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Home My WebLink About8.6 GarbageRatesAnnualFee CITY CLERK File # D~[l][li]-!:3JriJ __1 AGENDA STATEMENT CITY COUNCIL MEETING DATE: March 15, 2005 SUB.JECT: Establishing The Date Of The Public Hearing For Garbage Company Rates and Annual Fees For Minimum Residential Garbage Service Report Prepared By: Jason Behrmann, Senior Administrative Analyst ATTACHMENTS: J. 2. 3. Comparison of Proposed Rates To Current / Selected Categories Garbage Rate Survey (Livennore/Pleasanton/San Ramon) Public Notices RECOMMENDA nON: ¥ Establish the Public Hearing for May 3, 2005. FINANCIAL STATEMENT: It is proposed that the solid waste rates in the City of Dublin be increased by approximately 19.9% in order to generate the compensation required to satisfy the requirements of the City's new solid waste collection services agreement with Amador Valley Industries (A VI). This increase can be primarily attributed to the rising cost of doing business in the Bay Area and the myriad of new programs and services offered to the community as part of the new agreement. The new agreement provides a cap of five (5%) percent per year on future annual rate increases. DESCRIPTION: Since the passage of Proposition 218 by California voters, all property owners must be notified of Property Related Fees which arc imposed or increased. This Staff Report provides infonnation related to the proposed rate increases for all service Icvels as well as the Public Notices, which will be mailed to all residential property owners with individual can service in the City of Dublin advising them of the proposed minimum service rate increase. Backeround The City's existing contract with Waste Management expires on June 30, 2005. In 2004, the City conducted a competitive proposal proccss for solid waste services. On December 6, 2004, the Council awarded a new 7- year collection service contract to Amador Valley Industries, which offered the best proposal to the City. In January 2005, the City executed the collection service agreement with Amador Valley Industries (A VI) for service to begin July 1,2005. The agreement between the City and A VI requires the City to adopt a rate schedule, which is estimated to produce a specified revenue amount as identified in the Agreement. The City has also adopted an Ordinance, which requires all parcels in the City to subscribe to weekly minimum garbage service. For residential properties that are serviced with individual containers, the City collects the annual cost ofminimunJ service with the property tax bill. This minimum service includes __________________________________________________________~.__~_~___________________________________~M___________ COPIES TO: Robert Molinaro, President, A VI ITEMNO.~ curbside collection of a 35 gallon garbage container, up to two (2) organic waste carts up to 96 gallons each, up to two (2) recycling carts up to 96 gallons each, used oil and filters, an annual household hazardous waste drop off event and three on-call bulky waste pick-ups per year. Residents desiring larger garbage carts are billed directly by the Company for the rate difference. The City pays the service cost for minimnm rcsidential service with monies collected from the property tax bill. GARBAGE RATE CALCULATION Garba!!e Rate Back!!round The current garbage rates becamc cffcctive July I, 2003. The current rates need to be adjusted in order to meet the compensation rcquircments of the new agreement with A VI. Detailed Comparison of Current and Proposed Rates The proposed rate structure is estimated to meet the compensation requirement of $6,039,660 included in the new agreement. For Fiscal Year 2005-2006 it is proposed that all rate categories increase by approximately 19.9%. At the time the Council awarded the contract to A VI, it was estimated that a rate increasc of20.1 % would be required. The rate increase has been reduced, in large part due to a clean air grant the City will receive from the Bay Area Air Quality Management District for purchasing natural gas collection vehicles. The proposed rate increase can primarily be attributed to the rising cost of doing business in the Bay Area and the new programs and services offered to the community as part oftbe new agreement. The new agreemeot provides a cap of five (5%) percent pcr year on future annual rate increases. While many of the programs will remain unchanged, City residents win be offered several new recycling programs, many not offered by other Tri- Valley jurisdictions. Some of the new programs include; residential food waste collection; multi-family bulky waste collection; free community compost giveback; free curbside collection of items such as electronic waste, household batteries, oil filters, tires, white and brown goods; the "Go Green" environmental education program offered to all Dublin schools; and the ability for residents to add an additional organics and/or recyeling cart at DO additional charge. For commercial customers, recycling services will now be bundled with the standard garbage rate, similar to the residential program. In addition, the collection vehicle fleet win be the first in the Tri-Valleyto have 100% natural gas vehicles, eliminating harmful diesel emissions, and contributing to the improvement of the Tri~Valley's air quality. Attachment I compares the proposed rates to the current rates for service levels, which represent a majority of the subscribers in the City. The proposed rates would be effective July I, 2005. Competitiveness of Dublin Rates with Neiehborine Aeencies As shown in Attachment 2, thc proposed City of Dublin rates remain very competitive compared to rates charged for similar services in surrounding communities. In most cases, the City of Dublin service levels are at least comparable, and often better than the survey cities. For example, Pleasanton does not offer any bulky waste pick-ups and Livennore and San Ramon charge extra for many of the items such as electronic waste, and applianccs that A VI win pick up frcc of charge for Dublin residents. Therefore, the City of Dublin customers reccive more services. For most rate categories, the proposed City of Dubiin ratcs are similar and in many cases below the average of the Tri- Valley agencies surveyed. Annual Fee For Minimum Residential Garba!!e 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 servicc. The proposed fee for Fiscal Year 2005-2006 is $146.04, which cquatcs to $12.17 pcr month. Thc monthly equivalent is the same amount the City wiIJ pay the company. The additional cost of collection and delinquencies are expected to bc 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 2005/2006 rcprcsents a 19.9% increase over tbe Fiscal Year 2004-2005 assessment. The following table shows the historical annual assessments: Historical Annual Fee For Minimum Garbage Service Collected With Property Tax Bill 1999/00 2000/01 2001/02 2002/03 2003/04 2004/05 Proposed 2005/06 $120.60 $121.80 $121.80 $121.80 $121.80 $121.80 146.04 Approval Process In accordance with Proposition 218, Staff will be mailing the attached Notices (Attachment 3) to all residential parcel owners with individual cart service in the City of Dublin. Assessor records indicate that there are approximately 8,900 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 March 18, 2005. The Notice will include three separate pages. The first two pages include a Summary which identifies the City Council Public Hearing date and time (May 3, 2005). In addition, this notice explains what is required to protest the imposition of the fee. In the event that tbe 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 one-page document explains the Minimum Garbage Service Fee. Recommendation Staff recommends that the City Council establish a Public Hearing on May 3,2005 for the adoption of garbage rates. COMPARISON OF SELECTED RATES Current vs Proposed Proposed Increase over Current Proposed 2004t2005 Residential -Monthly Rates Rate 2005/2006 $ % Minimum Residential (35) Gallon $10.15 $ 12.17 $ 2.02 19_9% 64 Gallon Residential $18.65 $ 22.36 $ 3.71 19.9% Sample rate categories represent 96% of residential customers Additional Green Waste Recycling Can: $ 4.00 $ $ (4.00) -100.0% per can per month $ Multi-Family Recycling (per unit): $ 0.60 $ $ (0.60) -100_0% Commercial -Month Iv Rates 1 Yard - 1 time 1 wk $ 43.46 $ 52.11 $ 8.65 19.9% 2 Yard -1 time/wk $ 86.92 $ 104.22 $ 17.30 19_9% 3 Yard -1 time/wk $ 130.38 $ 156.33 $ 25.95 19.9% 3 Yard - 2 times 1 wk $ 271.58 $ 325.63 $ 54.05 19.9% 4 Yard - 1 Time 1 wk $ 173.84 $ 208.44 $ 34.60 19.9% 4 Yards - 2 times I wk $ 358.50 $ 429.85 $ 71.35 19.9% Sample rate categories represent 71% of commercial customers Drop Box - Rates Per Service 20 Yard Loose $ 261.00 $ 313.00 $ 52.00 19.9% 30 Yard Loose $ 391.50 $ 469_50 $ 78. 00 19_9% 40 Yard Loose $ 522_00 $ 626.00 $ 104_00 19.9% Represents 85% of 2004 non-compacted Drop Box Subscriptions 30 Yard Compacted $ 783.00 $ 938.70 $ 155.70 19_9% Represents 67% of the 2004 compacted Drop Box Subscriptions Handy Hauler Available To Residents $ 60.70 $ 72_78 $ 12.08 19_9% ATTACHMENT 1 it' 2: :ß cJ¡& I: 0"<> .!!! 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't""..... 0000 q\DOO æ~~~ æ IIß- tA tß- .........If- .....NM'? 8ß8g ~mæ~ tI)"'it'IDm æwtBw ~~~b o)¡;Ót;Ó~ olC)oN M.....(D°ft ~ ø~~~ 0000 ~s~i www"..,. ~(1mÞ.i f3~gg ['I'):lnl'-C)~ ~ ~~ætA#. <:5 ~~~æm g~~~.§ N .., .... 0_ j' ~ m www~u ~ <D t '" '" ;t ~ .. 1> u ~~ 1) E ~ ~ " ~~ o 0 8 E :;j ~~~-.J8~ tc."E'E'E'E= m ro IT! rn -§ 0>->->->-0 Q~g~g* ,,; ~ if o .. Iii' ~ ~ ~ 'g ~ -0 o " ~ s ~ E ~ .~ ~ 00 '¡; 00 g: .!II J¡ E .~ '¡; § .~ 8 -0 o '" ~ E .!) .5 <D ,. '¡; ~ ~ ~ ~ 00 00 '" -iJ ill ¡¡ 5 ~ $ ~ 00 '" ~ " t ~ > w ATTACHMENT 2 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 REV lEW 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 offees related to Refuse Collection Services for Garbage CoUectionmisposal-Recycllng 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 subject to property tax assessment for minimum garbage service as defined in Chapter 5.32 of the Dublin Municipal Code. 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 Chan!!e Basic service wili increase from $121.80 to $146.04; a $24.24 increase for 2005-2006. Thc fee will be adjusted annually. Residential Minimum Garbage 1 Recycling Services All Residential Units Not Serviced By Central Dumpster Bins Collcctcd With Property Tax Bill.(Anyadditional Services are bitled and collected by Amador Valley Industrics Weekly Collection and Disposal of: (I) 35 gal. garbage container; (up to 2) 96 gallon Organic Waste Container; (up to 2) 96 gallon Recycling Container; and 3 on-call bulky item pick-ups. WHEN WILL THE CITY COUNCIL ADOPT THE FEES? (PUBLIC HEARING DATE & TIME) The City Council will consider the adoption ofthe proposed fees at a Public Hearing on; Tuesday May 3, 2005 7;00 p.m. - City Council Chambers 100 Civic Plaza Dublin, California 94568 ATTACHMENT 3 WHY IS THERE A NEED FOR A RATE INCREASE? The City's existing contract with Waste Management expires on June 30, 2005. In 2004, the City conducted a competitive proposal process for solid waste services. On December 6, 2004, the Council awarded a new 7-year contract to Amador Valley Industries, which offered the bcst proposal to the City. WHEN WILL THE NEW FEES BE EFFECTIVE? The fees will be effective beginning July I, 2005, and will bc adjusted annual1y. 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 residential rates are less than the average of rates from Pleasanton, San Ramon and Livermore. WHAT NEW SERVICES WII"L BE OFFERED? Under the new contract with Amador Valley Industries, Dublin's recycling programs will be among the most comprehensive in the State. Some ofthe new programs witt inc1ude; residential food waste collection; multi-family bulky waste collection; free community compost giveback; free curbside collection and recycling of items such as electronic waste, household batteries, oil filters and appliances; the "Go Green" environmental education program offered to all Dublin schools; and the ability for residents to add an additional organics and/or recycling cart at no additional charge. In addition, the collection vehicle fleet will be the first in the TriNalley to have 100% natural gas vehicles, eliminating harmful dicsel emissions, and contributing to the improvement of the Tri- Valley's air quality 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: I) 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 Asscssor'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, 100 Civic Plaza Dublin, California 94568. In order to be counted, all of the information diseusscd 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 thc purposes of the identified programs. This has always been the policy of the City and Proposition 2 I 8 also includcd this requirement in the State Constitution. The fees collected with the property tax bill arc accounted for by the City in separate accounts, to assure that they are only used for authorized expenditures. Interest revenue is also col1ected on the investment of the idle funds. This hclps 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, thcy arc carried over to reduce the cost of the program in thc following year. Each year thc City obtains an independent audit of the Itnancial records for all funds collectcd and expended by the City. QUESTIONS'! It is our hope that the information included with this Notice is helpful in answering thc most common questions. In the event that you have additional questions, plcasc contact the appropriate number shown below: Garbagc and Recycling Fees and Charges - City Manager's Office (925) 833-6650 City of Dublin RESIDENTIAL MINIMUM GARBAGE / RECYCLING SERVICES (Collected With Residential Property Tax Bills) Basis of Fees The City has negotiatcd a mnlti-year agreement with Amador Valley Industries (A VI) requiring a rate adjustment to the residential minimum garbage/recycling services collected with the property tax bills. The current annual fee of$12i.80 per year will increase $24.24 tor a total of$146.04 for 2005-2006. The annual assessment equates to a monthly increase of$2.02, ftom $10.15 to $12.17. Each year thereafter, annual adjustments to the rates will be based upon annual changes in five separate Indices maintained by the Bureau of Labor Statistics (Refuse Rate Index), plus pass-through disposal costs. The five indices account for cost changes in the following categories: labor; fuel and oil; vehicle replacement; vehicle maintenance; and all other costs. There is a 5% cap on the annual adjustment to the Refuse Rate Index. In order to determine 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, according to the tenns ofthe agreement with A VI. The specitic factors considered in this calculation include the following components: the residential rate for Minimum Service; 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 fTom late payments and interest earnings; and funds available fTom collections in a prior year. Affected Parcels Chapter 5.32 ofthe Dublin Mnnicipal Code requires for the protection of the health safety and welfare of the community that all pareels obtain minimum weekly garbage service. 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 arc not serviced by central bins. This does include duplexes and other attached housing types, which reccive individual service. Households subject to this fee which only receive Minimum Service, will not be billed by the Garbage Company. The City's new solid waste collection service provider, Amador Valley industries will 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. What Services Are Provided By The Fee Minimum service inclndcs weekly curbside collection of a 35 gallon garbage container, up to two organic waste carts up to 96 gallons each, up to two recycling carts up to 96 gallons each, uscd oil and filters, an annual household hazardous waste drop off evcnt and three on-call bulky waste pick-ups per year. 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 paymcnt to Amador Valley Industrics based upon the current rate allowed for Minimum Residential Scrvicc. ANNUAL FEE $ 146.04 $146.04 $ 292.08 $146.04times the number of units Although the proposed Fiscal Year 2005-2006 fec is a 19.9% increase over thc 2004-2005 fee, the amount is similar to other neighboring jurisdiction that otIer fewer services. TYPF: OF HOUSING UNIT Each Single Family Residence Each Condominium 1 Townhouse Unit Each Duplex (2 Units) Each Duplex (5 or More Units)