Sec. 382.308. - Contract provisions; exemption from Purchasing Code; extension of contracts.

Every contract awarded by the City pursuant to this Chapter shall be exempt from Part 2 of the Purchasing Code and shall include at least the following provisions and conditions: (a) Term. The contract shall commence on January 1 and be effective for a period of six years unless extended pursuant to the provisions of subsection (l) of this Section, except that a contract may be issued for a lesser period if necessary to effect a common expiration date of all outstanding contracts or if the City elects to serve the area of operation directly by City forces. Each contract may be reviewed by the Council through a public hearing to be held by a committee of the Council designated by the Council in the same manner as set forth in Section 382.306 and consider the same criteria as set forth in Section 382.307 (b) after October 1 of the second year of the contract. Following its review, the Council may recommend to the Mayor that he elect to terminate the contract. (b) Transferability. (1) No contract may be sold, assigned or transferred to another by the contractor named therein, nor shall any person cause or permit the transfer of stock control of a corporate contractor unless approved by the Council. The transferor and transferee shall jointly file an application for a transfer, in the same form as required for an application for the original contract, together with the details of the proposed transaction, including consideration, method of payment, effective date of the transfer and other pertinent facts required by the Council. The Council shall approve or disapprove the transfer in the same manner and based upon the same criteria as apply to the original award of a contract under Sections 382.306 and 382.307 . A transferee shall agree to comply with, assume and perform all liabilities, obligations, conditions and standards imposed by the contract upon the transferor. No consideration paid by a transferee to a transferor, allocable solely to contract rights, shall ever be recognized by the City for purposes of determining compensation to a contractor. (2) No contractor owned or controlled in any manner by a person having an ownership interest in or control of more than one other contractor which has been awarded a contract pursuant to this Chapter shall receive a contract by sale, assignment or transfer. (c) Standard of service. The contractor shall agree to comply with all of the standards of service prescribed by law, as they may be amended from time to time throughout the term of the contract in the exercise of the City's police power. (d) Insurance. (1) The contractor shall carry at his own expense a comprehensive automobile and general liability insurance policy issued by an insurance company authorized to write liability insurance in this State, having a B rating or better from Alfred M. Best Company, and possessed of a certificate duly issued by the State Insurance Commissioner or some other officer as may from time to time be designated by the laws of the State, in an amount of not less than $100,000 for each person for bodily injury, sickness or disease, including death resulting therefrom, $300,000 for each occurrence and $25,000 for all property damages in any one occurrence for each vehicle owned, operated, driven or controlled by the contractor, which vehicle is being utilized for the collection of refuse, and all operations necessary or incidental to the operators under the contract and owner of the contract. The policy may be in the form of a separate policy covering all vehicles operated by the contractor in furtherance of waste collection, in which latter event the policy shall provide insurance on each vehicle in the amounts required in this paragraph. The policy or policies shall include an endorsement to the effect that it or they cannot be canceled for any cause without notice of cancellation being served upon the Director of Solid Waste and Resource Management and the Office of General Counsel at least 30 days prior to the date of cancellation. The policy or policies shall be in the generally accepted form used in this State for liability insurance companies for public liability policies and shall further provide that the insolvency or bankruptcy of the assured shall not relieve the company from the payment of damage for injuries or death sustained or loss occasioned within the provisions of the policy; and that the prepayment of any judgment that may be recovered against the assured upon any claims covered by the policy shall not be a condition precedent to any right of action against a company upon the policy, but that the company shall be bound to the extent of its liability under the policy, shall pay and satisfy the judgment by the injured person, or his heirs or personal representative, as the case may be, to enforce the liability of the company as therein set forth. (2) At least 45 days before the expiration of an existing policy, a renewal policy shall be filed with the Director of Solid Waste and Resource Management, and the Office of General Counsel shall approve or reject the policy as to form and as to sufficiency. The filing of a policy shall not constitute compliance with this Section until the policy has been approved by the Office of General Counsel. The contractor shall agree not to drive or operate any vehicle for the purpose of collection of garbage or solid waste until the policy governing it is provided. (e) Performance bond. (1) The contractor shall furnish and maintain on file with the Chief an annual performance bond in the amount of $150,000 for his service areas in a form approved by the Office of General Counsel and payable to the City guaranteeing the faithful performance of the contractor's obligations under the contract. Notice of the filing of the bond shall be reported to the Council by the Director of Solid Waste and Resource Management. The performance bond shall automatically be renewed annually unless the surety thereon gives the Director of Solid Waste and Resource Management written notice of nonrenewal not less than 120 days prior to the expiration date of the bond. The performance bond shall be subject to cancellation by the surety at any time upon giving 120 days' prior written notice to the City of cancellation. Upon notice by the surety of nonrenewal or of cancellation, the contractor shall furnish to the Director of Solid Waste and Resource Management a performance bond conditioned in accordance with this subsection not less than 90 days prior to the expiration or cancellation of the bond then in effect. In the event that the contractor fails to furnish the new performance bond within the prescribed time period, the contract shall be voidable by the City, effective on or after the expiration or cancellation date of the bond then in effect. The performance bond shall be conditioned that the contractor shall well and faithfully observe, fulfill and perform according to his contract and the requirements of this Chapter and that, in the event of a failure to do so on the part of the contractor, the amount thereof shall be recoverable by the City for all damages proximately resulting from the failure of the contractor well and faithfully to perform according to the conditions of the bond. (2) In lieu of providing a performance bond pursuant to subsection (e)(1) of this Section, the contractor may deposit with the Treasurer the sum prescribed by subsection (e)(1) of this Section in cash, in one or more time certificates of deposit, in United States government securities or in an irrevocable letter of credit valid during the entire term of the contract. The Treasurer shall hold the deposit in trust as security for the faithful performance of the contractor's obligations under the contract, and shall return the deposit to the contractor at the expiration of the contract or, upon direction by the Council shall apply the deposit to the City from time to time for damages proximately resulting from a breach of contract by the contractor. If any portion of the deposit is applied to the City for damages, the contractor shall replenish the deposit to the full amount within 30 days after requested by the Director of Solid Waste and Resource Management. (f) Filing of route list and notice of changes. The contractor shall file with the Director of Solid Waste and Resource Management and keep current a list of routes for residential waste collection services, designating routes for residential waste except trash and routes for trash separately, together with a map of those routes, which list shall specify the days of pickup for residential waste except trash on each route and the days of pickup for trash on each route. The contractor shall not make any changes in the days of pickup for its routes on file with the Director of Solid Waste and Resource Management unless and until the Director of Solid Waste and Resource Management has approved the change and each residential premises affected by any the change has received at least five days' prior notice of the change by publication one time in a newspaper of general circulation in the City. (g) Uniform accounting system; fiscal year. The contractor shall keep his accounting records and books according to a uniform chart of accounts and the accounting system prescribed by the Director of Solid Waste and Resource Management. (h) Certified financial statement. The contractor shall furnish the Director of Solid Waste and Resource Management with a certified annual financial statement, prepared by a duly licensed independent certified public accountant, containing an unqualified opinion, within 60 days after the expiration of the twelve-month period ending September 30 within the contract period. The statement shall be prepared in the form as to fully disclose the income and expenses properly chargeable to the contracted waste collection and disposal services as a separate operating entity, and in the uniform accounting format required by the Director of Solid Waste and Resource Management. (i) Disposal of waste. The contractor shall dispose of residential waste in a sanitary landfill or other disposal facility operated by the City. (j) Remedies for breach of contract. The Council shall serve as a review and enforcement body to ensure that the contractor fulfills all the obligations of the contract. Upon request by the Council, the contractor agrees to appear before the Council to promptly respond to any complaint filed before the Council. The following remedies are available: (1) If the contractor fails to provide residential collection service on the regularly scheduled day in any part of his service area, then in that event the Director of Solid Waste and Resource Management may elect to remedy the breach as he deems most appropriate. The actual cost expended by the City to remedy the breach shall be deducted from the next monthly payment to the contractor. (2) After proper notice and hearing upon finding by the Council of a continual or substantial breach of contract, the Council may recommend to the Mayor that he elect to terminate the contract and to provide residential waste collection services in the contractor's service area for the remainder of the contract, either by City forces or by contract with another, in which event the contractor agrees to pay to the City as damages the excess of the City's cost of providing the service over the compensation which would have been due to the contractor pursuant to the contract. (3) If the contractor commingles nonapproved commercial solid waste or nonapproved multifamily solid waste with residential solid waste and attempts to dispose of such nonapproved commercial or multifamily solid waste as residential waste, the contractor shall be in substantial breach of the contract. Such substantial breach shall be disposed of in the manner provided in subsection (j)(2) of this Section. For purposes of this subsection (3), the terms nonapproved multifamily solid waste and nonapproved commercial solid waste shall mean solid waste generated by multifamily residential and commercial customers in excess of limitations specified in Section 382.402 (a); and which solid waste has not been permitted by the Director of Solid Waste and Resource Management under Section 382.402 (c). (4) In lieu of or in addition to any of the foregoing remedies, the Council may direct the Office of General Counsel to institute appropriate proceedings before the appropriate court for violation of any ordinance of the City by the contractor; or to recover damages arising from a breach of contract or other acts by the contractor. (k) Method of payment. Compensation shall be payable to the contractor in monthly installments within ten days after the end of the month for which service was provided in the following manner: (1) The method of computing the monthly contract compensation for payment by the City to the contractors shall provide for compensation based upon the actual number of premises to receive service each month as determined by the Director of Solid Waste and Resource Management and computed in accordance with the following procedure: (i) The number of residential premises in each service area to receive service beginning January 1 of each year shall serve as the basis for computation of the monthly contract compensation to each contractor for the month of January. (ii) The Director of Solid Waste and Resource Management shall determine the number of residential construction and mobile home move-on permits issued by the City each month for each service area. (iii) New residential premises shall be added each month to the initial number of premises to receive service on January 1 of each year only after the allowance for a 60-day construction period following the end of the month in which the construction or mobile home move-on permit is issued for the new premises. (iv) Monthly contract compensation for service provided to residential premises shall be computed for each contractor's service area based upon the total number of residential premises to receive service during the month multiplied by one-twelfth of the rate of contract compensation for each residential premises. (v) Monthly contract compensation for service provided to commercial and multifamily residential premises during the month shall be computed for each service area based upon the total number of the premises receiving service multiplied by one-twelfth of the rate of contract compensation for each residential premises. (vi) Contractors shall be compensated an administrative cost reimbursement charge in the amount of $2.50 for each new commercial or multifamily residential premises to initiate and receive collection service during the month. (2) Payment shall not be made by the Director of Finance and Administration if he receives a certification from the Director of Solid Waste and Resource Management that the contractor is in default under the contract and that payment should be withheld or, if the contractor has defaulted and the City has not terminated the contract, that the City's cost of remedying the breach, in the amount determined by the Council, should be deducted from the payment to be made, in which event only the net amount after the deduction shall be paid. No withheld payment or part thereof shall be released by the Director of Finance and Administration until authorized to do so by the Director of Solid Waste and Resource Management. (l) Extension of contract. (1) Requirements for extension. A contract for a term of six years in force on October 1, 1977, and on October 1 of each sixth year thereafter may be extended for an additional term of six years if the contractor meets all criteria for award of new contracts provided in Section 382.307 (b) and properly applies to the Council for an extension of his contract. (2) Procedure for extension of contracts. (i) A contractor seeking an extension of his current contract shall submit an application for extension in the same form and manner as provided for new applicants under Sections 382.304 and 382.305 during the month of November and no later than November 30 of the fifth year of the term of the current contract. Applications for extension not received by November 30 of the fifth year of the term of a current contract shall not be considered by the Council. (ii) The Council shall hold a public hearing on the extension of contracts for which applications have been submitted in accordance with this Section during the first calendar quarter of the sixth year of the term of the contracts and shall adopt resolutions granting or denying each extension no later than February 28 of the sixth year of the term of the current contract. In considering the extension of contracts, the Council shall consider the criteria stated in Section 382.307 (b) except as is provided in subsection (l)(2)(iii) of this Section. (iii) Rates of compensation and adjustment of service areas will continue to be fixed under the procedures provided in Sections 382.302 and 382.309 , and shall not be considered in proceedings on extension of contracts. (Ord. 76-728-373, § 7; Ord. 76-744-659, § 2; Ord. 77-830-499, § 7; Ord. 78-129-5, § 1; Ord. 78-354-160, § 1; Ord. 78-355-161, § 1; Ord. 82-832-412, § 1; Ord. 83-591-400, § 1; Ord. 86-1305-736, § 3; Ord. 88-835-443, § 3; Ord. 90-286-97, § 2; Ord. 2016-140-E , § 16) Editor's note— Ordinance 2007-839-E, § 18, authorized updated department/division names pursuant to reorganization. Note— Former § 617.308.