31 City Council Agenda Report

TO:

FROM:

RE:

City Council

Linda Herman, Public Works Administration Manager

Meeting Date: March 3, 2015

CONSIDERATION OF A RESOLUTION AUTHORIZING THE RENEWAL OF THE

CHICO/NORTHERN BUTTE COUNTY RECYCLING MARKET DEVELOPMENT ZONE (RMDZ).

REPORT IN BRIEF:

In 1994, the City of Chico and surrounding area was designated as the Chico/Northern Butte County RecyclingMarket Development Zone (RMDZ) by Department of Resources Recycling and Recovery (CaIRecycle). Thepurpose of the RMDZ is to provide low-interest loans, technical assistance and free product marketing tobusinesses that locate within the zone, and which use recycled materials from the waste stream to manufacturetheir products. The Chico/Northern Butte County RMDZ terminates in March 2015, and staff recommends thatCouncil authorize submitting an application to renew the RMDZ for another 10 years.

Recommendation: That the City Council approve the following resolution:

A RESOLUTION OF THE COUNCILOF THE CITY OF CHICO SUPPORTING THE RENEWALOF THE

CHICO/NORTHERN BUTTE COUNTY RECYCLING MARKET DEVELOPMENT ZONE AS A

RECYCLING MARKET DEVELOPMENT ZONE.

FISCAL IMPACT: None. CaIRecycle provides upto$5,000 in Zone Incentive Funds(ZIF)to Zone Administratorseach fiscal year to help offset zone administrative costs and to market the RMDZ. These funds can be used forgraphics, printing, advertising, outreach, conferences, trade shows, and othereconomicdevelopment related coststo support the Zone. For 2014-15 the City was allotted $4,250, $750 for staffs participation in the Zone Workstrainings held quarterly in Sacramento, and $3,500 for marketing activities.

BACKGROUND:

CaIRecycle administers an RMDZ Loan Program to encourage recycling businesses to site new manufacturingfacilities and expand existing operations in California. This program provides low-interest loans, currently at 4%,for the purchase of equipment and other relevant business costs to eligible companies located in any of the 36designated zones in California. The intent of the Recycling Market Development Zone Loan Program is to helpCalifornia manufacturers increase their processing capabilities and create additional markets for recycled-contentand post-consumer products.

The Chico/Northern Butte County RMDZ encompasses approximately 130 square miles in the northernportion of Butte County. It includes the City of Chico and adjacent industrial property and additionalunincorporated county areas west and south of the sphere. A copy of the Zone map is attached as Exhibit "A"for Council's information. The City of Chico is the lead agency for the Zone, and four loans have been given tothe following local companies:

1. Wax Box Firelog Corporation - Wax Box Firelog Corporation which uses a patented machine toextrude fire logs out of waxed corrugated cardboard boxes, received a $462,000 RMDZ loan in 2002 toexpand this business in Chico. The company is now doing business as CleanFlame logs and hasrelocated to Gridley.

S:\_Old drive to be deleted July 2015\Sustain Task Force\Recycling and Solid Waste\RMDZ\RMDZ Renewal\2015 Renewal\3-3-15Council Agenda Report.wpd

RE: RMDZ Renewal

Meeting Date: 3/3/15Page 2

2. Van Duerr Industries -Van Duerr Industries produces entry landings, ramps and thresholds fromrecycled tires to assist businesses in complying with the Americans with Disabilities Act (ADA). VanDuerr received a $370,000 RMDZ loan in 2002. The company was also awarded a Tire ProductCommercialization and Applied Technologies Grant in the amount of $230,000 to buy equipment and forworking capital to allow the company to expand its manufacturing operations.

3. Work Training Center - The Work Training Center received a $35,000 loan in 2003 to purchase awood grinder to chip wood waste and pallets from its wood box making enterprise into a landscapemulch product.

4. Earthwork Soil Factory - Larry and Karen Royal received a $300,000 RMDZ loan to develop avermicomposting operation in 2003. The operation diverts yard waste, food waste and other organicmaterials from the landfill by using red earthworms to generate a reusable compost. The grant fundswere used to purchase worms, equipment, and for working capital.

DISCUSSION:

The term for all RMDZs is10 years and the Chico/Northern Butte RMDZ is scheduled to expire in March 2015.

Although no new loans have transpired since the last renewal, staff and other economic development entitiesreceive several inquiries about Chico and the RMDZ each year. To continue to facilitate local coordination,and support existing recycling-based manufacturing businesses, as well as attract private sector recyclinginvestments to the Chico area, Staff is recommending that Council authorize by resolution the submittal of anapplication to CaIRecycle to renew the RMDZ for another ten years. Because the RMDZ boundary alsoincludes unincorporated areas, the Butte County Board of Supervisors are considering a similar resolution atits 3/10/15 meeting to support the RMDZ renewal.

ENVIRONMENTAL REVIEW:

City Planning staff has determined that because the Chico/Northern Butte County RMDZ is part of an existing

program authorized by the State to reduce landfill waste and to enhance the environment, that the renewal iscategorically exempt from review under the California Environmental Quality Act (CEQA) pursuant to 14 CCRSection 15308 (Actions by Regulatory Agencies for Protection of the Environment).

PUBLIC CONTACT: Tonight's City Council meeting and this agenda item were publicly noticed.

Reviewed by: Approved by:

\L \ajaciRuben Martinezpfiblic Wdriactor Mark OrMe, City Manager

DISTRIBUTION:

City Clerk (3)Steve Rodowick, County Recycling Coordinator

ATTACHMENTS:

Exhibit A: Chico/Northern Butte County RMDZ MapResolution Supporting the RMDZ Renewal

RMDZ:Region Detail

EXHIBIT A

Cal Recycle *Recycling Market Development Zone

Chico / Northern Butte County

The Chico/Northern Butte County Recycling Market

Development Zone (RMDZ) is located in the fertile

Sacramento Valley, 60 miles north of Sacramento andapproximately 120 miles northeast of San Francisco.

Bordered by the Sacramento River to the west and

Sierra Nevada foothills to the east, the region has awealth of natural resources, and contains some of the

richest agricultural land in the nation. Chico is the

largest of the five incorporated cities in Butte County.

The Chico/Northern Butte County RMDZ encompasses

approximately 130 square miles in the northern portion

of the county. It includes the City of Chico and adjacent

industrial property and additional unincorporated county

areas west and south of the sphere.

>: Incentives

» Target Materials

:» Infrastructure

>) Contacts

Incentives

The Chico/Northern Butte County RMDZ local

incentives include a Development Impact Fee Deferralprogram; Business License Tax Rebate/Waiver:

database of vacant property; project development

review; and financial and technical support to recyclingbusinesses.

Target Materials

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Hamilton

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Page 1 of 2

View Local RMDZ Webpage

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Disclaimer I Find New Address

The Chico/Northern Butte County zone has targeted paper fibers, agricultural crop residue, plastics, tires, and woodwaste for manufacturing development.

Infrastructure

1.111

The zone area is primarily served by State Highways 99 (north-south arterial) and 32 (east-west arterial, intersecting

with Interstate 5 to the west). Southern Pacific Railroad offers regular freight service to the zone operatingapproximately 28 trains per day. Amtrak offers passenger service to Chico as part of its San Joaquin line. In addition tothe State highways, the city and the county maintain an extensive local street network serving all areas of theproposed zone. The city also operates and maintains the Chico Municipal Airport, which includes commercial air

service to San Francisco on United Express Airlines. A fixed base operator provides general aviation aircraft andcharter sen/ices. Over $200 million in capital improvements are planned for existing infrastructure.

http://www.calrecycle.ca.gov/RMDZ/Reports/Zones/Detail.aspx?RMDZID=4 02/17/2015

RMDZ:Region Detail

Contacts

Chico / Northern Butte County RMDZLinda Herman

Management AnalystCounty.ButteP.O. Box 3420

Chico, CA 95927

Phone: (530) 896-7241FAX: (530) 895-4731Email: linda.herman@chicoca.gov

CaIRecycle contact for this RMDZ:Zone Liaison: Cindi Rumenapp

Zone Search/Map

EXHIBIT A

Data updated continuously.Recycling Market Development Zone Program: http://www.calrecycle.ca.qov/RMDZ/Zone Assistance: Regional Zone Contacts or LAMD@calrecycle.ca gov, (916) 341-6199

Page 2 of 2

Conditions of Use I Privacy Policv

©1995,2015 California Department of Resources Recycling and Recovery (CaIRecycle). All rights reserved.

http://www.calrecycle.ca.gov/RMDZ/Reports/Zones/Detail.aspx?RMDZID=4 02/17/2015

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RESOLUTION NO.

A RESOLUTION OF THE COUNCIL OF THE CITY OF CHICO SUPPORTING

THE RENEWAL OF THE CHICO/NORTHERN BUTTE COUNTY RECYCLINGMARKET DEVELOPMENT ZONE AS A RECYCLING MARKET DEVELOPMENT

ZONE.

WHEREAS, California Public Resources Code Section 42010, et al. provides for the

establishment of the Recycling Market Development Zone (RMDZ) program throughout the

State which provides incentives to stimulate development of post-consumer and secondary

materials markets for recyclables; and

WHEREAS, all California jurisdictions must meet a 50% reduction in landfill waste

disposal as mandated by the California Integrated Waste Management Act; and

WHEREAS, the Chico/Northern Butte County RMDZ ("Zone") includes designated

areas in the City of Chico ("City") city limits and unincorporated areas within the northern

portion of the County of Butte ("County"); and

WHEREAS, the Zone is dedicated to establishing, sustaining and expanding recycling-

based manufacturing businesses, which is essential for market development and to assist these

jurisdictions in meeting the established landfill waste reduction goals; and

WHEREAS, the designation of the Zone will expire iii March 2015; and

WHEREAS, the City desires existing and new recycling-based manufacturing businesses

located within the Zone to be eligible for the technical and financial incentives associated with

the RMDZ program; and

WHEREAS. the renewal of Zone as an RMDZ is still necessary to facilitate local and

regional planning, coordination, and support existing recycling-based manufacturing businesses,

as well as attract private sector recycling investments to the RMDZ; and

WHEREAS, the continued development of local markets for recycled materials would

reduce the need to transport them out of the region in the future; and

WHEREAS, the current and proposed waste management practices and conditions are

favorable to the development of post-consumer and secondary waste materials markets; and

WHEREAS, the California Legislature has defined environmental justice as "the fair

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treatment of people of all races, cultures, and incomes with respect to the development, adoption,

implementation, and enforcement of environmental laws, regulations, and policies" [Government

Code section 65040.12(e)], and has directed the California Environmental Protection Agency to

conduct its programs, policies, and activities that substantially affect human health or the

environment in a manner that ensures the fair treatment o f people o f all races, cultures, and

income levels, including minority populations and low-income populations of the state [Public

Resources Code section 71110(a)] ; and

WHEREAS, CalRecycle has adopted a goal to continuously integrate environmental

justice concerns into all of its programs and activities; and

WHEREAS, the City and the County have agreed to submit an application to CalRecycle

requesting renewal of the Zone as an RMDZ; and

WHEREAS, the City has agreed to act as Lead Agency for the proposed renewal of the

Zone as an RMDZ; and

WHEREAS, in accordance with the California Environmental Quality Act (CEQA), the

City has determined that the proposed renewal is exempt from review under CEQA pursuant to

14 CCR Section 15308 (Actions by Regulatory Agencies for Protection ofthe Environment), and

finds there are no reasons to prepare an environmental document.

NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF

CHICO AS FOLLOWS:

The Council hereby:

1. Approves the renewal of Chico/Northern Butte County RMDZ, which includes the City

and portions ofthe unincorporated areas ofthe County, as an RMDZ.

2. Authorizes the City Manager to submit an application to CalRecycle requesting the

renewal.

3. Affirms the City will administer the RMDZ program in a manner that seeks to ensure the

fair treatment of people of all races, cultures and incomes, including but not limited to

soliciting public participation in all communities within the RMDZ, including minority

and low income populations.

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THE FOREGOING RESOLUTION was adopted by the City ('ouricil of' the C'ity of'

Chico at its meeting held on , hy the 1211]owing vote

AYES:

NOES:

ABSENT:

ABSTAINED:

DISQUALIFIED:

ATTEST.

Deborah R. Presson, City Clerk

APPROVED AS D FOIM AND CONTENT:

Vinent C. Ewing,ity Attbmey