Title
Environmental Management Department recommending the Board:
1) Receive and file a presentation from Recology Inc; and
2) Approve and authorize the Chair to sign the third Amendment to the current Franchise Agreement, adding Section I, Assignment and Guaranty of Continued Performance, assigning the Tahoe Truckee Sierra Disposal Franchise Agreement to Recology, Inc., which remains in effect through September 2028.
FUNDING: Solid Waste Franchise Fees.
Body
DISCUSSION / BACKGROUND
Tahoe Truckee Sierra Disposal (TTSD) has served the Tahoe-Truckee-Sierra region for more than six decades, and began its franchised service in El Dorado County upon execution of the Solid Waste Services Agreement on September 29, 2015 (Attachment C). TTSD currently provides residential and commercial solid waste and recycling services under its franchise agreement with the County.
On July 22, 2026, Environmental Management received formal notification that Recology Inc. signed an agreement to purchase 100 percent of the equity of TTSD and the Eastern Regional Sanitary Landfill, Inc. (Attachment D). Following closing, TTSD will remain the legal entity holding the Franchise Agreement, and, other than filing for an entity name change to Recology Tahoe Truckee following the close of the sale, all existing operations and assets will continue without change. The transaction is an all-cash purchase with no seller-financed components. Recology will become the owner of TTSD, and because TTSD continues as the contracting entity, the current Franchise Agreement remains in effect.
Recology is the largest 100 percent employee-owned resource recovery company in the United States, providing collection, recycling, organics, and disposal services to 133 communities across California, Oregon, and Washington. Recology submitted extensive documentation demonstrating its operational capacity, long-term financial stability, and qualifications to assume TTSD’s obligations.
Consent to Assignment
Section 12 of Solid Waste Services Agreement #6917 requires Board approval prior to any transfer, sale, or assignment of the franchise. Environmental Management has verified that TTSD remains the existing legal entity and ongoing operating company under the Franchise Agreement. The proposed transaction represents a change in ownership only, and does not create a new service provider or alter TTSD’s operational identity, assets, or obligations. This verification confirms that the assignment is limited to a change in corporate control and is consistent with Section 12 requirements.
Under Section 12, the County must review:
• Recology’s financial stability and five-year financial history.
• Proof of at least seven years of mixed solid waste experience at a scale equal to or exceeding TTSD’s operations.
• Demonstrated compliance with AB 939 and other applicable laws and regulations.
• All purchase and assignment documents.
• Any additional information required to ensure Recology can fully assume TTSD’s obligations safely and effectively.
Staff has reviewed Recology’s qualification materials and confirmed compliance with all Section 12 requirements.
Staff has reviewed Recology’s qualification packet and verified compliance with all Section 12 requirements.
Cost Recovery
Section 13 (Franchise Transfer Fees) authorizes the County to recover all direct and indirect administrative expenses, including staff time, consultant fees, and County Counsel review, associated with evaluating a proposed franchise transfer. The Agreement allows reimbursement up to $35,000, supported by documentation of actual County costs. Staff recommends establishing the transfer fee accordingly.
Third Amendment to Solid Waste Services Agreement #6917
The Third Amendment to Solid Waste Services Agreement #6917 (Attachment B) updates and replaces several articles of the existing franchise agreement to align the TTSD/Recology franchise with current County policies, operational practices, and administrative requirements. The amendment also formalizes provisions related to Recology’s acquisition of TTSD. Key elements of the amendment are summarized below.
1. Consent to Assignment and Continuation of Performance
The amendment documents the County’s consent to the change in control resulting from Recology’s acquisition of Tahoe Truckee Sierra Disposal. TTSD will continue as the legal franchise entity and affirms that it will fulfill all contractual obligations following the transaction’s effective date.
2. Updated Delinquency, Billing, and Customer Accounting Requirements
Several articles are fully replaced to modernize customer billing and strengthen enforcement tools. Updates include revised delinquency notification procedures, the ability to discontinue service after 60 days of non-payment, application of monthly late fees, and clarification of rules related to over- and under-billing. The amendment also requires TTSD/Recology to maintain an updated customer database and provide electronic billing options. These changes enhance transparency, consistency, and County oversight of franchise billing practices.
3. Revised Billing Cycle and Recordkeeping Provisions
The amendment establishes standard billing intervals-quarterly for residential customers and arrears billing for commercial customers-and authorizes electronic statements upon customer request. It also requires the contractor to retain all billing records for County inspection and support the inclusion of County-provided bill inserts during regular billing cycles.
4. Addition of the County’s Rate-Setting Manual Definition
A new definition is added for the “Solid Waste Rate Setting Policies and Procedures Manual for Unincorporated Areas,” ensuring the franchise agreement references the County’s established framework for processing rate adjustments and Proposition 218 compliance where applicable.
5. Mandatory Collection Clarifications and Seasonal Service Exemption Updates
The amendment clarifies how the County’s mandatory solid waste collection program applies in the Tahoe Basin and provides more detailed guidance for residents who leave their properties unused during the winter season. Properties are required to maintain refuse service whenever they are used. A property may request a temporary exemption only if it will be completely unused for an entire service quarter, and the request must be submitted before the quarter begins.
For the January-March service quarter, exemption requests must be submitted during the window of November 15 through December 15. Exempt properties may be inspected to verify that they are not being used. If a property without service is found to be occupied or actively used, refuse service will be automatically started and billed at the minimum service level for the entire quarter. These updates formalize the existing seasonal opt‑out practice and provide clearer guidance for residents and the franchise hauler.
Except for the sections amended and replaced, all other provisions of Agreement #6917 remain unchanged and in full force and effect.
Customer Impacts
No changes to customer rates are proposed at this time. Service continuity will be maintained, with the same TTSD operational staff continuing to serve the franchise area. Recology intends to retain the existing TTSD customer service office and support TTSD’s existing community engagement and education programs.
The franchise agreement expires in September 2028. Environmental Management will negotiate a new Franchise Agreement with Recology and return to the Board with alternatives should negotiations not reach acceptable terms before expiration.
Recommendation
Environmental Management concludes that Recology meets all conditions of Section 12 and recommends the Board consent to the assignment of the TTSD Franchise Agreement, approve the Third Amendment, and authorize recovery of County costs through the Franchise Transfer Fee.
ALTERNATIVES
The Board may deny the transfer; however, doing so would interrupt TTSD’s planned change of ownership. Staff review indicates Recology meets all criteria required by the Franchise Agreement.
PRIOR BOARD ACTION
N/A
OTHER DEPARTMENT / AGENCY INVOLVEMENT
County Counsel
CAO RECOMMENDATION / COMMENTS
Approve as recommended.
FINANCIAL IMPACT
There is no fiscal impact to the County beyond staff time, which will be reimbursed under the Franchise Transfer Fee.
CLERK OF THE BOARD FOLLOW UP ACTIONS
1. Obtain the Chair’s signature on the Resolution and forward a copy to Environmental Management.
2. Obtain the Chair’s signature on two originals of the Third Amendment and forward one fully executed version to Environmental Management.
STRATEGIC PLAN COMPONENT
N/A
CONTACT
Jeffrey Warren, REHS
Director