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Waste Mgmt/Franchise 91-.Ste Management of the Desert 41-575 Eclectic Street P.O. Box 3876 Palm Desert, California 92261-3876 619/324-1741 �Q A Waste Management Company NV FINAL EXCLUSIVE CONTRACT TO PERFORM REFUSE COLLECTION SERVICES CITY OF LA QUINTA AND WASTE MANAGEMENT OF THE DESERT 0 a division of Palm Des t �,�s�, .sa, Sa. r� ,� CITY OF LA QUINTA REFUSE COLLECTION AND DISPOSAL FRANCHISE AGREEMENT THIS AGREEMENT is entered into by the City of La Quinta, California, a municipal corporation (hereinafter referred to as the 11City") and Waste Management of the Desert, Inc. (hereinafter referred to as the ('Franchises") pursuant to Section 4250 of the California Health and Safety Code and Chapter 6 of the La Quinta Municipal Code. ARTICLE I The term of the Agreement shall be for a period commencing on July 1, 1991 and ending on June 30, 1996. Both parties shall work in good faith to extend this Franchise Agreement for an additional five (5) years option period. In the event that the city determines it shall operate a municipal garbage and refuse disposal system, as provided in Section 20.02 sub 3.b, this agreement may be canceled by the City in accordance with said section. This agreement may be canceled by the city for good cause determined after public hearing and notice to the Franchisee if the Franchisee fails to comply with the terms and conditions hereof. ARTICLE II SCOPE OF WORE AND FRANCHISE AGREEMENT SECTION 2.01 - SCOPE OF WORE. This Agreement gives Franchisee exclusive rights as set forth in Article XIII. The work to be done consists of collecting and disposing of residential and commercial refuse within the corporate limits of the City. It further includes the furnishing of all labor, methods or processes, tools, equipment and transportation necessary to meet the requirements of the Agreement. All collections and disposal contemplated hereunder shall be done and performed promptly in a good, thorough, workmanlike and efficient manner to the reasonable satisfaction of the Administrative Authority, designated by the City. SECTION 2.02 - RECYCLING. The Franchisee agrees to provide recycling services to the City as specified in the Recycling Agreement (Exhibit A). 0 ARTICLE III EQUIPMENT AND PERSONAL SECTION 3.01 REFUSE COLLECTION VEHICLES. The Franchisee agrees that all equipment shall comply with each and all of the applicable and pertinent provisions of the laws of the State of California and all ordinances, rules and regulations of the City and of the City Council of the City having reference to such matters, features or services. All equipment incidental to the performance of this service and used with the City shall be approved by the Administrative Authority and shall at all times be subject to inspection by the Administrative Authority to assure their maintenance in a satisfactory and proper mechanical condition and that they are neat an clean in appearance. Trucks shall be loaded and operated in such a manner that no refuse material shall be spilled in streets or alleys. should any refuse be spilled on any street, alley or elsewhere, it shall immediately be cleaned up. A broom and shovel shall be carried on each truck at all times for this purpose. If not cleaned up by the Franchisee, the City may clean up same and collect the cost thereof from the Franchisee. The Franchisee's name and telephone number shall be shown on each side of each truck in letters three (3) inches high. All vehicles and equipment used in the collection of refuse, if kept within the boundaries of the City, shall at all times when not in use in the collection of refuse be kept on private property of appropriate zone and not on streets or other public ways. Bodies of trucks shall be metal and shall be so constructed that no refuse material shall be spilled from said trucks on the streets or alleys. At least once weekly both tank and running gear of vehicles used for the collection of refuse shall be thoroughly cleaned by washing or other suitable means. In addition, the Franchisee shall provide two-way radio communication between the route supervisor and all vehicles. SECTION 3.02 - CONTAINERs. All containers shall be supplied, cleaned and maintained by the Franchisee. The type, size and number of containers shall be determined as best fits the needs of the respective establishments and approved by Franchisee. E Bins shall be metal and leakproof. In areas where use is near residential houses or in a residential zone, the bins will be constructed with plastic -type lids. Bins shall be painted and repainted as required to maintain the attractive appearance of the community. It shall be the duty of the Franchisee to clean and maintain containers and bins in a basic sanitary manner taking into consideration reasonable expected wear and tear. This requirement does not eliminate the responsibility of the Franchisee to clean with greater frequency if the Administrative Authority determines that such cleaning is required to abate a health nuisance. Containers shall include two (2), three (3) and four (4) yard bins with lids; and twenty (20), thirty (30) and forty (40) cubic yard roll -off truck bodies. Other types of containers which appear to have value in the storage and collection of refuse may be proposed by the Franchisee to the Administrative Authority during the course of this Agreement. If approved, they may be substituted for the appropriate container. The Franchisee shall, upon approval of the Administrative Authority, be permitted to try any new refuse collection system that might be developed. SECTION 3.03 - EMPLOYEES. All employees of the Franchisee, while collecting refuse, shall be required to wear a uniform type of clothing approved by the Administrative Authority. Said uniform shall look freshly cleaned and pressed. Each employee shall at all times carry a valid operatores license for the type of vehicle they are driving. ARTICLE IV SUPERVISION SECTION 4.01 - ADMINISTRATIVE AUTHORITY. Performance of each of the provisions of this Agreement shall be under the supervision of the Administrative Authority to see that the collection and disposal of refuse is carried out by the Franchisee as contemplated in this Agreement, the laws of the State of California, the County of Riverside, ordinances of the City, and -- any other regulatory body or agency having applicable jurisdiction. The Franchisee shall faithfully and regularly collect and remove from the City refuse in accordance with this Agreement. 3 SECTION 4.02 - QUAMITY OF REFUSE. In the event of a dispute between the Franchisee and a business or other non-residential location as to the quantity of refuse that such location has placed for collection, the Administration Authority shall investigate and make a determination that shall be binding on the Franchisee. SECTION 4.03 - CON,PLAXNTB. The Franchisee shall maintain an office at some fixed place and shall maintain a telephone thereat, listed in the telephone directory in its name, and shall at all times during the hours between 8:00 a.m. and 5:00 p.m. of each day, excepting Saturday, Sunday and holidays, have some person at said office with whom the public, the Administrative Authority or other responsible City officials or employees may communicate, discuss and refer any complaint arising in connection with such collection and disposal service. The telephone for the Franchisee shall be on a toll -free - exchange to all residents of the City. Complaints shall be investigated within twenty-four (24) hours and appropriate action taken. A form, approved by the Administrative Authority, shall be kept indicating the day and hour complaints were received, as well as resolution of complaints. Such records shall be available for inspection by the Administrative Authority during normal business hours. ARTICLE V INSURANCE SECTION 5.01 - GENERAL REQUIREMENTS. Franchisee, at Franchiseels sole cost and expense and for the full term of this contract or any renewal or amendment thereof and for the licenses and privileges herein above granted to Franchisee, shall obtain and maintain all of the following minimum insurance requirements to cover Franchiseels acts or omissions relating to its performance pursuant to the Franchise Agreement. Satisfactory evidence of such insurance by an acceptable company shall be submitted to the City at least five (5) days prior to the execution of this contract. The City shall be sole judge of what evidence is satisfactory and which company is acceptable. (1) A Comprehensive General Liability policy with a minimum _ limit of not less than five million dollars ($5,000,000) combined single limit for bodily injury and property damage. (2) A Comprehensive Business Auto policy with a minimum limit of not less than five million dollars ($5,000,000) combined single limit for bodily injury and property damage, providing coverage for 4 least any and all leased, owned, hired or non in any of Franchiseels activities pursuant to _ and all mobile equipment which is not Comprehensive Business Auto policy shall provided for under the Comprehensive General -owned vehicles used this contract. Any covered under this have said coverage Liability policy. (3) The Franchisee shall obtain Workman's Compensation Insurance in an amount as will fully comply with the lave of the State of California and which shall protect both the Franchisee and the City for any loss, claim or damage arising from any injuries or occupational diseases happening to any workman employed by the Franchisee in the course of carrying out this contract. SECTION 5.02 - REQUIRED ENDORSEMENTS. All of the following endorsements are required to be made a part of the insurance policies required by Section 5.01 as stipulated below: (1) N'The City of La Quinta, its employees, officers, agents and contractors are hereby added as additional insured.' (2) "This policy shall be considered primary insurance as respects any other valid and collectible insurance the City of La Quinta may possess including any self -insured retention the city may have, and any other insurance the City does possess shall be considered excess insurance only.le (3) "This insurance shall act for each insured, and additional insured, as though a separate policy had been written for each. This, however, will not act to increase the limit of liability of the insuring ccmpany.el (4) "Sixty (60) day s prior written notice shall be given to the City of La Quinta in the event of cancellation, reduction in - coverage, or non -renewal of this policy for whatever reason. Such notice shall be sent to: La Quinta City Clerk and purchasing agent. (5) Endorsement #4 above (sixty days notice) is the only endorsement required to be made a part of the Workers, Compensation and Employees' Liability policy. SECTION 5.03 - DELIVERY OF PROOF OF COVERAGE. Copies of all the endorsements required by Section 5.02 shall be attached to the Certificate of Insurance which shall be provided by Franchiseels insurance company as evidence of the stipulated coverages. This proof of coverage shall be mailed or delivered to: 5 City Clerk City of La Quinta 78-105 Calls Estado La Quintal CA 92253 ARTICLE VI PEBOND The Franchisee shall provide the City with a performance bond or letter of credit at least five (5) days prior to the execution of this contract, issued by a company satisfactory to the City, in the amount of $1,000,000. Performance bond shall indemnify the City against any losses or expenses sustained in the event of the - default or failure of the Franchisee to perform in accordance with the terms of this Agreement. The form of the bond or letter of credit shall be approved by the City Attorney and shall include a provision for the surety company or financial institution to send notice to the City of any action taken concerning the bond or letter of credit. ARTICLE VII REPORTS The Franchisee shall annually provide the City with a certified statement of its gross receipts by category of service, within ninety (90) days after the close of Franchiseels fiscal year, from all revenues attributed to all operations within the City covered by this Agreement. Such statement shall be attested to by a certified public accountant or a licensed public accountant. The Franchisee shall also: 1. Keep a separate accounting of dump surcharge revenues collected from within the City and shall from overall operations, separate surcharge expenses from other expenses. 2. Permit the City to inspect cash receipt records of Franchisee at any reasonable time to insure performance of the above contract provisions. 3. Maintain statistical accounting records of complaints. 4. Twice each year, during the months of July and January, otherwise upon request of the Administrative Authority, submit a report of number of customers serviced within the City. Said report shall be separated showing both residential and commercial accounts. ARTICLE vIII REPORTS Except as provided in Section 20.01, Paragraph 17, this _ Agreement shall not be assigned or transferred without the consent of the City Council of the City, nor shall any subcontractor be recognized or dealt with by the City or any of the persons chargeable with the enforcement of this Agreement. In the event — that the City Council authorizes a subcontractor to perform any of the services herein, the Franchisee shall at all times be personally responsible for the performance of the conditions of this Agreement. ARTICLE IY DEFAULTS In the event Franchisee defaults in the performance of any of the material covenants or agreements to be kept, done or performed by it under the terms of this Agreement, City shall notify Franchisee of the nature of such default within ten (10) days following such notice, Franchisee shall: (a) Correct the default; or (b) In the case of a default not capable of being corrected within ten (10) days, Franchisee shall commence correcting the default within ten (10) days of Cityls notification thereof, and thereafter correct the default with diligence. If Franchisee fails to correct the default pursuant to the above options, the City without further notice, shall have any of the following rights and remedies: — (a) The right to declare that all rights and licenses granted Franchisee hereunder are terminated, and City shall have the election to terminate the Agreement; (b) The right to rent or lease equipment from Franchisee for the purpose of collecting and transporting refuse which Franchisee is obligated to collect and transport pursuant to this Agreement, for a period not to exceed eighteen (18) months; in the case of equipment not owned by 7 Franchisee, Franchisee shall assign to the City, to the extent Franchisee is permitted to do so under the instruments pursuant to which Franchisee possesses such equipment, the right to possess the equipment. If city exercises its rights under this clause (b), city shall pay to Franchisee the reasonable rental value of the -- equipment so taken for the period of the City's possession thereof; (c) The right to license others to perform the services otherwise to be performed by Franchisee hereunder, or to perform such services itself; and (d) The right to obtain injunctive relief as both parties recognize that in the event of a default of this agreement by Franchisee, City will suffer irreparable injury and incalculable damages sufficient to support injunctive relief to both enforce the provisions of this Agreement and enjoin the breach thereof. ARTICLE Z INDEMNITY Franchisee agrees that is shall indemnify and hold harmless city, its officers and employees, from and against any and all loss, liability, penalties, claims demands, actions or suits, of any and every kind and description, arising or resulting from, or in any way connected with: (1) Any operations of Franchisee, its agents, employees and/or Subcontractors in exercising any license or privilege granted to it by this Agreement and/or by any ordinance of City. (2) The failure of Franchisee, its agents, employees and/or Subcontractors to comply in all respects with the provisions and requirements of this Agreement. (3) The failure of Franchisee, its agents, employees and/or Subcontractors to comply in all respects with the provisions and requirements of all applicable ordinances of City, all other applicable laws and regulations, and/or all applicable permits and licenses, provided that if the City alone be sued for such injury or damage, immediate notice in writing shall be given to the Franchisee to appear and defend such action. Franchisee shall, upon demand of City, at Franchisee's sole cost and expense, defend and provide attorneys to be selected by City, and upon the advise and consent of the Franchisee which shall not be unreasonably withheld, to defend City, its officers and/or employees, against any and all claims, actions or suits in any legal proceedings 8 whether judicial, quasi-judicial, administrative or legislative in nature brought against City, its officers and/or employees, arising _ or resulting from those situations described in (1), (2) or (3) above. ARTICLE ZI WITH ALL LAWS The Franchisee agrees to conform to and abide by all of the rules, regulations and ordinances of the City, and all laws of the State of California or the Federal government, governing the collection, hauling and disposal of refuse. -- The Franchise agrees to conform to and abide by all the valid rules, regulations and ordinances of any government entity through which refuse may be hauled or in which refuse may be disposed of governing the collection, hauling and disposal of refuse. ARTICLE ZII The Franchisee shall pay all Federal, State and local taxes, including sales taxes, social security taxes, etc., which may be chargeable against the labor, material equipment or other items necessary in the performance of this contract. ARTICLE ZIII EXCLUSIVE RIGHTS The Franchisee shall have the exclusive right and privilege within the City, to collect and dispose of refuse. Refuse is defined herein and in Chapter 6 of the City of La Quinta Municipal Code. Except as otherwise herein provided, the Franchisee shall not be required to provide service to anyone not using containers furnished by the Franchisee. All refuse collected by the Franchisee shall become the Franchiseels property from and after the time of such collection. Franchisee may deliver the refuse to _ any approved landfill or other disposal site. The Franchisee shall not be required to collect or dispose of any hazardous waste materials except as allowed by law. E In the event territory is annexed to the City of La Quinta and if for the three years immediately prior to such annexation, refuse collection services were provided by a refuse collector authorized to perform such services by the local agency having jurisdiction over such territory prior to annexation, then such authorized refuse collector may continue to provide refuse collections service in the territory in accordance with California Public Resources Code Sections 49500, et sect. ARTICLE ZIV RATES The Franchisee shall not charge or demand rates for such refuse collection service in excess of those set forth in the current approved rate schedule (Exhibit B). A copy of said current rate schedule shall be on file at City Hall and available for inspection by the general public. Any modification of such rates may be initiated by the Franchisee or the City and shall be finally approved by the City before being charged. The Franchisee shall inform the Administrative Authority, at its request, of the rates charged a particular individual or business. If the service is not provided a scheduled rate, Franchisee and customer may negotiate a rate after notice and upon approval of City. ARTICLE %V REVIEW OF RATES 1. Franchisee may request refuse rate increases once a year during the month of March, to reflect ordinary changes in the cost of doing business, as measured by fluctuations of the Consumer Price Index (CPI), published by the U.S. Department of Labor, Bureau of Labor Statistics, for the Los Angeles -Anaheim -Riverside area, subject to City Council approval. The fees or compensation may be increased in a percentage amount equal to fifty (50) percent of the net percentage change in said CPI, computed as the difference between the index from February of the previous year to February of the current year. 2. In lieu of a rate increase request under Paragraph 1 (above), Franchisee may petition the City for a rate adjustment on the basis of unusual changes or extraordinary increase in direct costs of operation. In such event, the Franchisee shall provide a form in direct accordance with Paragraph 3, which may be completely tested and audited by the Cityls accounting personnel, or if the City chooses, by an independent Certified Public Accountant or licensed public accountant. Any such certification 10 shall be at the expense of the Franchisee. _ 3. The Franchisee shall provide the City, in the event the Franchisee petitions the City for a rate adjustment, on the basis of unusual changes or extraordinary increases or costs of doing business, with a copy of its certified annual financial statements prepared by a Certified Public Accountant or a licensed public accountant, which shall have been prepared in compliance with Rule 58 of the IlRules and Regulations of the State Board of Accountancy,11 as established by the California Administrative Code, Title 16, Chapter I. Such Certified Public Accountant or licensed public accountant shall be entirely independent of the Franchisee, and shall have no financial interest whatsoever in the business of the Franchisee. The Administrative Authority may specify the form and detail of the financial statements. -- 4. City shall render a written decision on the Franchiseels petition, either accepting, rejecting, modifying or deferring the same and reciting the basis of its decision. Any rate increases granted by the City Council under the provisions of this section shall be applicable beginning July 1 of that year. ARTICLE ZVI FRANCHISEE PAYMENTS TO CITY In consideration for an exclusive contract, Franchisee shall pay to the City eight (8) percent of all gross receipts, exclusive of dump fee surcharges, received under this contract. Payment will be made to the City by the fifteenth (15th) of every month for the preceding month's receipts. In the event of termination, the balance due for the billing period during which the termination occurs, shall be paid within thirty (30) days of the date termination. ARTICLE ZVII COLLECTION AT CITY FACILITIES SECTION 17.01 REGULAR DISPOSAL SERVICE. The Franchisee agrees to provide collection services at no charge for refuse containers on City property and at those locations designated by the Administrative Authority at which City - sponsored events are held. The collection shall be made at a frequency acceptable to the City. The following list of City facilities is intended to provide the Franchisee with a feeling for the scope of this provision, and 11 is not intended to limit the City from identifying other locations during the term of the contract. 1. City Hall 2. Park located on Avenue 52 3. Athletic Field on Avenue 50 (Truman School) 4. Maintenance Yard located near Avenue 52 As additional City facilities are developed, expanded services will be provided. SECTION 17.02 - BI-ANNUAL CITY CLEANUP. Twice each year, the City has a City-wide cleanup effort wherein the City allows residents (non-commercial) to put out anything to be collected with the refuse. The Franchisee shall, at no additional charge, provide collection services during such time, provided, however that the Franchisee shall not be required to collect large and heavy items such as building materials, soils, vehicles, washers, dryers, freezers and refrigerators. The Franchisee shall, however, at no additional charge, provide roll - off bodies located at the direction of the Administrative Authority, such as to provide for the removal of such items. The Franchisee shall collect these items at other times of the year, but is shall be permitted to collect an extra charge for those times, as approved by the Administrative Authority. ARTICLE ZVIII HOLIDAYS Beginning August 1, 1990, and for the balance of the term of this Agreement thereafter, if a collection day should fall on a holiday following a weekend (three-day weekend), the Franchisee shall provide an alternative collection day, either the day before or the day after the three-day weekend. ARTICLE ZIZ OBLIGATION OF CITY The obligations hereby assumed and agreed to be performed by the City shall include, but are not limited to the following: A. City shall cooperate in any manner reasonably required to permit the Franchisee to perform the terms of this contract. B. During the term of this contract, except in instances of breach of this contract or as provided in Article XIII hereof, the city will not permit any other person or firm to collect refuse originating on or from premises in the City as defined herein. 12 ARTICLE u GENE27►L PROVISIONS It is understood and agreed by following General Provisions shall parties, as applicable and necessary of this Franchisee Agreement. SECTION 20.01 - DEFINITIONS. the parties hereto that the apply to each party or both to assure the effectiveness 1. Solid Municipal Wastes. The term "Solid Municipal Wastes$@ as used herein, shall mean 81the usual and customary types of household and commercial garbage, trash and refuse, such as wastes from the preparation and cooking foods, waste food, waste paper cloth, containers, such as bottles, tin cans, carton and crates; materials such as wood, plastic, rubber, metal, glass, grass, tree and plant trimmings, and other refuse items customarily deposited by City residences, commercial and industrial establishments, homeowners, occupants, contractors, builders and visitors, in collection containers or areas for pickup and disposal by themselves or others.11 The following materials are excluded: a. Wastes, consisting primarily of earth and earth materials b. Liquid wastes c. Special wastes, such as chemicals, oils or materials of hazardous or explosive nature. 2. Trash. The term "trash'@ as used herein, shall mean 91tree stumps, roofing material, plaster, concrete or other substances that may accumulate as a result of repairs or construction to land or buildings, or as a result of initial clearing of lots, or as a result of building operations. 3. City Residences. Commercial and Industrial Establishments. The term "City$' as used herein and associated thereto, shall mean, I'Any and all inhabitants, human or otherwise, that are within the jurisdiction of the City and/or community services provided thereto during the term of this contract." 4. Residences. The term 11residencesil as used herein, shall mean, "Any structure or space provided for or used for the inhabitation or occupancy of people and/or their belongings on a permanent, temporary or transient basis, and shall also include recreational areas.11 S. Commercial Establishments. The term "Commercial Establishments" as used herein, shall mean, $'Any organization, 13 private or civic, of any number of persons or objects that provides goods or services to the City or its inhabitants.11 6. Industrial Establishments. The term "Commercial Establishmentse, as used herein, shall mean, IlAny organization, private or civic, of any number of persons or objects that manufactures, assembles, combines, grows, harvests, converts or refines any substance, liquid element, material or energy source of any type. 11 7. Bulky Items. The term "Bulky Items" as used herein, shall mean, IlObjects of furniture, household or industrial appliances, shipping crates and containers or other large bulky or heavy objects not normally discarded on a regular basis by City residences, commercial or industrial establishments. 8. Administrative Authority. The term "Administrative Authority" shall mean the City Manager and/or his representative. _ 9. Hazardous Waste Materials. The term "Hazardous Waste Materialsel shall mean those materials which may not, by law, be disposed of at a Class II disposal site. A description of Hazardous waste Materials shall be maintained on file at City Hall for inspection by the general public. 10. Refuse. The term I'Refusell shall mean solid municipal waste and/or trash, to include, but not be limited to residential refuse, commercial garbage, market refuse, food plant waste market greens, by-products, salvage junk, construction/demolition debris, _ tree trimmings and yard clippings in uncompacted form. Refuse shall include combustible and non-combustible rubbish and ashes. Refuse of types listed may be combined in the same containers(s). Separation of materials is not required. SECTION 20.02 - TERMS OF CONTRACT AND FRANCHISEE REOUIREMENTS. It is understood and agreed that the Franchisee is, and at all times shall be an independent Franchisee, and nothing contained herein shall be construed as making the Franchisee, or any individual whose compensation for services is paid by the Franchisee, an agent or employee of the City, or authorizing the Franchisee to create or assume any obligation or liability for or on behalf of the City. Further, in connection with any claim for liabilities against the City, by reason of any acts of the Franchisee agrees to indemnify and hold the City harmless therefrom. 1. Force Majeur. Either party to the contract is excused from default of performance because of conditions beyond his control, such as war, insurrection, strikes, riots, civil insurrection, hurricanes, earthquakes and floods, acts of God, and 14 any other cause beyond either partyls control. It is specifically understood that Mother cause beyond either partyls control" does not include, among other things, strikes, lockouts, other labor disturbances, or breakage or accidents to machinery, equipment or plants. 2. Exclusiveness of Contract. It is agreed that the Franchisee shall have the exclusive right during the term of this contract to collect, receive, transport, segregate, recycle and dispose of any and all refuse and bulky items generated by or within the City or under its jurisdiction, and to charge the fee then in effect for such services. This section shall not, however, be deemed to prohibit any person performing gardening or landscape services, and who possess an appropriate business license for such activity from carrying away from a customer's premises any clippings, branches, leaves and the like, generated by the gardening or landscape services performed. This section further shall not be deemed to apply to any person transporting his own refuse to a legally established dump site. 3. Failure to Perform. If the Franchisee is in default as provided in Article IY, or fails to collect materials herein specified for a period in excess of five (5) consecutive schedules working days, or in the sole judgement of the City fails to operate the system in a satisfactory manner for a similar period, the City may: a. Notify the Franchisee of the default and set a hearing to consider cancellation as provided in Article I, or notify the Franchisee by certified mail that the Franchisee has failed to perform waste disposal services for a period of five (5) consecutive, scheduled working days, and of the City's intent to take over as hereinafter set out and operate such services using Franchises Is equipment. Said notification shall state the date and time that the city intends to terminate the franchise, or b. Use and operate Franchiseels equipment itself until such matter is resolved and the Franchisee is again able to carry out his operation under this Agreement. Any and all operating expenses incurred by the City in so doing shall be paid to City by Franchisee as additional remuneration and shall not reduce the franchisee fee. Said payment shall be made to City within 30 days of billing. If not so paid, it shall accrue interest and be an additional breach of franchise. During such period, the liability of the City to 15 the Franchisee for loss or damage to such equipment so used shall be that of a bailee for hire, ordinary wear and tear being specifically exempt from such liability and burden of proof regarding negligence being that of Franchisee. The liability of the Franchisee to third persons shall cease and all claims or demands arising out of the operation of the collection service shall be directed solely to the city. Provided, however, if the Franchisee is unable for - any cause to resume performance at the end of 30 calendar days, all liability of the City under this Agreement to the Franchisee shall cease and the City shall be free to negotiate with other Franchisee for the operation of said collection service. Such operation with another Franchisee shall not release the Franchisee herein of his liability to the City for such breach of this Agreement. c. In case of termination and City operation, the City shall have access to the Franchiseels records for the purpose of billing, and shall retain all payments and funds received for the period for which the City provides service. The purpose of the Agreement is to facilitate the orderly collection of refuse and preserving the general health, safety and welfare of City residents. Accordingly, the City has the right to determine when the Franchisee has not preformed disposal services satisfactorily, thereby constituting a failure to perform. 4. Sale of By -Projects. The Franchisee shall be entitled to all revenue generated through it performance under the terms of his contract, including the sale of salvageable materials, except as specified in Exhibit A, Recycling Agreement. All such revenue derived therefrom shall not be subject to payment of a franchise fee. S. Rights, Remedies and Benefits of Franchise Agreement. It is agreed that each and every one of the rights, remedies and benefits provided by this Agreement shall be cumulative, and shall not be exclusive of any other of said rights, remedies and benefits, nor of any other rights, remedies and benefits allowed by law. 6. Waivers. One or more waivers of any covenant, agreement or condition of default regarding provisions of this agreement by either the City of Franchisee shall not be construed as a waiver of a further breach of the same covenant, agreement, condition or the right of such party thereafter to enforce each and every provision. The subsequent acceptance by City of any franchise fee or of any other moneys which may become due hereunder to city shall not be deemed to be a waiver of any preceding breach or violation by Franchisee of any term, covenant or condition of this Agreement. 16 7. Approval by City. Wherever approval by City is required, it shall mean approval by the Administrative Authority, or as directed by the City Council. 8. Notices Under Franchise Agreement. All notices, demands, request, approvals, disapprovals, proposals, consents or other communications whatsoever which this agreement contemplates or authorize, or requires or permits either party to give to the other, shall, except as otherwise provided be in writing and shall be personally delivered or sent by registered or certified mail, postage prepaid, return receipt requested, addressed to the respective party as follows: If the City: City of La Quinta 78-105 Calle Estado La Quinta, CA 92253 ATTN: City Manager If to the Franchisee: Waste Management of the Desert, Inc. 41-575 Eclectic Palm Desert, CA 92261 ATTN: General Manager or to such other address as either party may from time to time designate by notice to the other given in accordance with this section. Such notice shall be deemed effective on the date personally served or, if mailed, three days from the date the notice is deposited in the mail. -- Notice by City Franchisee of the alleged failure, refusal or neglect by Franchisee to collect, remove and/or transport any refuse required to be collected by Franchisee pursuant to this _ agreement, may be given to Franchisee orally by telephone at Franchiseels principal office. Written confirmation of such oral notification shall be sent to Franchisee within twenty-four (24) hours of the oral notification. Notice that either party intends - to rely upon the occurrence of any event itemized in Section 20.02- 1 to suspend obligations under this Agreement may be given verbally, provided that written notice is provided immediately - following such verbal notification. 9. Arbitration. Any controversy or claims arising out of _ or relating to this Agreement, or breach thereof, shall be settled by arbitration in accordance with the rules of the American Arbitration Association, and judgement upon the award rendered by the arbitrators may be entered in any court having competent - jurisdiction thereof. Such controversy or claim shall be submitted to one arbitrator selected from the local panel of the American 17 Arbitration Association. 10. venue and Legal Jurisdiction. The parties hereby agree that as to any action, whether real or asserted, at law or in equity, arising out of the terms and conditions of this agreement, venue and jurisdiction for such action shall be exclusively in a state court of competent jurisdiction in Riverside, California. The parties agree to waive any potential claim to diversity jurisdiction under Title 28 U.S.C. 81332 or any other statute, law -- or judicial authority which actually or colorably provides for federal jurisdiction. 11. Paragraph Headings. The paragraph headings of this Agreement are not a part of this Agreement and shall have no effect upon the construction or interpretation of any part of this Agreement. 12. Entire Agreement. This document contains the entire Agreement of the parties hereto with respect to matters covered hereby, and no other agreement, statement or promise made by any party hereto, or agent of such party, which is not contained herein, shall be binding or valid. No purported modification, amendment or other change in this Agreement shall be valid unless -- set forth in writing, and signed by both Franchisee and City. 13. Subletting Agreement. This Agreement, or any portion — thereof, shall not be sublet except with the written consent of the City. No such consent shall be construed as making the City a party to such subcontract, or subjecting said City to liability of any kind to any subcontractor. 14. Compensation to Franchisee. As full compensation to the Franchisee for the service performed and per the terms of this -- Agreement, the Franchisee shall be entitled to collect the service fee then in effect for all matter collected by the Franchisee under the terms of this Agreement. 15. Fees for Refuse Collection. Fees for refuse collection shall be set by resolution of the City Council and shall continue in full force and effect until amended by resolution of the City Council. 16. unusual Conditions. For collections requiring special equipment or otherwise not set forth in the Agreement, fees may be charged as shall be agreed upon by the Franchisee and the customer. Franchisee shall notify City of said consent. 17. Assignment. This agreement is assignable only with written consent of both parties. Such consent shall not be -- withheld unreasonably, nor shall such consent be required in the event of (i) an assignment by operation of law, (ii) an assignment is by city to the State of California or to any agency or subdivision of the State or of City if such entity undertakes responsibility for the collection of refuse from which Franchisee is granted an exclusive license, or (iii) an assignment to an affiliate, subsidiary or co -subsidiary of Franchiseels parent company, Waste Management of North America, Inc. where such affiliate or subsidiary has demonstrated the financial and technical ability to perform the services and responsibilities required by this Agreement. violation of the provisions of this paragraph is a -- material breach of this Agreement. 18. Change of ownership or Control. The City, in entering this Agreement, has placed a special value, faith and confidence upon the experience, background and expertise of the Franchisee in the field of waste disposal. Such faith and confidence being a substantial consideration in the granting of this agreement, the parties hereto agree therefore that no change of ownership or transfer of stock in the Franchiseels business in an amount equal to or greater that 10% of such ownership or stock shall take place without the prior written consent of the City. Such faith and confidence being a substantial consideration in the granting of this Agreement, the parties hereto agree as follows: -- (a) Cityls Consent to Transfer Upon Change in Control. The Franchisee shall promptly notify the City of any proposed change in control of the Franchisee with respect to which the consent of the City is required. Such change in control shall make the franchise null and void unless and until the City shall have consented thereto. For the purpose of determining whether it will consent to such change, transfer, or acquisition of control, the City may inquire into the qualifications of the prospective controlling party, and the Franchisee shall assist the City in any such inquiry. The City may condition said transfer upon the terms and conditions it deems appropriate. (b) Presumption of Change in Control. For the purpose of this section, a presumptive change in control will exist upon sale or transfer of 10% or more of the Franchiseels stock to an entity not affiliated with Franchiseels parent company, Waste Management of North - America, Inc., or except as provided in section 20.02, Paragraph 17(111), the transfer of control and/or the delegation of substantial management function or duties to someone other than Franchisee. 19. Successors and Assigns. Except as in Paragraphs 17 and 18 above, the terms, Covenants and conditions of this Agreement shall inure to the benefit of and shall be binding upon the respective successors and assigns of the parties hereto. 19 20. Franchiseels =210yem Relations. Amounts of pay, vacation leave, sick leave, holiday leave, fringe benefits, and other employee -related matters applicable to Franchisee's employees shall be wholly within the discretion of the Franchisee. 21. Bankruptcy. If the Franchisee shall at any time during the term of this Agreement become insolvent, or if proceedings in bankruptcy shall be instituted by or against the Franchisee, or if the Franchisee shall be adjudged bankrupt or insolvent by any court, or if a receiver or trustee in bankruptcy or a receiver of any property of the Franchisee shall be appointed in any suit or proceeding brought by or against the Franchisee, or if the Franchisee shall make an assignment for the benefit of creditors, -- then and in each and every such case, this Agreement and the rights and privileges granted thereby shall immediately cease, determine, and be forfeited and canceled without notice and without suit or other proceedings. 22. Invalid Provisions. The parties agree that in the event any covenant, condition or provision herein contained is held to be invalid by any court of competent jurisdiction, the invalidity hereof shall in no way affect any other provision in this Agreement if the provision does not materially prejudice either the --- Franchisee or the City in their respective rights and obligations hereunder. 23. Waiver of Performance. The failure of either party to insist in any instance upon a strict performance by the other party of any of the provisions, terms, covenants, reservation, conditions or stipulations contained in the Agreement, shall not be considered a waiver thereof, and the same shall continue and remain in full force and effect. No waiver by the City of any provision, terms, covenants, reservation, condition or stipulation contained in this Agreement shall be deemed to have been made in any instance unless expressed in the form of a resolution by the City Council. 24. Warranty. The Franchisee warrants that he has not employed any officer or employee of the City, nor offered any gift, gratuity, contingent fee nor any other thing of value to such officer or employee of the City seeking assistance in obtaining this contract. 25. Non-discrimination. Contractor agrees that, in the performance of this Agreement, it will not refuse or fail to hire or employ any qualified person, or bar or discharge from employment any person, or discriminate against any person with respect to compensation, terms conditions or privileges of employment, because of such person1s race, color, 20 creed, national origin, ancestry, sex or sexual preference. Contractor also agrees that, in the performance of this Agreement, it will comply with the provisions of any and all state and federal statutes, and regulations promulgated thereunder, relating to employment discrimination. ARTICLE ZZI OPERATIONAL REQUIREMENTS SECTION 21.01 - COLLECTION OF REFIISE A. Operational Requirements. It is understood and agreed by the parties hereto, that all operational requirements shall apply to each party or both parties as applicable and necessary to the effectiveness of this contract. Operational requirements governing the hour and time of collection, size of containers, weight of containers, location of containers, and other related solid waste requirements of each party, shall be set by resolution of the City Council (Exhibit C), and shall continue in full force and effect until amended by a subsequent resolution of the City. In the event of conflict between these provisions and those contained in Chapter 6 of the - Municipal Code of the City, the more restrictive provisions shall be applicable to the Franchisee. The term "refuse" as used herein, shall mean solid municipal waste and/or trash, as herein above defined. B. Equipment. 1. The Franchisee shall provide sufficient collection equipment to maintain a regular schedule of collection. 2. Collection equipment shall be maintained in reasonable working condition, and painted uniformly. 3. Franchiseels vehicle collection bodies shall be washed thoroughly on the inside daily and sanitized with a suitable disinfectant at least weekly. All Franchisee's vehicles shall be washed on the outside at least weekly. 4. Franchisee shall maintain a good repair of all containers furnished to business establishments. S. Residences and dwelling units which furnish their own 32 gallon containers shall be responsible for their maintenance cleanliness and replacement. Rigid free standing containers must be water tight and free from leakage, have two handles in good working order, be equipped with a lid of proper size and maintained in a clean condition. 21 6. Franchisee and business establishment shall be responsible as herein provided for furnishing refuse accumulation containers in the size and quantity required to contain in the proper manner, with lid closed, all of the refuse generated between collection periods. C. Quality of Service. 1. The direction and supervision of the refuse collection and disposal operation, including all subcontractors, foreman and workman employed by Franchisee, shall be competent, qualified and sober personnel, to insure performance satisfactory to the City, and to serve the public in a courteous, helpful and impartial manner. 2. The Franchisee shall furnish the City with every reasonable opportunity for ascertaining whether or not the work is performed in accordance with the requirements of this contract. 3. The Franchisee shall designate the person to serve as agent and liaison between his organization and the City. 4. The City may inspect the Franchisee's operation and equipment at any reasonable time and the Franchisee agrees to admit -- him to make such inspection. This Agreement, consisting of sixteen (16) pages, not including exhibits or schedules attached hereto, shall be executed in triplicate, of which each executed copy shall have the full force and effect of the original. EXHIBIT A - RECYCLING AGREEMENT 22 CITY OF QUINTAI XFORNIA s _ mayor Date C ty Manager Date A T: ity Clerk Date WASTE/ G OF THE DESERT, INC. i2,40 GeAerff mantler to APPROVED AS TO FORM: -�Y9t �d&Jq,o La Quinta City Attorney Date Franchisee Counsel Date 23 THE CITY OF LA OIIINTA AND HASTE OF THE DBSBRT, INC. RECYCLING AGREEMENT Exhibit "All SECTION 1. TERM OF AGREEMENT SECTION 2. SCOPE OF SERVICES A. Curbside Recycling 1. Collection 2. Recyclable Materials Defined 3. Time of Collection 4. Container Purchase and Distribution 5. Replacement of Containers 6. Transportation of Materials 7. Labor and Costs 8. Missed Pickups B. Multifamily Recycling 1. Collection 2. Multifamily Recycle Material Defined 3. Time of Collection 4. Container Purchase and Distribution 5. Transportation of Materials 6. Labor and Costs 7. Requested Pickups C. Commercial Recycling 1. Collection 2. Commercial Recycle Material Defined 3. Time of Collection 4. Container Purchase and Distribution 5. Replacement of Containers 6. Transportation of Materials 7. Labor Costs 8. Missed Pickups D. Public Awareness Program E. Local Manager F. Reports G. Sale of Recyclable Materials H. Household Hazardous Waste SECTION 3. SCHEDULE OF PERFORMANCE SECTION 4. A. B. SECTION 5. A. B. C. D. SECTION 6. SECTION 7. SECTION 8. COMPENSATION Curbside and Multifamily Recycle Commercial Recycling CITY'S RESPONSIBILITIES City Representative Public Awareness Program Protection of Materials Permits for Recycling Center RECYCLING CONTAINERS FRANCHISEE'S RESPONSIBILITY AREA OF SERVICE SECTION 1. TERM OF AGREEMENT The term of this AGREEMENT to recycle shall coincide with the term of the Franchise Agreement. Said Recycling Agreement shall be subject to all provisions set forth in the Franchise Agreement. SECTION 2. SCOPE OF SERVICE A. Curbside Recycling FRANCHISEE shall perform curbside recycling services in the City of La Quinta as follows: 1. Collection. FRANCHISEE shall collect and remove all Recyclable Materials, which are segregated and placed in or adjacent to recycling containers at the curbside on public streets, from all single family residences and all residential complexes of four (4) or fewer units located in the City of La Quinta as of August 1, 1990, where garbage collection service is can collection (as opposed to bin collection). For those single family areas as identified above that are within walled communities on private streets, alternative recycling methods shall be offered to the homeowners' association. Examples of recycling methods are curbside, walk-in, central location containers, or others that may be approved by the City. Resolution of conflicts in recycling methodology shall be at the sole direction of the City. Curbside and central container recycling shall be done at no cost to the City or residential customer. Walk-in or other identified methods may require a negotiated recycling charge as determine by the City, payable either by the City or the residential customer. 2. Curbside Recyclable Materials Defined. For the purposes of this section, Recyclable Materials means and includes newspapers, glass, metal cans (aluminum and delabeled tin), used oil, plastic bottles and such other materials as mutually agreed upon in writing by FRANCHISEE and CITY, which are collected by FRANCHISEE pursuant to Paragraph 1 of this Section. 3. Time of Collection. FRANCHISEE shall collect the Recyclable Materials placed at the curbside for collection once each week, regardless of weather conditions. To the extent -- possible, collection will be on the same day of the week as garbage collection service. Collection schedules need not be maintained on the following holidays: January 1, Thanksgiving, and December _ 25. Collection which would normally occur on such holidays shall be reschedules as mutually agreed upon FRANCHISEE and CITY. Hours of collection shall conform with Article XXII of Franchise Agreement. 1 4. Container Purchase and Distribution. FRANCHISEE shall purchase and shall distribute one set of recycling containers to each eligible residence in the City of La Quinta, except in certain areas which have already received container sets or will recycle in another manner. The recycling containers are those containers described in Section 6, entitled "RECYCLING CONTAINERS" -- or other similar containers mutually agreed upon by FRANCHISEE and CITY. The ownership of the recycling containers purchased by FRANCHISEE under this AGREEMENT shall be and remain with FRANCHISEE. 5. Replacement of Containers. The FRANCHISEE hereby agrees to furnish each resident a set three (3) recycling containers. These containers will remain the property of the FRANCHISEE. Replacements of residents' containers, due to normal wear and tear, will be the responsibility of the FRANCHISEE. Replacement of containers due to theft, loss or damage will be charged to the resident at a charge not to exceed FRANCHISEE'S actual cost. 6. Transportation of Materials. FRANCHISEE shall transport the collected Recyclable Materials to a Recycling Center. FRANCHISEE shall retain responsibility for the sale of such materials in a timely manner for the collection of payments — therefore. The Recycle Center may be owned by FRANCHISEE or privately owned. If the FRANCHISEE must follow the same planning and permit process as any other business with similar land use. 7. Labor and Costs. FRANCHISEE shall, at its sole cost and expense, except as otherwise provided herein, furnish all labor and equipment required to perform curbside collection pursuant to this AGREEMENT. 8. Missed Pickups. In case of a missed pickup called in by a resident, FRANCHISEE shall collect the Recyclable Materials from such resident within twenty-four (24) hours. All calls relating to missed pickups shall be logged in by FRANCHISEE and such log shall be available for inspection by CITY. B. Multifamily Recycling FRANCHISEE shall perform multifamily recycling services in the CITY OF LA QUINTA, as follows: 1. Collection. FRANCHISEE mutually agrees with city and property owner to collect and remove all Recyclable Materials which are segregated and placed in or adjacent to multifamily complexes with two or more residential units located in the City of La Quinta as of August 1, 1990, where garbage collection service is a bin collection. 2 2. Multifamily Recyclable Materials Defined. For the purposes of this section, Recyclable Materials means and includes newspaper, glass, metal cans, plastic bottles and such other materials as mutually agreed upon in writing by FRANCHISEE and City, which are collected by FRANCHISEE pursuant to Paragraph of this section. 3. Time of collection. FRANCHISEE shall collect the recyclable material on a regular basis, no less than the time required to fill the bin. 4. Container Purchase. FRANCHISEE shall purchase and shall distribute a multifamily recycling container to eligible complexes. This container shall be specifically designed for such recycling in order to reduce material theft and product contamination. The ownership of such containers purchased by FRANCHISEE shall be and remain with FRANCHISEE. 5. Transportation of Materials. FRANCHISEE shall transport the collected Recyclable Materials to a recycle center and FRANCHISEE shall retain responsibility for the sale of such material in a timely manner. 6. Labor and Costs. FRANCHISEE shall, at its sole cost and expense, except as otherwise provided herein, furnish all labor and equipment required to perform multifamily recycle collection. 7. Requested Pickups. In the event the FRANCHISEE missed a normal pickup or the recycle bin fills prior to a normal pick-up, FRANCHISEE shall collect the Recyclable Material from such complex within twenty-four (24) hours of notice by City or property manager/owner/tenant. All calls relating to missed or additional pickups shall be logged in by FRANCHISEE and such log shall be available for inspection by CITY. C. Commercial Recycling FRANCHISEE shall perform commercial recycling services in the City of La Quinta as follows: 1. Collection. FRANCHISEE shall collect and remove designated Recyclable Materials, which are separated and placed in separate bins, from all businesses located in the City of La Quinta as of April 15, 1990. 2. Commercial Recyclable Material Defined. For the purpose of this section, Recyclable Materials means and includes glass, corrugated cardboard, computer paper, white paper and such other materials as mutually agreed upon in writing by FRANCHISEE and City, which are collected by FRANCHISEE pursuant to Paragraph 1 of this section. 3 3. Time of Collection. FRANCHISEE shall collect the Recyclable Materials placed in a designated location for periodic collection regardless of weather conditions. To the extent possible, collection will be on the same day of the week as regular garbage service collection. Schedules need not be maintained on the following holidays: January 1, Thanksgiving, and December 25. 4. Container Purchase and Distribution. FRANCHISEE shall distribute one bin per Recyclable Material. The recycle --- containers shall be of type and design specifically for commercial recycling and FRANCHISEE shall coordinate size specifically for recyclable material and available storage space of business. The ownership of the recycle bins purchased by FRANCHISEE under this agreement shall be and remain with FRANCHISEE. 5. Replacement of Containers. FRANCHISEE will keep bins in proper condition. The parties acknowledge that from time to time bins will get damaged, and when bins become unusable, FRANCHISEE shall replace bins with useable commercial recycling __. bins. 6. Transportation of Materials. FRANCHISEE shall transport the collected Recyclable Materials to a Recycle Center in a timely manner. 7. Labor and Costs. FRANCHISEE shall, at its sole cost and expense, except as otherwise provided herein, furnish all labor and equipment required to perform commercial recycling collection pursuant to this agreement. 8. Missed Pickups. In case of missed pickup or full bin called by a business, FRANCHISEE shall collect the Recyclable Materials from such business within twenty-four (24) hours. All calls relating to missed or extra pickups shall be logged in by FRANCHISEE and such log shall be available for inspection by CITY. D. Public Awareness Program. FRANCHISEE shall develop and implement that portion of the Public Awareness Program designated "FRANCHISEE'S RESPONSIBILITIES." 4 1. Contractorls Responsibilities. a. Introductory Packet. FRANCHISEE will prepare a separate Introductory Packet of information regarding the curbside recycling program, multifamily recycling program and commercial recycling program, approved in advance by CITY, and will distribute such packet as needed to promote required by City. The packet shall include: (1) A letter from the Mayor and the City Council of the City of La Quinta urging the residents and businesses to participate in the program. (2) A two-part information card containing specific information to the resident regarding collection day, non -collection holidays, preparation of materials, and other appropriate matters. There will also be a tear -off and mail -in card for volunteers. b. Upon request by CITY, FRANCHISEE will assist CITY in developing a listing of non -participating households or business in the City of La Quinta. C. FRANCHISEE will assist CITY'S public awareness efforts wherever possible. 2. city's Responsibilities. a. CITY will contact all local media to seek coverage of the recycling program to increase citizen awareness of the benefits of recycling. b. CITY will develop an over all @'Promotional Plane for the La Quinta Recycling Program. C. City will assist FRANCHISEE'S public awareness wherever able. E. Local Manager. FRANCHISEE shall at all times during the term of this agreement have a local manager charged with the — responsibility and recycling supervision and operations of FRANCHISEE, and shall at all times during the term of this Agreement maintain a local office and telephone in their Palm Desert office. F. Reports. FRANCHISEE shall file with CITY written reports of FRANCHISEE'S performance. FRANCHISEE shall submit to CITY the following reports, 5 1. Monthly Project Reports. Within fifteen (15) working day after the last day of each month, FRANCHISEE shall submit a monthly project report to include at least all of the following: — a. Summaries of tonnages of all Recyclable Materials recovered, by material. b. Summaries of tonnages of all Recyclable Materials sold, by material. c. Market prices for all Recyclable Materials collected from curbside and sold by FRANCHISEE. The weight receipts shall be available for inspection by CITY upon request. _ d. Resident participation rates in terms of weekly set - out counts, and monthly participation rates, calculated at 2.5 times the average weekly set -out rate. e. A summery of missed pickups by route and explanation of noteworthy experiences, and a summary of telephone calls received by category, including inquiries about the program, missed pickups, and container replacement. 2. Yearly Project Status Reports. Within sixty (60) working days from the end of each year, FRANCHISEE shall submit a yearly project status report to include ._ at least all of the following: a. Summary of all revenues, tonnages recovered by material, and participation rates. b. Overall assessment of performance during the year. - C. Detailed data to allow analysis of collection and processing equipment handling capabilities. d. Discussion of problems and noteworthy experiences in program operation. 3. Reports. a. All reports for curbside, multifamily, commercial recycling, as well as other programs mutually agreed on by both parties, shall be sent to: City of La Quinta City Manager 78-105 Calle Estado La Quinta, CA 92253 6 G. Sale of Recyclable materials. FRANCHISEE shall sell all Recyclable Materials collected by FRANCHISEE pursuant to this agreement at fair market value. Revenue obtained from such sales shall be retained by FRANCHISEE except as provided in Section 4 hereof. The fair market value(hereafter "Fair Market Value") of Recyclable Materials, shall be the highest price commonly paid by -- purchasers of such materials in the Coachella Valley area at the time of sale. Fair Market Value will be determined from written price quotes submitted to the CITY, and any change in Fair Market - Value shall take effect prospectively upon written notice to FRANCHISEE thereof. FRANCHISEE and CITY shall mutually agree on how often and which entities will be solicited for such price quotes. H. Household Hazardous Waste. - FRANCHISEE will coordinate, promote and assist the CITY to implement a yearly household hazardous waste collection program. FRANCHISEE shall provide pickup of all non -hazardous material, as well as promote this event through billing or other similar activities. FRANCHISEE shall also provide material and labor to assist operation, with the exception of handling of hazardous waste. In the event the County of Riverside, Department of Health, Division of Hazardous Waste, is unable to carry out the Collection of Household Hazardous Waste, for CITY residents the FRANCHISEE shall be solely responsible for the collection or subcontract the collection of household hazardous waste. CITY shall approve such program. FRANCHISEE is authorized to negotiate reimbursement for program from County of Riverside. SECTION 3, SCHEDULE OF PERFORMANCE. A. FRANCHISEE shall perform those services set forth in Section 2 of this Exhibit in accordance with the Schedule of Performance as follows: 1. August 1, 1990, FRANCHISEE shall complete delivery of containers to all single family homes an gated communities with curbside service; 2. August 1, 1990, FRANCHISEE mutually agrees with CITY and property owner to initiate multifamily recycle program to all complexes. 3. September 1, 1990 FRANCHISEE initiates commercial recycling to volunteer businesses. In the event unforseen circumstances arise, which would cause a delay in performance, said Schedule of Performance may be modified accordingly by the mutual written agreement of CITY and FRANCHISEE. The City Manager is authorized to modify said Schedule of Performance on behalf of City. 7 A. FRANCHISEE will provide all of the services described in Section 2 of this exhibit at no additional cost to the residents or the CITY. All equipment, service labor, and other expenses, shall be incurred by FRANCHISEE. The curbside and multifamily recycling program shall be accounted for separately from the garbage collection. All revenues received from the sale of the recycled material shall go to the FRANCHISEE to offset to the operating costs of the curbside and multifamily recycle programs. In the event these recycle programs become "self sufficient", the revenues received from the sale of the recycled material over and above the operating costs shall be split between the CITY and FRANCHISEE,. with each receiving fifty percent (50%). "Self sufficient" shall refer to the revenues from the sale of the recycle material plus the landfill diversion gain, minus the operation costs. Operating costs shall be defined as those items outlined in Exhibit 1 of the recycling agreement. Upon request by the CITY,FRANCHISEE shall submit a detailed curbside multifamily recycle program annual summary completed by independent auditor retained by FRANCHISEE. In no event shall the CITY pay for the recycling program. B. Commercial Recycling. FRANCHISEE will provide all of the services described in Section 2 of this exhibit at no additional cost to the businesses and/or the CITY. All equipment, service, labor and other expenses for commercial recycling shall not increase the cost of a business solid waste collection service. FRANCHISEE shall subtract a portion of the gross revenues from sale of the commercial recycling materials from the businesses monthly waste bill. The following breakdown will be the percentage by product of payment to business: 1. Glass recycling - 25% 2. White paper - 33% 3. Computer paper - 33% 4. Newsprint - 25% 5. Corrugated cardboard - 25% Percentage of gross revenues (identified above) to be credited back to businesses shall be evaluated annually, in June of each year, to determine appropriate percentage to be credited. Evaluation will be made of the market prices for the various recyclable materials. 8 All other commercial materials determined to be recyclable shall have a percentage of gross revenue credited back to businesses at a rate mutually agreed upon by both the CITY and FRANCHISEE. FRANCHISEE will develop a standard volume/weight ratio for each material. Volume/weight ratios shall be approved by CITY. FRANCHISEE'S employees shall estimate and log all pickups and results shall be provided to individual businesses on monthly basis - with invoice. The invoice shall be adjusted to reflect deduction caused by Recyclable Materials collection at each business. FRANCHISEE shall agree to work with any business desiring to recycle. Each material will be determined by feasibility of success and landfill diversion. SECTION 5. CITY'S RESPONSIBILITIES. A. CITY Representative. CITY'S representative for purposes of this agreement shall be City Manager or his designee. B. public Awareness Program. CITY shall participate in the Public Awareness Program as provided in Section 2d. C. Protection of Materials. CITY agrees to participate in the Public Awareness Program as provided in Section 2d. D. Permits for Recycling Center. CITY shall assist FRANCHISEE, to the extent reasonably possible, in obtaining such permits and licenses necessary of FRANCHISEE to operate or construct a recycling facility of sufficient size to administer the city-wide recycling program, if FRANCHISEE desires to open recycling center. SECTION G. RECYCLING CONTAINERS. A. FRANCHISEE shall provide a set of three (3) "Recycle 3" containers to each eligible residence in the CITY. These containers are specially made of rigid plastic construction for stacking in each other, to assist homeowners to participate in the curbside recycling program. One container is used to store bottles, one for cans and one for newspapers. FIGURE A depicts the containers in use. Any change in the containers shall be mutually agreed upon by FRANCHISEE and CITY. 0 Set of Recycta 03" Oontainsm O1NTRACTORIB RESPONS A. FRANCHISEE shall designate an individual and retain an individual on a full time basis for the duration of this agreement for purposes of recycling. Said recycle position will be responsible for coordinating and communicating all recycling programs, as well as be the contact person representing FRANCHISEE in all matters regarding recycling. B. FRANCHISEE shall cooperate with CITY to abide by all recycling, waste minimization and waste reduction laws passed by - State and Federal legislation. This includes maintenance of data and records, along with preparation of reporting documents. C. FRANCHISEE shall cooperate with CITY to recycle certain material not recycled within current program. The implementation of an expanded recycle program shall consist of any reasonable material mutually agreed with CITY. ANT A. Area of service shall be the entire area within the city limits of CITY. The area of service will change periodically due to annexations. FRANCHISEE will be responsible for all recycling programs in newly annexed areas. In the event the FRANCHISEE does not serve all residents or business in the annexed areas for a period of time, such as a transition period, FRANCHISEE shall be responsible for all recycling programs to those residents and businesses served by FRANCHISEE. 10 XVI.Interest: XVII.Corp. S & D: XVIII.Other Income/Expense: Staff for support, technology, etc. Interest paid on capital purchases, currently 9%. One percent of total revenues paid to our corporate office staff for support, technology, etc. Gain/los on sale of capital equipment EXHIBIT 1 I. Drivers & Helpers: II. Truck Operating Expense: III. Truck Maintenance -Labor: IV. Truck Maintenance Tires: V. Truck Maintenance -Outside: VI. Truck Maintenance -Other: VII. Container/Comp. Maintenance: VIII.Insurance & Claims: IX. Building Occupancy: X. Truck Depreciation: XI. Container Depreciation: XXI.Other Hauling: XII.S. & G. A. - Salaries: XIV.S. & G. A. - Other: XV. Management Fees: Actual Drivers and Supervisor wages plus Payroll Taxes, Benefit Plan (Insurance Pension, Profit Sharing, etc.) and uniforms. Fuel, oil, licensing and truck washing. Shop labor, includes same categories as drivers and helpers. Tire expense. Vehicle repairs performed by an outside company. Repair parts, truck painting, and towing. Repairs to commercial containers. Workers compensation, auto and liability insurance. Facility usage including utilities based on percentage of trucks. Depreciation based on 8 year vehicle life. Cost of residential containers depreciated over 5 years plus cost of commercial containers depreciation over 10 years. Permits, business licenses, franchise fees, etc. In-house recycling coordinator plus administration allocation. Office Supplies One percent of total revenues paid to our Regional Office Addendum #2 to Waste Management Contract for Refuse Collection and Disposal The purpose and intent of this Addendum is to amend Article II, Section 2.01, Article XIII, Article XV, and Article XX, Section 20.01 and 20.02 for the remainder of this contract. The parties hereto have mutually covenanted and agreed as follows: 1. Second Addendum. This Second Addendum is an amendment to the Franchise Agreement dated September 10, 1990 and will supersede the provisions of the Franchise Agreement to the extent that such provisions are inconsistent with the provisions of this Second Addendum. 2. Article II, Section 2.01 - Scope of Work of the Franchise Agreement (Page 1) shall be amended to read as follows: Franchisee shall transport and deliver all refuse collected pursuant to this agreement to the disposal site(s) designated by the City. The work to be done consists of collecting and disposing of residential and commercial refuse within the corporate limits of the City. It further includes the furnishing of all labor, methods or processes, tools, equipment and transportation necessary to meet the requirements of the Agreement. All collections and disposal contemplated hereunder shall be done and performed promptly in a good, thorough, workmanlike and efficient manner to the reasonable satisfaction of the Administrative Authority, designated by the City. Franchisee shall maintain accurate records of the quantities of refuse delivered to the disposal .site(s) and will cooperate with the City in any audits or investigations of such deliveries. Franchisee shall cooperate with the operator of the disposal site(s), with regard to operation therein, including by way of example, complying with directions from the operator to unload collection vehicles in designated areas, Resoce.151 accommodating to maintenance operations and construction of new facilities, and cooperating with the operator's Hazardous Waste Exclusion Program. 3. Article XIII paragraph number one of the Franchise Agreement (page 9) shall be amended to read as follows: The Franchisee shall have the exclusive right and privilege within the City, to collect and dispose of refuse. Refuse is defined herein and in Chapter 6 of the City of La Quinta Municipal Code. Except as otherwise herein provided, the Franchisee shall not be required to provide service to anyone not using containers furnished by the Franchisee. Franchisee shall transport and deliver all refuse collected pursuant to this agreement to the disposal site designated by the City. Refuse, solid waste, rubbish, and garbage shall become the exclusive property of the disposal site(s) (or other designee of the City as the City may determine from time to time) once it is delivered to the disposal site(s). The Franchisee shall not be required to collect or dispose of any hazardous waste materials except as allowed by law. 4. Article XV of the Franchise Agreement (pages 10 and 11) shall be amended to add as follows: 5. If Franchisee experiences increased operation costs due to increased transportation/operational costs resulting from City designating a disposal site(s), different than the site upon which the current rates are based, Franchisee is entitled to an increase in rates charged. Adjustments. to the service rates shall be requested in writing by Franchisee in accordance with the following: Franchisee must, to the satisfaction of both a City appointed auditor and the City, document increases in the transportation/operational costs. In the event the costs have been documented and substantiated, Franchisee shall be entitled to any increase not to exceed the amount necessary to recover the total net cost increases. 5. Article II, Section 20.01 of the Franchise Agreement (page 14) is amended to add as follows: 11. Disposal Site. The term "Disposal Site" means the solid waste facility or facilities designated by the City for the ultimate disposal (by the Franchisee) of refuse, solid waste, garbage and bulky items collected by the Franchisee. The disposal site may include, but is not limited to, a solid waste landfill and a solid waste transfer or processing station, or a combination thereof. Resocc.151 6. Article XX, Section 20.02, paragraph 2 of the Franchise Agreement (page 15), is amended to read as follows: 2. Exclusiveness of Contract. It is agreed that the Franchisee shall have the exclusive right during the term of this contract to collect, receive transport and segregate any and all refuse, municipal solid waste, trash and bulky items generated within the corporate limits of the City, and to charge the fee in effect for such services. Franchisee shall transport and deliver all refuse, municipal solid waste, trash and bulky items pursuant to this agreement to a disposal site(s) designated by City. This section shall not, however, be deemed to prohibit any person performing gardening or landscape services, and who possesses an appropriate business license for such activity from carrying away from a customer's premises any clippings, branches, leaves and the like, generated by the gardening or landscape services performed. This section further shall not be deemed to apply to any person transporting his own refuse to a legally established dump site. CITY OF LA QUINTA, CA THOMAS P. GENOVESE City Manager jl"elll�5-- Date Resocc.151 WASTE MANAGEMENT 0 HE DESERT, INC. �1 PA SOMMERVILLE General Manager Date ADDENDUM WASTE MANAGEMENT CONTRACT RECYCLING AGREEMENT As originally approved by City Council on September 4, 1990, by and between the parties of WASTE MANAGEMENT OF THE DESERT, INC. (franchisee) and the CITY OF LA QUINTA (City). The purpose and intent of this Addendum is to amend Section 2. Scope of Service; Part A. Curbside Reg cY ling; Paragraph 5. Replacement of Containers of the Recycling Agreement for the period of November, 1994 through November, 1995. New language is in italics; deleted language is struck over. 5. Replacement of Containers. The FRANCHISEE hereby agrees to furnish each resident a set of three (3) recycling containers. These Containers will remain the property of the FRANCHISEE. Replacement of residents' containers, due to normal wear and tear, will be the responsibility of the FRANCHISEE. Replacement of containers due to theft, loss or damage will be charged to the fes City at a charge not to exceed FRANCHISEE's actual cost. FRANCHISEE will submit a quarterly bill to the City together with the recycling report, specifying the name and address of the resident, indicating the number Of replacement containers and cost per container. The total due and owing shall also be calculated on the quarterly bill. FRANCHISEE is to use good judgement and reasonableness in the replacement of containers, obtaining approval in advance from the CITY in the case of any resident requesting continual replacement or replacement beyond that normally expected for a residential customer. The above amendment was identified as a program the City would implement with the approval of the AB 939 Compliance Fee by the City Council on July 9, 1993. Expenditure in excess of $2,000 will require advance approval from the Administrative Authority of the City. This Addendum is limited to a time period of December 1, 1994 through November 5, 1995. Should the City Council elect to again fund replacement of recycling bins, an extension of the Addendum would be required. In the event the City Council discontinues funding in a prospective fiscal year, the original language shall immediately become effective. THE CITY OF LA QUINTA THOMAS P. GENOVESE, or Designee City Manager 2 2 0 `� `/ Date WASTE MANAGEMENT OF T SERT, INC. RAYMOND P. BURKE, or Designee General Manager PATTY SONWIERVILLE, DIVISION PRESIDENT Date %,/a— i--- DOCFB.018 1 ADDENDUM WASTE MANAGEMENT CONTRA RECYCLING AGREEMENT POCT 25 1993 As originally approved by City Council on September 4, 1990, b NN ID of WASTE MANAGEMENT OF THE DESERT, INC. (franchisee) and the CITY OF LA QUINTA (City). The purpose and intent of this Addendum is to amend Section 2. Scope of Service; Part A. Curbside Recycling; Paragraph 5. Replacement of Containers of the Recycling Agreement for the period of November, 1993 through June 30, 1994. New language is in italics; deleted language is struck over. 5. Replacement of Containers. The FRANCHISEE hereby agrees to furnish each resident a set of three (3) recycling containers. These Containers will remain the property of the FRANCHISEE. Replacement of residents' containers, due to normal wear and tear, will be the responsibility of the FRANCHISEE. Replacement of containers due to theft, loss or damage will be charged to the fesiden City at a charge not to exceed FRANCHISEE's actual cost. FRANCHISEE will submit a quarterly bill to the City together with the recycling report, specifying the name and address of the resident, indicating the number of replacement containers and cost per container. The total due and owing shall also be calculated on the quarterly bill. FRANCHISEE is to use good judgement and reasonableness in the replacement of containers, obtaining approval in advance from the CITY in the case of any resident requesting continual replacement or replacement beyond that normally expected for a residential customer. The above amendment was identified as a program the City would implement with the approval of the AB 939 Compliance Fee by the City Council on July 9, 1993. Expenditure in excess of $1,000 will require advance approval from the Administrative Authority of the City. 4 This Addendum is limited to a time period of November 1, 1993 through June 30, 199.X. Should the City Council elect to again fund replacement of recycling bins, an extension of the Addendum would be required. In the event the City Council discontinues funding in a prospective fiscal year, the original language shall immediately become effective. THE CITY OF LA QUINTA ROBERT L. HUNT, or Designee City Manager .. (� —? ae--)l /��'3 Date WASTE MANAGEMENT OF T DESERT, I RAYMOND P. BUME, or es General Manager 10 Date DOCFB.018