PILLAR: Livable
AGENDA DATE: November 10, 2026
COUNCIL DISTRICT(S): Citywide
DEPARTMENT: Department of Sanitation Services
PRIORITY: N/A
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SUBJECT
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Authorize a third amendment to the Materials Recovery Facility Develop, Operate, and Manage Contract, as amended, with FCC Environmental Services Texas, LLC and Fomento de Construcciones y Contratas, S.A. dba FCC, S.A. to temporarily modify revenue sharing, host fees, and recycling education contributions for an initial three year period with two one-year renewal options, while continuing recycling processing services at McCommas Bluff Landfill without a City processing payment - Estimated Revenue Foregone: Sanitation Operation Fund approximately $3,000,000.00 (over a three-year term)
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BACKGROUND
On September 9, 2015, the City Council authorized the development, construction, operation, and management of a materials recovery facility and a concurrent ground lease with Fomento de Construcciones y Contratas, S.A. dba FCC, S.A. (“FCC Spain”), by Resolution No. 15-1650. Operations began January 2, 2017.
On April 10, 2019, the City Council authorized the first amendment by Resolution No. 19-0503, temporarily adjusting certain host fees and extending the primary contract term through January 1, 2035, subject to applicable extensions. The second amendment, effective August 28, 2020, approved assignment of the contract to FCC Environmental Services Texas, LLC (“FCC Texas”), while retaining FCC Spain’s continuing liability for contract obligations.
FCC Texas has requested concessions because weak commodity markets and rising processing costs have resulted in continuing financial impacts. Following staff review and an independent consultant’s validation of relevant documentation, staff recommends approval.
The proposed amendment would:
Establish an initial three-year adjustment period, with two additional one-year periods available by mutual w...
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