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Home My WebLink AboutItem 4.19 AVI Collection Services Amendment CITY CLERK File # D~[?l][?2]-~[ll] AGENDA STATEMENT CITY COUNCIL MEETING DATE: June 20, 2006 SlIBJECT. Amendment No 1 To Collechon Service Agreement Between City of Dublin and Amador Valley Industries, LLC - Conecting Discrepancy (pages 78 and 79- Exhihll 2- Reference to Series ill Index To Be Apphed Against All Other Operating Cost Category) Report Prepared bv Paul S. Rankin Administrative Services Director ATTACHMENTS; 1 2. Current Agreement Pages 78 and 79 Resolution Containing Proposed Amendment r( RECOMMENOA TION:Sl? ~ Authorize the City Manager to execute the amendment on behalf of ~\ the City of Dublin. FINANCIAL STATEME:NT: The agreement contams lllcomlstent references to the Bureau of Labor Stabstlcs mdex to be apphed m developmg rale adjuslments. The proposed adjustment for 200612007 is conSlslenl wllh Ihls amendment. OF-SCRIPTION: Tn the agreemenl Wllh Amador Valley Tndnstries (A VI) a compensation model iarmat is presented. When Staff provided A Vi with the methodology used for the 200612007 rate adjustment, Company representatives questIOned the apphcahon ofthe All Urban Consumer Bay Area CPT to the portion of the Company expenses designated as "All Other" in the Agreement Exhihl t 2 begins with a narrative description of the Compensation Adjustment. On Page 7R IS a narrahve for the following Operational Cost Components: Formula Com oneut LABOR VEHICLE REPLACEMENT Narrative Oescri tion P 78 Waste Cullectiun Avg Huurly Earnings ceu60562 10006 Mutur V chicle Mig- V chicles On Purchased Chassis ( cu3362113362113) Indu,trial Truck & Tractur Mfg.-Pam for Industrial Work Trucks cu3339243339243 Industrial Truck & Tractor Mfg.-Parts for ImlLls trial Wark Trucks (pcu3339243339243I Reference!i_!.ll!mula Pg}9 SAME SAME VEHICLE MAINTENANCE SAME ALL OTHER CPI- All Urhan Consumers All Items - Bay Area cuurx400saO _~__~_______.___w_.~~___.____..___________________________._________________________________________________. COpy TO: Amador Valley Industries Page 1 of2 ITEM NO. 3.1 ~ F.\( iarhagc\200(1 R~tc A.rlj\A(iFNI)A IAgcnrlast.mt_ amcnctAgmnt.cloc cJ Copies oflhe pages m the current agreement are attached to this report and the seclJons with the dil1cring language are noted. The original approach used by Staff was to apply the CPI Illdex as stated on pagc 79 of the Agreement. This was the IdentIfied mdex dIscussed dunng the RFP process prior to the preparatIOn o[(he final agreement. Company representativcs objccted to the use of the CPI index and they suggested that the Tndllstnal and Truek manufacturing indcx better reflected the nature of expenses in the "All Other" category They indicated that they had relied on th,s assumption. Although lt lS beheved to he a drafting crror on page 78, Staff indicated to Company representatives that they wonld stand by thc language on page 78 and use that reference on page 79 Given that these indexes incrcase or dccrease independent of each other, lt IS Impossihle to predict what the impact will be on the contract over a 7 year penod. For thc ~urrent adjustment the Industrial index lS greater than the CPI. Thcrc is no guarantcc that this will always be the case. Nevertheless, Staff felt it was appropriate to correct the Agreement to elinunate the dlscrepan~y III ihe futurc. Staff recommend that the City Council authonze the City Manager to cxccutc Amendment No 1 to the Agreement. ~ Db 0>.. EXCERPT CURRRNT AGREEMENT Betweeu Amador Valley Industries & City ofOubliu (Oated January 12, 2005) llf()L-~ Collection Service Agreement ODeratino Costs Exhibit 2 City of Dublin. CA Compensation Adjustment RRI Financial Statement Format Series 10- eeu605621 0006 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. Vehicle Replacement: Series 10. peu3362113362113 Motor Vehicle Mfg_- Vehicles on Purchased Chassis List all Collection and Collection related vehicle depreciation accounts. List all vehicle iease or rental accounts related to Collection or Collection related vehicles. Labor: Vehicle Maintenance: Series 10- pcu3339243339243 Industrial Truck & tractor Mfg. - Parts for Industrial work trucks . all Collection or Collection related vehicle parts accounts. All Other: Series 10. pcu3339243339243 Industrial Truck & tractor Mfg. - Parts for Industrial work trucks List all ot er 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 subscription; advertising; employee retirement or profit sharing contributions; and miscellaneous other expenses. \\ Page 78 City of Dublin {p- 2.0 -04> tift ATTACHMENT 1 RXCERPT CURRENT AGREEMENT Bctweeu Amadllr Valley Tndustries & City of OubIiu (Oated Jauuary 12,2005) p~~ Collection Service Agreement Exhibit 2 City of Dublin, CA Compensation Adjustment Model The annual compensa on e Justment IS ca culated in accordance with the procedures set forth in ceo e 0 eo on erv ce Agreement. This exhibit is provided as an example of how the individual calculations are used to develop the overall compensation adjustment. Step 1 18 Use model to In ut curarient ear IndlcQ.1!i IndlceB Collection Com ensatlon Element Calculam RRI Factor wei htin factor 1 d Ar'Ir'lui'lJ Avllllr~ . c.I.ndtllr Vllmr Endud 12/31 '004 .... '00. '007 12.97 14.48 13.64 15_33 16".7 171.40 173.60 174_60 129,5 131.30 132.40 135_10 180_2 189.90 193.00 196.40 Annual Avera Calendar Vear Ended 12131 200. 2006 2007 11.64% 5_17% 5.87% '-00% 2.30% 1,87% 1.39% 2,24% 2,89% 4.04% 5.33% 2.57% II Doltlll % Previous Vear to Year II SeriA~ ID: c6uao56210006 Waste Collectlun. Average Hourly Earning!! Series ID: pCU3382113362113 Motor Vehicle Mtg.- Vehicles on P~m:hF.lsed Chassis Serieg ID: pcu3S:392433JS243 Industrial Iluck & tractor Mfg. - Parta for sIr w k Serle::; I onsumlJrs - Alllle-r'r\s BI:I Area 10 Labor Vehicle Re lacement Vehicle Maintenance All Other Al'lrill,fl1 Avo:~ 0: Cifll""'~r V.- I!nd.d 12/31 '00$ '000 '007 $ 1,375,000 $ 1.443,750 $ 1,515,938 $ 248.000 $ 260 400 $ 273.420 $ 246 000 $ 258 300 $ 271215 $ 2,779.000 $ 2,917,950 $ 3,063,8'8 4,648.000 4,8804 5, 4. ld ~ .1<lQ ~, Contractor Wel "tin ''!Z:I'j,J~'j"Yf:,\~fit;';'t",)";:;'i~:~~i,Yffiii'\':'w:!t;70:(1;\W/ f ;::,~,L:~',:;,:>F~i' ,i ,0::, :~~;:t;~]:"L<:::}:~ labor VehilcE;! R.a lacement Vehicle Maintenance AlIOlh~r Total 1e Model multi liB@; Index ehan lit 1b RRI% AI'InI,l~1 A\lor~ 0 C8101'l(l,flr YOf.ll~ ~l'Id.d 12/31 2005 2006 29.58% 29.58% 5,34% 5,34% 5.29% 5.29% 59,79% 59.79% 1 1 ,00 2007 29.58% 0.34% 5.29% 59.79% 100,00 Series 10: ceu6056210006 Wa!:lte Collection - Avera e Houri Earnln s Sorles ID: pcu3362113362113 Motor Vehicle Mfg.- Vehicles on Purchased Chassis Series ID: pcU333S243339243 Industrial Truck & tractor Mfg. - Pa.rts for Industrial work trucKs anas : cuurx4nOsaO r an Onsumers - terns - ay rea actor owe ac or Annual Avara a Calandar Vear Ended 1213' 2005 200B 3.44% 1.53% 2007 1.74% 0.05% 0.12% 0.10% 0.07% 1,81% 0,12% ;2.39% 0.15% 1.15% "'''>O~4i; I;'I~~-:~\ I;,. ... - -.... .,!.,~~;~I ~. >.. .7;j/ , !4.~!A~.~'i.,'" ATTACH~N't 1 RRSOLUTION NO. xx - 06 ~~b if A RESOLUTION 01<' THE CITY COUNCIL OF THE CITY OF DUBLIN ********* APPROVING AMENOMENT No.1 TO AGRRRMENT WITH AMAOOR VALLEY INOUSTRIES, LLC FOR SOLID WASTE COLLECTION SRRVICES WHEREAS, the City of Dub 1m has an eXlstmg agreement with Amador Valley hldustnes, LLC dated January 12, 2005, and WHEREAS, thc Agrecment contains a detailed methodology for thc adjustment of compensatIOn to the Company; and WHEREAS, on pages 7H and 79 there are mC(mSlstent refercnccs to the index to be apphed to the "All Other" category of Company cxpenscs; and WHEREAS, it is deSlTable to anlend the agreement in a manner that will avoid any confusIOn as it is adml111stered over the next several years. NOW, TllEREliORE, BE IT RESOLVED that the City Council of the City of Dub 1m herehy approves thc amcndmcnt no. I to the agreement (attached hereto as Exhihit A) with Amador Valley Industries, LLC BE IT FURTHER RESOL VED that the City Manager IS authorized to cxccutc the agreement. PASSED, <\PPROVED AND ADOPTED this lOt" day of June, 2006. AYES NOES ABSENT ABSTAIN Mayor ATTEST City Clcrk Attachment 2 EXHIBIT A AMENOMENT No.1 TO ACRRRMRNT BETWEEN CITY OF OUBLIN ANO AMAOOR V ALLEY INODSTRIRS, LLC FOR SOLID W ASTR COLLECTION SERVICES 400 f Recitals WHEREAS, the parties City of Dublin, hereinafter "CITY" aud Amador Valley Industries, a Califomia hmlted liability corporation, hereinafter "CONTRACTOR" entered into an Agreement dated January 12, 2005, and WHEREAS, Exhibit 2, pages 78 and 79 of the Agreement contain a methodology for the adjustment of compensation and calculation of the RID Factor (as defined in section 5 05 I I of the Agreement); and WHEREAS, on pages 78 and 79 there are inconSistent references to the index to be applied to the "All Other" category of Company expenses; and WHEREAS, the parties desirc to have a consistent reference to the Index to be applied. NOW, THEREFORE, "CITY" and "CONTRACTOR" through their legal representatives as signed below agree to amend page 79 of the Agreement as follows: The words in the cell preceding line l(b) III the CompensallOn Adjustment Modcl on page 79 which read: "Series ill. cuurx400saO CPI- All Urban Consumers All Hems Bay Area" shall be deleted and replaced with. "Series IQ: ocu3339243339243 Industnal Tmck & Tractor Mfg. - Parts for Iudustnal Work Trucks" 2. The words in the cell preceding line l(c) In the Compensation Adjustment Model on page 79 which read: "Senes m. cUllrx400saO CPT- All Urban Consumers All Items - Bay Area" shall be delctcd and replaced with. "Series ill: oeu3339243339243 Industnal Tmck & Tractor Mfg. - Parts for Iudustnal Work Trucks" 3. All modifications to Company compensation pursuant to the Agreement shall utilize this change unless the Agreement is further amended In wnting_ IN WITNESS WHEREOF, the CITY and the CONTRACTOR have executed this amendment dated June 20, 2006 FOR CITY ATTEST RIchard C Ambrose, City Manager Fawn Holman, City Clerk APPROVED AS TO FORM. City Attomey FOR CONTRACTOR. - Robert J Molinaro, President Amador Valley Iudustnes, LLC Attachment 2 , k~~L~ RESOLllTlON NO. xx - 06 A RESOI ,UTI ON OF THE CITY COUNCIL OF THE CITY OF DUBLIN ********* APPROVING AMENDMENT No.1 TO AGREEMENT WITH <\.MADOR V ALLEY INDUSTRIES, LLC FOR SOLID W <\.STE COLLECTION SERVICES WHEREAS, the City of Dublin has an existmg agreement with Amador Valley Industries, LLC dated January 12, 2005, and WHEREAS, the Agreement contams a detalled methodology for the adjustment of compensatIOn to the Company; and WHEREAS, on pages 7R and 79 there are inconsistent references to the index to be applied to the "All Other" category of Company expenses; ,1I1d WHEREAS, it is deslrahle to amend the agreement III a manner that will aVOId any contusion as It is administered over the next several years. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dub 1m hereby approves the amendment no. I to the agreement (attached hereto as Exhibit A) with Amador Valley lndustnes, LLC BE IT FURTHER RESOL VED that the City Manager is authonzed to execute the agreement. PASSED, APPROVED AND A"DOPTED th,s 20th day of June, 2006 AYES. NOES: ABSENT ABSTAIN Mayor ATTEST -... Citv Clerk R' e.Vl$.e.4 {r e;l.o-ol.:> I.f.l't i\ttaehment 2 't . EXHIBIT A AMENDMENT No.1 TO AGREEMENT BE~TWEEN CITY OF DUBLIN AND AMADOR V ALLEY INDUSTRIES, LLC FOR SOLID WASTE COLLECTION SERVICES Recitals WHEREAS, the parties City of Dublin, hcrcinaticr "CITY" and AmadorValJey Industnes, a CalifornIa lirmted liability corporatlOn, hereinafter "CONTRACTOR" entered into an Agreement dated January 12, 2005, and WHEREAS, Exhibit 2, pages 78 and 79 of the Agreement contain a methodology for the adjustment of compensatlOn and calculation of the RRI Factor (as defined 111 section 5051 1 of the Agreement); and WHEREAS, on pages 78 and 79 there are mconSlstent references to the index to be applied to the .'All Other" category of Company expenses; and WHEREAS, the partJes desire to have a consistent referencc to the index to be applied. NOW, THEREFORE, "CTTY" and "CONTRACTOR" through their legal representatives as signcd below agree to amend page 79 of the Agreement as follows' In Sten la, the words describing lhel{lurth Senes lD hsted The wereSiB1h~Il~l1il"l'elil~ll,i'Bg'lillcJ(h)in the Compensation Adjustment Modd m, page 79 whIch read. "Senes ID' cuurx400saO CPI- All Urhan Consumers All Items" Bay Arca" shall be delctcd and replaced with. "Senes ID: pcu333924333')243 Industnal Tnlck & Tractor Mfg. -J~.m1sJQrJll<:!.1l_~trial Work Tmeks" 2. hlBtep) b, thc words describmg the fourth Senes UL!J:;;led The wfams iB#l~e811I"F8eoomg liRsl+e+.in the Compensation Adjustment Mudel On page 79 whIch read. "Senes ID' cuurx400saO CPI- AU Urhan Consumers All Ttems - Bay Area" shall be deletcd and replaced with. "Senes ID: pcu3339243339243 Tndustnal Imck & Tractor Mf~. Parts lor Industnal Work Trucks" 3. In Step] e, the words describmg the fourth Senes lD li:;l\;gjil the Compcnsation Adiustment Mod9L9l! pa~e 7') which n;~(;l. "S"rws ID: Cllurx40()sa(l CP1- All Urban Consumers All It"l!lli.::J~.a..Y.Are"-".:;h;JIL!2.e deleted amI replaced with. "Series 1D: reu3339243339243 Tndusmal Truck & Tractor Mfg. - p,lrlS for Industrial Work Truck:;':, :\.-4 A II modifications to Company compensal]()n pursuant to the Agreemcnt shall utilize this ehangc unkss the Agreement IS tilrther amended in wnlIng. IN WITNESS WHEREOF, the CITY and the CONTRACTOR havc executed thrs amendment dated .Tune 20, 2()(1() FOR CITY ATTEST Richard C Ambrose, City Manager Fawn Holman, City Clerk APPROVED AS TO FORM Attachment 2 ~ City A.ttorncy FOR CONTRACTOR. Robert J Molinaro, Pres, dent Amador Valley Industries, LLC Attachment 2