- Eastern Group Publications/EGPNews - http://egpnews.com -

Montebello Terminates ‘Evergreen’ Athens Contract

UPDATE (7/30/2010): The appointment of an interim city administrator will be discussed at two Montebello special meetings [1] scheduled  for Aug. 2 (Monday) and Aug. 3 (Tuesday), each starting at 9:30 a.m.

The city of Montebello moved to terminate an automatic renewal agreement with waste hauling company Athens Services on Wednesday, putting an end, for now, to a contractual relationship that has lasted nearly 50 years.

“I am elated!” said Montebello resident Mike Torres, who worked nearly two years to get the city to reconsider its waste-hauling contract with Athens.

“They [the city] should have terminated it in 1968, seven years after they got it [the contract]. They should never have given them an evergreen contract,” Torres told EGP.

According to a staff report, the city’s recommendation to terminate the agreement was “solely as a precaution and without expressing an opinion as to the validity or invalidity of any version” of the city’s contract with Athens.

The report points to the uncertain outcome of pending litigation against the city, in which Torres is named as the plaintiff. The lawsuit challenges the 2008 amendment to give Athens Services “evergreen,” or automatic renewal, rights, according to the report.

According to Deputy City Clerk Lillian Guzman, the city council wants to put the contract out to bid, but as of Thursday, the city has not yet officially terminated the contract with Athens. The vote on Wednesday approved sending a letter of termination to its long-time waste hauling services provider.

It is unclear whether Athens will pursue legal action against the city. Before Wednesday’s vote, a representative from Athens asked for an opportunity to speak to the city about “financial incentives that can benefit your general fund for years to come.”

“We have presented many creative innovations and proposals to the sister cities in this time of need. Athens wants to do everything we can to help turn the tide of employee layoffs and downsizing,” said Gary Clifford, Athens’ chief operating officer.

In return for approving the 2008 amendments to the Athens contract, the city was presented with a check of $500,000 and promised 7.5 percent of gross receipts.

Residents and local waste hauling companies began taking issue with the Athens contract in July of 2008, when the city approved an amendment to give Athens Services the exclusive right to serve commercial waste hauling needs in the city. The contract would become “evergreen,” which meant the contract would begin to automatically renew each year for fifteen years after the start of the 2008 amendments to the contract.

The council’s decision to approve the amendment led to a referendum effort to put the contract up to a public vote. The referendum ultimately never launched due to legal complications, but its failure led to a recall election in February 2010 that resulted in the ousting of two council members.

With the exception of Mayor Bill Molinari, a long-time councilman who voted against the 2008 amendments to the Athens contract, the council includes four freshman members. At Wednesday’s meeting, they unanimously approved sending a letter to Athens Services terminating the “evergreen” agreement, a move that was met with standing ovations from several audience members, many of whom were core participants in the referendum and recall campaigns.

“I think the community has expressed their feelings on this matter. It’s not a question of whether Athens is providing competent service in this area. This contract has not been out to bid since 1962,” Molinari said Wednesday.

“Without the opportunity for competitive bidding,” there is nothing to compare the prices offered by Athens as compared to that of another hauling company, Molinari said.

“I think all of us ran on the premise of fair enterprise,” said Councilman Frank Gomez, who won his seat on council in the Nov. 2009 city election, in which two seats were up. Mayor Pro Tem Art Barajas won the other seat.

At the same Wednesday meeting, the city council selected Captain Greg Wilsey as its acting police chief. The city also discussed finding people to fill the vacant director positions in the human resources and finance departments.

The city also has no city administrator at the moment after the resignation of former interim city administrator Randy Narramore. The council met at a special closed session meeting on Monday, July 27, to discuss an appointment for the position, but did not reach a final decision.

Barajas said after the Monday meeting that while day-to-day operations continue, they are unable to move forward on major city matters such as the budget, which they have not yet balanced.

Responding to the question of why they signed off on Narramore’s resignation, Barajas said members of the council did not want to see him leave, but “bottom line is he resigned.”

This story, with updates, will also be published in next week’s print issue, coming out August 5.