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HomeMy WebLinkAbout8.8 1993 Garbage Rate Application Issues CITY OF DUBLIN AGENDA STATEMENT CITY COUNCIL MEETING DATE: December 14, 1992 SUBJECT: Consideration of Issues Impacting 1993 Garbage Rate Application (Prepared by: Paul S. Rankin, Assistant City Manager) EXHIBITS ATTACHED: 1. Letter dated October 21, 1992 Re: Change in Recycling Rate 2. Resolution Approving Amendment to Recycling Agreement 3. Survey for Franchise Fees and Other Surcharges RECOMMENDATION: Adopt resolution approving Amendment to Recycling Agreement and provide Staff with direction on 1 issues outlined in the final section of the report. FINANCIAL STATEMENT: See Report. DESCRIPTION: The City participates as a member of the Joint Refuse Rate Review Committee (JRRRC) . This Committee has representation from the 13 jurisdictions in Alameda County which receive garbage services from Oakland Scavenger Company. The JRRRC provides an opportunity for the agencies to collectively review rate applications as well as other issues impacting garbage rates. The purpose of this Staff report is to identify significant policy related issues which will need to be addressed once the rate review is finalized. At this time, Staff has preliminary information. Input from the City Council will allow Staff to prepare proposed resolutions and any potential agreements for consideration at the next meeting. 1992 - FIRST YEAR OF JURISDICTIONAL BASED RATES The last rate application considered by the City Council represented a substantial change in methodology. For the first time, the Oakland Scavenger Company (OSC) presented expense and revenue data on a jurisdiction basis. In other words, figures for the City of Dublin were separate from other cities. In some cases, these projections were based on allocations. For example, overhead type costs at the Livermore/Dublin division need to be spread to the two cities. The change to jurisdiction based rates was favorable for the City of Dublin. RECYCLING Currently, the base level of garbage service provided to residential customers includes a curbside recycling service. The provision of this service is outside the franchised rate review process. This means that the Company has assumed all risks associated with providing the service at a profit. Assumption of the risk also relates directly to changes which may occur in the price paid for the commodities collected. Pursuant to the agreement for recycling, the Company is entitled annually to adjust the portion of the base garbage fee associated with recycling. The current basic monthly garbage rates are as follows: - Total Basic Collection Clean-ups Recycling Monthly Super Recycler $5.05 .30 $1.30 $6. 65 (20 Gallon Can) Standard. Service $6.30 .30 $1.30 $7.90 (32 Gallon Caa+,) u COPIES TO: 4 Dan Borges, LDD General Manager D. David MacDonald, Oakland Scaven er ITEM NO. o CITY CLERK M-21^1 h The Company is allowed to make changes to the Recycling Component based on changes to the Consumer Price Index. In the twelve months ending September 30, 1992 the CPI increased by 2.9%. This equates to a 4 cent increase in the recycling component of the basic residential garbage rate. For rate setting purposes, Staff would recommend that the City Council concur with the inclusion of $1.34 as the 1993 curbside recycling rate. The current policy is to include the recycling fee on the first can of service. Staff does not recommend any change to this process. MEASURE D CREDIT FOR RECYCLING SERVICE As directed by the City Council at the meeting on October 26, 1992, Staff has prepared an agreement which will provide a one-time credit for recycling (Exhibit 2) . The City is authorized to utilize Measure D funds for this purpose. These funds were provided to the City at the conclusion of the Superior Court action which declared Measure D invalid. The basic proposal accommodated by this agreement would grant all customers receiving curbside recycling services a one-time $8.04 credit on the garbage bill covering the period of January 1993 - March 1993. The amount of the credit is based upon the total cost of the recycling component for the first six months of 1993 (i. e. . $1.34 x 6 months = $8. 04) . The agreement also specifies that the Company would provide an insert explaining the credit. A minor change has been incorporated in the agreement compared to the financial information previously presented to the City Council. The previous calculation provided for a maximum total reimbursement of $42,800. In order to accommodate any changes in the customer base, Staff has changed the maximum amount to $43, 000. This will provide for reimbursement to 5,348 accounts. As of December 1, 1992 the Company had 5,321 active accounts. The City will only reimburse for the actual number of accounts receiving the credit on the January billing. Staff recommends that the City Council adopt the resolution which will authorize the one-time credit. COST OF SPECIAL CLEAN-UPS During the 1992 rate review, Staff indicated that the Company would be collecting additional data on the cost of the four special Saturday clean- ups. Prior to 1992, the understanding was that 2 clean-ups were funded through the rates and two were funded with special funds. The reporting systems in place did not provide a good accounting of the actual cost of this service. There also was not a clear linkage that the cost was included in the residential rates as opposed to other service levels such as commercial rates. Residences with individual back yard service are the only customers who receive special clean-ups. In 1992, the basic residential charges were designed to include a 30 cent clean-up component on the first can of service (see chart under "Recycling" above) . The intent was to attempt to recover the cost of the two clean-ups which had previously been funded outside the rates. The Company has been able to provide actual data for the 1992 clean-ups. In 1992, the decision to include 4 clean-ups in the rates did not provide for lengthy customer notice of the January clean-up. The tonnage collected at the January clean-up was well below the average of the three remaining clean-ups (-i.e. 187 tons collected Jan. vs. average of 338 tons at each of the remaining) . Given this discrepancy, Staff has calculated the estimated cost based upon the three clean-ups which were well utilized. The following summarizes information on the clean-ups conducted in April, July and October of 1992 : -2- 1992 Clean-Up Data (Excludes January Clean-Up) April July October Total for 3 Wages $ 11 ,220 $ 11 ,169 $ 10,842 $ 33,231 Fuel/Maintenance 1 ,665 1 ,540 1 ,480 4,685 Disposal 5, 154 3,742 3,667 12,563 Total Cost $ 18,039 $ 16,451 $ 15,989 $ 50,479 # Tons Collected 416 302 296 1 , 104 Total Cost for 3 Clean-Ups $ 50,479 Average Cost Per Clean-Up $ 16,826 Annual Cost 4 Clean-Ups (4 x Average) $ 67,304 Estimated Per Customer # of Customers 5,300 Annual Cost/Customer $ 12.69 Monthly Cost Per Customer $ 1 .06 These costs were prepared to give a general indication of the cost of major activities which are required to provide this service. The cost estimates do not address all of the components to provide the service. For example, vehicle depreciation, certain overhead and other costs have not been calculated. DIRECTION ON NUMBER OF CLEAN-UPS TO BE PROVIDED One way of reducing the cost of residential garbage service is to reduce the service level. The City currently provides four quarterly clean-ups, which is a high level of service. The clean-up has certain restrictions, which are summarized below: ■ Garbage must be in disposable containers and placed at the curb by 5:30 a.m. e Branches must be tied and no longer than 5 feet in length. ■ Maximum collected per residence is 3 cubic yards (Approximately 24 trash bags. ) ■ No single items over 75 pounds. ■ The following are not accepted: hazardous waste, concrete, dirt, and appliances. The clean-ups are well utilized and have become an expected service level for most customers. If the City elects to continue with four clean-ups in 1993, the Company has proposed the following dates: January 23 April 10 July 17 October 16 The Company has developed this schedule which is consistent with previous years and does not conflict with their equipment and staffing needs for clean-ups in other communities. Typically, the Company has notified residents of the clean-up dates on the bill. In addition, the City has used the Community Calendar as a reminder. The Calendar will not be an option in 1993. Staff and the Company are also concerned about the need to provide advance notice to the customer. Typically, City Council action on the rate application occurs in early January. This process does not provide adequate lead time for the first i -3- clean-up. The Company has limited flexibility to shift the January clean- up to early February, due to commitments in other communities. Staff would propose that if four clean-ups are maintained, that the Company be authorized to proceed with a separate postcard mailing. The mailing would notify the customer of the clean-up dates for 1993. This could be mailed no later than the first week of January. The cost of preparing and mailing the notice would be recovered by the Company in their rates. After the first quarter billing, the quarterly bills would also include a reminder of the upcoming clean-up date. The City would also attempt to supplement this effort with press releases. Staff recommends that the City Council determine the number of clean-ups to be provided. If a reduction in service levels is desired, the City Council should identify the preferred clean-up dates. If the four clean-up dates are maintained, Staff would recommend that the City Council authorize the Company to proceed immediately with a separate postcard mailing containing the 1993 dates. PLACEMENT OF FULL COST OF CLEAN-UP COMPONENT ON FIRST CAN OF SERVICE As indicated above, the estimated monthly cost of four clean-ups is approximately $1. 06 per household per month. When the City Council considered the 1992 adjustment, Staff noted that monitoring of future costs would allow for an appropriate adjustment in the future. Based upon past policy to collect for standard services on the first can (i.e. recycling) , the City Council should provide Staff with direction as to the treatment of clean-up costs. There are several reasons which support a policy to include the cost of this service in the basic service level. The following are some of the reasons to continue this policy: 1. All customers have an equal opportunity to take advantage of this service. 2. It may be inappropriate to increase costs to multi-can customers, since they may use the clean-ups to a lesser extent. This is due to the fact that they have additional capacity available on a regular basis. 3o It reinforces the concept that rate payers are contributing in proportion to the services offered. Staff would recommend that the City Council impose the full cost of clean- ups on the first can. As discussed later in this report, a proposed reduction in the disposal component will minimize the impact of this change. ADMINISTRATIVE COST RECOVERY Staff has indicated to the City Council in the past a need to develop an on-going revenue source to support the administration of waste management programs. This includes rate review and oversight of the services provided, as well as implementation and reporting required for AB 939. In Fiscal Year 1992/93, a portion of Staff costs were offset with Measure D fees. This totalled $25,497 and was associated only with salary and benefit costs of portions of the Assistant City Manager and Management Assistant positions. The use of these fees was restricted to time expended on recycling or waste reduction activities. An option evaluated by Staff would be to request that -the Company assess a fee which would be returned to the City for use on Administration of all Waste Management functions. The City currently collects a 4.8% Franchise Fee which is based upon Gross Revenues billed by the Company. Staff estimates that an additional 2% fee would generate approximately $42, 000 per year. In essence this additional administrative fee would function similar to the franchise fee. The difference would be that the Waste Management Administrative Fees would be accounted for as a special revenue ratherr thaLn. a general fund revenue. The City would commit to utilize these -4- funds exclusively for waste management activities. The amount would be adequate to also recover overhead costs. If the City imposed its current franchise fee of 4.8% and a 2% Administrative Fee, the total City Fees would be 6.8% of gross revenues. As shown on Exhibit 3, even with this increase, the City of Dublin would rank 12th lowest out of 13 Alameda County jurisdictions. The rate would be less than half of the average levied by other jurisdictions. Staff recommends this as a reasonable approach to providing long term funding for these activities. As the City Council is aware, changes in State Law have continued to expand the level of City administration required over waste management activities. As noted in the following section, the current surplus in Company revenue will minimize the impact of this change at this time. ABILITY TO REDUCE TOTAL REVENUE TO COMPANY The preliminary findings of the JRRRC Report are that the City can reduce total revenue to the Company in 1993. As with prior rate applications, Staff would recommend caution in reducing rates too severely. The rate applications are based upon projections and the actual numbers may vary. Also, changes in the economy significantly affect the quantity of garbage handled in a specific year. Based upon preliminary data, it is anticipated that revenue can be reduced by 11. 6% in 1993 . The addition of an Administrative Fee by the City will decrease the amount of an adjustment which can be made. It is important not _to equate changes in revenue with changes in rates. The difference occurs due to the fact that revenue is collected at different levels depending on the class of service. The following table shows how the Company revenue is distributed in the City of Dublin by type of service: Residential Commercial Roll-Off City of' Dublin 28.3% 54. 6% 17.1% By comparison in the City of Livermore, the Company receives 45. 6% of revenue from the residential category. The following calculation shows the potential target revenue reduction for 1993, based upon preliminary data from the 1993 Rate Application: a. Projected 1993 Revenue $2,357,000 b. Estimated Expenses including Profit $2,094, 000 C. Estimated Additional Cost of City 2% Administrative Fee 42, 000 d. Total Projected Expenses $2, 136, 000 Amount of Projected Surplus Revenue (a-d) _ $221,000 In order to address the projected surplus, Staff would recommend that the City Council undertake rate adjustments in 1993 which will reduce Company revenues by $200, 000 - $221, 000. The reason for the range is to allow flexibility in the event that actual year end results vary. CONCEPTUAL 1993 RESIDENTIAL RATE STRUCTURE The Recycling and Clean-up components of the residential-rates have been discussed above. The remaining component to be considered is the uniform rate for disposal. As noted earlier, the current residential rate uses $6.30 for the uniform can disposal cost (each 32 gallon container) . Recycling and clean-up services are added to the first can. The Super Recycler which consists of weekly collection of a 20 gallon can, includes a $5.05 per month disposal component. When this rate was established, the intent was to price the disposal cost at 20% less than a standard. 32 gallon can. -5- Staff is recommending that the basic disposal component cost be reduced by 12.5% to $5.60. The Super Recycler Rate would decrease to $4.50 if a similar 20% discount were maintained. The following chart summarizes the total impact of residential rate adjustments discussed in this report. OPTION FOR 1993 RESIDENTIAL RATES Proposed Monthly Change 1992 Rate 1993 Rate In Cost 1 Can Customer Uniform Disposal $6.30 $5.60 Clean-Up .30 1 .06 Recycling 1 .30 1 .34 + 10(r/mo TOTAL BASIC SERVICE $7.90 $8.00 2 Can Customer Basic Service $ 7.90 $ 8.00 1 add'1 Uniform Disposal 6.30 5.60 TOTAL $14.20 $13.60 -601t/mo Super Recycler 20 Gallon Disposal $5.05 $4.50 Clean-Up .30 1 .06 Recycling 1 .30 1 .34 BASE COST OF SERVICE $6.65 $6.90 +254t/mo This option attempts to recognize the array of services made available to residential customers. The basic level of garbage service at $8.00 per month provides a significant number of services. The basic services include: ■ Backyard Collection on a weekly basis of one 32 Gallon Container. ■ Four Special Clean-Ups providing for removal of a total of 12 cubic yards of debris per year. ■ Curbside collection of recyclables. Even with the high level of services offered, the City of Dublin rates remain extremely favorable when compared to surrounding communities. Preliminary projections are that the proposed rate adjustment will reduce total revenue to the Company be approximately $20,000. COMMERCIAL/DROP BOX RATE ADJUSTMENTS The commercial sector is more difficult to analyze and develop recommended rate adjustments. Therefore, actual rate scenarios will be presented once the final JRRRC Report is considered by the City Council. It should be noted that these sectors represent over 70% of the revenue collected by the Company. These types of services also tend to be the most volatile in terms of attempting to project workload. The economy can significantly alter the level of business in these areas. For example, the lack of construction activity reduces drop box service. Although certain direct expenses such as landfill and fuel are also reduced, .this results in a smaller base to absorb overhead operating expenses. The commercial service consists of two service types Commercial Bin Service and Roll-Off Service. Commercial bins are typically found at stores and multi-family residences. The service is relatively efficient since a front-end loader truck services several accounts and then hauls the waste directly to the dump. The Roll-Off Service consists of large debris boxes and is less efficient. The truck must travel to and from the landfill after servicing each account. In general terms, Staff is anticipating a proposed reduction in rates for Commercial Bin Service. The Company is providing assistance to avoid making too large of a reduction which would then require an increase in 1994. Staff will also be obtaining comparative data from surrounding communities. Preliminary recommendations for Roll-Off Service would be to freeze the current rates. The current rates continue to be competitive with surrounding communities and this type of service is costly to provide. BALANCING ACCOUNT Beginning with the 1992 Rate Application, the members of the JRRRC developed a methodology to address the Balancing Account. At that time there was a deficit balance which meant that the rate payers owed the Company monies for operational costs in prior years. The JRRRC members concurred with a formula to disperse the amount owed to the various jurisdictions. The Company requested that agencies attempt to eliminate their deficit in 3 years. Preliminary projections estimate that the City of Dublin will have eliminated its share of the balancing account by December 31 , 1992. In fact, the initial estimates suggest that there may be a surplus of approximately $217,000. Due to the following reasons, Staff is recommending that the City Council defer action on any rate reduction to address this surplus until 1994: 1 . The estimated surplus is based largely on projections and the actual amount may vary. 2. The Company will be in a position by mid 1993 to provide actual data on the amount of any surplus. 3. The Company will track the surplus funds plus interest earned for use in addressing future rate adjustments. 4. Several outstanding issues remain undetermined, which can affect the cost of service. .These include: ■ Final negotiation of how landfill closure and post closure costs will be collected. Also, updated cost projections must be considered. ■ Pending ruling on the appeal of Measure D. ■ Uncertainty of economic factors in 1993. 5. If the City lowers rates in order to fully eliminate the surplus in one year, a significant rate increase may be required the following year. For these reasons, Staff is recommending that the City Council conceptually concur with this approach. During the upcoming year, Staff will pursue finalizing some of the outstanding issues and present a proposal with the 1994 Rate. Application. SUMMARY OF ISSUES TO BE CONSIDERED BY CITY COUNCIL In order to provide Staff with adequate direction to prepare necessary resolutions and agreements, it is important to obtain City Council direction on several items addressed in this Report. The following summarizes the issues and actions required: RECYCLING 1 . Direct Staff to incorporate the new monthly recycling rate of $1 .34 in the 1993 Residential Garbage Rate Structure. 2. Adopt Resolution providing One-time Measure D Credit. CLEAN-UPS 1 . Determine the number of special clean-ups to be included in .;the rates. 2. Determine whether the Company should do a special mailing on the Clean-Up Schedule. 3. Determine whether the full cost of $1 .06 per month should be included on the first can of service. -7- ADMINISTRATIVE FEE 1. Provide direction on whether an Administrative Waste Management Fee should be considered. 2. If this fee is pursued, direct Staff to prepare the necessary amendments to the agreements with Oakland Scavenger Company. RESIDENTIAL RATES Provide direction as to whether Staff should develop rate resolutions which provide for a 12.5% decrease in the basic disposal component. SURPLUS BALANCING ACCOUNT Direct Staff to report on the elimination of any surplus balancing account beginning with the 1991 rate application. ADDITIONAL ISSUES Provide Staff with input on additional concerns or issues which should be addressed in the final report to the City Council on the 1993 Rate Application. PSR/lss a:1214Garb.agenda#10 a —8— OCT 2 21994 Livermore Dublin Disposal XYM n'''rf� 6175 South Front Road A Wast Manage n(�jany Livermore, California 94550 11�� 510/447-1300 October 21, 1992 Mr. . Paul S. Rankin Assistant, City Manager City of Dublin loo Civic Center Plaza Dublin, CA . 94568 Dear Paul: The curbside recycling program for the City of Dublin has been in operation for two years." We continue to have ' increases in the amount of material collected from the previous year. We would hope, with the continued effort of the citizens of the City of Dublin, that the program will continue to be a success in the future In section VI of our agreement we may request a annual adjustment to the fee charges based on the Consumer Price Index. Based on the attached index the consumer pric twelve months. This would equat e to index a four cent increasehinithe fee. With the City of Dublin's approval we would like to increase the recycling fee to $1.34 on January 1, 1993. Please review the table and' call me so we can set a date to discuss this matter. Sincerely, Dan B ges Division President and General Manager DB:tle a division of Oakland Scavenger Company RESOLUTION NO. - 92 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN **************** APPROVING FIRST AMENDMENT TO RECYCLING AGREEMENT WHEREAS, the City of Dublin has an existing agreement with Oakland Scavenger Company (OSC) and Livermore Dublin Disposal (LDD) to provide curbside recycling; and WHEREAS, OSC bills the customers directly as part of the basic residential garbage service; and WHEREAS, the City has received special funds which can only be used for recycling activities; and WHEREAS, the City has elected to utilize a portion of the funds for a one-time recycling credit; and WHEREAS, the City, LDD and OSC have developed an agreement which would provide for the one-time credit and is attached hereto as Exhibit A and by reference made a part hereof. NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby approve the agreement contained .in Exhibit A and the Mayor is hereby authorized to execute said agreement on behalf of the City of Dublin. PASSED, APPROVED AND ADOPTED this 14th day of December, 1992. AYES: NOES: ABSENT: ABSTAIN: Mayor ATTEST: City Clerk PSR/lss a:resorecy.agenda#10 x FIRST AMENDMENT TO RECYCLING AGREEMENT BETWEEN CITY OF DUBLIN, OAKLAND SCAVENGER COMPANY AND LIVERMORE-DUBLIN DISPOSAL DATED APRIL 24, 1990 TO PROVIDE FOR A ONE-TIME ALLOCATION OF MEASURE D FUNDS RECITALS A. The City Council has approved an agreement dated April 24, 1990, which provides a comprehensive Curbside Recycling Program; B. The agreement is between the City of Dublin (CITY) , Oakland Scavenger Company (OSC) , and Livermore Dublin Disposal (LDD) ; C. Section VI of the Agreement specifies that LDD is entitled to collect a fee on a per unit basis and that said fee can be increased by changes in the Consumer Price Index; D. The City of Dublin has received certain Measure D: Alameda County Recycling Initiative Funds as a result of a Stipulation in Superior Court Case No. 61787 filed in Napa County; E. The Stipulation requires that the City utilize the Measure D monies " . . .only for waste reduction or recycling or for funding such programs in conjunction with reduction in rates. . . "; F. The CITY desires to offer subscribers who are eligible to receive Curbside Recycling service as of January 1, 1993 , a one-time credit equivalent to the cost of Recycling Services for a six month period; G. Beginning January 1, 1993 in accordance with the Recycling Agreement, the monthly cost will be $1. 34 per household per month. NOW, THEREFORE, CITY, OSC, AND LDD AGREE THAT THE AGREEMENT, DATED 4/24/90, IS AMENDED TO ADD THE FOLLOWING PROVISIONS: 1. In accordance with SECTION VI COMPENSATION FOR SERVICES, CITY shall incorporate $1. 34 per month in the rate schedule effective January 1, 1993 to accommodate curbside recycling services. 2 . On the residential garbage service bill covering the period from January 1993 through March 1993, OSC shall provide for a one-time credit for each account whose rate includes the Recycle America Curbside Recycling Program. (Accounts receiving single family service) 3 . The amount of the credit for each account shall be equal to the cost of recycling services for the six month period from January 1993 - ;June 1993 ($1. 34 x 6 months = $8. 04 per account) . 4 . Not later than February 15, 1993, OSC/LDD shall provide an invoice to CITY in sufficient detail to show the total number of accounts receiving the credit times the amount of the individual credit as defined in Section 3 above. The purpose of this invoice is to -1- allow CITY, using Measure D monies, to reimburse OSC/LDD for the total amount of credits granted to customers pursuant to this amendment. 5. CITY agrees to reimburse OSC/LDD in the amount of the invoice within 45 days of receipt of said invoice described in number 4 above, provided that in no event shall the amount of the credit granted by LDD or the reimbursement made by the City exceed the sum of $43 , 000 (forty-three thousand dollars) . - Said payment shall be made with Measure D Funds in accordance with all legal requirements. 6. OSC and LDD assume all costs associated with revisions to the billing to provide the one-time credit. In addition, LDD agrees to provide customers with a written explanation as shown in Exhibit A, attached hereto. In witness whereof, this Amendment is executed by the parties to the Agreement dated April 24, 1990 on this 14th day of December 1992 . Oakland Scavenger Company, Livermore Dublin Disposal, a California Corporation a wholly owned subsidiary of Oakland Scavenger Company D. David MacDonald Dan Borges Executive Vice President President/General Manager ATTEST: City of Dublin, a Municipal Corporation Kay Keck, City Clerk Peter W. Snyder, Mayor APPROVED AS TO FORM: Elizabeth Silver, City Attorney I a:recyamen.psr#13 -2- EXHIBIT A TO AGREEMENT CITY GRANTS SPECIAL RECYCLING CREDIT All current single family garbage customers in the City of Dublin will notice a credit of $8. 04 on the January 1993 quarterly bill. This represents the cost of curbside recycling charges for six months, which are part of your current garbage rate. In 1991 , a majority of voters in Alameda County adopted Measure D: Alameda County Waste Reduction and Recycling Initiative. Among other things, the measure placed a special surcharge on garbage disposed of in the landfill. This cost would require increased garbage rates in order to pay for the surcharge. A majority of Dublin voters (58%) voted against the measure. In early 1992, the Dublin City Council initiated a legal challenge to the measure in order to protect the interests of Dublin ratepayers. The City had already initiated its curbside recycling program prior to the election on Measure D. The money available for the one-time credit is the result of a Superior Court ruling which halted the collection of the Measure D surcharge. Funds already collected were returned to the cities and in accordance with legal documents must be used for Recycling or Source Reduction Programs. The Superior Court ruling has been appealed to the Court of Appeal. If the Court of Appeal holds the surcharge is valid, future rate adjustments will be required. a:recycred.psr#13 EXHIBIT 3 1992 SURVEY OF FRANCHISE FEES AND OTHER SURCHARGES LEVIED BY AGENCIES SERVICED BY OAKLAND SCAVENGER COMPANY Fremont 20.000% Newark 20.000% Union City 20.000% Alameda 16.882% (+ $6/ton Recycling Fee)* Hayward 14.00% Oakland Commercial 13 .34% (+ $6/ton Recycling Fee)** Residential 8. 44% (+ $6/ton Recycling Fee)** (Company collects street sweeping fees) Emeryville 12 .6% (+ $1 , 000 per month) ' Oro Loma Sanitary District 11 .5326% Castro Valley Sanitary 10.00% District City of Livermore 10.00% Albany 7 .5% Piedmont 5.5% Dublin 4.8% If use Oakland Residential Rate, Average for All 13 Agencies = '12 . 4042% I If you exclude Lowest (City of Dublin) Average for .12 remaining = 13 .04% NOTES: * Based on preliminary estimates, the $6/ton fee equates to approximately an additional 6% for City of Alameda. ** Based on preliminary estimates, the $6/ton fee equates to approximately an additional 7% for City of Oakland. 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