Adjustment of commercial and residential solid waste disposal rates

Browse Search

CITY OF COLTON AGENDA REPORT Council Meeting of June 5, 2001 TO: Honorable Mayor and Council Members FROM: Daryl J. Parrish, Assistant City Manager SUBJECT: Proposed Adjustment of Commercial and Residential Solid Waste Disposal Rates per the Agreement between the City of Colton and Taormina Industries LLC dated June 1, 1999 DATE: May 24, 2001 BACKGROUND: Prior to July 1996 the City of Colton provided residential municipal solid waste collection and disposal services and "light" commercial solid waste collection and disposal services to the community through the Refuse Division of the Public Works Department. Commercial services were provided by a variety of different contract solid waste haulers permitted by the City of Colton. At that time the rate for residential service was $18.40 per month. The current residential rate of $15.96 has been in place since July 1, 1996. In July 1996 the City of Colton entered into an agreement with Taormina Industries, LLC (Republic Services) for the Collection and Processing of Municipal Solid Waste. The 1996 agreement contained a "rate adjustment clause" that was based on two components: (1) the Tipping Fee Component and (2) the Service Fee Component. Changes in the Tipping Fee Component were (and still are) based on the average of all tipping fees paid by the hauler for disposing of refuse at permitted disposal or composting facilities. Changes in the Service Fee Component were (and still are) determined by changes in the Consumer Price Index for the Los Angeles — Riverside - Orange County Index Area ("CPI"). Simply stated, according to the adjustment clause stipulated in the agreement, the Tipping Fee Component will be adjusted over time to compensate for changes in the cost of the disposal of municipal solid waste into the County Landfill System (and the cost of the disposal of yard waste into a permitted composting facility), and the Service Fee Component will be adjusted over time to allow the contractor to continue to provide service under conditions where labor, equipment, and insurance costs are increasing. Although the agreement was amended on established in the rate adjustment clause unchanged from the original 1996 agreement. Fee Components June 1, 1999 the formulaic relationship of the contract remained essentially SB County Landfill Tipping Fee (Gate) July 1, 2000 $33.00 / Ton SB County landfill Tipping Fee (Gate) July 1, 2001 $35.27 / Ton Change = $2.27 or 6.88 % CPI Los Angeles — Riverside- Orange County Index for January 2001 = 3.8 % Item #20