REPORT TO COUNCIL
SUBJECT
Title
Accept the FY 2022/23 CalRecycle Beverage Container Quality Infrastructure Grant and Approve Budget Modification No. 25 in the Amount of $6,575,000
Report
GRANT SUMMARY
On November 12, 2024, the Council adopted Resolution No. 1254-24 (Attachment 2), which authorized the City Manager or his designee to submit applications for all CalRecycle Grants for which the City of Sunnyvale is eligible and to execute grant agreements as necessary to secure grant funds and implement approved grant projects (RTC 24-0743).
City staff applied for and were awarded a CalRecycle Beverage Container Quality Infrastructure Grant (QIG1) of $6,575,000 to upgrade the recycling and solid waste processing system at the Sunnyvale Materials Recovery and Transfer (SMaRT) Station®.
This grant is a result of the FY 2022/23 Budget Act, Assembly Bill 179, which allocated $50 million to CalRecycle from the California Beverage Container Recycling Fund. The goal of this CalRecycle Program is to provide infrastructure related to sorting to create clean streams of beverage containers that curbside recycling programs or drop-off collection programs can substantially support.
The City’s selected project is one of the nine projects approved for funding. The grant-funded equipment will recover additional beverage containers, aluminum cans, ferrous metal, Polyethylene Terephthalate (PET), High-Density Polyethylene (HDPE), Polypropylene (PP), glass, and carton containers delivered from the cities of Mountain View and Sunnyvale, while also increasing the purity of the recovered material.
The equipment includes magnetic separators to recover metal containers and clean glass, optical sorters and an associated air compressor system, an eddy current separator to recover aluminum cans, and conveyors to transport the recovered material to designated storage bunkers. This equipment will be installed as part of the NextGen Project contract awarded to Bulk Handling Systems by the Council on May 20, 2025 (RTC No. #25-0307).
The Solid Waste Division in the Department of Environmental Services will be responsible for grant management.
Granting Agency
California Department of Resources, Recycling and Recovery (CalRecycle)
EXISTING POLICY
Council Policy 7.1.5 Donations, Contributions and Sponsorships:
The City Manager may apply for grants of any dollar amount but shall notify the Council when grants are being pursued. Council approval of a budget modification to appropriate grant monies is required before funds can be expended by staff. Such a budget modification shall include the use to which the grant would be placed; the objectives or goals of the City which will be achieved through use of the grant; the local match required, if any, plus the source of the local match; any increased cost to be locally funded upon termination of the grant; and the ability of the City to administer the grant. For grants under the amount of $5,000 that do not have any external reporting requirements or any local match requirement, Council approval of a budget modification is not required. The City Manager is authorized to accept and administratively appropriate the grant funds.
This grant does not meet all of the criteria to be administratively appropriated by the City Manager; therefore, a budget modification is required. Grant funds from CalRecycle have external reporting requirements and fall under the federal single audit guidelines.
Pursuant to Sunnyvale Charter Section 1305, at any meeting after the adoption of the budget, the City Council may amend or supplement the budget by motion adopted by affirmative votes of at least four members so as to authorize the transfer of unused balances appropriated for one purpose to another, or to appropriate available revenue not included in the budget.
This Grant will also assist in achieving:
Council Policy 3.2.4 - Zero Waste: It is the policy of the City of Sunnyvale that the City will work to reduce the amount of Sunnyvale waste being disposed.
Council Policy 3.2.1 Solid Waste Management, Goal 3.2F: Maintain sound financial strategies and practices that will enable the City to provide comprehensive solid waste management services to the community while keeping refuse rates at or below countywide averages for cities using cost of service pricing.
ENVIRONMENTAL REVIEW
The budget modification does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(b)(4) in that it is a fiscal activity that does not involve any commitment to any specific project which may result in a potential significant impact on the environment. The grant funded activities are a small part of the upgrade at the SMaRT Station that was described and evaluated in an addendum to the previously certified Sunnyvale Materials Recovery and Transfer Station Final Environmental Impact Report (SCH No. 89022812) prepared for the NextGen Project that the City Council approved on May 20, 2025. As described in the addendum, there are no potential significant impacts associated with the project.
FISCAL IMPACT
Funding Source
Funding is provided by FY 2022/23 CalRecycle Beverage Container Quality Infrastructure Grant Program Funds of $6,575,000.
Required Local Match
None
Increased Cost To City Upon Grant Termination
Ongoing operating and maintenance costs are covered through the SMaRT Station operating budget and shared with the cities of Mountain View and Sunnyvale (currently Sunnyvale is responsible for approximately 70 percent). Future operating cost increases are estimated to be negligible, as the increased sales of recyclable materials will generate additional revenue. Additionally, the new equipment is expected to result in labor reductions, which will offset the operational costs associated with maintaining and operating this equipment.
The appropriation for the SMaRT Station Nextgen Project is in Fund 6143 - SMaRT Station Equipment Replacement Fund under Project 828260 - SMaRT Post-2021 Rebuild. Budget Modification No. 25 has been prepared to transfer $6,575,000 from Project 828260 to a new project - Beverage Container Recycling Equipment - Grant Funded to facilitate grant record-keeping requirements.
Budget Modification No. 25
FY 2024/25
|
|
Current |
Increase/ (Decrease) |
Revised |
|
SMaRT Station Equipment Replacement Fund |
|
|
|
|
Revenues |
|
|
|
|
CalRecycle Beverage Container Quality Infrastructure Grant |
$0 |
$6,575,000 |
$6,575,000 |
|
|
|
|
|
|
Expenditures |
|
|
|
|
New Project - Beverage Container Recycling Equipment - Grant Funded |
$0 |
$6,575,000 |
$6,575,000 |
|
|
|
|
|
|
Project 828260 - SMaRT Station Post-2021 Rebuild |
$45,869,669 |
($6,575,000) |
$39,294,669 |
PUBLIC CONTACT
Public contact was made by posting the Council meeting agenda on the City's official-notice bulletin board at City Hall, at the Sunnyvale Public Library and in the Department of Public Safety Lobby. In addition, the agenda and this report are available at the City Hall reception desk located on the first floor of City Hall at 456 W. Olive Avenue (during normal business hours), and on the City's website.
RECOMMENDATION
Recommendation
Accept the FY 2022/23 CalRecycle Beverage Container Quality Infrastructure Grant and Approve Budget Modification No. 25 in the Amount of $6,575,000.
Levine Act
LEVINE ACT
The Levine Act (Gov. Code Section 84308) prohibits city officials from participating in certain decisions regarding licenses, permits, and other entitlements for use if the official has received a campaign contribution of more than $500 from a party, participant, or agent of a party or participant in the previous 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-to-play-limits-and-prohibitions.html
An “X” in the checklist below indicates that the action being considered falls under a Levine Act category or exemption:
SUBJECT TO THE LEVINE ACT
___ Land development entitlements
___ Other permit, license, or entitlement for use
___ Contract or franchise
EXEMPT FROM THE LEVINE ACT
___ Competitively bid contract*
___ Labor or personal employment contract
___ Contract under $50,000 or non-fiscal
_x__ Contract between public agencies
___ General policy and legislative actions
* "Competitively bid" means a contract that must be awarded to the lowest responsive and responsible bidder.
Prepared by: Deepti Jain, Environmental Programs Manager
Reviewed by: Ramana Chinnakotla, Director, Environmental Services
Reviewed by: Matthew Paulin, Director of Finance
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. Executed Sunnyvale Beverage Container Grant Agreement
2. Grant Agreement Exhibits A-C
3. Resolution No. 1265-24