HomeMy WebLinkAboutItem 8.2 Hear Date Garbage Rate AGENDA STATEMENT
CITY COUNCIL MEETING DATE: June 6, 2000
CITY CLERK
File # 0810-30 / 0600-30
SUBJECT:
Establishing The Date Of The Public Hearing For Property Related Fees For
Garbage Company Rates and Annual Fees For Minimum Residential Garbage
Service, Approving Amendment to Garbage Franchise Agreement and
Consideration of Proposal to Provide 64-Gallon Recycling Carts to Dublin
Residents
Report Prepared By: Jason Behrmann, Management Assistant
ATTACHMENTS:
2.
3.
4.
5.
Resolution Approving the Franchise Agreement Amendment
Comparison of Proposed Rates To Current / Selected Categories
Garbage Rate Survey (Livermore/PleasantordSan Ramon)
Public Notices
Excerpts from the City's Franchise Agreement
RECOMMENDATIO~y~:
3.
Establish the Public Hearing for August 1, 2000.
Adopt the Resolution approving the Amendment to the Franchise
Agreement regarding the interpretation of Prior Year
Compensation.
Provide direction to Staff regarding Livermore Dublin's proposal
to provide 64 gallon recycling carts to Dublin residents
If the Council decides to provide the 64 gallon carts, authorize
the City Manager to negotiate an agreement with Livermore
Dublin Disposal to acquire the carts using the City's Measure D
fund reserve, for a total not to exceed $200,000.
FINANCIAL STATEMENT: See Below
DESCRIPTION:
Background
In 1995, Thc City entered into a Franchise Agreement with Livermore Dublin Disposal (LDD) to provide
garbage collection services for the City of Dublin. The agreement between the City and LDD requires the City
to adopt a rate schedule, which is estimated to produce a specified revenue amount. The target revenue
amount is determined in accordance with a specific schedule, adjusted by inflation factors.
COPIES TO: Annette Borges, District Manager, LDD
ITEM NO. ~
The City has also adopted an Ordinance, which requires all parcels in the City to subscribe to weekly
minimum garbage service. For residential properties which are serviced with individual containers, the City
collects the annual cost of minimum service with the property tax bill. This minimum service includes a 35
gallon garbage container, 64 gallon green waste cart, 3-11 gallon recycling crates and three annual clean-ups.
Residents desiring larger carts are billed directly by the Company for the rate difference. The City pays the
service cost for minimum residential service with monies collected with the property tax bill. The amount
paid to the Company is based upon the adopted rate schedule for minimum service. The Company bills all
other customers directly pursuant to the City's adopted rate schedule
GARBAGE RATE CALCULATION AND FRANCHISE AGREEMENT AMENDMENT
Garbage Rate Background
The current garbage rates became effective July 1, 1999. In accordance with the Agreement with LDD, the
adopted rates were scheduled to be reviewed for a rate adjustment July 1, 2000. The Company was allowed to
adjust in the future its revenue requirement, by a formula which accounted for: (a) changes in the Consumer
Price Index (CPI); (b) changes in Landfill regulatory fees; and (c) an adjustment for the number of tons placed
in the landfill. The formula places a 5% cap on the growth of total revenue estimated to be generated by the
increased rates.
Collection Compensation and Franchise Agreement Amendment
Based upon the formula in the existing agreement, the annual adjustment applies a CPI factor to Collection
and Disposal costs. For the Collection adjustment, the Agreement provides that only 80% of the annual
change in the CPI is applied to the Prior Year Collection Compensation. Therefore, although the published
CPI factor for the period was 4.1%, the adjustment to the Prior Year Collection Compensation is 3.28% (80%
of the CPI Factor).
During the course of performance under the current Franchise Agreement, different interpretations have been
used to determine how Prior Year Company Collection Compensation would be calculated. In order to clarify
this definition in the Franchise Agreement, Staff has drafted an Amendment, which will establish how the
Prior Year Collection Compensation is calculated.
During the rate adjustment for Fiscal Year 1998-1999, the Company and the City agreed that Prior Year
Collection Compensation would be defined as an estimate of the actual compensation that the Company
would receive in Fiscal Year 1997-1998, based on subscriber census data as of March 1998. This Prior Year
Collection Compensation was then adjusted by the CPI to determine the required compensation for Fiscal
Year 1998-1999.
However during the rate adjustment for Fiscal Year 1999-2000, both parties agreed to a different
interpretation that defined Prior Year Collection Compensation as the estimated compensation for Fiscal Year
1998-1999, based on subscriber census data as of March 1998, instead of March 1999, as would have been
done under the 1998-1999 interpretation. The new Prior Year Collection Compensation was then adjusted by
the CPI to determine the required compensation for Fiscal Year 1999-2000. The 1999-2000 Prior Year
Collection Compensation interpretation did not take into account the growth in garbage subscribers. These
different interpretations do not have much significance when the City is growing at a relatively slow pace,
because the subscriber census data from one year to the next would not change significantly, but when the
City is growing rapidly, the subscriber census data for the two years would be very different.
While calculating the rate adjustment for Fiscal Year 2000-2001, the City and the Company realized that use
of the 1999-2000 interpretation during a period of rapid growth in subscribers, could have negative effects for
both the Company and the City. Under the 1999-2000 interpretation, Company Compensation would not
incre~ise to reflect the growth in subscribers. Staff found that, even under current rates, the revenue from the
' rates and subscribers was so much greater than Company Compensation required by the Agreement that the
City would either have to reduce rates or eliminate the Measure D residential recycling subsidy. Moreover, as
long as the recent growth continued, Company Compensation would stagnate, creating the possibility for a
sharp furore increase in rates, which would have greater fiscal impact on both the City and subscribers than
the small regular increases in Compensation and rates that would result from the use of the 1998-1999
interpretation.
Under Section 6.8 "Extraordinary Adjustment" of the Franchise Agreement, the Company is allowed to apply
for an extraordinary rate adjustment if growth or other factors have significantly increased the Company's
costs. The Company recently pursued this option in Livermore. The new rate application process cost the City
of Livermore and the Company $100,000 for consultant assistance and resulted in large rate increases for
Livermore residents and businesses. The residential rates increased 10% in January 2000 with another 10%
increase required in January 2001. Commercial rates rose approximately 25%.
In order to avoid this costly process, the City has drafted an Amendment to the Franchise Agreement
(Attachment 1) that will compensate the Company for the growth in the City, and prevent the City from
experiencing double-digit rate increases in the future. The Amendment does not change the original Franchise
Agreement, but rather confirms the interpretations of the meaning of Prior Year Collection and Disposal
Compensation. Under the terms of the Franchise Agreement Amendment, the Company and the City agree to
interpret Prior Year Collection Compensation as the estimated actual compensation that the Company receives
during the prior year, based on the subscriber census data as of December 31st of the Rate Year in which the
Company is calculating Company Collection Compensation. This will provide a good estimate of the actual
Collection Compensation for the prior year, similar to the 1998-1999 rate adjustment interpretation. In return,
the Company agrees not to exercise its rights under Section 6,8 of the Franchise Agreement that would allow
it to submit a new rate application for an extraordinary compensation adjustment. Staff feels that this
interpretation will provide the Company with a fair compensation adjustment based on CPI and other factors
as originally intended in the Franchise Agreement, and that it protects the City from large future rate
increases. The City is guaranteed only moderate annual rate increases because of the 5% cap on revenue
growth included in the Franchise Agreement. The Compensation numbers and rates provided in this report are
based on the Prior Year Collection interpretation as described in the Franchise Agreement Amendment.'
The Collection Compensation for Fiscal Year 2000-2001 under the new Agreement is $2,288,792.
Disposal Compensation
The Disposal cost is adjusted based upon two factors: 1) 100% of the CPI for the period; and 2) estimated
tonnage, which fluctuates from year to year. The full CPI factor of 4.1% is applied to the Prior Year Base
Gate Rate for Disposal. Additional fees levied by agencies in the County (Measure D, County Open Space
Fee, County Inspection Fee, etc.) are then added to the base rate.
The new 2000 adjusted gate rate, excluding City franchise and administrative fees, is $32.64 per ton. This
amounts to a 5.8% increase over 1999. Approximately 38% of the gate rate is fees levied by agencies in the
County (Measure D, County Open Space Fee, County Inspection Fee, etc.). In order to determine total
disposal costs, the new gate rate is multiplied by projected tonnage. For rate setting purposes, projected
tonnage equals actual tonnage for July through February and a projection for the remainder of the Fiscal Year.
The Disposal Compensation for Fiscal Year 2000/2001 is $1,009,533.
Total Company Compensation
In addition to the Collection and Disposal Compensation calculations, the City levies franchise and
· administrative fees of 14.6%. Including these City fees, total "Target" compensation is $3,862,207.
Once the "Target" compensation amount is determined, Staff calculates the revenue generated based upon
current subscriber data. In addition to the revenue from rates, the City currently offsets a portion of the
Residential Recycling Program's cost with a separate payment of Measure D Funds. This includes both the
Single Family and the Multifamily recycling programs. The Fiscal Year 1999/2000 contribution was $89,000.
Staff proposes no change in Fiscal Year 2000/2001. Using the current subscriber census, with the current rates
and the Measure D subsidy, the Company is projected to generate $3,723,307 in revenues. This results in the
need for the proposed adjustment to the rate structure to generate an additional $138,900 during Fiscal Year
1999-2000, which will make up the shortfall. (Difference between $ 3,862,207 target compensation per
formula and the $3,723,307 generated by current subscriptions at current rates.)
PROPOSED RATES BASED ON AMENDMENT
Rate Calculation Methodology
Once the Target Compensation was determined, Staff used data gathered from the previous calendar year
regarding the number of customers and service level selected to adjust the rates. Staff has allocated the
revenue deficiency based upon both Disposal and Collection in proportion to the Total Revenue. This was
then distributed by major class of service (i.e. Residential, Commercial, and Drop Box). The proposed Rate
Structure is estimated to nearly approximate the Total Target Compensation.
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 2000/2001 is
$122.40, which equates to $10!20 per month. The monthly equivalent is the same amount the City will pay
the company. The additional cost of collection and delinquencies 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 proposed annual assessment for 2000/2001 represents a 1.49% increase over the Fiscal Year 1999/2000
assessment. The following table shows the historical annual assessments:
Historical Annual Fee For Minimum Garbage Service Collected With Property Tax Bill
1995/1996 1996/1997 1997/98 1998/99 1999/00 Proposed 2000/01
$121.30 $112.60 $114.90 $119.40 $120.60 $122.40
Detailed Comparison of Current and Proposed Rates
Attachment 2 contains a detailed comparison of the proposed rates to current rates for the most common
subscription levels for residential, commercial and drop box subscribers. The actual percentage increase in
the proposed rate depends on the type of service. The smallest increase is for the minimum service fees
collected with the property tax bill previously discussed. The increase for the larger 64 and 96-gallon
residential carts is 3.88%. The greater increase for the larger containers is designed to encourage residents to
· reduce their garbage service by increasing their recycling.
Commercial rates are increasing by approximately 3.72%, depending on the level of service. The increase
represents an effort to gradually increase Dublin's historically low commercial rates. Even with the increase,
Dublin's rates are at least 33% lower than the Tri-Valley average. The low commercial rates make it difficult
to encourage recycling. Typically businesses are more likely to recycle when the cost of recycling is much
lower than the garbage service. Dublin's current rates provide very little incentive to recycle.
' The drop-box service rate increase is 5.26%. Drop-box disposal tonnage increased by nearly 60% from 1998
to 1999. Drop-box tonnage now represents approximately 40% of all waste generated in Dublin. The new
Construction and Demolition Debris Ordinance is intended to reduce the amount of this material going to
landfill; however, similar to the commercial rate, the low drop-box rates make it difficult to encourage
recycling. The rate increase is intended to bring Dublin's rates closer to the Tri-Valley average. The new drop-
box rates would still be 8% below the Tri-Valley average.
The proposed rates would go into effect beginning July 1, 2000.
New Altamont LandfilI Host Community Fee
The County recently approved a Conditional Use Permit for the Altamont Landfill that includes a 1.00/ton fee
that is being levied on all users of the Landfill. LDD has requested that this fee be included in the 2000/2001
rate calculations. This new fee would cost Dublin ratepayers $36,216 for Fiscal Year 2000/2001 or an
additional $.05 per month for a35 gallon cart with larger increases for other levels of service. The monthly
minimum residential service fees would be $10.15, if the additional $1.00/ton fee were not included in the
rates. A portion of the fee is to be used to purchase open space in the Dublin/Pleasanton area.
Rate Comparison to Neighboring Jurisdictions
As indicated above and as shown on Attachment 3, the proposed City of Dublin rates remain very competitive
compared to rates charged for similar services in surrounding communities. Residents and businesses are
paying less for services under the Agreement negotiated by the City of Dublin, than customers in surrounding
cities. It should be noted that the methods used in waste handling as well as the Disposal location can be
factors affecting a rate comparison._ For all rate categories, the proposed City of Dublin rates are less than the
average of the Tri-Valley agencies surveyed.
In all cases involving residential services, the City of Dublin service levels are at least comparable, and in
some cases better than the survey cities. For example, both Livermore and Pleasanton offer Residential Green
Waste collection only every other week. Therefore, the City of Dublin residential subscribers receive more
serVices. The provision of special curbside clean-up days are not included as part of the Pleasanton residential
services. It should be noted that the City of Pleasanton is expected to consider a rate increase in July and this
would improve the competitiveness of the Dublin rates in comparison to the local area. Livermore is also
expected to raise rates beginning January 1,2001.
Approval Process
In accordance with Proposition 218, Staff will be mailing the attached Notices (Attachment 4) to all parcel
owners in the City of Dublin. Assessor records indicate that there are approximately 9100 parcels with valid
mailing addresses. In order to reduce mailing costs, Staff will consolidate the notices to parcels where the
same owner holds title to multiple parcels. The notices must be mailed 45 days prior to the hearing, which
will require them to be delivered to the Post Office by June 16, 2000.
The Notice will include three separate pages. The first two pages include a Summary which identifies the
City Council Public Hearing date and time (August 1, 2000 7:00 p.m.). In addition, this notice explains what
is required to protest the imposition of the fee. In the event that the City receives a written protest from owners
representing over 50% of the affected parcels, the enactment of the fees would be precluded. Since all of
these fees relate to refuse services, the process stated in Proposition 218 does not provide for a formal vote by
the electorate. A separate two-page document explains all of the proposed Garbage Company Rates. A
separate one-page document explains the Minimum Garbage Service Fee.
At th~ Public Hearing on August 1, 2000, the Council can set the rates and impose the fees at any amount up
· to the maximum amount included in the Notice.
Proposal to Provide 64-Gallon Recycling Carts to Dublin Residents
In addition to the garbage rate application process, Staff is requesting that the Council provide direction in
determining whether to provide 64-gallon recycling carts to Dublin residents. In November 1999, the City
received a report by Hilton Famkopf and Hobson, which evaluated the City's progress and strategies to
achieve the 50% AB939 diversion goal. One of the Report's recommendations was to provide large mixed
item recycling containers to Dublin residents, in order to increase diversion. Based on this recommendation,
Council directed Staff to investigate the feasibility of providing 64-gallon recycling carts to Dublin residents.
In response to the City's request, LDD has outlined a proposal for providing the 64-gallon carts.
The current curbside recycling program provides each resident with 3-11 gallon crates to place their recyclable
material at the curb. The new 64-gallon carts would be on wheels, would handle nearly twice the capacity, and
would eliminate the process of separating the materials by the residents. In addition, the carts would improve
the neighborhood appearance by enhancing uniformity and by providing covers to prevent paper and other
material from blowing down City streets during inclement weather. For those who do not have enough space
to store a 64-gallon cart, the Company will provide a 35 gallon cart.
The larger capacity and convenience of the carts will help increase the recycling participation rate and
recycling tonnage in Dublin· For example, in the month of March 2000, Dublin residents recycled a total of
170.58 tons with 6,473 homes, and a participation rate of 57%, for an average of 52.7 pounds per household·
In contrast, in March 2000, the City of San Ramon, which uses the 64-gallon recycling carts, recycled 509.47
tons with 12,177 homes, and a participation rate of 81%, for an average of 83.7 pounds per household. It is
difficult to predict how much Dublin's recycling rate will increase, but it seems clear that additional capacity
and convenience will improve the City's current curbside recycling program.
The cost to provide the carts to Dublin residents is $300,300. LDD has proposed two options for acquiring the
carts. The first proposal is for LDD to purchase the carts, in exchange for an extension to the current Franchise
Agreement. The life of the carts is five years, however as of June 30, 2000 them will only be three years
remaining on the contract· The current Agreement expires on June 30, 2003. The Agreement includes a
provision that grants the City the option of extending the Agreement three times up to a total of thirty-six
months. This option would extend the Agreement to June 30, 2006. In order to recover the capital costs of the
carts, LDD is proposing that the City exercise this option and extend the Agreement through June 30, 2006,
with two one-year extensions through 2008. If the Council wishes to pursue this option, a Franchise
Agreement Amendment is required to change the term of the Agreement.
This option would provide the carts at no additional cost to the City or its residents; however the Franchise
extension would limit Dublin's ability to change any aspect of the Agreement until June 30, 2006· At the
present time, the City has a good relationship with LDD and does not anticipate any problems in the near
future, but extending the term of the Agreement could present a significant obstacle, if garbage and recycling
issues in the City change, and/or if the City becomes dissatisfied with the level of service. Recycling issues
have changed significantly since 1995 and will continue to evolve. By extending the term of the Agreement,
the City postpones any opportUnity to address those issues.
The second option is for the City to purchase the carts using Measure D funds. LDD is willing to purchase the
carts and accept payment(s) from the City totaling $200,000. The City has adequate Measure D fund reserves
to purchase the carts. LDD will make up the difference in cost savings associated with increased efficiency
and reduced workers compensation. This option is appealing because there will be no additional costs to
Dublin residents, and the City's payment will come entirely from the City's Measure D recycling fund. It is
impoi-tant to note that the Measure D fund reserve would be significantly reduced. While none of the current
· programs would be affected, the City would not have Measure D funds available for new projects in the short
term. The Council must determine if this is a program for which it would like to use these funds.
If the Council decides to provide the 64-gallon recycling carts, Staff recommends using the City's Measure D
fund reserve to purchase the carts. Improving the City's residential recycling program by purchasing 64-ga!Ion
recycling carts is a use for which Measure D funds are intended.
Recommendation
Staff recommends that the City Council concur with the establishment of a Public Hearing on August 1, 2000,
adopt the Resolution approving the Franchise' Agreement Amendment regarding the interpretation of Prior
Year Compensation and provide direction to Staff regarding whether the Council would like to provide 64
gallon recycling carts to Dublin residents, and if so, authorize the City Manager to negotiate an
agreement/contract with LDD fo purchase 64 gallon recycling carts using the City's Measure D fund reserve,
for a total not to exceed $200,000.
RESOLUTION NO. -00
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
AUTHORIZING THE MAYOR TO EXECUTE THE FIRST AMENDMENT TO THE FINAL
AGREEMENT BETWEEN THE CITY OF DUBLIN AND WASTE MANAGEMENT OF
ALAMEDA COUNTY FOR INTEGRATED SOLID WASTE MANAGEMENT SERVICES
WHEREAS, the Council has been presented with an agreement entitled FIRST AMENDMENT
TO THE FINAL AGREEMENT BETWEEN THE CITY OF DUBLIN AND WASTE
MANAGEMENT OF ALAMEDA COUNTY FOR INTEGRATED SOLID WASTE
MANAGEMENT SERVICES; and
WHEREAS, the Council is familiar with the terms of the agreement; and
WHEREAS, the City Manager has recommended approval of the agreement.
NOW, THEREFORE BE IT RESOLVED, that the First Amendment to the Final Agreement
Between the City of Dublin and Waste Management of Alameda County for Integrated Solid Waste
Management Services is hereby approved and the Mayor is hereby authorized and directed to execute the
Agreement in substantially the form attached as Exhibit A to the agenda statement.
PASSED, APPROVED AND ADOPTED this 6th day of June 2000, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
MAYOR
CITY CLERK
ATTACHMENT '1
FIRST AMENDMENT TO FINAL AGREEMENT BETWEEN
CITY OF DUBLIN AND WASTE MANAGEMENT OF ALAMEDA COUNTY FOR
INTEGRATED SOLID WASTE MANAGEMENT SERVICES
This First Amendment to the Final Agreement between the City of Dublin and
Waste Management of Alameda County for Integrated Solid Waste Management
Services (hereafter "Agreement") is made by and between the City of Dublin (hereafter
"City"), a municipal corporation of the State of California, and Waste Management of
Alameda County (hereafter "Company"), a corporation organized under the laws of the
State of California, this day of ,2000.
RECITALS
A. The terms of the Agreement, which the parties initially entered into on
June 13, 1995, are hereby incorporated by reference. Any terms used in this
Amendment that are not defined herein, but that are defined in the Agreement, shall
have the meanings respectively ascribed to them in the Agreement.
B. Under the terms of the Agreement, Company provides solid waste
collection and disposal services for City, among other services, for which it receives
compensation. The City sets rates for services provided by the Company. Every year,
Company submits an application for compensation to the City for the following year.
Compensation for each year, as computed, is generally based on the prior year's
compensation, adjusted by, among other things, a factor of the Consumer Price Index.
The rate City charges customers is based on the amount of compensation required.
C. During the course of performance under the Agreement, the parties have,
in different years, agreed to use two different meanings of the prior year's
compensation.
D. The parties now desire to bring greater certainty to the method of
calculating each year's compensation and rates, to account in the Company's
compensation for the rapid growth in the City's population in recent years, and to avoid
a large future increase in the rates that customers are charged.
EXHIBIT A
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises contained herein,
the parties agree as follows:
1. AMENDMENT OF AGREEMENT. The Agreement is hereby amended by
the addition of the following definitions to Article 1 of the Agreement.
Prior Rate Year's Company Collection Compensation
The phrase "prior Rate Year's Company Collection Compensation," as used in section
6.4 and subsection 6.4.1 of this Agreement, means compensation for Collection for the
Rate Year in which Company is calculating Company Compensation, as part of its
regular adjustment application under section 6.6 of this Agreement. It shall be
calculated by multiplying the subscriber rates for that Rate Year by the number of
subscribers (hereafter "Subscriber Census Data"), adding rate subsidy funds provided
bY the City during that Rate Year under "Measure D," and then subtracting both the
prior Rate Year's Company Disposal Compensation and City's calculated Franchise
Fees.
Subscriber Census Data is the sum of:
Residential Subscriber Census Data as reported by the Company as of
December 31 of the Rate Year in which the Company is calculating
Company Collection Compensation;
Commercial Subscriber Census Data as reported by Company for the
month of December of the Rate Year in which the Company is calculating
Company Collection Compensation; and
Drop Box Subscriber Census Data, including handi-haulers, for the
calendar year that ended on December 31 of the Rate Year in which the
Company is calculating Company Collection Compensation.
Prior Rate Year's Company Disposal Compensation
The phrase "prior Rate Year's Company Disposal Compensation," as used in section
6.4 and subsection 6.4.2 of this Agreement, means the sum of (1) the Company's
actual disposal compensation (tonnage multiplied by the Gate Rate) for the first eight
months of the Rate Year in which the Company is calculating Company Compensation,
as part of its regular adjustment application under section 6.6 of this Agreement, and
(2) an estimate of the Company's disposal compensation for the final four months of
that Rate Year.' The estimate shall be (a) one plus the percentage change of the actual
disposal compensation for the' first eight months of the Rate Year in which the
Company is calculating Company Compensation and the actual disposal compensation
for the first eight months of the previous Rate Year, multiplied by (b) the actual disposal
First Amendment to Final Agreement between
City of Dublin and Waste Management of Alameda County for
Integrated Solid Waste Management Services
compensation for the final four months of the previous Rate Year. Either City or
Company may propose an alternate estimation methodology, if either believes that the
methodology described above would result in unreasonable compensation. Use of an
alternate methodology is, however, subject to notice to and approval by City, which
approval City shall not unreasonably withhold.
2. TARGETED REVENUE INCREASE. For each succeeding Rate Year, as
part of calculating Company Compensation and rate adjustments pursuant to Exhibit 9
of the Agreement, City calculates the amount of increased revenue it must generate to
pay the required Company Compensation for that Rate Year, referred to as the
"Targeted Revenue Increase." For the purposes of that calculation only, City shall use
Commercial and Residential Subscriber Census Data as of February 28 of the Rate
Year in which it is performing the calculation. In calculating the Targeted Revenue
Increase, it shall use the same Drop Box Subscriber Census Data as used in the
definition of "prior Rate Year's Company Collection Compensation."
3. NO REQUEST FOR EXTRAORDINARY RATE INCREASE. Company
agrees that it shall not, during the term of the Agreement and any extension, request an
extraordinary increase to rates under section 6.8 of the Agreement for significant
changes in Company's workload due to new residential or commercial development.
4. CONFLICTING TERMS. Wherever the terms of this Amendment and the
terms and conditions of the Agreement conflict, the terms of this Amendment shall be
deemed to supersede the conflicting terms of the Agreement.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date written above.
CITY OF DUBLIN
WASTE MANAGEMENT OF
ALAMEDA COUNTY
By:
-Guy S. Houston, Mayor
Approved as to form:
By:
Its:
Attest:
Elizabeth H. Silver, City Attorney
Kay Keck, City Clerk
First Amendment to Final Agreement between
City of Dublin and Waste Management of Alameda County for
Integrated Solid Waste Management Services
COMPARISON OF SELECTED RATES CURRENT
vs PROPOSED (with $1.00 Altamont Fee)
Residential -Monthly Rates
Minimum Residential (35) Gallon
64 Gallon Residential
% Dublin Customers Covered By
Sample Rate Categories
95%
Proposed Current
Dublin Rate
$ 10.20 $10.05
$ 18.75 $18.05
% Increase
over 1999
1.49%
3.88%
Additional Green Waste Recycling Can: $4.00 per can per month - (no change)
Multi-Family Recycling:
$ 0.57 per unit $ 0.55 per unit
3.64%
Commercial -Monthly Rates
1 Yard- 1 time/wk
2 Yard - 1 time / wk
3 Yard - I time / wk
3 Yard - 2 times / wk
4 Yard - 1 Time / wk
4 Yards - 2 times / wk
% Dublin Customers Covered By
Sample Rate Commercial Categories
$ 34.70 $ 33.45 3.74%
$ 69.40 $ 66.90 3.74%
$ 104.10 $ 100.35 3,74%
$ 216.90 $ 209.15 3.71%
$ 138.80 $ 133.80 3.74%
$ 286.30 $ 276.05 3.71%
74%
Drop Box - Rates Per Service
20 Yard Loose $ 240.00
30 Yard Loose $ 360.00
40 Yard Loose $ 480.00
Represents 91% of 1999 non-compacted Drop Box Subscriptions
$ 228.00
$ 342.00
$ 456.00
5.26%
5.26%
5.26%
30 Yard Compacted $ 720.00
Represents 81% of the 1998 compacted Drop Box Subscriptions
$ 684.00
5.26%
Handy Hauler Available To Residential $ 58.00
$ 56.35
2.93%
ATTACHMENT 2
ATTACHMENT 3
(Prepared By City of Dublin May 2000)
Primed: 06/01/2000 8:53
Residential
1 Can Residential (32-35 Gallon)
2 Can Residential (64-70 Gallon)
# Dublin
2000 Garbage Rate Comparison Survey
Livermore
3 City Proposed
Pleasanton San Ramon Average Dublin
$ 10.58 $ 16.00 $ 11.50 $ 12.69 $ 10.20
$ 19.73 $ 25.50 $ 16.73 $ 20.65 $ 18.75
% Dublin Customers Covered By Sample Rate Categories: 95%
Residential Notes:
% Proposed Current
From Avg Rate
-20% $ 10.05
-9% $ 18.05
Dublin: Basic rate includes 35-gallon can supplied by LDD (weekly pick-up);Weekly 64-gallon green waste can supplied by
LDD; weekly curbside recycling collection; and 3 special curb-side clean-ups per year
Livermore: Basic rate includes a 30-35-gallon can supplied by customer, picked up weekly; 96-gallon green waste can
supplied by LDD (every_ other week pick-up); weekly curbside recycling; and 4 curbside clean-ups per year
San Ramon:Basic rate includes 35-gallon can supplied by Garbage Co. (weekly pick-up); 96-gallon green waste can supplied by Company
(picked up every other week); weekly curbside recycling, and three special clean-ups per year.
Pleasanton: Basic rate includes 35-gallon can supplied by company (weekly pick-up); 64-gallon green waste can
(picked up every_ other week); no separate container for recyclables; 1 extra green-waste pick-up per year; no special curbside clean-ups
3 City Proposed
Commercial Livermore Pleasanton San Ramon Average Dublin
1Yard-ltime/wk $ 41.66 $ 61.27 $ 70.00 $ 57.64 $ 34.70 -40% $ 33.45
2Yard-ltime/wk $ 83.32 $ 122.54 $130.00 $111.95 $ 69.40 -38% $ 66.90
3 Yard - 1 time / wk $124.98 $ 183.81 $180.00 $162.93 $104.10 -36% $100.35
3 Yard- 2 times/wk $267.27 $ 367.62 $360.00 $331.63 $216.90 -35% $209.15
4Yard- 1 Time/wk $166.64 $ 245.08 $220.00 $210.57 $138.80 -34% $133.80
4 Yards- 2 times / wk $350.59 $ 490.16 $440.00 $426.92 $286.30 -33% $276.05
% Dublin Customers Covered By Sample Rate Categories: 74%
Drop Box
20 Yard Loose $ 201.00 $ 282.80 $ 300.00 $ 261.27 $ 240.00 -8% $ 228.00
30 Yard Loose $ 301.50 $ 424.20 $450.00 $ 391.90 $ 360.00 -8% $ 342.00
40 Yard Loose $ 402.00 $ 565.60 $ 600.00 $ 522.53 $ 480.00 -8% $ 456.00
30 Yard Compacted $ 603.00 $ 848.40 $ 900°00 $ 783.80 $ 720.00 -8% $ 684.00
% Dublin Customers Covered By Sample Rate Categories: 90%
Note: Pleasanton is currently conducting a rate review which will adjust the above rates beginning July 1, 2000
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.
Increase
1999
1.49%
3.88%
3.74%
3.74%
3.74%
3.71%
3.74%
3.71%
5.26%
5.26%
5.26%
5.26%
ATTACHMENT 3
CITY OF DUBLIN
PUBLIC NOTICE AND
SUMMARY REGARDING
PROPOSED
ADOPTION OF PROPERTY
RELATED FEES
THIS NOTICE PROVIDES IMPORTANT INFORMATION ABOUT THE FEES BEING PROPOSED
AND THE PUBLIC HEARING PROCESS. FOR SPECIFIC DETAILS ON EACH OF THE FEES
PLEASE REVIEW THE ENCLOSED FEE DESCRIPTIONS.
PLEASE NOTE THESE ARE NOT NEW FEES.
REASON FOR THIS NOTICE
In November of 1996, California voters enacted Proposition 218, a Constitutional Amendment which
changed the process to be used when cities impose certain fees, taxes, and assessments. The new law has
different procedures depending on the type of fee. The information provided with this notice relates
specifically to the City of Dublin adoption of fees related to Refuse Collection Services for Garbage
Collection/Disposal -Recycling Collection. In accordance with Proposition 218 the City has determined
that these fees are considered Property Related Fees and Charges.
WHO SHOULD RECEIVE THE NOTICE?
You are being provided with this notice as the identified owner of real property in the City of Dublin. The
requirements contained in Proposition 218 did not clearly address the distribution of information, to non-
property owners who may have an interest in the cost of services. For example, in some cases commercial
garbage services may actually be paid by tenants; if necessary please forward this information.
WHAT FEES ARE BEING CONSIDERED?
The following chart summarizes the fees applicable to this Notice. Also, enclosed you will find separate
sheets describing the amount of the fees/charges and additional details.
Name of Fee Who It Affects How It Is Collected Basic Purpose Approximate Rate
Change
Garbage Garbage Service Collected by the Collection and Disposal of Increase in rates
Company affects all Parcels; company authorized Solid Waste and Provision of varies depending on
Rates and Recycling to perform the Residential Recycling Service service.
Service Rates apply services - Livermore
to Residential Dublin Disposal
Parcels only (LDD)
Residential All Residential Collected With Weekly Collection and Basic service will
Minimum Units Not Serviced Property Tax Disposal of: (1) 35 gal. increase from
Garbage / By Central Bill.(Any additional garbage container;(1) 64 $120.60 per year to
Recycling Dumpster Bins Services are billed gallon Green Waste Container; $122.40 per year. A
Services and collected by Curbside Recycling; and 3 total annual increase
LDD) Special Clean-ups. of $1.80 per year.
ATTACHMENT 4
WHEN WILL THE CITY COUNCIL ADOPT THE FEES? (PUBLIC HEARING DATE & TIME)
The City Council will consider the adoption of the proposed fees at a Public Hearing on:
Tuesday August 1, 2000
7:00 p.m. - City Council Chambers
100 Civic Plaza Dublin, California 94568
WHEN WILL THE NEW FEES BE EFFECTIVE?
The fees will be effective beginning July 1, 2000, and will continue from year to year. For those fees
collected with your Property Tax bill, the amount will be included in the bills which are typically paid in
two equal payments in December and April.
HOW DO DUBLIN RATES COMPARE TO THOSE OF SURROUNDING COMMUNITIES?
Even with the proposed rate increase, Dublin's rates are all less than the average of rates from Pleasanton,
San Ramon and Livermore. The attached rate survey provides more details on residential and commercial
rates for these communities.
IS THERE AN OPPORTUNITY FOR PUBLIC COMMENT?
YES. The Public Hearing noted above is a public meeting and there will be an opportunity for testimony
and public input.
PLEASE NOTE: Proposition 218 requires that the City count the number of written protests against the
fee. If you wish to file a written protest you must include the following information: 1) Identify the fee
you are protesting; 2) Provide your printed name and complete address; 3) Indicate the address of your
property, if it is different from your address; (4) IMPORTANT - Include the Assessor's Parcel Number
(See Address Label On This Notice); and 5) Provide your signature and the date signed. You may mail
your written protest in advance of the Public Hearing to: Attention City Clerk, City of Dublin, Post
Office Box 2340 Dublin, California 94568. In order to be counted, all of the information discussed above
must be included.
CAN FEES COLLECTED ON PROPERTY TAXES BE USED FOR ANY PURPOSE?
No. The fees collected by the City must be used for the purposes of the identified programs. This has
always been the policy of the City and Proposition 218 also included this requirement in the State
Constitution. The fees collected with the property tax bill are accounted for by the City in separate
accounts, to assure that they are only used for authorized expenditures. Interest revenue is also collected
on the investment of the idle funds. This helps to reduce the amount which must be collected as part of
the Property Tax Bill. In the event that any funds remain at the end of the year, they are carried over to
reduce the cost of the program in the following year. Each year the City obtains an independent audit of
the financial records for all funds collected and expended by the City.
QUESTIONS?
It is our hope that the information included with this Notice is helpful in answering the most common
questions. In the event that you have additional questions, please contact the appropriate number shown
below:
Garbage and Recycling Fees and Charges -City Manager's Office (925) 833-6650
PROPOSED ADJUSTMENT TO GARBAGE COMPANY RATES
Affected Parcels
Chapter 5.32 of the Dublin Municipal Code requires for the protection of the health safety and welfare of the community
that all parcels obtain minimum weekly garbage service. Livermore Dublin Disposal is the authorized garbage collection
and disposal firm operating within the City. The agreement between the City of Dublin and Livermore Dublin Disposal
provides that the City shall adopt a rate schedule which is estimated to allow the Company to achieve a fixed amount of
annual revenue. Therefore, the adoption of these fees will affect all parcel owners. The rates indicated on this notice
represent the maximum amount that the City can establish at the August 1, 2000 Public Hearing. Rates are effective July
1, 2000.
Basis of Fees
The City has negotiated a multi-year agreement with Livermore Dublin Disposal. The Company may request a change in
rates based upon a formula which includes: changes in the Consumer Price Index; Increased Regulatory Fees; and
changes in the total tons delivered 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.
RESIDENTIAL RATES
Company Minimum Residential Collection Rate: Applies separately to each single family unit as well as each unit
within a duplex or other attached housing, which receives individual garbage collection services. The rate applies to the
initial 35 gallons of garbage capacity, including once per week collectiOn and disposal; 3 annual special curbside clean-
ups; Weekly Curbside Residential Recycling; and Weekly Curbside Green Waste Recycling (64 gallon container). All
containers are provided by the Company (Note: For Housing Units Constructed as of the 2000/2001 Property
Tax Lien Date, January 1, 2000, the annual cost of Minimum Service will be paid through a fee collected
with the Property Tax bill. See Insert )
Company Minimum Monthly Rate:
$10.20
Residents may select a larger garbage container for an additional fee which is shown below:
64 Gallon Garbage Container: Minimum Cost Plus $ 8.55 per month (Total = $18.75 per month)
96 Gallon Garbage Container: Minimum Cost Plus $17.10 per month (Total = $27.30 per month)
Each Additional Increment shall be an additional $8.50 per month.
Special Residential Services
Large Accumulations: $12.00 per cubic Yard
Special Pick-Ups: $12.80 minimum per pick-up
Additional Green Waste Container: $4.00 per container
COMMERCIAL AND MULTI-FAMILY BIN SERVICES (FRONT-END LOADER)
Excess Rate For Waste Which Exceeds water level: $12.00 per cubic yard
Commercial Can Service: Offered at locations unable to accommodate a commercial bin or with volumes deemed
insufficient to utilize a commercial bin. Monthly rate includes bin rental and once per week collection and disposal.
35 Gallon Container: $ 8.90
64 Gallon Container: $16.20
96 Gallon Container: $ 24.20
Multi-Family Recycling Service: Multi-Family rates for Recycling are charged by the Company on the number of
units located in the complex.
.Monthly Cost: $ 0.57 per unit
Commercial Bin Service Rates
Rates shown below are monthly rates based upon bin size and frequency of service.
and bin rental.
Size # # Times Base Monthly Size #
YARDS Per Wk Rate YARDS
1 1 $34.70 4
1 2 $78.10 4
1 3 $121.50 4
1 4 $164.90 4
1 5 $208.3 4
Rates include collection, disposal,
# Times Base Monthly
Per Wk Rate
1 $138.80
2 $286.30
3 $433.80
4 $581.30
5 $728.80
2 1 $69.40 6
2 2 $147.50 6
2 3 $225.60 6
2 4 $303.70 6
2 5 $381.80 6
1 $208.20
2 $425.10
3 $642.00
4 $858.90
5 $1,075.80
3 1
3 2
3 3
3 4
3 5
$104.10 7 1 $242.90
$216.90 7 2 $44.50
$329.70 7 3 $746.10
$442.50 7 4 $997.70
$555.30 7 5 $1,249.30
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: $58.00
Additional Bin Rental Per Week: $10.70 per week Cost For Additional Dump: $44.00 / pick-up
Excess Per Yard If Filled Above Water Level $12.00 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. Additional Miscellaneous
charges may also apply. Excess Rate Per Cubic Yard: Non-Compacted: $12.00 Compacted: $24.00
MISCELLANEOUS DROP BOX CHARGES
Drop Box Flasher
$12.75 per placement
Initial Placement of Drop Box
$25.00
Stand-By Time I
$85.10 per hr.
Relocation of Drop Box
$38.10 per request
Weekly Drop Box Container Rental
After 1 st Week
$14.90 Per Week
Cancel Auto Pick-Up
Without Notice
$48.00
City of Dublin
RESIDENTIAL MINIMUM GARBAGE / RECYCLING SERVICES
(Collected With Residential Property Tax Bills)
Affected Parcels
Residential housing units are billed for the cost of Minimum Garbage/Recycling Services, 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. Livermore Dublin Disposal will continue to bill customers each quarter for additional services,
if a household selects weekly garbage collection of a container larger than the 35 gallon container
included in the Minimum Service Level.
Basis of The Fee
The City estimates the total revenue required to pay the Garbage Company for Minimum Service to all
residential units which are eligible to use the service. The specific factors considered in this calculation
include the following components: the monthly residential rate for Minimum Service (Proposed at $10.20
per month); 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.
What Services Are Provided By The Fee
Minimum Service includes: weekly collection and disposal of one (35 Gallon) garbage container; weekly
collection of one (64 Gallon) Green Waste container; weekly curbside recycling (including: glass, tin,
aluminum, newspaper, mixed paper/junk mail, magazines, and cardboard); and three special clean-ups
each year. All monies collected will only be used towards the cost of these services.
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 Livermore Dublin Disposal based upon the current rate
allowed for Minimum Residential service. The fees below represent the maximum amount the Council
can impose for the 2000-2001 Minimum Residential Service.
TYPE OF HOUSING UNIT
Each Single Family Residence
Each Condominium / Townhouse Unit
Each Duplex (2 Units)
Each Duplex (3 or More Units)
ANNUAL FEE
$122.40
$122.40
$ 244.80
$122.40 times the
number of units
Metropolitan Area Index (Urban Wage Earners; 1982-84 = 100)" belween the index
published for February 1997 and the corresponding index published t~velve (12) months
earlier plus the then current Fee Component multiplied by one-half of the annual tons,
as shown on Exhibit 8.
6.3.3 City Fees Calculation
City Fees shall be calculated by dividing the sum of Company' Collection
Compensation and Company Disposal Compensation by one (1) minus the sum of the
Franchise Fee, SRR fee, Administrative Fee, and other City fee percentages then in effect
in accordance with Article 3, and subtracting from the result the sum of Company
Collection Compensation and Company Disposal Compensation, as shown below
(numbers are used for example only).
City Fees = (Company Collection Compensation & Company Disposal Compensation)
1 - CFranchise Fee + SRR Fee + Administrative Fee)
- (Company Collection Compensation + Company Disposal Compensation
= ($2,000,000 + $500,000). - ($2,000,000 + $500,000)
(1-.1s)
= $441,176
6.4
Company Compensation for Subsequent Rate Years
Company Compensation for each succeeding year, be~nning with the Third Rate Year
ending ~une 30, 1999, shall be calculated by adjusting Company's prior Rate Year
Collection Compensation, including Residential Collection, Commercial and Industrial
Collection, Residential Recycling Collection, processing, and marketing, and
administrative services, by eighty percent (80%) of the change in the San Frandsco-
Oakland Metropolitan Area Index (Urban Wage Earners; 1982-84 = 100) between
February of the then current calendar year and the corresponding index published
twelve months earlier and by adjusting Company's prior Rate Year Base Rate by one-
hundred percent (100%) of the change in the San Francisco-Oakland Metropolitan Area
Index (Urban Wage Earners; 1982-84 = 100) between February of the then current
calendar year and the corresponding index published twelve months earlier, as
described below.
-50- ATTACHMENT 5
6.4.1 Company Collection Compensation
For each succeeding year, begirming with the Third Rate Year (i.e., from ~uly 1, 1998, to
June 30, 1999), Company Collection Compensation shall be calculated by multiplying
the prior Rate Year's Collection Compensation, by one (1) plus eighty percent (80%) of
the percentage change in the "San Francisco-Oakland l~4etropolitan Area Index [Urban
Wage Earners; 1982-84 = 100)" between the index published for February of the then
current calendar year and the correspondir~g index published twelve (12) months earlier
6.4.2 Company Disposal Compensation
For each year, be~nning with the Third Rate Year (i.e., from July 1, 1998, to Sune 30,
1999), Company Disposal Compensation shall be calculated by multiplying the prior
Rate Year's Disposal Compensation by one (1) plus the percentage change in the Gate
Rate. The percentage change in the Gate Rate shah be calculated by subtracting the
Gate Rate for the prior Rate Year from the Gate Rate for the Rate Year and dividing the
result by the Gate Rate for the prior Rate Year. The Gate Rate for the Rate Year shall be
calculated by adjusting the Base Rate for the prior Rate Year by one-hundred percent of
the change in the San Francisco-Oakland Metropolitan Area Index (Urban Wage
Earners; 1982-84 = 100) between February of the then current calendar year and the
corresponding index published twelve months earlier, and adding the result to the Fee
Component for the Rate Year.
6.5
Company Compensation for the Extension Period
Company Compensation for each of the Rate Years during the extension period, if any,
shah be calculated in the same manner as Section 6.4.
6.6
Application for Adjustment
Company shah calculate and submit to City annually by April 1 of each year Company
Compensation as described in Sections 6.3 and 6.4. Company shall further calculate the
annual percentage rate adjustment, including the effect on City Franchise, Source
Reduction and Recycling and Administrative Fees, resulting from the calculation of
Company's Compensation. Subject to Section 6.8, in no event shah the annual
compensation adjustment exceed five percent (5%). Exhibit 9 contains an example of
the Company Compensation and annual rate adjustment calculation.
City shah calculate those rates that it deems appropriate so long as the revenues
forecasted to be received by Company from charging such rates can reasonably be
-51- ~une 30, 1995
expected to generate sufficient revenues to provide Company Compensation as
calculated by the Company.
City shall not make any retroactive adjustments to rates to compensate for any delay in
calculating Company Compensation which results in whole or in part from the failure
of Company to submit its request by April 1 and/or respond promptly and completely
to requests of City for information related to any of the calculations required by this
Section or from appeals of the determination to City which extends the process of
determination.
6.7
Variances from Projections.
Company shall retain any income from actual costs being less than calculated in
accordance with Sections 6.2 through 6.5 but shah not be compensated for ~ctual costs
being more than calculated. In addition, calculations of Company' Compensation shall
not be adjusted for past variances of actual cost from those projected.
Further, Company shall retain any income from actual revenue being more than
projected but shall not be compensated for actual revenue being less than projected.
6.8
Extraordinary Adj us tments
Company or City may request an adjustment to rates at reasonable times other than that
required in Section 6.6 for unusual changes in the cost of providing service under this
Agreement. Such changes may include, but are not limited to, changes in laws,
ordinances or regulations, s~gzdficant changes in Company's workload due to new
residential or commerdal development, s~gniticant changes in the mix of Waste
Generator servi~e subscriptions, and changes in the Disposal Site requested by City.
Such changes shall not include changes in the market value of Recydable Materials
from the values assumed in Company's proposal. However, when an extraordinary
adjustment is requested, such adjustment shall consider changes in all costs and
revenues from Company's Proposal. For each such request, Company shaiI prepare a
schedule comparing the original proposal costs and revenues by line item to the then
current costs and revenues, including an estimate of the cost impact of the change, using
an operating ratio of 91.5%, applied to Company's costs as calculated in Company's
Proposal. Such request shall be prepared in a form acceptable to City with support for
assumptions made by Company in preparing the estimate. Company and City shall
negotiate a mutually acceptable adjustment amount.
-52- June 30,1995