City of Culver City, California
Agenda Item Report
Meeting Date: 02/09/2015 Item Number: C-3
CITY COUNCIL AGENDA ITEM: Approval of an Agreement with CR&R for the
Purchase of Recyclable Material from the City for a Period of Three Years (to
January 31, 2018) as Part of a Pilot Program.
Contact Person/Dept.: Catherine Vargas /
Public Works
Phone Number: (310) 253-6411
Fiscal Impact: Yes [x] No [] General Fund: Yes [] No [x]
Public Hearing: [] Action Item: [] Attachments: []
Commission Action Required: Yes [] No [x] Date: _______________
Public Notification: (Email) Agenda and Meetings – City Council (02/04/15) ; (E-Mail)
Sustainability and Environmental Issues (02/04/15)
Department Approval:
Charles D. Herbertson (01/29/15)
City Attorney Approval:
Carol Schwab (by H. Baker) (02/02/15)
Chief Financial Officer Approval:
Jeff Muir (by M. Noller) (02/02/15)
City Manager Approval:
John M. Nachbar (02/03/15)
RECOMMENDATION:
Staff recommends that the City Council approve an agreement with CR&R to
purchase recyclable material from the City for a three year period as part of a
continuing pilot program.
BACKGROUND:
The City, through the Public Works Department’s Environmental Programs and
Operations Division (EPO), operates an exclusive franchise to collect, transfer, and
haul solid waste and recyclable material (such as aluminum, paper, glass,
corrugated cardboard, and plastics) within the City. EPO also plans and implements
waste diversion programs that divert recyclable material from ultimate disposal in a
landfill.
Recyclable material collected through EPO’s collection operations has historically
been sold to Bestway, a Material Recovery Facility (MRF) located approximately two
blocks east of the City’s transfer station. Bestway has been an optimal partner for
EPO’s collection operations because of its close proximity and short wait times.
However, due to a decrease in pricing by Bestway on the last contract, staff began
to explore other recycling processors that may be willing to pay more for the City’s
recyclable material. In addition, staff seeks to explore options for baseline pricing of
recycling material and profit sharing agreements that currently are used in other
municipalities like Burbank.
At the July 28, 2014 regular meeting, the City Council approved an agreement with
CR&R to purchase recyclable materials for a pilot program of six months. As part of City of Culver City, California
Agenda Item Report
the staff report presented at that meeting, Allen Company was also identified as a
potential alternative to either Bestway or CR&R. Unfortunately, staff was unable to
utilize Allen Company because of delays in contract negotiations and the physical
constraints at Allan Company to accept the City’s collection vehicles.
During the six month pilot program, Bestway notified staff late in 2014 that it would be
closing the facility the City uses effective December 31, 2014. Since Bestway and Allen
Company are no longer options, staff would like to continue the program with CR&R for
an additional three years under the same prices offered during the initial contract term
($30 per ton for commingled recycling material with a potential increase of $7-$10 per
ton dependent on market fluctuations).
DISCUSSION:
Recycling Material sold to CR&R Inc., an MRF located in Stanton, is delivered to the
City’s transfer station prior to being transported to Stanton via tractor/trailer. The City is
currently under contract with CR&R for use of the transfer station to load and transport
recycling material delivered by the City of Los Angeles. As a result, recyclable material
collected in Culver City would be mixed with recyclable material generated in the City of
Los Angeles.
CR&R has agreed to continue to provide the City with quarterly characterization
studies of the City’s recyclable material. These studies analyze the City’s material
and assign percentages to commodities such as: bottles, cans, glass, newsprint,
cardboard, and trash. The information provided from these studies is useful in
analyzing the effectiveness of the City’s recycling program. The next study is
scheduled for February 2015.
FISCAL ANALYSIS:
EPO, on average, collects and recycles 4,500 tons of recyclable material annually. By
extending the agreement with CR&R for an additional three years and based upon the
baseline pricing offered by CR&R, the City’s Refuse and Recycling Enterprise Fund
would expect approximately $400,000.00 in recycling revenues during the three year
pilot program, independent of the fluctuations in the recycling market. The proposed
agreement also includes provisions through which the City could realize additional
revenues above this baseline as a result of revenue sharing of 50% of any additional
profit realized by the vendor.
Additionally, EPO would avoid approximately $500,000.00 in transfer and disposal
costs by recycling the material instead of landfilling.
City of Culver City, California
Agenda Item Report
ATTACHMENTS:
None.
MOTION:
That the City Council:
1. Approve an agreement with CR&R, Inc. to purchase recyclable material, from
February 1, 2015 – January 31, 2018, for $30 per ton for commingled recycling
material with a potential increase of $7-$10 per ton dependent on market
fluctuations and,
2. Authorize the City Attorney to review/prepare the necessary documents; and,
3. Authorize the City Manager to execute such documents on behalf of the City.