California Assembly Bill AB 1826 (signed into law on September 28, 2014) requires local governments to establish and implement additional recycling programs. The purpose of this law is to achieve separation of commercial organic waste from the waste stream and diversion from landfills.
AB 1826 recycling requirements are phased in over several years and are intended to help the state meet its goal to recycle 75% of its waste by 2020. Specifically for organic waste, AB 1826 requires businesses (including non-profit and public entities) and multi-family dwelling units of five units or more meeting the following criteria to arrange for recycling services:
- Tier 1: On or after April 1, 2016, a business that generates 8 cubic yards or more of organic waste per week
- Tier 2: On or after January 1, 2017, a business that generates 4 cubic yards or more of organic waste per week
- Tier 3: On or after January 1, 2019, a business that generates 4 cubic yards or more of commercial solid waste per week
As noted, we are now in Tier 3. For Brea, there are approximately 638 businesses that fall under this category, which include all businesses from Tiers 1 and 2 as well. See Attachment 1 for full list.
Since early 2016, the City of Brea has been working diligently to adopt and implement the program. The following is a summary of prior City Council meetings that included discussion on this topic:
- February 2, 2016 – City Council adopts program, but did not include fees
- January 17, 2017 – City Council Study Session
- May 21, 2017 – City Council Study Session
- January 16, 2018 – City Council Study Session
- May 1, 2018 – City Council Meeting
- July 17, 2018 – City Council Meeting
In those meetings, staff provided information regarding two implementation fee options, Single User “Generator” Pricing or “Sector Wide” Pricing. The following is a brief description of both for context including the most recent pricing per Republic:
- Single User “Generator” Pricing Option:
Full program costs are covered by organic waste generators that subscribe to this program. Cost includes container, collection, disposal, processing, monitoring and City franchise fee. Cost does not include outreach. Since there are no general fees collected for organics, Republic will charge a business $200 for a site visit to assess container needs. If the business signs up for organic container service of 2 cubic yards, the site visit fee will be waived.
Attachment 2 shows the proposed fees for this option along with the methodology used by Republic to calculate the fees.
- Sector Wide Pricing Option:
Increase of refuse rates of 3.87% to be spread across the entire business sector. Cost includes collection, disposal, processing, monitoring, annual education and City franchise fee. Businesses that generate organics will also pay for any organic containers they may need based on the size and collection frequency.
Attachment 3 shows the methodology used to determine the proposed rate percent increase. In addition, Attachment 4 shows the proposed container fees for this option, which is limited to either 65 gallon or 2 cubic yard containers. The container fees for this option are the same as container fees for normal trash collection plus 3.87%.
The proposed rates for both options were reviewed by HF&H. HF&H concluded that both rates are reasonable given the expected operational cost by Republic to provide the service. As mentioned in a previous meeting, Option 1 participation is expected to be lower than Option 2. Hence, the cost to provide the service to a limited amount of customers results in higher individual costs. In contrast, higher participation is expected with Option 2 with comparatively lower costs. Attachment 5 shows the proposed container rates for both options side-by-side as requested by City Council at your July 17th meeting. Please recall that for either option, the cost of adding a new organics container is partially offset by the reduction in regular trash service by the proportional amount. There is more of a cost offset in Option 2. Either option meets the City's obligation under AB 1826 to have a fully implemented organics recycling program.
CalRecycle
City staff have been in regular contact with CalRecycle, which has been tracking Brea's progress towards implementation of the organics recycling program. In late 2017, CalRecycle issued the City a formal notice of non-compliance and requested an action plan. Staff submitted an action plan and CalRecycle stated that it would monitor progress for 1 year. CalRecycle also warned that, if City did not show substantial progress, then the City would be referred to CalRecycle’s Jurisdictional Compliance Unit (JCU).
Because the City does not yet have a fully implemented organics recycling program, CalRecycle sent Mayor Parker a letter on December 14, 2018 stating that the City has been referred to JCU for additional compliance review to take place at CalRecycle's monthly meeting on February 19, 2019 (Attachment 6). Staff will provide an update to CalRecycle as a result of any action taken at tonight’s meeting.
Recommendation
Staff recommends that City Council select an implementation option and take the following actions for either option:
Option 1: Single User Generator Pricing
- Direct staff to prepare a contract amendment along with fee resolution and bring back to City Council for approval at upcoming meeting
Option 2: Sector Wide Pricing
- Set Public Hearing for April 16, 2019 (45 day notice)
- Direct staff to mail out formal public hearing notice to all businesses
- Direct staff to prepare a contract amendment along with fee resolution and bring back to City Council for approval at such meeting
For Option 2, the approval process shall conform to Proposition 218 requirements regarding public noticing and protest vote thresholds. |