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South Valley Disposal - 1984 Franchise Agreement ,. '...: .~ , .., .... AGREEMENT THIS AGREEMENT, made and entered into this 19th day of Harch , 1984, by and between the CITY OF GILROY, a municipal corporation, in the County of Santa Clara, State of California, hereinafter designated as "CITY", Party of the First Part, and SOUTH VALLEY REFUSE DISPOSAL, INC., a California corporation, Party of the Second Part, hereinafter sometimes designated as "CONTRACTOR." WIT N E SSE T H: That Whereas, the parties hereto have heretofore entered into an agreement or contract by the provisions of which the party of the second part has the exclusive right, priviliege, franchise and obligation to collect, transport and dispose of the garbage and refuse produced in the City of Gilroy; and \~hereas, the CITY regulates the collection and disposal of garbage, refuse and waste matter to protect the physical health and safety of its inhabitants; and Whereas,the CITY has exanimed and found the performance and services provided by CONTRACT to inhabitants of CITY under an agreement since December 12, 1969, to have been satisfactory; and Whereas, the City Council of CITY hereby determines that the public interest and convenience and the physical health and safety of its in- habitants require the entering into of the within agreement; and Whereas, the CITY and CONTRACTOR desire to enter into a new agree- ment providing continuation by CONTPACTOR of the collection and disposal of solid waste matter accumulated in the City of Gilroy; and Whereas, the said agreement will expire on the 12th day of December, 1984, and the parties hereto desire to renew the said agreement as of that date and provide for the mutual rights and obligations of the parties hereto thereunder. NOW THEREFORE, IT IS AGREED by and between the parties hereto as follows: I. That the said CONTPACTOR shall have and is hereby given the exclusive right, privilege and franchise of collecting the garbage and refuse as the said terms are defined in Section 12.1 of the Gilroy City Code, and all offal and debris, produced and accumulated, for the period of twenty (20) years from and after the 12th day of December, 1984, subject to the right of CITY to terminate the said rights of CONTRACTOR for breach of this agreement as hereinafter provided. II. During the fifth, tenth and fifteenth years, respectively, of the term of this agreement, an audit of the performance of CONTRACTOR (herein called the "Performance Audit") shall be conducted as set forth as follows: A. The performance audit shall: 1. be performed by a qualified firm to be selected by CITY. 2. be totally paid for by CONTRACTOR as part of its operating costs; and 3. address all appropriate areas including, but not limited -1- ; . '. J.. ~ . to the following areas and shall provide specific recommendations for improvement in each area, namely: a. Overall organizational structure and management systems and procedures. b. Efficiency of collection operations, including any analysis of routes, schedules and the impact of franchise requirements. c. Staffing practices, including the deployment of management and supervisory personnel. d. Financial management practices, including the CONTRACTOR's billing and collection system and its policies with regard to uncollected accounts. e. Personnel management practices, including compensa- tion policies and the resolution of employee grievances. f. Procedures for receiving and resolving customer complaints and concerns, including damage to customer-owned containers and disappearance of container covers. g. Procedures for the acquisition, maintenance and replacement of equipment, types of equipment, rationale for recent capital investments, and financing options. h. Utilization and management of facilities. B. If after the City Council of CITY has reviewed a particular Performance Audit and has considered any evidence presented by CONTRACTOR in connection therewith, the Council determines to its satisfaction that all covenants, provisions, terms, and conditions of this Agreement on the part of CONTRACTOR to be performed, kept and observed, have not been fully and faithfully performed, kept and observed, then this Agreement may be terminated by CITY at its option and without prejudice to any other remedy to which it may be entitled to either at law, in equity, or under this Agreement by giving written notice of termination either by mail or personal service to CONTRACTOR not less than thirty (30) days prior to the date upon which the termination is to become effective. This right of termination shall be in addition to the right of CITY to terminate this Agreement under the provisions of Section X hereof. C. In connection, with the review of a particular Performance Audit, CITY reserves the right to propose any amendment or amendments of this Agreement which the City Council of CITY determines to be necessary by reason of the findings or results of the Performance Audit to carry out the intent of the terms and conditions of this Agreement. III. That CONTRACTOR agrees to use its best endeavors to make collection of the said garbage and refuse in accordance with the provisions of Articles 1 and 2 of Chapter 12 of the Gilroy City Code, and to perform the obligation of making the said collection diligently and systemati- cally, and to provide the necessary equipment therefor. -2- ," , i ,...~. .~' IV. The rates to be charged by CONTRACTOR for making the said collections of garbage and refuse, including garden refuse, shall be fixed by Council resolution. V. CONTRACTOR, without any cost to CITY for such use, shall dispose of the garbage and refuse collected under the provisions of this Agreement in the landfill area owned by CONTRACTOR, east of Pacheco Pass Road opposite the intersection therewith of Bloomfield Avenue. If CONTRACTOR decides to sell the permitted landfill, CONTRACTOR grants to CITY exclusive first right of refusal to match any bona fide offer to purchase within 60 days of offer. VI. CONTRACTOR also agrees, as a part of the consideration for the awarding to it of the right, franchise and privilege for collecting garbage in the City of Gilroy, to collect for CITY, without any charge, refuse from all CITY premises, buildings and installations, including but not limited to the Library, City Parks, City garbage cans, if any, along City streets, municipal buildings, and the City Hall building. VII. The parties hereto do further agree that CITY shall make the collections for the garbage, refuse and rubbish disposal services per- formed by CONTRACTOR and, as a part of CITY's collection system, it shall bill monthly, as a separate item on the usual CITY's utility bill or statement, a charge for all garbage, refuse and rubbish service per- formed by CONTRACTOR, and as the garbage, refuse and rubbish service collections are received by CITY, it shall deposit the same with other CITY funds and, by the 10th day of each month, issue its check to CON- TRACTOR for all money collected for the garbage collection service during the previous month. VIII. CONTRACTOR further agrees that on or before the 10th of each month, it will pay to CITY ten percent (10%) of all collections made by CITY during the previous month for said garbage collections made by CONTRACTOR. It further agrees that it will inform the Collection Divi- sion of the Department of Finance of the CITY of all billings for special customer services performed by CONTRACTOR prior to the 20th day of the month so that these may be billed by the 1st of the following month, and call at the CITY administrative offices daily to obtain information on requests for garbage disposal service or discontinuances thereof. CONTRACTOR shall furthermore investigate all complaints on garbage, refuse, and other collection services and inform the Collection Division of the CITY of the disposition of each complaint. If, by mutual agree- ment of both parties, CONTRACTOR bills and collects any or all charges, CONTRACTOR will remit to CITY five percent (5%) of gross dollars collected. IX. It is agreed that CITY will not be held responsible for any unpaid accounts for the garbage, refuse, and other collection services rendered by the party of the second part. X. Should CONTRACTOR fail, refuse, or neglect to provide satis- factory service or equipment in the making of the garbage and refuse collections provided for in this Agreement, CITY may, at its option, terminate this Agreement after giving thirty (30) days' notice. -3- . . . ., :' ,,"", .. .. < , . I< ,..~. f'..~" . , . XI. CONTRACTOR agrees that it will not transfer or assign any right or privilege arising out of this Agreement or its interest in the Agreement, nor will any party transfer his interest therein without written consent of CITY being first obtained. However, CONTRACTOR may sub-contract certain areas of refuse collection, if written consent is granted by CITY first. XII. CONTRACTOR agrees to carry, during the life of this Agree- ment, public liability and property damage insurance in the limits of $1,000,000.00 and $1,000,000.00 respectively, with both types of insurance protecting CITY as well as CO~TRACTOR, and CONTRACTOR further agrees to hold CITY harmless from any damage or claims for damage arising out of the operations of CO~TRACTOR in carrying out the provisions of this Agreement or because of non-performance by it of any obligation placed upon it by this Agreement. XIII. In the event of a strike of CONTRACTOR's employees, it is agreed that CITY personnel can be used to provide emergency garbage service. During such period of emergency, CONTRACTOR shall pay to CITY a sum equal to the payroll cost, including all fringe benefits, of all CITY personnel so employed, plus an additional ten percent (10%) thereof to defray administrative costs. XIV. It is understood and agreed that this present Agreement supercedes the Agreements heretofore made between CITY and CONTRACTOR relating to the collection and disposal of garbage, debris and other matter to be collected by CONTRACTOR, and that this Agreement is intended to cover the full understanding of the parties to the contract. XV. All rights, legal title, and interest in and to all solid waste from all sources within the service area shall be passed to CON- TRACTOR upon collection and transportation of the waste. CONTRACTOR will utilize their best efforts to implement and maintain waste recovery or recycling programs. CONTRACTOR shall have the first right and option and right of first refusal for the recycling of any type of material in CONTRACTOR's service area. However, if CONTRACTOR chooses not to recycle a type of material which CITY deems recyclable, CITY may, at its option, cause or implement independent recycling programs to handle said waste. XVI. CONTRACTOR shall provide unlimited pickup service for resi- dences, and there shall be no charge for solid waste hauling for the CITY sponsored once a year Spring Clean Up Day. XVII. Disaster Assistance A. In the event of wartime, natural, physical or other disaster in or proximate to the city limits resulting in the declara- tion of a State of Emergency by the duly authorized authority or City Council, CONTRACTOR shall make available to CITY, at no cost to CITY, all trucks, equipment and personnel normally performing services under this Agreement, for emergency operations conducted or directed by CITY's emergencyorganiza- tion. -4- ..,.. ., . .' .,. ~ >. B. CITY shall have the right to take possession of all such equipment provided by CONTRACTOR and to temporarily employ all CONTRACTOR's personnel so provided as emergency operation forces of CITY, under the direction and control of CITY's disaster operation chief. C. CONTRACTOR shall make available, in addition to the equipment and personnel above, equipment and personnel from those CONTRACTOR operations and resources not serving CITY, to the extent necessary to conduct effective refuse, waste and debris removal during any declared State of Emergency to the specifi- cations of the Disaster Operations Chief. IN WITNESS WHEREOF, the parties hereto have hereunto set their hands the day and year first above written. ~ By: !t.J/1L -5-