRatestructuregeneratesatleastthesameamountoftotalrevenuewhenthe numberofaccountsateachServiceLevelaremultipliedbytheRateschargedforeachService LevelandthetotalforallServiceLevelsaresummed.

973 974 975 976 977 978 979 980 981 982 983 984 985 986 987 988 989 990 991 992 993 994

Section 11.3: Extraordinary Rate Adjustments


It is understood that the Contractor accepts the risk for changes in cost of providing services and the Service Levels requested by Customers and therefore the extraordinary adjustments to Rates shall be limited to a Change in Law or a Citydirected change in scope. If a Change in Law or a Citydirected changeinscope(pursuanttoSection4.8)occurs,theContractormaypetitiontheCityforanadjustment tothemaximumRatesinexcessoftheannualadjustmentdescribedinSection11.2. The City may petition for an Extraordinary Rate Adjustment at any time during the Term of the Agreement at the Citys sole discretion and need not be on the grounds of a Change in Law or City directedchangeinscope. Contractor shall prepare an application for the extraordinary Rate increase. Such submittal shall be prepared in compliance with the procedures described in Exhibit B2 and shall provide all information requestedbytheCityContractManagerspecifictothenatureoftherequestbeingmade.Contractor shallpayallreasonablecostsincurredbytheCity,includingthecostsofoutsideaccountants,attorneys, and/or consultants, in order to make a determination of the reasonableness of the requested Rate adjustment. The application shall clearly document the reason for the proposed adjustment, include calculationoftheproposedRateadjustments,andprovidesupportingdocumentation. IntheeventofsuchanapplicationforextraordinaryRateincrease,itisunderstoodthattheContractor shallhavetheburdenofdemonstratingtothereasonablesatisfactionoftheCityContractManagerthat thefailureoftheCitytoadjusttheRateswillresultintheContractorsfinanciallossorfailuretoachieve reasonableprofitabilityduetotheChangeinLaworaCitydirectedchangeinscope.TheContractorwill havetodemonstratefinanciallossorafailuretoachievereasonableprofitabilitybyallowingfortheCity ContractManagerreviewoffinancialstatementsandsupportingdocumentation. 35 TheCityofRidgecrest FranchiseAgreement

995 996 997 998 999

The City Contract Manager shall have the right to request any other information that, in their sole judgment, is necessary to establish the reasonableness or accuracy of Contractors request for an extraordinary Rate increase. Contractors failure to fully cooperate in a timely manner with any reasonablerequestforinformationbytheCityContractManagermayresultineitherthedelayordenial oftheapprovaloftherequestforanextraordinaryRateincrease

1000 1001 1002 1003 1004

Section 11.4: Publication of Rates


TheContractorshallprovidewrittennoticetoCustomersofproposedRatechanges.Suchwrittennotice shall be delivered to all Customers as part of the next quarterly or monthly billing statement which ContractorsendstoCustomers.ContractorshallalsopublishsuchRatesinaconvenientandeasilyfound locationonitswebsite.

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TheCityofRidgecrest FranchiseAgreement

1005 1006

ARTICLE 12: INDEMNITY, INSURANCE, AND PERFORMANCE BOND


Section 12.1: Indemnification
A. General.Contractorshallindemnify,defendwithcounselacceptabletoCity,andholdharmless (to the full extent permitted by law) City and its officers, officials, employees, volunteers, and agentsfrom andagainstanyandallclaims,liability,loss,injuries,damage,expense,andcosts (includingwithoutlimitationcostsandfeesoflitigation,includingattorneysandexpertwitness fees)(collectively,Damages)ofeverynaturearisingoutoforinconnectionwithContractors performanceunderthisAgreement,oritsfailuretocomplywithanyofitsobligationscontained in the Agreement, except to the extent such loss or damage was caused by the negligence or willfulmisconductoftheCity. Excluded Waste. Contractor acknowledges that it is responsible for compliance during the entire Term of this Agreement with all Applicable Laws. Contractor shall not store, Transport, use,orDisposeofanyExcludedWasteexceptinstrictcompliancewithallApplicableLaws. IntheeventthatContractornegligentlyorwillfullymishandlesExcludedWasteinthecourseof carrying out its activities under this Agreement, Contractor shall at its sole expense promptly take all investigatory and/or remedial action reasonably required for the remediation of such environmental contamination. Prior to undertaking any investigatory or remedial action, however, Contractor shall first obtain the Citys approval of any proposed investigatory or remedialaction.ShouldContractorfailatanytimetopromptlytakesuchaction,theCitymay undertakesuchactionatContractorssolecostandexpense,andContractorshallreimbursethe Cityforallsuchexpenseswithinthirty(30)calendardaysofbeingbilledforthoseexpenses,and any amount not paid within that thirty (30) calendar day period shall thereafter be deemed delinquent and subject to the delinquent fee payment provision of Section 10.3. These obligationsareinadditiontoanydefenseandindemnityobligationsthatContractormayhave underthisAgreement.TheprovisionsofthisSectionshallsurvivetheterminationorexpiration ofthisAgreement. Notwithstandingtheforegoing,Contractorsdutiesunderthissubsectionshallnotextendtoany claimsarisingfromtheDisposalofSolidWasteattheDesignatedDisposalFacility,including,but notlimitedto,claimsarisingunderComprehensiveEnvironmentalResponse,Compensationand Liability Act (CERCLA) unless such claim is a direct result of Contractors negligence or willful misconduct. C. Environmental Indemnity. Contractor shall defend, indemnify, and hold the City harmless againstandfromanyandallclaims,suits,losses,penalties,damages,andliabilityfordamages ofeveryname,kindanddescription,includingattorneysfeesandcostsincurred,attributableto thenegligenceorwillfulmisconductofContractorinhandlingExcludedWaste. RelatedtotheAct.Contractorsdutytodefendandindemnifyhereinincludesallfinesand/or penaltiesimposedbyCalRecycle,subjecttotherestrictionssetforthinPublicResourcesCode 37 TheCityofRidgecrest FranchiseAgreement

1007 1008 1009 1010 1011 1012 1013 1014 1015 1016 1017 1018 1019 1020 1021 1022 1023 1024 1025 1026 1027 1028 1029 1030 1031 1032 1033 1034 1035 1036 1037 1038 1039 1040 1041 1042

B.

D.

1043 1044 1045 1046 1047 1048 1049 1050 1051 1052 1053 1054 1055 1056 1057 1058 1059 1060 1061 1062 1063 1064 1065 1066 1067 1068 1069 1070 E.

Section40059.1,iftherequirementsoftheactarenotmet bytheContractorwithrespectto the waste stream Collected under this Agreement, and such failure is: (i) due to the failure of Contractor to meet its obligations under this Agreement; or, (ii) due to Contractor delays in providinginformationthatpreventsContractorortheCityfromsubmittingreportsrequiredby theActinatimelymanner. RelatedtoProposition218.ShouldtherebeaChangeinLaworanewjudicialinterpretationof ApplicableLaw,including,butnotlimitedto,ArticleXIIICandDoftheCaliforniaConstitution (CommonlyProposition218),whichimpactstheRatesfortheCollectionServicesestablishedin accordancewiththisAgreement,ContractoragreestomeetandconferwiththeCitytodiscuss theimpactofsuchChangeinLawoneitherPartysabilitytoperformunderthisAgreement. If, at any time, a Rate adjustment determined to be appropriate by both the City (which determination shall not be unreasonably withheld) and Contractor to compensate Contractor for increases in costs as described in this Agreement cannot be implemented for any reason, ContractorshallbegrantedtheoptiontonegotiatewiththeCity,ingoodfaith,areductionof servicesequaltothevalueoftheRateadjustmentthatcannotbeimplemented.IftheCityand Contractorareunabletoreachagreementonsuchareductioninservices,thenContractormay terminatethisAgreementupononehundredeighty(180)calendardayspriorwrittennoticeto theCity,inwhichcasetheContractorandtheCityshalleachbeentitledtopaymentofamounts dueforcontractperformancethroughthedateoftermination. Should a court of competent jurisdiction determine that the Contractor cannot charge and/or increase its Rates for charges related to Franchise Fees and Governmental Fees and charges, ContractorshallreducetheRatesitchargesCustomersacorrespondingamount. NothinghereinisintendedtoimplythatCaliforniaConstitution,ArticlesXIIICorXIIID,applyto theRatesestablishedforservicesprovidedunderthisAgreement;ratherthisSectionisprovided merelytoallocateriskofanadversejudicialinterpretationbetweentheParties. This provision (i.e., Section 12.1) will survive the expiration or earlier termination of this Agreement and shall not be construed as a waiver of rights by the City to contribution or indemnityfromthirdparties.

1071 1072 1073 1074 1075 1076 1077 1078 1079

Section 12.2: Insurance


General Requirements. Contractor shall, at its sole cost and expense, maintain in effect at all times duringtheTermofthisAgreementnotlessthanthefollowingcoverageandlimitsofinsurance: A. CoveragesandRequirements.DuringtheTermofthisAgreement,Contractorshallatalltimes maintain,atitsexpense,thefollowingcoveragesandrequirements.Thecomprehensivegeneral liabilityinsuranceshallincludebroadformpropertydamageinsurance. 1. Insurancecoverageshallbewithlimitsnotlessthanthefollowing: ComprehensiveGeneralLiability$2,000,000combinedsinglelimitperoccurrencefor bodilyinjury,personalinjury,andpropertydamage. 38 TheCityofRidgecrest FranchiseAgreement

1080 1081 1082 1083 1084 1085 1086 1087 1088 1089 1090 1091 1092 1093 1094 1095 1096 1097 1098 1099 1100 1101 1102 1103 1104 1105 1106 1107 1108 1109 1110 1111 1112 1113 1114 1115 1116 1117 2.

Automobile Liability $2,000,000 combined single limit per accident for bodily injury andpropertydamage(includecoverageforHiredandNonownedVehicles). Workers Compensation Statutory Limits/Employers Liability $1,000,000/accident forbodilyinjuryordisease. EmployeeBlanketFidelityBond$500,000peremployeecoveringdishonesty,forgery, alteration,theft,disappearance,anddestruction(insideoroutside). Pollution Legal Liability $1,000,000 per claim/occurrence and $2,000,000 aggregate forbodilyinjury,propertydamage,andremediationofcontaminatedsite. The City, its officers, agents, employees, and volunteers shall be named as additional insuredonallbuttheworkerscompensationandprofessionalliabilitycoverages. Said policies shall remain in force through the life of this Agreement and, with the exceptionofprofessionalliabilitycoverage,shallbepayableonaperoccurrencebasis unlesstheCitysRiskManagerspecificallyconsentsinwritingtoaclaimsmadebasis. For all claims made coverage, in the event that the Contractor changes insurance carriers Contractor shall purchase tail coverage or otherwise provide for continuous coverage covering the Term of this Agreement and not less than three (3) years thereafter. Proof of such tail or other continuous coverage shall be required at any timethattheContractorchangestoanewcarrierpriortoreceiptofanypaymentsdue. The Contractor shall declare all aggregate limits on the coverage before commencing performance of this Agreement, and the Citys Risk Manager reserves the right to require higher aggregate limits to ensure that the coverage limits required for this Agreement as set forth above are available throughout the performance of this Agreement. ThedeductiblesorselfinsuredretentionsarefortheaccountofContractorandshallbe thesoleresponsibilityoftheContractor. Eachinsurancepolicyshallprovideor beendorsed tostatethat coverageshallnotbe suspended, voided, canceled by either Party, reduced in coverage or in limits except after thirty (30) calendar days prior written notice by certified mail, return receipt requested, has been given to the City Contract Manager ten (10) Business Days for delinquentinsurancepremiumpayments). InsuranceistobeplacedwithinsurerswithacurrentA.M.Bestsratingofnolessthan AVII,unlessotherwiseapprovedbytheCityRiskManager. The policies shall cover all activities of Contractor, its officers, employees, agents and volunteersarisingoutoforinconnectionwiththisAgreement. ForanyclaimsrelatingtothisAgreement,theContractorsinsurancecoverageshallbe primary,includingasrespectstheCity,itsofficers,agents,employees,andvolunteers. AnyinsurancemaintainedbytheCityshallapplyinexcessof,andnotcontributewith, insuranceprovidedbyContractorsliabilityinsurancepolicy. 39 TheCityofRidgecrest FranchiseAgreement

3.

4.

5.

6.

7.

8.

9.

1118 1119 1120 1121 1122 1123 1124 1125 1126 1127 1128 1129 1130 1131 1132 1133 1134 1135 1136 1137 1138 1139 1140 1141 B.

10.

The Contractor shall waive all rights of subrogation against the City, its officers, employees,agents,andvolunteers.

Endorsements.PriortotheeffectivedatepursuanttothisAgreement,Contractorshallfurnish the City Contract Manager with certificates or original endorsements reflecting coverage required by this Agreement. The certificates or endorsements are to be signed by a Person authorizedbythatinsurertobindcoverageonitsbehalf.Allcertificatesorendorsementsareto be received by, and are subject to the approval of, the City Risk Manager before work commences. Renewals. During the Term of this Agreement, Contractor shall furnish the City Contract Manager with certificates or original endorsements reflecting renewals, changes in insurance companies, and any other documents reflecting the maintenance of the required coverage throughout the entire Term of this Agreement. The certificates or endorsements are to be signedbyaPersonauthorizedbythatinsurertobindcoverageonitsbehalf. Workers'Compensation.Contractorshallprovideworkerscompensationcoverageasrequired byStatelaw,andpriortotheeffectivedatepursuanttothisAgreement,Contractorshallfilethe followingstatementwiththeCity. IamawareoftheprovisionsofParagraph3700oftheLaborCodethatrequireeveryemployer to be insured against liability for workers' compensation or to undertake selfinsurance in accordance with the provisions of that code, and I will comply with such provisions before commencinganyservicesrequiredbythisAgreement. The Person executing this Certificate on behalf of Contractor affirmatively represents that she/hehastherequisitelegalauthoritytodosoonbehalfofContractor,andboththePerson executing this Agreement on behalf of Contractor and Contractor understand that the City is relyingonthisrepresentationinenteringintothisAgreement.

C.

D.

1142 1143 1144 1145 1146 1147 1148 1149 1150 1151 1152 1153

Section 12.3: Performance Bond


Within seven (7) calendar days of the Citys notification to Contractor that the City has executed this Agreement, Contractor shall file with the City a bond, payable to the City, securing the Contractor's performance of its obligations under this Agreement and such bond shall be renewed annually if necessarysothattheperformancebondismaintainedatalltimesduringtheTerm.Theprincipalsumof the bond shall be {Insert dollar value equal to approximately twentyfive (25%) percent of estimated annualGrossReceipts}Dollars($XXX,XXX)andshallbeadjustedeverythree(3)years,commencingwith RatePeriodThree,toequalthree(3)monthsofthepriorRatePeriodsannualGrossReceipts.Thebond shallbeexecutedassuretybyacorporationauthorizedtoissuesuretybondsintheStateofCalifornia that has a rating of A or better in the most recent edition of Bests Key Rating Guide, and that has a recordofserviceandfinancialconditionsatisfactorytotheCity.Thebondshallbeintheformattached asExhibitE.

40

TheCityofRidgecrest FranchiseAgreement

1154

ARTICLE 13: DEFAULT, REMEDIES AND TERMINATION


Section 13.1: Default and Remedies
A. EventsofDefault.EachofthefollowingshallconstituteanEventofDefault: 1. Anytransaction,withoutanyrequirementofnoticeorcureopportunity,notcomplyingwith therequirementsofSection15.7hereof. The failure by the Contractor for any reason to deliver to the Designated Disposal Facility SolidWasteCollectedbytheContractor. FailureorrefusaloftheContractortoperformanyterm,covenant,obligationorconditionin this Agreement other than a failure or refusal described in items (1) or (2) above, except thatnosuchfailureorrefusalshallgivetheCitytherighttoterminatethisAgreementunder thisSectionunless: (i) The City has given prior written notice to the Contractor, stating the existence of a specific failure or refusal to perform exists which will, unless corrected, constitute a materialbreachofthisAgreementonthepartoftheContractorandwhichwill,inthe Citysopinion,givetheCityarighttoterminatethisAgreementforcauseunderthis Sectionunlesssuchdefaultiscorrectedwithinfifteen(15)days,and The Contractor has neither challenged in an appropriate forum the City's conclusion thatsuchfailureorrefusaltoperformhasoccurredorconstitutesamaterialbreachof thisAgreementnorcorrectedordiligentlytakenstepstocorrectsuchdefaultwithin suchfifteen(15)dayperiodfromreceiptofthenoticegivenpursuanttotheclause(i) of this subsection (but if the Contractor shall have diligently taken steps to correct such default within a reasonable period of time, the same shall not constitute an Event of Default for as long as the Contractor is continuing to take such steps to correctsuchdefaultinatimelymanner).

1155 1156 1157 1158 1159 1160 1161 1162 1163 1164 1165 1166 1167 1168 1169 1170 1171 1172 1173 1174 1175 1176 1177 1178 1179 1180 1181 1182 1183 1184 1185 1186 1187 1188

2.

3.

(ii)

4.

ThewrittenadmissionbytheContractorthatitisbankrupt,orthefilingbytheContractorof avoluntarypetitionundertheFederalBankruptcyCode,ortheconsentbytheContractoror either Guarantor to the appointment by a court of a receiver or trustee for all or a substantial portion of its property or business, or the making by the Contractor or either Guarantor of any arrangement with or for the benefit of its creditors involving an assignmenttoatrustee,receiverorsimilarfiduciary,regardlessofhowdesignated,ofallor asubstantialportionoftheContractor'spropertyorbusiness. ThefinaladjudicationoftheContractorasbankruptafterthefilingofaninvoluntarypetition under the Bankruptcy Act, but no such adjudication shall be regarded as final unless and until the same is no longer being contested by the Contractor nor until the order of the adjudicationisnolongerappealable.

5.

41

TheCityofRidgecrest FranchiseAgreement

1189 1190 1191 1192 1193 1194 1195 1196 1197 1198 1199 1200 1201 1202 1203 1204 1205 1206 1207 1208 1209 1210 1211 1212 1213 1214 1215 1216 1217 1218 1219 1220 B.

6.

The failure of the Contractor to provide or maintain the Performance Bond required pursuanttoSection12.3hereof. AnyfailurebytheContractortocomplywiththeRidgecrestMunicipalCodeincluding,but not limited to, Sections 3501 through 35.112, Sections 35.701 through 35.704, and Sections13___through13___.

7.

Right to Terminate Upon Default. Upon a determination by the City Contract Manager that an EventofDefaulthasoccurred,theCityCouncilshallconductahearinguponten(10)daysnotice to the Contractor to determine if termination of the Agreement is in the best interests of the publichealth,safety,andgeneralwelfareofthecitizensoftheCity.Ifthefactfindermakessucha determination, the Contractor shall be deemed to have waived any right it may have under Applicable Law to notice of termination in excess of those notice provisions explicitly set forth herein. City'sRemediesCumulative:SpecificPerformance.TheCity'srighttoterminatethisAgreement under this Section 13.1 is not exclusive, and the City's termination of the Agreement shall not constituteanelectionofremedies.Instead,theyshallbeinadditiontoanyandallotherlegaland equitable rights and remedies which the City may have, including but not limited to specific performance,andfeesandexpensesincurredbyoronbehalfoftheCityinenforcingpaymentor performance of the Contractor's obligations hereunder if such nonperformance results in a judiciallydeterminedEventofDefaultbytheContractor. Possession of Property upon Termination or Suspension. In the event of termination or suspension for default, the City shall have the right to take possession of any and all of Contractor's equipment and other property used or useful in the Collection, Transportation, Processing, and Disposalof Solid Waste or Recyclable Materials and the billing and collection of fees for these services and to use such property. The City shall have the right to retain the possession of such property until such time as Contractor remedies the default or substitute services can be provided by another contractor. If the City retains possession of Contractors equipmentorotherpropertyaftertheperiodoftimeforwhichContractorhasalreadybeenpaid by means of bills issued in advance of providing service for the service involved, the Contractor shallbeentitledtothereasonablerentalvalueofsuchproperty(whichshallbeoffsetagainstany damages due the City for the Contractor's default). Contractor shall furnish the City with immediateaccesstoallofitsbusinessrecordsrelatedtoitsCustomersandbillingofaccountsfor Collectionservices.

C.

1221 1222 1223 1224 1225 1226 1227 1228 1229

Section 13.2: Liquidated Damages


InadditiontoanyotherremediesprovidedforinthisAgreement,theCityContractManagermaylevya chargeintheamountslistedbelowfortheContractor'sfailuretomeettherequirementsenumerated below.TheCityContractManager'sdecisiontolevysuchachargeshallnotbedeemedanelectionof remedies, but shall be cumulative with any other remedies provided for in this Agreement. The City ContractManager'sdecisionnottolevyanysuchchargeshallnotbedeemedawaiveofanybreachby ContractorunderthisAgreement.ThePartiesagreethatthefollowingLiquidatedDamagesrepresenta reasonable estimate of the amount of such damages, considering all of the circumstances existing on thedateoftheAgreement,includingtherelationshipofthesumstotherangeofharmtotheCitythat 42 TheCityofRidgecrest FranchiseAgreement

1230 1231 1232 1233 1234 1235 1236 1237 1238 1239 1240 1241 1242 1243 1244 1245 1246 1247 1248 1249 1250 1251 1252 1253 1254 1255 1256 1257 1258 1259 1260 1261 1262 1263 1264 1265 1266 1267 1268 1269

reasonably could be anticipated and anticipation that proof of actual damages would be costly or inconvenient.InsigningthisAgreement,eachPartyspecificallyconfirmstheaccuracyofthestatements madeaboveandthefactthateachPartyhadampleopportunitytoconsultwithlegalcounselandobtain anexplanationofthisLiquidatedDamageprovisionatthetimethatthisAgreementwasenteredinto. A. Excessive complaints. When Contractor or the City Contract Manager receives complaints from more than one percent (1%) of its client base within a six (6) month period, Contractor will be assessed twentyfive ($25) per complaint per occurrence during that period; and an additional twentyfive ($25) each twentyfour (24) hours until the complaint is reasonably resolved. For purposesofthissection,"complaints"shallmeansubstantiveandcredibleCustomernotifications to the Contractor or the City Contract Manager of missed pickups, property damage, missed commitments, employee misconduct or poor quality of service (e.g. litter on property or public rightofwayormisplacementofContainers). FailuretoremittheCityFees,orfilerequiredreportsinanaccurateandcompletemannerbythe fifthworkingdayfollowingtheduedateofsuchfeesorreports:fiftydollars($50)perdayforthe firstfive(5)days,thenfivehundreddollars($500)perdayforeachdayafterthefirstfive(5)days. Failure to provide access to Operating Assets or any other documents or information within fourteen(14)daysofarequestbytheCityContractManager:onehundreddollars($100)perday peroccurrence. Failure to charge a Customer at or below the maximum approved Rate: fifty dollars ($50) per occurrence per Customer where the number of Customers overcharged is less than twentyfive (25); five hundred dollars ($500) per occurrence per Customer where the number of Customers overchargedistwentyfive(25)ormore.Inaddition,Contractorshallberesponsibleforrefunding anyamountoverchargedtoeachCustomerdeterminedtobeovercharged.Contractorshallnotbe entitled to any refund from the City for Franchise Fees or other fees paid on overcharged amounts. FailuretoimplementanyoneofthestrategieslistedintheRecyclingPlan:fiftydollars($50)per dayforeachdayinexcessoffifteen(15)daysfollowingContractor'sreceiptofwrittennoticefrom City. Collectionoutsidepermittedhours:onehundreddollars($100)peroccurrence.

B.

C.

D.

E.

F.

IntheeventtheLiquidatedDamagespermittedtobeimposedunderthisSectionexceedtenthousand dollars($10,000)duringanythreehundredsixtyfive(365)dayperiodortheContractorhasviolatedthe requirementsforaparticularserviceindicatormorethanfour(4)timesinanAgreementYear,theCity Contract Manager may impose an additional penalty of twentyfive percent (25%) of the original amount of Liquidated Damages. For example, if the original amount of the Liquidated Damages totals onethousanddollars($1,000)thepenaltyamountwouldbetwohundredfiftydollars($250). The City Contract Manager shall give the Contractor written notice of charges levied pursuant to this Section.AnysuchdamagesshallbepaiddirectlytotheCity,andmaynotbeincludedbytheContractor asjustificationforanupwardadjustmentintheRatescheduleoroffsetagainstanyfees. The decision of the City Contract Manager shall be final and binding on the Contractor unless the ContractorfileswiththeClerkoftheCityCouncilaNoticeofAppealwithinfifteen(15)daysofreceiptof 43 TheCityofRidgecrest FranchiseAgreement

1270 1271 1272 1273 1274 1275

the City Contract Manager's decision. The Notice of Appeal shall be in writing and shall contain a detailedstatementofthebasisfortheappeal.UponreceiptoftheNoticeofAppeal,theCityContract Managershallsetthematterforapublichearingwithinthirty(30)days.TheCityContractManagershall givetheContractorandanyinterestedPersonrequestingthesame,ten(10)dayswrittennoticeofthe timeandplaceofthehearing.Atthehearing,theCityCouncilshalldetermine,basedontherecord,the appropriateactiontobetaken.ThedecisionoftheCityCouncilshallbefinalandconclusive.

1276 1277 1278 1279 1280 1281 1282 1283 1284 1285 1286 1287 1288 1289 1290 1291 1292 1293 1294 1295 1296 1297 1298 1299 1300 1301 1302 1303 1304 1305 1306

Section 13.3: Uncontrollable Circumstances


A. ExcusefromPerformance.IntheeventthataPartyispreventedfromperformingitsobligations underthisAgreementbyanUncontrollableCircumstance,itshallnotconstituteadefaultofthis Agreement,solongasthePartyingoodfaithhasuseditsbesteffortstoperformitsrespective obligations. ThePartyclaimingexcusefromperformanceshall,withinfive(5)daysaftersuchPartyhasnotice of the effect of such cause, give the other Party notice of the facts constituting such cause and asserting its claim to excuse under this Section. Specifically, such information shall include the following: 1. 2. TheUncontrollableCircumstanceandthecausethereof(totheextentknown); The date the Uncontrollable Circumstance began and the cause thereof, its estimated duration" the estimated time during which the performance of such Party's obligations hereunderwillbedelayed; ItsestimatedimpactontheotherobligationsofsuchPartyunderthisAgreement;and Potential mitigatingactionswhichmightbetaken bytheContractororCity andanyareas wherecostsmightbereducedandtheapproximateamountofsuchcostreductions.

3. 4.

Whilethedelaycontinues,theContractororCityshallgivedailynoticetotheotherPartyupdating theinformationpreviouslysubmitted. In the event that either Party validly exercises its rights under this Section, the Parties hereby waiveanyclaimagainsteachotherforanydamagessustainedthereby. B. City's Right to Terminate. The partial or complete interruption or discontinuance of the Contractor'sservicescausedbyone(1)ormoreoftheeventsdescribedinthisSection13.3shall notconstituteadefaultbytheContractorunderthisAgreement.Notwithstandingtheforegoing, however,iftheContractorisexcusedfromperformingitsobligationshereunderbecauseofany Uncontrollable Circumstance, the City shall nevertheless have the right, in its sole discretion, to terminatethisAgreementbygivingsixty(60)daysnotice. WorkStoppages.NotwithstandinganythinginthisAgreementtothecontrary,anystrikes,work stoppages, or other labor disputes or disturbances occurring with respect to an) activity performed or to be performed by the Contractor or any of the Contractor's Subcontractors in connectionwiththeOperatingAssetsortheCollectionServicesandwhichlastbeyondseven(7) daysshallnotconstituteanEventofDefaultunderSection13.1.A. 44 TheCityofRidgecrest FranchiseAgreement

C.

1307 1308 1309 1310 1311 1312 1313 1314 1315 1316 1317 1318 1319 1320

However,intheeventofsuchoccurrencewhichpreventsordiminishestheabilityofContractorto Collect,TransportandDisposeofanyoralltheSolidWasteandRecyclableMaterialswhichitis obligated under this Agreement to Collect, Transport or Dispose of for a period of more than seventytwo (72) hoursandtheCityContract Manager,in hisorherdiscretion,shouldfindthat suchaccumulationendangersormenacesthepublichealth,safetyorwelfare,thenCityshallhave theright,upontwentyfour(24)hoursnoticetoContractor,tofindtheContractorinDefaultand to contract with any other third parties to Collect and Transport any and all Solid Waste and Recyclable Materials which Contractor would otherwise be obligated to Collect and Transport pursuanttothisAgreement.Contractoragreesthatinsuchevent,itwillfullycooperatewithCity and its thirdparty contractor to effect such transfer of operations in as smooth and efficient a fashionasispracticable.Allcosts,fees,ratesorotherexpensesincurredbyCityand/oritsthird partycontractorthatexceedthosethatwouldhavebeenincurredbyCityhadnosuchemergency arisenshallbetheresponsibilityoftheContractorandshallbepaidtoCitywithinthirty(30)days ofreceiptofwrittennoticetopay.

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Section 13.4: Right to Demand Assurances of Performance


IftheCitybelievesingoodfaiththattheContractor'sabilitytoperformundertheAgreementhasbeen placedinsubstantialjeopardybyone(1)oftheeventsenumeratedbelow,theCityContractManager may, at his option and in addition to all other remedies the City may have, require that Contractor provideCityContractManagerwithsufficientproofthatnoneoftheeventsenumeratedbelowwillin factimpairContractorfromperformingitsobligationsundertheAgreement: A. Contractor is the subject of any labor unrest, including work stoppages or slowdown, sickout, picketing,orotherconcertedjobaction; Contractorappears,inthereasonablejudgmentoftheCity,tobeunabletoregularlypayitsbills astheybecomedue;or, Contractor is the subject of a civil or criminal judgment or order entered by a federal, state, regional,orlocalagencyforviolationofanenvironmentallaw.

B.

C.

If the Contractor fails or refuses to provide to the City adequate information to establish its ability to perform within thirty (30) days, such failure or refusal shall be an Event of Default for purposes of Section13.1.A.

1336 1337 1338 1339 1340 1341 1342 1343

Section 13.5: Waiver of Defenses


Inordertoinsurethenoninterruptionofavitalpublicservice,exceptasprovidedinSection13.3,the Contractor acknowledges that it is solely responsible for providing the services described herein, and hereby irrevocably waives the following defenses to the payment and performance of its obligations under this Agreement: any defense based upon failure of consideration, contract of adhesion, impossibility or impracticability of performance, commercial frustration of purpose, or the existence, nonexistence,occurrenceornonoccurrenceofanyforeseenorunforeseenfact,event,orcontingency thatmaybeabasicassumptionoftheContractorwithregardtoanyprovisionofthisAgreement.

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TheCityofRidgecrest FranchiseAgreement

1344 1345 1346 1347 1348 1349 1350 1351 1352 1353

ARTICLE 14: RESOLUTION OF DISPUTES


ShouldadisputearisewithrespecttotheperformanceandobligationsofthePartieshereunder,atany timeduringtheTermofthisAgreement,theprovisionsofthisSectionshallapply.EitherPartyshallgive theotherwrittennoticeofsuchdispute.SuchnoticeshallspecifyadateandlocationforthePartiesto meetandconferingoodfaithtoresolveanydisputethatmayarise.Intheeventsuchdisputecannotbe resolvedbythePartiesthemselveswithinthirty(30)daysofsuchnotice,eitherPartymayproposethe appointment of a mediator. If the other Party is in agreement, both Parties may refer the matter in disputetosuchmediatorforadviceandnonbindingmediation.Ifthemediatorisunable,within30days thereafter,toreachadeterminationastothematterindisputeinamanneracceptabletotheParties hereto,themattermaybereferredbyeitherPartytoaCourtofcompetentjurisdiction.

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TheCityofRidgecrest FranchiseAgreement

1354

ARTICLE 15: MISCELLANEOUS PROVISIONS


Section 15.1: Relationship of the Parties
Neither Party to this Agreement shall have any responsibility whatsoever with respect to services provided or contract obligations or liabilities assumed by the other Party hereto, whether accrued, absolute,contingentorotherwise,orwhetherdueortobecomedue.TheContractorisanindependent ContractorandAgreementholderandnothinginthisAgreementshallbedeemedtoconstituteeither Partyapartner,agentorlegalrepresentativeoftheotherPartyortocreateanyfiduciaryrelationship betweentheParties.

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1362 1363 1364 1365 1366 1367 1368 1369 1370 1371 1372 1373 1374 1375 1376 1377 1378 1379 1380 1381 1382 1383 1384

Section 15.2: Notice to Parties


AllnoticesrequiredorprovidedforinthisAgreementshallbeprovidedtothePartiesatthefollowing addresses,bypersonaldeliveryordepositintheU.S.Mail,postageprepaid,registeredorcertifiedmail, addressed as specified below. Notices delivered personally shall be deemed received upon receipt; mailedorexpressednoticesshallbedeemedreceivedfive(5)daysafterdeposit.APartymaychange theaddresstowhichnoticeisgivenbygivingnoticeasprovidedherein. ToCity: CityofRidgecrest Attn:CityManager 100W.CaliforniaAve. Ridgecrest,CA93555 ToContractor: _________________ _________________ _________________ _________________

Section 15.3: Actions of the City in its Governmental Capacity


Nothing in this Agreement shall be interpreted as limiting the rights and obligations of the City in its governmentalorregulatorycapacity,oraslimitingtherightoftheContractortobringanylegalaction against the City, not based on this Agreement, arising out of any act or omission of the City in its governmentalorregulatorycapacity.

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TheCityofRidgecrest FranchiseAgreement

1385 1386 1387

Section 15.4: Binding Effect


ThisAgreementshallbindandinuretothebenefitofthePartiesheretoandanysuccessororassignee acquiringaninteresthereunderconsistentwiththeprovisionshereof.

1388 1389 1390

Section 15.5: Amendments


NeitherthisAgreementnoranyprovisionhereofmaybechanged,modified,amendedorwaivedexcept bywrittenagreementdulyexecutedbybothParties.

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Section 15.6: Further Assurance


EachPartyagreestoexecuteanddeliveranyinstrumentsandtoperformanyactsasmaybenecessary orreasonablyrequestedbytheotherinordertogivefulleffecttothisAgreement.

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Section 15.7: Assignment and Transfer of Agreement


A. Consent of the City Required. This Agreement shall not be transferred, sold, pledged, hypothecated,leased,orassigned,norshallanyoftherightsorprivilegeshereinbetransferred, sold,pledged,hypothecated,leased,orassigned,eitherinwholeorinpart,norshalltitlehereto orthereto,eitherlegalorequitable,oranyright,interestorpropertyhereinortherein,passtoor vest in any Person, except the Contractor, either by action or inaction of the Contractor, or by operationoflaw,withoutthepriorwrittenconsentoftheCity,whichmaybewithheldordelayed initssoleandabsolutediscretion. The Contractor shall provide written notice of any request to assign or transfer this Agreement, and shall provide the City with any information requested by the City in connection with the proposed transfer, included but not limited to information regarding the general business qualificationsoftheproposedassignee,aswellasitsabilitytoperformtheCollectionServicesand a statement of its financial resources. The Contractors notice of intention to assign this Agreementshallcontainastatementoftheallocationofdollarsintheconsiderationtobepaidby the assignee to the Contractor for (a) goodwill, (b) equipment, and (c) any other asset transfer which has any connection with said assignment, all as agreed upon by the Contractor and the assignee. The notice shall also contain a statement showing the method of payment for the considerationandwhethertheContractorproposestoholdsomesecurityinterestassecurityfor thepaymentoftheunpaidbalanceoftheconsideration. TheCityshallrespondtoanysuchrequestwithinninety(90)daysafterreceiptofanyinformation requested by the City pursuant to the preceding sentence. The Contractor acknowledges that, priortoapprovingsuchatransfer,theCitymustfindthatsuchatransferisinthebestinterestsof thepublichealth,safety,andgeneralwelfare.AnyattemptbytheContractortoeffectuateanyof theforegoingwithoutsuchconsentoftheCityshallbenullandvoid,andanyeffectuationofany oftheforegoingwithoutsuchconsentoftheCityshallconstituteanEventofDefaultresultingin theimmediateterminationofthisAgreementasprovidedinSection13.1.Ahereof. 48 TheCityofRidgecrest FranchiseAgreement

1420 1421 1422 1423 1424 1425 1426 1427 1428 1429 1430 1431 1432 1433 1434 1435 1436 1437 1438 1439 1440 1441 1442 1443 1444 1445 1446 1447 1448 1449 1450 B.

Any transfer of this franchise shall constitute the granting of a new franchise for purposes of MunicipalCodeSections35.104and35.105.Inadditiontotheproceduralrequirementsofthis Section,anytransferissubjecttotheproceduralrequirementsoftheseportionsoftheMunicipal Code. Furthermore, any assigned or transferred franchise is subject to the term limitations of Municipal Code Section 35.106 as calculated from the original date of the granting of this franchise. Consolidation,Merger,Sale,Transfer,andChangeinControl.Subjecttotheprovisionsofsection 3.7.Aabove,theContractorshallnot,withoutthepriorwrittenconsentoftheCitywhichmaybe withheld or delayed in its sole and absolute discretion, consolidate with or merge with another entityorpermitone(1)ormoreotherentitiestoconsolidatewithormergeintoit. TransferofVotingStock.TheCity'spriorwrittenconsent,whichmaybewithheldordelayedinits soleandabsolutediscretion,shallberequiredforthesaleortransferbyanymeans,whetherby agreement or by operation of law (including transfers resulting from death, bankruptcy or divorce),ofanyofthevotingstockoftheContractor. ReimbursementofCostRelatedtoAssignmentReview.IftheContractorrequeststheconsentof the City for any transaction described in Section 15.7 hereof, the proposed assignee, as a conditionofassignment,shallreimbursetheCityforallcostsandexpensesincurredbytheCityin reviewing, examining, and analyzing the request, including all direct and indirect administrative expenses of the City and consultants and attorneys fees and expenses. Along with its written requestforthereviewoftheassignment,ContractorshallremittoCityanassignmentreviewfee in the amount of one hundred thousand dollars ($100,000) which shall be intended to compensatetheCityofthecostsofitsreviewoftherequestedassignment.Suchfeeshallnotbe refundabletotheContractorintheeventthattheCitydetermines,initssolediscretion,thatthe proposedassignmentisunacceptable.IntheeventthattheCitystotalcostsforthereviewofthe assignmentexceedonehundredthousanddollars($100,000)theassigneeshallcompensatethe Cityforitsactualandreasonablecostswithinthirty(30)daysofreceivingtheCitysinvoice.Such costsshallbesupportedwithevidenceoftheexpenseorcostincurred. TransferFee.OnthedatetheCityapprovestheContractorswrittenrequestforanassignment, ContractorshallpaytheCityatransferfeeintheamountofone(1)percentoftheGrossReceipts forthemostrecentlycompletedRatePeriod.TheCitysapprovalofsuchanassignmentshallbe conditionedonthereceiptofthetransferfee.

C.

D.

E.

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Section 15.8: Interpretation


InthisAgreement,unlessthecontextotherwiserequires: A. References Hereto. The terms "hereby," "hereof," "herein," hereunder," and any similar terms refertothisAgreement,andtheterm"hereafter"meansafter,andtheterm"heretofore"means before,thedateofexecutionofthisAgreement. GenderandPlurality.Wordsofthemasculinegendermeanandincludecorrelativewordsofthe feminine and neuter genders, and words importing the singular number mean and include the pluralnumberandviceversa. 49 TheCityofRidgecrest FranchiseAgreement

B.

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C.

Persons. Words importing Persons include firms, companies, associations, general partnerships, limitedpartnerships,trusts,businesstrusts,corporations,nonprofitcorporations,andotherlegal entitles,includingGovernmentalBodies,aswellasindividuals. Headings.Thetableofcontentsandanyheadingsprecedingthetextofthearticles,sections,and subsectionsofthisAgreementshallbesolelyforconvenienceofreferenceandshallnotconstitute apartofthisAgreement,norshalltheyaffectitsmeaning,construction,oreffect. Entire Agreement. This Agreement contains the entire agreement between the Parties hereto with respect to the transactions contemplated by this Agreement. Furthermore, nothing in this AgreementisintendedtoconferonanyPersonotherthanthePartiesheretoandtheirrespective successorsandassignshereunderanyrightsorremediesunderorbyreasonofthisAgreement. Reference to Days. All references to days herein are to calendar days, including Saturdays, Sundays,andholidays,exceptasotherwisespecificallyprovided. UnitsofMeasure.WeightsorvolumesdescribedhereinmaybereportedineithermetricorU.S. Standardtermsofmeasurement,unlessStateorFederallaworregulationspecifiesthesystemof measurementtobeused. Counterparts.ThisAgreementmaybeexecutedinanynumberoforiginalcounterparts.Allsuch counterpartsshallconstitutebutoneandthesameAgreement. Applicable Law. This Agreement shall be governed by and construed in accordance with Applicable Law. This Agreement is intended to be fully consistent with the requirements of the Ridgecrest Municipal Code and any subsequent amendments thereto. In the event there is an inconsistencyorconflictbetweenthisAgreementandtheMunicipalCode,theMunicipalCodeis controllingandshallsubstitutefortheinconsistentprovision. Severability. If any clause, provision, subsection, section, or article of this Agreement shall be determinedtobeinvalidbyanycourtofcompetentjurisdiction,thenthePartiesheretoshall: 1. Promptly meet and negotiate a substitute for such clause, provision, section, or article which shall, to the greatest extent legally permissible, effect the intent of the Parties therein. If necessary or desirable to accomplish item (1) above, apply to the court having declared suchinvalidityforajudicialconstructionoftheinvalidatedportionofthisAgreement. Negotiatesuchchangesin,substitutionsfororadditionsto,theremainingprovisionsofthis Agreement as may be necessary in addition to and in conjunction with items (1) and (2) above, to effect the intent of the Parties in the invalid provision. The invalidity of such clause, provision, subsection, section, or article shall not affect any of the remaining provisions hereof, and this Agreement shall be construed and enforced as if such invalid portiondidnotexist.

D.

E.

F.

G.

H.

I.

J.

2.

3.

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TheCityofRidgecrest FranchiseAgreement

1494 1495 1496 1497 1498

Section 15.9:Jurisdiction
AnylawsuitsbetweenthePartiesarisingoutofthisAgreementshallbebroughtandconcludedinthe courts of Kern County in the State of California, which shall have exclusive jurisdiction over such lawsuits.Withrespecttovenue,thePartiesagreethatthisAgreementismadeinandwillbeperformed inKernCounty.

1499 1500 1501 1502 1503 1504 1505

Section 15.10: Entire Agreement


This Agreement, including the Exhibits, represents the full and entire Agreement between the Parties withrespecttothematterscoveredherein.EachoftheExhibitsidentifiedasExhibits"A"throughGis attachedheretoandincorporatedhereinandmadeaparthereofbythisreference. INWITNESSWHEREOF,thePartieshaveexecutedthisAgreementonthedatesstatedbelow: {InsertCityAttorneyApprovedSignatureBlock}

51

TheCityofRidgecrest FranchiseAgreement

EXHIBIT A DEFINITIONS
For purposes of this Agreement, unless a different meaning is clearly required, the following words and phrases shall have the following meanings respectively ascribed to them by this Exhibit and shall be capitalized throughout this Agreement: AB 939" means the California Integrated Waste Management Act of 1989 (Division 30 of the California Public Resources Code), also commonly referred to as "AB 939," as amended, supplemented, superseded, and replaced from time to time. Administrative Fee means the quarterly fee used to offset expenses including staffing costs related to contract management, compliance, monitoring, and to enforce the Agreement with respect to any violations by third parties, including initiating and/or assisting in prosecuting enforcement actions. Affiliate(s) means any person, corporation or other entity directly or indirectly controlling or controlled by another person, corporation or other entity, or under direct or indirect common management or control with such person, corporation or other entity. As between any two (2) or more persons or entities, when ten percent (10%) of one is owned, managed, or controlled by another, they are hereunder Affiliates of one another. "Agreement" means this Solid Waste Management Agreement between the City and the Contractor. "Agreement Date" means the date of approval of this Solid Waste Management Agreement by the City. "Agreement Year" means a twelve-month period beginning on January 1 of each year and ending on the following December 31 each year during the Term of this Agreement, provided however, that the first Agreement Year will commence on the Agreement Date and the last Agreement Year will end on the date of termination of this Agreement. Annual Percentage Change means the average value of an index for the 12-month period ending December of the then-current Rate Period minus the average index value for the 12-month period ending December of the most-recently completed Rate Period, divided by the average index value for the 12-month period ending December of the most-recently completed Rate Period. The Annual Percentage Change shall be rounded to the nearest thousandth (1,000th). For example, if the Contractor is preparing its Rate application for Rates to be effective for Rate Period 2, the Annual Percentage Change in CPI shall be calculated as follows: [(Average CPI for January 2015 through December 2015) (Average CPI for January 2014 through December 2014)] / (Average CPI for January 2014 through December 2014)]. "Applicable Law" means any law, rule, regulation, requirement, guideline, permit, action, determination, or order of any Governmental Body having jurisdiction, applicable from time to time to the Collection Services; the Operating Assets; the siting, design, acquisition, permitting, construction, equipping, financing, Ownership, possession, shakedown, testing, operation, or maintenance of any of the Operating Assets; or any other transaction or matter contemplated hereby (including any of the
PRELIMINARY DRAFT Franchise Agreement, Exhibit A Page A-1

EXHIBIT A DEFINITIONS
foregoing which concern health, safety, fire, governmental protection, accommodation of the disabled, labor relations, mitigation monitoring plans, building codes, non-discrimination and the payment of minimum wages, and further including the Kern County Code and the County Integrated Waste Management Plan and the Citys SRRE). Approved Recyclable Materials Processing Facility Means the {insert facility name} located at {insert facility address}. "Base Rate" means the Rate charged for basic Collection Service of Solid Waste including Recyclable Materials in a specified area, as authorized by the City, absent any discounts offered by the Contractor as specified in Appendix 2. Bureau of Labor Statistics (BLS) shall mean the U.S. Department of Labor, Bureau of Labor Statistics or its successor agency. Bin means a Container with capacity of approximately one (1) to six (6) cubic yards, with a hinged lid, and with wheels (where appropriate), that is serviced by a front end-loading collection Vehicle. "Bulk Container" means a Container or Bin having a capacity of 1.0 or more cubic yards. "Bulky Waste" means large and small household appliances, furniture, tires, carpets, mattresses, and similar large items of Solid Waste which cannot be contained within a standard Container, or which does not fit in or causes harm to collection Vehicles. Business Days mean days during which the City offices are open to do business with the public. CalRecycle means the Department of Resources Recycling and Recovery, and any Governmental Body which succeeds to its duties and powers under Applicable Law. Cart means a plastic Container with a hinged lid and wheels that is serviced by an automated or semiautomated Collection vehicle. A Cart has capacity of 96 gallons (or similar volumes). "CEQA" means the California Environmental Quality Act codified at California Public Resources Code Section 21000 et seq., as amended or superseded, and the regulations promulgated thereunder. "Change in Law" means any of the following events or conditions which has a material and adverse effect on the performance by the Contractor of the Collection Services (except for payment obligations): The enactment, adoption, promulgation, issuance, modification, or written change in administrative or judicial interpretation on or after the Agreement Date of any Applicable Law; or, The order or judgment of any Governmental Body, on or after the Agreement Date. to the extent such order or judgment is not the result of willful or negligent action, error or omission or lack of reasonable diligence of the City or of the Contractor, whichever is asserting the
Franchise Agreement, Exhibit A Page A-2

PRELIMINARY DRAFT

EXHIBIT A DEFINITIONS
occurrence of a Change in Law provided, however, that the contesting in good faith or the failure in good faith to contest any such order or judgment shall not constitute or be construed as such a willful or negligent action, error or omission or lack of reasonable diligence. "City" means the City of Ridgecrest, California, a political subdivision of the State, acting through its City Council. "City Contract Manager" means the City Manager or their designated representative who is responsible for the administrative management of this Agreement. City Fees shall mean those fees described in Section 3.4of this Agreement. Collect or Collection (or any variation thereof) means the act of collecting Solid Waste and Recyclable Materials at the place of generation in the City of Ridgecrest. "Collection Premises" means the Residential Premises, Non-Residential Premises, or both for which the Contractor is authorized to provide Collection Services. "Collection Services" means all of the duties and obligations of the Contractor hereunder. Commercial shall mean of, from or pertaining to non-Residential Premises where business activity is conducted, including, but not limited to, retail sales, services, wholesale operations, manufacturing, and industrial operations, but excluding businesses conducted upon Residential property, which are permitted under applicable zoning regulations and are not the primary use of the property. For the purposes of this Agreement, Commercial also includes Multiple-Unit Dwellings with five (5) or more units. Compactor means a mechanical apparatus that compresses materials together with the Container that holds the compressed materials or the Container that holds the compressed materials if it is detached from the mechanical compaction apparatus. Compactors include two (2) to eight (8) cubic yard Bin Compactors serviced by front-end loader Collection Vehicles and ten (10) to fifty (50) cubic yard Drop Box Compactors serviced by roll-off Collection Vehicles. Consumer Price Index (CPI) shall mean the All Urban Consumers Index (CPI-U) compiled and published by the BLS, using the following parameters: Area San Francisco-Oakland-San Jose Metropolitan Area Item All Items Base Period Current 1982-84=100 Not seasonally adjusted Periodicity Bi-Monthly Series Identification Number CUURA422SA0

Container(s) mean Bins, Carts, Compactors, and Drop Boxes.


PRELIMINARY DRAFT Franchise Agreement, Exhibit A Page A-3

EXHIBIT A DEFINITIONS
Contractor means Contractor organized and operating under the laws of the State and its officers, directors, employees, agents, companies, related-parties, affiliates, subsidiaries, and Subcontractors. "County" means the County of Kern, California, a political subdivision of the State, acting through its Board of Supervisors. "Customer" means Person who subscribes for service with Contractor. Customer Type means the Customers sector category including, but not limited to, Residential, Commercial and City Facilities. Designated Collection Location" refers to the location, at each Collection Premises where Containers of Solid Waste and Recyclable Materials are customarily placed for collection, all in accordance with Section 4.5 herein. Designated Disposal Facility" means the facility designated by the City Contract Manager to which the Contractor shall transport Solid Waste and Residual Waste. Dispose or Disposal (or any variation thereof) means the final disposition of Solid Waste at a Disposal site. Drop Box means an open-top Container with a capacity of ten (10) to fifty (50) cubic yards that is serviced by a roll-off Collection Vehicle. Electronic Waste (E-Waste) means discarded electronic equipment including, but not limited to, televisions, computer monitors, central processing units (CPUs), laptop computers, computer peripherals (including external hard drives, keyboards, scanners, and mice), printers, copiers, facsimile machines, radios, stereos, stereo speakers, VCRs, DVDs, camcorders, microwaves, telephones, cellular telephones, and other electronic devices. Some E-Waste or components thereof may be Hazardous Waste and thus require special handling, Processing, or Disposal. "Emergency Services" means Solid Waste Collection Services, other than those specified under this grant of Agreement, provided during or as a result of an emergency which threatens the public health or safety, as determined by the City Contract Manager. Employment Cost Index (ECI) shall mean the index, compiled and published by the BLS with the following parameters: Compensation Total Compensation Ownership Private Industry Periodicity Index Number Group 210 - Service-Providing Industries Seasonally Adjusted
Franchise Agreement, Exhibit A Page A-4

PRELIMINARY DRAFT

EXHIBIT A DEFINITIONS
Event of Default means only the events described in Sections 7.4 and 12.1.A. Excluded Waste means Hazardous Waste, Infectious Waste, U-Waste, E-Waste, volatile, corrosive, biomedical, infectious, biohazardous, and toxic substances or material, waste that Contractor reasonably believes would, as a result of or upon Disposal, be a violation of local, State or Federal law, regulation or ordinance, including land use restrictions or conditions, waste that cannot be Disposed of in Class III landfills, waste that in Contractors reasonable opinion would present a significant risk to human health or the environment, cause a nuisance or otherwise create or expose Contractor or City to potential liability; but not including de minimis volumes or concentrations of waste of a type and amount normally found in Residential Solid Waste after implementation of programs for the safe Collection, Recycling, treatment, and Disposal of batteries and paint in compliance with Sections 41500 and 41802 of the California Public Resources Code. Franchise Fee means the fee paid by Contractor to the City for the privilege to hold the rights granted by this Agreement. Fuel Index shall mean the Producer Price Index-Commodities for #2 Diesel Fuel compiled and published by the BLS, using the following parameters: Not Seasonally Adjusted Group Fuels and Related Products and Power Item #2 Diesel Fuel Base Date 8200

"Generator means any person that generates, produces, or discards Solid Waste and Recyclable Materials. "Governmental Body" means any federal, state, county, city or regional legislative, executive, judicial or other governmental board, agency, authority, commission, administration, court or other body, or any officer thereof acting within the scope of his or her authority. Governmental Fee shall mean any fee or surcharge imposed by a governmental entity other than the City including without limitation the State, County, or Local Enforcement Agency. Governmental Fees are a component of the Tipping Fee. "Greenwaste" means grass, lawn clippings, shrubs, plants, weeds, small branches and other forms of organic materials generated from landscapes or gardens, separated from other Solid Waste. Gross Receipts shall mean total cash receipts collected from Customers by the Contractor for the provision of services pursuant to this Agreement, without any deductions. Gross Receipts do not include revenues from the sale of Recyclable Materials.

PRELIMINARY DRAFT

Franchise Agreement, Exhibit A Page A-5

EXHIBIT A DEFINITIONS
"Hazardous Waste" means: A. Any waste which by reason of its quality, concentration, composition, or physical, chemical, or infectious characteristics may do either of the following: cause, or significantly contribute to, an increase in mortality or an increase in serious irreversible, or incapacitating reversible, illness, or pose a substantial threat or potential hazard to human health or the environment when improperly treated, stored, transported, or disposed of, or otherwise mismanaged, or any waste which is defined or regulated as a Hazardous Waste, toxic substance, hazardous chemical substance or mixture, or asbestos under Applicable Law, as amended from time to time, including, but not limited to: 1. 2. 3. 4. 5. B. The Resource Conservation and Recovery Act and the regulations contained in 40 CFR Parts 260-281. The Toxic Substance Control Act (L5 U.S.C. Section 2601 et seq.) and the regulations contained in 40 CFR Parts 761-766. The California Health & Safety Code Section 25117 (west 1992 & Supp. 1998). The California Public Resources Code Section 40141 (West 1996). Future additional or substitute federal, state or local laws pertaining to the identification, treatment, storage, or disposal of toxic substances or Hazardous Wastes.

Radioactive materials which are source, special nuclear, or by-product material as defined by the Atomic Energy Act of 1954 (42 U.S.C. Section 2011 et seq.) and the regulations contained in 10 CFR Part 40.

"Household Hazardous Waste" means waste materials determined by CalRecycle, the Department of Toxic Substances Control, the State Water Resources Control Board, or the Air Resources Board to be: A. B. C. Of a nature that they must be listed as hazardous in State statutes and regulations; Toxic/ignitable/corrosive/reactive; and, Carcinogenic/mutagenic/teratogenic

which are discarded from Residential Premises as opposed to businesses. Household Hazardous Waste shall not include unacceptable waste. Infectious Waste means biomedical waste generated at hospitals, public or private medical clinics, dental offices, research laboratories, pharmaceutical industries, blood banks, mortuaries, veterinary facilities and other similar establishments that are identified in Health and Safety Code Section 25117.5 as may be amended from time to time.

PRELIMINARY DRAFT

Franchise Agreement, Exhibit A Page A-6

EXHIBIT A DEFINITIONS
"Insurance Requirement" means any rule, regulation, code, or requirement issued by any fire insurance rating bureau or anybody having similar functions or by any insurance company which has issued a policy with respect to the Operating Assets or the Collection Services. "Legal Proceeding" means every action, suit, litigation, arbitration, administrative proceeding, and other legal or equitable proceeding having a bearing upon this Agreement. Line of Business means any of the following services provided by the Contractor: Residential Solid Waste, Residential Recycling, Commercial Solid Waste, Commercial Recycling, Liquid Waste" means watered or dewatered sewage or sludge. Liquidated Damages means the amounts due by Contractor for failure to meet specific quantifiable standards of performance as described in Section 12.2. "Medical Waste" means waste capable of producing an infection or pertaining to or characterized by the presence of pathogens, including without limitation certain wastes generated by medical practitioners, hospitals, nursing homes, medical testing labs, mortuaries, taxidermists, veterinarians, veterinary hospitals and medical testing labs, and waste which includes animal wastes or parts from slaughterhouses or rendering plants. "Multiple-Unit Dwelling" means any building in the City, other than a Single-Unit Dwelling, lawfully occupied for human shelter. "Municipal Code" means the Citys Codified Ordinances, as the same may be amended, supplemented, or modified from time to time. "Non-Residential Premises" means those parcels of real property not classified under the use codes listed in the Schedule of Solid Waste Management Program Service Charges for Residential Property, attached hereto as Appendix 3, and made a part hereof, as amended by the City Council from time to time. "Non-Residential Waste" means Solid Waste and Recyclable Materials generated, produced, or discarded by or at Non-Residential Premises. "Operating Assets" means all real and personal property of all kind, which is owned, leased, managed, or operated by or under contract to the Contractor for providing the Collection Services, including without limitation the Containers, Vehicles, Transfer stations, maintenance and storage facilities, administrative facilities, and other equipment, machinery, parts, supplies and tools. "Owner" means the person holding the legal title or having a right to possession of the real property constituting the Collection Premises to which Solid Waste and Recyclable Materials Collection Service is provided or required to be provided hereunder.
PRELIMINARY DRAFT Franchise Agreement, Exhibit A Page A-7

EXHIBIT A DEFINITIONS
Party or Parties refers to the City and Contractor, individually or together. Pass-Through Cost means those City Fees, Tipping Fees, Governmental Fees, and other costs, as specifically identified in Exhibit B, that Contractor may include in the determination of Contractors Compensation but which are not included in the calculation of Contractors allowable profit. Person(s) means any individual, firm, association, organization, partnership, corporation, trust, joint venture, or public entity. Premises means any land or building in the City where Solid Waste and Recyclable Materials are generated or accumulated. "Process" or "Processing" refers to the removal of Recyclable Materials from Solid Waste prior to the delivery of such Solid Waste to the Designated Disposal Facility. "Processing Facility" refers to any facility that removes Recyclable Materials from Solid Waste and Recyclable Materials prior to the delivery of Solid Waste and Recyclable Materials to the City Disposal System. Rate means the maximum amount, expressed as a dollar unit, approved by the City that the Contractor may bill a Customer for providing services under this Agreement. A Rate has been established for each individual Service Level and the initial Rates for Rate Period One are presented in Exhibit C3. The Rates approved by City are the maximum Rate that Contractor may charge a Customer and Contractor may, in its sole discretion, charge any amount up to and including the maximum Rate approved by the City. Rate Adjustment Factor shall mean the amount, expressed as a percentage, by which each of the operating, disposal, processing, and fee components of each Rate are adjusted. The Rate Adjustment Factor for each component shall be calculated separately. Rate Period means a twelve (12) month period, commencing July 1 and concluding June 30, excepting Rate Period One. Rate Period One means the first Rate Period covered by this Agreement. Rate Period One shall begin on January 1, 2012 and shall end on June 30, 2013. "Recovered Materials" means the products, excluding Residual Waste, produced by the Processing of Recyclable Materials. "Recyclable Materials" means cardboard, paper, plastic, glass, aluminum or other metal materials having economic value contained within a load of Recyclable Materials, and may also include any other type of recyclable waste material agreed on by the Parties. {Proposer This list will be updated to include the specific materials accepted at the Recyclable Materials Processing Facility.}

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Franchise Agreement, Exhibit A Page A-8

EXHIBIT A DEFINITIONS
"Recycle," "Recycled," or "Recycling" means the Process of collecting, sorting, cleansing, treating, reconstituting, or otherwise Processing materials that are or would otherwise become Solid Waste and returning them to the economic mainstream in the form of raw material for new, reused, or reconstituted products which meet the quality standards necessary to be used in the marketplace. "Recycling Plan" is the Contractors recycling plan presented in Exhibit C6. Residential shall mean of, from, or pertaining to a Single-Unit Dwelling Premises or Multi-Unit Dwelling Premises including Single-Family homes, apartments, condominiums, townhouse complexes, mobile home parks, and cooperative apartments. Residual Waste" means any material remaining after the Processing, by any means and to any extent of Solid Waste and Recyclable Materials. "Roll-Off" means Solid Waste pick-ups using Bulk Containers mounted on rail wheels or similar wheels and using special trucking equipment for transporting the Bins and Containers. "Routing and Collection System" means the Routing and Collection System for Solid Waste and Recyclable Materials which is in effect as of the effective date of this Agreement. "Scrap Materials" means any materials which are separated by type of Generator thereof from materials which otherwise are discarded or rejected by the Generator as Solid Waste and Recyclable Materials and which are sold or donated by the Generator to a private Recycler, scrap dealer, or salvager and Recycled. Scrap Materials shall not include any materials which (1) are commingled with Solid Waste and Recyclable Materials, or (2) are not commingled with Solid Waste and Recyclable Materials, but which are collected by any person other than the Contractor as part of any transaction or arrangement involving Solid Waste and Recyclable Materials, irrespective of whether the Generator pays or receives consideration in connection with such transaction or arrangement. Service Level refers to the size of a Customers Container and the frequency of Collection Services. "Single-Unit Dwelling" means a dwelling designed for or occupied exclusively for human shelter by one (1) family. "Single-Unit Container" means a Container of ninety-six (96) gallon capacity or less, usually used by a Single-Unit Dwelling or a small business, for Solid Waste and Recyclable Materials. "Solid Waste" means all garbage, refuse, rubbish, and other materials and substances discarded or rejected as being spent, useless, worthless, or in excess to the Generator thereof at the time of such discard or rejection and which are normally discarded by or collected from Residential Premises, NonResidential Premises and institutional establishments, which are acceptable at Class III landfills under Applicable Law, and which are originally discarded by the first Generator thereof and have not been previously Processed. Solid Waste includes Greenwaste, but does not include Hazardous Waste, Medical
PRELIMINARY DRAFT Franchise Agreement, Exhibit A Page A-9

EXHIBIT A DEFINITIONS
Waste, Liquid Waste, Scrap Materials, construction and demolition debris, or self-hauled waste. Solid Waste includes only those materials which were originally discarded by the first Generator thereof, prior to any Processing at any Collection Premises within the City. "Special Circumstance" means a circumstance which, when occurring, permits, but does not require the Contractor or the City to seek an adjustment in the Rates for Service, and which then requires City Contract Manager to review such application and make a recommendation to the City Council as to whether the Base Rate should be adjusted up or down, or remain unchanged. The continuing need for any and all previously-approved Special Circumstance Rate adjustments shall be reviewed at the time of each subsequent Rate adjustment. "Special Service" means a level of Solid Waste Collection Service in excess of that offered by the Contractor as its basic level of service, at an additional cost to the Customer and may include, but is not limited to, backyard pickup, additional Containers, or more frequent collections. "Special Service" does not mean the reasonable accommodation of an individual with a disability. The charge for any Special Service shall be reviewed by the City Contract Manager and may require a public hearing and the approval of the City Council. "SRRE" means the City's Source Reduction and Recycling Element approved by CalRecycle, as the element may be amended from time to time, all in accordance with AB 939 and regulations related thereto, as they may be amended from time to time. "Subcontractor" means every person (other than employees of the Contractor) employed or engaged by the Contractor or any person directly or indirectly in privity with the Contractor (including every Subcontractor of whatever tier) for any portion of the Collection Services, whether for the furnishing of labor, materials, equipment, supplies, services, or otherwise. Term means the Term of this Agreement, including extension periods if granted, as provided for in Section 3.2. Tipping Fee shall mean the Rate or Tipping Fee charged for each Ton or unit of material delivered to the Designated Disposal Facility or the Approved Recyclable Materials Processing Facility. The Parties acknowledge that the timing of changes to the Tipping Fees that are not owned or operated by Contractor or their subcontractor may not align with the review and adjustment of Rates under this Agreement. In the event that the Contractor begins to pay new Tipping Fees at another facility approved by the City, other than one owned and operated by Contractor or their Subcontractor, prior to the adjustment of Rates under this Agreement, the adjustment to the Rate Adjustment Factor shall consider that period. Alternatively, the City reserves the right to adjust Rates at any time during the year in order to address changes in Tipping Fees alone without adjusting any other component of Rates. The current approved Tipping Fees shall be the Tipping Fees in place on January 1 immediately preceding the submission of the Rate Application.

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Franchise Agreement, Exhibit A Page A-10

EXHIBIT A DEFINITIONS
Ton or Tonnage means a unit of measure for weight equivalent to two thousand (2,000) standard pounds where each pound contains sixteen (16) ounces. Total Contractors Compensation shall mean the total amount to be used as a basis for determining the Rate Adjustment Factor. The Total Contractors Compensation does not reflect or in any way guarantee the Gross Receipts that are to be generated by Rates or retained by the Contractor. Transfer means the act of transferring the materials Collected by Contractor in their route vehicles into larger vehicles for Transport to other facilities for the purpose of Recycling or Disposing of such materials. Transport or Transportation (or any variation thereof) means the act of conveyance from one place to another or state of being Transported. Uncontrollable Circumstance means only one (1) or more of the following specified acts, events, or conditions, whether affecting the Operating Assets, the approved Processing Facility, the Designated Disposal Facility, the City, or the Contractor, to the extent that it materially and adversely affects the ability of the Contractor to perform any obligation under the Agreement (except for payment obligations), if such act, event or condition is beyond the reasonable control, and is not also the result of the willful or negligent act, error, or omission or failure to exercise reasonable diligence on the part of the Contractor, provided however, that the contesting in good faith or the failure in good faith to contest such action or inaction shall not be construed as willful or negligent action or a lack of reasonable diligence of the Contractor: A. An act of God (but not including reasonably anticipated weather conditions for the City), hurricane, landslide, lightning, earthquake, fire, explosion, flood, sabotage or similar occurrence, acts of a public enemy, extortion, war, blockade or insurrection, riot or civil disturbance. A Change in Law (as defined herein). Preemption of materials or services by a Governmental Body in connection with a public emergency or any condemnation or other taking by eminent domain of any portion of the Operating Assets. The first seven (7) days of a strike, work stoppage, or other labor dispute or disturbance occurring with respect to any activity performed or to be performed by the Contractor or any of the Contractor's Subcontractors in connection with the Operating Assets or the Collection Services, provided the Contractor has implemented a contingency plan satisfactory to the City Contract Manager.

B. C.

D.

It is specifically understood that only the acts or conditions specified above shall constitute Uncontrollable Circumstances. Without limiting the generality of the foregoing, the Parties acknowledge that none of the following acts or conditions shall constitute Uncontrollable Circumstances:

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Franchise Agreement, Exhibit A Page A-11

EXHIBIT A DEFINITIONS
1. 2. 3. 4. 5. General economic conditions, interest or inflation rates, currency fluctuations or changes in the cost or availability of fuel, commodities, supplies, or equipment; Changes in the financial condition of the City, the Contractor, or any of its Affiliates, or any Subcontractor affecting their ability to perform their obligations; The consequences of errors, neglect, or omission by the Contractor, any of its Affiliates, or any Subcontractor of any tier in the performance of the Collection Services; The failure of the Contractor to secure patents or licenses in connection with the technology necessary to perform its obligations hereunder; Union work rules, requirements, or demands which have the effect of increasing the number of employees employed in connection with the Operating Assets, or otherwise increase the cost to the Contractor of operating and maintaining the Operating Assets or providing the Collection Services; Any strikes, work stoppages, or other labor disputes or disturbances occurring with respect to any activity performed or to be performed by the Contractor or any of the Contractor's Subcontractors in connection with the Operating Assets or the Collection Services and which last beyond seven (7) days; Any failure of any Subcontractor to furnish labor, materials, service, or equipment for any reason; Vehicle or equipment failure; Any impact of prevailing wage law, customs, or practices on the Contractor's construction or operating costs; or, Any act, event, or circumstance occurring outside of the United States.

6.

7. 8. 9. 10.

Universal Waste (U-Waste) means all wastes as defined by Title 22, Subsections 66273.1 through 66273.9 of the California Code of Regulations. These include, but are not limited to, batteries, fluorescent light bulbs, mercury switches, and E-Waste. "Vehicle" means any truck, rolling stock, or other Vehicle used by the Contractor in connection with Collection Services.

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Franchise Agreement, Exhibit A Page A-12

EXHIBIT B RATE ADJUSTMENT METHODOLOGY


General Subject to the terms herein, the Contractor shall be entitled to an annual adjustment of all Rates. Each Rate, excluding special charges, includes an Operating Component, Disposal Component, Processing Component, and Fee Component, which are annually adjusted. Contractor shall submit its calculation of a Rate adjustment to the City Contract Manager on or before April 1 of each Rate Period where Rates will be adjusted using the index-based methodology. Contractor shall submit its calculations on or before February 1 for any Rate Period where Rates will be adjusted using the cost-based methodology. Contractors Rate calculations shall include all supporting schedules, documentation of Disposal or Processing Facility Tipping Fee changes, documentation of changes in Governmental Fees, and any other documentation or evidence determined by the City Contract Manager to be reasonably necessary to ensure that the calculation of Rate adjustments has been performed in strict conformance to the requirements of this Exhibit B. The City Council shall make a good faith effort to approve Rates by June 1 of each year, and such Rates shall be effective on each subsequent July 1. If Rates are not effective by July 1 due to a delay caused solely by the City, City shall allow Contractor to retroactively bill Customers for the amount of the Rate increase for any period of said delay that is solely caused by the City. If Rates are not effective by July 1 as a result of Contractors delay in submitting the Rate calculations in a complete and accurate form, then prior Rates remain in effect until such adjustment is made.

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Franchise Agreement, Exhibit B Page B-1

EXHIBIT B1 MULTI-INDEX RATE ADJUSTMENT METHODOLOGY


General The multi-index Rate adjustment methodology involves adjusting: (1) the operating component of Rates for the current Rate Period by the CPI, ECI, and Fuel Index; and, (2) the disposal, processing, and fee components of the Rates by the actual changes to those components, to determine the Rates for the coming Rate Period. The intent of performing the multi-index-based adjustment is to allow Contractors Compensation to be adjusted throughout the Term of this Agreement (giving consideration to those specific cost categories of fuel and labor that may be more volatile than the CPI) using simple, readily available surrogates for the actual changes in Contractors costs for providing service. If the ECI, CPI, or Fuel Index is/are discontinued or revised during the Term by the BLS, such other government index or computation with which it is replaced shall be used in order to obtain substantially the same result as would be obtained if said index had not been discontinued or revised. Calculation Contractor shall calculate the adjustment to its Rates using the following methodology: Step 1: Calculate the Operating Component Factor or OCF. Step 1a: Determine the Labor-Related Factor of the OCF by calculating the Annual Percentage Change in the ECI. The factor shall be rounded to the nearest tenth (percent (0.1%). Step 1b: Determine the Fuel Factor of the OCF by calculating the Annual Percentage Change in the Fuel Index. The factor shall be rounded to the nearest tenth percent (0.1%). Step 1c: Determine the Other Factor of the OCF by calculating the Annual Percentage Change in the CPI. The factor shall be rounded to the nearest tenth percent (0.1%). Step 1d: Determine the OCF, rounded to the nearest tenth percent (0.1%), as follows {Highlighted values below are presented for illustration purposes only. Values should be replaced prior to contract execution to reflect Contractors Proposal.}: OCF = (30% x Labor-Related Factor calculated in Step 1a above) + (7% x Fuel Factor calculated in Step 1b above) + (63% x Other Factor calculated in Step 1c above) For example, assuming: 1. Proposed labor-related costs are 30% of proposed total annual operating costs. 2. Proposed fuel costs are 7% of proposed total annual operating costs. 3. Proposed other costs are 63% of proposed total annual operating costs. 4. Labor-Related Factor = 3% (calculated in Step 1a) 5. Fuel Factor = 17% (calculated in Step 1b) 6. Other Factor = 1% (calculated in Step 1c) 7. OCF = (30% x 3%) + (7% x 17%) + (63% x 1%) = 0.0272 = 2.7%
PRELIMINARY DRAFT Franchise Agreement, Exhibit B1 Page B1-1

EXHIBIT B1 MULTI-INDEX RATE ADJUSTMENT METHODOLOGY


Step 2: Calculate the adjusted Operating Component, rounded to the nearest cent, for each Rate as follows: Adjusted Operating Component = Then-current Operating Component x (1 + OCF) For example, assuming: 1. Then-current Operating Component = $50.00 2. OCF = 2.7% 3. Adjusted Operating Component = $50.00 x (1 + 0.027) = $51.35 Step 3: Calculate the adjusted Disposal Component, rounded to the nearest cent, for each Rate to reflect any percentage change in the Tipping Fee charge at the approved Disposal Facility. This step 3 shall only be applied to Solid Waste Rates. The adjustment shall be calculated as follows: Adjusted Disposal Component = Then-current Disposal Component x (Current approved Disposal Facility Tipping Fee / prior approved Disposal Facility Tipping Fee) For example, assuming: 1. Then-current Disposal Component = $20.00 2. Current approved Disposal Facility Tipping Fee = $50.00 per Ton 3. Prior approved Disposal Facility Tipping Fee = $46.25 per Ton 4. Adjusted Disposal Component = $20.00 x ($50.00 / $46.25) = $21.62 Step 4: Calculate the adjusted Processing Component, rounded to the nearest cent, for each Rate to reflect any percentage change in the Tipping Fee charge at an approved Processing Facility. This step 4 shall not be applied to Solid Waste Rates. The processing component Rate Adjustment Factor shall not exceed the Annual Percentage Change in CPI for any facility owned and operated by Contractor or their Subcontractor. The adjustment shall be calculated as follows: Adjusted Processing Component = Then-current Processing Component x (Current approved Processing Facility Tipping Fee / Prior approved Processing Facility Tipping Fee) For example, assuming: 1. Then-current Processing Component = $2.00 2. Current approved Processing Facility Tipping Fee = $16.00 per Ton 3. Prior approved Processing Facility Tipping Fee = $15.00 per Ton 4. Adjusted Processing Component = $2.00 x ($16.00 / $15.00) = $2.13 Step 5: Calculate the adjusted Fee Component, rounded to the nearest cent, for each Rate. The adjusted Fee Component of each Rate shall be calculated as follows: Adjusted Fee Component = Then-current Fee Component x (1+OCF) For example, assuming: 1. Then-current Fee Component = $5.00
PRELIMINARY DRAFT Franchise Agreement, Exhibit B1 Page B1-2

EXHIBIT B1 MULTI-INDEX RATE ADJUSTMENT METHODOLOGY


2. 3. OCF = 3.9% Adjusted Fee Component = $5.00 x (1 + 0.039) = $5.20

Step 6: Calculate the adjusted value for each Rate charged under this Agreement. Adjusted Rates shall be calculated as follows: Adjusted Rate = Adjusted Operating Component + (Adjusted Disposal Component OR Adjusted Processing Component) + Adjusted Fee Component For example, assuming: 1. The Rate being adjusted is a Solid Waste Collection Rate 2. Adjusted Operating Component = $51.35 (as calculated in Step 2) 3. Adjusted Disposal Component = $21.62 (as calculated in Step 3) 4. Adjusted Fee Component = $5.20 (as calculated in Step 5) 5. Adjusted Rate = $51.35 + $21.62 + $5.20 = $78.17

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Franchise Agreement, Exhibit B1 Page B1-3

EXHIBIT B2 COST-BASED RATE ADJUSTMENT METHODOLOGY


General The cost-based adjustment involves review of the Contractors actual cost of operations and operational statistics (staffing levels, routes, route hours, Customers and their service levels, etc.) to determine the Total Contractors Compensation for the current Rate Period and to forecast the Total Contractors Compensation for the coming Rate Period. The difference (measured as a percentage) between the Total Contractors Compensation for the coming Rate Period and the Gross Receipts most-recently reported calendar year is the Rate Adjustment Factor. The Rate Adjustment Factor is applied to the then-current Rates to determine the Rates for the coming Rate Period. The intent of performing the cost-based adjustment is to examine the actual impact of changes in inflation, the number of Customers, and the Service Level of Customers. The City may incur costs, including consulting and legal fees, when determining adjustments to the Rates in accordance with this Exhibit and may require the Contractor to pay for such costs within sixty (60) calendar days of receipt of the Citys invoice for such costs. The Contractor may recover such costs through the Rates by treating the costs as an allowable Pass-Through Cost. Regardless of Contractors payment of costs associated with said review, the City shall retain full and unimpeded discretion in selection of its agents to ensure, at a minimum, that no conflict of interest arises in the review of Contractors request. The City retains the right to select its agents on the basis of their qualifications and experience and without regard to cost. Forecasting Total Contractors Compensation The Total Contractors Compensation for the coming Rate Period shall be forecasted in the manner described in this Section. A. Forecasting Total Annual Cost of Operations 1. Determine Actual Total Annual Cost of Operations. Contractor's financial statement, books, and records shall be reviewed to determine Contractor's Actual Total Annual Cost of Operations for the most-recently completed Rate Period to perform all the services in the manner required by this Agreement for each of the following cost categories: a. b. c. d. e. Labor-related costs Vehicle-related costs (excluding fuel) Fuel costs Other costs Depreciation costs

2. Calculate Allowable Costs. Contractor shall calculate Allowable Total Annual Cost of Operations for the most-recently completed Rate Period by adjusting Actual Total Annual Cost
PRELIMINARY DRAFT Franchise Agreement, Exhibit B2 Page B2-1

EXHIBIT B2 COST-BASED RATE ADJUSTMENT METHODOLOGY


of Operations for the most-recently completed Rate Period (determined in accordance with A.1 above) to deduct non-allowable costs. The Allowable Total Annual Cost of Operations shall be reported in the cost categories identified in A.1 above. Non-allowable costs that shall be deducted from actual costs include the following: a. b. Labor and equipment costs for personnel and Vehicles that are not specified in the proposal forms contained in Exhibit C. Payments to directors and/or owners of Contractor unless the amount paid is reasonable compensation for services actually rendered. Reasonableness shall be determined based on available market pricing for similar services and shall be in the sole discretion of the City. Travel expenses and entertainment (above five thousand dollars ($5,000) annually in total) expenses, unless authorized in advance by the City. Payments to repair damage to public or private property for which Contractor is legally liable. Fines or penalties of any nature. Liquidated Damages assessed under this Agreement. Federal or State income taxes. Charitable or political donations unless such donation is to a youth, civic, or charitable organization and has been previously approved in writing as an allowable expense by the City Contract Manager. Depreciation or interest expense for Collection Vehicles, Containers, other equipment, offices and other facilities if such items are leased as specified in Exhibit C. Attorney's fees and other expenses incurred by Contractor in any court proceeding in which the City and Contractor are adverse Parties. Attorney's fees and other expenses incurred by Contractor arising from any act or omission in violation of this Agreement. Attorneys' fees and other expenses incurred by Contractor in any court proceeding in which Contractor's own negligence, violation of law or regulation, or wrong doing are in issue and occasion, in whole or in part, the attorneys' fees and expenses claimed; and attorneys' fees and expenses incurred by Contractor in a court proceeding in which the legal theory or statute providing a basis of liability against Contractor also provides for separate potential liability for the City derived from the action of its citizens or Rate payers (such as in a CERCLA lawsuit) unless the Contractor is found not liable in such claims and such claims
Franchise Agreement, Exhibit B2 Page B2-2

c. d. e. f. g. h.

i.

j. k. l.

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EXHIBIT B2 COST-BASED RATE ADJUSTMENT METHODOLOGY


arise from acts or occurrences within the Term of the Agreement. m. n. o. p. q. Payments to Related-Party Entities for products or services, in excess of the cost to the Related-Party Entities for those products or services. Goodwill. Unreasonable profit sharing distributions. Replacement costs for Containers that need to be replaced because the useful life of such Container was less than the Term. Administrative costs greater than the administrative costs presented in Contractors Proposal (Exhibit C) adjusted annually by the Annual Percentage Change in the CPI. Bad debt write-offs in excess of two percent (2%) of annual Rate revenues.

r.

3. Forecast Total Annual Cost of Operations. Forecasted Total Annual Cost of Operations for the coming Rate Period shall be calculated based on Allowed Total Cost of Operations for the most-recently completed Rate Period determined in accordance with A.2 above. The forecasts shall be performed in the following manner: a. Forecasted labor-related costs shall be calculated for the coming Rate Period by multiplying the allowed labor-related costs, both direct and allocated, for the most-recently completed Rate Period by one (1) plus the Annual Percentage Change in the ECI. The result of this calculation shall be multiplied once more by one (1) plus the Annual Percentage Change in the ECI. Forecasted Vehicle-related costs (excluding fuel and depreciation costs) shall be calculated for the coming Rate Period by multiplying the allowed Vehicle-related costs, both direct and allocated, for the most-recently completed Rate Period by one (1) plus the Annual Percentage Change in the CPI. The result of this calculation shall be multiplied once more by one (1) plus the Annual Percentage Change in the CPI. Forecasted fuel costs shall be calculated for the coming Rate Period by multiplying the allowed fuel costs, both direct and allocated, for the mostrecently completed Rate Period by one (1) plus the Annual Percentage Change in the Fuel Index. The result of this calculation shall be multiplied once more by one (1) plus the Annual Percentage Change in the Fuel Index. Forecasted other costs shall be calculated for the coming Rate Period by multiplying the allowed other-related costs, both direct and allocated, for mostrecently completed Rate Period by one (1) plus the Annual Percentage Change in CPI. The result of this calculation shall be multiplied once more by one (1) plus the Annual Percentage Change in the CPI.
Franchise Agreement, Exhibit B2 Page B2-3

b.

c.

d.

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EXHIBIT B2 COST-BASED RATE ADJUSTMENT METHODOLOGY


e. Forecasted direct depreciation expense shall be the amount specified in Exhibit C2 for Vehicles, Containers, and facilities. Direct depreciation expense is a fixed cost and is not subject to inflation. Forecasted allocated depreciation expense shall be the amount specified in Exhibit C2 for Vehicles, Containers, and facilities. Allocated depreciation expense is a fixed cost and not subject to inflation. Forecasted Total Annual Cost of Operations for the coming Rate Period shall equal the sum of the following costs, which shall have been calculated in accordance with the procedures in this Exhibit B2: (1) (2) (3) (4) (5) (6) B. Forecast Profit Forecasted labor-related costs Forecasted Vehicle-related costs (excluding fuel costs) Forecasted fuel costs Forecasted other costs Forecasted direct depreciation expense Forecasted allocated costs (depreciation)

f.

g.

Contractor shall be entitled to Profit on Forecasted Total Annual Cost of Operations. Profit shall be calculated using an operating ratio of XXXX percent (XX.X%) as proposed by Contractor and described in Exhibit C2. Profit shall be calculated using the following formula: Profit = (Forecasted Total Annual Cost of Operations/Operating Ratio)-Forecasted Total Annual Cost of Operations For Example: 1. Assuming an operating ratio of 92% 2. Assuming a Forecasted Total Annual Cost of Operations of $1,000,000 3. Profit = (1,000,000/.92)-1,000,000=86,956.52 C. Forecast Pass-Through Costs.

Pass-Through Costs for the coming Rate Period shall be forecasted in the following manner: 1. Forecasted Disposal Cost. Annual Forecasted Disposal Cost = (Tipping Fee at approved Disposal Facility) x (total Tons of Solid Waste Collected for the most-recently completed calendar year). Forecasted Recyclable Materials Processing Cost. Annual Forecasted Recyclable Materials Processing Cost = (Tipping Fee at approved Recyclable Materials Processing Facility) x (total Tons of Recyclable Materials Collected for the most-recently completed calendar year)

2.

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EXHIBIT B2 COST-BASED RATE ADJUSTMENT METHODOLOGY


3. 5. 6. D. Forecasted Interest Expense. Interest Expense is $XXX,XXX per year and shall not be adjusted over the Term of the Agreement. Forecasted Direct Lease Costs. Direct Lease Costs are $XXX,XXX per year and shall not be adjusted over the Term of the Agreement. Forecasted Allocated Lease Costs. Allocated Lease Costs are $XXX,XXX per year and shall not be adjusted over the Term of the Agreement.

Forecast City Fees 1. 2. Forecasted Franchise Fee. Forecasted Franchise Fees, which shall equal XXXXXXX percent (XX.XX%) of the Forecasted Total Contractors Compensation. Forecasted Administrative Fee. The Forecasted Administrative Fee shall be in an amount prescribed by the City. If no revised Administrative Fee is provided by the City, the Administrative Fee paid to the City during the prior Rate Period shall remain in effect. Forecasted Total City Fees. Forecasted Total City Fees shall equal the sum of the Forecasted Franchise Fee and Forecasted Administrative Fee.

3.

RATE ADJUSTMENT FACTORS A. Operating Component Rate Adjustment Factor. The Operating Component Rate Adjustment Factor shall be determined by dividing the sum of the Forecasted Total Annual Cost of Operations, Forecasted Profit, Forecasted Interest Expense, Forecasted Direct Lease Costs, and Forecasted Allocated Lease Costs by the sum of the Actual Total Annual Cost of Operations, Profit, Interest Expense, Direct Lease Costs, and Allocated Lease Costs, rounded to the nearest thousandth. B. Disposal Component Rate Adjustment Factor. The Disposal Component Rate Adjustment Factor shall be determined by dividing the Forecasted Disposal Cost by the Disposal Component portion of Rate Revenues received over the most recent twelve (12) months, rounded to the nearest thousandth (1000th). The Disposal Component shall only be applied to Solid Waste Collection Rates and shall not be included in the calculation of Recyclable Materials Collection Rates or Special Charges. C. Processing Component Rate Adjustment Factor. The Processing Component Rate Adjustment Factor shall be determined by dividing the Forecasted Processing Cost by the Processing Component portion of Rate Revenues received over the most recent twelve (12) months, rounded to the nearest thousandth (1000th). This calculation shall be performed for the Forecasted Recyclable Materials Processing Cost for determination of Recyclable Materials Collection Rates. The Processing Component Rate Adjustment Factor shall not be applied to Solid Waste Collection Rates or Special Charges. D. Fee Component Rate Adjustment Factor. The Fee Component Rate Adjustment Factor shall
Franchise Agreement, Exhibit B2 Page B2-5

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EXHIBIT B2 COST-BASED RATE ADJUSTMENT METHODOLOGY


be determined by dividing the Forecasted Total City Fees by the sum of all City Fees, as described in Article 7 of the Agreement, paid to the City by Contractor over the most recent twelve (12) months, rounded to the nearest thousandth (1000th). ADJUSTMENT OF RATES Each then-current Rate component shall be multiplied by the associated component Rate Adjustment Factor to calculate the effective Rate for the coming Rate Period. All Special Charges shall be adjusted using the Operating Component Rate Adjustment Factor.

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Franchise Agreement, Exhibit B2 Page B2-6

EXHIBIT D REPORTING REQUIREMENTS


Records shall be maintained in forms and by methods that facilitate flexible use of data contained in them to structure reports, as needed. Reports are intended to compile recorded data into useful forms of information that can be used to, among other things: 1. Determine and set Rates and evaluate the financial efficacy of operations. 2. Evaluate past and expected progress towards achieving the Contractors Diversion goals and objectives. 3. Provide concise and comprehensive program information and metrics for use in fulfilling reporting requirements under the Act. 4. Determine needs for adjustment to programs. 5. Evaluate Customer service and complaints.

Quarterly Report Content


Quarterly reports shall be presented by Contractor to show the following information for each month in the reported quarter and include a quarterly average. In addition, each quarterly report shall show the past four (4) quarters average for data comparison (the first three (3) quarters of the Agreement shall only include the available quarterly information). 1. Tonnage Report Tonnage delivered to each Approved Facility by Customer Type, subtotaling and clearly identifying those Tons that are Disposed and those that are Diverted. Units of Bulky Items Collected by Customer Type. Recyclable Materials Tonnage Marketed (by commodity and including average commodity value for each) and Processing Residue Tonnage Disposed.

2. Customer Report Number of Customers by Customer Type. Number of Containers at each Service Level by Customer Type and program. Summarizing the total gallons of Cart service, cubic yards of Bin service, and pulls and cubic yards or Tons of Drop Box and Compactor service by Customer Type. Report should calculate the average volume of service received per Single-Family Customer and Commercial Customer. Number of Bulky Item Collection events by Customer Type. Participation percentage by program and Customer Type where the participation percentage is calculated as the number of Customers who have subscribed to or requested service under the program relative to the number of Customers of that Customer Type subscribing to Solid Waste service. Contractor shall not be required to submit participant Customer names and addresses
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EXHIBIT D REPORTING REQUIREMENTS


as part of the regular reporting; however, such information shall be provided to the City Contract Manager upon request. 3. City Services Report City facility Diversion rate report (i.e., volume of service by Service Type received by each County Waste Facility and the percentage of the total Service Levels that are for Diversion services relative to the total).

4. Customer Service Report Number of Customer calls listed separately by complaints and inquiries (where inquiries include requests for Recycling information, Rate information, etc.). For complaints, list the number of calls separately by category (e.g., missed pickups, scheduled cleanups, billing concerns, damage claims, etc.). Number of new service requests for each Customer Type and program. Number of events of Discarded Materials being tagged for non-Collection summarized by the reason for tagging (e.g., inclusion of non-Recyclable materials, improper setout, Hazardous Waste, etc.). Number of hits and unique visitors to the Contractors website.

5. Education and Outreach Report Provide a status report of Contractors actual activities completed compared to the annual public education plan. For each completed item, document the results including what date the activity was performed, how many Customers were targeted or participated, and what methods were used to accomplish the task, if different from the plan. Summarize the Recycling opportunity assessments provided to Customers by identifying the number of Recycling opportunity assessments conducted each month in the most-recently completed quarter, and contact information including address, contact names, and telephone number of Persons contacted. Include any Service Level changes resulting from such visits. Dates, times, and group names of meetings and events attended.

6. Pilot and New Programs Report For each pilot and/or new program, provide activity related and narrative reports on goals, milestones, and accomplishments. Describe problems encountered, actions taken and any recommendations to facilitate progress. Describe vehicles, personnel, and equipment utilized for each program. 7. Revenue Report Provide a statement detailing Gross Receipts from all operations conducted or permitted pursuant to this Agreement as required by Section 7.8.

PRELIMINARY DRAFT

Franchise Agreement, Exhibit D Page D-2

EXHIBIT D REPORTING REQUIREMENTS


Maintain a list of Customers that are forty five (45) or more calendar days past due and include the following information for each delinquent account: name; service address; contact information; number of days the account is delinquent; method(s) the Contractor has used to attempt collection of the bad debt including date of such attempt(s); and, identification, if, and when the Contractor plans to or did stop service to a delinquent account.

Annual Report Content


The annual report shall be the fourth quarterly report plus the following additional information. 1. Summary Assessment. Provide a summary assessment of the programs performed under this Agreement from Contractor's perspective relative to the financial and physical status of the program. The physical status assessment shall reflect how well the program is operating in terms of efficiency, economy, and effectiveness in meeting all the goals and objectives of this Agreement, particularly the Contractors Diversion goals. Provide recommendations and plans to improve. Highlight significant accomplishments and problems. Results shall be compared to other similar size communities served by the Contactor in the State. 2. Vehicle Inventory Provide a listing of all vehicles used in performing services under this Agreement including the license plate number, VIN, make, model, model year, purchase date, engine overhaul/rebuild date (if applicable), and mileage at December 31. 3. Recyclables Markets. Contractor shall include a listing of markets for Recyclable Materials and the end use of these materials. This type of information is intended to help the City gauge the sustainability of Recycling markets and the ultimate Disposal of all types of materials Collected. 4. Cost-Based Rate Adjustment Data Provide the following information only if Rates are to be determined for the upcoming Rate Period using a cost-based adjustment pursuant to Exhibit E2. With the exception of the Financial Information listed below, all other items listed may be requested by the City Contract Manager at any time during the Term of the Agreement and Contractor shall comply with that request in a timely fashion. a) Financial Information. Within one hundred twenty (120) calendar days after the close of the Rate Period, Contractor shall deliver to the City four (4) hard copies and one (1) electronic copy of the audited consolidated financial statements and profit and loss statements of Contractor for the preceding Rate Period. Financial statements shall include a supplemental combining schedule showing Contractor's results of operations, including the specific revenues and expenses in connection with the operations provided for in this Agreement from others included in such
PRELIMINARY DRAFT Franchise Agreement, Exhibit D Page D-3

EXHIBIT D REPORTING REQUIREMENTS


financial statements. The financial statements and footnotes shall be prepared in accordance with Generally Accepted Accounting Principles (GAAP) consistently applied and fairly reflecting the results of operation and Contractors financial condition. Annual financial statements shall be audited, in accordance with Generally Accepted Auditing Standards (GAAS) by a Certified Public Accountant (CPA) licensed (in good standing) to practice public accounting in the State as determined by the State Department of Consumer Affairs Board of Accountancy, and that the CPAs opinion on Contractor's annual financial statements shall be unqualified, and shall contain the CPAs conclusions regarding the Contractors accounting policies and procedures, internal controls, and operating policies. The CPA shall perform an evaluation and, if necessary, shall cite recommendations for improvement. b) Related Party Entities. As part of the annual reporting requirement, Contractor shall provide the City with a copy of each related party entity's (whose cost of services are not pre-determined in this Agreement on a unit price basis or by a governmental contractor) audited annual financial statements and management letter for that fiscal year, or within ninety (90) calendar days of each related party entity's fiscal year-end, if timing does not coincide with the annual report date. Financial statements shall be prepared in accordance with GAAP and audited, in accordance with GAAS, by a CPA licensed in the State, and that the CPA's opinion on each related party entity's annual financial statements shall be unqualified, and that the CPA make available to the City (or the City's designated representative) such CPA's working papers related to the audit. Contractor agrees that all financial transactions with all related party entities shall be approved in advance in writing and disclosed in a separate disclosure letter to the City, upon request. This letter shall include, but not be limited to, the following information: A general description of the nature of each related party entity transaction, or type of transaction (if many similar transactions exist) shall be provided, as applicable. Such description shall include for each (or similar) transaction, amounts, specific related party entity, basis of amount (how amount was determined), description of the allocation methodology used to allocate any common costs, and profit amount. Amounts shall be reconciled to the related party entity disclosures made in Contractor's annual audited financial statements referred to in this Exhibit. At the City's request, Contractor shall provide the City with copies of working papers or other documentation deemed relevant by the Contractor relating to information shown in the annual disclosure letter.

Operational Information: A. Routes by Customer Type: 1. Number of routes per day. 2. Types of vehicles. 3. Crew size per route. 4. Number of full time equivalent (FTE) routes.
Franchise Agreement, Exhibit D Page D-4

PRELIMINARY DRAFT

EXHIBIT D REPORTING REQUIREMENTS


5. 6. 7. B. Number of accounts and cubic yards scheduled per route. Total route hours per Customer Type per year. Average cost per route.

Personnel: 1. Organizational chart. 2. Job classifications and number of employees (e.g., administrative, Customer service representatives, drivers, supervisors, educational staff). 3. Wages by job classification. 4. Number of FTE positions for each job classification. 5. Number of hours per job classification per year. Productivity Statistics: 1. Average Number of accounts per route per day by Customer Type. 2. Average number of setouts per route per day by Customer Type. 3. Average Tons per route per day by vehicle type (i.e. side-loader, front-loader, roll-off). 4. Average cubic yards of Collection scheduled per route. Vehicles: 1. List of collection vehicles including year purchased and mileage. 2. Average age of mobile equipment with oldest and newest. Operational Changes: 1. Number of routes. 2. Staffing. 3. Supervision. 4. Collection services.

C.

D.

E.

Variance Analysis. Provide the following variance analysis for each Customer Type. For any variances greater than five percent (5%) annually, Contractor shall provide sufficient rationale to support variance: 1. 2. Variance analysis comparing current Rate Period to each of the prior Rate Periods of Agreement Variance analysis comparing current Rate Period to each of the future projected Rate Periods.

PRELIMINARY DRAFT

Franchise Agreement, Exhibit D Page D-5

ATTACHMENT 2: PROPOSAL FORMS

Form 1 General Proposal Information

General Proposer Information Proposer Name: ________________________

City of Ridgecrest Base Services

A. Primary Contact Information


1. Name 2. Title 3. Phone 4. Fax 5. E-mail

B. Support Facilities
1. Address of collection vehicle parking, maintenance, washing, and route staff parking facility(ies) 2. Address of administrative office 3. Address of billing office 4. Address of customer service office

C. Vehicle Manufacturer and Specifications (Body Capacity, GVWR, Load Capacity)


1. Residential Collection Vehicles 2. Commercial Collection Vehicles 3. Drop Box Vehicles

D. Container Manufacturer, Sizes Offered, and Specifications


1. Carts 2. Bins 3. Drop Boxes

E. Recyclable Materials Processing and Handling


1. Name of processing site 2. Owner's name 3. Operator's name 4. Address of processing location 5. Hauling method (e.g. direct haul, transfer haul, Pod haul) 6. Name and address of transfer location (if applicable) 7. Tip Fee (Inclusive of transfer and disposal costs) 8. Recyclable Materials Sales Revenue per Ton

Page 1 of 1

Operating Statistics Proposer Name: ________________________

Form 2 Operating Statistics

City of Ridgecrest Base Services

Proposer: Please provide the operating basis for your proposed costs (as identified in Form 5) and rates (as identified in Forms 6 and 7). These operating estimates should also be consistent with the Staffing Plan (Form 3) and Equipment Plan (Form 4). Please ONLY complete the yellow shaded cells and do not adjust the formulas in other cells.
REPORT FOR 12-MONTH PERIOD From January 1, 2012 to December 31, 2012

Solid Waste

Residential Recyclable Materials

Bulky Waste Program

Commercial / Multi-family Recyclable Solid Waste Materials

Drop Box Recyclable Solid Waste Materials

TOTAL

1
2 3 4 5 6 7 8 9 10 11 12 13 14 16 17

Account Information Labor Information

# of weekly accounts/customers # of regular route personnel Labor hours/day/person Total labor hours/year

Route Information
# of routes per weekday # of persons/route # of route hours/day/route # of route hours/year # of FTE routes # of lifts/pulls per week for all routes # of lifts/pulls per year for all routes # of lifts/pulls route hour

Tonnage Information (annual)


Solid waste collected Recyclable materials collected Processing residue disposed Net Diverted

15 Total Collected

Projected Diversion Rate

Page 1 of 2

Operating Statistics Proposer Name: ________________________

Form 2 Operating Statistics

City of Ridgecrest Base Services

Proposer: Please provide the operating basis for your proposed costs (as identified in Form 5) and rates (as identified in Forms 6 and 7). These operating estimates should also be consistent with the Staffing Plan (Form 3) and Equipment Plan (Form 4). Please ONLY complete the yellow shaded cells and do not adjust the formulas in other cells.

Notes for Form 2: Line 1 - Should equal the number of customer serviced on a weekly basis. This should tie to the estimates presented in Forms 6 and 7. Line 2 - Data to be input by proposer. Data should reflect the assumptions used for the basis of the costs proposed in Form 5. Line 3 - Identify number of hours per day each regular route employee will work each day (including breaks, pre- and post-route checks, etc., excludes casual/pool personnel). Line 4 - Should equal Line 2 * Line 3 * 260 days Line 5 - Information is to be reported for collection routes only and does not include any support (e.g., container delivery routes, cleanup routes, missed pickup routes etc.) Line 6 - Data to be input by proposer. Data should reflect the assumptions used for the basis of the costs proposed in Form 5. Lines 7 - Identify number of hours per day each route will take to complete (including collection time and hauling time to transfer station, landfill, or processing site). Line 8 - Should equal Line 5 * Line 6 * Line 7 * 260 days Line 9 - Should equal Line 8/2080 hours per year Line 10 - Data to be input by proposer. Data should reflect the assumptions used for the basis of the costs proposed in Form 5. Line 11 - Should equal Line 10 * 52 weeks. Line 12 - Should equal Line 11/ Line 8 Line 13 - Data to be input by proposer. Data should reflect the assumptions used for the basis of the costs proposed in Form 5. Line 14 - Data to be input by proposer. Data should reflect the assumptions used for the basis of the costs proposed in Form 5. Line 15 - Should equal Line 13 + Line 14. Line 16 - Data to be input by proposer. Processing residue is the material disposed from the recyclable materials processing facility which cannot be marketed. Line 17 - Should equal Line 14 - Line 16 Pulls = pull and return etc. Full Time Equivalent (FTE) = 40 hours per week, 2,080 hours per year

Page 2 of 2

Proposed Staffing Requirements Proposer Name: ________________________ Route Personnel Headcount


Residential Solid Waste Residential Recyclable Materials Residential Annual Clean-up Program Commercial Solid Waste Commercial Recyclable Materials Drop Box Solid Waste Drop Box Recyclable Materials

Form 3 Staffing Plan

City of Ridgecrest Base Services

(Include fractions of employees, as applicable)

# of Regular Personnel

# of Casual/Pool

Total 0 0 0 0 0 0 0

Subtotal Route Personnel Other Personnel Headcount


(Include fractions of employees, as applicable.) Chief Executive Officer/Chief Financial Officer General Manager Operations Manager Route Supervisor Dispatcher Container Distribution Container Maintenance/Welder Maintenance Supervisor Maintenance Personnel Controller Staff Accountant Office Manager Customer Service Supervisor Customer Service Representatives Recycling Manager Recycling/Public Education Coordinator Other (specify): __________________ Other (specify): __________________ Other (specify): __________________

0 # of Employees

Subtotal Other Personnel Total ALL Personnel

0 0

Page 1 of 1

Capital Requirements Proposer Name: ________________________ Collection Vehicles


Rear Loader(s) Side Loader(s) Front Loader(s) Roll Off Subtotal 0

Form 4 Equipment Plan

City of Ridgecrest Base Services Quantity Used


Proposed Cost During Contract Term

Actual Spare

New

Total Actual Spare 0 0 0 0

Total Total Actual Spare 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Total 0 0 0 0

0 0 0 0 0 0 0

0 0 0 0 0 0 0

0 $ 0 $ 0 0 0 0 0 $

Other Vehicles
Pickup Trucks Container Distribution Mobile Service Truck Other (specify): __________________ Other (specify): __________________ Subtotal 0 0

Total Vehicle Cost $

Containers
Cart service Solid Waste 96-gallon Recyclable Material 96-gallon Subtotal Bin service 1.5 cubic yard 3 cubic yards 6 cubic yards Subtotal Drop Box service 10 cubic yards 15 cubic yards 20 cubic yards 25 cubic yards 30 cubic yards 35 cubic yards 40 cubic yards Other (specify): __________________ Other (specify): __________________ Subtotal 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $ -

Total Container Cost $

Other (If Applicable)


Offices Processing Site(s) Transfer Station Corporation Yard/Maintenance Container Storage Yard Shop Equipment Fueling Equipment Computer and Office Equipment Procurement-Related Expense Other (specify): __________________ Total Cost $ Total Other Cost $ $ 140,000 140,000 140,000

Page 1 of 1

Summary of Contractor's Compensation Proposer Name: ________________________

Form 5 Annual Operating Cost

City of Ridgecrest Base Services

Proposer: Please provide the cost basis for your proposed rates below for each of the lines of service and each cost category identified. Please ONLY complete the shaded cells and do not adjust the formulas or dollar amounts populated in cells which are not shaded.

RATE PERIOD 1 From January 1, 2012 to December 31, 2012

Single-family Solid Waste Recyclable Materials

Commercial / Multifamily
Bulky Waste Program Solid Waste

Drop Box TOTAL

Recyclable Recyclable Materials Solid Waste Materials

Annual Cost of Operations


Labor-Related Costs Vehicle-Related Costs Fuel Costs Other Costs Direct Depreciation (e.g. Vehicles and Equipment) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Annual Cost of Operations Profit Pass-Through Costs


Disposal Cost Net Recyclable Materials Processing Costs Interest Expense Lease Costs

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

Total Pass-Through Costs Total Costs before City Fees* City Fees
Franchise Fee Contract Administration Fee

$0

$0

$0

$0

$0

$0

$0

$0

---------

---------

---------

---------

---------

---------

---------

$11,111 $100,000 $111,111 $111,111

Total City Fees Total Proposed Annual Costs

Page 1 of 1

Form 6 Cart Bin Rate Proposal

Cart and Bin Rate Proposal Proposer Name: ________________________

City of Ridgecrest Base Services

Instructions to Proposer: Enter the estimated number of accounts for all service levels. Only enter rates for 96-gallon Cart with 1 pickup per week and 1 cubic yard Bin with 1 pick-up per week solid waste service; and other services which are shaded below. All other rates and the estimated annual rate revenues will be calculated based on those input rates. Rates shall be proposed for the first rate year of the Franchise starting January 1, 2012.

Type of Service

Receptacle

Service Frequency (Pick-Ups/Week)

Rate Factor

Total Rate

Estimated Number of Estimated Annual Accounts Rate Revenues

Regularly Scheduled Solid Waste Cart Services


Solid Waste Solid Waste Solid Waste
One 64-gallon cart (Senior Rate) One 96-gallon cart Additional 96-gallon cart

1 1 1

0.75 1.00 0.80

$0.00 $0.00 $0.00

0 0 0

$0 $0 $0

Regularly Scheduled Solid Waste Bin Services


Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste
1.5 cubic yard container 1.5 cubic yard container 1.5 cubic yard container 1.5 cubic yard container 1.5 cubic yard container 3 cubic yard container 3 cubic yard container 3 cubic yard container 3 cubic yard container 3 cubic yard container 6 cubic yard container 6 cubic yard container 6 cubic yard container 6 cubic yard container 6 cubic yard container

1 2 3 4 5 1 2 3 4 5 1 2 3 4 5

1.00 1.92 2.82 3.66 4.46 1.90 3.62 5.14 6.46 7.58 3.60 6.42 9.04 12.06 15.08

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Regularly Scheduled Recyclable Materials Cart Services (50% of Comparable Solid Waste Rate)
Recyclable Materials Recyclable Materials Recyclable Materials Recyclable Materials
One 96-gallon cart One 96-gallon cart Additional 96-gallon cart Additional 96-gallon cart

Every Other Week 1 Every Other Week 1

0.25 0.50 0.20 0.40

$0.00 $0.00 $0.00 $0.00

0 0 0 0

$0 $0 $0 $0

Regularly Scheduled Recyclable Materials Bin Services (50% of Comparable Solid Waste Rate)
Recyclable Materials Recyclable Materials Recyclable Materials Recyclable Materials Recyclable Materials Recyclable Materials
1.5 cubic yard container 1.5 cubic yard container 3 cubic yard container 3 cubic yard container 6 cubic yard container 6 cubic yard container

Every Other Week 1 Every Other Week 1 Every Other Week 1

0.25 0.50 0.48 0.95 0.90 1.80

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00

0 0 0 0 0 0

$0 $0 $0 $0 $0 $0

Page 1 of 2

Form 6 Cart Bin Rate Proposal

Type of Service

Receptacle

Service Frequency (Pick-Ups/Week)

Rate Factor

Total Rate

Estimated Number of Estimated Annual Accounts Rate Revenues

Other Services
Extra bulky waste collection frequency (beyond 3 per year) Extra Appliance or Bulky Waste Item Collection (beyond 1 per event) Extra bulky waste collection volume (beyond 3 cubic yards per event) On-Property Service Extra can or bag of Solid Waste collected on customer's regularly scheduled collection day Extra can or bag of Solid Waste collected on a day other than the customer's regularly scheduled collection day N.A.
Per occurrence

N.A.

$0.00

N.A.

N.A.

N.A.

Per item

N.A.

$0.00

N.A.

N.A.

N.A.

Per cubic yard per occurrence Per Month Per occurrence

N.A.

$0.00

N.A.

N.A.

N.A. 32-gal can or bag

N.A. N.A.

$0.00 $0.00

0 N.A. N.A.

$0

32-gal can or bag

Per occurrence

N.A.

$0.00

N.A.

N.A.

Extra pick-up for on-call service or overage pick-up service for regular container customers

1.5 to 6 cubic yard container

Per cubic yard per occurrence

N.A.

$0.00

N.A.

N.A.

Lock/unlock Steam cleaning Other Charges

N.A. N.A.

Per Month Per occurrence

N.A. N.A.

$0.00 $0.00

N.A. N.A.

N.A. N.A.

Does proposer wish to include any other Rates? (circle one: YES / NO) If the answer to the above question is YES, provide a list of any and all other charges the proposer wishes to include in its proposal on a separate sheet along with the proposed Rates.

Estimated Annual Revenue

$0

Page 2 of 2

Form 7 Drop Box Rate Proposal

Drop Box and Compactor Rate Proposal Proposer Name: ________________________

City of Ridgecrest Base Services

Instructions to Proposer: Enter Operating and Tipping Fee Component for each regularly scheduled service and oncall service which are shaded below. Rates shall be proposed for the first rate year of the Franchise starting January 1, 2012.

Type of Service

Receptacle

Service Frequency

Cost/Pull

Cost/Ton

Annual Estimated Total Rate Number of Pulls

Annual Estimated Tons

Estimated Annual Rate Revenues

Regularly Scheduled Collection Service (Monthly Rate not including rental & delivery fees which are charged separately) Solid Waste Solid Waste Solid Waste Solid Waste Recyclable Material Recyclable Material Recyclable Material Recyclable Material
3 cubic yard compactor 6 cubic yard compactor 10 cubic yard compactor 20 cubic yard compactor 3 cubic yard compactor 6 cubic yard compactor 10 cubic yard compactor 20 cubic yard compactor

1 pickup/week 1 pickup/week 1 pickup/week 1 pickup/week 1 pickup/week 1 pickup/week 1 pickup/week 1 pickup/week

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0

$ $ $ $ $ $ $ $

On-Call Collection Service (Per Pick-Up Rate not including rental and delivery fees which are charged separately) Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Solid Waste Recyclable Material Recyclable Material Recyclable Material Recyclable Material Recyclable Material Recyclable Material Recyclable Material Recyclable Material Other Charges Does proposer wish to include any other charges? (circle one: YES / NO) If the answer to the above question is YES, provide a list of any and all other charges the proposer wishes to include in its proposal on a separate sheet along with the proposed charges.
10 cubic yard drop box 20 cubic yard drop box 30 cubic yard drop box 40 cubic yard drop box 3 cubic yard compactor 6 cubic yard compactor 10 cubic yard compactor 20 cubic yard compactor 10 cubic yard drop box 20 cubic yard drop box 30 cubic yard drop box 40 cubic yard drop box 3 cubic yard compactor 6 cubic yard compactor 10 cubic yard compactor 20 cubic yard compactor

On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup On-call pickup

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A.

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A.

Estimated Annual Revenue

N.A.

Page 1 of 1

ATTACHMENT 3: NON-COLLUSION AFFIDAVIT

ATTACHMENT 3 NON-COLLUSION AFFIDAVIT

Proposer's Name FOR:SOLIDWASTEANDRECYCLABLEMATERIALCOLLECTIONANDDIVERSIONPROGRAMS Proposer declares under penalty of perjury under the laws of the State of California that this proposal is not made in the interest of or on behalf of any undisclosed person, partnership, company, association, organization or corporation; that such proposal is genuine and not collusive or sham; that said Proposer has not directly or indirectly induced or solicited any other Proposer to put in a false or sham proposal and has not directly or indirectly colluded, conspired, connived, or agreed with any Proposer or anyone else to put in a sham proposal, or that anyone shall refrain from submitting a proposal; that said Proposer has not in any manner directly or indirectly sought by agreement, communication, or conference with anyone to fix the proposal price of said Proposer or of any other Proposer, or to fix any overhead, profit, or cost element of such proposal price, or of that of any other Proposer, or to secure any advantage against the public body awarding the Contract of anyone interested in the proposed Contract; that all statements contained in such proposal are true, and further, that said Proposer has not directly or indirectly submitted his proposal price or any breakdown thereof, or the contents thereof, or divulged information or data relative thereto, or paid and will not pay any fee in connection therewith, to any corporation, partnership, company, association, organization, proposal depository, or to any member or agent thereof, or to any other individual except to any person or persons as have a partnership or other financial interest with said Proposer in this general business.

The above Non-Collusion Affidavit is part of the proposal. Signing this proposal on the signature page thereof shall also constitute signature of this Non-Collusion Affidavit. Proposers are cautioned that making a false certification may subject the certifier to criminal prosecution.

ATTACHMENT 4: SECRETARYS CERTIFICATION

ATTACHMENT 4 SECRETARY'S CERTIFICATION


I, Name of the corporation named herein; that Name Proposal on behalf of the corporation, was then of Title said corporation; that said Proposal is within the scope of its corporate powers and was duly signed for and on behalf of said corporation by authority of its governing body, as evidenced by the attached true and correct copy of the Name of Corporate Document . , certify that I am the secretary who signed this

By: Name: Title: Date:

Secretary