On April 28, 2016, the City of Plano entered into a Memorandum of Understanding (MOU) between the North Texas Municipal Water District and the Cities of Allen, Frisco, McKinney, and Richardson to accept and process yard debris and produce sellable compost and mulches under the Texas Pure Products brand. The original agreement established a requirement for all Member Cities, including Plano, to deliver all acceptable material collected in their respective cities to a NTMWD compost program facility.
The Texas Pure Products compost operation is the lowest cost alternative for processing yard debris for the City of Plano. The program receives residential yard waste through curbside pickup and drop-offs and then processes the material into compost and mulch that is sold to generate revenue to offset costs. The alternative to the compost program would involve the collection and landfilling of yard debris without any revenue source other than increased residential rates to cover the collection and landfilling costs.
On November 7, 2023, City Council approved the First Modification to the MOU to address increasing operating costs, capacity limitations, and participation structure within the program.
Neither the original MOU nor the First Modification included provisions for the year-end financial reconciliation of program revenues and expenditures. In order to provide transparency and ensure equitable allocation of program revenues and expenses among participating cities, City of Plano staff negotiated a Second Modification of the agreement with NTMWD and the Member Cities.
This Second Modification of the MOU includes the following:
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Establishes an annual financial reconciliation process for surplus or deficit funds.
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Provides that, if total revenues exceed total expenditures, Plano will calculate the surplus and present recommended options to the Member Cities. If unanimous agreement is not achieved, surplus funds will be returned to the Member Cities on a pro rata basis according to actual tonnage delivered.
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Provides that, if total expenditures exceed total revenues, the resulting deficit will be allocated to the Member Cities on a pro rata basis according to actual tonnage delivered, with reimbursement to Plano required within 90 days of invoice.
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Establishes an effective date of October 1, 2025, and includes a provision to participate in and complete negotiations by September 30, 2028 for any future operational changes to the Program.
Failure to approve this modified Memorandum of Understanding between the City of Plano, the North Texas Municipal Water District, and the four partner cities of Allen, Frisco, McKinney, and Richardson, in combination with the modified Interlocal Agreement (ILA) presented as a separate Agenda Item, would result in misalignment between governing documents and limit the ability to implement the agreed-upon financial reconciliation process.