City scrutinizes long-term trash contract
The police services agreement with Brea isn’t the only municipal contract that’s under scrutiny by City Council: a firm was hired last month to perform a three-year audit on the company that’s hauled away Yorba Linda trash for more than 50 years.
Council gave notice to Yorba Linda Disposal in 2010 that the city was “not renewing the automatic time extension portion” of a 20-year contract approved in 1995. The pact was automatically extended one year each July 1, unless one of the parties decided otherwise.
The automatic extension clause, which kept the contract in force for 20 years at a time, is the reason the agreement is termed “evergreen,” so the city’s 2010 notice puts a potential end date in 2029, since one more year was added annually from 1996 through 2009.
The audit approved Dec. 20 is labeled a “financial and performance audit” and will cover three fiscal years ending June 30, 2010, at a $37,455 cost to the city by Willdan Financial Services of Temecula, which won the contract over three other proposals.
Findings are expected to be presented to council in May and will include reviews of the accuracy of the trash company’s biannual rate adjustment requests, customer billing and city invoicing, revenue sharing from recycling and calculation of the city’s franchise fee.
Most residential customers, with one black, green and brown container, pay $58.68 each three months, and the city takes a five percent franchise fee from the firm’s total income.
Revenue from refuse collection fees is expected to be $4.78 million for the 2011-12 fiscal year, according to figures in the city’s operating budget, with another $450,000 estimated income from recycling and $100,000 from interest and billing fees.
Interestingly, a $427,238 fund balance at the end of the 2009-10 fiscal year, representing revenue remaining after all costs were paid, is expected to dwindle to zero for the current fiscal year, again according to the city budget.
At the same time council notified the refuse company the city was dropping the automatic time extension provision, members also voted to “initiate negotiations to the agreement in 2015 to include new enhancements….”
Council is looking for no-cost trash service at city-owned buildings and donations to help fund events, such as Fiesta Days and the July 4 program, a 2010 city report stated, adding a company official indicated “willingness…to potentially add various enhancements….”
Mayor Mark Schwing, who cast lone council votes against residential and commercial fee hikes in May, told me, “My interest is that other cities getting current bids on similar contracts are getting rates considerably less than Yorba Linda residents are now paying.”
Yorba Linda Disposal, founded in 1959, was hired officially when the city incorporated in 1967. The local hauler was bought by Taormina Industries in 1988 and is now owned by Republic Services, which operates 348 collection companies in 40 states.
Yorba Linda Disposal also serves 1,103 Country Club and Fairlynn county island homes. The city assumed control of pickup from the county in 2009, collecting the franchise fees and cutting monthly rates 53 cents.
Council gave notice to Yorba Linda Disposal in 2010 that the city was “not renewing the automatic time extension portion” of a 20-year contract approved in 1995. The pact was automatically extended one year each July 1, unless one of the parties decided otherwise.
The automatic extension clause, which kept the contract in force for 20 years at a time, is the reason the agreement is termed “evergreen,” so the city’s 2010 notice puts a potential end date in 2029, since one more year was added annually from 1996 through 2009.
The audit approved Dec. 20 is labeled a “financial and performance audit” and will cover three fiscal years ending June 30, 2010, at a $37,455 cost to the city by Willdan Financial Services of Temecula, which won the contract over three other proposals.
Findings are expected to be presented to council in May and will include reviews of the accuracy of the trash company’s biannual rate adjustment requests, customer billing and city invoicing, revenue sharing from recycling and calculation of the city’s franchise fee.
Most residential customers, with one black, green and brown container, pay $58.68 each three months, and the city takes a five percent franchise fee from the firm’s total income.
Revenue from refuse collection fees is expected to be $4.78 million for the 2011-12 fiscal year, according to figures in the city’s operating budget, with another $450,000 estimated income from recycling and $100,000 from interest and billing fees.
Interestingly, a $427,238 fund balance at the end of the 2009-10 fiscal year, representing revenue remaining after all costs were paid, is expected to dwindle to zero for the current fiscal year, again according to the city budget.
At the same time council notified the refuse company the city was dropping the automatic time extension provision, members also voted to “initiate negotiations to the agreement in 2015 to include new enhancements….”
Council is looking for no-cost trash service at city-owned buildings and donations to help fund events, such as Fiesta Days and the July 4 program, a 2010 city report stated, adding a company official indicated “willingness…to potentially add various enhancements….”
Mayor Mark Schwing, who cast lone council votes against residential and commercial fee hikes in May, told me, “My interest is that other cities getting current bids on similar contracts are getting rates considerably less than Yorba Linda residents are now paying.”
Yorba Linda Disposal, founded in 1959, was hired officially when the city incorporated in 1967. The local hauler was bought by Taormina Industries in 1988 and is now owned by Republic Services, which operates 348 collection companies in 40 states.
Yorba Linda Disposal also serves 1,103 Country Club and Fairlynn county island homes. The city assumed control of pickup from the county in 2009, collecting the franchise fees and cutting monthly rates 53 cents.
posted by Jim Drummond at 12:00 AM
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