SR-504-001 (2)
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DEe 1 2 1978
Santa Monlca, California
November 29, 1978
To:
Mayor and City Council
From:
City Staff
Subject:
Long Range Refuse Disposal Alternatives
Introduct10n
Solid waste management in any jurisdiction is composed of two basic
functions: (1) Solid waste collection; and (2) SOl1d waste d1sposal.
The solid waste management system in Santa Monica is fundamentally sound,
providing efficient collect1on methods and utilizing a City owned transfer
station in the disposal function. The use of the transfer station produces
long-term cost savings in the disposal operation.
The refuse collectlon function in Santa Monica should continue to operate
eff1ciently in the future and in th1S regard the ~eD2rblent of General
Services is continuously investigating new or improved refuse collection
techniques.
However, the disposal function in Santa Monica's solid waste management
system faces an environment of future uncertainty. The major elements of
uncertainty are:
1. Where will refuse be disposed? That is~ which landfill sites
will be available to Santa Monica in the long term?
2. When will full scale resource recovery or energy conversion
plants be economically feasible and available for use by
Santa Monica?
3. The present transfer facility 1S 10 need of upgrading. What
level of investment 1S required?
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DEe 1 2 1978
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To:
Mayor and City Council
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November 29, 1978
4. There exists uncertainty as to what governmental regulations
will be formulated in the future that will affect solid waste
disposal. SOlld waste disposal and energy conversion from
solid waste are rapidly becoming significant political issues.
In view of these uncertainties, decisions should be made as to the appro-
priate course of action to be taken in order to achieve the goals of
efficient and effective waste disposal at the lowest possible cost.
Bapkground
The Refuse Disposal Problem
The problem facing Santa Monlca regarding solid waste disposal is deciding
upon a course of action that will best prepare the City for uncertalnties of
the future that are related to the solid waste issue.
Mission Canyon Landfill
For the last twenty years Santa Monica has been using the nearby Misslon
Canyon Landfill as a final dlsposal site for municipal solid waste. This
landfill is located ln the Sepulveda Pass area and is operated by the Los
Angeles County Sanitatlon District. The landfill has a remaining life
(capacity) of 20 to 40 years, but environmental concerns and political
pressures from property owners located adjacent to the landfill have caused
the City Council of Los Angeles to deny the condltional use permit required
for continued operation of this landfill.
The Sanltation Districts are presently ope~ating a landfill on prlvate
property in the Sepulveda Pass area known as Canyon Eight. This facility
will be exhausted within 2~ to 3~ years. In the meantime, Sanitation
District officials are attempting to design an operation for the Mission
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To'
Mayor and City Council
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November 29, 1978
Canyon site that will mitigate unpleasant environmental factors and be
acceptable to the Los Angeles City Planning CommIssion and City Council.
If the DIstricts are successful in obtaining a conditional use permit,
then Santa Monica may continue to use this relatively nearby landfill for
at least another fIve to eight years depending on the length of the permit.
However. if the conditional use permit is not granted and the Mission Canyon
Landfill site IS permanently closed, Santa Monica will be faced with haulIng
refuse at least three times as far to the nearest available landfill located
either in LaPuente or West Covina. This factor would add a minimum of
$150,000 of additional cost per year to the refuse disposal operation, or it
may dictate alternat1ve solutions.
It is diffIcult to predict the eventual outcome of the Mission Canyon situation~
What is known is that there will be substantial additional costs to Santa
Monica if Mission Canyon closes and no other nearby alternative landfill site
1S available.
Transfer Stat10n Requirements
Presently Santa MonIca operates a CIty-owned transfer facility composed of an
open air dump area where collection trucks dump the refuse. The refuse is
then pushed into a lower level compaction ram which compacts the refuse
into heavy duty, large capac1ty transfer trailers. This process enables
three collectIon truck loads to be compacted (transferred) into one transfer
trailer which is then hauled to the landfIll by a heavy duty diesel tractor.
The savings result1ng from labor and equipment that would De used if collection
trucks were to haul directly to the landfill is much greater than the cost of
operating the transfer facility. This results in an overall lower cost of
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To:
Mayor and City Council
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November 29, 1978
the total solid waste management operation. In fact, this amount of
savings increases if the haul distance to the landfill increases. For
this reason, the continued use of a transfer station should be a part of
any future plan for refuse disposal. However, the eXlsting transfer
facillty is nearly twenty years old. The Ram Compactor is in need of an
overhaul or replacement to improve compaction efficiency. Also, the open
air dumping operation, although presently acceptable to regulatory agencies,
is aesthetically unpleasing and most probably will be subject to enclosure
as more specific regulations regarding transfer stations become formulated
by the County and State.
Some level of investment 1S required to update the transfer station.
Decisions must be made as to whether the facility should be expanded and
enclosed at this time or whether a minimum investment for simply refur-
bishlng the present machlnery is to be made.
Uncertainty of Future Costs
Any type of planning, especially long term planning, deals with uncertainty
of future costs. In the set of costs that make up the total cost of the
refuse disposal operations, there are certain components that are subject to
unexpected fluctuations. The cost of fuel is one cost factor that would
increase dramatlcally if there were to be another OPEC oil embargo. Also,
landfill dumping fees are not easily projected. Stricter environmental
requirements are rapidly addlng to the operation costs of landfills. Also,
refuse disposal fees are becoming attractive areas for government imposed
surcharges and use taxes. All these factors lead to cost increases that
exceed projections based on inflation.
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To:
Mayor and City Counci1
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November 29, 1978
These factors are important in a long range decision. A plan that
provides very inexpensive landfill cost but at a relatively long hauling
dlstance might look attractive given present conditions. However, if
fuel costs rise disproportionately it may be that the use of a higher cost
landfill located relatively close would be the best long term solution.
Re?ource Recovery
Because there is an increasing awareness of a need to conserve natural
resources, efforts are increasing to develop methods to convert solid
waste materials into useful purposes rather than continuing to bury them
in landfills. However, due to technolog1cal and economic barriers, resource
recovery is not at a development stage to be considered a viable near term
alternative to landfilling.
There are many types of resource recovery processes. The following
paragraphs will briefly describe the various processes and the current
state of development.
Source Separation Programs
Source separation involves the voluntary removal of recyclable materials
(aluminim, newspaper, steel) by residents prior to collectlon. Although
these operations do reduce the waste flow to landfills slightly, the cost
of the operatlon greatly exceeds the revenue generated by the recovered
materlals. Even if source separation were entirely successful, there would
still remain more than 90% of municipal refuse that would requlre landfilling.
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To:
Mayor and City Council
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November 29, 1978
Energy Recovery from Solid Waste
There are several types of energy conversion processes in various stages
of development to convert combustible solid waste into energy. The processes
include direct burning of refuse in conjunction with a conventional fuel to
generate steam, or a more complex process of refining refuse lnto a type of
fuel oil (pyrolysis). There have been great expectations for these processes,
but with very little results from the pilot plants that have been constructed.
In Southern Californ1a there presently are not any operating energy con-
version from refuse plants. There are plans for a steam generatlng facility
utilizing refuse derlved by fuel to be located in Long Beach. ThlS plant
will be relatively large scale (1,000 ton per day) and is to be built and
operated jointly by the City of Long Beach, Los Angeles County Sanitation
Districts, and the State Solid Waste Management Board. The earliest time
that this plant could be operational is 1983.
Even with the successful implementation of an energy-fram-refuse converSlon
process, it is estimated that there will be a residue of 25% to 35% composed
of ash and non-combustlbles that will require landfilling.
Based on the current state of resource recovery systems and the projected
rate of development, this report will not consider any of these systems as
feasible alternatives to landfilling of municipal refuse for at least 10 years.
This does not mean that efforts toward recycling and resource recovery should
not continue; but rather, it does not realistically appear that substantial
decreases in the waste flow will result from these processes for at least
10 years.
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To:
Mayor and City Council
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November 29, 1978
In summary, the refuse disposal problem facing Santa ~bnica is to select a
course of action that will maximize the effectiveness of dlsposing of solid
wastes and minimize the assoclated costs in an uncertain environment as
described above.
Alternatives
By already operat1ng a City owned transfer station, Santa Monica has achieved
the most important step toward solving the long-range refuse disposal problem.
Most solid waste managers agree that a local transfer station is essential
to any solid waste collection and disposal operation that requires a haul
of 10 miles or more from point of collection to the point of disposal. With
the impending closing of Palos Verdes landfill in 1980 and possible closing
of Mission Canyon in 1981, most other cities ln Southwest Los Angeles County
are faced wlth the prospect of building their own transfer station or
contracting with an existing private transfer station.
The Santa Monica transfer station is old and in need of improvements. There
are two alternatives available for providing these improvements as part of
the long-range disposal plan.
1. t1aintain City Operation. The City will decide on the amount of
1nvestment required to improve the transfer station, finance the
improvements, and continue to operate the transfer faClllty in
essentlally the same manner as the present operatlon. By maintaining
City control of the operationt the solid waste situation can be
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To: Mayor and City Council
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November 29, 1978
mon1tored, and 1f conditions seem favorable the City could engage in
a program of expanding the facility as a regional transfer facility.
This type of program could be financially beneficial to the City as
well as other local refuse haulers.
2. Contract with a pr1vate company to remodel, expand, and operate the
transfer facility in exchange for a reduced cost of disposal. This
alternative is available due to the fact that BKK Corporation, a private
company experienced 1n solid waste disposal operations, has submitted
an unsolicited proposal with the following major features:
(l) BKK will assume operation of the Clty owned transfer station
and will utilize their own landfill in West Covina as the
disposal site.
(2) BKK will remodel, expand, and enclose the Santa Monica facility
and offer use of the fac1lity to other local haulers and the
public in addition to the City collection fleet.
(3) BKK will charge Santa Monica a fixed rate per ton which is
projected to be slightly less than the present City d1sposal
cost per ton.
(4) BKK will charge other haulers a hlgher rate (lO% higher), of
Wh1Ch a portion will be returned to the City.
(5) The initial agreement will be for a ten-year period with an
option for an additional 10 year term. (See Appendlx A for
text of the proposal).
Analysis of Alternatives
Financial Considerations
The financial analysis of the alternatives presented is complex and laced
with uncertainty. Long-term financial impacts must be based on assumptions
and projections that, at best, are educated guesses.
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To: ~~yor and City Council
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November 29, 1978
The 1ong-term financial impact of the alternatives is presented in Figure I.
The costs derived were based on the assumptlOns presented in Exhibit "I".
1,100,000
Cost
to
City 1,000,000
900,000
800,000
700,000
600,000
500,000
400,000
1,100,000
I
1,000,000 1-
900,000 I
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800,000 L
700,000
600,000
500,000
400,000
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Refurbish
Trans fer
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1 _~~_ __L ___ ~H______L_~ _ _J___ _ L_~ '_ ____ _ I___--.!..
78 79 80 81 82 83 84 85 86 87
Mlsslon Canyon Remains Open at Least 10 Years.
I~ 1_ I __ _ J ______L___I ___L___l
78 79 80 81 82 83 84 85
Mlssion Canyon Closed in 1981.
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To:
Mayor and City Council
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November 29, 1978
The cost projections were made based on two criteria. One criterion is that
Mission Canyon remains open for at least another 10 years. The other criterlon
is that Mission Canyon will close permanently within three years.
If 1t is possible to work out a compromise and continue the operation
of the Mission Canyon Landfill for at least 10 years, then the projected costs
for maintaining a City operated transfer facility are nearly the same as the
as the costs projected from the fees that would be charged by BKK under their
proposals. However~ if Mission Canyon closes, then the BKK proposal appears to
have a substantial financial advantage.
Using the Mission Canyon status as the sole criterion, 1t would seem clear that
the BKK proposal would be the desirable alternative. There are, however, many
other conslderat1ons in this decision.
Santa Monica could conduct the expansion without BKK and if there is sufficient
demand for such a facility from other haulers, the City could probably equal or
exceed the cost saving results. The advantage of using BKK is that no capital
outlay is required and a low cost landfill would be ava1lable for the long run.
If Mission Canyon does not close, there is a real question whether other local
haulers would be interested in using a transfer facil1ty. The present facility
has been made available to the City of Beverly Hills and one local private
hau1er. To date there has been very little use of the transfer station by
either of these two haulers, presumably because the $8.00 per ton fee is
prohibitive.
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To:
Mayor and Clty Council
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November 29, 1978
In summary, if Mission Canyon closes and Santa Monica makes no effort to
expand the transfer facility on its own, then the BKK proposal appears
financially beneficial. If Mission Canyon remains open there still would be
some financial advantage to the BKK proposal, but not nearly as large.
Management Control
Careful consideration must be glven whenever management control of a vital
service lS at stake. Under the BKK proposal, full management control of the
transfer facility would shift from the City to BKK.
Political Considerations
Conductlng public works with private firms is not a new concept. However,
replacing a publicly operated functlon with a private operation may may
indicate to the public that a private firm can conduct this operation more
efficiently and at less cost than the City. This is not necessarily the
case in this sltuation. The advantage that B~K has lS the ease of obtaining
long-term capital financing for construction of the modernized facility.
Planning
The mixing of private and public forces in the SOlld waste management operat1on
could inh1bit the planning of long-range projects. A long-term contract with
BKK would essent1ally tle up the use of the transfer station property for the
term of this contract. If a more attractive alternative use of this land
were to arise, the City could be faced with a difficult and expensive task of
buying out of the contractual obligatlons with BKK.
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To: Mayor and City Council
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November 29, 1978
Summary of Alternat1ves Analyses
Alternative 1, Malntain City Control
Advantages:
1. Retainin~ management flexibility. Due to the uncertainty surrounding
the Misslon Canyon situation, resource recovery and the solid waste
environment 1n general, it may be to the C1ty.S advantage to avoid
locking in to a long-term commibment with a prlvate firm.
2. If conditions warranted, the City could conduct their own transfer
station expansion program and thus become a leader in the West County
by provid1ng a necessary and effective service that could be utilized
by surrounding communities. Revenue from such an operation would also
help hold down total solid waste management costs to the residents
of Santa Monica.
Disadvantages:
1. There are many uncertainties as to the availability of a final disposal
site for Santa Monica under Alternative 1.
2. Maintaining the present operation may be more costly to the City than
Alternative 2, especially if Mission Canyon is permanently closed.
3. There are certain capital expenditures necessary to refurbish the
present transfer station machinery if the C1ty maintains control of
the operation.
Alter~atlve 2., the BKK Proposal
Advantages:
1. Provldes City with a long-term solution to the refuse d1sposal problem.
2. Provides a modern, expanded transfer fac1lity that will become property
of the City at the end of the contract period.
3. Based on long-range projections, the BKK proposal appears to be finan-
cially more desirable to the City than Alternative 1.
4. The new facility wlll be open to other local haulers as well as the
publlC 1n general which may result in less illegal dump1n9 within the
City.
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To: Mayor and City Council
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November 29, 1978
D1sadvantag€s:
1. Removes the refuse d1sposa1 operation from direct Clty management
control. Disagreements in management pract1ces will require negotiated
settlements.
2. Requires 7 to 9 present employees of the City to accept employment
with BKK or seek other employment.
3. Long term contract could inhibit planning alternatives relatlng to
the transfer station property.
Recommendations
Previous sections of this report have described the refuse disposal problems
that Santa Monica is faced with, presented the feas1ble alternatives avallable
to help solve the problems, and discussed and analyzed these alternat1ves.
Staff recommends that Council approve the concept of contracting for transfer
station operations for the purpose of provid1ng a long-range and reasonable
cost solution to the solid waste disposal problem in the City.
It is recommended that Council direct City Staff to enter contract negotiations
with the BKK Corporation for the purpose of returning to the Council a contract
for consideration.
If it 15 Council's desire not to pursue the BKK proposal, then staff is
prepared to implement alternative courses of action to effectively meet the
refuse disposal needs of the City whether or not Mission Canyon remains open.
Prepared by: Stan Scholl
Neil Miller
Attachment: Proposal to City of Santa Monica from BKK Corporation
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EXHIBIT "J"
BKK PROPOSAL ANALYSIS
Assumptions Re: BKK Operation
1. Fixed faCll1ty cost remalns constant at $26,850, based on 5.8% of
1 n it i a 1 ra te .
2. All component costs will increase at 7% per year except f1xed facility
amort1zation.
3. Estimated tonnage from other users:
1980/81 50 tons/day (earliest feasible year for
expanded operat1on)
1981/82 100 tons/day
1983-1988 200 tons/day
4. Total expanded plant capacity -- 500 tons/day.
5. Rate/ton to others will be 10.0% higher than charged to Santa Monica.
(based on original rates presented in proposal)
Assumptions Re: Santa Monica1s Operation
1. Santa Monica present disposal cost per ton
(includes .25 landfill surcharge
7.80 to be charged as of 1/1/79).
2. Santa Monica cost factors will increase 7% per year.
3. Santa Monica tonnage will increase 3% per year (based on past 7-year
average increase).
4. Assume min1mum $30,000 transfer station refurbishing cost to take
place 1979/80.
5. Veh1cle depreciation (Santa Monica) based on 5-year life to conform
with BKK proposal.
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3031 EAST 1 STREET. WILMINGTON CALIFORNIA 90744 . (213) 775-3607
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~ 10, 1978
City of Santa M:mica
City Hall
1685 Y::Iin Street
Santa Mxrl.ca, CA 90401
Attention: Mr. Stanley Scholl
Director, General Services
Gentlenen:
Bl<K Corporation is pI P::t~ed to submit herewith the BlJE[ldnEnt of
its fo~l unsolicited pivposal to provide an effective, long-tenn
refuse disposal solution for the City of Santa M:nica. 'Ibis pro-
posal. which incorpm;:at,=~ the nxY!in.cations cooch~ fran the 1MTlY
conferences over the past six tIIJl1ths between ~ and City repre-
sentatives, supersedes our Jm.e 14, 1978 proposal in its entirety.
'Though the attached pLuposal rffMiT'lS relatively brief in its presenta-
tion, 'We wish to ~hasize that a great ~~l of detailed study and
p1.cu-JiUng--ree.crrding operationsl analysis, cost evaluation, faci lity de-
sign and constrl1ction--underlie and support this proposal. As a result,
BKK CorJxrration is prepared to JIDVe fo1:ward :fJmlpt:ti::ttely .into contract
negotiations and program inplem?'ntation should the City favorably vietr1
our offering.
The uncert~;nty of the continuing long-tFnn avai' Ahility of a
nearby landfill for disposal of the City I s refuse and the high, ever-
increasing costs associated with Santa M::mica' s present tram;fer/
disposal system are problPJTl!'; which are 'Well mderstood by City officials.
The BKK proposal r1il"'ectly addresses these problt:ffLS and other pertinent
issues, and provides a program which affords the City with the following
salient benefits:
1. The City will real i.ze an :imIeiliAte anrn-'~' cost savings of about
$30,000 to $40,000 or nnre. Equivalent or gLca.ter savings can
be expected during every succeeding year of the BKK program.
Further, sizeable c~ita1 investIIent requirerents t..lu1t the City
Y.Uuld otherwise confront periodically will be avoided. These
fiscal relief benefits should be particularly :i.rrportant in view
of budgetary constraints resulting fran the recent passage of
Proposition 13.
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2. The City wnrbave an assured pl,::a~ and capacity for disposal of
its solid waste far 20 YP>;IrB (or longer). Thus, pL-csent uncer-
tainties ree~Tding cmtimJed landfill1ng in the Sepulveda Pass
(Mission Canym) area, and the City's virtn.ql dependence en future
actions by both the Colnty and City of IDs Angeles, can be elimi-
nated.
3. BKl('s pL:u~lfed 1U:ldemizatiat of Santa Mrdca's transfer station
will substanriJll1ly i~ the env:i..J.:ul.lu.~lrAl aspects of the present
operation--by provisim of an enclosed fad lity. 'The lILublems of
unsig}:1tly appeiu:ai1Ce, the presence of large fYl_Trhers of scavenging -
birds, papers and debris being blown about by the wind, etc., will
be eUmiTlated.
4. At present, the City's residenti.ql properties and only SCWTF' busi-
nesses benefit frcm the transfer station operation. With BKK's
planned facility renovat1.cn, all of Santa Mx1ica's ccmrerci,q-1 and
inrlt_"L~tria1 finnA, schx>ls, hospitals, etc., 'WOUld likewise be able
to benefit from the cost-effective, long-tenn waste disposal
solution available.
We hope that the attached revised pwpOsal is now sufficiently ccm-
plete and clpm-- to pe1:mlt an pJlTly decision by the City. Should addi-
tional infOl.1Dation or ckification be desired, Pl<K representatives
stand ~!lIiy to i~iJltely prvvide such. P]P.qRe cont~(!t the undersigned
for infonm.ticn or assistance.
,
Sin~~ly,
_ 7\ OJRPORATICN
~~~.\~
~d M. Tinnan
Vice President - Teclmi~~'f
Un' : be
Enclosure
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3031 EAST I STREET · WILMINGTON, CALIFORNIA 90744 . (213) 775-3607
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NovH'-:-er 10, 1978
PROPOSAL 'ID CTI"l OF BANIA M:M.CA
The Problem:
1. }tnicipally-operated refuse collection vehicles DlJSt dispose of
p;!t:'h day (}bnday through Saturday) an aver~~ of 200 tans of solid
waste collected frcm residences and S~ business properties within
the City of Santa }bnica. Since there does rot exist. nor is there
plarU1ed. any facility within the City ('~le of providing for the
ultimate disposal of such wastes, the City nust ~ on the
availability of a suitable cti sposal capacity pLvvided by others
and located outside of the City's bolmrl:rri.es.
2. In arklition, the businesses, inchJstry and other institutions
located within the City ~se refuse collection needs are ser-
viced by conIIErcm 1 h~lnl ers, generate an estimated 100 tons per
day of acfr:H tiona! refuse ~ch likewise lIllSt be ~hly and eco-
t'a.Jw.i..ca11 y disposed.
3. The Canyon 8 landfill in the Sepulveda Pass area (operated by the
Los Angeles Cbtnty Sanitation Districts) which currently serves as
the disposal facility for the City's residenH::!l and camercial
solid wastes is expected to be full, and tln.ts will close, in early
1981. The landfill operator's application for a pemd.t to use the
nearby Mission Canyon as a continuing landfill, i.e. I after the
Canyon 8 closure, was denied in ~~"'ly 1978 by a np~",-unanirrDus vote
of the los Angeles City Council. Ihless a major change in the IDs
Angeles City Cmnci.l posture should occur I no ~~-roy landfill will
exist for Santa futica-generated wastes in about ~ years.
4. The City's transfer station, which provides the baul-to-landfill
function for the mmicipa1ly operated refuse collection tn1cks, is
now quite old, seriously out:Imded and I!EChaniC'811y inefficient.
It has been estimated by City personnel that the present transfer
station operation costs about 57.80 to $8.00 per too (including
the current landfill ch.Irping c..1-w:'ge of $3. 50 per ton).
Purpose and, ~"ajor Features of tr..e BFl~ Profx>sal:
To provide the City of Santa. M:mica (hereinafter "the City") mth an
assured long-tem waste disposal solution that will also provide size-
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able iImerliAte and contfuuing cost savings. These objectives Ill':: to be
achieved by the following principal pi.-vvisions:
1. BKK Corporation (hereinafter tJBKK"' ) will g._U1I!Sl\te€' the. City, for
the full t:e%m of the p.iuposed contract (as discussed later). a waste
capacity (Le.. space reservation) at the Class I landfill CMled and
operated by the ~ in the City of West Covina. ute expectancy
of the Bl<K landfill is projected to be :in excess of 40 yPm"e.
2. B1<K will significantly DDdemize and inprove (wit:lx:Jut c.apit'A1 ex-
pense to the City) the existing transfer facility, as described
later; and will serve as the operator of the transfer station. in-
cluding the function of waste transport to the En{ landfill in new
transfer trucks to be p~ovided by the carpany.
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Tetl!I:l and Conditions of BlO{ Proposal:
The prillH!j tenI13 and conditions of the BKK waste niRPOsal proposal are
presented, in Stiiifiiry fonn, in the following paragraphs. These. as well
as any other contract t~ and conditials jlw:1ged necessary or pertinent
by the City. will be presented and/or Hi-,-~-,lified in a specific fomat at
the City's cH rection.
1. Contract Tenn -
BKK proposes a cOntract period of ten (10) years, begiming Jar1UR'\"'f 1 t
1979, with a renewal option of ten addittonal years. Such term is
considered -essenriRl to providing reasonable periods for ~rtization
of capital investIrents asSOdSlted with physit"Al facility ~ts
and associated loo-c:1tTlg/trucking equiynpn.t.
2. EDploynent of City Personnel -
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Operation of the transfer station. including the associated trans-
port-to-landfill operations. will be perfonned by an existing operating
division of BKK. knc.1wn as Faloon Disposal Service. This division
operates the ccupany' s l~"'ge (800 t:ms per day) transfer station in
t-.7ilInington, which presently services the major portion of the City of
long Beach's waste di..5pC)sal needs. Falcon operating persUili&el (truck
Jr.-i. vers t loader operators, etc.) are all :rr....,~S of the T~mnRters
Union. Local 396.
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BKK Co~ration p~vposes to hire and oontim1e wq.)loynatt, through
its Falcon division. of all cp);:!l_ified City persamel currently en-
gaged in Santa }Dnica' s transfer station operations W10 are interested
in such ~;~)lcyrrent. It lr.ml1d be necessary, of course, that any such
City ~loyee ~ a neWer of IDeal 396 upon joining the Falcon
operating group.
3. Facility }bdemization -
~ proposes to initially contirn:1e the present node of transfer
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operation with the existing facility. with the intention to begin
construction of a new enclosed facility on the SBIIE site (as s~
on the set of efI-vT1eerlng drawings which have been provided separately)
as soon as requisite Comty and State solid waste facility permits
can be obtained.
8. Financing of the costs associated with the construction of the
new' facility and dEnnlition/~vva1 of existing !JLovisions will
be arranged for by BI<K, with no rli'1*eCt ~Rt'ital expense to the
City except for landse!Ting lmt:erf::a1 S costs (see p~ilph
3.e below). _ _
b. In order to reduce the per ton cost innact of the facility :1m-
~t (total cost estimated to be $600,000), a 20-year
(;j>'.-'ii.:ization scheAt_'le shall be est"J'lhlished. BKK will make regu-
lar w:n.i.th1y payments against the l'!11'i~AJ debt for the full tenn
of its contract with the City.
Should the City choose. for arrJ reason provided within the con-
tract. to discontirn:Je BKK's services srort of 20 years, the City
will as81~ full responsibility for servicing any rs::m::aiTting debt
associated with the fixed facility 1lDdem:f.zation. Outstanding
principal debt is shLMl, by r~, :in Table 1 for an initiAl
$600,000 facility inpfoVBIBlt. Ar. the end of the 2D-yPR'I'" perlDd.
the City will ~ the ~t free and cl,p~.
c. BKK will prepare. and the City will support. applit"!lble facility
m.x1ification dpYLuval requests to the County of IDs Angeles and!
or the State Solid Waste ManagA"rlF'n.t Board pursuant to current
gove.1:l'tI,o=mtal regulations.
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d. BKK will provide B cooplete engineered set of construction draw-
ings and construction schedule estiIna.te to the City for J:.-eview
and i1pproval prior to cu..1~\o"'I'\Cing construction. The City will
exsq>t BKK from all City fees for building permits, sewer con-
nection permits I etc.) associated with the facility mxlemization.
e. l'.ateri~ls for landscaping along the Delaware Avarue side of the
new' facility will be provided by the City (fTUfil existing InIrsery
stock) at no cost to BlOC Value of such materf,qls to be {ji:u-vided
by the City is est:i~ted to be less than $10,000.
4. Purchase and Replacarent of Existing City Equi~t -
The City currently av.ns and operates the following equipDB'lt in con-
junction with the transfer station operations:
PriP:m-y !'-bbile Equipment -
Four (4) diesel ~red. 3-axle truck tractors
Three (3) 20-ton capacity C(;(;~actor semi-trailers
1W::> (2) bucket loaders
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Salvage Vehicles -
cne (1) 20-cubic yard carpactor t:ruck
n.u (2) 10-cubic yard drop-off bodies
Fixed Equi:~xnent -
Truck weighing st"~ 1 es
Stationary packer treehanism
a. Under the proposed contract~ m<K will purchase fLUll the City--
at negoti~t~ "fair nm'ket values"--all of the t'prim:iry nnbile
equiJDBltrr listed above. Market value of such equi~t is cur-
rently estimA_ted to be $60,000 - $85,000. Pa:ynEl'lt for such
equipna::nt will be en a deferred basis (Le.. paid out as eqn~l
m:mthly pa~ts) over a period of tine to be agreed upon.
lmthly PaynBlts to the City will be applied as credits to the
W)[lthly billings to the City for disposal services ren,;~ed.
Replac:M)~!1t of the prltmry nnbile equi~t. to be solely at
HKK' s option~ shall be at no capital expense to the City; and all
new equiprent purchased shall be the property of RKK.. Cost of
the new prinmy DDbile equi~t to be provi~ by BKK is esti...
DBted to range froo1 $450,000 (with four transfer trucks) to
$625,000 (with six transfer rigs).
Should the City elect at the end of the basic contract period not
to renew the contract with BKK, or should the City choose for
any other reasgn provided. un,;~r the contract to tenninate BKK' 8
services, the City will have the option to purchase (or have
purchased) any or all equiflIEIlt then exclusive! y used by BKK for
the transfer station operation. Such equif'lTA't purchase by the
City ~d be based on negotiated "fair 11lArket values" then pre-
vailing. and 00. a cash basis.
b. lna.sn11ch as BKK proposes to imrer1i~tely replace the existing
"salvage vehiclesu with other equipralt !1DW' ~ by the Cl.uJlany,
the Cityt s existing salvage-related equipIBlt listed above will
be returned to the City for ili ~siticn. Should the City desire
to sell such, hc.Mevert BKK will assist in a~~i:isin.g and/or
locating purchaser(s) for g.,;f,,-,o;.. Value of this equi..~~nt is
presently estitTll'lted to be $10,000 - $15,000.
The "fixed equipnelt" nanEd above is either of no value to or only
of te!~porary utility to BKK t s planned station operations; and rray
have no marketable or resale value. According! y, lI:K will not pur-
chase either the truck s(,-81~ (presently inactive) or the stationary
packer unit TNhich will contirrue to be used only until coopletion
of planned station IJDdernization. Both the scale and packer
TIECharasre will be rt:2TDVed thereafter. PJ<K will attBtlf't, in behalf
of the City, to locate a purchaser for either of the fixed equip-
IJEI'lt items. In absence of such outside sale or other disposition
elected by the City, BKK will dispose of the J'laterials involved
at no charge to the City.
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5. Usage of the Transfer Station -
Use of the transfer station for disposal of refuse is currently limi-
ted to the City's fleet of refuse collection vehicles. furing the
initial phase of operation (Le., prior to CuU.pletion of m<K's pkul1:ed
facility JIDdemization), it is likely that the I'lu.l-"..' operating ~~-
city of the present station configuration (and associated transfer
vehicles) will necessitate the continued limiting use of the station
to nunicipal refuse trucks only. After the station rerxwation is
Cu"ltJleted (expected to be in the third quarter of 1979), BKK PLUl^'seS
and the City will authorize transfer station usage as follows:
a. PriImry Use - '1he principal and priority servi~~ of the transfer
station will continue to be for the waste disposal usage by the
City's collection trucks. No other deliveries shall be given
priority over City waste disposal needs, and waste ni 9X>sal charges
to "outsidetl users will never be at rates 1a..Jer than those chtu:~ed
to the City.
b. Secondary Use - The secondary service priority of the i:L"iU-lSfer
station will be for usage by private refuse collectors servicing
businesses and other industrial or institutional waste generators
located within the City.
c. Tertiary Use - To the extent that operating capacity rPI11A-{TlS,
transfer station usage will be permitted for mmicipal and private
collectors ogerating outside of the City.
BKK will limit the totAl "secondary" and "tertfRry" usage to fifty
(50) vehicle deliVciies per day--representing an average of about
5 refuse truck deliveries per hour. ActlJ~ 1 such use dtmmd will
be rliT'ectly related to a:vaj'~hility of the Mission Canyon landfill.
d. Other Use - BKK proposes to allow use of the transfer station, en
Saturdays and Sundays only, for waste deliveries by Santa Mmica
residents who wish to dispose of materi ~ 1 ~ fran house/ garage/yard
cleanup. 'Ibis service accc:tlDdation for locAl residents will be
instituted on a "tri ;Ill' basis, and if no reasonable usage thereof
is realized, Sunday operations will be discontinued. If resident
d~ ~ants continued Sund::ly operations. waste materials will
sinply be received and stored/loaded on those days, but no transfer
vehicles will nvYe to the landfill until the 1-bnday rrmn:ing following.
6. Station Operating Hours -
Current nomal hours of operation are 7:00 a.m. to 3:00 p.m., ~
through Saturday. In order to m:i..r!iml ze overnight waste storage and
to acca:rm::>date the abov-e. described additional users of the transfer
station, BKK proposes to operate the facility on the following nor-
rral (non-enErgency) schec1JJl e :
Open to Delivery of Waste
l'bnday - Saturday
Sunday (private vehicles)
8:00 a.m. - 6:00 p.m.
10:00 a.m. - 3.00 p.m.
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Waste _Processing (Transfer Truck_ lDad.ing)
M:loday - Saturday
Transfer Truck Departure/Retum
Mnday - Saturday
7:00 a.m. - 7:00 p.m.
4;00 a.m. - 5:00 a.m.
7:00 a.m. - 7:00 p.m.
7. Stat;nn Cperation in Event of Labor Strike -
As pointed out ~"'lier, BlQ('s Falccn Disposal Service division will
operate the transfer station. All Falcon operating persoonel are
lIEIlbers of the T~ters Url.on (lDrj:ll No. 396). Bl<K. has recently
~leted ne.goti Atlng a new five-yPRT 1S100r contract with the
Temnc:ters lbion, effective July 1, 1978. As with all past .BRK
unicn labor contracts, the new A~t cont.aiJlS a "no stdke"
provision for the full t€'1Ti1 of the A~t.
BKK has never, in the ~'s history, had a strike (sanctioned
or otherwise) called against it by the T~'-~ters Won. Ccnpany
relations with all 1.1l1ion-represented enployees is excellent, and no
change in such relationship is eJq>eCted. Accordingly. BKK is confi-
dent in the belief that no labor strike will occur chn1ng the course
of the contract with the City.
In the irrprobab1e event that a union 1 Ahor ~ stoppage should occur,
BKK will provide non-interrupted waste disposal service for the City,
as follows:
a. Waste deliveries to the transfer station ~d i.mIerliAte1y be
limited to only the City's collection vehicles. )..11 seccndary
and other users, as ~fined PArlier, lr.UUld be denied station
usage tmtil the union labor llmk stoppage 'WaS corrected.
b. BKK lMnagenent and supervisory personnel (non-union) ~d pro-
vide for conti.InDus station operatial until su.ike settlellErlt.
8. Disposal Rates -
a. Initial P.ate to City
BKK proposes, for the period fran January 1 through JuDe 30, 1979,
to accept (at the transfer station) and pi:uvide for disposal (at
the BKK West Covi.na landfill or any other landfill selected by
BKK) all refuse delivered by City vehicles at a disposal rate,
exclusive of govcilwlt:!t1t surcharges (see paragraph 8. d), of:
$7.35 per ten
Until new truck weighrent scales are provided by BKK as part of
the proposed station renovation, the above rate will be ('.ah"111,!:1ted
upon actual recorded weig..i-J.ts of transfer truck deliveries to the
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landfill. ~~reafter. City trucks will be individually ~ighed
(gross and net) upon entry to the transfer station.
b. Disposal Rate to Other Users
After station tIX)derni 7~tion is e<:cplete (inch1~;ng truck sC'~l e
installation) and transfer station usage by other non-city
vehicles is initiated, the disposal rate for such shall be:
$8.00 per ton (until June 30, 1979)
Therp.::Ifter, the disposal rate for non-city vehicles is exnected
to be about 10% higher than the rate charged to the City.
c. Rates AdjustnPnt
The contract shall provide for periodic review of pertinent cost
e1arents and shall allO'iN for a once-per-year adjustnEnt (uowards
or downwards, as appropriate), to becare effective on July 1
of ~;:I('h Y~;:Ir of the contract tenn.
hry rate escalation (or de-es('~l ation) shall be predicated upon
a 1II.rt:n.ql1y ~ereed upon "adjUStne:lt formJl;:!" vhich includes the
tIBjor cost elerents shor",n in Table 2 attached.
d. ~L.-llil_j-tt Surcharges or Legislative T~t
Recent and contenplated legislation will/may inpose certain sur-
charges upon solid waste disposal or may dictate or restrict the
location or form of ultiImte disposal of the waste. Therefore,
in addition to the foregoing Cfluua.l rate review and adjustm::rnt,
suppl~_t~l rate adjus~ts may be required (b_~ to legislative
actions (federal, state or county) beyond the control of either
the City or BKK. In the event that surcharges or a higher cost
fonnIlocation of diSIXJsa1 (other than 1a:ndfil1ing at BKK's West
Covina facility) are guva'uulo::1st-:;11y legislated--and BlQ{ and/or
the City CcnIlK)t obtain ~ti.on therefiun--the City will allow a
direct equivalent rate adjustIIEnt iTTITPI"H;:;tely upon the cost-
effective date of any such legislation.
Note: hi. ~le of an liiilUnent legislated surcharge is the S. 25
per ton fee to be i1TflOsedi effective Jarn1.<:l'!"y 1, 1979, un~ Section
66796.22 of the state ~i1-ri-,-....\t Code. It should be noted that
certain e]CMifJtions to such surcharge can be gJ:811ted by the State
Solid Waste M:magene1t Board, and BKK will, with the City's assistance,
seek such ~'~Jtion for the Cityfa transfer station.
9. Revenue Sharing with City -
lI<K proposes to share revenues derived fran ~ ffoutsideff som:ces
in connection with the transfer station operation, as follows:
a. Disposal ClI.iu:ges to Se~ry & TertiRTy Users -
m<K will pay to the City (via a billing credit) a share of the
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disposal char~es collected fr(l!1 the secOPd;1T"'j and tertiary users
of the transfer stationJ as previously defined, according to t..~
schech.1le below'
Year of Operation
IJ2.3
4.5
6.7.8
9.10
h. Materiflls Salvaging & Pecycling -
Fee to City
o
$.2S/ton
$.50/ton
$. 75/ton
To the extent that ~Tkets exist for recyclable secondary materi I'll s
and the associated econanics ret'AAin 1X>sitive in nature. BKK. will
institute salvaging/recovery operations. For alllIBterials re-
covered and sold, BKK will pay to the City (via a billing credit)
an :mnunt eq11.~ 1 to fifty (50) percent of the prevailing landfill
disposal per ton charge (for each ton of zmterial recovered and
thus diverted frcm 1andfilling) plus ten (10) percent of the net
revemJeS derived fran the recovered materials sale.
10. Business and Vehicle License Fees -
The City will exE!l:!J>t BKK fran paynEtt of srry and all business license
fees and/or vehicle license fees established by the City.
11. Rights of City to ~ate Transfer Station - ~.
In the event of any wui.~r:. stoppage whic..'I-J. c&ik10t be corrected by l!l<K,
as described in paragraph 7.b, or otherwise, the City (inchrltng repre-
sentatives nl?s.ignated by the City) will have the ;TTI,~-1i Rte right to
enter and operate the transfer station and associated equitxrent until
Bl<K can resuIE IlQT'ITlR 1_ operations. Any and all expenses incurred by
the City in CUiuleCtion with such operational intervention shall be
~_~ted fran fees or UDI1ies due to BKK.
12. Insurance-
Bla{ will provide and pay for a nuo_1.<llly ~ereed program of general
liability, property damage and wurkers' ~ation insurance.
In view' of the City's right to operate the transfer station, as described
in parae;raph 11 above, due to BKK M:lrk stoppage for any ~~.c:on ~tso-
ever. transfer station performance is assured.. Accordingly. performance
bonding is mt p~'Ovided. Should the City reqnire such bondingJ Bl<K
will provide san'e and be Cui~ted for such by the City in ~ilr1;tion
to and above the disposal charges specified in paragraph 8. l]nttP,..
present rate structures, the estiIrated cost of such bonding would be
approximately 1.5 percent of the dol1~ SIIDU[lt bonded.
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TABlE 1
FACTT.T'lY MIIERNIZATla:l' UtJ5J: SERVICE
t-bte: Figures below are based upon:
(a) Init; ~l cost/loan of $600,000
(b) 10% loan interest rate
(c) 20-year ;mnrtizatioo with 240 equAl mnthly paynB'lts of
$5,790 (inclt.rtiir,g principal and interest)
END OF UNPAID CITY EQUiTY
YEAR PRINCIPAL ~ PER 'l'(E *
1 $589,800 $10,200 $.16
2 579,000 10,800 .17
3 567,000 12,000 _19
4 553,800 13 , 200 .21
5 538 , 800 15 , 000 .24
6 522,600 16,200 .26
7 504.600 18,000 .29
8 484.200 20,400 .32
9 462,600 21,600 .34
10 438,000 24,600 .39
11 411,000 27,000 .43
U 381.600 29,400 .47
13 348,600 33,000 .52
14 312,600 36,000 .57
15 272,400 40,200 .64
16 228,000 44,400 .70
17 179,400 48 , 600 .77
18 125,400 54,000 .86
19 66,000 59.400 .94
20 0 66,000 1.05
$600,000
* Equity l2'8med per ton of re.....~e asSU'!:eS 63,000 tons per ,?;:rr" disposed
by City.
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TABLE 2
DISPOSAL RATE AnJUSn1ENT P~llil<S
Cost El...,-....nt
(1) Fixed facility
(20-y-" mrnrti '7Ation)
(2) Labor
(3) MJbile EquipnPn.t
(S-yP.R" ;:mnrr-i '7.1ltion)
(4) Diesel fuel
(5) Tires
~
(6) Equitmnt and facility
maintenance
(7) I.Rn.dfil1 durping fee
(8) Insurance
(9) Overhead & Profit
P~r(;.ent of
InitiRl Rate
Basis of
Annn~l AdjUStnelt
No adjus1'1nPl1.t for 20 ~~t-~
Eliminate 't:herPflfter.
5.8
26.1
Te~ters Url.on labor contract
rates; plus charges in state
or federal "fringes," as
applicable.
16.2
Const.mEr price index (CPI)
for L.A. area--1/5 per Yf'RT.
6.2
$.50/gal1on base rate.
5.1
CPI
10.1
CPI
17.0
Base rate at BKK Landfill (West
Cavina), per ten, as follows:
1/1/79 - 6/30/79
7/1/79 - 6/30/80
7/1/80 - 6/30/81
$1. 25
l.S0(n1us 8%
City tax)
1. 75 (plus 10%
City tax)
Ther€".R fter, m~ndIIlJlIl to be
$1.00 per ton (or lIDre) less than
prevailing rate at lACSD Puente
P.i1ls landfill.
3.8
~any prf:rw.lI11
9.7
Constant percent of total
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