Title
Intergovernmental Agreement with City of Peoria to Accept and Process Recyclable Materials (Ordinance S-50513)
Description
Request to authorize the City Manager, or his designee, to enter into an Intergovernmental Agreement (IGA) with the City of Peoria to accept and process recyclable materials collected in the City of Peoria and delivered to the City of Phoenix's Material Recovery Facilities (MRF). Additionally, request the City Council to grant an exception pursuant to Phoenix City Code section 42-20(B) to authorize inclusion of mutual indemnification language that otherwise would be prohibited by Phoenix City Code section 42-18(A) and (B). Further request authorization for the City Treasurer to accept, and for the City Controller to disburse, all funds related to this item.
Report
Summary
The City of Peoria has requested to enter into an IGA with the City of Phoenix to accept and process its recyclable material. The City of Phoenix can accept these materials with terms to address changing market conditions, resulting in lower commodity prices and increased processing costs from contamination in the recyclables. This IGA will authorize the City of Phoenix to charge a processing fee to the City of Peoria for recycling tonnage processed at the City's MRFs, which is designed to ensure all costs associated with processing recyclables are recovered by the fee. The terms of this IGA include:
- In a market with low recycling commodity prices, the City of Phoenix will charge a processing fee to the City of Peoria, and no revenue share to Peoria will be available.
- In a market with high recycling commodity prices, the City of Peoria will pay a processing fee and will receive 50 percent of the net revenue share and the City of Phoenix will receive the remaining 50 percent.
Annually, the City of Peoria will deliver up to 20,000 tons of recyclable materials to the City's MRFs.
Contract Term
The one-year term of this IGA will begin on or about Jan. 1, 2024 and conclude on or about Dec. 31, 2024. Provisions of the IGA include four, one-year options to extend the agreement.
Financial Impact
The City of Peoria will be paying City of Phoenix to accept recyclables to cover all expenses associated with proper handling of the materials. If recycle market prices increase during the term of the agreement, Phoenix and Peoria would share the additional revenue at a 50/50 split.
Location
North Gateway Material Recovery Facility, 30205 N. Black Canyon Hwy.
27th Avenue Material Recovery Facility, 3060 S. 27th Ave.
Council Districts: 2 and 7
Department
Responsible Department
This item is submitted by Deputy City Manager Mario Paniagua and the Public Works Department.