HomeMy WebLinkAbout6.3 GarbageRateAdj CITY CLERK
File # 810-30
AGENDA STATEMENT
CITY COUNCIL MEETING DATE: June 4, 2002
SUBJECT: Public Hearing: Adoption of Adjustment of Rates for Garbage Collection,
Disposal, and Recycling Services Provided By Livermore Dublin Disposal
Prepared by: Jason Behrmann, Administrative Analyst
EXHIBITS ATTACHED: 1. Rate Comparison
2. Comparison of Selected Rates Current versus Proposed
3. Resolution Adopting Rates
RECOMMENDATION: 1. Open the Public Hearing
c~c'/ 2. Receive the Staff Report and public testimony
3. Close the public hearing and deliberate
4. Adopt Resolution
FINANCIAL STATEMENT: The amount of the proposed rate increase varies depending on the type
of service received. There is no proposed increase for residential curbside customers. It is proposed that the
rates for commercial and drop box customers increase by approximately 15.46% and 2.35% respectively. The
proposed rates will be effective July 1, 2002.
DESCRIPTION:
The current garbage rates became effective July 1,2001. In accordance with the Agreement with Livermore
Dublin Disposal (LDD), the adopted rates were scheduled to be reviewed for a rate adjustment July 1, 2002.
The amount of the allowed adjustment was calculated in accordance with a specific formula. Additionally, per
Council direction at the May 21, 2002 City Council Meeting, it is proposed that commercial garbage rates be
increased'to fund a new commercial food waste recycling program.
Agreement with Livermore Dublin Disposal
The agreement between the City of Dublin and LDD requires the City to adopt a rate schedule, which is
estimated to produce a specified revenue amount. The target revenue amount is determined in accordance
with a specific schedule and formula. The annual adjustment takes into account (a) Changes in the Consumer
Price Index; (b) Changes in Landfill Regulatory Fees; (c) changes in number of subscribers and (d) an
adjustment for the number of tons placed in the landfill. After incorporating these adjustment factors, LDD
reviews the calculation of the proposed rates to determine whether the schedule is anticipated to meet the
adjusted revenue requirement. The formula places a 5% annual cap on the growth of total revenue estimated
to be received by LDD.
COPIES TO: Annette Borges, District Manager LDD
ITEM NO.
Total Estimated Revenues Required
Based upon the formula in the existing agreement, in Fiscal Year 2002-2003, LDD Revenue is increasing by
1.6%. The total annual revenue required under the Agreement for the period from July 1, 2002 through June
30, 2003 is approximately $4,794,974. Using the current subscriber census with the current rates, the
Company is projected to generate $4,719,472 in revenue. This results in the need for the proposed rate
structure to generate an additional $75,502, which will make up the shortfall.
At the May 21, 2002 City Council Meeting, The Council voted to implement a commercial food waste
recycling program. The cost of the program for Fiscal Year 2002-2003 is $278,900. Including the costs of this
program, the total revenue required is $5,073,874, which results in the need for the proposed rate structure to
generate an additional $354,402.
In addition to the Company revenue from rates, the City currently offsets a portion of the Residential
Recycling Program's cost with a separate payment of Measure D Funds. This includes both the Single Family
and the Multifamily recycling programs. The Fiscal Year 2001-2002 contribution is proposed at $48,000.
This assumption 'has been included in developing the proposed rates.
Detailed Comparison of Current and Proposed Rates
The proposed rate structure is estimated to approximate the Total Target Compensation of $5,073,874. The
actual percentage increase in the proposed rate depends on the type of service. For Fiscal Year 2002-2003 it is
proposed that residential rates remain unchanged while commercial rates increase by 15.46% and drop box
rates increase by 2.35%. Without the food waste program the commercial rates would increase by 2.19%. In
addition to funding the food waste recycling program, .this year's rate increases will create a greater incentive
for all commercial and drop-box customers to recycle.
Since the introduction of the 64 gallon co-mingled recycling carts in September 2000, residential recycling
tonnage has increased by over 50%. Commercial recycling on the other hand continues to struggle. City and
LDD Staff believe that this is largely due to Dublin's extremely low commercial garbage rates. The low
commercial rates make it difficult to encourage recycling. Typically businesses are more likely to recycle
when the cost of recycling is much lower than the garbage service. Dublin's current rates provide very little
incentive to recycle. Last year's commercial rate increase has made it somewhat easier to sell the financial
benefits of recycling, as evidenced by the 25% increase in commercial recycling accounts from a year ago.
However the 180 commercial recycling accounts still represent less than 1/3 of all commercial accounts. Even
with the increase, Dublin's commercial rates are at least 29% lower than the Tri-Valley average (See
Attachment 1).
The following example illustrates what a typical business can save by recycling with the new rates:
Service Without Recycling
2 4 yard bins 3x week Garbage $1,054.84
Service With Traditional Recycling
1 4 yard bin 2x week Cardboard $183.00
2 4 yard bin 2x week Garbage $696.22
Monthly Total $879.22
A SAVINGS OF $175.62 PER MONTH
Service with Traditional and Food Waste Recycling
1 4 yard bin 2x week Cardboard $183.00
1 4 yard bin 2x week Food Waste $278.49
1 4 yard bin 2x week Garbage $348.11
Monthly Total $809.60
AN ADDITIONAL SAVINGS OF $69.62 PER MONTH
TOTAL SAVINGS OF $245.24 OR $2,942 PER YEAR
The ability to significantly reduce garbage rates by participating in the City's commercial recycling programs
should encourage more Dublin businesses to recycle and help increase the City's diversion rate.
The proposed drop-box service rate increase is 2.35%. Drop-box tonnage is largely attributed to construction
and demolition projects in the City. In 2001, drop box tonnage represented nearly 31% of the total disposal
tonnage in the City. While this number is decreasing largely due to the City's Construction and Demolition
Ordinance, the new rates will provide an even greater incentive to recycle more of the debris. The rate increase
is intended to bring Dublin's rates closer to the Tri-Valley average. The new drop-box rates would still be
below the Tri-Valley average. Attachment 2 compares the proposed rates to the current rates for service levels
which represent a majority of the subscribers in the City. The proposed rates would be effective July 1, 2002.
Competitiveness of Dublin Rates with Neighboring Agencies
As shown in Attachment 1, the proposed City of Dublin rates remain very competitive compared to rates
charged for similar services in surrounding communities. In all cases, the City of Dublin service levels are at
least comparable~ and in some cases better than the survey cities. For example, Pleasanton offers Residential
Green Waste collection only every other week. Therefore, the City of Dublin residential subscribers receive
more services. For most rate categories, the proposed City of Dublin rates are well below the average of the
Tri-Valley agencies surveyed°
Recommendation
Attached to the Agenda Statement is a Resolution (Attachment 3), which will establish the Adjusted
Livermore Dublin Disposal Rate Schedule in accordance with the Franchise Agreement, under which the
Company operates inthe City of Dublin°
Staff recommends that the City Council conduct a Public Hearing and adopt the Resolution.
2001 Garbage Rate Comparison Survey ,
(Prepared By City of Dublin May 2002)
Printed: 5/28/2002 16:23 # Dublin Proposed % Proposed Current % Increase
Residential Livermore Pleasanton San Ramon Average Dublin From Avg Rate over 2001/2002
1Can Residential (32-35 Gallon) $ 11.60 $ 22.30 $ 11.50 $ 15.13 $ 10.15 -33% $ 10.15 0.00%
2 Can Residential (64-70 Gallon) $ 21.65 $ 16.73 $ 19.19 $ 18.65 -3% $ 18.65 0.00%
% Dublin Customers Covered By Sample Rate Categories: 97%
Residential Notes:
Dublin: Basic rate includes 35-gallon can supplied by LDD (weekly pick-up);Weekly 64-gallon green waste can supplied by
LDD; weekly curbside recycling collection; and 3 special curb-side clean-ups per year
Livermore: Basic rate includes a 30-35-gallon can supplied by customer, picked up weekly; 96-gallon green waste can
supplied by LDD; weekly curbside recycling; and 4 curbside clean-ups per year
San Ramon:Basic rate includes 35-gallon can supplied by Garbage Co. (weekly pick-up); 96-gallon green waste can supplied by Company;
weekly curbside recycling, and three special clean-ups per year.
Pleasanton: Basic rate includes 90-gallon can (recycling + garbage) supplied by company (weekly pick-up); 64-gallon green waste can
(picked up every other week); no separate container for recyclables; 1 extra green-waste pick-up per year; no special curbside clean-ups
3 City Proposed % Proposed Current % Increase
Commercial Livermore Pleasanton San Ramon Average Dublin From Avg Rate over 2001/2002
1Yard-ltime/wk $ 51.88 $ 84.33 $ 70.00 $ 68.74 $ 42.20 -39% $ 36.55 15.46%
2 Yard- 1 time/wk $103.76 $ 168.55 $130.00 $134.10 $ 84.40 -37% $ 73.10 15.46%
3 Yard - 1 time / wk $155.64 $ 240.82 $180.00 $192.15 $126.60 -34% $109.65 15.46%
3 Yard - 2 times / wk $ 332.84 $ 445:36 $ 360.00 $ 379.40 $ 263.71 -30% $ 228.40 15.46%
4Yard- 1 Time/wk $207.52 $ 313.54 $220.00 $247.02 $168.80 -32% $146.20 15.46%
4 Yards - 2 times / wk $ 436.60 $ 586.26 $ 440.00 $ 487.62 $ 348.11 -29% $ 301.50 15.46%
% Dublin Customers Covered By Sample Rate Categories: 73%
Drop Box
20 Yard Loose $ 241.60 $ 251.40 $300.00 $264.33 $ 261.00 -1% $ 255.00 2.35%
30 Yard Loose $362.40 $ 377.10 $450.00 $396.50 $391.50 -1% $382.50 2.35%
40 Yard Loose $ 483.20 $ 502.80 $ 600.00 $ 528.67 $ 522.00 -1% $ 510.00 2.35%
30 Yard Compacted $ 724.80 $ 754.20 $ 900.00 $ 793.00 $ 783.00 -1% $ 765.00 2.35%
% Dublin Customers Covered By Sample Rate Categories: 84%
Every effort has been made to assure the accuracy of the information and comparison of similar levels of service according to our understanding of other agency rates.
COMPARISON OF SELECTED RATES CURRENT
vs PROPOSED
Proposed
Current Proposed % Increase over
Residential -Monthly Rates Rate 2002/2003 2001/2002
Minimum Residential (35) Gallon $10.15 $ 10.15 0.00%
64 Gallon Residential $18.65 $ 18.65 0.00%
Sample rate categories represent 97% of residential customers
Additional Green Waste Recycling Can: $4.00 per can per month - (no change)
Multi-Family Recycling (per unit): $ 0.60 $ 0.60 0.00%
Commercial -Monthly Rates
1 Yard - 1 time / wk $ 36.55 $ 42.20 15.46%
2 Yard - 1 time / wk $ 73.10 $ 84.40 15.46%
3 Yard - 1 time/wk $ 109.65 $ 126.60 15.46%
3 Yard - 2 times / wk $ 228.40 $ 263.71 15.46%
4Yard- 1 Time/wk $ 146.20 $ 168.80 15.46%
4 Yards- 2 times/wk $ 301.50 $ 348.11 15.46%
Sample rate categories represent 73% of commercial customers
Drop Box - Rates Per Service
20 Yard Loose $ 255.00 $ 261.00 2.35%
30 Yard Loose $ 382.50 $ 391.50 2.35%
40 Yard Loose $ 510.00 $ 522.00 2.35%
Represents 87% of 2001 non-compacted Drop Box Subscriptions
30 Yard Compacted $ 765.00 $ 783.00 2.35%
Represents 74% of the 2000 compacted Drop Box Subscriptions
Handy Hauler Available To Residential $ 60.70 $ 60.70 0.00%
ATTACHMENT 2
RESOLUTION NO. - 2002
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
AMENDING THE SCHEDULE OF SERVICE RATES
FOR INTEGRATED SOLID WASTE SERVICES
WHEREAS, the City of Dublin adopted on June 13, 1995, a Franchise Agreement with Waste Management
of Alameda County; and ,
WHEREAS, the City Council also adopted Resolution 080-01 on June 5, 2001, which established service
rates to be effective July 1,2001; and
WHEREAS, the Agreement provides for consideration of the sixth adjustment to the rates in accordance
with specified formulas to be effective July 1, 2002; and
WHEREAS, the City Council has considered this action as part of a noticed public hearing on June 4, 2002.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin does hereby adopt
the Rate Schedule attached hereto, marked Exhibit A and by reference made a part hereof.
BE IT FURTHER RESOLVED that, upon the effective date, July 1, 2002, this resolution shall supersede
all previous resolutions adopting rates for solid waste services, and the rates adopted by this resolution shall continue
from year to year.
PASSED, APPROVED AND ADOPTED this 4th day of June, 2002.
AYES:
NOES:
ABSENT:
ABSTAIN:
Mayor
ATTEST:
City Clerk
ATTACHMENT 3
PROPOSED ADJUSTMENT TO GARBAGE COMPANY RATES
Affected Parcels
Chapter 5.32 of the Dublin Municipal Code requires for the protection of the health safety and welfare of the community
that all parcels obtain minimum weekly garbage service. Livermore Dublin Disposal is the authorized garbage collection
and disposal firm operating within the City. The agreement between the City of Dublin and Livermore Dublin Disposal
provides that the City shall adopt a rate schedule which is estimated to allow the Company to achieve a fixed amount of
annual revenue. Therefore, the adoption of these fees will affect all parcel owners. Rates are effective July 1, 2002.
Basis of Fees
The City has .negotiated a multi-year agreement with Livermore Dublin Disposal. The Company may request a change in
rates based upon a formula which includes: changes in the Consumer Price Index; Increased Regulatory Fees; and
changes in the total tons delivered tothe Landfill. The additional costs of each of these components has been allocated to
the three classes of servicei Residential; Commercial Bin Service; and Drop Box/Compactor.
RESIDENTIAL RATES
Company Minimum Residential Collection Rate: Applies separately to each single family unit as well as each unit
within a duplex or other attached housing, which receives individual garbage collection services. The rate applies to the
initial 35 gallons of garbage capacity, including once per week collection and disposal; 3 annual special curbside clean-
ups; Weekly Curbside Residential Recycling; and Weekly Curbside Green Waste Recycling (64 gallon container). All
containers are provided by the Company.
Company Minimum Monthly Rate: $10.15
Residents may select a larger garbage container for an additional fee which is shown below:
64 Gallon Garbage Container: Minimum Cost Plus $ 8.50 per month (Total = $18.65 per month)
96 Gallon Garbage Container: Minimum Cost Plus $17.00 per month (Total = $27.15 per month)
Special Residential Services
Large Accumulations: $11.80 per cubic Yard
Special Pick-Ups: $12.80 minimum per pick-up
Additional Green Waste Container: $4.00 per container
COMMERCIAL AND MULTI-FAMILY BIN SERVICES (FRONT-END LOADER)
Excess Rate For Waste Which Exceeds water level: $13.05 per cubic yard
Commercial Can Service: Offered at locations unable to accommodate a commercial bin or with volumes deemed
insufficient to utilize a commercial bin. Monthly rate includes bin rental and once per week collection and disposal.
35 Gallon Container: $10.15 64 Gallon Container: $18.65 96 Gallon Container: $ 27.15
Multi-Family Recycling Service: Multi-Family rates for Recycling are charged by the Company on the number of
units located in the complex.
Monthly Cost: $ 0.60 per unit
Commercial Bin Service Rates
Rates shown on the following page are monthly rates based upon bin size and frequency of service. Rates include
collection, disposal, and bin rental.
EXItlBIT A
Size # # Times Base Monthly Size # # Times Base Monthly
YARDS Per Wk Rate YARDS Per Wk Rate
1 I $42.20 4 1 $168.80
1 2 $94.91 4 2 $348.11
I 3 $147.62 4 3 $527.42
I 4 $200.33 4 4 $706.73
I 5 $253.04 4 5 $886.04
4 6 $1,065.35
2 I $84.40 6 1 $253.20
2 2 $179.31 6 2 $516.91
2 3 $274.22 6 3 $780.62
2 4 $369.13 6 4 $1,044.33
2 5 $464.04 6 5 $1,308.04
3 1 $126.60 7 1 $295.40
3 2 $263.71 7 2 $601.31
3 3 $400.82 7 3 $907.22
3 4 $537.93 7 4 $1,213.13
3 5 $675.04 7 5 $1,519.04
SMALL COMPACTOR SERVICE: Rates for small compactors serviced as a commercial account on a
regular route shall be billed by container size at the rate of two times the stated rate above for loose garbage.
HANDY HAULER - One-time placement and collection of a 4 cubic yard bin, including one week container rental
filled no higher than water level: $60.70
Additional Bin Rental Per Week: $10.70 per week Cost For Additional Dump: $44.00 / pick-up
Excess Per Yard If Filled Above Water Level $13.05 per cubic yard
DROP BOX / COMPACTOR RATES
Cost shown is on a per pick-up basis and is based upon the load not exceeding water level (Exces is charge the same
rate). Additional Miscellaneous charges may also apply. Rate Per Cubic Yard: Non-Compacted: $13.05
Compacted: $26.10
MISCELLANEOUS DROP BOX CHARGES
I Drop Box Flasher Initial Placement of Drop Box Stand-By Time
$12.75 per placement $25.00 $85.10 per hr.
Weekly Drop Box Container Rental Cancel Auto Pick-Up
Relocation of Drop Box After 1 st Week Without Notice
$38.10 per request $14.90 Per Week $48.00