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Item 6.1 AVI Garbage Rates
Cti~~OFDU~lr~ .CITY CLERK ~~l ~ ~~1 File # ^®©©'©© 19 `V' ~~ 8Z ~~ ~~ ~~LIFOR~1~ AGENDA STATEMENT CITY COUNCIL MEETING DATE: June 23, 2009 SUBJECT: Public Hearing: Adoption of Rates for Garbage Collection, Disposal, and Recycling Services Provided By Amador Valley Industries and Establishing the 2009-2010 Annual Assessment Report Prepared by Roger Bradley, Administrative Analyst ATTACHMENTS: 1. Section 5.11 of the Collection Service Agreement 2. Methodology Used For Fiscal Year 2009-2010 Rate Adjustment 3. Proposed vs. Current Rates 4. Tri-Valley Rate Comparison 5. Resolution Approving the Third Contract Amendment 6. Resolution Adopting Rates 7. Resolution Establishing Annual Property Related Fee RECOMMENDATION: 1. Open the Public Hearing. 2. Receive the Staff Report and public testimony. 3. Close the public hearing. ~ 4. Deliberate. S. Adopt Resolution approving the Third Amendment to the Agreement with Amador Valley Industries, LLC for Solid Waste Collection Services. 6. Adopt the Resolution establishing the Amador Valley Industries Rate Schedule in accordance with the Franchise Agreement. 7. Adopt the Resolution establishing the Annual Rate to be levied for Basic Service on the residential property tax bill. 8. Direct Staff to work with AVI to amend the Collection Service Agreement to adjust the cap on the Refuse Rate Index (RRI) to 10.00% and incorporate a Loca170 index into the RRI calculation for the Fiscal Year 2010-2011 rate adjustment, based upon meeting the criteria established in Section 5.11 of the Collection Service Agreement for an extraordinary adjustment. FINANCIAL STATEMENT: It is proposed that the solid waste rates in the City of Dublin be increased by approximately 5.07%, based on the adjustment formula included in the City's solid waste collection services agreement with Amador Valley Industries (AVI). The rate adjustment formula takes into consideration the increase in various cost indices. An annual fee is collected on the property tax bill COPY TO: Amador Valley Industries Page 1 of 5 ITEM NO. H:\Garbage Assmt\2009_2010 Assmt\Agenda\agenda_stmnt_GarbageRates.doc DESCRIPTION: In January 2005, the City executed the collection service agreement with Amador Valley Industries (AVI) for service that began July 1, 2005. The agreement between the City and AVI requires the City to adopt a rate schedule, which is estimated to produce a specified revenue amount as identified in the Agreement. The Agreement provides for an annual adjustment to the total revenue based on economic indices applied to the base cost that was part of AVI's original proposal. The adjustment formula also factors in growth in the number of customers and disposal tonnage. The City has also adopted an Ordinance, which requires all parcels in the City to subscribe to weekly minimum garbage service. For residential properties that are serviced with individual containers, the City collects the annual cost of minimum service with the property tax bill. This minimum service includes: weekly curbside collection of a 32 gallon garbage container; up to two (2) organic waste carts, including food scraps (96 gallons each); up to two (2) recycling carts (96 gallons each); recycling collection of used oil and filters; an annual household hazardous waste drop off event; and three on-call bulky waste pick- ups per year. Residents desiring larger garbage carts are billed directly by the Company for the incremental rate difference. The City pays AVI for the service cost of minimum residential service with monies collected from the property tax bill. CONTRACT AMENDMENT The Agreement with Amador Valley Industries (AVI) provides for an annual rate adjustment based on a compensation model presented within the Collection Services Agreement. One inflationary factor used within the adjustment methodology to determine the amount of rate increases is the Refuse Rate Index (RRI), defined in Section 5.05.1.1 of the Agreement. This index is applied to the various compensation elements within the model as a percent increase in compensation for the next year's rates. The RRI factor is similar to, and functions exactly like, the well known Consumer Price Index (CPI), except that it is benchmarked to indices relevant to the refuse collection industry. When Staff and AVI began preparations for the annual rate adjustment for Fiscal Year 2009-2010, it was noted that the Bureau of Labor Statistics no longer produces the indices used to calculate the RRI. Staff and AVI have worked to find comparable indices for incorporation into the rate model in place of the discontinued indices. The table below lists the discontinued indices indicated as Operating Cost Components in Exhibit 2, Page 78, of the Collection Services Agreement and the proposed replacement indices. Amending the Collection Services Agreement to replace the defunct indices will allow for the continued adjustment of the collection rates as required by the Agreement. Thus, Staff recommends that the City Council adopt the Resolution approving a Third Amendment to the Agreement with Amador Valley Industries, LLC and authorizing the City Manager to execute the Amendment to incorporate these proposed indices. It will be necessary for the City Council to adopt the proposed Resolution before adopting the proposed rates for Fiscal Year 2009-2010. Page 2 of 5 RRI Calculation Components Formula Com anent Current Index Pro osed Index Labor Waste Collection-Average Hourly Earnings Waste Collection-Average Hourly Earnings (ceu60566210006) (ceu60566210008) Vehicle Replacement Motor Vehicle Mfg-Vehicles on Purchased Transportation Equipment-Truck & Bus Chassis Bodies Sold Separately ( cu3362113362113) ( u141301) Vehicle Maintenance Industrial Truck & Tractor Mfg.-Parts for Machinery & Equipment-Parts, Attachments Industrial Work Trucks and Accessories ( cu3339243339243) ( u11440378) All Other Industrial Truck & Tractor Mfg.-Parts for Machinery & Equipment-Parts, Attachments Industrial Work Trucks and Accessories ( cu3339243339243) ( u11440378) AVI REQUESTED ADDITIONAL CONTRACT AMENDMENT During its work on the rate adjustment with AVI, Staff was approached about the possibility of amending two of the contract provisions. The first provision AVI requested be changed is an adjustment of the cap on the RRI factor, which is 5.00%. The concern presented by AVI is that it has experienced extraordinary cost increases over the past year, which would have been accounted for in the annual rate adjustment if the cap were removed. Using the new indices as outlined above, and if there were no contract provision to hold the RRI factor to 5.00% or less, the RRI factor for the rate adjustment in Fiscal Year 2009-2010 would be 15.62%. The proposed use of the new indices is a significant contributor to the increased RRI factor. It is unknown whether such an increase would have been obtained using the previous indices, but given conditions last year, and that the proposed indices are of a similar type, it is possible that it would have been similar. The second request presented by AVI was to look at changing the "All Other" component of the RRI factor. Specifically, AVI would like to have this category linked to the contract it has with the Loca170 Union or with its drivers. As part of the Loca170 strike with Waste Management two years ago, AVI was required to accept concessions that significantly increased its personnel cost structure. AVI feels that having this category included as a rate escalation index within the RRI factor, would more appropriately adjust the rates each year to meet AVI true compensation needs. Staff has met with AVI and determined that the economic conditions experienced by AVI meet the requirements as set forth in Section 5.11 of the Collection Service Agreement (Attachment 1). This section states that compensation adjustments can be made "... on the basis of extraordinary and unusual changes in the costs of operations or programs..." AVI indicates that its cost structure has been adversely affected by the economic downturn; as a result, the cap on the RRI factor and exclusion of the labor contract costs from the RRI calculation prevents its full financial recovery. Staff concurs with AVI's reasoning that the current economic downtown was something that was unforeseeable and that the financial stability of the Collection Service Agreement may be affected. Based solely on meeting these conditions, Staff recommends proceeding with AVI's request. AVI has indicated that there will not be a need for additional contract amendments throughout the term of the Agreement, unless additional extraordinary circumstances were to occur. If the City Council has interest in amending the contract to address AVI's concerns, it is Staff s recommendation that the contract be amended to create a 10.00% cap on the RRI factor and to create an Page 3 of 5 index for the Local 70 contract. AVI has indicated that a 10% cap would be acceptable. Allowing for the adjustment of the cap, AVI will be in a better position to manage the cost fluctuations that have occurred as a result of the unexpected economic shift this past year. If a 10% cap would have been in place in the current contract, the Dublin ratepayer would have had to absorb an additional $314,219 in Fiscal Year 2009-2010, both residential and commercial. Additional Calculated RRI FY 08-09 Revenue Rate Compensation RRI Cap Value Compensation from RRI Increase per the Rate Difference Factor ~ 09-10 Model With 5% Ca 5.00% $7,438,738 $371,937 5.07% $7,765,190 -- With 10% Ca 10.00% $7,438,738 $743,874 9.33% $8,079,409 $314,219 Without RRI Ca 15.62% $7,438,738 $1,161,931 14.12% $8,432,265 $667,075 The RRI cap was negotiated as part of the contract for services with AVI, which ends June 30, 2012 with an option for three one-year extensions, before service provision began. This item was included to protect the Dublin ratepayer from exorbitant increases in the annual rate adjustment as a result of extreme economic fluctuations and to ensure the stability of the rate system. GARBAGE RATE CALCULATION Garbage Rate Background The current garbage rates became effective July 1, 2008. The agreement with AVI provides a process for addressing the compensation generated from all rate classes on an annual basis. The agreement establishes a total annual revenue requirement for the Company. The City retains the responsibility to establish the rates for all categories, with the provision that rates must be reasonably forecasted to provide the compensation to AVI as provided for in the Agreement. The forecasting uses census numbers based on service levels multiplied by the new rates. As required in the Agreement, the City has provided AVI with information showing the rate calculations and assumptions. Section 5.13.1 states "...the final decision of the rate structure rests solely with the City." The proposed rate structure for Fiscal Year 2009-2010 is estimated to meet the compensation requirement of $7,717,613. This compensation is possible as a result of a proposed 5.07% increase to all rate categories and a proposed 19.53% increase in the Commercial Recycling Compensation Element. A detailed description of the methodology required by the Agreement is included as Attachment 1. Detailed Comparison of Current and Proposed Rates Attachment 2 compares the proposed rates to the current rates for service levels that represent a majority of the subscribers in the City. The proposed rates would be effective July 1, 2009. Competitiveness of Dublin Rates with Neighboring Agencies As shown in Attachment 3, the proposed City of Dublin rates remain very competitive compared to rates charged for similar services in surrounding communities. In most cases, the City of Dublin service levels are at least comparable, and often better than the survey cities. For example, Pleasanton does not offer any bulky waste pick-ups, and Livermore and San Ramon charge extra for many items, such as electronic waste and appliances, which AVI will pick up free of charge for Dublin residents. Therefore, the City of Page 4 of 5 Dublin customers receive more services. For most rate categories, the proposed City of Dublin rates are similar and in all cases below the average of the Tri-Valley agencies surveyed. Annual Fee for Minimum Residential Garbage Service The City Council will need to establish the annual fee, which is collected with the property tax for residential properties, separately from the rates for other levels of service. The proposed fee for Fiscal Year 2009-2010 is $171.00, which equates to $14.25 per month. This is a $0.69 per month increase over the rate levied in Fiscal Year 2008-2009. This base rate includes $0.25 per month which is collected for the purpose of funding the cost associated with collection of the property tax bill. These funds are not paid to AVI. In addition, the cost of collection and delinquencies for the basic service are expected to be covered from the following sources: prior year fund balance; penalties and prior year taxes collected by the County Tax Collector; and interest on funds held prior to payment to the Company. The following table shows the historical annual assessments: Historical Annual Fee For Minimum Garbage Service Collected With Property Tax Bill 2005/06 2006/07 2007/08 2008/09 Proposed 2009/10 $146.04 $154.08 $156.48 $162.72 $171.00 RECOMMENDATION: Staff recommends that the City Council: 1) Open the Public Hearing; 2) Receive the Staff Report and public testimony; 3) Close the public hearing; 4) Deliberate; 5) Adopt Resolution approving the Third Amendment to the Agreement with Amador Valley Industries, LLC for Solid Waste Collection Services; 6) Adopt the Resolution establishing the Amador Valley Industries Rate Schedule in accordance with the Franchise Agreement; 7) Adopt the Resolution establishing the Annual Rate to be levied for Basic Service on the residential property tax bill; and 8) Direct Staff to work with AVI to amend the Collection Service Agreement to adjust the cap on the Refuse Rate Index (RRI) to 10.00% and incorporate a Local 70 index into the RRI calculation for the Fiscal Year 2010-2011 rate adjustment, based upon meeting the criteria established in Section 5.11 of the Collection Service Agreement for an extraordinary adjustment. Page 5 of 5 ~ ~ , _. ~ ~~ Collection Service Agreement 1819 its sole discretion, may consider the request for the annual Collection Compensation 1020 dement adjustment. 1021 5.11 Extraordina Adjustment. 1 q22 5.11.1 CONTRACTOR may petition the CITY in writing at any time for an 1023 additional compensation adjustment an the basis of extraordinary and unusual changes 1024 in the costs of operations ^r programs that satisfy all of the following conditions: (i) 1 q25 materially alters CONTRACTOR'S operations or overall costs; (ii) could not reasonably ig28 have been foreseen by a prudent operator; (iii) which, by all reasonable expectations will 1027 continue for a period of at least six {G) months; and (iv) is not addressed pursuant to 1028 Article 27. CONTRACTOR'S request shall contain substantial proof and justirfiCation to 1029 support the need far the Compensation adjustment. The CITY may request from the 103q CONTRACTOR such further information as it deems necessary to fully evaluate the 1031 request and make its determination. The CITY shall in the exercise of its reasonable 1g32 discretion approve ar deny the request, in whale ar in part, within sixty (60) calendar ig33 days of receipt of the written request and all other additional information requested by 1034 the CITY. 1035 5.11.2 No Extraordinary Adjustment shall occur or additional 1036 compensation be provided due to the CONTRAGTOR's use of any facility or service 1037 provider other than as set forth in Article 1 of this Agreement. Nor shall a variation from 1038 the CONTRAGtOR's estimate for equipment and personnel required, or the tonnages of 1039 Solid Waste, Recyclable Materials or Organic Wastes be collected, processed or 1040 disposed provide a basis for an increase in compensation through an Extraordinary 1041 Adjustment or otherwise, except as specifically provided for by the Annual 1042 Compensation Adjustment Process set forth in Section 5.05_ 1043 5.12 Calculation of Service Rates. CITY shall calculate, set and maintain 1044 service rates at a level, based on the revenue forecasted to be received by 1045 CONTRAGTOR from charging such rates that can reasonably be expected to provide 1046 compensation to the CONTRACTOR as calculated in Section 5.05 above. 1047 5.13 Initial Calculation. In preparing the initial service rate calculations, CITY 1848 shall use the event Census data shown on exhibit 2. As part of the rate calculation 1049 process, CITY shall provide the rate calculations and assumptions to the 1050 CONTRACTOR for their revievy. However, the final decision of the rate structure rests 1051 solely with the CITY 1052 5.13.1 Subse uent Calculations_ in preparing subsequent service rate 1053 calculations, CITY may use the most current event census data available_ As part of the 1054 rate calculation process, CITY shall provide the rate calculations and assumptions to the 1055 CONTRACTOR for their review. However, the fine! decision of.the rate Structure rests 1056 solely with the CITY. 1057 5.14 Cam ensatian Variances, CONTRACTOR shall retain any_Campensation 1058 in excess of that calculated in Section 5.05 above and shalt not be entitled to any 1059 additional revenues if compensation is less than calculated in Section 5.05 above_ ~~n -- 1 ~~ ~~ s ~ "",T Page 30 City of Dublin Attachment 1 ~ ~r ~~ METHODOLOGY USED FOR FISCAL YEAR 2009-2010 GARBAGE RATE ADJUSTMENT IN ACCORDANCE WITH AGREEMENT BETWEEN CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES Report Submitted To: City Council June 23, 2009 Prepared By: Roger Bradley, Administrative Analyst How Adiustment Factors Are Applied to Elements That Comprise Total Compensation The Agreement with AVI, as structured with the Company, initially provides a lump sum figure to provide all services in the Agreement. The initial rates were established to generate the annual revenue based on the initial level of customers. As new customers are added, the Company also receives revenue for those services. In accordance with section 5.14 of the Agreement, the Company retains any compensation in excess of what is calculated. If actual compensation is less than calculated, the Company is not entitled to any additional revenues. Annually there is a process established where a revised total compensation figure is developed. This calculation takes into consideration changes in the number of accounts serviced as well as adjustments to four elements. The Agreement divides compensation provided to AVI into the following five Elements: 1. Collection Compensation Element 2. Commercial Recycling Element 3. Disposal Compensation Element 4. Container Compensation Element 5. Fee Compensation Element 1. Methodology for Adjusting Rates to Reflect Changes In Collection Costs The Agreement with AVI contains a very detailed methodology for incorporating economic changes into the annual rate adjustments. Specifically, two calculations are made as part of a larger formula. The first is the Refuse Rate Adjustment (RRI) and the second an Annual Growth (AG) factor. On July 1, 2009, the agreement provides for an annual adjustment to Collection Compensation. The Agreement also details the time period to be used in making the annual adjustments. Steps Required to Calculate the RRI Factor The RRI factor cannot exceed 5%., and it is calculated based on the weighted percentage change in specific indices multiplied by the costs associated with key company expenses. The following table provides a summary description of how these factors are interrelated: STEP 1: INDICES USED IN RRI CALCULATION Operating Cost Category Index Used (To Produce A Weighted % Index Change @ Ad' ustment) 12/31/2008 LABOR Waste Collection-Average Hourly Earnings ° 2 32 /o (ceu60566210008) . VEHICLE REPLACEMENT Transportation Equipment-Truck & Bus Bodies Sold Separately 3.12% (wpu141301) VEHICLE MAINTENANCE Machinery & Equipment-Parts, Attachments and Accessories 22.20% ( u11440378) ALL OTHER Machinery & Equipment-Parts, Attachments and Accessories 22.20% (wpu11440378) Attachment 2 ~ ~. ~~ METHODOLOGY USED FOR FISCAL YEAR 2009-2010 GARBAGE RATE ADJUSTMEN IN ACCORDANCE WITH AGREEMENT BETWEEN CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES Report Submitted To: City Council June 23, 2009 Prepared By: Roger Bradley, Administrative Analyst The Company provides the City with their expenditures in each of these areas over Calendar Year 2008. These costs are AVI expenses and exclude disposal costs or fees paid to the City. The total costs for the year are used to determine the weighting to be applied for each of the indices. The following table shows the actual weighting used in the 2009/10 calculation. STEP 2: RRI WEIGHTING FACTOR BASED ON RELATIONSHIP TO TOTAL COSTS Operating Cost Category AVI $ reported % Total Expenses (Wei htin Factor) LABOR $ 1,282,772 25.76% VEHICLE REPLACEMENT 381,728 7.67% VEHICLE MAINTENANCE 967,781 19.43% ALL OTHER 2,347,651 47.14% TOTAL 4,979,932 As mentioned earlier, these factors are applied on a weighted basis. The index factor for each cost category is multiplied by the weighting factor. The result will produce the RRI, which per the agreement cannot exceed 5%. Had there not been a cap, the RRI would have been 15.62%. The following table shows the 2009/10 results: STEP 3: RRI CALCULATION (CANNOT EXCEED 5%) [Index Change multiplied By Weighting Factor] O eratin Cost Cate o RRI LABOR 0.60% VEHICLE REPLACEMENT 0.24% VEHICLE MAINTENANCE 4.31 ALL OTHER 10.47% TOTAL *5.00% *Adjusted to 5.00% as, per the Agreement, cannot exceed 5.00% Steps Required to Calculate the Annual Growth (AG) Factor The Annual Growth factor uses a formula that compares revenue at two points in time. The "Beginning Calculated Revenue" equals the current rates multiplied by the census of January 2008. This is compared to the "Ending Calculated Revenue". The Ending Calculated Revenue is equal to the current rates multiplied by the December 2008 census. The adjustment reflects increases in the number of billed units served. The methodology is relatively straight forward. The Agreement with AVI included an Exhibit which lists various service events. For example, it included the number of single family basic service units; number of commercial bins by size; and frequency of service; etc. These are then multiplied by the appropriate monthly rate. Residential service is a bundled rate for recycling and garbage and, therefore, recycling is not included in the calculation. Moreover, each single family unit is calculated at the Basic Rate regardless of whether they may have multiple 2 Attachment 2 `1 (~' H D L Y ED F R FI AL YEAR 2009-2010 GARBAGE RATE ADJUSTMENT MET O O OG US O SC IN ACCORDANCE WITH AGREEMENT BETWEEN CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES Report Submitted To: City Council June 23, 2009 Prepared By: Roger Bradley, Administrative Analyst recycling or green waste bins. Similarly, the commercial bin service is a bundled rate and only the billed garbage service for which there is a rate established is counted in this formula. For the 2009/2010 adjustment, the Agreement provides for the calculation to be done based on the actual Collection census data as of January 2008 and as of December 2008. The rates used for this comparison are the rates in effect on July 1, 2008. The 2009/2010 calculation showed that the "Beginning Calculated Revenue" based on the January 2008 census was $619,366 and the "Ending Calculated Revenue" based on the December 2008 census was $615,585. This results in a 2009/2010 Annual Growth Factor of -0.61 %. [$615,585 - 619,366 = - $3,781; -3,781/619,366 = -.0061] Application of RRI and AG to Collection Compensation Element The 2008/2009 Collection Compensation Element was $5,124,727. In accordance with the Agreement, this amount is first adjusted by the Annual AG Factor [5,124,727 (1-.0061) _ $5,093,466] and then that total is escalated by the RRI factor. [$5,093,466 * 1.05 = $5,348,139] This amount then flows into the projected total compensation shown in Section 6 of this report. 2. Methodology for Adiustin~ Commercial Recycling Compensation The City has agreed to provide a compensation amount to AVI for the City's Commercial Recycling Program. This amount is escalated each year by the RRI factor, which is calculated as described above and the growth in commercial recycling tonnage. The commercial recycling growth is calculated based on the total tonnage at the end of each calendar year over the total tonnage for the previous. For Calendar Year 2008, the total recycling tons collected was 2,097.73. In 2007, AVI collected 1,831.62. This results in an increase of 14.53% (2,097.73 - 1,831.62 = 266.11; 266.11 / 1,831.62 = .145287). This percentage increase is added to the RRI factor with the combination of the factors used to inflate the previous year's Commercial Recycling Program compensation amount (0.145287 +0.05 = 0.195287; $205,130 * 0.195287 = $40,059; $205,130 + $40,059 = $245,189). This amount then flows into the projected total compensation shown in Section 6 of this report. AVI Commercial Rec clin Compensation for FY 2009-2010 Commercial RRI Recycling Compensation Element Year Recycling Factor AVI C Effective Tons Growth omp Date 2005 1418 Base Year $150,000 2006 1454 2.55% 3.60% $159,225 2007 1832 25.94% 2.89% $205,130 7/1 /2008 2008 2097 14.53% 5.00% $245,189 7/1 /2009 Attachment 2 ~, i ..~'" £¢'~ ~~ METHODOLOGY USED FOR FISCAL YEAR 2009-2010 GARBAGE RATE ADJUSTMENT IN ACCORDANCE WITH AGREEMENT BETWEEN CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES Report Submitted To: City Council June 23, 2009 Prepared By: Roger Bradley, Administrative Analyst 3. Methodology for Adiusting Rates to Reflect Changes In Landfill /Disposal Costs Landfill disposal costs are established under a separate agreement between the City of Dublin and Waste Management Inc. AVI is required to use the disposal facility designated by the City. AVI makes the payments for disposal costs and pays the price negotiated by the City under the separate agreement with Waste Management. Since these are expenses incurred by AVI, these costs must also be considered in setting the rates. The landfill component has the following two factors that impact the rates: 1) Tip Fee Factor, and 2) Annual Tonnage Factor. Approved Tip Fee(ATF) Factor In 2009/2010, the cost per ton for landfill fees will increase by $1.08 per ton. The increase comes from two separate categories: increases in governmental regulatory fees and increases as provided in the Disposal Agreement with Waste Management. The increase in regulatory fees is 83 cents per ton (25 cent increase in Measure D and 7 cent increase in Open Space Fees). The increase as provided in the disposal agreement with Waste Management is 25 cents per ton. Therefore, the total disposal cost for 2009/2010 will be $29.89 per ton. Of this amount, $16.35 is related to regulatory fees and $13.54 reflects the portion paid to Waste Management for landfill services. The portion paid to Waste Management can increase only as provided in a Disposal Agreement between the City and Waste Management. The regulatory fees are levied by other agencies such as StopWaste.Org; County Local Enforcement Authority; California Integrated Waste Management Board; Household Hazardous Waste Fees; County Business License; etc. This results in an ATF Factor of 2.88%. [2008 Rate = $28.81/ton and 2009 Rate = $29.89/ton. $29.89 - 28.81 = 1.08; 1.08 / 28.81 = 0.0375] Historical Comparison of ATF Factor Fees Assessed on a Per Ton Basis ----- Disposal Fee Element (Gov Fees + Disposal Agreement Fees} --- Government Fee Element (Fees Assessed by Governmental Agencies) Y Be ~ Disposal Gov Fee Element Element otal CIWMB AB 1220 Law Enforcement A enc Co Bus License Measure D ACWMA Facilities ACWMA HHW Co Planning Fee Co. Open S ace Total Gov Fees 7/112005 $12.76 $14.9D $2286 $1.40 $0.22 $0.95 $7.19 $1.50 $2.15 $0.08 $1.41 $14.90 711t200S $12.76 $15.02 $2; .; 8 $1.40 $0.22 $0.95 $7.28 $1.50 $2.15 $0.08 $1.44 $15.02 71112007 $13.02 $15.22 $28.24 $1.40 $0.22 $0.95 $7.43 $1.50 $2.15 $0.08 $1.49 $15.22 7/1!2008 $13.29. ...$15.52 $28.81 $1.40 $0.22 $0.95 $7.67 $1.50 $2.15 $0.08 $1.55 $15.52 7/1/2009 $13.54 $16.35 $29.89 $1.40 $0.22 $0.95 $7.92 $2.00 $2.15 $0.08 $1.62 $16.35 Annual Tonnage (AT) Factor The tonnage increase for the 2009/10 adjustment is based on disposal reports for the period January 1, 2008 -December 31, 2008 and is the summation of the monthly tonnages over this period. This amount is then compared against the previous year's disposal tonnage. The total disposal in 2008 was 25,598 tons, and in 2007, it was 25,929 tons. This results in an AT Factor of -1.28%. [25,598 - 25,929 = -331; -331 / 25,929 = - 0.0128] 4 Attachment 2 METHODOLOGY USED FOR FISCAL YEAR 2009-2010 GARBAGE RATE ADJUSTMENT-~ IN ACCORDANCE WITH AGREEMENT BETWEEN CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES Report Submitted To: City Council June 23, 2009 Prepared By: Roger Bradley, Administrative Analyst Application of ATF and AT Factors to Disposal Compensation Element The Landfill Compensation Element was $747,006 in 2008. In accordance with the Agreement, this amount is first adjusted by the Annual AT Factor [(747,006 * -0.0128) + 747,006 = $737,444] and then that total is escalated by the ATF factor. [$737,444 * 1.0375 = $765,098] This amount then flows into the projected total compensation shown in Section 6 of this report. 4. Methodology Addressing Container Compensation Element This element represents the amortized cost of carts and bins over the life of the agreement. The allowed amount is modified by the AG factor. As noted above, this factor was calculated at -0.61 % for the 2008/09 adjustment. For the 2008/09 adjustment, the amount designated for the Container Element was $196,178. Adjusting this amount by the AG Factor results in $194,981 being the amount to be recovered from rates in 2009/10. 5. Methodology Addressing Fee Compensation Element As part of the Agreement with the City of Dublin, AVI is required to remit franchise taxes and certain fees to the City of Dublin based on a percentage of its revenue. Therefore, as the company rates go up the Fee Element must also be adjusted in order to recognize the fees to be paid on the new revenue. The Fee Compensation Element shall equal: 1. (Collection + Commercial Recycling Element + Disposal + Container Elements) _ "base compensation" 2. "base compensation" is divided by (one (1) minus the "Current Fee Percentage") [Where the "Current Fee Percentage" = 15.6%] 3. subtract "base compensation" from the obtained value For 2009/10, the Fee Compensation Element Calculation is as follows: (5,348,139 + 245,189 + 765,098 + 194,981) _ $6,553,407 (base compensation) $6,553,407 / (1- 15.6%) _ $5,531,75 / (84.4%) $6,553,407 / 84.4% _ $7,764,700 $7,764,700 - $6,553,407 = $1,211,293 The adjusted total compensation for the Fee Element is shown in Section 6 below. 6,_City Process of Developing Rates Projected to Meet Total Compensation As discussed above, certain adjustment factors are applied to each area. The starting point is the base compensation from the previous agreement year as required under the Agreement. The adjustment methodology is shown in the table below. As the table shows, the Fiscal Year 2009-2010 rate adjustment process results in the need to establish rates at a level expected to generate $7,764,700 in revenue. This amount is $332,187 more than the allowed compensation calculated when the rates were established on July 1, 2008. Attachment 2 < '1 METHODOLOGY USED FOR FISCAL YEAR 2009-2010 GARBAGE RATE ADJUSTMENT; 11 IN ACCORDANCE WITH AGREEMENT BETWEEN CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES Report Submitted To: City Council June 23, 2009 Prepared By: Roger Bradley, Administrative Analyst Prior to establishing the compensation that will be generated from the rates, an adjustment is made for grant revenues that reduce the Company's operating cost. The amount of revenue required from rates is partially offset by one grant. A $350,000 grant was obtained at the beginning of the agreement to reduce the cost of implementing a natural gas truck fleet. The total grant is amortized over the 7 year life of the Agreement and, therefore, $50,000 is credited against required revenue in 2009/10. The final step in developing the rates is to test the total annual expected revenue to the Company, when the rates are increased by different amounts. It is necessary for the adjustment to be at a level so that the total annual projected compensation to the Company will equal $7,764,700. The calculation for Fiscal Year 2009-2010 is performed using the census figures as of December 2008. Based on the December 31, 2008 census of customers serviced by AVI, Staff has determined that a 5.09% rate increase to all categories will generate the required revenue. It is not possible to exactly match the targeted annual revenue given the various subscription levels and fees. The test calculation shows that when the grant funds of $50,000 are added to the new rates that the total projected compensation is $7,765,190. An additional cost of $2,913 was included in the rate compensation model to offset costs in the timing of landfill fee increases, which have been paid by AVI and were not included in the 2008/09 rate model. 6 Attachment 2 METHODOLOGY USED FOR FISCAL YEAR 2009-2010 GARBAGE RATE ADJUSTMENT IN ACCORDANCE WITH AGREEMENT BETWEEN CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES Report Submitted To: City Council June 23, 2009 Prepared By: Roger Bradley, Administrative Analyst Historical Comparison of Compensation Elements 2005/2006 - 2008/2009 Compensation Element 2005/2006 Com ensation 2006/2007 Com ensation Absolute Chan a Percent Chan a 2007/2008 Com ensation Absolute Chan e , Percent Chan a 2008!2009 Com ensation Absolute Chan a Percent Chan a 2009/2010 Ad'usted Com Absolute Chan a Percent Chan e Collection $ 4,176,900 $ 4,612,722 $435,822 10.43% $ 4,839,470 $ 226,748 4.92% $ 5,124,727 $ 285,257 5.89% $ 5,348,139 $ 223,412 4.36% Commercial Rec clin $0 $0 -- -- $0 - -- $ 205,130 $ 205,130 -- $ 245,189 $ 40,059 19.53% Dis osal $ 747,899 $ 828,930 $81,031 10.83% $ 786,736 $(42,194) -5.09% $ 747,006 $(39,730) 5.05% $ 765,098 $18,092- 2.42% Container $ 177,000 $ 188,222 $11,222 6.34% $ 190,612 $ 2,390 1.27% $196,178 $ 5,566 2.92% $ 194,981 $(1,197) -0.61% Fee $ 942,987 $1,040,593 $97,606 10.35% $ 1,075,146 $ 34,553 3.32% $1,159,472 $ 84,326 7.84% $1,211,293 $ 51,821 4.47% TOTAL $ 6,044,786 $ 6,670,467 $625,681 10.35°/a $ 6,891,964 ~ 221,497 3.32% $ 7,432,513 $ 540,549 7.84% $7,764,700 $ 332,187 4.47% ~'~.; 7 Attachment 2 ~ ~~. Selected Service Levels Re resentin Most Common Subscri tions ,-y4 P g P COMPARISON OF SELECTED RATES Current (2008/09) vs Proposed (2009/10) Proposed Increase over Current Proposed 2008/2009 Residential -Monthly Rates Rate 2009/2010 $ Minimum Residential (32) Gallon $13.56 $14.25 $0.69 5.09% 64 Gallon Residential $24.91 $26.17 $1.26 5.06% Sample rate categories represent 96% of residential customers Commercial -Monthly Rates 1 Yard - 1 time / wk $60.46 $63.53 $3.07 5.08% 2 Yard - 1 time / wk $120.92 $127.06 $6.14 5.08% 3 Yard - 1 time / wk $181.38 $190.59 $9.21 5.08% 3 Yard - 2 times / wk $377.81 $396.99 $19.18 5.08% 4 Yard - 1 Time / wk $241.84 $254.12 $12.28 5.08% 4 Yards - 2 times / wk $498.73 $524.05 $25.32 5.08% Sample rate categories represent 71 % of commercial customers Droa Box -Rates Per Service 20 Yard Loose $340.40 $357.60 $17.20 5.05% 30 Yard Loose $510.60 $536.40 $25.80 5.05% 40 Yard Loose $680.80 $715.20 $34.40 5.05% Represents 86% of 2005 non-compacted Drop Box Subscriptions 30 Yard Compacted $1,020.30 $1,071.90 $51.60 5.06% Represents 39% of the 2005 compacted Drop Box Subscriptions Handy Hauler Available To Residents $79.12 $83.13 $4.01 5.07% ~~ Attachment 3 ATTACHMENT 3 -RATE COMPARISON 2009 Garbage Rate Comparison Survey (Prepared June 2, 2009) Comparison With Proposed Rates Proposed Dublin % Proposed Current % Increase Residential Livermore Pleasanton San Ramon Average Basic Rate From Avg Rate over Prior FY 1 Can Residential (32-35 Gallon) $ 16.21 $ 29.13 $ 23.05 $ 22.80 $ 14.25 -37% $13.56 5.1% 1 Can Residential (64-70 Gallon) $ 35.63 $ 34.57 $ 40.23 $ 36.81 $ 26.17 -29% $24.91 5.1% Dublin Customers Covered By Sample Rate Categories: 96% Residential Notes: Dublin: Basic rate includes 32-gallon garbage can (weekly pick-up);Weekly 64-gallon organics can; Weekly 64-gallon curbside recycling can; lager size and/or additional organic and recycling carts available upon request; compost give-back and 3 on-call bulky waste clean-ups per year including items such as electronic waste, household batteries, tires, white and brown goods. Livermore: Basic rate includes 35-gallon garbage can (weekly pick-up); Weekly 96-gallon organics can; Weekly 64-gallon curbside recycling can; and 3 on-call clean-ups per year. San Ramon: Basic rate includes 35-gallon garbage can (weekly pick-up); Weekly 96-gallon green waste can supplied by Company; Weekly 64-gallon curbside recycling can, and 3 special clean-ups per year. Pleasanton- effective October 2009: 35 Gallon Service includes 35 gallon trash cart, 64 gallon green/food scrap cart and 96 gallon recycling cart. 96 Gallon service inlcudes a 96 gallon trash cart, 64 gallon green/food scrap cart and a 96 gallon recycling cart. Both services have weekly pick up. Residents still have the option to drop off recyclables at the transfer station to recieve credit on their PGS invoice proivdeded that the recyclabes weigh 75 Ibs or more. no special curbside clean-ups . 3 City Proposed % Proposed Current % Increase Commercial Livermore Pleasanton San Ramon Average Dublin From Avg Rate over Prior FY 1 Yard - 1 time / wk $ 76.14 $122.73 $ 111.70 $ 103.52 $ 63.53 -39% $ 60.46 5.1% 2 Yard - 1 time / wk $ 152.28 $245.30 $ 207.38 $ 201.65 $ 127.06 -37% $ 120.92 5.1% 3 Yard - 1 time / wk $ 228.42 $350.48 $ 287.00 $ 288.63 $ 190.59 -34% $ 181.38 5.1% 3 Yard - 2 times / wk $ 475.83 $648.17 $ 574.02 $ 566.01 $ 396.99 -30% $ 377.81 5.1 4 Yard - 1 Time /wk $ 304.56 $456.30 $ 350.60 $ 370.49 $ 254.12 -31% $ 241.84 5.1% 4 Yards - 2 times / wk $ 634.44 $853.22 $ 701.20 $ 729.62 $ 524.05 -28% $ 498.73 5.1 % Dublin Customers Covered By Sample Rate Categoriesr 71% Dublin and Livermore rates include free commercial recycling Drog Box 20 Yard Loose $ 369.60 $458.00 $ 546.97 $ 458.19 $ 357.60 -22% $ 340.40 5.1% 30 Yard Loose $ 554.40 $687.00 $ 571.56 $ 604.32 $ 536.40 -11% $ 510.60 5.1% 40 Yard Loose $ 739.20 $916.00 $ 596.14 $ 750.45 $ 715.20 -5% $ 680.80 5.1% 30 Yard Compacted $ 1,663.50 $1,374.00 $ 725.21 $ 1,254.24 $ 1,071.90 -15% $ 1,020.30 5.1% 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 z '< _ l ATTACHMENT 4 1 ~ ''~ V) ~ ~~. RESOLUTION NO. - 09 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN APPROVING AMENDMENT N0.3 TO THE AGREEMENT WITH AMADOR VALLEY INDUSTRIES FOR SOLID WASTE COLLECTION SERVICES WHEREAS, the City of Dublin and Amador Valley Industries, LLC (AVI) are parties to a Collection Service Agreement between the City of Dublin and Amador Valley Industries, LLC (the Agreement), dated January 12, 2005; and WHEREAS, the Agreement with AVI allows for an annual compensation adjustment in accordance with specified formulas; and WHEREAS, the first two pages of Exhibit 2 to the Agreement, located on pages 78 and 79 of the Agreement, identify the indices to be used in calculating the RRI Factor, defined in Section 5.05.1.1 of the Agreement; and and WHEREAS, certain of those indices are no longer produced by the Bureau of Labor Statistics; WHEREAS, the Bureau of Labor Statistics has comparable indices to those previously used in calculating the RRI Factor; and WHEREAS, it is necessary to amend the Agreement to incorporate appropriate indices for calculating the RKI Factor, allowing for the continuation of the annual rate adjustment as required by the Collection Services Agreement. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin hereby approves the Third Amendment to the Agreement with Amador Valley Industries, LLC (attached hereto as Exhibit A). BE IT FURTHER RESOLVED that the City Council of the City of Dublin hereby authorizes the City Manager to execute the Third Amendment to the Agreement. PASSED, APPROVED AND ADOPTED this 23rd day of June, 2009. AYES: NOES: ABSENT: ABSTAIN: ATTACHMENT 5 Mayor ATTEST: City Clerk 1245257.1 ATTACHMENT 5 EXHIBIT A ~ ~ -'~ r~ i ~~ THIRD AMENDMENT TO THE COLLECTION SERVICE AGREEMENT BETWEEN THE CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES, LLC This Third Amendment to Collection Service Agreement, dated as of 2009 (the "Amendment") modifies and amends that certain "Collection Service Agreement," dated January 12, 2005, as previously amended (the "Agreement"), between the City of Dublin ("CITY") and Amador Valley Industries, LLC ("CONTRACTOR"). Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Agreement. Recitals WHEREAS, the Agreement sets forth the respective rights and obligations of the parties with respect to the Collection of Solid Waste and Organic Materials and grants CONTRACTOR an exclusive right to provide Collection Services within the Service Area; WHEREAS, on June 20, 2006, the parties executed a First Amendment to the Agreement in order to modify certain provisions in Exhibit 2 of the Agreement relating to the Compensation Adjustment Model; and WHEREAS, on June 17, 2008, the parties executed a Second Amendment to the Agreement in order to provide for: compensation to CONTRACTOR for the collection of Recyclable Materials produced by Commercial Service Units; to modify CONTRACTOR'S obligation to provide Large Item Collection Service to City Service Units; to require CONTRACTOR to perform a minimum of two waste audits per day; to require CONTRACTOR to increase its Commercial and MFD outreach and education programs and to perform at least twelve campaigns each Agreement Year and to require CONTRACTOR to submit an annual diversion plan for approval by the City each Agreement Year; and WHEREAS, the parties desire to further amend the Agreement to modify the indices used to calculate the RRI Factor as listed in Exhibit 2, pages 78 and 79, of the Collection Services Agreement. NOW, THEREFORE, for good and valuable consideration, the sufficiency of which is hereby acknowledged, CITY and CONTRACTOR hereby agree to amend the Agreement as follows: Section 1. The first two pages of Exhibit 2, on pages 78 through 79, of the Agreement are hereby deleted and replaced with new pages 78 through 79 to read as follows: EXHIBIT A Collection Service Agreement Exhibit 2 City of Dublin, CA Compensation Adjustment RRI Financial Statement Format Operating Costs Labor: Series ID: ceu60566210008 Waste Collection -Average Hourly Earnings List all administrative, officer, operation and maintenance salary accounts. List payroll tax accounts directly related to the above salary accounts. 4 ~'~ ~ P r Vehicle Replacement: Series ID: wpu141301 Transportation Equipment -Truck & Bus Bodies Sold Separately List all Collection and Collection related vehicle depreciation accounts. List all vehicle lease or rental accounts related to Collection or Collection related vehicles Vehicle Maintenance: Series ID: wpu11440378 Machinery & Equipment-Parts, Attachments and Accessories List all Collection and Collection related vehicle parts accounts. All Other: Series ID: wpu11440378 Machinery & Equipment-Parts, Attachments and Accessories List all other expense accounts related to the services provided under this Agreement. This category includes all insurance including general liability, fire, truck damage, extended coverage and employee group medical and life; rent on property, truck licenses and permits; real and personal property taxes; telephone and other utilities; employee uniforms; safety equipment; general yard repairs and maintenance; office supplies; postage; trade association dues and subscriptions; advertising; employee retirement or profit sharing contributions; and miscellaneous other expenses. Page 78 City of Dublin ~- ~~. EXHIBIT A ~~ '~`~ Collection Service Agreement Exhibit 2 City of Dublin, CA Com ensation Ad~ustment Model The annual compensation adjustment is calculated in accordance with the procedures set forth in Article 5 of the Collection Service Agreement. This exhibit is provided as an example of how the individual calculations are used to develo the overall com ensation Step Collection Compensation Element 1 1a Calculate RRI Factor Use model to Input current year indices Annual Avera a Calendar Year 12/31 Indices 2004 2005 2006 2007 Series ID: ceu60566210008 Waste Collection -Average Hourly Eaznings 12.97 14.48 13.64 15.33 Series ID: wpu141301 Transportation Equipment -Truck & Bus Bodies Sold Se azatel 169.7 171.40 173.60 174.60 Series ID: wpul 1440378 Machinery & Equipment-Parts, Attachments and Accessories 129.5 131.30 132.40 135.10 Series ID: wpu11440378 Machinery & Equipment-Parts, Attachments and Accessories 180.2 189.90 193.00 196.40 1 b Model calculates % change in current and prior year indices Delta % Previous Year to Year lnnual Avera a Calendar Year 12/31 2004 2005 2006 2007 Series ID: ceu60566210008 Waste Collection -Average Hourly Earnings 11.64% 5.17% 5.87% Series ID: wpu141301 Transportation Equipment -Truck & Bus Bodies Sold Se azatel 1.00% 2.30% 1.87% Series ID: wpu11440378 Machinery &Equipment-Parts, Attachments and Accessories 1.39% 2.24% 2.89% Series ID: wpu11440378 Machinery & Equipment-Parts, Attachments and Accessories 4.04% 5.33% 2.57% 1 c Use "RRI Input' Module to input CONTRACTOR financial data Contractor Financial llata Annual Avera a Calendar Year 12/31 ~nn~ 2005 2006 2007 Labor $ 1,375,000 $1,443,750 $1,515,938 Vehicle Replacement $ 248,000 $ 260,400 $ 273,420 Vehicle Maintenance $ 246,000 $ 258,300 $ 271,215 All Other $ 2,779,000 $2,917,950 $3,063,848 $ 4,648,000 $4,880,400 $5,124,420 1d Model calculates wei htin factor for each Cate o Contractor Wei htin % Annual Avera a Calendar Year 12/31 2004 2005 2006 2007 Labor 29.58% 29.58% 29.58% Vehicle Replacement 5.34% 5.34% 5.34% Vehicle Maintenance 5.29% 5.29% 5.29% All Other 59.79% 59.79% 59.79% Total 100.00% 100.00% 100.00% 1e Model multiplies index change (1 b) by weighting factor (1d) RRI % Annual Avera a Calendar Year 12/31 2004 2005 2006 2007 Series ID: ceu60566210008 Waste Collection -Average Hourly Earnings 3.44% 1.53% 1.74% Series ID: wpu141301 Transportation Equipment -Truck & Bus Bodies Sold Sepazately 0.05% 0.12% 0.10% Series ID: wpu11440378 Machinery & Equipment-Parts, Attachments and Accessories 0.07% 0.12% 0.15% Series ID: wpu11440378 Machinery & Equipment-Parts, Attachments and Accessories 1.81 % 2.39% 1.15% RRI Factor 5.38% 4.16% 3.14% Allowed RRI Factor 5.00% 4.16% 3.14% Page 79 EXHIBIT A 1 Section 2. In the event of a conflict between the Agreement and this Amendment, this Amendment will control. Except to the extent inconsistent with this Amendment, the Parties ratify and confirm all of the terms and conditions of the Agreement. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the date and year first above written. CITY OF DUBLIN Dated: Attest: By: Caroline Soto City Clerk APPROVED AS TO FORM: By: John D. Bakker City Attorney Dated: By: Joni L. Pattillo City Manager AMADOR VALLEY INDUSTRIES, LLC, a California Limited Liability Company By: Its: 1245256.1 °~ ~,. ., .1 RESOLUTION NO. - 09 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 executed a Collection Service Agreement with Amador Valley Industries (AVI) on January 12, 2005; and WHEREAS, the Agreement requires the City Council to adopt a rate schedule, which is estimated to produce a specified revenue amount as identified in the Agreement; and WHEREAS, the City Council adopted the initial rate schedule with Resolution 68-OS at a noticed public hearing on May 3, 2005 and the Agreement provides that the City Council is responsible for establishing all rates; and WHEREAS, the Agreement with AVI provides for an adjustment to the rates each July lst in accordance with specified formulas; and WHEREAS, the City has calculated the required rate adjustment necessary to generate the agreed to compensation and applied a 5.09% adjustment to all solid-waste collection rates; and WHEREAS, on June 23, 2009, the City Council conducted a noticed public hearing prior to the adoption of the new rate schedule. 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, 2009, 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 23rd day of June, 2009. AYES: NOES: ABSENT: ABSTAIN: ATTEST: Mayor City Clerk Attachment 6 •% x~ ~r ' R .., 0 2009/10 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. Amador Valley Industries, Inc. is the authorized garbage collection and disposal firm operating within the City. The agreement between the City of Dublin and Amador Valley Industries, Inc. 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, 2009. Basis of Fees The City,has negotiated amulti-year agreement with Amador Valley Industries, Inc. The Company may request a change in rates based upon a formula which includes: changes in the Refuse Rate Index; Increased Regulatory Fees; and changes in the total tons delivered to the Landfill. The additional costs of each of these components has been allocated to the three classes of service: Residential; Commercial Bin Service; and Drop Box/Compactor. 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 32 gallons of garbage capacity, including once per week collection and disposal; Weekly Curbside Residential Recycling; and Weekly Curbside Green Waste Recycling Large Item Collection Service; and access to an Annual HHW drop-off event. All containers are provided by the Company. Minimum Monthly Rate : $ 14.25 (Rate includes $0.25 retained by City for preparing tax roll /collection.) Residents may select a larger garbage container for an additional fee which is shown below: 64 Gallon Garbage Container: Minimum Cost Plus $11.92 per month (Total . $ 26.17 per month) 96 Gallon Garbage Container: Minimum Cost Plus $23.84 per month (Total = $ 38.09 per month) Residents may request a second garbage container which will be charged at the same rate as a first container based on the Second Container: size requested. Additional Large Item Collection: Residents may request additional large item collection services for a fee of : $ 9.36 per Cubic Yard COMMERCIAL AND MULTI-FAMILY BIN SERVICES (FRONT-END-LOADERI 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. 32 Gallon Container: $14.85 64 Gallon Container: $27.27 96 Gallon Container: $39.67 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. Rate Resolution Exhibit A .~ t k ~~ Size # Times Size # Times # Yards Per Wk Base Monthly Rate # Yards Per Wk Base Monthly Rate 1 1 $63.53 4 1 $254.12 1 2 $142.87 4 2 $524.05 1 3 $222.21 4 3 $793.98 1 4 $301.55 4 4 $1,063.91 1 5 $380.89 4 5 $1,333.84 1 6 $460.23 4 6 $1,603.77 2 1 $127.06 6 1 $381.18 2 2 $269.93 6 2 $778.17 2 3 $412.80 6 3 $1,175.16 2 4 $555.67 6 4 $1,572.15 2 5 $698.54 6 5 $1,969.14 2 6 $841.41 6 6 $2,366.13 3 1 $190.59 7 1 $444.71 3 2 $396.99 7 2 $905.23 3 3 $603.39 7 3 $1,365.75 3 4 $809.79 7 4 $1,826.27 3 5 $1,016.19 7 5 $2,286.79 3 6 $1,222.59 7 6 $2,747.31 Organic material is cha rged at 75% of the Commercial Service rate. OTHER COMMERCIAL SERVICES: Rates for additional requested services. Container Push: $ 5.78 Lock & Key: $ 3.47 Excess Waste (Cu. Yd) : $ 18.97 per Cubic Yard Excess Cart Exchange : $ 5.78 Excess Bin Exchange: $ 23.12 Excess Bin Cleaning: $ 28.89 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: Additional Bin Rental Per Week: $20.91 Per Week Excess Per Yard If Filled Above Water Level $83.13 Cost For Additional Dump: $60.27 Per Pick-up $18.97 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 (Excess is charged the same rate). Additional Miscellaneous charges may also apply. Rate Per Cubic Yard: Non-Compacted: $17.88 Compacted: $35.73 Organic material is charged at 75% of the non-compacted or compacted rate as appropriate. MISCELLANEOUS DROP BOX CHARGES Relocation of Drop Box $53.46 Per Request Weekly Drop Box Container Rental -After 1st Week $20.91 Per Week Cancel Auto Pick-up Without Notice $67.35 Per Event Handy Hauler Extra Week Rental $14.95 Per Week Standby Time $87.78 Per Hour Rate Resolution Exhibit A r... C%~' i ' , RESOLUTION NO. - 09 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN APPROVING AND ESTABLISHING THE COLLECTION OF MINIMUM RESIDENTIAL GARBAGE AND RECYCLING SERVICE FEES FOR FISCAL YEAR 2009-2010 WHEREAS, the City of Dublin is mandated by the State of California, under AB 939, to reduce the amount of solid waste going into the landfill; and WHEREAS, through the Mandatory Garbage Ordinance and other means, the City of Dublin is taking a proactive stance to meet the State Mandated Goals; and WHEREAS, the goal of the Mandatory Garbage Ordinance is to protect the health and welfare of the community, to provide recycling services to all residential property owners, and to equally share the costs of these programs by mandating that every residence contributes towards the cost of the service made available; and WHEREAS, minimum service includes service described in the current Agreement with the franchised waste hauler, Amador Valley Industries (AVI); and WHEREAS, in accordance with California Constitution Article XIII C (Proposition 218) Section 6 (2), the City has provided written notice to all affected property owners March 18, 2005 prior to adopting the 2005/2006 rate structure which included a provision for future increases based on changes in specified indices as outlined in the agreement with AVI; and 2009. WHEREAS, the City Council has considered this action as part of a noticed public hearing on June 23, NOW, THEREFORE, BE IT RESOLVED that, the City Council of the City of Dublin does hereby approve and establish the collection of minimum residential services fees by the City on the property tax bill as shown in Exhibit A, which is attached hereto and hereby incorporated by reference. BE IT FURTHER RESOLVED that City Staff are hereby authorized to undertake all administrative tasks to implement the assessments, including, but not limited to an agreement with Alameda County for collection, which may provide payment to Alameda County of its reasonable costs of collection not to exceed 1.7% of the total amount levied. PASSED, APPROVED AND ADOPTED this 23`d day of June, 2009. AYES: NOES: ABSENT: ABSTAIN: Mayor ATTEST: City Clerk Attachment 7 City of Dublin `'' ~~~ I ' ~~I RESIDENTIAL MINIMUM GARBAGE /RECYCLING SERVICES (Collected With Residential Property Tax Bills) Basis of Fees The City has negotiated amulti-year agreement with Amador Valley Industries (AVI) requiring a rate adjustment to the residential minimum garbage/recycling services collected with the property tax bills. The current annual fee of $162.72 per year will increase $8.28 for a total of $171.00 for 2009-2010. The annual assessment equates to a monthly increase of $0.69, from $13.56 to $14.25. The Agreement with the Company provides for annual adjustments to the rates based upon annual changes in five separate indices maintained by the Bureau of Labor Statistics (Refuse Rate Index), plus pass-through disposal costs. The five indices account for cost changes in the following categories: labor; fuel and oil; vehicle replacement; vehicle maintenance; and all other costs. In order to determine the fee, the City estimates the total revenue required to pay the Garbage Company for Minimum Service to all residential units that are eligible to use the service, according to the terms of the agreement with AVL The specific factors considered in this calculation include the following components: the residential rate for Minimum Service; estimated number of housing units affected by the fee; costs associated with the collection of the fee as part of the Property Tax Bill; estimated delinquencies; estimated revenues from late payments and interest earnings; and funds available from collections in a prior year. Affected Parcels Chapter 5.32 of the Dublin Municipal Code requires the protection of the health, safety, and welfare of the community by requiring that all parcels obtain minimum weekly garbage service. Residential housing units are billed for the cost of Minimum Garbage Service, which is included with the annual property tax bill. This fee only applies to residential units which have individual garbage containers and are not serviced by central bins. This does include duplexes and other attached housing types, which receive individual service. Households subject to this fee, which only receive Minimum Service, will not be billed by the Garbage Company. Amador Valley industries will bill customers each quarter for additional services, if a household selects weekly garbage collection of a container larger than the 32 gallon container included in the Minimum Service Level. Services Provided By the Fee Minimum service includes weekly curbside collection of: a 32 gallon garbage container; up to two 96 gallon organic waste carts; up to two 96 gallon recycling carts; used oil and filters; an annual household hazardous waste drop off event; and three on-call bulky waste pick-ups per year. Amount of the Fee The annual amount of the assessment includes the cost of collection as well as the cost of services over the entire year. The City makes the payment to Amador Valley Industries based upon the current rate allowed for Minimum Residential Service. TYPE OF HOUSING UNIT ANNUAL FEE Each Single Family Residence $ 171.00 Each Condominium /Townhouse Unit $ 171.00 Each Duplex (2 Units) $ 342.00 Each Duplex (5 or More Units) $171.00 times the number of units EXHIBIT A