DATE: February 06, 2024
TO: Board of Supervisors
SUBMITTED BY: Steven White, Director
Department of Public Works and Planning
SUBJECT: Proposed Assignment of Exclusive Service
RECOMMENDED ACTION(S):
TITLE
1. Authorize Chairman to execute cConsent to the assignment of Exclusive Service Area Program Agreement No. 17-565 with Granite Solid Waste to Mid Valley Disposal; and
2. Authorize Chairman to execute cConsent to the assignment of Shaver Lake Transfer Station Agreement No. 10-390 with Granite Solid Waste to Mid Valley Disposal
REPORT
On October 31, 2017, the Board approved and executed agreements with 8 Exclusive Service Area Program (ESAP) haulers. The agreements provide for several types of assignments, including the sale of one hauler’s assets to another. Granite Solid Waste, Inc. (herein after “Granite”), one of the County’s ESAP haulers, requests the County of Fresno’s (County) consent to sell its assets to Mid Valley Disposal, LLC, (herein after “Mid Valley”), including its ESAP Agreement 17-565. Department of Public Works and Planning (Department) staff has assessed the required information submitted by Granite and Mid Valley and found that both parties have satisfied the requirements enumerated in Section 11.5.C of the ESAP Agreement.
On July 13, 2010, the Board approved and executed Agreement 10-390 with Granite Solid Waste, Inc. for the operation of Shaver Lake Transfer Station. Agreement 10-390 provides that assignment of the agreement may occur with prior written consent of both the County and the Operator. Granite Solid Waste, Inc, has requested the County’s consent to assign Agreement 10-390 to Mid Valley Disposal, LLC.
Both agreements pertain to services rendered to residents and businesses within District 5.
ALTERNATIVE ACTION(S):
The Board could choose not to approve the recommended assignments. Granite has indicated that it intends to cease all operations in early 2024. The provision of ESAP services in Granite’s area would be adversely affected if the assignments are not approved.
FISCAL IMPACT:
There are no net County costs associated with the recommended action. ESAP service rates would not increase as a result of the recommended assignments, since Mid Valley would be required to charge no more than the current Board-approved maximum service rates. Mid Valley has provided a $7,000 deposit to cover costs associated with reviewing and processing the proposed assignments.
DISCUSSION:
Granite has been providing solid waste collection services throughout the northeastern area of the County, as depicted in Exhibit A since 2006. Granite currently administers over 2,200 ESAP residential and commercial accounts. Granite has also provided solid waste transfer station operations since 2010.
Mid Valley Disposal provides waste collection, transfer, recycling, resource recovery, and disposal services to residential, municipal, and commercial customers in the five counties within Central Valley. As one of the ESAP haulers, Mid Valley Disposal provides services to approximately 7,000 residential and commercial customers in the urban, southwestern, and eastern areas of the County.
The ESAP agreements provide for several types of assignments, and the proposed assignment entails the sale of Granite’s assets to Mid Valley. This action would result in Mid Valley providing ESAP services in Granite’s exclusive service area. Such an assignment requires County consent and, if the Board should support this action, Mid Valley would take over Granite’s obligations under the ESAP.
Based on the size of Mid Valley’s current customer base, this company may be classified as a large-sized ESAP hauler. Department staff reviewed Mid Valley’s prepared financial statements for 2018 through 2022 and found no data to indicate that Mid Valley would be unable to satisfy solid waste handling services for customers currently served by Granite. Staff has not received any information regarding citations or other censure due to infractions related to Federal, State, or local environmental laws. It is also believed that the size of Mid Valley’s solid waste collection fleet and number of employees adequately provides for current and projected workloads.
The Department also recommends approval of the assignment of Agreement 10-390 to Mid Valley, for operation of the Shaver Lake Transfer Station. Mid Valley currently operates a variety of fully permitted and compliant facilities throughout Fresno County, including large and limited volume transfer stations, as well as a large volume material recovery facility.
Assignment of Agreement 17-565:
If the Board should support the recommended action, staff would oversee the transition of services between the two haulers and ensure that Granite’s customers are given written notice of the change in ownership. Staff would also make the requisite changes to the ESAP map on the County’s website reflecting Mid Valley’s assumption of Granite’s contractual duties under Agreement No. 17-565 and all subsequent amendments, pursuant to the assignment, and inform other ESAP haulers of this action.
Assignment of Agreement 10-390:
If the Board should support the recommended action, staff would oversee the transition of services between the two haulers during assumption of Granite’s contractual duties under Agreement No. 10-390 and all subsequent amendments.
ATTACHMENTS INCLUDED AND/OR ON FILE:
Exhibit A
On file with Clerk - Assignment of Agreement 17-565
On file with Clerk - Assignment of Agreement 10-390
CAO ANALYST:
Salvador Espino