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CC 2021-11-09_11a IWMA Second AmendmentMEMORANDUM TO: CITY COUNCIL FROM: WHITNEY MCDONALD, CITY MANAGER SUBJECT: APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS D ATE: NOVEMBER 9, 2021 SUMMARY OF ACTION: 1)Approve the Second Amendment to the San Luis Obispo County Integrated Waste Management Authority (IWMA) Joint Powers Agreement (JPA) to remove the County of San Luis Obispo (County) from the JPA, 2) approve the First Amendment to the Memorandum of Agreement (MOA) between the member jurisdictions of the IWMA and the special districts that are currently subject to the MOA to acknowledge the Third Amendment to the JPA, and 3) adopt a Resolution declaring the City’s intent to remain a member of the IWMA so long as certain conditions are met. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The proposed Resolution includes a condition insisting that the IWMA retain a third-party firm with solid waste management expertise to analyze fees, staffing structures and make recommendations for any programs and services that are not required by, or are in excess of, State solid waste regulations. The condition states that the report shall identify potential cost saving measures and that the IWMA Board shall evaluate and implement those recommendations to reduce costs and minimize expenses. At this time, it is unclear what this report will conclude. It is also currently unclear whether it will be most cost- efficient to the City and its solid waste customers for the City to remain with the IWMA or to seek services from another agency, such as the County. Additional time and analysis is necessary to evaluate this issue, and the proposed Resolution would require the IWMA to perform the analysis that is necessary to enable the City to make a determination regarding cost effectiveness. The IWMA has engaged its current consultant, HF&H, to conduct an analysis of the fees that will be needed to support the IWMA’s work in light of both SB 1383 and the departure of the County of San Luis Obispo from the IWMA. That analysis is underway; however, it is not currently scoped to satisfy the condition requiring a study analyzing the fees, staffing structures, and cost saving measures to be implemented by the IWMA. IWMA-related fees have historically been assessed as pass- through costs to the customers of South County Sanitary Services. New or increased Item 11.a. - Page 1 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 2 IWMA fees will be included as part of a future rate adjustment requested by South County Sanitary Services consistent with the City’s franchise agreement. RECOMMENDATION: 1) Approve the Second Amendment to the San Luis Obispo County Integrated Waste Management Authority (“IWMA”) Joint Powers Agreement; 2) Approve the First Amendment to the Memorandum of Agreement (MOA) between the member jurisdictions of the IWMA and the authorized districts; and 3) Adopt a Resolution declaring the City’s intent to remain a member of the IWMA so long as certain conditions are met. BACKGROUND: The Integrated Waste Management Authority (IWMA) is a Joint Powers Authority that has been comprised of the County of San Luis Obispo (County), seven cities (Arroyo Grande, Atascadero, Grover Beach, Morro Bay, Paso Robles, Pismo Beach, and San Luis Obispo) and numerous special districts (the Avila Beach, California Valley, Cambria, Ground Squirrel Hollow, Heritage Ranch, Los Osos, Nipomo, Oceano, San Miguel, San Simeon, and Templeton Community Services Districts, and the Cayucos Sanitary District). The IWMA is governed by a First Amended Joint Powers Agreement entered into by the County and the seven cities. A Memorandum of Agreement between the IWMA’s member jurisdictions and the special districts in the County with activated solid waste powers governs the identified special districts’ participation in the IWMA. The IWMA is governed by a thirteen-member Board of Directors consisting of all five County Supervisors, one elected representative from each of the seven cities, and one elected representative from the participating special districts. The IWMA manages regional household hazardous waste programs and educates and reports on solid waste, recycling, and food/green waste on behalf of its members. The IWMA has allowed JPA members to pool resources and cost-effectively comply with various solid waste regulations, including the recently enacted Short Lived Climate Pollutants regulations – commonly referred to as Senate Bill (SB) 1383. The IWMA staff administer over 40 different solid waste programs, including monitoring and reporting to the State, household hazardous waste collection, electronics waste collection, sharps disposal, and public education and outreach. On May 18, 2021, the County of San Luis Obispo commissioned a third-party study of costs to assess the fiscal impacts of the County’s withdrawal from the IWMA. The study determined five new full-time positions and multiple programs would be necessary to meet the service level necessary for compliance with SB1383 and historically provided by the IWMA. The cost of implementing a new program at the County was estimated to Item 11.a. - Page 2 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 3 be between $1.6 to $2.1 million per year. To cover these projected cost increases, the County would need to immediately increase solid waste rates by 10% to 12% for residents in unincorporated areas not served by authorized special districts. The County’s analysis did not include consideration of how withdrawal would financially impact remaining JPA members, or the policy and JPA issues raised from such a withdrawal. On August 10, 2021, the County Board of Supervisors held a hearing to decide whether to withdraw from the IWMA and voted to withdraw from the IWMA and implement an independent County solid waste compliance program. On September 14, 2021, the County Board of Supervisors passed a Resolution to formally notify the IWMA of its intent to withdraw on November 15, 2021. On June 9, 2021, the IWMA Board of Directors adopted a resolution increasing its fees to address the anticipated additional costs of implementing SB 1383. Under the previously-adopted fee resolution, waste haulers were responsible for paying the following fees to the IWMA: 2% of gross revenue collected from commercial customers, $0.30 per month for residential customers paying less than $50 per month, 2% for residential customers paying more than $50 per month, and a tipping fee of $3 per ton. The new resolution adopted in June 2021 imposes the following fees on waste haulers: 3.25% of gross revenue collected from all customers and a $4 per ton tipping fee. The resolution was to become effective on October 1, 2021. However, significant confusion arose regarding the proper procedure for implementing the new fees and, upon the County’s announcement of its intent to withdraw from the IWMA, it became clear that the adopted fees were likely to change. As a result, the IWMA Board subsequently directed that the fee resolution will not be implemented until January 1, 2022. On October 13, 2021, the IWMA Board of Directors approved as to form an amendment to the JPA that removes the County and enables the Board of Directors to continue to meet and conduct the necessary business of the IWMA (Attachment 1). In addition, the IWMA Board of Directors approved as to form an amendment to the MOA between the IWMA members and the special districts to ensure consistency with the amended JPA (Attachment 3). In order to become effective, both of these documents must be approved by all of the remaining members of the IWMA. ANALYSIS OF ISSUES: Ratepayers in the City currently contribute approximately $105,000 per year to the IWMA for its services, through a combination of a solid waste management fee paid by all solid waste rate payers (approximately $50,000 per year), and a landfill tipping fee surcharge of $3 per ton (approximately $55,000 per year). This amounts to roughly 5.25% of the IWMA’s $2 million annual budget. Prior to the County’s withdrawal notification, the IWMA Item 11.a. - Page 3 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 4 stated the need to increase its annual budget to about $3.7 million to conduct additional SB 1383 compliance work. If the City’s contribution rate to the IWMA’s annual operating costs remains the same, at 5.25%, and if the IWMA’s annual budget remains as estimated at $3.7 million, the City’s future costs to remain part of the IWMA may be approximately $194,250. The HF&H fee reanalysis is currently underway and is intended to confirm or revise estimated fiscal impacts of the County leaving the IWMA and the service costs of complying with SB1383 by IWMA member agencies. The County’s withdrawal will increase the City’s proportional share of the IWMA’s annual budget and is expected to require an increase in the IWMA’s fee for all remaining members. While changes in service level and revenue are anticipated impacts of the departure of the County, further analysis is required to understand the breadth of those impacts on the remaining member agencies. Despite the circumstances of the County’s departure and amidst the reassessment of fees, representatives of several cities have expressed their intent to remain members of the IWMA. Toward this end, the cities of Grover Beach, Morro Bay, Paso Robles, Pismo Beach, and San Luis Obispo have adopted resolutions stating their intent to remain in the IWMA. With the exception of the City of Morro Bay, the resolutions adopted by the cities include certain conditions that require the IWMA to take steps to address the near- and long-term needs of the member agencies. These conditions are discussed in more detail below. The City of Arroyo Grande is, and has been, a significant partner to the IWMA, and the IWMA has been a critical partner in assisting the City in meeting compliance with State mandates, including SB 1383. Agencies continued participation as members of the IWMA is critical for the IWMA’s ongoing viability as a regional organization. Regionality in solid waste traditionally provides an economy of scale, ensures consistent education and outreach among member jurisdictions, and locally has been a successful means of meeting waste diversion and compliance since 1994. The role of the IWMA has provided its member agencies with educational outreach on landfill diversion, source reduction, and emissions reduction efforts implemented in local communities. The IWMA is a regional government entity representing its members in solid waste diversion and reduction efforts. The efficacy of the organization depends on the breadth and participation of its member base. To remain an operating JPA, the remaining member agencies must agree on terms for the organization without the County’s involvement. Staff and City Management met and conferred on what conditions would be necessary to commit to continued membership once the County fully withdraws. Proposed Second Amendment to the JPA and First Amendment to the MOA The proposed Second Amendment to the JPA and the MOA amendment are necessary to remove the County from the JPA and its Board of Directors to ensure that the IWMA Board of Directors may continue to meet without the participation of the County Board of Item 11.a. - Page 4 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 5 Supervisors. The proposed amendments also include changes to the quorum and voting provisions contained in section 8.5 of the JPA. Currently, Section 8.5 requires at least one County representative to constitute a quorum. In addition, Section 8.5 includes language requiring eight affirmative votes (aka, a “supermajority”) of the Board of Directors to approve any action when invoked by any member of the Board. This supermajority provision is proposed to be removed as there will only be eight remaining members of the IWMA Board of Directors following the removal of the five County Supervisors. The MOA is also proposed to be amended to bind the participating special districts to the terms of Second Amended JPA. It is anticipated that additional amendments will be made to the JPA to address the needs of the remaining members. A committee of staff from the IWMA and the remaining member agencies is being formed to develop the additional amendments, which will return to the member agencies for adoption at a later date. Resolution of Intent to Remain a Member of the IWMA In addition to the proposed amendments to the JPA and MOA, a resolution has been prepared to enable the City to express support for the ongoing regional work of the IWMA while also identifying specific conditions to address remaining concerns following the County’s exit (Attachment 5). The proposed Resolution requires additional revisions to the JPA Agreement, as well as other actions, in order for the City to continue its membership. These revisions and additional actions include: 1.Add a provision to the JPA which clearly and directly limits the IWMA’s ability to adopt, impose, or implement any rule, regulation, policy, or ordinance in excess of State requirements (also requested by Grover Beach, Paso Robles, Pismo Beach, and San Luis Obispo); 2.Amend the JPA to require at least 6 months’ notice in the event that a member wishes to leave the IWMA (also requested by Pismo Beach); 3.Begin recruitment and diligently pursue hiring a permanent Executive Director as soon as practical (also requested by Grover Beach, Paso Robles, Pismo Beach, and San Luis Obispo); and 4.Hire a third-party firm with solid waste management expertise to analyze fees, staffing structures and make recommendations for any programs and services that are not required by, or are in excess of, State solid waste regulations. The report shall identify potential cost saving measures and the IWMA Board shall review and implement those recommendations to reduce costs and minimize expenses. The report must be reviewed by the managers of the IWMA member agencies before it is finalized and implemented (also requested by Grover Beach, Paso Robles, Pismo Beach, and San Luis Obispo, with the exception of the italicized language which is proposed by Arroyo Grande); and Item 11.a. - Page 5 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 6 5.Provide all information necessary to support the adoption of fees that meet all applicable legal requirements, including any information needed by the member agencies to implement the IWMA’s fees as determined through coordination with the managers of the member agencies (requested by Arroyo Grande only); and 6.Rescind IWMA Resolution No. 21-06-02 and coordinate with the member agencies’ managers before adopting any other increases to the IWMA’s fees (requested by Arroyo Grande only). These changes and actions will correct historical problems at the IWMA and help to bring stability to the organization. At this time, the first item listed above has been requested by the cities of Grover Beach, Paso Robles, Pismo Beach, and San Luis Obispo. As a result, it is proposed that the City support this request as well in order to meet the needs of the remaining member agencies. The second item listed above has been requested by the City of Pismo Beach as a mechanism to address the challenges that the short 30-day notice period currently contained in the JPA has created for the IWMA and its member agencies. The third item has been included to ensure that the IWMA retains high-quality leadership to bring greater stability to the organization. The fourth item listed above has been included to ensure that the IWMA’s budget reflects the true needs of the organization following the County’s exit. This analysis is crucial to the agency’s ability to establish appropriate fees to support its ongoing operations. The fifth and sixth items described above are included to ensure that the City, and all other member agencies, receive all information necessary to implement future fee increases by the IWMA. In light of the confusion surrounding the proper procedures for implementing the IWMA’s fee adjustments, increased coordination is necessary. Additionally, because the fee increase adopted by the IWMA Board of Directors in June 2021 does not address the effects of the County’s departure, that resolution should be rescinded so as to not create more confusion for the member agencies, their waste haulers, or their customers. The proposed Resolution further states the City’s intent to continue evaluating the financial implications of remaining with the IWMA as compared to other options for meeting the State’s waste management requirements, as discussed further below. Alternatives to Remaining in the IWMA The City may also consider withdrawing from the IWMA, as the County did; however, the City would then become responsible for all of the work required under applicable State laws governing waste management, including SB 1383. This would require the City to implement new programs in the following areas, at a minimum: •Ordinances and policies meeting all applicable State laws and regulations; Item 11.a. - Page 6 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 7 •Management of household hazardous waste recovery sites and services; •Capacity planning for organics processing and edible food recovery; •Ensure that all customers have organics collection services and that the organics waste streams are properly processed; •Monitoring and enforcement, including annual inspections of commercial and multi-family housing solid waste accounts, as well as contamination monitoring of all waste streams; •Planning and implementation of an edible food recovery program; •Education and outreach to all solid waste customers on their compliance obligations; and •Reporting and record keeping, including submittal of annual reports to the State. In order to complete these tasks itself, the City would need to hire additional staff and consultants who are experienced in managing waste programs in California. It is highly likely that the costs to implement the City’s own waste program would exceed the total fees paid by City customers to the IWMA. However, consultation with experienced waste management professionals would be needed to more accurately determine the staffing and financial resources necessary to comply with all applicable waste regulations. The City may also consider seeking to contract with the County or another agency to provide the services necessary to meet the State’s waste management requirements. However, it is unknown whether the County or other city would be interested and/or able to provide these services to the City, and it is unclear what the costs of such an approach would be for the City. In addition, contracting with the County or other local agency would remove the City’s ability to share in policy and governance decisions that impact the City’s customers. A Joint Powers Authority reserves the ability of the City to take part in these decisions through representation on the agency’s Board of Directors. Finally, any efforts by the City to begin its own waste management program or to contract with another agency, such as the County, for its services runs the risk that the programs will not be implemented by the January 1, 2022 deadline under SB 1383. Under SB 619, local agencies may seek reprieve from penalties assessed by CalRecycle for failure to implement SB 1383. However, agencies are required to provide proof of good faith efforts to comply. In light of the foregoing, it is recommended that the City continue its participation in the IWMA for the time being. Assuming the IWMA satisfies the conditions required by the cities, more information will become available to identify the true costs to the City’s customers to continue receiving services from the IWMA. If directed by Council, staff may also work, in the meantime, to obtain additional information from the County or other Item 11.a. - Page 7 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 8 agencies to determine the comparative costs of contracting with those other agencies for waste management services. Approving the amendments to the JPA and MOA and adopting the proposed Resolution will provide time for the City to gather this information while also providing proof of the City’s efforts to timely implement SB 1383. ALTERNATIVES: The following alternatives are provided for the Council’s consideration: 1.Adopt staff’s recommendations to (1) Approve the Second Amendment to the San Luis Obispo County Integrated Waste Management Authority Joint Powers Agreement; (2) approve the First Amendment to the Memorandum of Agreement between the member jurisdictions of the IWMA and the authorized districts; and (3) adopt a Resolution declaring the City’s intent to remain a member of the IWMA so long as certain conditions are met; 2.Approve the Second Amendment to the San Luis Obispo County Integrated Waste Management Authority Joint Powers Agreement, and approve the First Amendment to the Memorandum of Agreement between the member jurisdictions of the IWMA and the authorized districts, but do not adopt the Resolution declaring the City’s intent to remain a member of the IWMA or provide direction to alter and adopt the Resolution; 3.Provide direction to further evaluate withdrawing from the IWMA and entering into an agreement with the County to conduct all waste regulatory compliance work; or 4.Provide additional direction to staff to perform an analysis on the comparative costs of staffing and performing these services in-house; or 5. Provide other direction to staff. ADV ANTAGES: Approving staff’s recommendations will enable the City to continue its membership in the IWMA, which significantly assists the City in satisfying its waste management obligations under State law, including the pending challenges of SB 1383 implementation. The proposed Resolution establishes expectations for the IWMA to address the needs of its member agencies following the County’s exit and to ensure that it will continue to meet all State mandates for local waste management. Together, the recommended actions will also provide time for the City, the IWMA, and its member agencies to ensure that the IWMA continues to provide the most effective and cost-efficient mechanism for meeting the agencies’ waste requirements. DISADVANTAGES: It is unclear what costs will be borne by the City’s customers resulting from the County’s decision to withdraw from the IWMA and the City’s decision to remain in the IWMA. Additional information is necessary to fully evaluate this issue and the IWMA will need to complete a more detailed analysis to provide accurate estimates to the City. Item 11.a. - Page 8 CITY COUNCIL APPROVAL OF SECOND AMENDMENT TO THE INTEGRATED WASTE MANAGEMENT AUTHORITY (IWMA) JPA, FIRST AMENDMENT TO THE IWMA MEMORANDUM OF AGREEMENT, AND RESOLUTION DECLARING INTENT TO REMAIN A MEMBER OF THE IWMA SUBJECT TO CONDITIONS NOVEMBER 9, 2021 PAGE 9 ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1.Second Amendment to the Joint Powers Agreement 2.Joint Powers Agreement 3.First Amendment to the Memorandum of Agreement 4.Memorandum of Agreement between IWMA and Special Districts 5.Proposed Resolution Item 11.a. - Page 9 SAN LUIS OBISPO COUNTY · INTEGRATED WASTE MANAGEMENT AUTHORITY Connecting the Communi t y to Wa s te S olution s IWMA Board of Di rector's Charl es Bo urb ea u -Pr es ide nt, Ci ty of At ascade r o Jan M arx -Vi ce Pr es id ent, City of Sa n Lui s Obispo Rob ert Enn s -Pas t Pr esid ent, Spec ial Di strict s Debbi e Arn o ld - Sup erviso r, Sa n Lui s Obi spo Co un ty Di st. S Kare n Bri ght, City of Grove r Beac h Lynn Co mpton - Sup ervi so r, San Lui s Obi spo County Di st. 4 Bru ce Gib so n - Su pervisor, Sa n Lui s Obi spo County Di st . 2 Jo hn Ham o n, City of Pas o Robl es Jeff Hell er, City o f Morro Bay Sco t t Newto n, Ci t y of Pi smo Beac h Dawn Ort iz-Legg - Sup ervi sor, San Lui s Obispo Co unty Di st. 3 John Pescho ng -Sup erv iso r, San Lui s Obispo County Di st. 1 Keith St o rto n, City of Arroyo Gr and e IWMA Staff Patti To ew s, Interim Exec utive Director Kelly Yo rk, SB Pro g ram M anage r Barb ara Aspern e lso n, Acco untant Sas ha Del Giorgio, Clerk of the Bo ard Jeff Minnery Lega l Coun se l October 19, 2021 City of Arroyo Grande Attn: City Manager and Legal Counsel 300 East Branch Street Arroyo Grande, CA. 93420 Via Electronic and U.S. Mail Re: Agency Adoption of Amendment to the IWMA Joint Powers Agreement ("JPA'') Adoption of Amendment to the IWMA Memorandum of Agreement t'MOA") Dear City Manager and Legal Counsel: On October 13, 2021, the Board of Directors of the San Luis Obispo County Integrated Waste Management Authority ("IWMA11 ) approved "as to form 11 the enclosed amendment to the JPA ("JPA Amendment11 ). The changes are limited to those specific to board composition, quorum requirements, and the required Government Code designated agency, following the County's formal withdrawal on November 15, 2021. The "supermajority11 provision in Section 8.5 is also deleted. Without this deletion, a unanimous vote could be required on any item with the request of one board member. Instead, this revision provides for a simple majority on all matters. The IWMA Executive Committee is considering the formation of an ad hoc committee to assist with further modification of the JPA in the near future. This JPA Amendment reflects a preliminary step. At the same October meeting, the IWMA Board of Directors also approved "as to form 11 the enclosed amendment to the Memorandum of Agreement ("MOA Amendment11 ). The MOA was originally executed by and between the Cities, the County, and Special Districts with solid waste powers, to amend the JPA Agreement to include those Special Districts for representation on the IWMA Board. This MOA Amendment formalizes the Special Districts' acceptance of the aforementioned amendment to the JPA. For the JPA Amendment and the MOA Amendment to be effective, they will need to be adopted by all member agencies. It is our anticipation that your city council will consider these Amendments prior to November 15, 2021 . Please contact me if you have any questions . f ~, ~rn,;ve D;rector · San Luis Obispo Integrated Wa ste Man agement Authority Enclosures: Amendm ent to IWMA JPA re Quorum_redlin e Amendment to IWMA JPA r e Qu orum _cl ean Am endment to IWMA MOA re JPA Am endm ent Attachment 1 Item 11.a. - Page 10 SECOND AMENDMENT TO THE SAN LUIS OBISPO COUNTY INTEGRATED WASTE MANAGEMENT AUTHORITY ("IWMA") JOINT POWERS AGREEMENT This Second Amendment to the Joint Powers Agreement ("Second Amendment") dated October 13, 2021, is made by and between the incorporated cities of Arroyo Grande, Atascadero, El Paso de Robles, Grover Beach, Morro Bay, Pismo Beach, and San Luis Obispo, hereinafter called "Cities," and the County of San Luis Obispo, hereinafter called "County. RECITALS WHEREAS, on May 10, 1994, an agreement was executed by and between the Cities and the County forming a joint powers authority pursuant to the provisions of the Joint Exercise of Powers Act (Government Code sections 6500 et seq.), for the purposes of facilitating the development of waste diversion programs and projects and of providing economies of scale on a regional basis (hereinafter referred to as the "JPA Agreement"); and WHEREAS, in or around 2001, a memorandum of agreement ("MOA") was executed by and between the Cities, the County, and certain special districts within the County ("Authorized Districts") (collectively "parties") amending the JPA Agreement to include the Authorized Districts for representation on the IWMA Board ("First Amendment to the JPA Agreement"); and WHEREAS, Section 7.2 (b) of the JPA Agreement provides that "[r]epresentatives to the Authority shall consist of the five members of the Board of Supervisors of the County of San Luis Obispo and of one additional member from the governing body of each incorporated city within the boundaries of the County of San Luis Obispo which is a party to this Agreement ... "; and WHEREAS, Section 8.5 of the JPA Agreement provides that to establish a quorum of the IWMA Board, there must be present a majority of representatives, "including one COUNTY representative"; and WHEREAS, on September 14, 2021, the County Board of Supervisors voted to withdraw from the IWMA with an effective date of November 15, 2021; and WHEREAS, to facilitate the continued operation of the IWMA Board of Directors without the County as a member jurisdiction, this Second Amendment to the JPA Agreement is necessary to ( 1) revise the representative members of the IWMA Board of Directors to eliminate the participation of the County Board of Supervisors; and (2) eliminate the requirement that a County representative is required to establish a quorum of the IWMA Board. 1 Item 11.a. - Page 11 NOW, THEREFORE, IT IS AGREED AS FOLLOWS: 1. Section 5.3 of the JPA Agreement is amended and restated as follows: Such powers shall be exercised subject only to the limitations set forth in this Agreement, applicable law and such restrictions upon the manner of exercising such powers as are imposed by law upon the Members in the exercise of similar powers. In no event shall the Authority be authorized to exercise any power not expressly authorized. The Authority hereby designates the City of San Luis Obispo San Luis Obispo County as the Member required to be designated by Section 6509 of the California Government Code. 2. Section 7.2 (b) of the JPA Agreement is amended and restated as follows: Representatives of the COUNTY and CITIES shall be appointed to serve on the Board in accordance with procedures established by each of the governing bodies of the member agencies. Representatives to the Authority shall consist of the five members of the Board of Supervisors of the County of San Luis Obispo and of one additional member from the governing body of each incorporated city within the boundaries of the County of San Luis Obispo which is a party to this Agreement, with each incorporated area being limited to one representative. Representatives shall serve so long as they hold office with their member agency or until they shall resign or be removed by a majority vote of their member agency. Vacancies among representatives shall be filled in the same manner as the first appointment. 3 . Section 8.5 of the JPA Agreement is amended and restated as follows: 8 .5 Quorum and voting. For purposes of conducting business, there shall be present a quorum consisting of a majority of representatives.,_, including one COUNTY representative . Each representative shall have one vote. No action shall be effective without the affirmative votes of a majority of those present. However, eight (8) affirmative votes shall be required for taking any action in the event any Member demands such a vote. The representatives to the Authority shall adopt such procedures as are consistent with this Agreement and necessary to conduct the business of the Authority in an orderly manner. 4. All other terms and conditions of the JPA Agreement will remain in full force and effect. 5. Effective Date. This Second Amendment shall become effective upon the adoption and execution of all member agencies and the formal exit of the County of San Luis Obispo from the IWMA. 2 Item 11.a. - Page 12 IN WITNESS WHEREOF, the parties have each caused this Second Amendment to the JPA to be executed by their duly authorized representative effective upon the execution by all member agencies. 3 Item 11.a. - Page 13 SECOND AMENDMENT TO THE SAN LUIS OBISPO COUNTY INTEGRATED WASTE MANAGEMENT AUTHORITY ("IWMA") JOINT POWERS AGREEMENT This Second Amendment to the Joint Powers Agreement ("Second Amendment") dated October 13, 2021, is made by and between the incorporated cities of Arroyo Grande, Atascadero, El Paso de Robles, Grover Beach, Morro Bay, Pismo Beach, and San Luis Obispo, hereinafter called "Cities," and the County of San Luis Obispo, hereinafter called "County." RECITALS WHEREAS, on May 10, 1994, an agreement was executed by and between the Cities and the County forming a joint powers authority pursuant to the provisions of the Joint Exercise of Powers Act (Government Code sections 6500 et seq.), for the purposes of facilitating the development of waste diversion programs and projects and of providing economies of scale on a regional basis (hereinafter referred to as the "JPA Agreement"); and WHEREAS, in or around 2001, a memorandum of agreement ("MOA'') was executed by and between the Cities, the County, and certain special districts within the County ("Authorized Districts") (collectively "parties") amending the JPA Agreement to include the Authorized Districts for representation on the IWMA Board ("First Amendment to the JPA Agreement"); and WHEREAS, Section 7.2 (b) of the JPA Agreement provides that "[r]epresentatives to the Authority shall consist of the five members of the Board of Supervisors of the County of San Luis Obispo and of one additional member from the governing body of each incorporated city within the boundaries of the County of San Luis Obispo which is a party to this Agreement ... "; and WHEREAS, Section 8.5 of the JPA Agreement provides that to establish a quorum of the IWMA Board, there must be present a majority of representatives, "including one COUNTY representative"; and WHEREAS, on September 14, 2021, the County Board of Supervisors voted to withdraw from the IWMA with an effective date of November 15, 2021; and WHEREAS, to facilitate the continued operation of the IWMA Board of Directors without the County as a member jurisdiction, this Second Amendment to the JPA Agreement is necessary to (1) revise the representative members of the IWMA Board of Directors to eliminate the participation of the County Board of Supervisors; and (2) eliminate the requirement that a County representative is required to establish a quorum of the IWMA Board. 1 Item 11.a. - Page 14 NOW, THEREFORE, IT IS AGREED AS FOLLOWS: 1. Section 5.3 of the JPA Agreement is amended and restated as follows: Such powers shall be exercised subject only to the limitations set forth in this Agreement, applicable law and such restrictions upon the manner of exercising such powers as are imposed by law upon the Members in the exercise of similar powers. In no event shall the Authority be authorized to exercise any power not expressly authorized. The Authority hereby designates the City of San Luis Obispo as the Member required to be designated by Section 6509 of the California Government Code. 2. Section 7.2 (b) of the JPA Agreement is amended and restated as follows: Representatives of the CITIES shall be appointed to serve on the Board in accordance with procedures established by each of the governing bodies of the member agencies. Representatives to the Authority shall consist of one member from the governing body of each incorporated city, within the boundaries of the County of San Luis Obispo, which is a party to this Agreement, with each incorporated area being limited to one representative. Representatives shall serve so long as they hold office with their member agency or until they shall resign or be removed by a majority vote of their member agency. Vacancies among representatives shall be filled in the same manner as the first appointment. 3. Section 8.5 of the JPA Agreement is amended and restated as follows: 8.5 Quorum and voting. For purposes of conducting business, there shall be present a quorum consisting of a majority of representatives. Each representative shall have one vote. No action shall be effective without the affirmative votes of a majority of those present. The representatives to the Authority shall adopt such procedures as are consistent with this Agreement and necessary to conduct the business of the Authority in an orderly manner. 4. All other terms and conditions of the JPA Agreement will remain in full force and effect. 5. Effective Date. This Second Amendment shall become effective upon the adoption and execution of all member agencies and the formal exit of the County of San Luis Obispo from the IWMA. IN WITNESS WHEREOF, the parties have each caused this Second Amendment to the JPA to be executed by their duly authorized representative effective upon the execution by all member agencies. 2 Item 11.a. - Page 15 CITY OF ARROYO GRANDE By: __________ _ Date: ----------Mayor Resolution No. -------- Clerk APPROVED AS TO FORM AND LEGAL EFFECT: By:------------ City Attorney 3 Date: ---------- Item 11.a. - Page 16 FIRST AMENDMENT TO THE MEMORANDUM OF AGREEMENT BETWEEN THE MEMBER JURISDICATIONS OF THE SAN LUIS OBISPO COUNTY INTEGRATED WASTE MANAGEMENT AUTHORITY AND THE AUTHORIZED DISTRICTS This First Amendment to the Memorandum of Agreement ("First Amendment to the MOA'') is executed on the date below stated, by and between the Member Jurisdictions of the San Luis Obispo County Integrated Waste Management Authority (the County of San Luis Obispo and the incorporated cities of Arroyo Grande, Atascadero, El Paso de Robles, Grover Beach, Morro Bay, Pismo Beach, and San Luis Obispo) and the special district parties to the Memorandum of Agreement ("MOA") (Avila Beach Community Services District, California Valley Community Services District, Cambria Community Services District, Cayucos Sanitary District, Ground Squirrel Hollow Community Services District, Heritage Ranch Community Services District, Los Osos Community Services District, Nipomo Community Services District, Oceana Community Services District, San Miguel Community Services District, San Simeon Community Services District, and Templeton Community Services District (hereinafter "Authorized Districts")). RECITALS WHEREAS, on May 10, 1994, an agreement was executed by and between the incorporated cities of San Luis Obispo County and the County of San Luis Obispo forming a joint powers authority pursuant to the provisions of the Joint Exercise of Powers Act (Government Code sections 6500 et seq.), for the purpose of facilitating the development of waste diversion programs and projects that provide economies of scale without interfering with individual agencies' exercise of power within their own jurisdiction (hereinafter referred to as the "JPA Agreement"); and WHEREAS, pursuant to the JPA Agreement, the power to perform the responsibilities of the joint powers authority was vested in the San Luis Obispo County Integrated Waste Management Authority Board of Directors ("IWMA Board"); and WHEREAS, in or around 2001, an MOA was executed by and between the incorporated cities, the County of San Luis Obispo, and the Authorized Districts amending the JPA Agreement to include the Authorized Districts for representation on the IWMA Board ("First Amendment to the JPA Agreement"); and WHEREAS, in or around October 13, 2021, the JPA Agreement was amended ("Second Amendment to the JPA Agreement") to reflect the County of San Luis Obispo's withdrawal from the IWMA (a true and correct copy of the Second Amendment to the JPA Agreement is attached hereto as Exhibit A); and 1 Item 11.a. - Page 17 WHEREAS, by this First Amendment to the MOA, the parties hereto desire to acknowledge, accept, and agree to be bound by the terms and conditions of the Second Amendment to the JPA Agreement. NOW, THEREFORE, IT IS AGREED AS FOLLOWS: 1. The parties hereto desire to acknowledge, accept, and agree to be bound by the terms and conditions of the Second Amendment to the JPA Agreement. 2. All other terms and conditions of the MOA will remain in full force and effect. This First Amendment to the MOA may be executed in any number of counterparts, each of which when executed and delivered shall constitute a duplicate original, but all counterparts together shall constitute a single agreement. IN WITNESS WHEREOF, the parties have each caused this First Amendment to the MOA to be executed by their duly authorized representative effective upon the execution by all member agencies. 2 Item 11.a. - Page 18 CITY OF ARROYO GRANDE By:------------Date: ----------Mayor Resolution No. ------- Clerk APPROVED AS TO FORM AND LEGAL EFFECT: By:------------Date: ----------City Attorney 3 Item 11.a. - Page 19 Attachment 2 Item 11.a. - Page 20 Item 11.a. - Page 21 Item 11.a. - Page 22 Item 11.a. - Page 23 Item 11.a. - Page 24 Item 11.a. - Page 25 Item 11.a. - Page 26 Item 11.a. - Page 27 Item 11.a. - Page 28 Item 11.a. - Page 29 Item 11.a. - Page 30 Item 11.a. - Page 31 Item 11.a. - Page 32 Item 11.a. - Page 33 Item 11.a. - Page 34 Item 11.a. - Page 35 Item 11.a. - Page 36 Item 11.a. - Page 37 Item 11.a. - Page 38 Item 11.a. - Page 39 Item 11.a. - Page 40 Item 11.a. - Page 41 Item 11.a. - Page 42 Item 11.a. - Page 43 Item 11.a. - Page 44 Item 11.a. - Page 45 Item 11.a. - Page 46 Item 11.a. - Page 47 Item 11.a. - Page 48 Item 11.a. - Page 49 Item 11.a. - Page 50 Item 11.a. - Page 51 Item 11.a. - Page 52 Item 11.a. - Page 53 Item 11.a. - Page 54 Item 11.a. - Page 55 Item 11.a. - Page 56 Item 11.a. - Page 57 Item 11.a. - Page 58 Item 11.a. - Page 59 Item 11.a. - Page 60 Item 11.a. - Page 61 Item 11.a. - Page 62 Item 11.a. - Page 63 Item 11.a. - Page 64 Item 11.a. - Page 65 Item 11.a. - Page 66 Item 11.a. - Page 67 Item 11.a. - Page 68 Item 11.a. - Page 69 Item 11.a. - Page 70 Item 11.a. - Page 71 Item 11.a. - Page 72 Item 11.a. - Page 73 Attachment 3Item 11.a. - Page 74 Item 11.a. - Page 75 Item 11.a. - Page 76 Attachment 3Item 11.a. - Page 77 Item 11.a. - Page 78 Item 11.a. - Page 79 Item 11.a. - Page 80 Item 11.a. - Page 81 Item 11.a. - Page 82 Item 11.a. - Page 83 Item 11.a. - Page 84 Item 11.a. - Page 85 Item 11.a. - Page 86 Item 11.a. - Page 87 Item 11.a. - Page 88 Item 11.a. - Page 89 Item 11.a. - Page 90 Item 11.a. - Page 91 Item 11.a. - Page 92 Item 11.a. - Page 93 Item 11.a. - Page 94 Item 11.a. - Page 95 Item 11.a. - Page 96 Item 11.a. - Page 97 Item 11.a. - Page 98 Item 11.a. - Page 99 Item 11.a. - Page 100 Item 11.a. - Page 101 Item 11.a. - Page 102 Item 11.a. - Page 103 Item 11.a. - Page 104 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARROYO GRANDE TO REMAIN A MEMBER AGENCY OF THE SAN LUIS OBISPO COUNTY INTEGRATED WASTE MANAGEMENT AUTHORITY PROVIDED CERTAIN CONDITIONS ARE SATISFIED WHEREAS, the Integrated Waste Management Authority (“IWMA”) is a Joint Powers Authority (“JPA”) comprised of the County of San Luis Obispo (“County”), seven cities (Arroyo Grande, Atascadero, Grover Beach, Morro Bay, Paso Robles, Pismo Beach, and San Luis Obispo), and several special districts (the Avila Beach, California Valley, Cambria, Ground Squirrel Hollow, Heritage Ranch, Los Osos, Nipomo, Oceano, San Miguel, San Simeon, and Templeton Community Services Districts, and the Cayucos Sanitary District) that are represented on the IWMA Board of Directors by one special district appointee; WHEREAS, the IWMA manages, on behalf of its members, hazardous waste, universal waste, solid waste, recycling, and food/green waste and the IWMA is a way for JPA members to pool resources and cost-effectively comply with various solid waste and other regulations including, but not limited to, Senate Bill (SB) 1383, the recently enacted Short Lived Climate Pollutants regulations; WHEREAS, the IWMA staff is responsible for administering over 40 different solid waste programs including household hazardous waste collection, electronics waste collection, and sharps disposal, and many of which require public education and outreach, monitoring, and reporting to the State; and WHEREAS, the City supports the IWMA through payment of solid waste management fees collected from solid waste ratepayers by the City’s waste hauler; and WHEREAS, the IWMA Board of Directors adopted Resolution N0. 21-06-02 on June 9, 2021, increasing the IWMA’s solid waste management fees to address the increased costs associated with SB 1383 and establishing an effective date of October 1, 2021, which the Board of Directors subsequently delayed until January 1, 2022; and WHEREAS, the IWMA is presently helping all member agencies comply with SB 1383, which is the most significant change to solid waste regulations in 30 years. SB 1383 requires jurisdictions to implement an organic waste diversion program that includes providing organic waste collection services to businesses and residences, edible food recovery goals, public education and outreach, contamination monitoring and sampling activities, recordkeeping and reporting, organic and edible food recovery, infrastructure capacity planning, procurement of recovered organic waste products and enforcement; and WHEREAS, the County commissioned a third-party study of costs for the County to withdraw from the IWMA and independently fulfill all essential functions of the IWMA, which concluded, as presented to the County Board of Supervisors in August 2021, that five new full- Attachment 5 Item 11.a. - Page 105 RESOLUTION NO. PAGE 2 time positions and multiple programs would be needed and would result in additional costs to the County of $1.6 million to $2.1 million per year. To cover these projected cost increases, the County would need to immediately increase solid waste rates by 10% to 12% for residents in unincorporated areas; and WHEREAS, on August 10, 2021, the County Board of Supervisors held a hearing to decide whether to withdraw from the IWMA. The County Board of Supervisors voted to withdraw from the IWMA and implement an independent County solid waste compliance program; and WHEREAS, the County’s financial and program analysis and subsequent August 10, 2021 decision to withdraw did not include policy analysis or consideration regarding how withdrawal would financially impact remaining JPA member rates; and WHEREAS, on September 14, 2021, the County Board of Supervisors passed a resolution to formally notify the IWMA of its intent to withdraw on November 15, 2021. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Arroyo Grande does hereby declare, determine, and order as follows: SECTION 1. The foregoing Recitals are true, correct and are incorporated herein. SECTION 2. The City hereby declares its intent to remain a member agency of the San Luis Obispo County Integrated Waste Management Authority (IWMA) subject to the following conditions: a) The IWMA Joint Powers Agreement shall be revised, following consultation with the City Manager and City Attorney, to address the following: i) Remove the five County Supervisors as board members of the IWMA effective immediately; and ii) Remove the eight-member voting provision stated in Section 8.5; and iii) Alter the notice requirement contained in Section 13.2 to require at least six months’ notice to the IWMA in the event that a member intends to withdraw from the IWMA; and iv) Add a provision to the Agreement which clearly and directly limits the IWMA’s ability to adopt, impose, or implement any rule, regulation, policy, or ordinance in excess of the State requirements. b) The revised JPA Agreement must be fully executed as soon as possible. c) The IWMA must also take the following actions: i. Begin recruitment and diligently pursue hiring a permanent Executive Director as soon as practical; and Item 11.a. - Page 106 RESOLUTION NO. PAGE 3 ii. Hire a third-party firm with solid waste management expertise to analyze fees, staffing structures and make recommendations for any programs and services that are not required by, or are in excess of, State solid waste regulations. The report shall identify potential cost saving measures and the IWMA Board shall review and implement those recommendations to reduce costs and minimize expenses. The report must be reviewed by the managers of the IWMA’s member agencies before it is finalized and implemented; and iii. Provide all information necessary to support the adoption of fees that meet all applicable legal requirements, including any information needed by the member agencies to implement the IWMA’s fees as determined through coordination with the managers of the member agencies; and iv. Rescind IWMA Resolution No. 21-06-02 and coordinate with the member agencies’ managers before adopting any other increases to the IWMA’s fees. d) The City intends to continue evaluating the cost-effectiveness of remaining a member of the IWMA as compared to its other options, such as contracting with another agency for its waste management regulatory services or developing its own program to meet its regulatory requirements, and reserves its right to withdraw from the IWMA in the future. SECTION 3. This Resolution shall take effect immediately upon adoption. The City Manager or their designee is directed to promptly deliver this adopted Resolution to the IWMA’s Interim Executive Director and Executive Committee. On motion of Council Member , seconded by Council Member , and by the following roll call vote, to wit: AYES: NOES: ABSENT: the foregoing Resolution was passed and adopted this 9th day of November, 2021. Item 11.a. - Page 107 RESOLUTION NO. PAGE 4 ____________________________ CAREN RAY RUSSOM, MAYOR ATTEST: ___ JESSICA MATSON, CITY CLERK APPROVED AS TO CONTENT: __________________________________ WHITNEY MCDONALD, CITY MANAGER APPROVED AS TO FORM: ___________________________________ TIMOTHY J. CARMEL, CITY ATTORNEY Item 11.a. - Page 108