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99-23273 RESO RESOLUTION NO. 99-23273 A RESOLUTION OF THE MAYOR AND THE CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE ADMINISTRATION TO NEGOTIATE AGREEMENTS WITH THE FOUR EXISTING NON- EXCLUSIVE FRANCHISE LICENSEES: BROWNING-FERRIS INDUSTRIES; DAVIS SANITATION, INC.; IMPERIAL SANITATION SERVICE; AND WASTE MANAGEMENT OF DADE COUNTY-NORTH, TO PROVIDE ADDITIONAL SANITATION SERVICES TO THE CITY, AT NO COST TO THE CITY, IN CONSIDERATION OF THE CITY'S AGREEMENT, IN THE EVENT THE CITY IS ABLE TO SUCCESSFULLY NEGOTIATE SAID AGREEMENTS, TO LIMIT THE NUMBER OF COMMERCIAL HAULERS TO FOUR (4), FOR THE DURATION OF SAID AGREEMENTS. WHEREAS, the City currently has four non-exclusive franchises for the collection of solid waste from commercial properties in the City; and WHEREAS, the Sanitation Department currently has an accumulated deficit in its Enterprise Fund of approximately $800,000, and is currently operating with a deficit; and WHEREAS, the existing four non-exclusive franchise licensees: Browning-Ferris Industries; Davis Sanitation, Inc.; Westside Sanitation; and Waste Management of Dade County-North have expressed an interest in providing additional sanitation services to the City, in exchange for not increasing the number of commercial haulers; and WHEREAS, the provision of additional services to the City could generate a considerable cost savings to the City in internal operations and disposal fees. WHEREAS, the four non-exclusive franchises will not raise fees as a result of this agreement. NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Administration is authorized to negotiate agreements with the four existing non-exclusive franchise licensees: Browning-Ferris Industries; Davis Sanitation, Inc.; Imperial Sanitation Service; and Waste Management of Dade County- North, to provide additional sanitation services to the City, at no cost to the City, in consideration of the City's agreement, in the event the City is able to successfully negotiate said agreements, to limit the number of commercial haulers to four (4), for the duration of said agreements; said agreement to be reviewed by the Mayor and City Commission bi-annually, to insure that fees charged by the haulers have not been increased as a result of this agreement. ~ MAYOR PASSED and ADOPTED this 21stday of July, 1999. r APPROVED A..c, TO FORl'A & LANGUAGE & FOR EXECUTIO;o"j ATTEST: ~dv- CITY CLERK ,;' SRlMDS/jph TIAGENDA \ 1999\JUL0799\REGULAR\W ASTE-REWPD / /, ATTACHMENT A CITY OF MIAMI BEACH ~ ,"' ,. - I OFFICE OF THE CITY ATTORNEY" MEMORANDUM TO: Ronnie Singer' Executive Assistant to the City Manager /.JC~ Raul J. Aguila (/ . r- First Assistant City Attorney " FROM: SUBJECT: Selection of Franchise Waste Contractors DATE: April 20, 1999 I Pursuant to the direction of the City Manager at After Action on April 15, 1999, I am attaching a copy of Sections 90-229 and 90-230 of the Miami Beach City Code, regarding selection of F ranchise Waste Contractors, and renewal of existing contracts. As you will note in Section 90-229(a), with the exception to provide for recycling, the City sballlicense not more than five (5) franchise waste contractors for residential and commercial waste collections and disposals. Therefore, should one of the existing five franchise agreements be terminated, or otherwise expire, the City may elect to license a new fifth franchisee or, in the alternative, maintain a lessor number of franchisees. In the event that the City opted to maintain less than five (5) franchisees, an amendment to this Section would not be required; however, should the City ever wish to have more than five, an amepdment would be necessary. The criteria for the selection of franchise waste contractors is set forth in Section 90-229 and is self-explanatory. Please note that the Mayor and City Commission recently approved an amendment to this Section, allowing potential franchisees to show either a minimum of fifty (50) committed accounts within the City or, in the alternative, and at the discretion of the Mayor and City Commission, fifty (50) comparable committed accounts from outside of the City. in satisfying the minimum qualifications to be considered in the granting of a franchise agreement. The Mayor and City Commission has the discretion to either issue franchise agreements to new applicants, subject to compliance with the minimum qualifications, as set forth in Section 90- 229, or issue a new license to existing franchisees. You have raised the questions as to whether, should the City wish to solicit new applicants for franchise agreements, the competitive bidding process is appropriate. ~ As you informed me, the City has historically awarded franchise agreements pursuant to the aforementioned Code provisions, and not through either a bid or request for proposals process. However, as Section 90-229 was recently amended to allow potential franchisees to submit either fifty committed accounts within the City (which understandably limited the amount of potential available franchisees in the past) or, in the alternative, fifty comparable committed accounts outside of the City, a competitive bidding process might now be desirable. Notwithstanding the foregoing, *' any selection process must clearly reflect and delineate the minimum qualifications to be considered in the granting offranchise agreements, as set forth in Section 90-229. Should you have any questions or comments regarding the above, please do not hesitate to contact me. RJA/kw F:\ATrOlAGUIlIMEMOSIFRNCHSEL.RS Attachments cc: Murray H. Dubbin, City Attorney Sergio Rodriguez, City Manager Robert Thomas, Sanitation Director 2 .... ,. II II . j . . j j j t II j ~ ~ t t I I ATTACHMENT B ONYX FLORIDA LLC ~ON>X ~ = ~ :::: : \ J :-- r-. j :.!.- V __: .4 C. ~ 99 MAR r 7 Pl1 3: S . i ,.::/ 8~~ i. : J i-:i-. ~i::~ . :=v ".' , - March 17, 1999 Mr. Sergio Rodriguez City Manager City of Miami Beach 1700 Convention Center Drive Miami Beach, Ronda 33139 Re: Merger of Waste Management and Eastern Environmental Services Dear Mr. Rodriguez: As you know, the Miami Beach business community has had its choice of waste service providers greatly reduced since this last January. - . Encosed is an article describing the merger of Waste Management and Eastern Environmental Services. This merger has . er of commercial waste competitors avaIlable in Miami Bea I respedfuIly submit for the City's consideration that the City license ONYX Rorida as the fifth franchisee. ONYX has, since fast Odober, provided an Ow~~-;diiig lsvel of service to the residents of the City through its residential coffection service, and we have greatly improved the appearance and deanliness of the Stash Area J Our fleet of trucks is already operating throughout the City, and filfinc the fifth cosmon with another franchisee would add a sixth carbaoe truck fleet to the City streets. Tnis request is in conformance with the City's current Franchise Ordinance, which aIlows the City to directly license any qualified \V2ste service provider it chooses based on ..... the current garbage, trash, and \V2ste disposal needs of the City..... -~., - . ,."-- cv"-ue .:~ F:~C"'~ -=--; ':..:la:_ ~~ ~ _-. ~..:::_~ ='Vrc.:....,. _d . ~---~'~.- . ~ ..-.,"..-,.. ~..- ./" .../ Mr. Sergio Rodriguez March 17,1999 Page -2- Of coursa, licensing ONYX Ronda as the fifLh franchisee does not imolv . ar.v cost whatsoever to t~ C:tv. We merely are aJlp\ved the opportl....,ity to compete on price and service with the remaining franchisees. Please advise how you would like to proceec on this time-sensitive matter. Sincerely, /' ~ -- 7 C -, --? Leonard N. Enriquez Vice President-Business Development LNElmt 11031799.lne enclosure cc: Hon. Neisen Kasdin.. Mayor Hon. Nancy Liebman, Vice Mayor Commissioner Simon Cruz Commissioner David Dermer Commissioner Susan Gottlieb Commissioner Martin Shapiro Commissioner Jose Smith Ms. Ronnie Singer, Assi~&.Ont City Manager Mr. Raul ~guila, Esquire, Assis"'~ City Attorney .. II I , . . t I I II Iii i ~ i II - - I I I ! I I - 07/06/99 13:43 TEL 3056332973 BFI ~IIAMI @02 ATTACHMENT C I;,l BF' July 6, 1999 Mr. Matthew D. Schwartz Assistant City Manager City of Miami Beach 1700 Convention Center Drive Miami Beach, Florida 33139 Re: Sanitation Services Dear Mr. Schwartz: We are in receipt of your letter of June 29, 1999 regarding the abovt! mentioned topic. As was discussed at our last meeting, having the f'ur current haulers collect the waste at the city facilities named in your Il!tter and provide the three 30 yard roll off containers is acceptable. We c:>ncur with the concept. If further discussion is required please do not hesitate to call me at 305-63B- 3800 extension 201. 3840 NW 37 COlin' Miami, Florida 33141 Phone 305.638.3~00 - Fax 305.634-4272 JO'1~ PO!t-Cori,ufTler c0.d ltllOl VW~ WASTE MANAGEMENT 2125 NW I 0 Court Miami, Florid:! 31127 (05) 4il.4444 July 1,1999 Mr. Ma1hew D. Schwartz Assista 1t City Manager City of lv1iami Beach 1700 C Jnvention Center Drive Miami Eleach, FL 33139 Re: Sanitation Services Dear Mr. Schwartz: In resp':mse to your letter of June 29, 1999, Waste Management Inc. of Florida agrees with the concept of in kind.services to the city. Our ccmpany will participate with the three other franchisees in providing complete waste service to the city facilities listed in your Jetter as well as servicirlg the three roll-off containers to be placed at the parks division. We believe that these services will free city crews to perform other work as well as saVEl the city considerable collection and disposal fees. This continued cooperation between the public and private sector will provide the solution to the budget deficit problem as well as enhance the right of way clean- up pro"ram. If you have any questions or need any further assistance please call me at any time. Sincemly, G Arthur M. D'Onofrio Oivisio, Manager A Divisiol1l1f""\tste M;tnll!:"mem In,~. ofFI,'ri,l;\ c0/c0'd I N::JI.I::Jt1I-lt-.11-l1.1 ::J I CI-lNl rr.~~ rrrT n~ ~In~ Ray Davis tRay Davis Jr. Family Owned 8. Operated Free Estimating Trash 8. Garbage Hauling DA VIS SANlT A TION, INC. 850 IVES DAIRY ROAD, SUITE T98 SORTH MIAMI BEACH, FLORIDA 33179 (305) 653-1684 PHONE (305) 653-9040 FAX July 12, 1999 Dear Mr Schwartz, This letter is being sent to confirm that Davis Sanitation, Inc~ will participate in providing additional services to the City of Miami Beach of trash removal and recycling services. If we can assist you in any other way please call my office. Thank You, Owner-President JUL-13-99 03:30 PM IMPERIAL. SANITATION 8882792 P.04 July 13, 1999 City of r...1iarni Beach 1700 Convention Center Drive Miami Beach, Florida 33139 Attn: Mr. Matthew D. Schartz Assistant City Manager This letter is to serve as written confirmation that LazaroRecycling,'Imperial Sanitation is interested in participating with the other existing City of Miami Beach commercial haulers in providing additional services to the City. I have reviewed the listing of city facilities and see no problem in sClvicing my fair share of locations. I look forward to further discussion on the issue at the City Commission meeting July 21, 1999. Respectfully, 8180 N.W. 93rd Street · Medley, Florida 33166 · (305) 888-5515 CITY OF MIAMI BEACH CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 http:\\ci.miami-beach.f).us COMMISSION MEMORANDUM NO. 5 8t, Lf5 TO: Mayor Neisen O. Kasdin and Members of the City Co ission DATE: July 21,1999 FROM: Sergio Rodriguez City Manager SUBJECT: A RESOL ON OF THE MAYOR AND THE CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE CITY ~AGERTONEGOTMTEASER~CEAGREEMrnNT~THTHEFOUR NON-EXCLUSIVE FRANCHISE LICENSEES, BROWNING-FERRIS INDUSTRIES, DAVIS SANITATION, INC., WESTSIDE SANITATION, AND WASTE ~AGEMENT OF DADE COUNTY-NORTH, TO PRO~DE ADDITIONAL SER~CES TO THE CITY AT NO COST. ADMINISTRATION RECOMMENDATION: Adopt the Resolution. BACKGROUND: The Sanitation Department has a FY 98/99 budget of $4.7 million dollars and operates as an Enterprise Fund. It has accrued a deficit of over $800,000 through FY 98/99. In an effort to reduce this deficit, the Sanitation Department has proposed several fee increases which the City Commission did not support. The Sanitation Department was directed to present their proposals to the Finance and Citywide Projects Committee which met on June 15, 1999. At this meeting, it was suggested that the City approach the existing four commercial franchisees to discuss additional servIces. The City Administration met with the four haulers on June 25, 1999 to discuss seeking their assistance in reducing the deficit by providing additional revenue and/or reducing the cost of sanitation services provided to the City. The haulers expressed a strong interest in providing assistance if the City would agree not to fill the fifth commercial franchise slot which became vacant as a result of the merger of Waste Management and Eastern Environmental Services. The City is not mandated to have five commercial haulers. (Note Attachment A.) Based on revenues paid to the City, the existing distribution of volume of business is as follows: Browning - F ems Industries Davis Sanitation, Inc. Westside Sanitation Waste Management of Dade County-North 24.7% 5.9% 23.0% 46.4% Agenda Item R 'l 0 Date 1-2l-qq The Administration, along with the haulers, has discussed several proposals that will decrease costs to the City. The proposed additional services that would be provided by the haulers at no cost include: The provision of waste collection and removal services for ALL City owned properties and facilities at no cost. This service is currently provided by the Sanitation Department. Estimated cost saving to the City for this service is approximately $136,000 annually. The provision of three 30-yard rolloff containers to be utilized by the City for debris which the licensees will empty a minimum of three times per week. The City currently pays the disposal cost. Estimated cost saving of this service is approximately $100,000 annually. Providing these waste collection and removal services for ALL City-owned properties and facilities (operated by the City) will save the Sanitation Department an estimated $236,000 annually. Onyx Florida LLC (Montenay International Corporation) has requested that it be given consideration as the fifth commercial hauler (Attachment B). They presently hold the residential contract. Meetings were held with representatives of Onyx on June 25, July 1 and July 13, 1999 to discuss services that they would provide for the City to help reduce the existing Sanitation Enterprise Fund deficit. Initial discussions focused on Onyx contracting to undertake the Citywide Right-Of-Way Cleanup Program and removal of park debris. At the meeting of July 13, 1999, Onyx indicated that they were unable to assume additional services that would be provided at a subsidized cost to the City. ANAL YSIS At the July 7, 1999 Commission Meeting, the City Commission directed the Administration to review alternatives and provide a recommendation that would provide the largest financial benefit to the City as well as the continuation of competitive services for commercial trash collection. The three alternatives that were reviewed include: Entering into an agreement with the existing four commercial haulers for additional services provided at no cost to the City and not fill the existing fifth slot. Estimated cost saving to the City is $236,000 annually. (See Attachment C.) Granting the fifth commercial franchise slot to Onyx Florida LLC without issuing a Request for Qualifications. Opening the fifth slot to a competitive Request for Qualifications. This would preclude the City from requiring additional services in order to be consistent with previous solicitation of sanitation services; thus, there would be no additional economic benefit to the City. Issues presented by representatives of the existing four commercial haulers and Onyx at the July 7, 1999 Commission Meeting include: Competition A major objective of the City is to ensure the provision of competitively priced sanitation services for commercial accounts. The existing four haulers provide a competitive situation for trash collection since they all operate throughout the City. The establishment of a maximum of five franchises was based on the number doing business in the City at the time it created the licensing and operating criteria for non-exclusive waste contractors. The number of commercial haulers ranges significantly among cities (ranging from one in Coral Gables to over thirty in Dade County). Availability of Fifth Slot The merger of Waste Management and Eastern Environmental Services has resulted in the elimination of one of the existing five franchises. Waste Management indicated at the July 7, 1999 Commission Meeting that it still retains the fifth license. There has not been any change in service or noted level of customer satisfaction as a result of the merger. Review by the City Attorney has indicated that the merger of Eastern Environmental and Waste Management resulted in a forfeiture of the fifth franchise. No City approvals were needed per Section 90-192 (f) of the City Code which permits the assignment and transfer of franchise licenses of companies whose stock is traded over the New York or American Stock Exchange or that are institutional lenders. Waste Management is a publicly traded corporation and thus did not need City approval. However, pursuant to City Code Section 90-229 (a) (5), as one of the minimum qualifications for a franchise waste contractor, no franchisee throughout the term of the franchise can be affiliated with any existing licensee. Therefore, the City Attorney has opined that, upon merger of Eastern Environmental with Waste Management, the fifth franchise became available. As noted previously, the City is not mandated to fill this position. CONCLUSION Even though there may be a short-term benefit to the user with an additional hauler who may initially be more competitive in pricing, pricing and services tend to be fairly consistent among the firms in the long term. The City Administration recommends that the Mayor and the City Commission adopt the attached Resolution authorizing the City Manager to negotiate a Service Agreement with the four non- exclusive franchise licensees: Browning-Ferris Industries; Davis Sanitation, Inc.; Westside Sanitation; and Waste Management of Dade County - North, to provide additional services to the City at no cost. The value of these services would be approximately $236,000. This proposal provides a significant cost saving to the City without having to raise fees that would be directly passed on to the commercial accounts in the form of higher franchise fees. It is recommended that this agreement be for a two-year period. aJC~ SR:~S/jph T:IAGENDA \1999\JUL2199\REGULAR\W ASTE-CM