COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Public Works

DATE:

June 18, 2007

BOARD MEETING DATE:

June 26, 2007

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

James C. Porter, Director of Public Works

SUBJECT:

Time Extension - Agreement for the Operation of the Pescadero Solid Waste Transfer Station

Recommendation

Adopt a resolution authorizing the President of the Board to execute an amendment to the Agreement with Allied Waste Services for the Operation of the Pescadero Solid Waste Transfer Station (Transfer Station), which extends the term of the Agreement until June 30, 2008, and increases annual compensation from $275,000 to $410,000.

Vision Alignment

Commitment: Responsive, effective and collaborative government.

Goal 20: Government decisions are based on careful consideration of future impacts rather than temporary relief or immediate gain.

An extension of the agreement will allow us to finalize proposed operational alternatives prior to making a recommendation to your Board.

Background

Previous Board Action

Contracted with Browning Ferris Industries (BFI), now called Allied Waste of San Mateo County (Allied), to operate the Transfer Station and extended the term of the Agreement to June 30, 2008.

History

Customer surveys have confirmed that the Transfer Station is a valued community resource in the County’s South Coastal area, as it provides convenient recycling and solid waste disposal service; and BFI’s or Allied’s operation of the facility rarely generates complaints.

The Transfer Station is twenty-one years old and its original compaction equipment is worn out and no longer used. This change has caused a significant change in operations that resulted in the contractor stating that they are now losing money while fulfilling their contractual obligations. In addition to these operational changes, the contractor has also experienced significant increases in fuel and labor expenses that were not envisioned in the original contract and there is no contractual remedy to address these increases beyond annual routine CPI increases. Staff believes that improvements are also needed at the Transfer Station to optimize its ability to operate as a recyclable materials drop-off facility, a use that was not envisioned or included in the original design of the facility. The plans for these improvements are being developed on a parallel track to the procurement of an operator.

Discussion

The Department is drafting a new agreement for the operation of the Transfer Station and preparing the procurement documents needed to solicit bids for its operation. An extension of the term of the County’s existing agreement with Allied is needed so that the Transfer Station can remain open during the procurement process. Therefore, we are recommending that your Board amend the Agreement to allow its term to be extended until June 30, 2008.

An amendment to the Agreement and a resolution has been approved as to form by County Counsel and Allied has executed the amendment.

Fiscal Impact

The cost of operating the Transfer Station - approximately $410,000 per year - is funded by an appropriation from the Solid Waste Fund. Disposal fees collected at the Transfer Station - approximately $60,000 per year - are revenues to the Solid Waste Fund and offset the costs.

There is no impact to the General Fund.