Proposal For Solid Waste Handling Services
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June 18, 2009
Mark Schleich Deputy Director
Resource Recovery & Waste Management 130 E. Victoria St, Suite 100
Santa Barbara, CA 93101
Re: PROPOSAL FOR SOLID WASTE HANDLING SERVICES
Dear Mr. Schleich,
In response to your letter dated April 6, 2009 requesting proposals regarding the County’s solid waste management programs after June 30, 2011 MarBorg Industries has developed the following proposal to provide comprehensive solid waste and recycling services on an exclusive basis in what is now Zone 2 in the County of Santa Barbara by merging this area with our Zone 3 upon the natural expiration of the County’s franchise agreement with Allied Waste/Republic.
I believe that MarBorg Industries is in a unique position to provide the County of Santa Barbara a level and breadth of services that cannot be matched by any other service provider and I look forward to discussing with you in detail the items we have outlined in this proposal.
Sincerely,
Mario A. Borgatello President
MarBorg Industries
cc:
Saud Carbajal, 1st District Supervisor Janet Wolf, 2nd District Supervisor Doreen Farr, 3rd District Supervisor Joni Gray, 4th District Supervisor Joseph Centeno, 5th District Supervisor Scott McGolpin, Public Works Director
CONTENTS
COMPANY PROFILE ...3
PROPOSAL BASIS...4
MAP OF ZONE 2...6
HISTORY OF PERFORMANCE ...7
INVESTMENT IN SUSTAINABILITY...8
INVESTMENT IN DIVERSION ...10
C&D RECYCLING FACILITY...10
DAVID LOVE PLACE RECYCLING CENTER...11
ABOP FACILITIES ...12
INVESTMENT IN COMMUNITY ...13
CONCLUSIONS ...15
ADDITIONAL BENEFITS TO THE COUNTY OF SANTA BARBARA ...16
COMPANY PROFILE
MarBorg Industries is a local, family-owned business which has been serving the South Coast community for over 75 years. The business was started by Mario Borgatello Sr. and Charlie Borgatello as teenagers in the late 1920’s. Their father had passed away when the boys were toddlers, and the family all worked together to make ends meet. Mario and Charlie collected food scraps from homes and businesses to help feed the hogs being raised by their mother. As this practice continued, the boys’ hauling business grew and customers began asking them to take away other trash items.
Recycling has been at the heart of MarBorg since the beginning when Mario and Charlie Borgatello would supply used metal, cotton, nylon, glass and other materials to meet the demand created by the 1930’s depression and the 1940’s war mobilization. They would sort through the trash they collected to recover any item that could be reused. These resourceful practices became the foundation for today’s recycling efforts at MarBorg Industries.
Today, Mario Sr. still comes to the office every day but he has passed the operations of the business to his two sons, Mario Borgatello Jr. and David Borgatello, who serve as the Company’s President and Vice President. In addition, Mario Jr.’s two sons Anthony and Brian Borgatello manage the Liquid Waste and Recycling Divisions respectively, and Mario’s son-in-law Derek Carlson serves as the Company’s Business Manager. David’s daughter Kathy Koeper serves as Executive Assistant to the President and Vice-President. Although the business has grown since the 1920’s it still maintains its comfortable atmosphere and pride of service that can only be found in a family business.
In endeavoring to grow the seeds of recycling and preservation that were planted by Mario and Charlie in the 1930’s, MarBorg has continued to be on the forefront of recycling technology. In 1991 MarBorg began an innovative Construction and Demolition (C&D) recycling program.
Through continued investment and innovation MarBorg has steadily increased the amount of material that they are capable of processing and recycle up to 200,000 tons per year. Because of this continued effort and investment, MarBorg has become the largest private source of recycling for the Cities of Goleta and Santa Barbara, the County of Santa Barbara and UCSB.
MarBorg has also invested heavily in alternative energy. MarBorg has one of the largest solar installations on the South Coast which, on a sunny day, can provide enough power for forty homes. MarBorg is also updating its fleet of collection vehicles with near zero emissions compressed natural gas trucks. These trucks are the first trucks with this engine type to be in use in the County.
The family and staff of MarBorg Industries believe that preserving the environment is their mission and it is their duty to honor their founders by continuing to explore the forefront of environmental technology.
PROPOSAL BASIS
The County of Santa Barbara currently receives solid waste handling services in the unincorporated area between the eastern limits of the City of Santa Barbara and Gaviota from two companies: MarBorg Industries in Zone 3 and Allied Waste/Republic in Zone 2, pursuant to exclusive franchise agreements which began in 1997. In 2002 the City of Goleta incorporated, and as a result the majority of Allied Waste/Republic’s revenue generation in Zone 2 was acquired by the new City of Goleta. Upon the expiration of the franchise agreement with Allied Waste/Republic in Zone 2 we propose that the remaining customers in the County’s trash Zone 2 be incorporated with the customers we serve in Zone 3.
The franchise agreement with MarBorg Industries in Zone 3 has a term extending to the year 2019 assuming certain conditions are satisfied, which MarBorg has already met. MarBorg Industries received the longer-term agreement in recognition of the significant capital investment and financing requirements that were entailed in the construction of the Construction and Demolition Recycling Center, which has facilitated MarBorg Industries to become the largest private source of recycling and waste diversion for the County of Santa Barbara and other communities on the South Coast.
This proposal, which offers tremendous benefits to the County of Santa Barbara, is submitted at a time that strongly favors consolidating franchised haulers. One factor that could reasonably support a determination to reduce the number of haulers operating in this area is recent news that Allied Waste has now merged with Republic Services, an obvious source of concern for municipalities who understandably require and expect continuity of ownership and stability in management and operations from their solid waste service providers. Additionally, the County’s agreement with MarBorg Industries provides that an independent and comprehensive rate review will be performed as a condition of MarBorg’s exercise of its next term extension right.
Expanding the MarBorg franchise to include what’s left of Zone 2 will assure not only uniform service quality and rates, but will also assure that customers will enjoy very favorable rates without incurring the expense, inconvenience or delay of a full-blown RFP.
There are also many legislative reasons to contract with one exclusive hauler. As of this writing, the California Legislature is poised to consider, and may likely adopt, a number of solid waste- related measures, including one (SB 25 by Senator Alex Padilla) that promises to be one of the most comprehensive waste recycling laws enacted since AB 939. This bill will reportedly increase the waste diversion and recycling obligation of every county and city in this State.
At the same time that California municipalities are confronting the challenge of arranging for more waste diversion and recycling, society has also identified climate change as among its key problems in need of attention. California is leading the way, by having adopted the Global Warming Solutions Act in 2006 (AB 32 by then Assembly Speaker Fabian Nunez). This new law sets ambitious goals to reduce emissions of carbon dioxide and other greenhouse gases to 1990 levels by 2020, and to 80% below 1990 levels by 2050.
Under AB 32, local governments will share a part of the burden of reducing greenhouse gas emissions, as will virtually every segment of private industry. It is therefore incumbent upon all jurisdictions, the County of Santa Barbara included, to evaluate and consider how emissions may
be reduced through the implementation of local measures. The League of California Cities and the California State Association of Counties have joined forces to establish the Institute of Local Government’s Climate Action Network for just that reason. They are developing a best practices framework to reduce the municipal carbon “footprint,” and the framework specifically recognizes that waste reduction and recycling activities are a significant contributor to potential savings.
To that extent, the goals of AB 939 and of AB 32 coincide perfectly. The objectives of both laws are served whenever a county can identify ways to improve efficiency, reduce fuel consumption and vehicular traffic, and lessen the environmental impacts associated with waste management and recycling. This same list of benefits is most often cited as justification for exclusive franchising.
Since executing the current contracts in 1997, the County of Santa Barbara has had an opportunity to observe and compare the performance of its two solid waste handling franchisees on the South Coast. While the two do not directly compete for customers, they are indirectly competing every day in that they are held to a uniform set of rules, rates and regulations, and their performance is overseen and administered by the same governing body. In a manner of speaking, the County has been undergoing an independent assessment of these two operators for more than 12 years. Two waste haulers in what’s left of Zone 2 and our surrounding Zone 3 is difficult to justify, particularly in light of the enactment of AB 32. Converting to a single provider system will further reduce vehicular traffic, conserve fuel and simplify contract administration by staff.
MAP OF ZONE 2
The sections highlighted in yellow represent the general areas remaining in Zone 2.
This area is surrounded by regions already serviced by MarBorg Industries.
HISTORY OF PERFORMANCE
Based on the Company’s long track record in this community going back to the early 1930’s, MarBorg Industries believes that when it is compared alongside any other waste management service provider in the country, its record of exceeding expectations and outperforming the competition on all levels is self-evident. MarBorg’s success is largely attributed to its unique approach to the solid waste hauling business. MarBorg is far more than just a solid waste hauling company owning trucks, bins, and cans. MarBorg’s investment in ground-breaking recycling programs and facility development is unmatched in this community. The company’s visionary approach to problem solving has resulted in a number of innovative programs which have contributed significantly to the environmental betterment of Santa Barbara County.
INVESTMENT IN SUSTAINABILITY
MarBorg Industries is committed to the environment, which is evident in the company’s integration of progressive technology. Through integration of modern methodology MarBorg has diversified its resource dependency and has lessened its impact on air quality, thus providing a cleaner environment for the community.
In a move from traditional resources dependence towards more environmentally friendly long lived and sustainable resource production MarBorg Industries invested in a substantial photovoltaic installation atop its various buildings. To date MarBorg has installed over half a million dollars of solar panels at its corporate facilities, creating one of the largest solar installations on the South Coast. Through this installation MarBorg Industries generates enough energy to power 40 homes on a sunny day. This contribution in not only beneficial to the community by
providing renewable energy, but allows MarBorg to be an environmental role model for other businesses in Santa Barbara County.
In addition to integrating renewable energy generation, MarBorg has been positively impacting our local air quality. MarBorg Industries has long enjoyed a very good relationship with the local Air Pollution Control District (APCD) and since 2001 has worked in conjunction with the APCD to voluntarily re-power older vehicles. MarBorg has spent over
$500,000.00 on this voluntary program which benefits the entire community through minimization of potential harmful emissions through modernization of equipment.
Another major step that MarBorg Industries has taken towards sustainability is its updating of the collection fleet with near zero emissions Compressed Natural Gas (CNG) trash trucks in Santa Barbara County. MarBorg already has three near zero emission vehicles providing service in our community and is currently working with the APCD and the Department of Energy to add an additional 16 CNG vehicles to our fleet and
to build the community’s first public access CNG refueling station. To ensure a comprehensive fleet of sustainable collection vehicles, MarBorg Industries is using Bio-Diesel fuel in all of its existing diesel vehicles. Through modernization of older equipment, integration of CNG vehicles, and utilization of cleaner burning fuels MarBorg Industries has proven to be an environmental leader in Santa Barbara County.
INVESTMENT IN DIVERSION
MarBorg Industries has always been the leading recycler of any hauler operating within the County of Santa Barbara. In fact, history demonstrates that where a jurisdiction is served by MarBorg in conjunction with another hauler, MarBorg consistently out-performs the other hauler and provides greater diversion to the jurisdiction.
C&D RECYCLING FACILITY
MarBorg’s innovation in recycling engineering has been observed through its development of its Construction and Demolition recycling facility. In 1996 MarBorg began sorting out usable materials from loads from construction and demolition projects. The success of this recycling strategy was convincing enough for MarBorg Industries to invest over
$15,000,000.00 in developing a one of a kind, state of the art recycling facility that processes over 200,000 tons of material per year. The facility was 100% financed by MarBorg Industries and assists MarBorg in being the largest private source of diversion for the County of Santa Barbara.
DAVID LOVE PLACE RECYCLING CENTER
During the construction of the C&D Recycling Facility in 2004 MarBorg Industries continued to grow its recycling capabilities through the purchase of the CEC Recycling Facility in Goleta, located at 20 David Love Place, where recyclables from commercial customers in the County of Santa Barbara had long been processed. Since acquiring the David Love facility MarBorg Industries has made many upgrades which have positively influenced the company’s ability to divert material from the landfill.
Through innovation and a growing list of items that MarBorg is able to recover, the amount of commercial recyclables processed at this facility has grown year after year.
In addition to processing all of the commercial recyclables for the County at this location MarBorg also operates a Buy Back Center. The Buy Back Center offers the community a convenient local facility to drop off their recyclables and to be paid the CRV (California Redemption Value) for qualifying materials.
ABOP FACILITIES
In 2008 MarBorg Industries dedicated a new ABOP facility at the David Love Place facility to serve the western portion of the South Coast. “ABOP” stands for Antifreeze, Batteries, Oil, and Paint but this facility accepts much more. This facility is a convenient, one- stop location for recycling many common universal waste items. In addition to the items already mentioned the facility accepts fluorescent lights, compact disks, cell phones, computers, televisions, DVD players and other electronics. There is no cost for residential customers to drop off any of these items.
In 2005 MarBorg began operating a sister facility serving the eastern region of the South Coast located at 725 Cacique Street. These facilities are one more step towards meeting their goal of providing the South Coast with safe, effective and convenient recycling and hazardous waste management. It is MarBorg’s sincere hope that these one-stop facilities, open 6 days a week, will motivate local residence to increase their recycling efforts and keep hazardous waste materials out of the community’s landfills and storm drains.
So far, these facilities have been highly effective in diverting hazardous material from the landfills. In 2008 these two facilities accepted the following quantities of materials from customers in the Unincorporated County alone.
MATERIAL QUANTITY
Antifreeze 38 Gallons Monitors/TV’s 6,133 Pounds Dry Cell Batteries 3,228 Pounds Electronic Waste 279 Pounds Florescent Bulbs 861 Feet
Oil 336 Gallons
Oil Filters 15 Units Latex Paint 1,476 Gallons
INVESTMENT IN COMMUNITY
MarBorg Industries is a local family business that has been an active participant in this community for over 75 years. That doesn’t just mean the Company has an office here—the entire business is dependent on serving this community. MarBorg does not answer to Wall Street investors, but to the community and the residents it serves. MarBorg proves this time and again with its continued reinvestment into the recycling infrastructure (facilities and programs) that provide valuable diversion benefits to the community.
MarBorg Industries is committed to supporting the non- profit organizations and schools that serve the community and works every year to help them succeed.
MarBorg has donated millions of dollars in cash and services to ensure that the community is able to enjoy the services that these organizations provide. Also, MarBorg takes care of the community by taking care of its employees and their families. MarBorg understands that uninsured or underinsured individuals are a financial burden for the rest of the community. Accordingly, every employee at MarBorg Industries receives full medical and dental insurance for themselves, their spouse and their entire immediate family at no charge to the employee. MarBorg also understands the burden on the community if individuals can’t support themselves in retirement. Thus, all of the Company’s drivers, helpers, mechanics, equipment operators, and office personnel receive a pension benefit of 8% that is paid by the Company. This 8% benefit is independent of whether or not an employee chooses to contribute any of their own
money to the plan; the money is there for them at retirement.
It is MarBorg’s belief that motivated employees exhibit better work habits, which ultimately benefit the customer. Rather than paying its employees on the basis of a day rate, MarBorg has elected to compensate its employees on an hourly basis, which experience has demonstrated results in better quality work from employees who are not rushing to complete their tasks.
MarBorg also works hard to educate all members of the community on the importance of recycling. MarBorg has an educational program where its representatives go to local classrooms to explain local recycling programs as well as waste management in general. Its educational program includes a combination math and science curriculum for presentation at local schools.
MarBorg understands the importance of providing educational services to the adult community as well. The Company has presented recycling programs to community groups such as Rotary, Kiwanas, and Lions. It has also assisted in developing recycling programs for business groups such as the Rental Property Associations and the Contractors Association to further contribute to diversion in the community.
Additionally, MarBorg provides tours of its recycling facilities to all members of the community.
MarBorg representatives have given tours to elementary school students, Boy and Girl Scouts troops, green building associations, the Contractor Association, University of California Santa Barbara students and professors, and many other interested parties. The Company regularly receives phone calls from community members expressing interest in touring the Construction and Demolition recycling facility and visitors are always welcome.
MarBorg has consistently participated in community outreach by taking part in popular events, and is proud to promote recycling in partnership with many others in the community. Annually MarBorg has sponsored the Community Environmental Council’s Earth Day celebration. These events are great opportunities for MarBorg’s staff to meet with the people they serve in the community. Speaking with the individuals to whom they provide service has proven to be an effective way for them to relay important information about the recycling services they provide.
CONCLUSIONS
MarBorg Industries has a track record of service and innovation going back 75 years in this community and is a true partner in providing environmental solutions. The Company has developed multiple recycling facilities to serve the community at its own cost including its C&D Recycling Center, Commercial Recyclables Processing Center, two ABOP hazardous and universal waste collection centers at each end of the South Coast, and two Buy Back Centers located at the ABOPs. In addition to investing in recycling infrastructure, MarBorg is also dedicated to investment in alternative energy as evidenced by its large solar installations and alternative fuel vehicles.
In light of recent legislative proposals which will require communities to further increase recycling and further reduce pollution, consolidating haulers on the South Coast makes perfect sense. MarBorg makes an ideal partner to assist the County in achieving their goals of increased diversion and reduced pollution based on the Company’s past actions and commitment to investment in this community.
MarBorg looks forward to a long collaborative relationship with the County of Santa Barbara and believes that the additional benefits it is able to offer the County as the excusive hauler on the South Coast will further display the advantages of doing business with MarBorg Industries.
ADDITIONAL BENEFITS TO THE COUNTY OF SANTA BARBARA
1. MarBorg Industries shall reimburse the County of Santa Barbara for the cost of the independent rate review, up to $25,000.00.
2. MarBorg Industries will agree to a contractual link between the services at the New Cuyama and Ventucopa transfer stations that will save the County over $50,000 a year in our new franchise agreement.
3. MarBorg Industries will include a commitment to reserve long-term capacity at the MarBorg C&D recycling facility for the County of Santa Barbara to meet the County’s ever increasing diversion needs.
4. MarBorg will commit to not requiring any future subsidy from the County to provide C&D diversion even during difficult economic times.
5. MarBorg will agree to operate an electronics recycling center and ABOP at the David Love Place facility for the benefit of the residents of the County of Santa Barbara. This will be an increasingly valuable service as consumer electronics continue to be a fast growing part of our waste stream. Similarly, MarBorg shall agree to a contract requirement that its Buy Back Center will be operated throughout the franchise term for the benefit of the County of Santa Barbara’s residents who require access to a local and convenient location to redeem their recyclable materials.
6. MarBorg will agree to operate an additional electronics recycling center, ABOP and Buy Back Center located at 725 Cacique Street for the benefit of the residents of the southern portion of Santa Barbara County.
7. MarBorg will streamline the reporting process to assist staff in meeting State requirements.
8. MarBorg Industries shall commit to meeting the requirements of any new State law that increases the level of diversion expected in the commercial sector.
9. MarBorg Industries shall offer to indemnify the County of Santa Barbara from and against the payment of any fines or penalties imposed under AB 939 or SB 1020 compliance.
10. MarBorg Industries shall provide unlimited collection of the following large items that are inherently difficult to self-haul: White Goods (refrigerators, washers, dryers, water heaters, etc.), Televisions and Computer Monitors.
11. MarBorg Industries is willing to continue a provision included in the contract with the County of Santa Barbara that would provide a substantial financial disincentive regarding any transfer or assignment of the franchise agreement by MarBorg.
12. In addition to providing recycling carts, green cans and carts and trash carts free of charge, MarBorg Industries shall also agree to provide trash cans free of charge to any resident desiring to use them.
13. MarBorg Industries shall provide the County of Santa Barbara free disposal service for automobiles removed by the County as abandoned vehicles.
14. MarBorg Industries shall commit to offer employment, with full seniority, to all qualified Allied Waste drivers and helpers currently servicing the County of Santa Barbara, Zone 2.
15. MarBorg will provide free trash, recycling and green waste service to all public schools in our service areas, thus saving the District tens of thousands of dollars.
16. Finally, if the County is interested in discussing additional terms to our existing franchise agreements MarBorg could provide a cost savings to the County in excess of $175,000 per year by providing free solid waste and recycling services to County parks and facilities.
