REPORT TO COUNCIL
SUBJECT
Title
Approve and Authorize the City Manager to Sign a Memorandum of Agreement Between the Cities of Sunnyvale, Cupertino, Mountain View, and San José, and the County of San Benito to Design and Implement a Community-Scale Reusable Foodware System Funded by a United States Environmental Protection Agency Climate Pollution Reduction Grant in the amount of $48,346,219
Report
BACKGROUND
United States Environmental Protection Agency’s (EPA) Climate Pollution Reduction Grants (CPRG) program will provide $5 billion in grants to states, local governments, tribes, and territories to develop and implement ambitious plans for reducing greenhouse gas emissions and other harmful air pollution. The County of Santa Clara developed the Priority Climate Action Plan (PCAP) for the San Jose-Sunnyvale-Santa Clara, CA metropolitan statistical area, which is comprised of San Benito and Santa Clara Counties. The PCAP was developed to support investment in policies, practices, and technologies that reduce greenhouse gas (GHG) and air quality emissions, create high-quality jobs, spur economic growth, and enhance the quality of life for the communities in San Benito and Santa Clara counties. Under the CPRG program, over $4.6 billion is designated for implementation of the measures outlined in these GHG reduction plans. The Santa Clara/San Benito County PCAP specifically included development of a community-scale reusable foodware system as a priority measure. The Cities of Sunnyvale, Mountain View, Cupertino and San Jose and County of San Benito applied for this CPRG grant as a coalition, with Sunnyvale as the lead agency. In addition to the grant application, as the lead agency, Sunnyvale is also required to submit an Memorandum of Agreement (MOA) signed by all the applying agencies.
EXISTING POLICY
General Plan Chapter 7, Goal EM-14 Recycling and Source Reduction Programs reduce solid waste through recycling, source reduction, education and special programs.
General Plan Chapter 7, Policy EM-14.1 Reduce generation of solid waste by providing source reduction programs and promoting reduction behavior.
ENVIRONMENTAL REVIEW
The Community-Scale Reusable Foodware Project that will be funded by this grant is exempt from the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15061(b)(3) based on the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA.
DISCUSSION
Sunnyvale’s zero waste strategies focus on efforts to reduce, reuse and recycle waste in that order. Staff are exploring ways to reduce single use foodware in the community. The City currently has ordinances that prohibit expanded polystyrene foam containers and serviceware and requirements to provide single use plastics accessories and condiments only upon request. Reusable foodware systems offer a compelling solution to the waste and pollution generated by single-use foodware. The City has recently tested a reusable foodware pilot where participating restaurants used reusables for dine-in customers. The coalition members for this proposed grant project recognize the pervasive issue of single-use waste and the negative environmental and community impacts that come from our use of disposables, and all partners have taken steps to try to address those impacts, from enforcing ordinances to various pilot projects.
A reusable foodware system provides ‘foodware as a service’ to Food Service Establishments (FSEs) to replace single-use foodware, such as cups and takeout containers. In such a system, a reusable foodware service provider supplies FSEs with reusable foodware for a per-use fee, similar in cost to single-use products that FSEs currently use. FSEs then serve takeout food and drinks to their customers in those reusable items. Customers return the reusable products to conveniently placed collection bins when they are finished using them. The current plan anticipates that each participating restaurant would have an indoor collection bin and outdoor collections bins would be located around the community at convenient curbside locations. The reusable foodware service provider collects, cleans, inspects, and repackages returned reusable foodware items before once again redistributing them to FSEs. The system would be designed to be convenient for all, profitable for the reuse service provider(s), free or low cost to users, and comparable in cost to using disposable products for participating businesses. The system design and enrollment efforts will be focused on restaurant takeout and delivery and reusable foodware for K-12 public schools. Sunnyvale is focusing on restaurants while other coalition members are also including schools.
For the development of this community-scale reusable foodware system, the coalition applied for CPRG implementation grant (Attachment 2) in the amount of $48,346,219, with City of Sunnyvale as the lead agency. City’s share in the grant proposal is estimated to be about $8 million. The grant proposal seeks funding for the following items:
• a comprehensive system design and implementation effort in the five coalition communities, including community outreach, and the necessary tasks and infrastructure, equipment, and supply investments to establish an effective reusable foodware system
• personnel costs for project development and implementation including adding a full-time position in Sunnyvale to manage the project and the grant funding for the 5-year grant term. City staff will get Council approval for a 5-year grant funded position if awarded the grant
• transition support for local restaurants as well as a subsidy to support operational expenses in the first four years
• necessary infrastructure costs for a system designed with two washing hubs, one serving the cities in Santa Clara County and one serving San Benito County. Cleaning infrastructure includes washing equipment, installation, retrofitting a facility, maintenance, and facility rent
• electric cargo vans for reusable item transport. The cost includes maintenance and insurance
• QR code scanners for tracking, reusable cups & containers, return bins for collection, transport containers for batching and moving clean items, and rolling bins for transporting dirty items
• participatory community design workshops with supplies, space, and incentives to encourage participation, including stipends provided to participants
• marketing campaign based on behavior research to provide consumer outreach and education for the initial launch and full launch of the system
As the lead agency, Sunnyvale will administer the grant funds, pass funds through to coalition members and sub awardees, and be responsible for reporting to and communicating with the EPA.
The lead applicant (Sunnyvale) must submit a Memorandum of Agreement (MOA) signed by all members of the coalition by August 1, 2024. Failure to submit a timely MOA may impact EPA’s ability to award the grant. The MOA (Attachment 1) provides documentation that the organizations have consulted with each other and are committed to fulfilling their respective roles and responsibilities to successfully implement the GHG reduction measures described in the application. Upon Council approval, Sunnyvale’s authorized personnel (City Manager) shall sign the MOA and staff can submit it to complete the application.
FISCAL IMPACT
The grant term for funding begins in approximately October 2024 and ends five years thereafter. No matching City funds are required to receive this funding. Budgetary actions to recognize and appropriate any awarded grants will be recommended in future budget processes. Per the current workplan (Attachment 2), City of Sunnyvale is budgeted to receive $1,399,484 for personnel and fringe benefits.
As fiscal agent and lead agency in the coalition, Sunnyvale has the primary responsibility to prevent cost overruns and ensure all project expenses are eligible under the grant. This does create some risk for Sunnyvale if project expenses were paid and then considered ineligible for the grant by the EPA through an audit. Additional costs of this mature have been capped in the MOA at $5,000 each for partner agencies except Sunnyvale.
Additionally, the Finance Department will need staff resources to serve as the fiscal agent for the project. These costs while not yet identified are expected to be reimbursed by the project. They will be added to the workplan when the grant project agreement is executed.
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 NOVA Workforce Services 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
Approve and authorize the City Manager to sign a Memorandum of Agreement between the cities of Sunnyvale, Cupertino, Mountain View, and San José, and the County of San Benito for the United States Environmental Protection Agency Climate Pollution Reduction Grant for Community-Scale Reusable Foodware System Design and Implementation.
Levine
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 $250 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
A check or “Y” 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
_Y_ General policy and legislative actions
Staff
Prepared by: Shikha Gupta, Solid Waste Programs Division Manager
Reviewed by: Ramana Chinnakotla, Director, Environmental Services
Reviewed by: Tim Kirby, Finance Director
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Kent Steffens, City Manager
ATTACHMENTS [Enter Attachment Titles here. Delete if not needed.]
1. MOA
2. Grant workplan