Council approves $45M SmartStation NextGen upgrades, funding with solid-waste revenue bonds

Sunnyvale and partner Mountain View will modernize the joint SmartStation municipal solid-waste and recycling facility after the City Council approved equipment contracts, accepted grant funding and authorized financing for the project.

Environmental services director Ramana Chinnakota told the council staff had run a multi-year procurement and selected Bulk Handling Systems (BHS) as the preferred vendor to supply the integrated processing line and Shredding Systems Incorporated (SSI) to supply a preload garbage compactor. Chinnakota called the procurement “a joint effort between the finance department and the environmental services department,” and he praised staff and consultants who conducted evaluations and negotiations.

Nut graf: The project replaces aging equipment at the SmartStation with one integrated line and supporting conveyors, six optical sorters and other equipment. Staff estimated a project budget of about $51.4 million gross, reduced to roughly $44.84 million after a CalRecycle grant. Contracts before council were: a not-to-exceed services agreement with BHS (about $34.54 million), and a purchase agreement with SSI (about $2.512 million), plus contingencies and a $16.75 million budget modification. Council also approved a resolution declaring intent to reimburse project expenditures from future solid-waste revenue bonds; staff said proposed debt service is built into the FY 2025–26 budget and long‑term financial plan.

What council approved and why: Projected outcomes include higher recovery and cleaner commodities: facility‑wide diversion from about 50% to about 65%, source‑separated recycling purity improvements (from roughly 87% to about 90%), and organic recovery from mixed waste increasing toward 75% (helping meet state organics rules such as SB 1383). Deepti/Deepi Jain, environmental programs manager, and Sheikha Gupta, solid‑waste manager, explained the hybrid design uses some existing trommels and conveyors alongside new equipment to increase recovery while limiting civil work. Chinnakota noted the facility will be partially offline during construction (staff expect the garbage processing line will be out for roughly six months; staff plan to stagger decommissioning so other streams such as organics, yard trimmings and C&D continue processing).

Funding and schedule: Staff said an approved CalRecycle grant of about $6.575 million reduces the city’s net carry. The city plans to issue roughly $45 million in solid-waste revenue bonds to finance the project; estimated annual debt service is roughly $3.4 million. Staff said they are working with Mountain View as a partner (Mountain View pays by tonnage share) and are seeking additional partner cities to share facility costs. Staff estimated equipment installation and commissioning would take approximately 18 months.

Council vote and next steps: Council voted 7‑0 to accept the addendum to the original EIR, award the BHS and SSI contracts (with standard contingencies), approve budget modification #24, and adopt the intent-to-reimburse resolution for bond financing. Staff said they will finalize the CalRecycle contract and proceed with procurement and construction scheduling. The council directed staff to manage the facility outage so household recycling, yard‑trimming and food‑scrap collection remain available where possible and to report back as construction proceeds.