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City Council Minutes 2006 10-17-06 Special Meeting F THE SPECIAL MEETING OF THE CITY COUNCIL MINUTES O , OF THE UNITED CITY OF YORKVIL,LE. ]KENDALL COUNTY. ILLINOIS, HELD IN THE CITY COUNCIL CHAMBERS, 800 GAME FARM ROAD ON TUESDAY, OCTOBER 17, 2006. Mayor Prochaska called the meeting to order at 6:30 P.M and led the Council in the Pledge of Allegiance. ROLL CALL Clerk Milschewski called the roll. Ward I James Present Leslie Present Ward Il Burd Present Wolfer Present (arrived at 6:37) Ward III Bock Present Munns Present (arrived at 6:40) Ward IV Besco Present Spears Present Also present: City Clerk Milschewski, City Attorney Wyeth, Interim City Administrator Crois, Assistant City Administrator Olson, Finance Director Mika and Community Development Director Miller. OUORUM A quorum was established. CITY COUNCIL REOUESTS Mayor Prochaska explained that this meeting was called by Aldermen Munns, Spears and Burd for the purpose of having discussion on the Host Agreement. He introduced Attorney Derke Price and Brooke Beal, the authors of the agreement. Attorney Price addressed the City Council and introduced Mr. Beal. He explained that Mr. Beal, who is the Director of the Solid Waste Agency of Northern Cook County and a private consultant to municipalities and counties, is one of his panel of experts who is helping guide the United City of Yorkville in this process. Mr. Beal brings a government view to the process. Attorney Price asked Mr. Beal for his expertise and together they drafted the Host Agreement. Attorney Price stated that he felt that the purpose of this meeting was to be an educational component as to where the United City of Yorkville is in terms of what the Host Agreement has done for the City and where it is about to go. He explained that this is a long process and as of this time, no application has been received. For this process to begin, an application for a landfill needs to be filed with the City so that it is knows what is being proposed. The City then reacts to the application and gathers more information. One of the tasks of the City Council is to evaluate the application and the evidence presented. If the application meets the criteria, the City Council may impose conditions that are tailored to what is presented. He explained that the Host Agreement sets up the opportunity to tailor the application based on public input. The agreement also sets the ground rules which protects the City in the process and sets the general parameters for what the agreement will be and how the parties will approach it if an application is received and if it is approved. Attorney Price stated that he prepared a memorandum dated October 16, 2006 (see attached) which contrasts the City's agreement with that of Kendall County. He explained that both the City and Kendall County have the same goal in mind however two different approaches were taken to protect the quality of life in Kendall County, minimize the negative affects of the process, minimize the negative affects of a landfill and maximize the positive benefits. Attorney _ Price explained that he listened to the City Council's input on recent annexations and developments. He paid attention to what the City Council seemed to value in its planning C process; making a difference to the people who are most affected by development and making public input meaningful. He made these the guiding principals of the agreement; make an immediate difference for the people affected and make room for public input. He explained that he took a governmental approach which is concerned with the day-to-day things. He stated that this approach was taken to Fox Moraine, the potential applicant, who was willing to look at the process in the same way. Attorney Price explained that if a landfill is sited, it is there for twenty years with another thirty years of post - closure; a landfill is a fifty year relationship. He stated that if any relationship is combative it is less efficient and less productive when it comes to getting things done. I i The Minutes of the Regular Meeting 9f the C tv Cou ncil — October 17 2006 — va2e 2 Attorney Price gave an example of the ground water protection program. Both the County and City agreements have a program however they differ dramatically on how they resolve a problem with a well owner. The City's program obligates the landfill operator to provide potable water within twenty -four hours and continue this service until test results indicate the landfill is not the cause of the problem. With Kendall County's agreement, the complainant must first obtain a laboratory analysis that shows the landfill is responsible for the water problem before the operator has to provide a potable water supply. Attorney Price stated that police power has been the big question; has the United City of Yorkville given their police power away? He explained that this power is twofold; it is the authority to regulate as well as the ability to take physical control of persons or property if necessary and the City has not given this power away. He further explained that any landfill must conform to regulations set by the state and federal governments (the Illinois Environmental Protection Agency (IEPA), the Illinois Pollution Control Board, etc.). He stated that the agreement gives the host the right to monitor and audit the operation, books and records of the operator. Because the City does not have the in -house expertise to do this, a safeguard was built in the Host Agreement to provide for reimbursement of the cost. The County's Agreement provides for reimbursement of up to $100,000.00 /year for reasonable costs and the operator has a say in what are reasonable costs. Whereas the City's agreement opts for complete objectivity; the operator has no say in the independent monitoring or the cost involved. The cost is covered by the Host Fees. Attorney Price explained the enforcement of compliance outlined in the agreement. He stated that the City has taken a proactive approach and front loaded the right of the City to take control of a problem and make any changes necessary to resolve it. The City has within 48 hours to notify the operator of any violation reported. The operator then has 72 hours to either fix the problem or give notice that it will take longer to fix it and then give a plan of action. If after the end of five days the City does not like the outcome, it has the right to take control of the situation with its experts and dictate what will happen. The operator will have to pay all the expert and consultant fees needed to resolve the violation and the City will have $10,000.00 on deposit up front to start this process. Attorney Price went on to explain that in the County's agreement, if a complaint is received, the County gives notice to the IEPA and Waste Management and then they wait thirty days for the IEPA to do something. If the IEPA does something in thirty days, the County might not do anything. If the IEPA doesn't act in thirty days, the County has the right to seek an injunction but cannot do so under 5.3 of their agreement until day sixty. They are waiting sixty days before they ask the court for relief. Attorney Price turned the presentation over to Mr. Beal who discussed arbitration. He stated that the County has a full docket and is short judges so getting an injunction is a long process. Arbitration goes before a panel with backgrounds in engineering, environmental science, etc. Arbitrators can come to Yorkville to handle the dispute in a timelier basis. Mr. Beal went over the Host Compensation Fee Comparison chart. Upfront the City has more funds than the County. After that, the city starts to lose ground due to the sharing of funds with other units of government, recycling programs, environmental protection programs, etc. The City's host fee also does not get the escalator of the Consumer Price Index (CPI) because it is set by statute. This impacts the funds the City ultimately gets from a landfill. Mr. Beal explained the Assignment of Rights. Both agreements restrict this without the City's consent. He noted that the County's agreement has a good point which is that any sort of transfer calls for a public hearing. He suggested that this provision be put into the siting conditions. Mr. Beal explained that some items such as an End Use Plan, Traffic Plan, Spill Reimbursement, Truck Tarpmg Plan and Communications cannot be defined until an application is filed and public input is received. -� Mr. Beal and Attorney Price entertained questions or comments. Alderman Burd asked Attorney Price and Mr. Beal to explain how the Host Agreement can be amended. Mr. Beal explained that the Host Agreement can be amended if both parties agree. He stated that the agreement locks down essential terms. He stated that the more that is locked in now, the less the City can affect it with siting conditions. Alderman Burd asked him to explain siting conditions. Mr. Beal stated that if a landfill is sited and meets the criteria, the City Council can apply conditions at this time. This is where the "tailoring" comes into affect. As this meeting was scheduled before a public hearing at 7:00 p.m., it was recommended to adjourn the meeting until a date in the future. Mayor Prochaska recommended the date of Monday, October 30, 2006 at 7:00 p.m. The Minutes of the Regular Meeting of the Citv Council — October 17. 2006 — page 3 ADJOURNMENT Mayor Prochaska entertained a motion to adjoum the meeting until Monday, October 30, 2006 at 7:00 p.m. So moved by Alderman James; seconded by Alderman Wolfer. Motion approved by a roll call vote. Ayes -8 Nays -0 James -aye, Mums -aye, Burd -aye, Spears -aye, Bock -aye, Besco -aye, Leslie -aye, Wolfer -aye Meeting adjourned at 7:00 P.M. i Minutes submitted by: Jacquelyn Milschewski, City Clerk City of Yorkville, Illinois i C I i I SPECIAL CITY COUNCIL MEETING October 17, 2006 PLEASE PRINT NAME: ADDRESS: 6 F e-( 0 rci� - 2 - Z - Z I M i�/7l0 1 2�x /3 ,4/Z/9 X? o U - ) /'1 ,4 A) a l H l k L W c-ZL7 c"7 Yc�eK O I L L& (VLF(VC.1/ SC O T 7 KL) �l Uot 11 Z o �°� h e �° �— f MAk- �0 PiA)6 c7 'l( //!QV- '11e SIGNIN i SPECIAL CITY COUNCIL MEETING October 17, 2006 PLEASE PRINT NAME: ADDRESS: M APW t O Di�- j9z -50 &ik► -E---m �,A -QP K6 A /J 4 e ,�r ��/ ��G�l �l� ' s.�� /./,' a i4 i a� 1 L II i - s/P,n ,1 A to '7 5 3 1 ( QU l r� Prke �.o w� •r y,�r+ �,� I SIGNIN i I II City Clerk Milschewski City Council Packet MEMORANDUM To: John Wyeth From: Derke J. Price Brooke Beal Subject: Education Component #1 Date: October 16, 2006 John: Attached is the first of many -to -come memoranda to educate the City and the public on the process of where we have been and where we are going. In particular, this memo concerns the Host Agreement, what we have committed to, and what we need to be looking for once the application process begins. It does make some comparisons to the County's agreement for the sake of understanding. A graph and table has also been included and should be part of this memo to the Council. Call with any questions. Derke THE YORKVILLE HOST CITY AGREEMENT Focus on Local Impacts Although we recognize you are comfortable with the terms you agreed to, we thought that it would be prudent —as part of the educational component of this lengthy process —to highlight for you the approach we took in the Host Agreement, the consequences of that approach and its importance for you going forward. We also thought it would be useful to contrast that approach (and its results) with that of the County in its Host Agreement with WMI. Our goal in the Host Agreement was to set some rules by which we could minimize the negative impacts of the siting process and, if approved, to set the framework and rules for a 20 -50 year relationship between the City and the landfill operator. We sought to minimize the various negative impacts and maximize those positive I impacts that would become available to the City. Based on our review of your policies and discussions with Staff, we concluded that the Host Agreement should maximize local control, be readily accessible for your constituents, be predictable and stable in achieving an actual result, and most of all be efficient (by which we mean, it would give the City the ability to quickly address any issue, even where the Applicant did not). Further, we have observed first hand the power of public input into the land use process. Accordingly, in both the siting ordinance and in the Host Agreement we sought to maximize the amount of public input and to maximize the actual impact that the public's input would have on the landfill operation or design. A Host Agreement can be a two -edged sword in this regard. A Host Agreement commits the other party to certain standards but it also limits what the City can do by way of imposing further conditions of approval —at least on those items that are already included in the Host Agreement. Thus, the more detailed a Host Agreement is up front, the less flexibility the City would have to impose conditions after listening to the public and the experts. Our goal, therefore, was to commit the Applicant to the core safety, environmental and procedural terms and to leave room for you —the elected officials —to make policy decisions and impose conditions on any approval after you have heard from the public and the experts. We also made the Agreement nimble enough to take advantage of all future advances in science, engineering, technology and best practices. We believe that you must make the sorts of policy decisions that have to be made about any such relationship and not have them made for you by your lawyers. We further believe you should only do so after you receive all of the information. Because of the nature of the process, you cannot have all of the information necessary to make all of the decisions at the time of the Host Agreement. We understand that you look to us for expertise to protect the City. We have done that. But we do not believe that we— simply because we are lawyers and engineers —know precisely how to strike the balance on all the matters of policy that flow from this 1 important process. We will make recommendations, but only after we all see all of the information and evidence from the applicant and the public. While we sought to maximize the speed with which the City could intervene with actual solutions on site (as opposed to relying upon post -hoc/ post judgment penalties to control the Operator's behavior), we also recognized that (if sited) this would be a 50 year relationship. Consequently our approach was to create a relationship in which the City would be vigilant and cautious, but not necessarily adversarial in its dealings. Likewise, we wanted (and we think we obtained) the Operator to commit to an open and professional relationship. Below is a more detailed comparison of the two approaches and their results in the two documents: i 1. POLICE POWER { r Police power is the power or authority to regulate behavior and, where necessary, to assert physical control over persons and things in order to promote the safety, health and welfare of persons and property. The City of Yorkville's Host Agreement Administrative Hearing/Arbitration Approach does NOT relinquish police power; rather, it enhances the City's police power to take physical control quicker and thereby ensure a quicker response time. A. Applicable Regulations: The Standards and Regulations to which the operation of any landfill must conform are set by the State of Illinois through the Environmental Protection Act, the Illinois Pollution Control Board Regulations; the permitting requirements of the Illinois Environmental Protection Agency. If you violate these regulations, you violate the City's Host Agreement and you violate the County's Host Agreement. References: City Host Agreement: Section 6 (permitted waste); Section 7 (Ban on Hazardous Waste) and Section 20: "Fox Moraine, LLC warrants that it will at all times conduct its operations at the Landfill in material compliance with all of the ordinances, laws, rules and regulations of the City, the State of Illinois and the United States of America relevant thereto." County Host Agreement: Article 4 (authorized waste/ ban on waste/ design & operating standards); Article 5 (5.1 same general language) (5.2 listing of current State performance standards ( "the parties acknowledge that the above - referenced Performance Standards are required by the Act, the IPCB regulations and relevant permit requirements that IEPA will issue with respect to the Landfill. ") 2 i B. Monitoring: The Host should have the right to monitor and audit the operations and books and records of the operators. Neither the City nor the County has the in -house expertise to do this and both must retain and use outside consultants to perform this task. Both Host Agreements safeguard this right. References: City Host Agreement: Section 11 (Books and Records anytime, audit with 5 days notice); and Section 19 ( "The City shall have the right to inspect the Landfill at anytime during the Facility's permitted hours of operation. ") County Host Agreement: 4.7 (inspections during hours of operation upon advance telephonic notice/ immediate access for emergencies/ unannounced inspections but advance notice of audits/ contact person at operator to be designated) Note on costs: The County Host Agreement (6.4) does provide for reimbursement by the Operator of up to $100,000 per year for reasonable inspection and monitoring of the operations; however, the Operator has some say over the meaning of "reasonable ". We have recommended and negotiated a completely independent monitoring scheme funded by the Host fees and over which the Operator has no say whatsoever. This "independent approach" is the method used by Lake County, for example, to monitor and inspect the landfills present there. C. Enforcement: The Host must be able to compel compliance. There are many ways that local government attempts to guide behavior and compel compliance with its various laws: one is the prospect of large fines or monetary damages for violation (the approach of the County), another is the power to assume physical control over persons and things to change behavior (the approach taken by the City). This area represents perhaps the biggest difference in the divergent approaches taken by the two units of government. The County has taken an adversarial approach to the Operator and back - loaded the consequences for proven failures. The City has taken a more proactive business relationship approach to the Operator and front loaded the right of the City to take control of a problem and make such physical changes as are necessary to correct a problem. More specifically, the State's regulatory framework will oversee the major issues and any substantial threat to health, safety or welfare will involve the State's apparatus (including the Attorney General, the IEPA and PCB). The State acts independently of the City or County. The Operator under both agreements is required to notify the State of a whole host of problems or events. The County's enforcement scheme requires notification to the State at the same time it notifies the Operator of any breach or issue. The City's enforcement scheme permits notification to the State at 3 any time (there is nothing in the City's Agreement that prohibits such notification). But this is where the two agreements diverge in their approach. City: (Section 17) The City is to notify the Operator within 48 hours of being made aware of any violation and the Operator has 72 hours thereafter to a) remedy the violation, or b) initiate a remedy if such remedy will take longer than 72 hours to complete. Should the Operator fail to remedy or initiate a remedy within the time prescribed, then the City is authorized to take such actions and assume control over the operation or site as necessary to cure the violation.(Section 17). Thus, in a situation in which the Host and the Operator are at odds over a perceived violation of a standard, the City has the right to take such physical action as it deems appropriate on day 6. County: (5.3) The County is to notify the Director of the IEPA, the IEPA regional field office and the Operator. The County then must wait for the IEPA to Act. If the IEPA does not act within 30 days (or does not act in a way the County wishes) then the County must wait until 60 days after the date on which the Operator received the notice to file an action for enforcement. Thus, in a situation in which the Host and the Operator are at odds over a perceived violation of a standard, the County cannot even seek injunctive relief until day 60. A word on "injunctive relief ". Injunctive relief is the Court ordering a certain person to j take a certain action. To obtain injunctive relief, the party seeking it must know what it is they want the court to order. In the case of violations of the State standards, it would take engineers and environmental experts to determine what course of action is needed. The City has the right to act on those recommendations beginning on day 6 without needing the blessing of the Court. The County, by contrast, has to wait until at least day 60 to ask the Court—in an adversarial situation where the Operator is contesting the claim —to grant permission to take the action it desires. The City also has on deposit, a revolving fund of $10,000.00 of the Operator's money upon which the City can draw to pay the consulting costs (engineers, experts, lawyers) and contractors involved in analyzing, prosecuting and fixing the problem. The $10,000 is only the deposit; the Operator is responsible for all costs incurred by the City to correct or handle a violation. Before drawing on the funds, an administrative hearing before a Board composed of the Mayor, the Manager, and the Director of Public Works must be held and they must find that the City,is entitled to draw upon the fund. If the Operator does not like their decision, they can appeal to an arbitration proceeding. Why arbitration? Because of the speed and general background expertise it offers any dispute. While the Kendall County Circuit Court certainly has the acumen and ability to handle any disputes, those excellent jurists are not engineers or environmental scientists and they also have full dockets (indeed, the need for additional judges in this Circuit is well documented). To bring a dispute before them requires educating the judges on the general scientific background of the operation 4 i and regulatory framework as well as the specifics of the dispute. It also means that the dispute is in a queue with the other citizens and entities of Kendall County —all of whom believe that their cases are important and they they too warrant the attention of the Judges. This combination of education and docket inevitably means a longer time to a decision on the dispute. We compared that to the timeline available through the American Arbitration Association where a panel of environmental law, engineering and science experts are available to decide the dispute and the dispute is one of perhaps a dozen matters the arbitrator has as opposed to one of many hundreds. We are attempting to put science and engineering first (and legal formalities second) because the landfill will still be there and still operating after this one dispute is resolved —and we are trying to make a difference in the operation going forward as quickly as possible, not just punish for past wrongs. Notably, under the County's agreement, if the Operator chooses to pay the stipulated damages, then no further action by the County is permitted. 2. WELL PROTECTION This is another area where the difference in approach between the City and the County is manifest. Both Agreements contain a Domestic Well Protection Agreement, but they differ dramatically on how they treat the well owner who thinks he has a problem. City: Complaint received at City Hall generates obligation on Operator to provide potable water within 24 hours and then send sample of well water out for testing. Alternate potable water supply obligation on the Operator continues until test results show that landfill is not the cause of the problem. City program continues through post - closure (30 years after closure). County: Complainant must first obtain laboratory analysis that shows landfill is responsible before Operator has obligation to provide an alternate potable water supply. County program only when landfill "active." 3. HOST BENEFIT FEE The pay scales differ but, for comparison purposes, if we assume 1 million tons per year, the City receives $4.02 per ton and the County receives $3.89 per ton. Brooke has prepared a projection based upon an anticipated CPI of 3% and anticipated volumes and it is depicted in the attached Graph and Table. Both Agreements provide for an upfront payment: City's Agreement calls for the donation of 16 acres of land suitable for a public works /parks department facility in order to solve a pressing and immediate need of the entire City. County's Agreement calls for cash: $500,000 plus 5 more payments of $100,000 for each of the first 5 years. 5 i The County Agreement sets a minimum payment equal to the amount generated by a million tons per year. The City agreement sets no minimum and adopts the proportional benefit philosophy (create no financial incentives to shortcuts on any operational expenditures). The County Agreement also substantially modifies the force majeure clause to create exceptions that relieve the Operator from the minimum payment obligation (e.g., new technology or new laws). The County Agreement also sets forth what purports to be a waste stream commitment. As the Application defining service area does not exist —and the proposed landfill is not identified in the hauling contracts WMI has now —this provision has little substantive effect at this stage. The City will address any issues on waste stream and service area after reviewing the Application and the evidence submitted thereon. 4. SHARING HOST FEE City Agreement creates possibility of sharing 22.15 fee with other units of government. The County Agreement (diverging from requirements of County Solid Waste Plan) does not provide for sharing of Host Fees. 5. DISPOSAL GUARANTEE I The City Agreement contains a guarantee for 20 years of access for MSW generated f within the City limits. The County Agreement has a contingency that may lead to guaranteed capacity for Kendall County municipalities. 6. ASSIGNMENT OF RIGHTS Both Host Agreements prevent the assignment of any interests in the landfill without City's consent. County restates specific requirements for transfer of rights to gas (although already covered). County has a filing fee and option to hold a hearing. Hearing option and Operator covering the costs of the review and hearing is a good idea and we will recommend that as a condition of siting. 7. PROPERTY VALUE PROTECTION PROGRAM Both Agreements contain a property value protection program 8. PREFILING REVIEW The City Agreement permits a "staff review" by experts in advance. The issue is safety and the City Agreement believes it is best to get as many expert eyes reviewing the ideas before any part of the process commences. The siting authorities are not included in these discussions and their impartiality is preserved. The County I 6 Agreement is silent, but the County apparently does do some prefiling review (e.g., traffic) 9. INSURANCE Both Agreements contain indemnification and insurance requirements. Often these requirements are the subject of the conditions of the siting. 10. END USE Required in application. City Agreement: Contemplates as a condition that will further define the end use after public input during process. 11. MATERIAL RECOVERY /RECYCLE City Agreement provides for material recovery activities and public convenience center for recycling drop off. County Agreement (deviating from its own SWMP) is silent. 12. MISCELLANEOUS. The County Agreement sets for terms that the City anticipates being the subject of conditions of any approval after the Application is filed, facts about the operation are known, and the public has had a chance to speak on the issues. Examples include: j Traffic Issues Spill Reimbursement Truck Tarping Plan Communications (Hotline /Internet Site /Tours /Community outreach group) j I i I I 7 Host CompensaUon Foe CCompar son $5,000,000- $4,500,000--- 4,500,000 - - $4,000,000-- $3,500,000- I i $3,000,000 - --"' $2,500,000 $2,000,000 $1,500,000 - $1,000,000 $500,000- LJ Upfront Year 1 Year 2 Year 3 Year 4 Year 5 Average Operating Year ® Fox Moraine LLC ® Kendall Land and Cattle j Fox Moraine - Kendall Land and Cattle Estimated Annual Host Benefit Fee * Kendall Land and Year Fox Moraine LLC Cattle Difference Upfront 960,000 ** 500,000 460,000 One 4,018,207 3,987,500 ** 30,707 Two 4,100,664 4,104,125 ** (3,461) Three 4,185,595 4,224,249 * ** (38,654) Four 4,273,074 4,347,976 * ** (74,902) Five 4,363,177 4,770,862 * ** (407,684) Average (first 5 years) $ 4,188,144 $ 4,286,942 $ (98,799) * Based on 1,000,000 tons per year and 3.0% annual escalation In kind (16 acres of real property @ $60,000 per acre) * ** Includes $100,000 in lump sum fees for first five yeas of operations