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H3. Sludge Management AgreementL Kalispell Public Works Department 201 1" Avenue East, P.O. Box 1997, Kalispell, MT 59903-Phone (406)758-7720 www.kalispell.com MONTANA To: Douglas Russell, City Managervl�_ From: Susie Turner, P.E., Public Works Director Re: Sludge Management Agreement -Glacier Gold LLC Meeting Date: January 22, 2019 The City and Glacier Gold Compost have a Sludge Management Agreement that ensures the disposal of Kalispell's bio-solids (sludge). The City uses Glacier Gold Composting as the primary method of sewage sludge disposal, and the secondary disposal location is at the Flathead Landfill. Kalispell's BNR plant has been disposing sewage sludge at Glacier Gold Compost since 1993, with the current sludge management agreement initiated in 2014. The term of the current agreement is set for a five-year period from April 1, 2014 to March 31, 2019, with the option for the Agreement to extend for an additional five years by mutual agreement in writing by both parties. Glacier Gold Compost Owners and City Public Works Staff mutually agree it is in both parties best interest to extend the current agreement, as is, for an additional five years. Below is a summary highlighting sections of the current agreement. A copy of the current Agreement is enclosed for reference. Charges/Adjustments: The City is currently paying $238 per dry ton of sludge delivered to and accepted by Glacier Gold. The City will continue to pay a fixed rate of $238 per dry ton of sludge for the next five years. Truck Washdown Service: Glacier Gold provides a truck washdown service area at the composting site for use by the City, at no charge to the City. This allows the WWTP Operators to washdown the equipment at the composting facility reducing pungent odors and fugitive biosolids from blowing out of the back of an empty truck while traveling on the Highway. Physical Characteristics: The sludge is required to be dewatered between 13% and 20% solids content. The typical sludge solids content for Kalispell is 13-151o. Kalispell Operators are continually refining the dewatering process to generate a drier cake, in an effort to improve handling of the sludge disposal at the Landfill. Testing: The City will continue to perform the quarterly zinc sampling per the EPA requirements. Term: The initial term of this Agreement is for a five (5) year period from April 1, 2014 to March 31, 2019. The Agreement may be extended for an additional five (5) years by mutual agreement in writing by both parties. If any of the terms of this Agreement are to be modified by these extensions, they will be subject to renegotiation by both parties upon written notice by either party, thirty (30) days prior to the expiration of the term. Sludge Removal and Delivery: The annual delivery shall not exceed 600 dry ton per year unless revised by mutual consent in an amendment to the Agreement. The City may delivery up to 600 dry tons per year to Glacier Gold Composting, but retains the right to dispose of biosolids as the City deems necessary to sustain disposal operations in the future. Follow-up meetings and discussions with the Solid Waste Board of Directors, Flathead County Staff, Whitefish and Columbia Falls Public Works Staff, and Kalispell Staff have led to the development of procedural and scheduled deliveries of Biosolids by all entities to the County Landfill. For the time being, the Landfill established a minimum acceptance standard of 20 gallons of sludge for every ton of municipal solid waste received by the landfill. At this time, Whitefish does not deliver biosolids on a regular basis to the landfill, therefore routine load deliveries were scheduled between Kalispell and Columbia Falls. Kalispell is delivering two loads a week to the Landfill, every Monday and Wednesday morning. In the spring of this year, the entities will meet again to review schedules, deliveries, and discuss the potential for the Landfill to receive extra loads from Kalispell in the summer. The Landfill's acceptance of two loads per week reduces the number of loads Kalispell would bring to Glacier Gold Composting, extending the immediate need to fund alternate biosolid management practices. The table below provides a projection of the biosolids generation and load deliveries to Glacier Gold Composting and the Landfill. Biosolids Landfill Landfill Glacier Gold Glacier I Year Loading (dry LoadslYear' Loads/Week LoadsNVeek dry tonstyr) tonstyear.LoadsNVeek drytons, .. _ 2017 608 285 5 1 1 165 1 4 443 2018 620 291 6 1 2 177 1 4 443 2019 632 297 6 1 2 189 1 4 443 2020 645 303 6 1 2 202 1 4 443 2021 658 309 6 1 2 215 1 4 443 2022 671 315 6 1 2 228 1 4 443 2023 684 321 6 1 2 241 1 4 443 2024 698 328 6 1 2 255 1 4 443 2025 712 334 6 1 2 269 1 4 443 2026 726 341 7 1 2 173 1 5 554 2027 741 M8 7 1 2 187 1 5 554 2028 756 355 7 1 2 202 1 5 554 2029 771 362 7 1 2 217 1 5 554 2030 786 369 7 1 2 232 1 5 554 2031 802 376 7 1 2 248 1 5 554 2032 818 384 7 1 2 264 1 5 554 2033 834 392 8 1 3 281 1 5 554 2034 851 400 8 1 3 297 1 5 554 2035 868 408 8 1 3 314 1 5 554 2036 885 416 8 3 332 5 554 2037 903 424 8 1 349 5 554 1: Projected 2% growth rate, 2: 2.13 dry tonsAoad,13 wet tons or 26,000lbsAoad RECOMMENDATION: Approve the term extension for an additional five years to expire on March 31, 2024. ACTION REQUESTED: Motion to approve the term extension for the Sludge Management Agreement with Glacier Gold Composting. FISCAL EFFECTS: There are no additional fiscal effects associated with this agreement. Contract Service - Glacier Gold line item 354 is budgeted annually in the Wastewater Treatment Plant Fund. ALTERNATIVES: As suggested by City Council. 140012 SLUDGE MANAGEMENT AGREEMENT THIS AGREEMENT, made this , day ofy,_, 1" , 20, by and between the City of Kalispell, a municipal corporatio , hereinafter called "CITY" and Glacier Gold L.L.C., hereinafter called "GLACIER GOLD". WHEREAS, the CITY operates a secondary sewage treatment plant for municipal wastewater that produces an end product of dewatered sludge; and WHEREAS, GLACIER GOLD has in its priced proposal alternative, dated January 26, 2004, attached hereto and made a part of this Agreement, requested the opportunity to obtain the sludge for its product line, and intends to use the sludge, along with certain bulking agents, to produce a man-made humus which GLACIER GOLD markets as an organic fertilizer and soil conditioner; and WHEREAS, the parties are desirous of entering into an agreement whereby the CITY provides to GLACIER GOLD the dewatered sludge. WITNESSETH: ARTICLE I SERVICES AND CHARGES SLUDGE REMOVAL AND DELIVERY. The CITY will provide to GLACIER GOLD and GLACIER GOLD will accept all the dewatered sludge produced at the CITY'S wastewater treatment plant. The annual delivery of sludge shall not exceed 600 dry tons per year unless revised by mutual consent in an amendment to this Agreement. The CITY shall supply all labor, equipment, materials, fuel, repairs, equipment operators, supervisory personnel required to deliver the sludge to GLACIER GOLD'S composting operation located in Olney, Montana and to deposit the sludge as directed by GLACIER GOLD personnel on site. 2. CHARGES/ADJUSTMENTS. The CITY shall pay to GLACIER GOLD, two hundred dollars thirty eight dollars ($238) per dry ton of sludge delivered to and accepted by GLACIER GOLD. 1 3. TRUCK WASHDOWN SERVICE. GLACIER GOLD shall provide truck washdown service at its composting operation site for use by CITY equipment, at no cost to the CITY. ARTICLE II SLUDGE CHARACTERISTICS PHYSICAL CHARACTERISTICS. The sludge delivered to GLACIER GOLD by the CITY shall typically be dewatered between thirteen percent (13%) to twenty percent (20%) solids content. Seasonal variations in percent solids may occur but at no time shall sludge be delivered that is not suitable for use by GLACIER GOLD. 2. CHEMICAL CHARACTERISTICS. The CITY shall not deliver to GLACIER GOLD any sludge where test results of the sludge exceed maximum contaminant limits established by the EPA or State Water Quality Bureau. If the sludge contains any physical, chemical or organic chemical characteristics that render it unsuitable for use by GLACIER GOLD, GLACIER GOLD has the right to refuse acceptance of the sludge. The CITY agrees to notify GLACIER GOLD within 24 hours of any test results which indicate the sludge is unsuitable for GLACIER GOLD'S use. ARTICLE III MEASUREMENT AND PAYMENT FORMULA FOR DETERMINING DRY TON. For purposes of this Agreement the computation of dry tons shall be determined as follows: Dry ton = % of solids x wet ton 2. MAINTENANCE OF RECORDS. CITY will maintain accurate records of tonnages delivered to GLACIER GOLD in a form adopted by the CITY. CITY shall provide records on 2 tonnage delivered to GLACIER GOLD with each billing cycle. These records will form the basis of payment under Article I of this Agreement. 3. LOADING MEASUREMENT The CITY shall determine the tonnage of sludge to be hauled by all trucks. Tonnage delivered to GLACIER GOLD shall be determined by weighing trucks delivering sludge when full and then weighing truck when empty. All weighing shall be done on certified scales supplied by GLACIER GOLD. Duplicates of weight tickets shall be supplied to GLACIER GOLD. 4. INVOICE SUBMISSION AND PAYMENT CITY shall pay GLACIER GOLD within thirty (30) days of receipt of itemized invoices. The invoices shall identify the date, tonnage, and percent of solids for each load delivered to GLACIER GOLD by the CITY. ARTICLE IV SCHEDULES AND TESTING SCHEDULES. CITY and GLACIER GOLD shall develop and agree to a normal operating schedule which will allow the CITY to efficiently operate the wastewater treatment plant and allow GLACIER GOLD to accept the projected volume of the sludge. Unless otherwise agreed to in writing between the CITY and GLACIER GOLD sludge may be delivered to the GLACIER GOLD composting facility between 8:30 a.m. and 3:30 p.m., Monday through Friday. 2. TESTING. CITY will provide to GLACIER GOLD results of tests conducted on the sludge with regard to percent total solids with each load delivered. In addition to the information as provided in Article II, Section 2, analyses for TKN, total Phosphorous, ammonia, nitrates and routine heavy metals will be provided to GLACIER GOLD -on a quarterly basis. Upon written request from GLACIER GOLD, CITY will provide GLACIER GOLD with the results of any additional sludge tests conducted by the CITY. If 3 GLACIER GOLD conducts any test on the sludge, GLACIER GOLD shall provide the results of such test to CITY. ARTICLE V PERMITS, CHANGES TO LAW PERMITS. GLACIER GOLD shall have the full responsibility and any and all liability for meeting the terms conditions of any permits which GLACIER GOLD must acquire relative to the program outlined in this Agreement. GLACIER GOLD agrees to hold CITY harmless and indemnify the CITY with regard to GLACIER GOLD'S lack of compliance or any other reason which results in an action of regulatory enforcement or litigation relative to GLACIER GOLD'S program and ultimate disposition of GLACIER GOLD'S end product. GLACIER GOLD shall acquire and maintain in continuous effect liability insurance in the amount specified in Article VI. GLACIER GOLD must be in continuous compliance with the provisions of any permit or law applicable to its business operations, or it will be in default with the provisions of this Agreement. 2, CHANGES TO LAW. The price agreed to above is based on GLACIER GOLD'S anticipated compliance with current Federal, State, and Local laws and permitting requirements. In the event that there are changes in such laws, permitting requirements, regulations, or local interpretation of the laws or regulations which impose additional or lesser costs which are attributable to the characteristics of the sludge, either the CITY or GLACIER GOLD may request that the agreed to price may be renegotiated, stating in detail the reason or justifications for the request. Such request for additional or lesser sums must be in writing. In the event agreement of a revised amount cannot be reached within sixty (60) days of receipt of such request, either party may terminate this Agreement with ninety (90) days written notice. ARTICLE VI INSURANCE, INDEMNIFICATION, AND BONDING INSURANCE REQUIREMENTS. Without limiting GLACIER GOLD'S indemnification of the CITY, GLACIER GOLD shall provide and maintain at its own expense during the terms of this Agreement, the following policy or policies of insurance covering its operations hereunder, whether such operations be by GLACIER GOLD or by any subcontractor or by anyone for whose acts any of them may be liable. Such insurance shall be secured through a carver satisfactory to the CITY. Evidence of such insurance satisfactory to the CITY shall be delivered to the CITY on or before the effective date of this Agreement, and shall contain the express condition that the CITY is to be given written notice at least thirty (30) days in advance of cancellation, modification, expiration, or termination of any policy of insurance. The CITY shall be named as an additional named insured on all policies except worker's compensation. 2. GENERAL LIABILITY Such policy of insurance shall include, but not be limited to, comprehensive general liability with explosion, collapse, and underground hazards, contractual liability, products/completed operations and independent contractor's endorsements, with a combined single limit not less than $750,000.00 per claim and $1,500,000.00 per occurrence. Such insurance shall be primary to and not contributing with any other insurance maintained by the CITY and shall name the CITY as additional insured. 3. WORKER'S COMPENSATION GLACIER GOLD'S employees shall be covered by Worker's Compensation insurance in an amount and form to meet all applicable requirements of the Labor Code of the State of Montana. 4. FAILURE TO PROCURE INSURANCE. In case of failure on the part of GLACIER GOLD to procure or maintain required insurance, GLACIER GOLD shall be deemed to be in default of this Agreement. CITY shall notify GLACIER GOLD of such default and GLACIER GOLD shall within 30 days of such notice of default, take corrective action to rectify such default by procuring and maintaining the required insurance. 5. INDEMNIFICATION. GLACIER GOLD agrees to indemnify, defend and save the CITY, its agents, elected and appointed officials, and employees from suppliers', or agents' operations, or anyone directly or indirectly employed by any to 5 them, or their services, from and against any and all liability, expense, including defense costs and legal fees (including costs and attorney's fees on appeal), and claims for damages of any nature whatsoever, including, but not limited to bodily injury, death, personal injury, or property damage arising from or connected to GLACIER GOLDS, its subcontractors', suppliers', or agents' operations, or their service hereunder, including any worker's compensation suits, liability, or expense arising from or connected with services by any person pursuant to this Agreement. The CITY shall specifically be indemnified and held harmless of any liability as a result of the sale or use of the sludge produced by the CITY in any form whatsoever, except when the liability is occasioned by the CITY'S negligence or failure to inform as required in Article 11, Section 2, supra. ARTICLE V II TERM OF AGREEMENT TERM. The initial term of this Agreement is for a five (5) year period from April 1, 2014 to March 31, 2019. The Agreement may be extended for an additional five (5) years by mutual agreement in writing by both parties. If any of the terms of this Agreement are to be modified by these extensions, they will be subject to renegotiation by both parties upon written notice by either party, thirty (30) days prior to the expiration of the term. 2. TERMINATION. a) All terms and conditions of this Agreement are considered material, and failure to perform any of the terms and conditions on the part of either party shall be considered a breach of this Agreement. In the event either party to this Agreement breaches the Agreement, the party not in breach of this Agreement shall notify the breaching party in writing of the nature of such breach. Within ten (10) days of said notice the breaching party shall correct the breach. b) In the event the breaching party fails to correct the breach, as provided in (a) above, the party not in breach, without further notice, shall have the following rights and remedies, which may be exercised singly or in combination: 6 i) The right to declare this Agreement, together with all rights granted thereunder, terminated, effective immediately; ii) The right to contract with others to perform the services otherwise to be performed by the breaching party, or to perform such services itself; and iii) Any and all rights under federal laws and the laws of the State of Montana. c) Notwithstanding paragraphs (a) and (b), supra, the CITY shall have the right to terminate this Agreement if GLACIER GOLD fails in any consecutive 30 day period to accept sludge under the terms of this Agreement. d) Notwithstanding paragraphs (a), (b), and (c), supra, GLACIER GOLD, upon twelve (12) months written notice, shall have the right to terminate this Agreement for the business reason stated in the Proposal Alternative 1, attached hereto, and for no other reason except as specified in Article V, Paragraph 2. ARTICLE VIII MISCELLANEOUS BINDING EFFECT. This Agreement is binding upon the heirs, successors, administrators, executors, personal representatives and assigns of the parties hereto. 2. ENTIRE AGREEMENT. This Agreement and Proposal Alternative 1, attached hereto, comprise the entire agreement between the parties. This Agreement completely replaces any and all prior agreements of any nature whatsoever. Any additional agreement hereafter made shall be effective to alter, change, modify • or discharge this Agreement in whole or in part unless any additional agreement is in writing and signed by the parties hereto. 3. SEVERABILITY. If any article, section, subsection, sentence, clause, phrase or word of this Agreement is ever for any reason held to be invalid by a court, the parties hereby agree that such decision shall not affect the validity of the 7 remainder of this Agreement, and the parties agree that the remaining provisions shall remain in full force and effect. 4. AFFIRMATIVE ACTION POLICY. Contractors, subcontractors, subgrantees, and other firms doing business with the CITY or any agency connected with the CITY must be in compliance with the CITY'S Affirmative Action Plan and Title 49, MCA or forfeit the right to continue such business dealings. 5. NON-DISCRIMINATION. In connection with the performance of work and services under this Agreement, the contractor agrees to comply with the provisions of the law and Constitution of the State of Montana. Contractor further agrees to comply with the Civil Rights Act of 1964 (78 Stat. 242), the regulations of the Department of Health, Education and Welfare issued pursuant to the Act, and the provisions of Executive Order 11246, Equal Opportunity, September 24, 1965. The contractor agrees that any and all hiring by them related to this Agreement shall be on the basis of merit and qualifications and there shall be no discrimination on the basis of race, color, religious creed, political ideas, gender, age, marital status, physical or mental handicap, national origin or ancestry, by persons performing this contract. Qualifications mean such abilities that are genuinely related to the competent performance of the particular occupational task. 6. ATTORNEY'S FEES. In the event either party brings a legal action under this agreement, the prevailing party shall be entitled to its reasonable attorneys' fees and costs in prosecuting or defending the action. 8 GLACIER LD CO OSTING, WC' L1 C BY: ITS: CITY OF K&LISPELL BY: kly AGER ATTEST: