The Parties:
City of Hercules
Republic Services
Subject:
Side Letter Agreement Regarding Use of City Rate Stabilization Funds to Offset Maximum Service Rates Effective July 1, 2025, through December 31, 2026 Content:
The City of Hercules and Republic Services (collectively the “Parties”) hereby agree that the Maximum Service Rates effective July 1, 2025, through December 31, 2026, shall be offset by the City’s use of $243,000 in rate stabilization funds. Republic Services has calculated Service Rates net of the City’s use rate stabilization funds, summarized in Table 1, below, and included in their entirely as Attachment 1 to this Side Letter Agreement.
Table 1 – Service Rates Net of Rate Stabilization Funding (July 1, 2025, through December 32, 2026) 20-Gallon
32-Gallon
Maximum Service Rates Per Solid Waste Collection Agreement $ 38.05
$ 39.48
Rate Stabilization Funding Offset to Maximum Service Rates $ (2.04)
$ (2.12)
Service Rates Net of Rate Stabilization Funding
$ 36.01
$ 37.36
Via this Side Letter Agreement, for the period from July 1, 2025, through December 31, 2026, the City agrees to pay Republic Service the difference between the Maximum Service Rates included in the Agreement, and the Service Rates net of rate stabilization funding. Republic Services shall invoice the City monthly starting on July 1, 2025, for the amount owed by the City. Given current subscription levels by size, the monthly amount owed is estimated to be $13,496.44, calculated as shown in Table 2, below.
Table 2 – Calculation of Monthly Rate Stabilization Amounts Payable by City to Republic Services 20-Gallon
32-Gallon
Rate Stabilization Funding Offset to Maximum Service Rates $ 2.04
$ 2.12
Number of Monthly Subscriptions (as of November 2024)
1,186
5,225
Monthly Total
Rate Stabilization Offset Times Number of Monthly Subscriptions $2,419.44
$11,077.00
$13,496.44
Provided that the City pays Republic Services the monthly amounts owed as described above from July 1, 2025, through December 31, 2026, Republic Services shall bill City Services Recipients at the Service Rates net of rate stabilization funding shown in Attachment 1 to this Side Letter Agreement and shall not bill Service Recipients at the Maximum Service Rates included as to the Agreement. The Parties agree that monthly invoicing and payment shall proceed for the 18 months from July 1, 2025, through December 31, 2026. The Parties further agree and understand that the total 18-month amounts owed pursuant to the calculations described above may be more than the available $243,000 in City rate stabilization funding. Any remaining amount owed above $243,000 at the conclusion of 18 months shall be deducted from Republic Services monthly Franchise Fee payment to the City in January 2027.
If the City does not pay the monthly amounts described herein, Republic Services may bill customers at the Maximum Service Rates per to the Agreement, including retroactive prorated amounts if necessary and applicable to billing cycles for which the City did not pay rate stabilization funding invoices.
Starting January 1, Republic Services shall commence billing Service Recipients based on the Maximum Service Rates in as adjusted in accordance with of the Agreement.
Signature Block:
Republic Services: _________________________________
City of Hercules : __________________________________