Date: June 30, 2026 Subject: Solid Waste Management Services \u2014 Request for Proposal (RFP) Evaluation<\/p>\n
Editor\u2019s note: This is a cleaned, readability-edited version of an automatically generated transcript. Filler words, false starts, and obvious transcription errors have been removed, and names have been corrected where possible. The wording is otherwise kept close to the original. Speaker labels are best-effort; where a speaker could not be reliably identified, a neutral label is used.<\/p>\n
(Following closed session)<\/p>\n
Mayor Jung: I\u2019ll call this special study session meeting to order for June 30, 2026. Madam Clerk, please call the roll.<\/p>\n
City Clerk: All present \u2014 Mayor Fred Jung, Mayor Pro Tem Nick Dunlap, Council Member Dr.\u00a0Shana Charles, Council Member Jamie Valencia, and Council Member Dr.\u00a0Ahmad Zahra.<\/p>\n
Mayor Jung: City Attorney, anything to report from closed session?<\/p>\n
City Attorney: No report.<\/p>\n
Mayor Jung: I\u2019ll ask any council members if there are ex parte communications to report. Seeing none. Now let\u2019s go to public comments. Madam Clerk.<\/p>\n
City Clerk: Would you like the public comment on the business item now?<\/p>\n
Mayor Jung: Business item now, please. This is a special meeting, so public comments are limited to the items on the agenda.<\/p>\n
City Clerk: I have three people registered \u2014 Francisco Miranda, Shawna Adam, and Julie. Those who signed up for public comment, if you heard your name called, please come forward.<\/p>\n
Public Comments<\/p>\n
Resident (unidentified): Good evening. I have to differ \u2014 this is not a study session, it\u2019s a regular meeting, so we can have regular public comment.<\/p>\n
Mayor Jung: Is this about the business item, which comes up later on the agenda? There\u2019s regular public comment on the agenda and then the business item later. This has been noticed as a special meeting.<\/p>\n
Resident (unidentified): If you look at the agenda, it shows both. The agenda says public comment may be limited to the items on the agenda. But it also shows the mayor making an appointment and then the business item. It\u2019s not a study session \u2014 it\u2019s a special meeting where you can take action tonight. Am I correct?<\/p>\n
Mayor Jung: I\u2019ll defer to the City Clerk, but as I see it, it says a special meeting, and she noticed it as a special meeting. By the way, we can give direction, but we can\u2019t make decisions. I\u2019ve just used all of my time on this. I\u2019m happy to give you more time; I wouldn\u2019t adjudicate this back and forth with the City Attorney.<\/p>\n
City Clerk:: Just to clarify \u2014 I understand where the confusion is. The agenda report says the City Council may limit comments to only the items described. \u201cMay limit\u201d means it\u2019s at council discretion to either allow general public comment or limit it to the agenda item.<\/p>\n
Mayor Jung: It\u2019s always council discretion, and I don\u2019t plan on limiting anybody. I\u2019m just taking public comment right now. So \u2014 are we giving general public comment, or is she talking about the trash, whatever she wishes to do? I\u2019m not going to make that decision for her.<\/p>\n
Resident (unidentified): Can we start my timer? Thank you. I ask that you keep Republic Services and award them the contract. It\u2019s not perfect \u2014 no one is, in my opinion \u2014 but I\u2019ve lived in Fullerton for 40 years, and 99% of the time they do a good job. Keeping them will be less disruptive to residents and commercial clients; any change will be disruptive by necessity.<\/p>\n
I also want to speak out against considering the upfront-money enhancements \u2014 in one case $10 million, in another $15 million \u2014 which essentially allow companies that can afford it to buy their contract with the city. This was suggested by the ad hoc fiscal sustainability committee, and companies felt the need to offer it to be competitive, which I don\u2019t think was right. Consideration should only be given to reliability, track record, and the other values staff considered \u2014 not convoluted with enhancements that have nothing to do with trash hauling.<\/p>\n
I also ask that the companies that put that money up front \u2014 offered as a loan to the city \u2014 take it back, which would allow them to make a better offer on rates. And on Valley Vista: I don\u2019t think they should have been allowed a second time through this. They didn\u2019t score high enough; the fair thing would have been that they were out of the running. Council Member Zahra kept asking what comparable cities these companies serve. Valley Vista doesn\u2019t serve a city our size \u2014 the closest was around 90,000. So I ask that you consider only the top three, and allow Republic to redo some of theirs if they take back their $10 million offer. Thank you.<\/p>\n
Mayor Jung: Next speaker.<\/p>\n
City Clerk: Francisco, then Shawna, then Julie Beretta.<\/p>\n
Francisco Miranda (resident): Hello. My name is Francisco Miranda. I\u2019m a resident of Fullerton on Sandalwood \u2014 I\u2019ve been there since 2012. I\u2019ve always had great service from the trash crews that pick up our trash. My neighbors never complained; they liked them. Even when I called in for an extra pickup or to replace a bin, the service was great. I\u2019m happy with the service, and I\u2019m here to represent our residents who are grateful for it. Your trash people are outstanding. That\u2019s all I can say. Thank you.<\/p>\n
City Clerk: Shawna, followed by Julie, and then Jeff Otter.<\/p>\n
Shawna Adam (resident): Hello, Mayor, council members, and members of the audience. My name is Shawna Adam, and I\u2019ve been a Fullerton resident over 30 years. Picking up trash isn\u2019t a sexy subject \u2014 you can see how many people signed up to talk about it. When services go out to bid, many are quick to select the least expensive option because on the surface it looks like the better deal. But one needs to do due diligence and look deeper \u2014 contrast and compare all the services provided, the costs, and the timelines.<\/p>\n
I need to make it clear I was not asked or solicited by Republic to come speak on their behalf, and I have no family members, neighbors, or friends who work for the company. I say that because I don\u2019t want anyone to think I\u2019m speaking for Republic based on someone asking me to. I\u2019m a member of the community, and I\u2019ve been very happy with them over the years. When I\u2019ve had my trash can stolen up in my neighborhood off Hermosa and Teton, Republic replaced it at no cost.<\/p>\n
Over the past six months, my friends and I have been comparing costs, pickup, and schedules. Some companies charge for replacement and for bulk pickup. Our city has unlimited bulk pickup, which is great \u2014 we need people to use it instead of dumping trash in the parks, which takes up our resources. We\u2019re not charged extra for bulk pickup, unlike other cities that charge residents on top of the roughly $60 we pay for weekly pickup \u2014 or that only offer bulk pickup twice a year, which limits who can use it. I use it, and I\u2019d like others to use it, so our city doesn\u2019t end up looking like other cities with trash sitting out on the sidelines. Thank you.<\/p>\n
City Clerk: Next, Julie from CR&R, then Jeff Otter, and then Lori Bruno.<\/p>\n
Julie Beretta (CR&R, Senior Vice President): Good evening, Mayor Jung and City Council. My name is Julie Beretta, Senior Vice President with CR&R. It\u2019s a pleasure to see you all again. First, we want to thank city staff for their hard work throughout this RFP process \u2014 it\u2019s not an easy task \u2014 and we commend the City Council for the decision at the last meeting to bring the selected firms back for a second best-and-final. It\u2019s apparent the proposals were very competitive, and whichever hauler you select, the community and ratepayers will benefit.<\/p>\n
We know you have a tough decision, so we\u2019d like to recap a few highlights. We feel CR&R provided the strongest combination of competitive rates, immediate investment, operational capability, and regulatory certainty. We\u2019re four miles from your city, with the most operating facilities in Orange County, and we serve like-sized cities \u2014 Orange, Costa Mesa, and Newport Beach. We\u2019ve guaranteed the city SB 1383 compliance, including RNG credits from the renewable natural gas produced at our anaerobic digestion plant. From our first proposal in November to this second best-and-final, our rates are fair and equitable, and we assure the city and ratepayers we will not come back in a couple of years and say we bid too low and need to raise rates. That will not happen from CR&R.<\/p>\n
Our initial proposal included a $300,000 beautification project to refurbish the city\u2019s downtown enclosures. As a follow-up to the last meeting \u2014 and as the previous speaker raised \u2014 we heard the concern about bulky-item collection for multifamily properties. One of our new enhancements is a monthly bulky-item collection program for multifamily properties during heavy move-in and move-out periods, at no additional charge, with the same per-unit item allowance as single-family homes. We also recognize our collection vehicles are large and cause wear and tear to city streets, so as part of our new enhancement we\u2019ve proposed a road-improvement contribution to help offset street repairs. We have the experience \u2014 we\u2019ve transitioned 17 cities in the last 20 years \u2014 and we\u2019d love to add Fullerton to the CR&R family. Thank you for your time and consideration.<\/p>\n
City Clerk: Jeff Otter, then Lori Bruno, then Jordan Barrera.<\/p>\n
Jeff Otter (resident, District 3; Treasurer, Craig Park East HOA): Good evening, Mayor and members of the City Council. My name is Jeffrey Otter. I\u2019m a resident of District 3 and treasurer of the Craig Park East Homeowners Association. I\u2019ve submitted a formal statement to the City Clerk and ask that it be entered into the record. I\u2019m here to address rate equity for multifamily residents under the pending services contract.<\/p>\n
Under California Proposition 218, waste fees are property-related fees and must legally be proportional to the actual cost of serving each parcel. However, because multifamily recycling and organics programs haven\u2019t launched yet, there is zero empirical data to support a formal cost-of-service analysis. Without that data, the proposed commercial bidding structure creates a massive disparity gap. Our analysis shows that under the proposed commercial schedules, identical container services cost 480% to 1,400% of single-family rates. Modeling the impact on a community like Craig Park East, multifamily residents would face waste rates 14% to 168% higher than single-family homes for the same level of service \u2014 and under the incumbent, Republic Services, our community\u2019s modeled rate would rise to 268% of the single-family rate. Because multifamily residents have the least visibility into these rate structures, they are highly vulnerable to disproportionate adjustments.<\/p>\n
To remedy these disparities before they take effect, we urge the Council to adopt a legally defensible two-step transition. First, negotiate phase-one interim rates using a two-tier commercial structure that aligns the cost per multifamily dwelling with the single-family residential rate; our submitted statement provides a revenue-neutral blueprint to achieve that parity. Second, mandate a formal, data-driven cost-of-service analysis after 24 months of active service, so that once hard operational data is collected, final rates are legally adjusted to reflect actual audited costs. You\u2019ll have your fingerprints on this agreement for the next 10 to 20 years, at a time when housing affordability is a critical concern. We cannot allow unverified rate structures to artificially inflate the cost of living for our renters and condo owners. Please adopt this interim parity strategy and ensure compliance with Proposition 218. Thank you.<\/p>\n
City Clerk: Next, Lori Bruno, Jordan Barrera, then Lucy \u2014 that\u2019s all who have signed up. If anyone else would like to speak, please work your way to the wall opposite me and we\u2019ll get you to the microphone next.<\/p>\n
Lori Bruno (resident; former Republic Services risk director): Good evening. I know we\u2019ve had a difficult couple of months, but thank you for all you do for the city of Fullerton. I\u2019m a longtime resident, a former risk director of a large waste company \u2014 Republic Services \u2014 and I was very active in the Fullerton School District. I\u2019m a diehard safety advocate. I\u2019m not running for anything; I care about kids and the safety of residents, and I watch the city like a hawk to make sure someone is looking out for safety.<\/p>\n
I just listened to a presentation from a prospective company, and not once did they mention safety. That\u2019s disappointing. I worked for Republic Services for 12 years, managing their claims, and I saw firsthand what a best-in-class operations organization looks like. I don\u2019t care which company you pick \u2014 but I want to draw attention to the fact that it\u2019s not just about pricing. I now represent 145 school districts across California, making sure kids are safe. This is a report of a fatality in the city of Placentia \u2014 a 13-year-old struck and killed as he left a crosswalk. If you don\u2019t put safety into this conversation, you\u2019re not doing your job.<\/p>\n
Whatever you decide is up to you, but it\u2019s about who manages the contract \u2014 checking their safety record, making sure they know how to handle lithium batteries and fires. Four miles is great; Republic is less than two miles away. I\u2019m not telling you to pick anyone. But if you want safety in your city, make sure whoever is managing this understands safety. If that\u2019s you, I\u2019d love to spend an hour helping you audit a hauler\u2019s safety records and make sure your transition plan is solid \u2014 for safety, not just pricing. Safety is not funny. I\u2019ve seen the brain of a child on the back of a wheel. So whoever comes up here talking about waste collection, I hope safety is part of it. Thank you.<\/p>\n
City Clerk: Jordan, followed by Lucy, and then those who aren\u2019t registered.<\/p>\n
Jordan Barrera (Higher Ground Youth and Family Services): Good evening. My name is Jordan Barrera. I\u2019ve had the pleasure of meeting several of you. I work for a nonprofit called Higher Ground Youth and Family Services, which has been in Anaheim and now in Fullerton. I wanted to share our experience \u2014 and mostly my own \u2014 with Republic Services. They\u2019ve shown up for our families in so many ways. I started in the program as a mom, years before I worked there, and I\u2019ve seen firsthand how Republic looks for creative ways to serve the community and make a lasting impact.<\/p>\n
When any city partners with a service agency, it should go beyond the transactional \u2014 beyond \u201cthis is what we can do for you\u201d \u2014 to \u201chow do we work together to make the community better.\u201d That\u2019s been a core part of what they do. I\u2019ve witnessed it with us, and I volunteer and serve on committees for other nonprofits where I\u2019ve seen them do the same. It\u2019s consistent, it\u2019s caring, and it comes from the heart. I think that\u2019s a core component when you\u2019re deciding who to bring into your community. Please truly consider the impact beyond just the service they provide. Thank you.<\/p>\n
City Clerk: Our last registered speaker is Lucy, and then we\u2019ll get to the folks lined up. So far, no remote comments.<\/p>\n
Lucy (resident): Good evening. My name is Lucy. I came because someone mentioned this meeting. Usually the meetings are later so the community can come, because people work. Moving the meetings earlier makes it more difficult for residents to attend.<\/p>\n
I heard you\u2019re changing the trash contract, and I just hope you don\u2019t raise prices. I heard the ladies speaking on behalf of the company that wants to come in instead of the current one, talking about how their trucks are bigger and will wear on the streets. She said they\u2019ll provide money for the streets \u2014 but I\u2019ve been here 30 years and I\u2019ve seen hardly any improvement to the streets. We keep building homes and multifamily housing, but streets are a lower priority. Now we\u2019re bringing in even bigger trucks, and I\u2019m pretty sure it\u2019s going to be more expensive.<\/p>\n
I hope your priorities are set straight \u2014 we have very poor lighting and horrible streets. And I hope that next time you make it easier for residents to attend. Everything feels last-minute, and that\u2019s not fair. I\u2019m not working right now, so I can come \u2014 but most residents I know work, and it\u2019s difficult for them. It\u2019s not enough to thank people for coming; you have to make it easier for residents to be here. Thank you.<\/p>\n
Helen Higgins (resident, District 2): Good evening. Can you hear me? Helen Higgins, District 2. As the previous speaker said, cheaper isn\u2019t necessarily better. I appreciate Republic Services \u2014 I\u2019ve found no fault with their service. I\u2019m here primarily to raise a point nobody has mentioned: Republic Services uses union workers. As a former resident of Detroit, I know what unions mean. According to a rate-comparison table I reviewed this afternoon, neither of the two cheaper services is a union shop. After this primary election season and heading into November, I\u2019d hope you\u2019d pay very close attention to that aspect of whatever choice you make. Thank you.<\/p>\n
Karen Lloreda (resident, District 2): Karen Loretta, District 2. This is a 20-year contract. We, the residents of Fullerton, have to live with the consequences of your decision. This directly impacts our lives every week. This isn\u2019t about the five of you or the three of you \u2014 it\u2019s about the people on the other side of the dais. We\u2019re the ones who will pay the price. So please, no more shaky deals that benefit friends or donors, no more risky outcomes. Let\u2019s go for the tried and true \u2014 stable, long-term, reliable service.<\/p>\n
I urge you to be conservative tonight. The evaluation committee \u2014 five staff from relevant departments \u2014 ranked all applicants and recommended the top three: EDCO, CR&R, and Universal. Mayor Jung and Councilwoman Valencia decided to add three more. Staff used objective criteria; don\u2019t second-guess them. We want good, dependable service at reasonable rates for the next 20 years. Don\u2019t try to salvage a reputation or dig us out of a hole with a risky quick fix \u2014 we\u2019ve seen what it\u2019s like to live with prior councils\u2019 poor decisions.<\/p>\n
My personal preference is CR&R: they\u2019re Orange County\u2013based, have a proven record of service and community participation, their enhancement package is the most complete of the six, and they\u2019re offering a $4 million road-improvement investment. Valley Vista\u2019s customer reviews are terrible \u2014 you really ought to read them \u2014 and Athens is based out of LA and serves mostly LA cities. Residents aren\u2019t council members, but many of us research, discuss, and compare options in depth \u2014 more than some council members do. Please take our comments seriously. Take the prudent path. Thank you.<\/p>\n
City Clerk: That looks like our last speaker in chambers. We\u2019ll move to Zoom \u2014 we have one hand raised.<\/p>\n
Jane Ramirez (resident, District 5; via Zoom): My name is Jane Ramirez. I live in District 5. Mayor Jung and Council, I\u2019m glad to be here. My biggest concern is that some real basics need to be assured \u2014 such as trucks that don\u2019t leak green goo, red globs, and other fluids on our streets and alleys, which I\u2019ve been seeing regularly. Don\u2019t fault the drivers; they\u2019re good people. I\u2019ve seen one scrambling with rags he clearly brought from home \u2014 old T-shirts \u2014 trying to wrap leaking hydraulic lines. I know equipment is a huge investment, but these are basic standards we should expect: reliable pickup and reliable communication.<\/p>\n
It would also help residents if billing didn\u2019t have to go through the city \u2014 right now we have no way to communicate with the current hauler except by phone, and sometimes you reach people in places like Missouri who have different pickup standards and give wrong information. I don\u2019t know how to capture this in a proposal, but cleanliness matters: always having a cleanup kit on every truck, so when garbage is dumped \u2014 sometimes because residents put junk in their trash \u2014 the crew cleans up after themselves or sends someone to. Regardless of who you select, these basics are very important, and if it means a dollar or two more a month to get them right, I\u2019m okay with that. Thank you.<\/p>\n
Resident (former Teamster, District 4): Good afternoon, elected City Council members, department heads, and staff. I became familiar with Fullerton when I relocated here in 1978. I\u2019m a former Teamster from when I worked at UPS. I don\u2019t know all the proposals the committee looked at, but most of these people seem to be here representing themselves.<\/p>\n
What I know about the current company, Republic: Jamie Valencia is my representative in District 4, and our trash is picked up on Fridays \u2014 yet consistently, one or more of my three cans (green waste, recycling, garbage) isn\u2019t picked up until Saturday, sometimes Saturday afternoon. As a former union member, I can\u2019t figure out why someone would come to work on a Saturday when their job is Monday through Friday. I\u2019ve asked direct questions of four Republic union members, and they lied to me. That\u2019s not the way to represent the company.<\/p>\n
I\u2019m also on the investment advisory committee, and we recently changed our long-term financial advisor, because sometimes it\u2019s good to change to another company. As for safety \u2014 you come up here and talk about safety, but you still don\u2019t have sidewalks for 5-to-12-year-olds walking to Orange Sur Elementary. You can talk all you want, but I haven\u2019t seen action. Until I see a sidewalk or a curb on even one side of that street, I won\u2019t believe anyone who says they\u2019re for safety while making children walk in the street year after year, where cars travel at high speeds. Even at the speed limit, if you get hit you\u2019d better hope you have a helmet on. Go Lancers, Go Hornets, Go Titans, Go Cougars. God bless you all.<\/p>\n
Elijah Manissero (resident): Good evening, Council. Elijah Manisero. First, I think we should stick with a union hauler \u2014 not necessarily because unions are better, but because if we don\u2019t go with Republic, a lot of Fullerton residents may be out of a job, and a union hauler is more likely to absorb those workers and prevent that economic shock.<\/p>\n
Of the current offers, CR&R has the best \u2014 head and shoulders above the rest. They offer the lowest residential rate among union haulers, the second-lowest commercial rate among all offers, $4 million to help fix our roads, and they serve more Orange County cities than any of the other haulers. They deserve serious consideration. That said, I think we should give the incumbent, Republic, a chance to revise its offer. I have no issue with Republic, but on safety \u2014 one of their trucks was on fire two weeks ago, and they have a very old fleet \u2014 there are things they need to address.<\/p>\n
If we do go with Republic, I\u2019d suggest three changes. One, lower their commercial rate to something more competitive; it\u2019s far higher than any other offer, and if that means scaling back other benefits, so be it. Two, write strong SB 1383 compliance into the contract, and put that burden on the hauler rather than ourselves. Three, drop the lump sum of cash, which just increases rates on residents. That idea was suggested in the fiscal committee by Tony Bushala; it was a bad idea then and it\u2019s a bad idea now. We have an annual structural deficit \u2014 a lump sum of cash doesn\u2019t solve that. Don\u2019t put a hidden tax on residents. So I think we should go with CR&R, or Republic if they make those three changes. Thank you.<\/p>\n
Vince Buck (resident): My name is Vince Buck, and I didn\u2019t expect to speak today. This has been a strange process \u2014 the staff recommendations, then a subcommittee of two members without representing the rest of the council. I think the staff recommendation should be taken seriously.<\/p>\n
But that\u2019s not what I want to talk about. I have needs different from other people \u2014 I\u2019m disabled, and I have one of the steepest driveways in town, short but steep. I have difficulty even getting up to my mailbox, and there\u2019s no way I can take the garbage cans out. Republic comes down and takes my cans every week. Occasionally I miss a can, but if I call, someone comes out the next day to take care of it. They\u2019ve been very good at providing for my needs, and I\u2019d hate to switch to a company that wouldn\u2019t be as reliable.<\/p>\n
The one thing I\u2019m not happy with is that they sit in front of my house a little longer than at other houses, and one of their trucks drips oil, so I have big oil spots in front of my house. I\u2019m hoping the city repaves that street soon. Thank you.<\/p>\n
City Clerk: We have one hand raised on Zoom \u2014 Alexia, you should be able to unmute.<\/p>\n
Alexia (Park Ridge Condominiums board member; via Zoom): Thank you for allowing me to speak. I\u2019m a board member at Park Ridge Condominiums, right across from Craig Park on Imperial Highway and Associated Road. Thank you to Jeff from one of the neighboring condos for letting us know about this.<\/p>\n
As a condo association, all of our trash is picked up \u2014 I believe by Republic \u2014 and I\u2019ve had no problems in the 10 years I\u2019ve been there. But hearing that you want to sign a 20-year contract, I\u2019d caution and ask you to reconsider. Per the state of California, an HOA isn\u2019t allowed to sign a contract longer than one year, but we can do an automatic renewal with review. I\u2019d recommend a one-year contract with an automatic renewal up to five years \u2014 that gives you time to gather data on whether it\u2019s working for you, the city, and the community.<\/p>\n
We have a very diverse community \u2014 mobile homes, HOAs, condos, townhomes, and single-family homes. For us, our landscapers take away all landscaping waste, and anyone doing repairs isn\u2019t allowed to use our trash areas; we pay a separate company for that. So the trash company is really just picking up trash. Please keep that in mind when looking at overall cost \u2014 there\u2019s a difference between townhomes, home associations, and single-family homes.<\/p>\n
I\u2019m also not a big proponent of quid pro quos \u2014 \u201cyou give me this, we\u2019ll give you $4 million for roads.\u201d We\u2019re all living in hard times and stretching our budgets, but we also want the best customer service. At 136 units, we\u2019re a condo association, not single-family homes, and we only do trash. Please don\u2019t sign a 20-year contract; you want a clause that lets you get out. Thank you again to Jeff Otter for letting other associations know. That\u2019s all in my three minutes.<\/p>\n
Mayor Jung: Thank you, everybody, for those comments.<\/p>\n
Appointment \u2014 Parks & Recreation Commission<\/p>\n
Mayor Jung: We do have an appointment this evening. Parks and Recreation told me that because of my lack of an appointment, they don\u2019t have a quorum. So I\u2019ll appoint Dan Kim this evening. I\u2019ll make that motion.<\/p>\n
Council Member: Second.<\/p>\n
Mayor Jung: Madam Clerk, please call the roll.<\/p>\n
City Clerk: Council Member Charles \u2014 aye. Council Member Valencia \u2014 aye. Council Member Zahra \u2014 aye. Mayor Pro Tem Dunlap \u2014 aye. Mayor Jung \u2014 aye. The item passes.<\/p>\n
Business Item \u2014 Solid Waste Management Services RFP Evaluation<\/p>\n
Mayor Jung: We\u2019ll go to the regular business item \u2014 our Solid Waste Management Services RFP evaluation. I don\u2019t expect council to make a decision this evening. Let\u2019s have our Solid Waste and Recycling Specialist, Ms.\u00a0Michelle Durant, make the presentation.<\/p>\n
Michelle Durant (Solid Waste & Recycling Specialist): Good evening, Mayor, Mayor Pro Tem, and council members. The purpose of this evaluation meeting is to obtain direction from Council on the next phase of the RFP process, maintain progress on finalizing service-agreement terms and preparing for contract award, and remain compliant with CalRecycle\u2019s Corrective Action Plan (CAP) deadline.<\/p>\n
As a reminder, the city received a final CAP extension until June 30, 2027, contingent on completing an RFP process that complies with SB 1383. Staff received a letter from the state identifying a missed April 2026 contract-negotiation milestone and expressing concern about our ultimate final deadline of July 1, 2027, for SB 1383 rollout compliance. The state wants to meet with staff after this meeting to see the outcome of tonight\u2019s council meeting. If they feel their concerns are large enough that we won\u2019t meet the July 1, 2027 deadline, they could cancel the CAP extension and put us into a compliance-review audit within the year. If we\u2019re still not in compliance with our collection-service program, it could lead to notices of violation, and continued delay could result in penalties ranging from $500 to $10,000 per violation per day \u2014 dating back to January 1, 2022, the law\u2019s initial implementation date. So we ask Council to consider this closely as we continue with the RFP timeline.<\/p>\n
For an RFP status overview: at our April 14, 2026 study session, staff brought forward the evaluation of the nine initial proposals, the evaluation committee\u2019s scores, and the ad hoc committee\u2019s additional recommendations. Tonight, June 30, we\u2019re continuing that discussion. At the April 14 meeting, City Council directed staff to advance six firms: Athens Services, CR&R Environmental Services, EDCO Disposal, Republic Services, Universal Waste Systems, and Valley Vista Services \u2014 the three recommended by the evaluation committee and the three recommended by the ad hoc committee. These shortlisted firms submitted final-offer proposals on May 5, 2026.<\/p>\n
Staff reviewed the six final offers and prepared a comparative summary. Some firms strengthened their proposals; others had strong initial proposals and made targeted refinements. The comparison covers pricing, comparable cities (raised at the last meeting), union workforce, and key enhancements and community benefits. This slide shows our revised RFP process and timeline, built to allow sufficient time for Council review and public engagement. We\u2019re now at the final evaluation stage, with a few remaining activities still to be scheduled.<\/p>\n
I want to highlight a few notable RFP elements. First, this new contract includes a full suite of container-size options for commercial and multifamily customers. Our current contract allows multifamily customers only bin service; the new contract could allow different bin sizes or split containers, which matters because we\u2019re adding recycling and organics service that many commercial customers don\u2019t currently have. Every property is unique, and we want them right-sized to their waste generation.<\/p>\n
Second, we\u2019ll have a hot-spot collection service. We\u2019ve identified illegal-dumping hot spots noted by our field crews; this is a flexible service, so as one area improves and another worsens, crews will do weekly sweeps and schedule removals. Relatedly, our current contract has weekly unlimited bulky-item collection; the new contract changed that to quarterly \u2014 partly because we now have the hot-spot service, and partly because we\u2019ve added community benefits such as household hazardous waste collection events, paper-shredding events, and continued compost giveaways. These were all requested by the community over the years. Keeping unlimited bulky pickup plus all these extra benefits comes at a higher price tag, so we tried to offer a balanced, varied service like neighboring cities.<\/p>\n
There are also important deliberation priorities for Council. One is workforce reliability \u2014 minimizing the risk of labor stoppages. We\u2019ve had a couple of labor stoppages under the current contract, and there could be another, since labor negotiations are coming up within the year. Another is compliance and regulatory alignment. Our current contract references AB 341 (recycling) and AB 1826 (organics), and we are not compliant in those areas. Our overall diversion rate is 15.81%, largely because we haven\u2019t fully rolled out recycling and organics. Our AB 341 compliance is 25.1% for businesses and only 4.8% for multifamily; our AB 1826 compliance is 6.6% for businesses and 1.5% for multifamily. With the new SB 1383 penalties and stronger enforcement, we want to ensure whoever is selected guarantees compliance under the new contract.<\/p>\n
This is a significant compliance shift, which underscores the importance of the transition plan. We urge careful consideration before implementing expanded programs that require resident or business participation without first providing the time, resources, and education to ensure success. This is a poignant time for Fullerton \u2014 we\u2019re rolling out recycling and organics in many ways for the first time \u2014 and we want to ensure the community understands how to sort properly so they don\u2019t incur contamination or overage fees. Simply dropping off a cart is not the solution; we have to make sure people know how to use it. Regardless of the selected proposal, all proposers will be required to undertake the same transition steps. We have legacy issues \u2014 incomplete or inaccurate customer data \u2014 so we\u2019ll need a full sweep of customer accounts, a service-level assessment to right-size service, equipment purchases (new vehicles and SB 1383\u2013compliant containers), a full education and outreach campaign, and a citywide service rollout.<\/p>\n
Tonight\u2019s proposed motion is for Council to direct staff on which firm or firms to proceed with in negotiations, finalize service-agreement terms, and prepare for contract award. Council has been provided all the materials. I\u2019m here with our solid waste consultant and our solid waste special counsel for any questions.<\/p>\n
Mayor Jung: Thank you. For me, waste and recycling franchises rarely go out to bid \u2014 this city\u2019s hauling contract has historically been evergreen \u2014 so this is a once-in-a-generation opportunity to improve the service. I\u2019m pleased we received robust responses to our RFP. I want to thank every company that made a proposal, and acknowledge our staff and consultant for handling this complex issue professionally, and for giving Council and the public time to digest it. This is our opportunity to do what\u2019s best for Fullerton residents and businesses. I look forward to hearing from my colleagues. Who wants to start?<\/p>\n
Council Questions<\/p>\n
Council Member Zahra: Thank you, and thank you to everyone who worked on this and to the applicants for indulging us with these additional bids. I do have some questions. First, I wish we\u2019d scheduled this differently and given the public better notice \u2014 this is an issue that affects everyone, not just five people, and not just now but for the next generation.<\/p>\n
I\u2019m confused about the upfront payments; the staff report is a bit convoluted. I\u2019d like an explanation of these two fund advances \u2014 the $15 million and the $10 million \u2014 because the way I\u2019m reading it is concerning. How does this translate into actual numbers and costs for residents?<\/p>\n
Michelle Durant: We\u2019ll call up our solid waste consultant, Mike Vallier, who analyzed the upfront payments.<\/p>\n
Mike Valley (Solid Waste Consultant): Good evening. I\u2019ve done a detailed analysis and report on the upfront payments and how they\u2019d be paid back; that detailed report isn\u2019t in your packet, though there\u2019s summary information that is. This is a difficult decision. I\u2019ve dealt with many contracts and hauler proposals and know most of the firms proposing. Specific to this issue \u2014 the City Attorney can address the rate questions \u2014 but from what I\u2019m seeing, it\u2019s essentially an offer tied to a different CPI schedule that would historically increase rates faster than the CPI schedule the city selected and put in its sample contract to protect ratepayers.<\/p>\n
Council Member Zahra: Thank you. What I\u2019m trying to do is translate it into actual numbers so laypeople can understand it. You said it could increase costs at a faster pace?<\/p>\n
Mike Valley: We can\u2019t predict what the schedules will do, but over the past 10 years our schedule ran at 3.48%. One proposer advancing money like that is at 4.1%, and the other \u2014 the one put forward by Republic \u2014 is at 4.15%.<\/p>\n
Council Member Zahra: Has this ever been done before?<\/p>\n
Mike Valley: It was fairly common historically \u2014 not so much anymore; today it would be more unusual than five or ten years ago. Over a 20-year term \u2014 and while the contract is for 10 years, one firm asked for 20 \u2014 rates go up close to 100% for everybody, but the two firms with the different CPI schedule go up 10% to 20% more over that term. There\u2019s a correlation. It\u2019s like a dividend stock: raise the base a little more early, and you get a raise upon a raise. It\u2019s a rate challenge.<\/p>\n
Council Member Zahra: In layman\u2019s terms, am I correct to characterize this as taking a cash advance against future billing of our residents?<\/p>\n
Mike Valley That\u2019s really a City Attorney question \u2014 above my pay grade \u2014 but that\u2019s how I read it, too. It\u2019s an upfront payment.<\/p>\n
Attorney Patrick Mu\u00f1oz (Special Counsel, Solid Waste): Good evening, Council. Patrick Munoz, the Mayor\u2019s special counsel on solid waste issues. From a pure legal standpoint, I wouldn\u2019t characterize it that way. All trash contracts have a variety of loosely called franchise fees \u2014 revenue that comes to the city based on the gross receipts of the contract. The city asked for a specific percentage. There\u2019s evolving law here, and a lot of talk about Proposition 218 and franchise fees. What you\u2019re really looking at is haulers offering a different franchise-fee percentage than what you asked for, and willing to pay it up front to entice you. The legal analysis is whether it reasonably reflects the value of the franchise \u2014 a complex issue the courts are still struggling with. My job is to make sure that whoever you go with, we\u2019ve done an analysis tying those points together. When you\u2019re ready to decide, we\u2019ll present an analysis on how to break that out.<\/p>\n
Council Member Zahra: Could you speak a little louder, please? Who is paying this?<\/p>\n
Patrick Mu\u00f1oz: The haulers are paying it.<\/p>\n
Council Member Zahra: But who is ultimately being billed for it?<\/p>\n
Patrick Mu\u00f1oz: The haulers are paying it. The best empirical way to demonstrate that is that a hauler offering you upfront cash lowered the rates they offered initially. They may make that money back, or they may not \u2014 legally, they\u2019re taking these funds out of profits they otherwise would have made.<\/p>\n
Council Member Zahra: Just to clarify \u2014 you\u2019re our City Attorney, correct?<\/p>\n
Patrick Mu\u00f1oz: Special counsel, yes.<\/p>\n
Council Member Zahra: It says here there\u2019s a recovery of the $10 million payment \u2014 so they are making the money back. Can I speak to whoever put this analysis together? I\u2019m getting legalese, but I\u2019m not getting answers, and I feel like you\u2019re defending this rather than explaining it. I\u2019m frustrated because I\u2019m trying to explain to the public how this translates to actual costs for residents. I don\u2019t care what they\u2019re offering \u2014 I want to know the real cost, because this idea was generated by one individual, not by council directive. So how it came about is also a concern. This seems to be about appeasing a political structure rather than translating to real value. I see money up front that residents will end up paying for over time.<\/p>\n
Patrick Mu\u00f1oz: I apologize if it\u2019s coming across that way. I can give you the legal framework, but I\u2019m not in a position to comment on the political aspects.<\/p>\n
Council Member Zahra: Please, someone explain these charts. They\u2019re extremely convoluted \u2014 the numbers keep going up, and our consultant says it\u2019s exponential.<\/p>\n
Mike Valley: Let me answer bluntly. The numbers on the board show what happens to rates under the proposals \u2014 and with the additional $10 million and $15 million, no question they\u2019re higher. The table you\u2019re referring to was a preliminary assessment I put in a broader memo to my client \u2014 my opinion, not necessarily the review committee\u2019s. I was concerned about it. As Attorney Munoz said, I don\u2019t know the legal cause-and-effect \u2014 it appears there\u2019s money up front and then a higher rate increase, but I can\u2019t confirm a legal tie. That\u2019s why I created the table for staff: to flag it as an area of concern. Beyond that, I\u2019m not qualified to comment. I think that addresses the heart of your question.<\/p>\n
Council Member Zahra: I don\u2019t think these offers actually helped EDCO or Republic \u2014 they\u2019ve just increased their own cost; it\u2019s like they\u2019re outbidding themselves. We\u2019re trying to hire a trash hauler to keep our neighborhoods clean, not to clean up the city\u2019s financial messes. This is uncharted territory, and to me it needs to be off the books. The person who suggested this even has a blog where he himself calls it a hidden tax. I don\u2019t understand why we\u2019d divert our discussion from getting the best rate for residents into packaging something to get cash up front.<\/p>\n
And if we did get this cash \u2014 do we have any mechanisms or protections on how the city would use it?<\/p>\n
City Attorney \/ City Manager: There are no protections built into their proposals. If Council chose one with an upfront lump sum, you\u2019d have to give us direction on how to apply that money. Right now there\u2019s no plan for it.<\/p>\n
Council Member Zahra: We just came out of an audit that showed we have no protection mechanisms in place \u2014 we had a $10 million misallocation \u2014 and now we\u2019d ask for more money without even knowing what we\u2019d use it for. It seems odd. Mr.\u00a0Munoz, if we went down this path, we\u2019d have to negotiate those guarantees and projections into the contract, right? With CR&R it was very clear \u2014 their offer was for roads, and that would be in the contract. The others are just cash; I don\u2019t know what that is.<\/p>\n
I also want to know: if a hauler other than Republic is selected, have the other union or non-union haulers guaranteed they\u2019d become union or absorb employees? We have many Republic employees living in Fullerton, so we\u2019d basically be putting them out of a job.<\/p>\n
Michelle Durant: Council Member Zahra, only two firms have non-union workforces, but all firms have confirmed that if Republic isn\u2019t selected, they\u2019d offer employment to all of Republic\u2019s employees and absorb that workforce. So no one would lose their job.<\/p>\n
Council Member Zahra: But the non-union firms can\u2019t take union workers, can they?<\/p>\n
Michelle Durant: They\u2019ve committed to offer jobs.<\/p>\n
Council Member Zahra: And on the fleet \u2014 cleanliness of trucks came up. Is an upgraded fleet part of the negotiation?<\/p>\n
Michelle Durant: Yes, newer or new vehicles are a requirement of the RFP and the agreement. Republic Services is the only firm that hasn\u2019t agreed to the full terms; they\u2019d provide 11 new vehicles up front and phase in the rest over five years. All the other firms confirmed they can begin with newer or new trucks.<\/p>\n
Council Member Zahra: On SB 1383 \u2014 not everyone guarantees a deal on procurement assistance. For example, EDCO offers guaranteed procurement credits; are others not offering that? These tables would have been more helpful categorized by service.<\/p>\n
Michelle Durant: All firms offered SB 1383 procurement assistance. Some already have anaerobic digestion facilities that process organic waste into renewable natural gas, which generates SB 1383 procurement credits; some offer unlimited compost usage; Valley Vista offered assistance toward that. Different firms offer varied assistance \u2014 and that includes Republic.<\/p>\n
Council Member Zahra: One reason for putting this out to bid, per the staff report, was that Republic wasn\u2019t negotiating properly on SB 1383. If a new contract guarantees a deal on this, why haven\u2019t we already reached that with them?<\/p>\n
Michelle Durant: That was one of my deliberation considerations \u2014 ensuring the compliance language is actually adhered to. Negotiations on amendments began about four years ago, with staff turnover on both sides. HFH Consultants set the parameters, and we actually reached an agreement in February 2024 and were ready to move forward with an amendment \u2014 plus a separate Amendment 5 for our multifamily legacy issues \u2014 so we could at least get SB 1383 compliance. But when we were ready to finalize, we received a different package from the incumbent that included an inflation cost that wasn\u2019t agreed upon, with no backup documentation. That stalled negotiations. Now that we have dedicated staff in Public Works, we\u2019d ensure the contract requirements are managed and met.<\/p>\n
Council Member Zahra: Our lack of SB 1383 compliance is with the state. Republic is under contract with us until 2027 \u2014 why haven\u2019t we continued negotiating with them?<\/p>\n
Michelle Durant: We attempted many times over four years, including with our current consultant, City Green Consulting, before rolling out the RFP. But because of the delays, our CalRecycle CAP would only be extended if we entered an RFP process. So the state gave us a deadline: if you don\u2019t conclude successful negotiations with Republic and want an extension, you must move forward with an RFP.<\/p>\n
Council Member Zahra: So a new contract with these provisions is basically the solution?<\/p>\n
Michelle Durant: That\u2019s correct. And it\u2019s important to note that we\u2019re the only city that received such a lengthy extension, because our contract term was ending and we\u2019d been compliant with all other aspects of the law. The state saw the city\u2019s good-faith effort. Most caps have concluded, so this extension is not something to take lightly.<\/p>\n
Council Member Zahra: Two more things. On bulky-item pickup \u2014 I raised this last time, and many residents have reached out and spoken tonight. It\u2019s a very important service, and one of the best features Republic offers. How can we ensure it continues with the other applicants?<\/p>\n
Michelle Durant: I created a slide showing which final offers included bulky-item collection beyond the quarterly service in the new contract. Athens now offers weekly unlimited residential bulky-item collection. CR&R added monthly multifamily bulky-item collection on top of the quarterly service, timed for heavy move-in\/move-out periods. EDCO included quarterly multifamily bulky-item collection, not just residential. And Republic offered unlimited weekly single-family and multifamily bulky-item collection. If Council wants to keep unlimited weekly collection, that\u2019s something we can discuss with whichever firm is selected \u2014 just let us know it\u2019s a negotiation priority.<\/p>\n
Council Member Zahra: Our community has made it very clear we want the unlimited service. When we enter a new contract, we should be building on services, not reducing them. Nobody times when they move out, and when someone buys a new fridge, the old one can sit out for 15 days waiting for the beginning of the month. That\u2019s crucial. And the hot-spot service is separate \u2014 that\u2019s about illegal dumping, a rover that roams alleys and hot spots.<\/p>\n
Michelle Durant: Correct \u2014 the hot spots relate to illegal dumping. On bulky items, one of tonight\u2019s goals is to collect Council\u2019s priorities for negotiations. I understand you\u2019ve expressed the community\u2019s desire for unlimited, but we really need a consensus of Council to move that forward.<\/p>\n
Council Member Zahra: My last question \u2014 could you explain the contract length again, 10 versus 20 years?<\/p>\n
Michelle Durant: Our new contract proposal is a 10-year term with two additional five-year extensions, based on an audit and performance level. If the city and community are satisfied, Council can deliberate whether to extend an additional five years, and then five years again. Only one firm requested a 20-year term \u2014 EDCO, based on their $15 million upfront payment. But it\u2019s a 10-year term with two performance-based five-year extensions.<\/p>\n
Council Member Zahra: I don\u2019t have more questions, but I\u2019d like to hold off on my comments \u2014 we\u2019ll come back.<\/p>\n
Mayor Jung: Councilwoman, any questions first, then comments?<\/p>\n
Council Member Valencia: Just a couple of clarifying questions. We went into the RFP, and you were negotiating with the current hauler even during the RFP. Can you still negotiate with our current hauler on the SB 1383 amendment?<\/p>\n
Michelle Durant: No \u2014 the Corrective Action Plan has moved on; it\u2019s now an RFP-based CAP. We have to have an SB 1383\u2013compliant contract.<\/p>\n
Council Member Valencia: But you were negotiating with Republic before this, to amend to an SB 1383 contract?<\/p>\n
Michelle Durant: Yes.<\/p>\n
Council Member Valencia: Okay, that\u2019s all for now.<\/p>\n
Mayor Jung: Council Member Charles, go ahead.<\/p>\n
Council Member Charles: Thank you. Following up on what Council Member Zahra was discussing \u2014 the difference between single-family and multifamily bulky collection is something I\u2019ve paid a lot of attention to. I understand it\u2019s important for people to schedule a pickup any time, but I appreciate the idea of a scheduled monthly pickup so people know when it\u2019s happening in these larger communities, and to give relief if something builds up. Can those two things exist together?<\/p>\n
Michelle Durant: We can definitely note it as a negotiation priority and bring it to the table when finalizing contract terms. In a multifamily situation it helps for people to know a collection happens on, say, the 25th of the month, and plan around it.<\/p>\n
Council Member Charles: The other thing I\u2019m concerned about is street sweeping \u2014 there\u2019s a difference across proposals. Do you have a slide like the bulky-item one showing street sweeping?<\/p>\n
Michelle Durant: I don\u2019t have one prepared, but most firms included it in their proposals. Valley Vista is offering no-cost street sweeping once our current street-sweeping contract with the vendor is finalized. Universal Waste Systems offered street sweeping with an additional 1.75% rate increase. Right now, street sweeping is done by a completely different vendor on a separate contract.<\/p>\n
Council Member Charles: When is that contract up, and should we take it into account here?<\/p>\n
Michelle Durant: We just extended our current contract with SCA for a year, so it should line up with this contract if we want it to.<\/p>\n
Council Member Charles: Do all the companies have street-sweeping capability, or just the ones that mentioned it?<\/p>\n
Michelle Durant: Two haulers have in-house street-sweeping \u2014 I believe Athens and one other; the others that proposed it would likely have to contract it out. CR&R offered it earlier, but in their final offer they chose to reduce rates instead. Let me bring up our consultant.<\/p>\n
Mike Valley: Those two things intersecting could be more complex, because residents already pay for litter abatement and street sweeping within the new agreement. So \u201cfree\u201d street sweeping isn\u2019t necessarily great \u2014 you\u2019re already collecting money for it, and you may have to amend those fees. You\u2019re much better off keeping the money in the city\u2019s hands to hire and control that vendor, rather than routing it through a hauler that may subcontract it out. If a firm offers free street sweeping, maybe you negotiate that to help with rates \u2014 but you\u2019re covered through a fee for street sweeping regardless.<\/p>\n
Council Member Charles: Looking at the downtown improvements \u2014 CR&R\u2019s $300,000 beautification, EDCO\u2019s new facility, another company wanting offices on Harbor \u2014 in staff\u2019s opinion, what would be most positively impactful for downtown?<\/p>\n
Michelle Durant: A dedicated city office, which several firms proposed, would be a great benefit \u2014 especially in the downtown Harbor area \u2014 because residents could come in to ask about their bill, missed pickups, and so on, instead of just a customer-service line. Also, our new contract already requires that within 10 feet of downtown enclosures, any uncontained waste on the ground be picked up, with weekly power washing and cleanings. Athens proposed a mini-sweeper and a porter downtown. CR&R\u2019s $300,000 for capital improvements to those enclosures is separate from the base-contract requirement to power-wash the downtown enclosures, which happens regardless of who you pick.<\/p>\n
Council Member Charles: I\u2019ll say I\u2019m always strongly pro-union \u2014 the city has unions representing every one of our other units, including police and fire, and I think we need to stick with that. If we went with a non-union firm, do you see any impacts?<\/p>\n
City Manager Eddie Manfro: It wouldn\u2019t have any impact on our internal labor relations with our own employees \u2014 that\u2019s completely separate.<\/p>\n
Council Member Charles: My related question is: if a non-union hauler got the contract and agreed to hire the former Republic employees, would that be in a unionized or non-unionized environment?<\/p>\n
Michelle Durant: From the proposals, that seemed to be very much non-unionized. One impact of a non-union firm is that we wouldn\u2019t have the labor-stoppage issue. The two non-union firms did offer to hire on the workforce, but likely not in a union environment.<\/p>\n
Council Member Charles: As someone who\u2019s been a public-university employee for about 25 years, I once took a non-union job that promoted me with better pay \u2014 and it was the worst protection I ever had. My salary later got cut to 60%, which is how I ended up coming back to Cal State Fullerton. Even if you get a base bump in pay, you don\u2019t have protections later. So I\u2019d be very strongly pro-union.<\/p>\n
Mayor Jung: Mr.\u00a0Mayor Pro Tem, anything to add?<\/p>\n
Mayor Pro Tem Dunlap: A few questions. I want to go back to the upfront-money issue, because to Council Member Zahra\u2019s point, there are three different offers here. I take a different view: two of them are essentially an illegal tax \u2014 high-interest loans that the city or ratepayers are financing over the long term, whatever they\u2019re called. The flip side is that upfront money without those strings isn\u2019t necessarily bad \u2014 in the case of CR&R\u2019s upfront money for roads, I think that\u2019s a great strategy on their part.<\/p>\n
I wanted to find out: was there any direction from staff to the applicants on terms, or did the haulers come up with the amounts and terms on their own?<\/p>\n
Michelle Durant: This wasn\u2019t directed by staff \u2014 it\u2019s whatever they proposed. They had a best-and-final and then a second best-and-final after the interviews; it was a very competitive process. They had to resubmit the same pricing form, but anything they proposed is their own.<\/p>\n
Mayor Pro Tem Dunlap: For our City Attorney or Mr.\u00a0Munoz \u2014 can you address the similarities between these potential agreements and the Oakland case, Zolly v. Oakland? As I read it, this seems like a clear-cut case for a resident to align with Howard Jarvis taxpayers and sue the city, and we\u2019d be in a tough spot.<\/p>\n
Patrick Mu\u00f1oz: I won\u2019t pretend it\u2019s not an issue \u2014 it\u2019s the hot topic. The question is whether there\u2019s a way for this to occur where it\u2019s not a hidden tax. That\u2019s what the Zolly court said you can\u2019t do, and the analysis is whether it reasonably reflects the value of the franchise, which is a difficult analysis. We didn\u2019t suggest this. And Council Member \u2014 you said earlier you thought I was defending it; I\u2019m not defending it either way. My job is to give you objective legal advice without bias toward any proposal. If you\u2019re interested in one of these proposals, I can figure out whether I can come back and tell you it\u2019s lawful. The Zolly court identified examples of things that are a hidden tax and things that are not; that case went back to the Court of Appeal and settled, so we don\u2019t have a definitive answer. It\u2019s a very complicated area of law.<\/p>\n
City Attorney Richard Jones: Let me add \u2014 if we go down this path with the money, we need assurances from Council that we can legally defend that position. Mr.\u00a0Munoz would have to present an appropriate legal defense to avoid the challenge you\u2019re describing.<\/p>\n
Patrick Mu\u00f1oz: And if you really want a nuts-and-bolts conversation because you\u2019re interested in one of these proposals, we should have it in closed session so I can give you candid legal advice. At a high level, what I can say publicly is that the question is whether all these fees reasonably reflect the value of the franchise. That\u2019s something you could teach a whole law-school class on. It\u2019s complicated.<\/p>\n
Mayor Pro Tem Dunlap: Thank you. My next question is more practical, for staff: if we select a different hauler, what does the transition period or rollout look like, and what impacts will the city face?<\/p>\n
Michelle Durant: Some firms already submitted their SB 1383 rollout plan; some have completed their route maps. The first thing any firm must do is analyze the customer data \u2014 currently we don\u2019t have a complete multifamily list with unit counts, which ties directly to compliance percentages. So they\u2019d do a boots-on-the-ground review to account for all customers in each sector. The SB 1383 education and outreach plan runs in tandem \u2014 direct mailers, community workshops, and multifamily workshops at the complexes. We did a successful pilot in a senior mobile-home park on Valencia. Then it\u2019s time to right-size businesses and multifamily complexes, and do a waiver assessment, since the Senate bill allows waivers based on waste generation or physical space constraints \u2014 a lot of older multifamily properties may not have room for additional recycling or organics carts.<\/p>\n
Mayor Pro Tem Dunlap: My question was less about compliance and more about the practical rollout \u2014 making the switch. A lot of residents don\u2019t realize that commercial properties, apartment buildings, and office buildings have bins, some with pull-out service where crews physically remove them, adding cost. And commercial clients aren\u2019t only paying trash fees through their city utility bills; they also pay bin rentals and other direct fees to Republic. My hope is that as part of this shake-up, some of these legacy issues finally get addressed. That was part of the catalyst here \u2014 long-standing issues with Republic, and the inability to negotiate, which is how we found ourselves here. So this has actually presented a great opportunity, whether that means staying with Republic or making a change.<\/p>\n
One more question: I know staff shared rankings with the first report, but the second phase didn\u2019t include staff rankings. Were there internal notes or dialogue to a similar end, and would you share those?<\/p>\n
Mayor Jung: Mr.\u00a0Vallier, please come up and give us your ranking as the Mayor Pro Tem requested.<\/p>\n
Mike Valley: Previously you had a review committee of staff, and I didn\u2019t have a vote \u2014 I shared a memo with staff giving my opinions after the best-and-final, which were just mine. Going from bottom to top:<\/p>\n
I don\u2019t dislike Republic Services \u2014 I\u2019ve audited their operations in Florida, Georgia, Texas, Nevada, and Northern and Southern California, and worked with them in Costa Mesa and Los Alamitos. They\u2019re typically one of the best firms in the industry. My issues are specific to Fullerton. First, the rates \u2014 their commercial rates are by far the highest, so for that reason alone they wouldn\u2019t be in my top three. I also have compliance concerns that weren\u2019t addressed. To fix a problem you have to identify it: you gave them a rate increase to reach AB 1826 compliance, yet you\u2019re at about 6% compliance. And on AB 341 \u2014 you used to have mixed-waste processing (the Taormina brothers\u2019 operation) that sorted your trash and pulled out recycling, which counts as AB 341 compliance; that was taken away with no alternative and no price break. Those service issues weren\u2019t resolved. So \u2014 a great firm in many areas, but I don\u2019t think they\u2019ve been a great firm for Fullerton the last three or four years.<\/p>\n
Athens would be fifth for me, purely on pricing \u2014 great capabilities, facilities, service, and recommendations, but their residential rate is the highest and their commercial rate is also among the highest.<\/p>\n
I hate to drop Universal Waste to fourth, because I think the Blackburn family is wonderful and they do a great job in Los Alamitos. As the low-cost non-union provider \u2014 I congratulate the ad hoc committee for putting Valley Vista back in, because Valley Vista has the only high-diversion organic-waste processing facility that CalRecycle has approved in Southern California, which would let multifamily properties use just two containers and return to mixed-waste processing. Universal is working to get that designation but doesn\u2019t have it yet, and Valley Vista lowered their price to the point where they\u2019re very close. So on facility alone, that drops Universal to fourth for me.<\/p>\n
EDCO was my number one \u2014 I agreed with staff initially. But the initial cash figure, and I think they raised their commercial rates slightly, plus asking for a 20-year term tied to the facility they\u2019d build in the city \u2014 enough variables to move them down. That moved Valley Vista into second, just by being very good across the board \u2014 very low commercial rates and a competitive residential rate. So I think CR&R was the best overall offer. The upfront-payment tables you saw were my red flag \u2014 not that I\u2019m an attorney, but those payments are costs. So that\u2019s my study and personal opinion, not necessarily staff\u2019s.<\/p>\n
Council Member Valencia: Since Valley Vista was brought up to number two \u2014 a quick follow-up. You said Valley Vista serves smaller cities; the comparable used here is El Monte, with only 100,000 residents. Do they have the capacity to scale to a city our size, especially given we also have a university? And didn\u2019t they have to renegotiate their contract with Cyprus because they came in low?<\/p>\n
Mike Valley: That was actually done in what I think was their second amendment \u2014 they\u2019ve had four. I just did a compliance review where I looked at their earnings and margins, and they did fairly well. My feeling is that if they have a track record with 15 or so cities \u2014 from Pasadena down to Cypress \u2014 they could handle your city. Their facility definitely could; it\u2019s one of the leading facilities for size and ability to handle traffic. Personally, I wouldn\u2019t be afraid of them being able to do it \u2014 that\u2019s why they\u2019d be my number two.<\/p>\n
Mayor Jung: Any other questions? Very good.<\/p>\n
Council Comments<\/p>\n
Mayor Jung: I\u2019ll kick off the comment portion. My top three were CR&R, Valley Vista, and EDCO. I had concerns with EDCO \u2014 they were third for me. I was concerned in the same manner Council Member Zahra pointed out. Their $15 million upfront payment is impressive and hard to ignore; I\u2019m pretty sure they\u2019ve read the newspaper coverage of the city\u2019s financial challenges, and this is their way of addressing that. But it comes with very specific strings: EDCO wants a 20-year fixed term \u2014 twice as long as the RFP\u2019s 10 years \u2014 which obligates us to a very long-term relationship that may not be best over that length of time. Twenty years is incredibly long; I don\u2019t know that I\u2019ll be alive then, and certainly none of us will be on council. The contract also increases CPI by 4.01% compounding every year, which is extraordinarily expensive when residents and businesses are all trying to save. That\u2019s roughly $1.3 million more per year \u2014 so to Council Member Zahra\u2019s question about how it\u2019s recouped, that\u2019s how \u2014 a nearly $42 million increase in cost of service over the term. That\u2019s not nothing, and it\u2019s a cost borne by residents and businesses. That\u2019s unacceptable to me.<\/p>\n
So my top two, based fundamentally on where their redraws landed \u2014 and I think making them sharpen their pencils was a good process \u2014 are CR&R and Valley Vista. The one caveat: CR&R is union, Valley Vista is non-union, and so is Republic. Republic hasn\u2019t been terrific the last three years, but I don\u2019t know that we\u2019ve been terrific as a council either \u2014 you can blame me for that \u2014 so I want to give some grace. Their drivers know the routes, they\u2019re already here, and they\u2019re a union outfit.<\/p>\n
If I were to make a recommendation right now \u2014 and we\u2019re not deciding tonight \u2014 it\u2019s that the City Council embargo ends tonight. So far none of us have had the opportunity to be educated by the vendors one-on-one; it\u2019s all gone through staff and our consultant, which was fair up to now. But for a 10-year contract, we all need a seat at the table, to voice our priorities and to hold public hearings so the public can be heard. So my direction is: end the embargo and begin final negotiating terms with Republic, Valley Vista, and CR&R, with a final choice by this Council in September.<\/p>\n
Council Member Zahra: I don\u2019t mind removing the embargo, since we started it \u2014 I think it would help. But it should be structured so these meetings aren\u2019t held at cafes and coffee shops, but at the city, with staff present and notes taken, for transparency.<\/p>\n
On Valley Vista \u2014 they came with a good proposal, but I\u2019m not convinced they can scale to a city our size, especially on a 10-year contract; that\u2019s a risk, and I don\u2019t think we should put our residents at risk. They\u2019re also non-union, which puts some of our residents at risk of losing their jobs \u2014 so that\u2019s a nonstarter for me. Universal is the same situation, so I\u2019d exclude those two. Athens came in quite high. CR&R stands out as a decent proposal \u2014 lower commercial rate, a fair contract. I\u2019d like to see unlimited bulky-item removal and maybe a slightly better deal on rates.<\/p>\n
On Republic \u2014 they\u2019re the incumbent, so I\u2019m always in favor of giving them the opportunity to come back with a rebuttal, which helps avoid a disruption in service. But they disappointed me by coming back with this $10 million thing, which nobody on council or staff requested. They need to work on their commercial rates, and we need to be in compliance on all regulatory aspects.<\/p>\n
On the advances \u2014 they need to go. We shouldn\u2019t be negotiating anything new, unprecedented, or complicated; this should be a simple contract for trash removal. We can\u2019t burden residents and future residents with legal challenges and hidden fees. So that needs to go immediately. Same with EDCO \u2014 they\u2019d be on my list if they removed the whole $15 million advance and went back to basic rates and services. And whoever is chosen, we need to make sure our workers are taken care of.<\/p>\n
Mayor Jung: Good thoughts. Council Member Charles?<\/p>\n
Council Member Charles: Thank you. I hear some agreement \u2014 CR&R is looking like a standout, and for me being non-union is a nonstarter; it just is. Valley Vista\u2019s proposal showed no support for a strong union \u2014 at least Universal Waste said they put it to a vote of their employees, who decided to be non-union. I disagree with that decision, but that\u2019s what they decided. So I\u2019m not in favor of Valley Vista, though I understand my colleagues wanting to leave them in the mix, and I wouldn\u2019t throw a fit about it. Republic, of course, deserves a chance to keep at this \u2014 without the $10 million upfront, maybe coming in with much more competitive rates.<\/p>\n
Two things stood out to me about CR&R. First, going back to Mr.\u00a0Otter\u2019s comment \u2014 as an HOA treasurer, he\u2019s done great work, and he sent us the full scope of his analysis. I live in a complex with an HOA myself \u2014 about 60 townhomes; I\u2019m a renter, but the owner pays into these things. Mr.\u00a0Otter also did a lot of legwork talking to about 14 other HOAs across the city, not just the east side. It\u2019s such an important issue that multifamily doesn\u2019t get treated the same as industrial or commercial \u2014 it\u2019s a different entity. What I appreciate about CR&R is that their updated proposal specifically called out wanting to negotiate multifamily separately from commercial, and if you look at Mr.\u00a0Otter\u2019s analysis, which will be in the public record, single-family versus multifamily is very close. Equity matters \u2014 it shouldn\u2019t matter whether you own or rent; there needs to be parity where possible.<\/p>\n
Second \u2014 and this is coming from a public-health perspective and my own family life \u2014 CR&R talked about things like residential sharps collection and compost delivered directly to people\u2019s houses. That\u2019s real public-health and sustainability practice we don\u2019t see much in this city. I\u2019d love for our downtown restaurants and establishments to have sharps collection in their bathrooms, as some other cities do. So many people manage sharps at home now \u2014 type 2 diabetes, Ozempic, rheumatoid-arthritis drugs, all needle-injected. Disposing of them is difficult; you often have to order supplies and take them back to a provider. A company that acknowledges that would help a lot of people, especially seniors. So I appreciated those. I\u2019m happy to give Republic another chance, and if colleagues still want to hear from Valley Vista, so be it.<\/p>\n
Mayor Jung: Council Member Valencia, anything to add?<\/p>\n
Council Member Valencia: Since I\u2019ve been with this RFP since day one, I\u2019ve been able to look at all the information on the different proposals and talk to staff, so I appreciate everyone\u2019s hard work. My picks have changed over the course of the process \u2014 I\u2019ve enjoyed reading everybody\u2019s \u201cChristmas wish list\u201d of what they want to give the city.<\/p>\n
My top three: first, I want to work with Republic Services and give them a fair opportunity, building on what they\u2019ve started with our city. They know our routes, they\u2019ve heard what we need, and I think they\u2019re listening. There are still concerns to be worked out, and I\u2019d like to lift the embargo so we can have conversations with the haulers. Second, Valley Vista \u2014 I liked their no-cost street sweeping and procurement support for SB 1383, and their rate is on the lower end. Third, Athens \u2014 I really appreciate their proposal, and they have no hidden future costs, which is appealing, but their rate is so high it\u2019s hard to put that hike on residents right now. We\u2019re in a financial crisis, and I don\u2019t want to add more on our residents. So those are my picks.<\/p>\n
Mayor Jung: Mr.\u00a0Mayor Pro Tem, close us out.<\/p>\n
Mayor Pro Tem Dunlap: A few comments. First, I want to thank Mr.\u00a0Otter \u2014 the analysis he prepared was one of the most valuable we\u2019ve seen in this entire process, and it answered a question I\u2019d raised with staff several times: what\u2019s going on with commercial rates? Largely, commercial property owners end up subsidizing residential, and this table shows that at a disparity of rates. As we move forward \u2014 these rates are proposed, not set in stone \u2014 I\u2019d encourage the negotiating team, whichever hauler is selected, to do a better job narrowing these margins. If there\u2019s an opportunity for citizen engagement, Mr.\u00a0Otter has offered his services and would be a great resource.<\/p>\n
We\u2019re up here to take care of our residents. We can trust the employees of these companies to make the best decisions for their own careers, but our job is to make the best decision for our community \u2014 the best overall value. I think there was value in going to a best-and-final, and additional value in bringing back a shorter list \u2014 though we ended up with six or seven; I\u2019d have preferred an abbreviated list, because it put a lot of people through an unnecessary exercise. But looking at it tonight, I\u2019d be prepared to go forward with the top two: CR&R clearly my number one, EDCO second.<\/p>\n
On the upfront money \u2014 I\u2019m not opposed to it as long as it is just that. But to the extent the city, and specifically the ratepayer, would essentially be making a high-interest payment on a loan vehicle \u2014 as EDCO proposed over 20 years \u2014 that\u2019s a nonstarter for me. There are plenty of other city contracts, including OCP, where public benefits are provided; Republic currently provides public benefits. Funds for roads and streets are very important, but it needs to go specifically to what it\u2019s intended for \u2014 not just a check to the general fund that staff allocates to payroll and salaries. Roads and streets I think is perfectly suitable, and something I\u2019d support.<\/p>\n
A question, not a comment: do we have any idea how much we\u2019ve spent on additional consulting, attorney fees, and staff fees because of this whole ordeal \u2014 because of Republic\u2019s unwillingness or inability to come to the negotiating table early on?<\/p>\n
Staff: I don\u2019t have the exact figure. I could put something together for council \u2014 it was certainly mid-six figures.<\/p>\n
Mayor Pro Tem Dunlap: Let\u2019s use an exact figure \u2014 for Public Works. My last comment: I think we should put the bulk of the compliance on the back of the waste hauler. That\u2019s not something the city should be footing; it\u2019s something they need to take care of as part of their service. So, with that, I\u2019ve made my comments about CR&R.<\/p>\n
Motion and Vote<\/p>\n
Mayor Jung: It looks like we\u2019re pretty much in agreement on moving CR&R forward. I heard from a majority of my colleagues that they agree on Republic moving forward as our current hauler \u2014 these are two union haulers. I\u2019d also appreciate council supporting me on including a non-union firm, to compare like for like, which is the number-two firm from our consultant this evening, and also the Mayor Pro Tem\u2019s question \u2014 Valley Vista.<\/p>\n
I\u2019m making this as a motion because the City Attorney says I have to, even though tonight was to provide direction. As part of the motion, I want to lift the embargo, and I want to mandate two public meetings for the three haulers that move forward, so they answer the public\u2019s questions. This is a 10-year contract that fixes us down for an incredible length of time \u2014 certainly more than I\u2019ll be on this council. And I want to clarify that Republic should lift their $10 million gift and incorporate that back into rates when this comes back before us in September. With that, I\u2019ll seek a second.<\/p>\n
Mayor Pro Tem Dunlap: A question, going back \u2014 how far do we need to get into refining the specifics of the proposals? I had some comments and thoughts as well. Does that need to come up tonight?<\/p>\n
Mayor Jung: No.\u00a0Part of my motion is lifting the embargo. Actually, I want to self-impose an embargo \u2014 I don\u2019t want lobbying calls. You can do that, but that\u2019s part of it, so all our concerns get addressed, because in the end we\u2019re the voice of our constituents. Is there a second?<\/p>\n
Council Member: Second.<\/p>\n
Council Member: Could I get clarification on lifting the embargo?<\/p>\n
Mayor Jung: Lifting the embargo means \u2014 as Council Member Zahra said, not the notes thing, that\u2019s not necessary, but at City Hall with staff \u2014 you make the appointment.<\/p>\n
Council Member: Are we talking one-on-one?<\/p>\n
Mayor Jung: However the folks on the dais schedule it \u2014 I\u2019m not going to determine that. This motion is just selecting the top three for final negotiations. It comes back in September, we decide what we\u2019re doing, and staff takes the directions into consideration on the details. That\u2019s why I said \u201clift the embargo\u201d \u2014 so you speak for the constituents you represent.<\/p>\n
Council Member: On the public comment about Republic incorporating that $10 million back into the rate structure \u2014 is it possible to vote on that individually?<\/p>\n
Mayor Jung: I heard all of us talk about CR&R, and I heard a majority talk about Republic. I\u2019m not interested in belaboring this or making it longer than it has to be.<\/p>\n
Council Member Charles (substitute motion): Substitute motion: put everything you included, but only CR&R and Republic \u2014 and we\u2019d vote on Valley Vista\u2019s inclusion separately.<\/p>\n
Mayor Jung: Is there a second for that?<\/p>\n
(No second offered.)<\/p>\n
Mayor Jung: All right, there\u2019s a substitute motion. Madam Clerk, please call the roll \u2014 with the contingency of removing the $10 million, moving forward with CR&R and Republic as the two candidates.<\/p>\n
City Clerk: Council Member Charles \u2014 aye. Council Member Valencia \u2014 no. Council Member Zahra \u2014 aye. Mayor Pro Tem Dunlap \u2014 no. Mayor Jung \u2014 no.<\/p>\n
Mayor Jung: The substitute motion fails. We\u2019ll go back to the original motion. Madam Clerk, call the roll.<\/p>\n
City Clerk: Council Member Charles \u2014 aye. Council Member Valencia \u2014 aye. Council Member Zahra \u2014 aye. Mayor Pro Tem Dunlap \u2014 aye. Mayor Jung \u2014 aye.<\/p>\n
Mayor Jung: The motion passes unanimously. Very well. Thank you, everybody. Have a great Fourth of July. Happy birthday, America.<\/p>\n
(Meeting adjourned.)<\/p>\n
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