HomeMy WebLinkAbout02 ASSESS. SOLID WASTE 07-15-02AGENDA REPORT
MEETING DATE: July 15, 2002
I
830-50
NO. 02
07'-15-02
TO:
WILLIAM A. HUSTON, CITY MANAGER
FROM:
PUBLIC WORKS DEPARTMENT
SUBJECT:
RESOLUTION NO. 02-65 PLACING ASSESSMENTS FOR SOLID
WASTE COLLECTION ON THE 2002-2003 TAX ROLL
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SUMMARY
In accordance with the current Franchise Agreement, Federal Disposal Service has
requested approval of rate adjustments for all customers pursuant to an increase in the
Producer Price Index and an additional extraordinary increase in commercial rates.
Staff concurs with and recommends approval of the request for the specific Producer
Price Index adjustments for residential and commercial rates. Staff recommends denial
of the extraordinary rate adjustments for commercial rates as unwarranted.
RECOMMENDATION
Adopt Resolution No. 02-65 placing assessments for solid
residential units only on the Tax Roll for fiscal year 2002-2003.
waste collection for
FISCAL IMPACT
Commercial customers only pay a 2% Franchise Fee.
increase franchise fees paid to the City.
Increased commercial rates will
BACKGROUND
Pursuant to the Franchise Agreement for Integrated Waste Management Services,
Federal Disposal Service (FDS) has requested City approval of residential and
commercial rate adjustments (See attached Exhibit A). The franchise agreement
permits a rate adjustment commencing with the third year of the Franchise Agreement
and would become effective October 1, 2002.
Only single family residential collections up to three units and commercial can collection
costs are placed on the tax rolls. Commercial bin and roll off services are billed directly
by Federal Disposal Service. All rates are governed by the existing franchise
agreement and are adjusted annually using the same factors.
The change in the Producer Price Index (PPI) during the 2001 calendar year is the
primary basis of the rate increase computation. The Producer Price Index is a family of
indexes that measures the average change over time in the selling prices received by
domestic producers of goods and services. PPI indices measure price changes from
the perspective of the seller. This contrasts with other measures, such as the
Consumer Price Index (CPI), that measures price change from the purchaser's
perspective. Sellers' and purchasers' prices may differ due to government subsidies,
sales and excise taxes, and distribution costs.
Over 10,000 PPI indices for individual products and groups of products are released
each month. PPI indices are available for the products of virtually every industry in the
mining and manufacturing sectors of the U.S. economy. New PPI indices are gradually
being introduced for the products of industries in the transportation, utilities, trade,
finance, and services sectors of the economy. PPI data are commonly used in
escalating purchase and sales contracts.
Pursuant to the Franchise Agreement, the PPI is applied only to hauler service costs
(labor, materials, fuel, etc.) and not to disposal costs. Disposal costs are fixed at $22
per ton by the Orange County Solid Waste Flow Control Agreement. This approach
results in a weighted application of the rate increase. The table below demonstrates the
application of Producer Price Index utilized by FDS:
PPI 12-31-00 PPI 12-31-01 Change % Change
124.2' 129.5 +5.3 +4.3%
As identified in Exhibit A, the calculated residential rate for 2002-2003 is an increase of
$.42 per month, $5.04 for the year, from the existing rates, the proposed weighted rate
adjustment represents a 3.4% increase over the existing rates. The following table
details the proposed changes to the residential rates for 1999-2000:
Adjusted
Current Weighted Adjustment Monthly
Service Monthly Adjustment
Rate Rate
Single Family $12.17 3.4% $0.42 $12.59
Automated Cart
Manual Can Collection $7.34 3.4% $0.25 $7.59
Utilizing the same weighted methodology, commercial and would be increased by 2.7%.
Roll off Rates would be increased by the full 4.3% because disposal costs are paid
directly by the customer. The recommended commercial rates are attached as part of
Exhibit B.
In addition to the PPI adjustment, FDS has requested an extraordinary rate adjustment
of $367,152 to compensate for expenses which it says were unanticipated when the
contract bids were submitted in early 2000. This represents an 8.7% increase over the
original bid submitted by FDS in 2000. The extraordinary request is for labor costs for
various residential services that FDS says feels are not covered by the Franchise
Agreement and additional costs associated with a future union labor contract.
FDS has utilized a methodology which will allocate all of these extraordinary costs to
commercial rates. No explanation has been provided for the use of this methodology
and it is not consistent with the methodology specified in the Franchise Agreement. The
extraordinary rate adjustments would increase commercial rates by 17%.
FDS identified three residential services which it believes could not have been
anticipated prior to the bid and represent extraordinary costs:
1) Pickups for residents that do not set out cans on time and demand
collection.
2) Picking up extra waste set along side carts as required.
3) Providing unmerited additional carts to customers on occasions when they
insist.
The requested extraordinary increases have been reviewed by staff and the City
Attorney and it has been determined that they are not consistent with the Integrated
Solid Waste Management Services Franchise Agreement for the following reasons:
1) Call-backs for residents that put out their refuse containers late is a normal
occurrence in residential refuse collection and should have been
considered in the Company's bid.
2) The collection of extra waste "as required" should have been factored into
the Company's bid. In Section 5.3.1 Education and Public Awareness -
General, the Agreement provides for a "corrective Action Notice" for use
when the customer sets out inappropriate materials. If the Company used
"Corrective Action Notices", the instances of extra waste being set out
would have been minimized and the Company's increased operating costs
mitigated.
3) The method of compensating the Company for providing additional carts is
addressed in the Franchise Agreement. If a customer requires an extra
refuse cart, the Company can charge $4.00 per month in accordance with
Section 4.1.2 Single Family Dwelling Unit Refuse Collection - Automated
Can Service. Recyclables carts and green waste carts are to be provided
at no additional charge in accordance with Section 4.2.1 Single Family
Dwelling Unit Recycling and Single Family Dwelling Unit Yard Waste
Collection. The Company has therefore already agreed to provide carts
under these conditions, and should have considered such costs in its bid
4) FDS has not identified the frequency or specific operational or economic
impact s of the issues identified above.
FDS has also requested an extraordinary adjustment to commercial rates related to the
anticipated costs associated with a pending labor agreement. Currently, the FDS labor
force is not a unionized and the Company's bid reflects that fact. However, since the
union work stoppage occurred in the fall of 2001, FDS' workers were approached about
unionizing. They elected to do so and FDS agreed to enter into labor negotiations.
Those negotiations have not been concluded and FDS continues to operate as a non-
union shop. FDS is proposing a commercial rate increase in anticipation of the eventual
approval of a labor agreement.
Staff believes that this increase in unwarranted at this time for the following reasons:
1)
2)
The union contract is not approved.
The specific hourly labor rate associated with the contract has not
been adequately identified.
3)
4)
5)
The justification for an additional person has not been adequately
justified in the submitted documentation.
Allocation of all of the labor contract costs to commercial customers is
not equitable as the union contract would apply to all collection route
drivers nor is this allocation method supported by the Franchise
Agreement.
The PPI adjustment method identified in the Franchise Agreement
already compensates FDS for labor costs increases.
In conclusion, staff recommends that the City Council adopt the PPI adjustments for all
residential, commercial and roll off rates, deny approval of any extraordinary adjustment
related to residential services and defer action on an extraordinary increase related to
the anticipated labor agreement until such time that the agreement is finalized and costs
are more specifically identified.
Director of Public Works/City Engineer
J
Public Works Department
Exhibit A
Exhibit B
Exhibit C
FDS Rate adjustment proposal and additional information
Staff recommended rate adjustment
Solid Waste Rate Survey
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RESOLUTION NO. 02-65
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN,
CALIFORNIA ADOPTED PURSUANT TO THE PROVISIONS OF
SECTION 5473 ET SEQ. OF THE HEALTH AND SAFETY CODE OF
THE STATE OF CALIFORNIA, APPROVING AND ADOPTING A
REPORT RELATIVE TO PARCELS OF REAL PROPERTY RECEIVING
.SOLID WASTE COLLECTION SERVICES, DETERMINING THE
CHARGES FOR SOLID WASTE COLLECTION TO BE ASSESSED
AGAINST THE RESPECTIVE LOTS OR PARCELS OF LAND AS THEY
APPEAR ON THE CURRENT ASSESSMENT ROLL
The City Council of the City of Tustin does hereby resolve as follows:
I. That proceedings were duly instituted, conducted and completed pursuant to
provisions of Section 5473 et seq. of the Health and Safety Code of the State of
California.
A. A written report dated July, 2002, containing a description of each parcel
of real property receiving solid waste collection services and facilities and the
amount of the charge proposed to be levied upon each parcel for the collection of
solid waste for the fiscal year 20~_02-2003 was prepared and filed with the City
Clerk of the City of Tustin on
B. That a Public Hearing to hear and consider all objections or protests, if
any, to the aforesaid report and proposed charges was duly set for July 15, 2002
at 7:00 o'clock p.m. in the Council Chamber of the City of Tustin at 300
Centennial Way, Tustin, California.
C. Said hearing was duly noticed as required by law, by publication once
each week for two successive weeks on July 4, 2002 and July 11, 2002 in the
Tustin News, a newspaper of general circulation in the City of Tustin.
D. At the foresaid time and place the duly noticed hearing was held and all
persons who were present were heard and all comments, objections, and
protests to the aforesaid report and proposed charges were duly heard and
considered by the City Council.
E. The charges proposed in the aforesaid report are fair and reasonable, are
commensurate with the services provided, and the charge therefore should
properly be collected on the tax roll in the same manner, by the same persons
and at the same time as, together with and not separately from, general taxes.
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Resolution No. 02-65
Page 2
II. The City Council hereby elects to have the charges set forth in the aforesaid
report collected on the tax roll in the same manner, by the same persons, at the same
time as, and together with and not separately from its general taxes, and hereby
authorizes that such charges be collected on the tax roll, as all prescribed to the
provisions of Health and Safety Code Section 5473 et seq.
III. The Resolution shall be effective following its adoption by a two-thirds vote of the
members of the City Council and shall remain in force and effect and said charges shall
be collected in the manner as foresaid for the year 2002-2003 and for each subsequent
year as authorized by the hereinabove referenced section of the Health and Safety
Code.
IV. The City Clerk is authorized and directed to forthwith file a certified copy of this
Resolution with the Auditor of the County of Orange, together with a copy of the
hereinabove described report, and a statement endorsed thereon over her signature
that the said report has been finally adopted by the City Council of the City of Tustin.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Tustin, California, held on the 15th day of July, 2002.
Jeffery M. Thomas, Mayor
ATTEST:
City Clerk
EXHIBIT A
FEDERAL DISPOSAL SERVICE RATE ADJUSTMENT PROPOSAL
AND
ADDITIONAL INFORMATION
FEDERAL
DISPOSAL
SERVICEJ
Corporate Office: 1661 East Palm Street · Santa Aha, CA 92701
Mailing Address: PO BOX 118., Santa Ana, CA 92702
Telephone: 714-542-7701. Fax: 714-542-8435
May 14, 2002
Mr. Joe Meyers
Administrative Service Manager
Public Works Department
City of Tustin
300 Centennial Way
Tustin, California 92780
RE: Integrated Solid Waste Management Services Franchise
Annual Rate Adjustment
Dear Mr. Meyers,
On June 5, 2000 the City of Tustin and Federal Disposal Service entered into an
Agreement for Integrated Solid Waste Management Services that allows for annual
rate adjustments beginning on the third anniversary of the commencement date. In
accordance with Article 6 this company hereby makes request for a rate adjustment
pursuant to:
· Article 6.4 ...........Producer Price Index
· Article 6.5 ...........Extraordinary Adjustments
It is our goal to provide you herein the documentation that the City may need to
review this request. If the City would like additional documentation or detail, we
ask that you please inform us of this. We appreciate your time and consideration of
this matter. We also look forward to the opportunity to meet with you and to answer
any questions.
Dg~_ ~(dbin
President
C. Mr. Tim Serlet, Public Works Director Ms. Lois Jeffrey, City Attorney
Ms. Chris Shingleton, Assitant City Manager
Attachment: Rate Adjustment Request
INTRODUCTION
On June 5, 2000, the City of Tustin and Federal Disposal Service entered into an
agreement that provides for Integrated Solid Waste Management Services in the City of
Tustin. Federal Disposal Service performs responsibilities and duties described in the
Agreement in consideration of the right to receive compensation pursuant to maximum
rates set by the City. Rates of the Agreement may be adjusted from time to time in
accordance with Article 6 of the Agreement.
Initial rates of the Agreement (two years) were established by the price offer submitted
on January 18, 2000. Article 6.3 of the Franchise Agreement requires this Company to
submit its request for annual adjustment, in writing, at least (90) days prior to the start of
each new Rate Year.
Method of Adjustments
Generally, rates adjustments are allowed by either of the two of the following methods:
· Producer Price Index (PPI). Maximum rates for Single Family Residential,
Commercial Bin Customers, and Industrial Roll off Customers are adjusted
based on the PPI increase. Additionally, landfill rate increases or decreases are
allowed adjustment under this section. (Article 6.4)
· Extraordinary Adjustments. The Company or the City may request an
adjustment to rates at reasonable times for unusual changes in the cost of
providing services under the Agreement, (with some exclusions). (Article 6.5)
Documentation
Article 6.6 of the Franchise Agreement requires that supporting information be provided
with a request for a rate adjustment. Included herein is documentation that we
contemplate the City would need to review and approve a rate adjustment request.
Further detail and supporting information is available upon request.
PRODUCER PRICE INDEX (PPI)
Under Article 6.4 of the Franchise Agreement, adjustments shall be made for changes in
the Producer Price Index weighted with any changes in the refuse disposal gate fee.
Rates adjustment for Single Family, Commercial, and Roll Off are hereby submitted in
accordance with step-by-step procedures and examples listed in Exhibits 5A, 5B, and 5C,
of the Agreement.
EXTRAORDINARY COST INCREASES
Article 6.1 of the Franchise Agreement lists that cost proposed under the original price
offer are only costs that are "reasonably anticipated .... at the "times prescribed". It reads:
6.1 General
The Company Compensation provided for in this Article shall be the full, entire
and complete compensation due to the Company pursuant to the Agreement for
all labor, equipment, materials and supplies, taxes, insurance, bonds, overhead,
Disposal, transfer, profit an all other things necessary to perform all the services
required and reasonable anticipated by this Agreement in the manner and at the
times prescribed.
Article 6.5 of the Franchise Agreement provides an explanative and conditions for a rate
adjustment for extraordinary or unusual costs. It reads:
6.5 Extraordinary Adjustments
The Company or the City may request an adjustment to rates at reasonable times
other than that required in Section 6.3 for unusual changes in the cost of providing
service under this Agreement. Such changes may include changes in components
of the Gate Rate, changes in the Disposal Site requested by the City, and changes
in State or local government solid waste fees and charges. Such changes shall not
include changes in the market value of Recyclables form the values assumed in
the Company's Bid, or inaccurate estimates by the Company of its proposed cost
of operations. For each such request, the company shall prepare a schedule
documenting the extraordinary costs. Such request shall be prepared in a form
acceptable to the City with support for assumptions made by the Company in
preparing the estimate. The City shall review the Company's request and, in the
City's sole judgment, make the final determination on the appropriate amount of
the adjustment if any.
Labor Cost Increase
In 2001 the County of Orange experienced a broad based labor movement that saw the
organization of a number of non-union companies and higher demands for pay and
benefits. The Unions efforts culminated with a municipal strike in October 2001. While
demands for $16.00 an hour were not achieved by the Union, the industry conceded
significant hourly rate and benefit increases. Additionally the Industry conceded annual
pay increases of approximately $1.00 per hour for the next five years.
Federal Disposal Service, a non-union company avoided the strike but succumbed to
organization under Teamsters Local 396. On November 6, 2001, upon advise of legal
council Federal Disposal Service officially recognized the Union as the bargaining agent
for drivers, helpers and mechanics. As of the date of this submission, Federal Disposal
Service is bargaining with the Union and expects an agreement roughly similar with
respect to terms and conditions as countywide agreements. This request for rate
adjustment fbr extraordinary increases in labor is based on the standard countywide union
agreement. To maintain the current level of service, Federal Disposal Service desires to
be able to continue to recruit and hire employees at prevailing industry rates.
Relating to reduce labor costs of the 3-Cart Automated System performed at Single
Family Residents, Federal Disposal Service has proposed this labor cost increase directly
into the manual Commercial Bin services. This 2001 rate increase does not include costs
for future annual pay increases of $1.00 per hour. We request that scheduled annual labor
cost increases that result from the Union Agreement be passed on when they take effect.
Included in this submittal are copies of newspaper articles, union fliers, and other
relevant detail.
Federal Disposal Service
EXHIBIT 5A
(Proposed) Rate Adjustment - Customer Billed By the City on Tax Roll
Step One: Determine disposal expense and service revenue as a percent of actual rate revenue
Revenue Component
Single Family Rate Revenue
Less: Single Family Refuse Disposal Expense
Less: Single Family Equipment Depreciation
Single Family Service Revenue
Group (3)
Tonnage Report
Deprec. Schedule
Annual Amount (a) Percent of Rate Revenue
$ 1,401,735
$ 273,372
$ 216,471
100.0%
19.5%
15.4%
$ 1,128,363 65.1%
Step Two: Calculate percentage change in adjustment factors
Old New Percent Change
Adjustment Factor
Disposal Gate Fee per Ton
Producer Price Index
$ 22.00
124.2
22.00 I O.0%J
129.5 4.3%oj
Step Three: Calculate weighted percentage change in single family rates
J Components of Actual Revenue
Refuse Disposal
Service and Depreciation
Total
Component Weight (b)
19.5%
80.5%
100.0%
Step Four: Apply weighted percentage change to single family rates
Service
Single Family-Automated Cart
Manual Can
Current Monthly Rate (d)
$ 12.17
$ 7.~
Percent Change (C)o.0%Jj Weighted Rate Adjustment
0.0%
4.3%J 3.4%
N/AI 3.4%
Weighted Rate Adjustment Adjusted Monthly Rate
(e)
3.4%
3.4%
$12.59
$7.59
(a) For the twelve months ending on the date six months prior to the effective date of the rate adjustment. For example, for the a rate
adjustment effective July 1, 2002 the revenue used should be for the twelve months ending December 31, 2001
(b) From percent of revenue in Step One
(c) From percent change in Step Two
(d) The weighted rate adjustment applied to the total rate, including franchise fee portion of the rate
(e) From weighted rate adjustment in Step Three
CC: H:\FDS users\ed\Rate adjustment formula 7
Federal Disposal Service
EXHIBIT 5B (Plan 1, wlPPI)
(Proposed) Rate Adjustment - Customer Billed By the Company (Except Rolloff)
Step One Deduct franchise fees from gross rate revenue
Revenue Component (including Franchise Fees)
Actual Gross Commercial and MFR Rate Revenue Groups (1,2,5 & 98)
Actual Commercial and MFR Franchise Fees Quarterly Reports
Actual Gross Commercial and MFR Rate Revenue Net of Franchise Fees
Annual Amount (a)
$ 2,384,865
$ 6O,564
$ 2,324,301
Percent of Rate Revenue I
Includin~l Franchise Fees I
lOO.O%j
2.5%J
97.5%1
Step Two: Determine disposal expense and serwce revenue percentage of total actual rate revenue
Revenue Component (net of Franchise Fees)
Actual Commercial and MFR Bin revenue Net of Franchise Fees (b)
Less: Actual Commercial and MFR Bin Refuse
Actua Commercial and MFR Bin Service Revenue
Groups (1,2, & 5 & 98)
Tonnage Report
Annual Amount (a)
Percent of Rate Revenue
Net of Franchise Fees
$ 2,324,301 100.0%:
$ 873,334 37.6%
$ 1,450,967 I 62.4%
Step Three: Calculated percentage change ~n adjustment factors
Adiustment Factor
Disposal Gate Fee per Ton
Producer Pr ce ndex
Old
22.00
124.20
New I Percent Chan~le
22.00I 0.0%
129.50 4.3%
Step Four Calculated weight percentage change in commercial and MFR B~n rates
Components of Actual Revenue
Refuse Disposal
IService
ITotal
component Weight (c)
37.6%
62.4%
100.0%
I Wei~lhted Rate Adjustment I
Percent Chan~le (d)n.0%v
O.0%J
4.3%J 2.7%J
N/AJ 2.7%J
Step Five: Apphed weighted percentage change to commercial and MFR B~n rates
Service
I ea. 2 yard Bin once per week
I ea. 2 yard Bin twice per week
I ea. 2 yard Bin three times per week
1 ea. 2 yard Bin four times per week
1 ea. 2 yard Bin five times per week
1 ea. 2 yard Bin six times per week
1 ea. 3 yard Bin once per week
1 ea. 3 yard Bin twice per week
1 ea. 3 yard Bin three times per week
1 ea. 3 yard Bin four times per week
1 ea. 3 yard Bin five times per week
1 ea. 3 yard Bin six times per week
1 ea. 4 yard Bin once per week
1 ea. 4 yard Bin twice per week
1 ea. 4 yard Bin three times per week
1 ea. 4 yard Bin four times per week
1 ea. 4 yard Bin five times per week
1 ea. 4 yard Bin six times per week
Current Monthly Rate
(e)
$ 35.53
$ 63.51
$ 91.50
$ 119.48
$ 147.47
$ 175.45
$ 39.95
$ 72.35
$ 104.76
$ 137.16
$ 169.56
$ 201.96
$ 44.37
$ 81.19
$ 118.01
$ 154.83
$ 191.65
$ 228.48
Weighted Rate
Adjustment (f)
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
(a) For the twelve months ending on the date six months prior to the effective date of the rate adjustment. For example, for
adjustment effective July 1, 2002 the revenue used should be for the twelve months ending December 31, 2001
(b) From Step One Above. Note that the basis for determining percent of revenue is different from that in Step One
(c) From percent of revenue net franchise fees in Step Two
(d) From percent change in Step Three
(e) The weighted rate adjustment should be applied to the total rate, including franchise fee portion of the rate
(f) From weighted rate in Step Four
Adjusted Monthly Rate
$36.48
$65.20
$93.94
$122.66
$151.40
$180.12
$41.01
$74.28
$107.55
$140.81
$174.08
$207.34
$45.55
$83.35
$121.15
$158.95
$196.76
$234.57
the a rate
Federal Disposal Service
EXHIBIT 5B (Plan 2, w/PPI I Extraordinary/Depreciation)
(Proposed) Rate Adjustment - Customer Billed By the Company (Except Rolloff)
Step One. Deduct franchise fees from gross rate revenue
Revenue Component (including Franchise Fees) Annual Amount (a) Percent of Rate Revenue
Includin~l Franchise Fees
Actual Gross Commercial and MFR Rate Revenue Groups (1,2,5 & 98) $ 2,384,865 100.0%
Actual Commercial and MFR Franchise Fees Quarterly Reports $ 60,564 2.5%
Actual Gross Commercial and MFR Rate Revenue Net of Franchise Fees $ 2,324,301 97.5%
Step Two: Detarmme d~sposal expense and service revenue percentage of total actual rate revenue
Revenue Component (net of Franchise Fees) Annual Amount (a) Percent of Rate Revenue
Net of Franchise Fees
Actual Commercial and MFR B~n revenue Net of Franchise Fees (b) Groups (1,2, & 5 & 98) $ 2,324,301 100.0%
Less Actual Commer=al and MFR/Dump Tonnage Report $ 873,334 37.6%
Less. Labor Payroll Cost Report $ 801,504 34.5%
Less Deprec~abon Depreciation Schedule $ 172,553 7.4%
Actual Commercial B~n Sennce Revenue $ 476,910 20.5%
Step Three: Calculated percentage change in adjustment factors
Adjustment Factor Old New Percent Chan~le
Disposal Gate Fee per Ton $ 22.00 $ 22.00 0.0%
Labor $ 801,504.00 $ 1,168,656.00 45.8%
Producer Price Index $ 124.20 $ 129.50 4.3%
Step Four Calculated weight percentage change ~n commercial and MFR Bin rates
Components of Actual Revenue Component Wei~lht (c) Percent Chan~le (d) Wei~lhted Rate Adiustment
Refuse Disposal 37.6% 0.0% 0.0%
Service and Depreciation 27.9% 4.3% 1.2%
Labor 34.5% 45.8% 15.8%
Total 100.0% N/A 17.0%
Step F~ve. Applied weighted percentage change to commercial and MFR Bin rates
Service Current Monthly Rate Weighted Rate Adjusted Monthly Rate
(e) Adiustment (f)
1 ea. 2 yard Bin once per week $ 35.53 17.0% $41.57
1 ea. 2 yard Bin twice per week $ 63.51 17.0% $74.30
I ea. 2 yard Bin three times per week $ 91.50 17.0% $107.04
1 ea. 2 yard Bin four times per week $ 119.48 17.0% $139.78
1 ea. 2 yard Bin five times per week $ 147.47 17.0% $172.52
1 ea. 2 yard Bin six times per week $ 175.45 17.0% $205.26
1 ea. 3 yard Bin once per week $ 39.95 17.0% $46.74
1 ea. 3 yard Bin twice per week $ 72.35 17.0% $84.64
1 ea. 3 yard Bin three times per week $ 104.76 17.0% $122.56
I ea. 3 yard Bin four times per week $ 137.16 17.0% $160.46
1 ea. 3 yard Bin five times per week $ 169.56 17.0% $198.37
1 ea. 3 yard Bin six times per week $ 201.96 17.0% $236.27
1 ea. 4 yard Bin once per week $ 44.37 17.0% $51.91
1 ea. 4 yard Bin twice per week $ 81.19 17.0% $94.98
1 ea. 4 yard Bin three times per week $ 118.01 17.0% $138.06
1 ea. 4 yard Bin four times per week $ 154.83 17.0% $181.13
1 ea. 4 yard Bin five times per week $ 191.65 17.0% $224.21
1 ea. 4 ~/ard Bin six times per week $ 228.48 17.0% $267.30
(a) For the twelve months ending on the date six months prior to the effective date of the rate adjustment. For example, for the a rate
adjustment effective July 1, 2002 the revenue used should be for the twelve months ending December 31, 2001
(b) From Step One Above. Note that the basis for determining percent of revenue is different from that in Step One
(c) From percent of revenue net franchise fees in Step Two
(d) From percent change in Step Three
(e) The weighted rate adjustment should be applied to the total rate, including franchise fee portion of the rate
(f) From weighted rate in Step Four
Federal Disposal Service
EXHIBIT 5C
Example Rate Adjustment - Rolloff Rates
Step One: Calculate percentage change in Producer Price Index
Adjustment Factor
Producer Price Index
Old I New
124.20 $ 129.50
Percent4.3% Change
Step Two: Apply percentage change in Producer Price Index to Service Portion of rolloff
rates
Service Current Monthly Rate Adjustment Adjusted Rate
Rate (a)
Standard Rolloff charge per load (b) $ 87.23 4.3% $ 90.95
Compactor charge per load $ 155.00 4.3% $ 161.61
Delivery or relocation charge $ 75.00 4.3% $ 78.20
Temporary "Clean-Up" Bins $ 50.00 4.3% $ 52.13
Locking Bins $ 5.00 4.3% $ 5.21
On-Call Bin Cleaning Services (in excess of lx/yr) $ 35.00 4.3% $ 36.49
Bulky Item Pick up (in excess of 2x/yr) $ 20.00 4.3% $ 20.85
Special Pick (in excess of 2x/yr) Auto Cart Cust $ 5.00 4.3% $ 5.21
e) Percent change in PPI
f) Excluding disposal. Disposal is billed at actual cost based on the gate rate per
ton at the Orange County Landfills multiplied by the number of tons.
Federal Disl~osal Service
Proposed Rates
[F~sidentlal MultI-Famll,v and Comrne_13;ial.~lr//M{~nual Can Rates
Estimated
Row Service Proposed Existing Monthly Annual Billings
Monthly Rate Service Units Billings
I Automated Cart $12.59 $ 9,173 $ 115,470 $ 1,385,642
2 Manual Can $7.59 $ 733 $ 5,565 $ 66,780
3 Total Cart/Can Billin~ls $ 121,035 $ 1,452,423
Commercial and Multi-Famil,v Bin Ratg~
Pickups per Week
Row Service
'1 2 3 4 5 6
4 2 Cubic Yards $41.57 $74.30 $107.04 $139.78 $172.52 $205.26
5 3 Cubic Yards $46.74 $84.64 $122.56 $160.46 $198.37 $236.27
6 4 Cubic Yards $51.91 $94.98 $138.06 $181.13 $224.21 $267.30
Commercial and Multi-Family Bin Distribution Matrix - Number of BIl~S
Pickups per Week
Row Service Total
I 2 3 4 5 6
7 2 Cubic Yards 67 15 14 2 98
8 3 Cubic Yards 236 470 440 105 103 48 1,402
90 4 Cubic Yards 23 127 140 32 42 38 402
Total 326 612 594 137 147 86 1,902
Source: Waste Management, Inc. The City does not assume any responsibilty for the accuracy of the reported information
Commercial and MultI-Famil_v Bin Billings
Pickups per Week
Row Container Total
Size '1 2 3 4 6 6
11 2 Cubic Yards $ 2,785 $ 1,114 $ 1,499 $ $ 345 $ $ 5,743
12 3 Cubic Yards 11,030 39,781 53,925 16,848 20,432 11,341 153,358
13 4 Cubic Yards 1,1 94 12,063 19,328 5,796 9,417 10,157 57,955
14 Total Monthly Billings $ 15,009 $ 52,959 $ 74.752 $ 22,645 $ 30,193 $ 21,498 $ 217,056
15 Total Annual BIIIIn~ls $ 180,105 $ 635,505 $ 897,024 $ 271,737 $ 362,322 $ 257,978 $ 2,604,671
Roll-Off Box Billings
Row Description Billing Unit Units per Proposed Estimated
Year Rate Annual Billings
16 Pull Charge # of Pulls 3,002 $ 90.95 $ 273,039
17 Disposal/Processing Charge # of Tons 13,407 $ 28 375,396
18 Total 16,409 119 648,435
Summary_ of Pro_iected Annual BIIIIng~
19 Residential Multi-Family and Commercial Cart/Manual Can Billings $ 1,452,423
20 Commercial and Multi-Family Bin Service Billings 2,604,671
21 Roll-Off Box Billin~ls 648,435
22 Total Proiected Annual Billin~ls 4,705,528
S_Declal Services
Row Description Rate
23 Temporary Bin Services - Per Pull, plus $5 per day over 7 days $ 52.13
24 Locking Bin - Cost per bin per month $ 5.21
25 Bin Cleaning (in excess of one bin cleaning per year) - Each $ 36.49
26 Additional Bulky Waste Pickup (in excess of 2 per year) - Each $ 20.85
27 Additional Special Pickup for Automated Cart Customers (in excess of 2 per ),ear) - Each $ 5.21
* These unit estimates will be used for purposes of calculating rate revenue and
determining the proposer's overall cost. It assumes that all single family, duplex, and
triplex units will receive automated cart service.
Public Works / Engineering
June 3, 2002
Don Shubin
President
Federal Disposal Service
1661 East Palm Street
Santa Ana, California 92701
Re: 2002 Rate Adjustment Request
City of Tustin
300 Centennial Way
Tustin, CA 92780-3715
(714) 573-3150
FAX (714) 734-8991
Dear Mr. Shubin:
Staff is in the process of reviewing Federal Disposal Services' ("Federal") 2002 rate
adjustment request. Several issues arose during the review requiring further
explanation and/or documentation before we complete the review.
.
In the exhibit "Extraordinary Labor Cost Increase' there are two lines, "Hourly Rate
(Regular)" and "Weighted Rate (Including OT)". It is not clear from your text: 1)
How the weighted rate was calculated and 2) how you arrived at the "union" hourly
rates. Please explain.
.
The request includes a 6,924 hour increase in operating hours, comprised of 4,068
actual hours and 2,856 hours identified as "Increase Labor Hrs.-Union." Please
explain the 4,068 hour increase in operating hours and the assumption(s) used to
determine the 2,856 "Union" hours. Also, please explain why this increase in labor
hours should be exempt from franchise agreement section 6.3, which states: "Such
changes shall not include.., inaccurate estimates by the company of its proposed
cost of operations."
.
Exhibit 5A shows residential rate revenue broken down to its two components:
disposal and service. The residential rate revenue and disposal cost are for the
twelve months ended December 31, 2001. Please provide a copy of the company's
financial statements, general ledger or a reconciliation to the general ledger
supporting the residential rate revenue and disposal cost presented.
.
Exhibit 5B shows commercial rate revenue broken down into three components:
disposal, labor and service. The commercial rate revenue and components are for
the twelve months ended December 31, 2001. Please provide a copy of the
company's financial statements, general ledger or a reconciliation to the general
ledger supporting the commercial rate revenue and the disposal, labor and service
cost components presented.
2002 Rate Adjustment Request
June 3, 2002
Page 2
5. Please breakout the container and equipment depreciation from the residential and
commercial service components on Exhibit 5A and Exhibit 5B.
We plan to take the rate adjustment request, with our recommendation, to the city
Council on July 1, 2002. Time is of the essence. Please respond to the issues
identified above on or before June 10, 2002. This will allow us sufficient time to
complete our review for presentation to the City Council. If you have any questions,
please call me at 714/573-3173.
Very truly yours,
Joe Meyers
Administrative Services Manager
Public Works Department
cc: Tim Serlet, Public Works Director
June 10, 2002
Mr. Joe Meyers
Public Works Department
City of Tustin
300 Centennial Way
Tustin, California 92780
IFEDERAL
DISPOSAL
, SERVICEJ
Corporate Office: 1661 East Palm Street · Santa Ana, CA 92701
Mailing Address: PO BOX 118 · Santa Ana, CA 92702
Telephone: 714-542-7701 · Fax: 714-542-8435
',TUSTIN PUBLIC WORKS DEPT.
RE: Integrated Solid Waste Management Services Franchise
Annual Rate Adjustment
Dear Mr. Meyers,
We are in receipt of the City letter dated June 3, 2002 requesting further explanation
and/or documentation of our request for rate adjustment. We provide the following
responses:
o
In the exhibit "Extraordinary Labor Cost Increase" the "Weighted Rate" in the
"FDS 99 Bid" column was developed based on a 60-hour workweek It is a
calculation of the average (hourly) rate including straight and overtime pay. For
example:
a. Straight time... 40 hours ~ $12.00/hourTM $ 480.00
Overtime ....... 20 hours ~ $18.00/hour= $ 360.00
60 hours $ 840.00
Weighted Rate (60 hours divided by $840.00)= $14.00/hour
bo
The Union "Weighted Rate" is accomplished in an identical method
except that overtime hours worked under the Union Agreement is based
on a 55-hour workweek. For example:
Straight time...40 hours ~ $13.90/hour = $556.00
Overtime ........ 15 hours ~ $ 20.85/hour = $312.75
55 hours $868.75
Weighted Rate (55 hours divided by $ 868.75)= $15.80/hour
2002 Rate Adjustment Request
June 10, 2002
.
.
.
.
The man-hours figure in the "Union" column, on page 11, tiffed "Extraordinary
Labor Cost Increase," is our actual hours performed on the Franchise Agreement.
It is an averaged based on payroll records from the period April and May 2002. It
includes:
a. 4,068 additional labor hours/year above our bid for extra services required
in the community to achieve customer satisfaction, but are not covered by
the Franchise Agreement. Examples of which include, but not limited to:
i. Pickups for residents that do not set out cans on time and demand
us to re-perform.
ii. Picking up extra waste set along side carts as required.
iii. Providing unmerited additional carts to customers on occasions
when they insist.
This request for an increase is not a result of an inaccurate estimate of
costs by this company in its price offer but is for work above and beyond
the service specifications of the Franchise Agreement.
Secondly, the man-hours figure in the "Union" column, on page 11, titled
"Extraordinary Labor Cost Increase," also includes an increase in hours for a
single position with a 55-hr/week, or 2,856 man-hours/year. This increase would
be required with the adoption ora Union contract for the following causes: (1)the
condition that pro .hibit non-union workers (working supervisors) f~om performing
bargaining unit work, and (2) the condition that would require increased
workforce inspection with bargaining unit labor agreements, (3) reduced
efficiency resulting from seniority provisions that determine work assignments.
This request for extraordinary increase is for the labor cost increases resulting
fi.om the Union organization in the county that has affected this company. It
could not have been reasonably anticipated at the time of the price offer.
Please find attached copies of this company's financial statements and
reconciliation to the general ledger for the period ending December 31, 2001.
Please note:
"These financial statements are provided to the City of Tustin for the purpose of
reviewing this request for a rate adjustment. We request information in the
financial statements not to be copied, duplicated, or released outside of the City or
its consultant, to the extent permissible by law. They are not to be used by the
City except for the intended purpose of reviewing this rate adjustment."
The figures used to gauge the percentage change in labor derive from the
"Extraordinary Labor Cost Increase" page 11. They are not directly tied to the
financial statements.
Please find attached revised Exhibit 5A, 5B, 5C and the "proposed" Rate Sheet.
We have broken out container and equipment depreciation expenses as requested.
-2-
2002 Rate Adjustment Request
June 10, 2002
It is our hope that you find these responses adequate. If you should need further detail or
supporting information please give me a call at (714) 542-7701, ext. 207.
President
C~
Tim Serlet, Director of Public Works
Chris Shingleton, Assistant City Manager
Lois Jeffrey, City Attorney
Attachments: Year End Financial Statemems and supporting detail
Revised Attachments 5A, 5B, 5C
Proposed Kate Sheet
-3-
Fecleml Disposal Service
EXHIBIT SA
(Proposed)
Revenue component
Single Family Rate Revenue
Less: Single Family Refuse Disposal Expense
Less: Single Family Equipment Depreciation
Single Family Service Revenue
I~te Adjustment - Customer Billed By the City on Tax Roll
Group (3)
Tonnage Report
Deprec. Schedule
Annual Amoum (a)
1,401,735
273,372
218,471
1,128,363
Step Two: C~l~e per~nt~e change m adju~ment ~
$ 22.00
124.2
N~w
$ 2?_OO
130.2
Adjustment Factor
Disposal Gate Fee per Ton
Producer Price Index
Percent of Rate Revenue
lOO.0%
19.5%
15.4%
e5.1%
Percent Change
4.8%
components of.amtual Revenue
R~.m~ Dispo~l
Service and Depreciation
ITo~
comlxx.~ wwht
19.5%
80.{5%
Percent cm.~e {o) I
0.00/6
I
4.8%
N/AI
We~ht~ ~,t~ ~Justnmt
0.0%
3.9%
100.0% 3.9%
Step Four. Apph/weighted pementage ohange ~ angle family rates
Service Cuwent Monthly Rate (d) /~ljua~! Monthly Rata
Single Family-Aut~Tat~ Cart
Manual Can
$ 12.17
$ 7.34
W~ght~ ~ ~Justment
3.9%
$12.64
$7.63
(a) For the twelve ~ ending on the date ~ix months ~ ~~ ~ ~h ~ adj~ For m~mple, forthe a rate
adjustment effective July 1, 2002 the revenue used should be for the twelve months ending December 31, 2001
(b) From percent of revenue in St~p One
(o) From pement change in Step Two
(e) From weighted ~,~/, adjustment in Step Three
CC: H:~FDS users~ecl~Rate adjustment formula 7
EXHIBIT 5B (Plan 2, w/PPI I Extraordinary/Depreciation)
(Proposed) Rate Adjustment - Customer Billed By the Company (Except Rolloff)
Revenue Component (including Franchise Fees)
Actual Gross Commercial and MFR Rate Revenue Groups (1,2,5 & 98)
Actual Commercial and MFR Franchise Fees Quartmty Reports
Actual Gmes Commercial and MFR Rate Revenue Net of Franchise Fees
Annual Amount (a)
2,384,685
60,564
Includir~ Franchise Fees
100.0~
2.5%
$ 2,324,301 97.5%
Step Two: Detm, mine disposal experme and sewice revenue I~ of to~l
Revenue Component (net of Franchise Feee) Annual Amount (~) Percent of Rate Revenue I
Net of Fr=nchise Fees
Actual Commembll and MFR Bin revenue Net of Fmnchme Fees (b) Groups (1,2, & 5 & 98) $ 2,324,301 100.0%
L.e~s: Ach, mi Commercial and MFRK)ump Tonnage Report $ 873,334 37.616
Less: L~bor I:)w~il Cost Report $ 801,504 34.5%
L.~: Depmcmbon Depreciation Schedule $ 172,553 7.4%
Actum; Comrmfcmt Bin Sewico Revm~ $ 476,910 20.5%
Ad)u~a~em FK~or
Dislxmal C-mt~ Fee per Ton
Labor
$ 22.00
$ 601,504.00
$ 124.20
22.00
1,168,656.00
130.20
0.0%
45.8%
4.8%I
Step Four. CaJculm'mcl weight percef~age change in comrnemial am:l MFR Bin rams
Components of Actual Revenue
Service and Depreciation
Labor
Total
Component Weight
27.9%
34.5%
Step Fhm: Applied weigh'md pemefflaage ¢tmnge to commercial and MFR Bin rmte~
4.8%
N/A
1.3%
15.8%
I ea. 2 yard Bin once per week
I ea. 2 yard Bin twice per
I ea. 2 yard Bin three times per week
1 ea. 2 yard Bin four times per week
I ea. 2 yard Bin five times per week
I ea. 2 yard Bin six times per week
I ea. 3 yard Bin once per week
1 ea. 3 yard Bin twice per week
1 ea. 3 yard Bin three times per week
1 ea. 3 yard Bin four times per week
1 ea. 3 yard Bin five times per week
1 ea. 3 yard Bin six times per week
1 ea. 4 yard Bin once per week
1 ea. 4 yard Bin twice per weak
1 ea. 4 yard Bin three times per week
1 ea. 4 yard Bin four times per week
1 ea. 4 yard Bin five times per week
1 ea. 4 )rard Bin six times per week
Current Monthly Rat~
35.53
63.51
91.50
119.48
147.47
175.45
39.95
72.35
104.76
137.16
169.56
201.96
44.37
81.19
118.01
154.63
191.65
228.48
~d~u~ment
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
17.1%
Monthly Rate
$41.62
$74.4O
$107.19
$139.97
$172.76
$205.53
$84.76
$122.72
$160.68
$198.63
$51.98
$95.11
$138.24
$181.38
$224.51
$267.66
(a) For the twelve months ending on the date six months prior to the ~ date of the rate adjustment. For example, for the a rate
adjustment effective July 1,2002 the revenue used should be for the twelve months ending December 31, 2001
(b) Frorn Step One Above. Note that the besis for determining psrcent of revenue is different from that m Step One
(c) From percent of reverme rmt fmnchiea fees in Step Two
(d) From percent change in Step Three
(e) The weighted rate adjustment should bo applied to the total rate, including franchise fee portion of the rate
~) From weighted rote in Step Four
cc: H:U=DS users~ed~.ate adjustment fofmula~rTab]Exhildt 5B(Ptan 2) Ext 8
EXHIBIT B
STAFF RECOMMENDED RATE ADJUSTMENT
Federal E~isposal Service
EXHIBIT 5A
(Proposed) Rate Adjustment - Customer Billed By the City on Tax Roll
Step One: Determine disposal expense and service revenue as a percent of actual rate revenue
Revenue Component Annual Amount (a) Percent of Rate Revenue
Single Family Rate Revenue
Less: Single Family Refuse Disposal Expense
Less: Single Family Equipment Depreciation
Single Family Service Revenue
Group (3)
Tonnage Report
Deprec. Schedule
$ 1,401,735
$ 273,372
$ 216,471
100.0%
19.5%
15.4%
$ 1,128,363 65.1%
Step Two: Calculate percentage change in adjustment factors
Old New Percent Change
Adjustment Factor
Disposal Gate Fee per Ton
Producer Price Index
$ 22.00
124.2
$ 22.00
129.5
0.0%I
4.3%1
Step Three: Calculate weighted percentage change in single family rates
Components of Actual Revenue
Refuse Disposal
Service and Depreciation
Total
Component Weight (b)
19.5%
80.5%
100.0%
Percent Change (c)0.0%1
4.3%I
N/AI
Weighted Rate Adjustment
0.0%
3.4%
3.4%
Step Four: Apply weighted percentage change to single family rates
Service Current Monthly Rate (d) Weighted Rate Adjustment Adjusted Monthly Rate
(e)
Single Family-Automated Cart
Manual Can
$ 12.17
$ 7.34
3.4%
3.4%
$12.59
$7.59
(a) For the twelve months ending on the date six months prior to the effective date of the rate adjustment. For example, for the a rate
adjustment effective July 1, 2002 the revenue used should be for the twelve months ending December 31, 2001
(b) From percent of revenue in Step One
(c) From percent change in Step Two
(d) The weighted rate adjustment applied to the total rate, including franchise fee portion of the rate
(e) From weighted rate adjustment in Step Three
I~ederal DiSposal Service
EXHIBIT 5B (Plan 1, w/PPI)
(Proposed) Rate Adjustment - Customer Billed By the Company (Except Rolloff)
Step One: Deduct franchise fees from gross rate revenue
Revenue Component (including Franchise Fees)
Actual Gross Commercial and MFR Rate Revenue Groups (1,2,5 & 98)
Actual Commercial and MFR Franchise Fees Quarterly Reports
Actual Gross Commercial and MFR Rate Revenue Net of Franchise Fees
Annual Amount (a)
2,384,865
60,564
2,324,301
100.0%
2.5%
97.5%
Percent of Rate Revenue
Including Franchise Fees
$
Step Two Determine disposal expense and service revenue percentage of total actual rate revenue
Annual Amount (a) Percent of Rate Revenue
Net of Franchise Fees
Revenue Component (net of Franchise Fees)
Actual Commercial and MFR Bin revenue Net of Franchise Fees (b)
Less: Actual Commercial and MFR B~n Refuse
Actual Commercial and MFR Bin Service Revenue
Groups (1,2, & 5 & 98)
Tonnage Report
$ 2,324,301
$ 873,334
$ 1,450,967
100.0%
37.6%
62.4%
Step Three: Calculated percentage change in adjustmenf factors
Adjustment Factor
I Disposal Gate Fee per Ton
IProducer Pdce Index
Old
22.00
124.20
22.00
129.50
Percent Change
0.0%
4.3%
Step Four' Calculated weight percentage change in commercial and MFR B~n rates
RefuseDisposal Components of Actual Revenue
Service
Tota
Component Weight (c)
37.6%
62.4%
100.0%
Percent Change (d)0.0%I
4.3%I
N/AI
Weighted Rate Adiustment
0.0%
2.7%
2.7%
Step Five: Applied weighted percentage change to commercial and MFR Bin rates
Service
1 ea. 2 yard Bin once per week
1 ea. 2 yard Bin twice per week
1 ea. 2 yard Bin three times per week
1 ea. 2 yard Bin four times per week
1 ea. 2 yard Bin five times per week
1 ea. 2 yard Bin six times per week
1 ea. 3 yard Bin once per week
1 ea. 3 yard Bin twice per week
1 ea. 3 yard Bin three times per week
1 ea. 3 yard Bin four times per week
1 ea. 3 yard Bin five times per week
1 ea. 3 yard Bin six times per week
1 ea. 4 yard Bin once per week
1 ea. 4 yard Bin twice per week
1 ea. 4 yard Bin three times per week
1 ea. 4 yard Bin four times per week
1 ea. 4 yard Bin five times per week
1 ea. 4 yard Bin six times per week
Current Monthly Rate
$ 35.53
$ 63.51
$ 91.50
$ 119.48
$ 147.47
$ 175.45
$ 39.95
$ 72.35
$ 104.76
$ 137.16
$ 169.56
$ 201.96
$ 44.37
$ 81.19
$ 118.01
$ 154.83
$ 191.65
$ 228.48
Weighted Rate
Adjustment (f)
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
2.7%
(a) For the twelve months ending on the date six months prior to the effective date of the rate adjustment. For example, for
adjustment effective July 1, 2002 the revenue used should be for the twelve months ending December 31, 2001
(b) From Step One Above. Note that the basis for determining percent of revenue is different from that in Step One
(c) From percent of revenue net franchise fees in Step Two
(d) From percent change in Step Three
(e) The weighted rate adjustment should be applied to the total rate, including franchise fee portion of the rate
(f) From weighted rate in Step Four
Adjusted Monthly Rate
$36.48
$65.20
$93.94
$122.66
$151.40
$180.12
$41.01
$74.28
$107.55
$140.81
$174.08
$2O7.34
$45.55
$83.35
$121.15
$158.95
$196.76
$234.57
the a rate
F~ederal I~isposal Service
EXHIBIT $C
Example Rate Adjustment - Rolloff Rates
Step One: Calculate percentage change in Producer Price Index
I Adjustment Factor I Old I
Producer Price Index $ 124.20 $
New 129'50I
Percent Change
4.3%
Step Two: Apply percentage change in Producer Price Index to Service Portion of rolloff
rates
Service Current Monthly Rate Adjustment Adjusted Rate
Rate (a)
Standard Rolloff charge per load (b) $ 87.23 4.3% $ 90.95
Compactor charge per load $ 155.00 4.3% $ 161.61
Delivery or relocation charge $ 75.00 4.3% $ 78.20
Temporary "Clean-Up" Bins $ 50.00 4.3% $ 52.13
Locking Bins $ 5.00 4.3% $ 5.21
On-Call Bin Cleaning Services (in excess of lx/yr) $ 35.00 4.3% $ 36.49
Bulky Item Pick up (in excess of 2x/yr) $ 20.00 4.3% $ 20.85
Special Pick (in excess of 2x/yr) Auto Cart Cust $ 5.00 4.3% $ 5.21
e) Percent change in PPI
f) Excluding disposal. Disposal is billed at actual cost based on the gate rate per
ton at the Orange County Landfills multiplied by the number of tons.
I~ederal Disl~osal Service
Proposed Rates
Residential Multi-Fan~llY. en. d._C_~_mmerclal CartJManual Can Rates
Estim-~ted
Row Service Proposed Existing Monthly Annual Billings
Monthly/Rate Service Units Billings
1 Automated Cart $12.59 $ 9,173 $ 115,470 $ 1,385.642
2 Manual Can $7.59 $ 733 $ 5,565 $ 66,780
3 Total Cart/Can Billinc, ls $ 121,035 $ 1,452,423
Commercial and Multi-Family Bin Rates
Pickups per Week
Row Service
1 2 3 4 5 6
4 2 Cubic Yards $36.48 $65.20 $93.94 $122.66 $151.40 $180.12
5 3 Cubic Yards $41.01 $74.28 $107.55 $140.81 $174.08 $207.34
6 4 Cubic Yards $45.55 $83.35 $121.15 $158.95 $196.76 $234.57
Commercial and Multi-Famil.v Bin Distribution Matrix - Number of Bins
Pickups per Week
Row Service Total
1 2 3 4 ,5 6
7 2 Cubic Yards 67 15 14 2 98
8 3 Cubic Yards 236 470 440 105 103 48 1,402
9 4 Cubic Yards 23 127 140 32 42 38 402
10 Total 326 612 594 137 147 86 1,902
Source: Waste Management, Inc. The City does not assume any responsibilty for the accuracy of the reported information
Commercial and MultI-Famll_v Bin Billings
Pickups per Week
Row Container Total
Size I 2 3 4 5 6
11 2 Cubic Yards $ 2,444 $ 978 $ 1,315 $ $ 303 $ $ 5,040
12 3 Cubic Yards 9,679 34,910 47,322 14,785 17,930 9,952 134,580
13 4 Cubic Yards 1,048 10,586 16,962 5,087 8,264 8,914 50,859
14 Total Monthly Billings $ 13,171 $ 46,474 $ 65,599 $ 19,872 $ 26,496 $ 18,866 $ 190,478
15 TotalAnnual Billings $ 158,052 $ 557.690 $ 787,187 $ 238,464 $ 317,957 $ 226,390 $ 2,285,741
Roll-Off Box Billings
Row Description Billing Unit Units per Proposed Estimated
Year Rate Annual BIIIIn~ls
16 Pull Charge # of Pulls 3,002 $ 90.95 $ 273.039
17 Disposal/Processing Charge # of Tons 13,407 $ 28 375,396
18 Total 16,409 119 648,435
Summary_ of Pro_lected Annual BIIIIn_~s
19 Residential Multi-Family and Commercial CartJManual Can Billings $ 1,452,423
20 Commercial and Multi-Family Bin Service Billings 2,285,741
21 Roll-Off Box Billings 648,435
22 Total Proiected Annual Billin~ls 4,386,598
Special Services
Row Description Rate
23 Temporary Bin Services - Per Pull, plus $5 per day over 7 days $ 52.13
24 Locking Bin - Cost per bin per month $ 5.21.
25 Bin Cleaning (in excess of one bin cleaning per year) - Each $ 36.49
26 Additional Bulky Waste Pickup (in excess of 2 per year) - Each $ 20.85
27 Additional Special Pickup for Automated Cart Customers (in excess of 2 per year) - Each $ 5.21
* These unit estimates will be used for purposes of calculating rate revenue and
deterTnining the proposer's overall cost. It assumes that all single family, duplex, and
triplex units will receive automated cart service.
EXHIBIT C
RATE SURVEY
0
!