1997 AGN OCT 21 I24 - Laserfiche WebLink

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MEMORANDUM Office of the City Attorney October 9, 1997 Page 3 regarding the extent of its operations within the City. For a long period of time, Jack's refused to deliver a list of its customers despite repeated requests from the City. During May of 1996, when it became clear that Jack's was not going to be awarded to competitively bid contract for waste hauling services, Jack's made a dealwith Browning-Ferris Industries, Inc. ("BFI") to extend Jack's service to cover all BFI accounts. Jack's took the position that it was entitled to compete for all commercial accounts and that it was not restricted to only those accounts held prior to the commencement of the competitive bidding process. A series of negotiations went on during June of 1996 with Jack's and the BFI accounts were finally released for servicing by Taormina prior to the July 1, 1997 start date for Taormina's contract. During the summer and fall of 1996, Taormina attempted to purchase Jack's Colton accounts and Taormina's representative, Dave Ault, repeatedly urged the City to audit Jack's accounts because _ he reported that the value of those accounts as represented to Taormina were far in excess of the dollar amounts on which Jack's had been paying a franchise fee under its agreement. Notice was initially given to Jack's in June of 1996' of the City's intent to terminate Jack's franchise agreement for breach of some of its provisions. Jack's cured that breach in the time frame permitted in the agreement. The City further notified Jacks' in June of 1996 that the City would be auditing its accounts. On June 27, 1996, Ms. Bonnie Johnson of the Finance Department in fact went to Jack's to conduct an audit. She met with some initial hostility, but was given most of the information she requested. At the direction of then City Manager Nabar Martinez, all audit efforts by the Finance Department were suspended after this initial contact pending the City's retaining of a franchise audit firm. In late August of 1996, Municipal Resource Consultants ("MRC"), a consultant originally retained to audit the utility users tax collectors within the City, was directed to conduct an audit of Jack's accounts in liaison with the Finance Department. Authorization for issuance of a subpoena was given in early September of 1996. In early October, the Finance Department` was notified by this office as follows: "You should know that there is considerable frustration on the part of the City Council and the City Manager with the time that it has taken to move forward on this matter. I am hopeful that now that MRC has been fully apprised of the City's concerns with regard to Jack's that the matter will move forward very quickly." On October 9, 1996, Jack's was once again put on notice of violation of the franchise agreement due to inadequate and incomplete response to MRC's requests. for