HomeMy WebLinkAbout7.1 AVI Collection Agmt Amend~~~~ OF Dp~~~
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19 ~;~'8z STAFF REPORT C I T Y C L E R~
~~c~~ll~ 1~ DUBLIN CITY COUNCIL File #^~ Q~ QD-0~
DATE: June 1, 2010 ~
TO: Honorable Mayor and City Councilmembers
FROM: Joni L. Pattillo, City Manager
SUBJECT: Fourth Amendment to the Collection Service Agreement between the City of
Dublin and Amador Valley Industries, LLC
Prepared By: Roger Bradley, SeniorAdministrative Analyst ~
EXECUTNE SUMMARY:
The City Council will consider approving an amendment to the Collection Service Agreement
between the City of Dublin and Amador Valley Industries. If approved, the Amendment would
extend the contract term with Amador Valley Industries for an additional eight years, create a
no-negative growth provision within the solid waste rate structure, update indices used to
increase solid waste rates, include commercial recycling bins as an item in the annual growth
factor, and adjust franchise and administrative fee rates.
FINANCIAL IMPACT:
The cost of the minimum required residential can (32 gallon) would increase by $3.74 per
month to $17.99 per month. When compared to the Tri-Valley cities of Livermore, Pleasanton,
and San Ramon, the $17.99 monthly fee is 25.60% below the Tri-Valley average monthly rate
of $24.18 and 6.74% below the Livermore monthly rate of $19.29, which is the closest rate to
the City of Dublin.
RECOMMENDATION:
Staff recommends that the City Council adopt the Resolution approving the Fourth Amendment
to the Agreement with Amador Valley Industries, LLC and authorize the City Manager to
execute the Amendment.
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Submi ed By Reviewed By Revi wed y
Sr. Adminis rative Analyst Administrative Services Director Assistant i anager
Page 1 of 5 0~~~ ~O. ~~_
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DESCRIPTION:
At the City Council meeting of June 23, 2009, Staff was directed to work with the City's refuse
hauler, Amador Valley Industries (AVI), to amend the Collection Service Agreement to augment
the annual rate adjustment methodology to adjust for losses experienced by AVI as a result of
recent economic conditions. Specifically, Staff was directed to explore the annual inflationary
process to include a new rate adjustment index and change the escalation cap from 5.00% to
10.00%. Additionally, Staff was also directed to include AVI's labor contact costs as one of the
indices used to calculate annual inflationary costs.
The Agreement with AVI provides for an annual rate adjustment based on a compensation
model presented within the Collection Service 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. The table below lists the currEnt indices indicated as Operating Cost Components in
Exhibit 2, Page 78, of the Collection Service Agreement and the proposed replacement indices.
RRI Calculati~n Cmm~nnPntc
' F'ormuta Com anent Current'Index ', Pro osed Index
Labor Waste Collection-Average Hourly Teamsters Union Local 70 Contract
Earnings (summation of monthly average per person
ceu60566210008 of sala + benefits + ension
Vehicle Replacement Transportation Equipment-Truck & Bus No Change
Bodies Sold Separately
w u141301
Vehicle Maintenance Machinery & Equipment-Parts, No Change
Attachments and Accessories
w u11440378
All Other Machinery & Equipment-Parts, Consumer Price Index - All Urban
Attachments and Accessories Consumers: San Francisco-Oakland-San
(wpu11440378) Jose, CA
cuura422sa0
Originally, AVI had proposed to replace the All Other category of the RRI with the Labor
Contract costs. As Staff and AVI have worked on the Amendment, both have come to agree
that a more appropriate location for it is in the Labor category. Staff and AVI then agreed upon
the Bay Area CPI's inclusion in the All Other category, which is the original index used for this
category and will have a smaller rate impact in the Fiscal Year 2010-2011 rate adjustment.
ADDITIONAL AMENDMENT PROVISIONS
During its work on the contract amendment, Staff and AVI have discussed opportunities to
provide for a long-term solution to service provision for the City of Dublin, which would be
financially beneficial to both entities. Specifically, the proposed amendment would extend the
contract term with AVI for an additional eight years, with a new termination date of June 30,
2020. This would benefit the City by locking in the low rate structure for the long-term,
maintaining the City's position as the low cost service provider in the Tri-Valley, and it would
benefit AVI by allowing it to restructure its financing obligations at a lower cost, as a result of the
guaranteed additional service provision period.
Page 2 of 5
If the City Council were to consider re-bidding the contract at its current termination date, June
30, 2012, it would not be unreasonable to expect that the new rates may increase to the level,
and possibly beyond, of the City of Livermore, which executed a new contract for garbage
services September 2009. This assumes that the City would continue to provide all services it
currently has in place, as adding or removing services affects overall service rates. By way of
example, in order for it to able to control its costs and keep overall service rates low, the City of
Livermore had to begin separately charging for commercial recycling services, which is still
included as a free service as part of Dublin's basic service rate under the proposed
amendment. Therefore, locking in the rates for the long-term with AVI best protects the interests
of the Dublin ratepayer. A cost comparison of the Amendment's impact with the rates of the Tri-
Valley Cities of Livermore, Pleasanton, and San Ramon is presented in Attachment 1. In nearly
all cases, the City of Dublin proposed rate is significantly below the average and below the next
most competitive city.
In addition to the City Council initiated contract amendments, AVI discussed with Staff the
revenue shortfalls that AVI has experienced over the past year due to losses in the commercial
sector. Annually, the rates are set to generate a sufficient amount of revenue to compensate
AVI for the collection services it provides to the City. While the model is not meant to be an
exact projection of the revenue needed, it is designed to provide a reasonable estimation of the
revenue needed to fairly compensate AVI for its services. AVI indicated to the City that it
expects to be nearly $500,000 under the model's estimation in the current year, and the rate
projection for next year will further decrease (approximately 8%) as a result of current
commercial conditions. This presents serious problems for the hauler, and ultimately for the
City, as a certain level of revenue generation needs to be maintained to ensure the financial
solvency of the Collection Service Agreement. To fix this problem, Staff and AVI have
negotiated a no-negative-growth provision and included this within the proposed amendment.
The effect of this provision is two pronged: first, it recasts the rate structure across the current
customer base, which recovers the losses experienced in the previous year, and second, it
provides a level of security to AVI in that rates will be maintained at their current level should
conditions continue to worsen or worsen again at some point in the future.
An additional request of AVI, in order to extend the contract term, was to include commercial
recycling within the annual rate adjustment model. As the City's commercial recycling programs
continue to grow over the extended term, AVI has concern that the financial model it built its
original bid estimate upon may no longer hold and that it may begin to lose money. Losses in
revenue are projected as commercial customers shift from revenue generating garbage service
to free recycling services. Currently, the rate model does not account for commercial recycling
as a revenue escalation factor in the rate structure, as the City has free commercial recycling
services that do not generate revenue. In order to lock in the rate over the contract extension
term and meet AVI's request, Staff has included this provision as part of the contract
Amendment. The item will not take effect until the Fiscal Year 2011-2012 rate adjustment. It is
likely that the impact of this inclusion will result in a 1%- 3% increase in the overall rate
structure in any given future year, depending upon new commercial growth and the
effectiveness of promoting the City's recycling programs to existing businesses. Growth would
include only new recycling services added after December 31, 2010.
In addition to the AVI request, Staff also negotiated a few items for inclusion within the
proposed amendment. First, Staff included a provision clarifying that all City facilities are to
receive access to garbage, recycling, and composting services free of charge. Under the
current contract, the only collection services provided free of charge to the City were for those
facilities listed within Exhibit 3 of the contract, which contains only those facilities that were
Page 3 of 5
extant as of July 1, 2005. The amendment deletes this exhibit and indicates that any City facility
extant or proposed will receive the appropriate level of service as determined by the City. This
will take into account future City service sites, new parks, etc. as well as those added since July
1, 2005 without the need of amending the contract on a continual basis.
Finally, in researching best management practices for inclusion in the contract extension, Staff
found that agencies often recover costs that have a nexus with solid waste generation from the
solid-waste hauler. For example, the City of Livermore, which, as mentioned above, negotiated
a new agreement as of September 2009, has instituted a number of fees to recover costs
regarding street sweeping, franchise monitoring and enforcement, collection vehicle impacts,
and neighborhood preservation, which is a fee designed to compensate for resolving health,
safety, and public nuisance problems. As Staff compared this to the City's current contract, it
noticed that there are a number of garbage related costs that the City's general and other funds
have been subsidizing over the past many years, which could be recovered from the solid waste
hauler through the proposed contract amendment. In order to consolidate and compensate for
these costs, Staff has negotiated an increase in the franchise and administrative fee paid to the
City by AVI for its rights to provide exclusive service to the City. Currently, the franchise fee is
set at 13.60% and the administrative fee is set at 2.00% of revenues received by AVI. Staff has
negotiated an increase of these values to 16.35% and 7.00% respectively. The agreement
allows the City to adjust the amounts as needed without an amendment, but for transparency
sake, this proposed change has been included within the amendment. This will result in
additional compensation to the City's General Fund, which could be used to offset costs for
street sweeping, street maintenance, litter abatement, and staff time.
As far as the above activities are concerned, Staff believes that these costs are necessary
components of a successful solid-waste program. Street sweeping, for example, occurs directly
following solid-waste-collection days to remove litter from our streets, which is left after pick-up
as well as to remove other refuse and debris from our streets for proper disposal. Street
maintenance costs have been included to account for the impact that solid waste collection
vehicles have on the City's roadways. In addition, the City has recently been placed under strict
requirements by the Regional Water Quality Control Board to abate litter and other
contaminants (e.g., used oil, which is collected by AVI) that may enter our storm-sewer system.
Finally, in order to ensure the City's environmental programs are managed in the long-term, the
increased revenue provides funding for 2.5 FTE Environmental Services Staff (1 Environmental
Specialist, 1 Environmental Technician, and 0.5 Secretary). The City has been using leftover,
one-time funding from the Waste Management Contract as well as Measure D funds, which
have been declining yearly to fund these positions. This will ensure stable funding for these
positions and continued sound management of the City's programs in the long-term.
As a result, Staff recommends increasing the franchise and administrative fees to reimburse the
City for these items. These proposed new revenues have not been included in the proposed
budget, which the City Council will review at its meeting on June 22, 2010. The additional
revenue will only occur after the City Council adopts the new rates. If adopted, a budget change
reflective of the additional revenue will be presented for City Council approval. Thus, Staff
recommends that the City Council adopt the Resolution approving a Fourth Amendment to the
Agreement with Amador Valley In~ustries, LLC and authorizing the City Manager to execute the
Amendment (Attachment 2).
NOTICING REQUIREIVIENI"S/~UBLIC OU7'REACC-i: A copy of the report has been sent to
AVI.
Page 4 of 5
e4TTAC H IVl E IVTS :
1. Tri-Valley Rate Comparison
2. Resolution authorizing the Fourth Amendment
to the Coliection Service Agreement between the
City of Dublin and Amador Valley Industries,
LLC.
Page 5 of 5
ATTACHMENT 1 - RATE COMPARISON
2010 Garbage Rate Comparison Survey (Prepared May 21, 2010)
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) ' $ 19.29 $ 29.13 $ 24.12 $ 24.18 $ 17.99 -25.60% $14.25 26.25%
1 Can Residential (64-70 Gallon) $ 42.40 $ 34.57 $ 42.18 $ 39.72 $ 33.04 -16.81 % $26.17 26.25%
% 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 .
Commercial Livermore Pleasanton San Ramon 3 City
Average Proposed
Dublin % Proposed
F Current % Increase
1 Yard - 1 time / wk $ 89.73 $135.97 $
113
19
$ 112
96
$ 80
21 rom Avg Ra te over Prior FY
2 Yard - 1 time / wk $ 179.46 $271.76 $ .
210.18 .
$ 220
47 .
$ 160
42 -29% $ 63.53 26.26%
3 Yard - 1 time / wk $ 269.19 $388.30 $
290.93 .
$ 316.14 .
$ 240
63 -27%
-24°/ $
$ 127.06
190 26.26%
3 Yard - 2 times / wk $ 560.77 $718.12 $
581.88
$ 620.26 .
$ 501
22 o
-19%
$ .59
396
99 26.26%
°
4 Yard - 1 Time / wk $ 358.92 $505.54 $
355.47
$ 406.64 .
$ 320.84
-21 %
$ .
254
12 26.26
/o
4 Yards - 2 times / wk $ 747.69 $945.30 $
710.94
$ 801.31
$ 661
64
-17%
$ .
524
05 26.26%
% Dublin Customers Covered By Sample Rate Categories: 71 % . . 2626%
Dublin's rates include free commercial recycling
San Ramon's rate does not include the cost of commercial recycling as the amount varies depending on the hauler used.
Drop Box
20 Yard Loose $ 377.06 $507.40 $ 652.86 $ 512.44 $ 451.40 -12% $ 357
6Q 26
24%
30 Yard Loose $ 565.59 $761.10 $ 677.73 $ 668.14 $ 677.10 1% $ .
536
40 .
26
24%
( 40 Yard Loose $ 754.12 $1,014.80 $
30 Yard Com
t
d 702.60 $ 823.84 $ 902.80 10% $ .
715.20 .
26.24%
~
' pac
e
$ 1,696.77 $1,521.90 $
% 833.15 $ 1,350.61 $ 1,353.30 0% $ 1
071
90 26
26%
Dublin Customers Covered By Sample Rate Categories: 84% ,
. .
~ Livermore rates do not include the cost of disposal/recyclin
which is assesed
ft ll
~ g,
a
er
Every effort has been made to assure the accuracy of the information and comparis co
ection.
on of simila
r levels of service according to our understanding of other agency rates.
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~ 1 ATTACHMENT 1
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RESOLUTION NO. XX - 10
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
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APPROVING A FOURTH AMENDMENT TO THE COLLECTION SERVICE AGREEMENT
BETWEEN THE CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES, LLC
WHEREAS, the City of Dublin ("City") entered into a Collection Service
Agreement ("Agreement") with Amador Valley Industries, LLC ("AVI") dated January 12,
2005; and
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, on June 23, 2009, the parties executed a Third Amendment to the
Agreement in order to modify certain indices used to calculate the RRI Factor, relating
to the Compensation Adjustment Model; and
WHEREAS, the Agreement allows for an annual compensation adjustment in
accordance with specified formulas; and
WHEREAS, AVI has requested that the City modify the rate adjustment
methodology to include its Labor Contact costs as one of the components of the Refuse
Rate Index ("RRI") used to adjust rates each year; and
WHEREAS, AVI has requested that the cap of 5.00% on the RRI be increased to
10.00%; and
WHEREAS, AVI has requested that no negative growth be allowed in the annual
rate adjustment process; and
WHEREAS, the City and AVI desire to extend the term of the Agreement for an
additional eight years; and
ATTACHMENT2
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WHEREAS, the City and AVI desire to include commercial recycling bins as an
element in the calculation of the annual growth factor, which is used to adjust rates; and
WHEREAS, the City desires to augment the franchise and administrative fee
rates; and
WHEREAS, the City further desires to modify provisions in the Agreement
relating to services provided to various City sites including, but not limited to City Parks,
fire stations, corporation yards, and community centers; and
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of
Dublin hereby approves the Fourth Amendment to the Collection Service Agreement
between the City of Dublin and 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 Fourth Amendment to the Agreement.
PASSED, APPROVED AND ADOPTED this 1 st day of June, 2010, by the
following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
City Clerk
Mayor
2
EXHIBIT A ~ ~' ~ ~
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FOURTH AMENDMENT
TO THE COLLECTION SERVICE AGREEMENT BETWEEN THE
CITY OF DUBLIN AND AMADOR VALLEY INDUSTRIES, LLC
This Fourth Amendment to the Collection Service Agreement, dated as of
, 2010 (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, on June 23, 2009, the parties executed a Third Amendment to the
Agreement in order to modify certain indices used to calculate the RRI Factor, relating
to the Compensation Adjustment Model; 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; to increase the RRI factor cap from 5% to;10%; to
modify the AG, AGT, and RRI Factors to clarify that negative values are not to be
included in the compensation adjustment model; to clarify that all CITY facilities receive
free City collection services; to modify the definition of Calculated Revenue to include
commercial recycling bins; and to extend the term of the Agreement, all on the terms
herein.
EXHIBIT A
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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. Section 1.13 is hereby amended to read as follows:
1.13 Citv Service Unit. Those CITY properties or locations owned and operated
by the CITY, including, but not limited to, Dublin Civic Center, Shannon Community
Center, Dublin Senior Center, Dublin Library, Dublin Corporation Yard, Dublin Fire
Stations, and all City parks and recreation facilities. The CITY Service Unit shall not
deposit dirt, rock, concrete, Exempt Waste or Construction and Demolition Debris in any
collection containers provided as required under the conditions of the Agreement.
Section 2. Article 2 is hereby amended to read as follows:
2.01 Term. The term of this Agreement shall be for a fifteen (15) year
period beginning July 1, 2005 and terminating on June 30, 2020.
2.02 Other Provisions. The CITY may, at the end of the term of this
Agreement, either renegotiate the terms and conditions of the Agreement with the
current CONTRACTOR or request proposals from qualified contractors to provide
Collection Services.
Section 3. Section 4.04.1 is hereby amended to read as follows:
4.04.1 Franchise Fee. The franchise fee shall be a percentage of
CONTRACTOR'S gross revenue collected each month under the terms of this
Agreement. Gross revenue shall specifically include revenue received by the
CONTRACTOR from any entity, including Federal, State, County or other local facilities
within the Service Area for the provision of Collection Services by the CONTRACTOR.
However, revenue received by the CONTRACTOR from the sale of recyclable materials
and from related California Redemption Value (CRV) payments shall not be considered
as gross revenues for purpose of the calculation of franchise fees. The franchise fee
percentage shall be sixteen and thirty-five-hundredths percent (16.35%) with respect to
revenue received for Services performed by CONTRACTOR after June 30, 2010 and
during the remaining term of this Agreement unless adjusted by the CITY.
Section 4. Section 4.04.2 is hereby amended to read as follows:
4.04.2 Administrative Fee. The administrative fee shall be a percentage of
CONTRACTOR'S gross revenue collected each month under the terms of this
Agreement. Gross revenue shall specifically include revenue received by the
CONTRACTOR from any entity, including Federal, State, County or other local facilities
within the Service Area for the provision of Collection Services by the CONTRACTOR.
However, revenue received by the CONTRACTOR from the sale of recyclable materials
and from related CRV payments shall not be considered as gross revenues for purpose
of the calculation of administrative fees. The administrative fee percentage shall be
EXHIBIT A
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seven percent (7.00%) with respect to revenue received for Services performed by
CONTRACTOR after June 30, 2010 and during the remaining term of this Agreement
unless adjusted by the CITY.
Section 5. Section 5.05.1.1 is hereby amended to read as follows:
5.05.1.1 RRI Factor. Effective as of the adjustment of Service rates
for July 1, 2010, the RRI factor shall be the lesser of ten percent (10%) or the sum of
the weighted percentage change in the Annual Average of each RRI index number
between the second (2"d) preceding calendar year (the "Initial Index Number") and the
preceding calendar year (the "Subsequent Index Number"), as contained in the most
recent release of the source documents listed in Exhibit 2, ("Compensation Model")
which is attached to and included in this Agreement. Therefore, the first RRI factor will
be based on the percentage change between the Annual Average of the RRI indices for
the year ended December 31, 2004 (the second (2"d) preceding calendar year) and the
Annual Average of the RRI indices for the year ended December 31, 2005, (the
preceding calendar year). The RRI factor shall be calculated using the Compensation
Model included in Exhibit 2. If, in any given year, the weighted percentage change is a
negative value, the RRI factor shall be set at zero percent (0.00%) for that year. For the
purpose of calculating Service rate adjustments, the Initial Index Number shall be the
number used as the Subsequent Index Number when the service rate adjustment
calculation was made the year before.
Section 6. Section 5.05.1.2 is hereby amended to read as follows:
5.05.1.2 Annual Growth Factor. Effective as of the adjustment of
Service rates for July 1, 2010, the AG factor for each compensation adjustment shall be
the percentage change in the beginning Calculated Revenue and the ending Calculated
Revenue. If, in any given year, the percentage change is a negative value, the AG factor
shall be set at zero percent (0.00%) for that year.
Section 7. Section 5.05.1.4 is hereby amended to read as follows:
5.05.1.4 Subsequent Calculations. Calculated Revenue shall be
the sum of the product of the Collection Service census data multiplied by the
appropriate Service rate. For the purpose of determining the AG factor for all
subsequent compensation adjustments, beginning Calculated Revenue shall be
calculated using the Collection Service census data as of the second (2nd) preceding
January 1 St and rates as of the preceding July 1 St, and ending Calculated Revenue shall
be calculated using the Collection Service census data as of the preceding December
31St and the rates as of the preceding July 1St. Therefore, to determine the AG factor for
the July 1, 2007 compensation adjustment, beginning Calculated Revenue shall be
calculated using the Collection Service census data as of January 1, 2006 and rates as
of July 1, 2006 and ending Calculated Revenue shall be calculated using the Collection
Service census data as of December 31, 2006 and the rates as of July 1, 2006.
For the purpose of determining the AG factor for the July 1, 2011
compensation adjustment, and annually thereafter, the Service rates shall also include
the imputed rates for multi-family and commercial recycling bins, which imputed rates
EXHIBIT A ~~ ~, ,
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shall be the same as the actual rates for the most comparable solid waste collection
Service for such customers (by size of container and frequency of service), and the
Collection Service census data shall include census data for multi-family and
commercial recycling bins.
Section 8. Section 5.05.7.2 is hereby amended to read as follows:
5.05.7.2 Annual Tonnaqe Growth Factor. Effective as of the adjustment
of Service rates for July 1, 2010, the ATG factor for each compensation adjustment
shall be the percentage change in commercial recycling tonnage between the second
(2"a) preceding calendar year and the preceding calendar year, as determined by
adding the collection data for MFD and Commercial Recycling Service contained in the
monthly recycling data reports described in Section 18.04.2. By way of illustration, the
Calendar Year 2007 reported commercial recycling tonnage is 1,831.62, and the
Calendar Year 2006 reported commercial recycling tonnage is 1,454.34. Therefore, the
ATG factor used for the Agreement Year 2008-2009 adjustment to the Commercial
Recycling Element is as follows: (1831.62 - 1454.34) / 1454.34 = 0.2594. If in any given
year the percentage change is a negative value, the ATG factor shall be set at zero
percent (0.00%) for that year.
Section 9. Section 5.12 is hereby amended to read as follows:
5.12 Calculation of Service Rates. CITY shall calculate, set and
maintain service rates at a level, based on the revenue forecasted to be received by
CONTRACTOR from charging such rates that can reasonably be expected to provide
compensation to the CONTRACTOR as calculated in Section 5.05 above. However,
the calculation of forecasted revenue shall not include forecasts for multi-family or
commercial recycling Services, or for Services provided to CITY.
Section 10. Section 5.13.1 is hereby amended to read as follows:
5.13.1 Subsequent Calculations. In preparing subsequent service rate
calculations, CITY shall use either the census data as of the preceding December 31St
or the most recent census data available as of any date after such December 31 st. As
part of the rate calculation process, CITY shall provide the rate calculations and
assumptions to the CONTRACTOR for their review. However, authority to prepare and
determine rate structures shall be at the sole discretion of the CITY
Section 11. Section 11.01 is hereby amended to read as follows:
11.01 CITY Collection Services. These services will be governed by the
following terms and conditions and shall be provided at no additional cost to the City:
11.01.1 Conditions of Service. The CONTRACTOR shall provide
CITY Solid Waste Collection Service, CITY Recycling Service, CITY Organic Collection
EXHIBIT A ~ ~
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Service and Roll-Off Container Service to all CITY Service Units in the Service Area
where the bins and carts are accessible as set forth in Section 11.01.3
Section 12. Effective as of the adjustment of Service rates for July 1, 2010, 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 Financiaf Statement Format
Operatinq Costs
~ ~";~ ~ ~
,
~
Labor: Series ID: Teamsters Union Local 70 Contract
List all administrative, officer, operation and maintenance salary accounts
List all pension, benefits, and workers compensation insurance expenses.
List payroll tax accounts directly related to the above salary accounts.
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.
AllOther: Series ID: cuura422sa0 Consumer Price Index - All Urban
Consumers, as published and maintained by the United States Bureau of Labor
Statistics for San Francisco-Oakland-San Jose, CA (1982-84=100)
List all other expense accounts related to the services provided under this Agreement.
This category includes all insurance including general liability, fire, truck
damage, and extended coverage but excluding workers compensation
and employee group insurance; 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; 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 develop the overall com ensation and does not inciude actual data.
step Collection Compensation Element
~ Calculate RRI Factor
1a Use model to Input current year indices Annual Avera e Calendar Year 12/31
Indices 2009 2010 2011 2012
Teamsters Union Local 70 Contract (summation of monthly
average per person of salary + benefits + pension) 5592.53 7188.08 7,559.70 8003.45
Series ID: wpu141301 Transportation Equipment- Truck &
Bus Bodies Sold Se arately 169.7 171.40 173.60 174.60
Series ID: wpu11440378 Machinery & Equipment-Parts,
Attachments and Accessories 129.5 131.30 132.40 135.10
cuura422sa0 Consumer Price Index - All Urban Consumers
- San Francisco-Oakland-San Jose, CA 180.2 189.90 193.00 196.40
1 b Moci~l"caFaulaLes'~~ change in curre~tt and ~rior year indices :
Delta % Previous Year to Year Annual Avera e Calendar Year 12/31
2009 2010 2011 2012
Series ID: Teamsters Union Local 70 Contract ':' % 28.53% 5.17% 5.87%
Series ID: wpu141301 Transportation Equipment - Truck &'
Bus Bodies Sold Se aratel ' 1.00% 2.30% 1
87%
Series ID: wpu11440378 Machinery & Equipment-Parts, .
Attachments and Accessories ` 1.39% 2.24% 2.89%
Series ID: cuura422sa0 Consumer Price Index - All Urban
Consumers - San Francisco-Oakland-San Jose, CA 4.04% 5.33% 2
57%
1 c Use "RRI tn u~' Moetu[e to input ~QN'fEtAC"C(~R financia! data .:.. .
Contractor Financial Data Annual Avera e Cal endar Year 12/31
2009 2010 2011 2012
Labor $ 1,375,000 $1,443,750 $1
515
938
Vehicle Replacement , $ 248,000 $ 260,400 ,
,
$ 273
420
VehicleMaintenance ~~~ < ; $ 246,000 $ 258,300 ,
$ 271
215
AllOther ', $ 2,779,000 $2,917,950 ,
$3,063,848
$ 4,648,000 $4,880,400 $5,124
420
1 d Made1 cafcuFates weigMting factor for each categvry ,
Contractor Wei htin % Annual Avera e Calendar Year 12/31
2009 2010 2011 2012
Labor 29.58% 29.58% 29
58%
Vehicle Replacement 5.34% 5.34% .
5
34%
Vehicle Maintenance 5.29% 5.29% .
5.29%
AllOther 59.79% 59.79% 59.79%
Total 100.00% 100.00% 100.00%
1e Model multiplies index change (1b) by weighting factor (1d)
RRI % Annual Average Calendar Year 12/31
2009 2010 2011 2012
Series ID: Teamsters Union Local 70 Contract 8.44% 1.53% 1
74%
Series ID: wpu141301 Transportation Equipment - Truck & .
Bus Bodies Sold Se aratel 0.05% 0.12% 0
10%
Series ID: wpu11440378 Machinery & Equipment-Parts, ~ .
Attachments and Accessories 0.07% 0.12% 0
15%
Series ID: cuura422sa0 Consumer Price Index - All Urban .
Consumers - San Francisco-Oakland-San Jose, CA 1.81 % 2.39% 1.15%
RRI Factor 10.37% 4.16% 3.14%
Allowed RRI Factor 10.00% 4.16% 3.14%
Page 79
1
EXHIBIT A `~~~ wY...
~ '_ ~ ~
Section 13. Exhibit 3 of the Agreement is hereby deleted.
Section 14. 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:
By:
Joni L. Pattillo
City Manager
Attest:
By:
Caroline Soto
City Clerk
APPROVED AS TO FORM:
By:
John D. Bakker
City Attorney
AMADOR VALLEY INDUSTRIES, LLC,
a California Limited Liability Company
Dated:
By:
its: