ITEM 4. 11
CITY MANAGER' S REPORT
7UNE 13, 2022 CITY COUNCIL REGULAR MEETING
ITEM: AUTHORIZE AD7USTMENT TO THE REPUBLIC
SERVICES SOLID WASTE COLLECTION RATES FOR
FISCAL YEAR 2022- 2023
RECOMMENDATION: Adopt Resolution Authorizing an Increase to Republic Services Collection Rates Based on the
Consumer Price Index for San Francisco- OaklandSan 7ose for All Urban Consumers for Fiscal Year 2022- 2023
SUMMARY:
The City of Lathrop is responsible for the collection and the transport of solid waste within City limits. Since 2003, the City has contracted for these services with Lathrop Sunrise Sanitation, now doing business as Republic Services. The Agreement between the City of Lathrop and Republic Services allows for an annual rate adjustment based on the Consumer Price Index for All Urban Consumers ( CPI- U) for the San Francisco- Oakland- San Jose, California area, not to exceed 4. 0%.
On April 4, 2022, Republic Services submitted their annual CPI- U adjustment for commercial and residential rates. The current index is 5. 2% for the upcoming fiscal year beginning July 1, 2022 and is above the maximum threshold established in their contract of 4. 0%. The annual CPI- U increase of 4% would apply to all customer classes and amounts to approximately $ 90, 000.
As part of the established consumer rates, Republic Services collects a franchise fee from all customers to cover the cost of state mandated solid waste outreach.
Franchise fees are remitted to the City and staff uses those funds to maintain compliance with state regulations.
If approved, this item will adjust the annual CPI- U by 4% for the upcoming fiscal year beginning July 1, 2022 in accordance with the contract terms.
BACKGROUND:
The Lathrop Municipal Code Section 8. 16. 090 gives the City the exclusive right and duty to collect and transport solid waste or provide for the collection and transportation thereof within the City limits under such terms and conditions, as it deems necessary for the public health, safety and well- being, and it may contract for the provision of those services.
On October 21, 2003, City Council approved an Agreement between the City of Lathrop and Lathrop Sunrise Sanitation ( Agreement), now doing business as Republic Services, to provide the necessary collection, transportation and disposal of solid waste generated within the City limit and for compliance with the source reduction and recycling elements of the City' s Waste Management Plan.
CITY MANAGER' S REPORT PAGE 2
JUNE 13, 2022 CITY COUNCIL REGULAR MEETING
REPUBLIC SERVICES CPI- U ADJUSTMENT FOR FY 2022- 2023
On June 2, 2009, City Council approved Amendment No. 1 to the Agreement with Republic Services extending the contract term for an additional 5 years to June 30, 2014.
On June 2, 2014, City Council approved Amendment No. 2 to the Agreement with Republic Services extending the contract term for an additional 5 years to June 30, 2019.
On June 10, 2019, City Council approved Amendment No. 3 to the Agreement with Republic Services extending the contract term for an additional 5 years to June 30, 2024 with renewable language clause and rate increase adjustment.
Lathrop Municipal Code Section 8. 16. 170 and Section 26 of the Agreement provide the City Council shall determine the maximum solid waste collection rates.
Section 25 of the Agreement also provides collection rates shall be reviewed annually and any adjustment to the maximum solid waste collection rates is to be based on the Consumer Price Index for All Urban Consumers ( CPI- U) for the San FranciscoOakland- San Jose, California area, not to exceed 4. 0%.
For the 2021- 2022 fiscal year there was no rate adjustment for senior Citizen rates.
On April 4, 2022, staff received a request from Republic Services to adjust their commercial and residential rates. The proposed 4% increase is based on the annual CPI- U 5. 2% percentage change over the last year, ending February 1, 2022. The increase would apply to all customer classes effective on July 1, 2022.
CITY MANAGER' S REPORT PAGE 3
JUNE 13, 2022 CITY COUNCIL REGULAR MEETING
REPUBLIC SERVICES CPI- U AD7USTMENT FOR FY 2022- 2023
The maximum allowable rate request is as follows:
STANDARD RESIDENTIAL RATES:
Small - 30 al 35. 74 37. 17 1. 43
Medium - 60 al 38. 50 40. 04 1. 54
Lar e - 90 al 43. 71 45. 46 1. 75
SENIOR RESIDENTIAL RATES:
i
Small - 30 al 26. 60 27. 66 1. 06
Medium - 60 al 28. 57 29. 71 1. 14
Lar e - 90 al 32. 24 33. 53 1. 29
MOBILE HOME/ TRAILER PARK RATES:
Small - 30 al 29. 88 31. 08 1. 20
Medium - 60 al 30. 47 31. 69 1. 22
Lar e - 90 al 35. 06 36. 46 1. 40
SENIOR MOBILE HOME/ TRAILER PARK RATES;
Small - 30 al 22. 42 23. 32 0. 90
Medium - 60 al 22. 83 23. 74 0. 91
Lar e - 90 al 26. 12 27. 16 1. 04
COMMERCIAL RATES - CURRENT RATES:
1 Cu. Yd $ 90. 27 $ 137. 58 $ 184. 84 $ 232. 06 $ 279. 34 100 Ibs. 2 Cu. Yd 116. 06 178. 28 244. 87 302. 76 364. 98 200 Ibs. 3 Cu. Yd 147. 17 235. 13 339. 21 463. 01 586. 91 350 Ibs. 4 Cu. Yd $ 183. 64 $ 302. 76 $ 467. 53 $ 632. 39 $ 794. 23 400 Ibs. 5 Cu. Yd $ 227. 32 $ 436. 73 $ 646. 14 $ 855. 55 $ 1065. 00 600 Ibs. 6 Cu. Yd $ 269. 52 $ 525. 88 $ 782. 58 $ 1039. 22 $ 1, 295. 91 650 Ibs.
L . Cart $ 37. 85 N/ A N/ A N/ A N/ A N/ A
CITY MANAGER' S REPORT PAGE 4
JUNE 13, 2022 CITY COUNCIL REGULAR MEETING
REPUBLIC SERVICES CPI- U ADJUSTMENT FOR FY 2022- 2023
COMMERCIAL RATES - PROSED RATES:
s -
1 Cu. Yd $ 93. 88 $ 143. 08 $ 192. 23 $ 241. 34 $ 290. 51 100 Ibs. 2 Cu. Yd $ 120. 70 $ 185. 41 $ 254. 66 $ 314. 87 $ 379. 58 200 Ibs. 3 Cu. Yd $ 153. 03 $ 244. 54 $ 352. 78 $ 481. 53 $ 610. 39 350 Ibs. 4 Cu. Yd $ 190. 99 $ 314. 87 $ 486. 23 $ 657. 69 $ 826. 00 400 Ibs. 5 Cu. Yd $ 236. 41 $ 454. 20 $ 671. 99 $889. 77 $ 1, 080. 79 600 Ibs. 6 Cu. Yd 280. 30 546. 92 813. 88 1080. 79 1 347. 75 650 Ibs.
L . Cart $ 40. 00 N/ A N/ A N/ A N/ A N/ A
Weights in excess of these maximum amounts per bin per pick up will be charged an additional $ 8. 00 per extra 100 pounds.
FISCAL IMPACT:
No fiscal impact at this time. However, pursuant to Section 27 of the Agreement between the City of Lathrop and Lathrop Sunrise Sanitation, now doing business as Republic Services, and Lathrop Municipal Code Section 8. 16. 180, Republic Services shall remit to the City of Lathrop a Franchise Fee of seven ( 7%) percent and a AB939 Recycling Fee of three ( 3%) percent of the gross revenue collected within ten ( 10) days following the completion of each calendar month.
ATTACH M E NT:
A. Resolution Authorizing an Increase to Republic Services Collection Rates Based on the Consumer Price Index for San Francisco- Oakland- San Jose for All Urban Consumers for Fiscal Year 2022- 2023
B. Lett:er from Republic Services dated April 4, 2022
CITY MANAGER' S REPORT PAGE 5
JUNE 13, 2022 CITY COUNCIL REGULAR MEETING
REPUBLIC SERVICES CPI- U ADJUSTMENT FOR FY 2022- 2023
APPROVALS:
C
W ' U'''
Melissa Stathakopoul s Date
Recreation Manager
2O ZZ.
Tod Se ian Date
Director of Parks, Recreation
Maintenance Services
r
d a a- u` U l
Cari Jam es Date
Finance Dir ctor
zo z L
Salvador Navarrete Date
City Attorney
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St n J. Salvatore Date
City Manager
RESOLUTION NO. 22 —
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LATHROP
AUTHORIZING AN INCREASE TO REPUBLIC SERVICES COLLECTION RATES BASED ON THE CONSUMER PRICE INDEX FOR SAN FRANCISCO- OAKLANDSAN JOSE FOR ALL URBAN CONSUMERS FOR FISCAL YEAR 2022- 2023 WHEREAS, on October 21, 2003, City Council approved an Agreement between the City of Lathrop and Lathrop Sunrise Sanitation ( Agreement), now doing business as Republic Services, to provide the necessary collection, transportation and disposal of solid waste generated within the City limit and for compliance with the source reduction and recycling elements of the City' s Waste Management Plan; and WHEREAS, on June 2, 2009, City Council approved Amendment No. 1 to the Agreement with Republic Services extending the contract term for an additional 5 years to June 30, 2014; and
WHEREAS, on June 2, 2014 City Council approved Amendment No. 2 to the Agreement with Republic Services extending the contract term for an additional 5 years to June 30, 2019; and
WHEREAS, on June 10, 2019, City Council approved Amendment No. 3 to the Agreement with Republic Services extending the contract term for an additional 5 years to June 30, 2024 with renewable language clause and rate increase adjustment; and
WHEREAS, Lathrop Municipal Code Section 8. 16. 170 and Section 26 of the original Agreement provide the City Council shall determine the maximum solid waste collection rates; and
WHEREAS, Section 26 of the Agreement also provides collection rates shall be reviewed annually and any adjustment to the maximum solid waste collection rates is ta be based on the Consumer Price Index for All Urban Consumers ( CPI- U) for the San Francisco- Oakland- San ) ose, California area, not to exceed 4. 0%; and WHEREAS, on April 4, 2022, staff received a request from Republic Services to adjust their commercial and residential rates pursuant to Section 26 of the Agreement; and
WHEAREAS, there was no rate adjustment for senior citizen rates for Fiscal Year 21- 22; and
WHEREAS, the current index is 5. 2% for the upcoming fiscal year beginning July 1, 2022 and is above the maximum threshold established in their contract of
4. 0%; and
WHEREAS, the annual CPI- U increase of 4% would apply to all other customer rates; and
WHEREAS, as part of the established consumer rates, Republic Services collects a franchise fee from all customers to cover the cost of state mandated solid waste outreach and franchise fees are remitted to the City and staff uses those funds to maintain compliance with state regulations; and
WHEREAS, pursuant to Section 27 of the Agreement between the City of Lathrop and Republic Services and Lathrop Municipal Code Section 8. 16. 180 Republic Services shall remit to the City of Lathrop a Franchise Fee of seven ( 7%) percent and a AB939 Recycling Fee of three ( 3%) percent of the gross revenue collected within ten ( 10) days following the completion of each calendar month; NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Lathrop herbey authorizes to the extent that the solid waste hauler gives notice pursuant to Section 26 of the Agreement, and pursuant to Lathrop Municipal Code Section 8. 16. 170, the City' s franchised solid waste hauler shall not be permitted to charge fees any higher than specified for each customer type listed:
The maximum allowable rate request is as follows:
STANDARD RESIDENTIAL RATES:
Small — 30 al 35. 74 37. 17 1. 43
Medium — 60 al 38. 50 40. 04 1. 54
Lar e — 90 al 43. 71 45. 46 1. 75
SENIOR RESIDENTIAL RATES:
i - - -
Small — 30 al 26. 60 27. 66 1. 06
Medium — 60 al 28. 57 29. 71 1. 14
Lar e — 90 al 32. 24 33. 53 1. 29
MOBILE HOME/ TRAILER PARK RATES:
i - -
Small - 30 al 29. 88 31. 08 1. 20
Medium - 60 al 30. 47 31. 69 1. 22
Lar e - 90 al 35. 06 36. 46 1. 40
SENIOR MOBILE HOME/ TRAILER PARK RATES:
r - . - ' , r - - -
Small - 30 al 22. 42 23. 32 0. 90
Medium - 60 al 22. 83 23. 74 0. 91
Lar e - 90 al 26. 12 27. 16 1. 04
COMMERCIAL RATES - CURRENT RATES:
1 Cu. Yd $ 90. 27 $ 137. 58 $ 184. 84 $ 232. 06 $ 279. 34 100 Ibs. 2 Cu. Yd 116. 06 178. 28 244. 87 302. 76 364. 98 200 Ibs. 3 Cu. Yd 147. 17 235. 13 339. 21 463. 01 586. 91 350 Ibs. 4 Cu. Yd $ 183. 64 $ 302. 76 $ 467. 53 $ 632. 39 $ 794. 23 400 Ibs. 5 Cu. Yd $ 227. 32 $ 436. 73 $ 646. 14 $ 855. 55 $ 1065. 00 600 Ibs. 6 Cu. Yd $ 269. 52 $ 525. 88 $ 782. 58 $ 1039. 22 $ 1, 295. 91 650 Ibs.
L . Cart $ 37. 85 N/ A N/ A N/ A N/ A N/ A
COMMERCIAL RATES - PROSED RATES:
1 Cu. Yd 93. 88 143. 08 192. 23 241. 34 290. 51 100 Ibs. 2 Cu. Yd 120. 70 185. 41 254. 66 314. 87 379. 58 200 Ibs. 3 Cu. Yd $ 153. 03 $ 244. 54 $ 352. 78 $ 481. 53 $ 610. 39 350 Ibs. 4 Cu. Yd $ 190. 99 $ 314. 87 $ 486. 23 $ 657. 69 $ 826. 00 400 Ibs. 5 Cu. Yd $ 236. 41 $ 454. 20 $ 671. 99 $ 889. 77 $ 1, 080. 79 600 Ibs. 6 Cu. Yd $ 280. 30 $ 546. 92 $ 813. 88 $ 1080. 79 $ 1, 347. 75 650 Ibs.
L . Cart $ 40. 00 N/ A N/ A N/ A N/ A N/ A
Weights in excess of these maximum amounts per bin per pick up will be charged an additional $ 8. 00 per extra 100 pounds.
The foregoing resolution was passed and adopted this 13t" day of June 2022, by the following vote of the City Council, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
Sonny Dhaliwal, Mayor
ATTEST: APPROVED AS TO FORM:
Teresa Vargas, City Clerk Salvador Navarrete, City Attorney ATTACHMENT " J "
1 1 ` . r r er` ; t;. i ' 70c
R lU %=( t `.) ZTZ) 1 = f> > 1. i1 ( ( Jr^il titl`JICES. C41; 1 SERV7CFS
April 4, 2022
Teresa Vargas
City of Lathrop
390 Towne Centre Dr.
Lathrop, CA 95330
Dear Ms. Vargas,
Pursuant to Section 26 of the " Agreement Between the City of Lathrop and Lathrop Sunrise Sanitation Corporation" the collection rates shall be reviewed annually during the month of May and adjusted effective July 1. The agreement allows for an adjustment based on the prior year change in the Consumer Price Index for the San Francisco- Oakland-San Jose, all urban consumer as published by the United States Department of Labor, Bureau of Labor Statistics. The change in the CPI for the period February 1, 2021 through February 1, 2022 was 5. 2%. Per Section 26 " Any CPI rate adjustment in any given year shall not exceed 4%." Therefore, the calculation of the change in CFI rate adjustment for the prior year has been adjusted to 4%.
Attached please find the proposed new collection rates effective July 1, 2022 with the 4% CPI rate adjustment. Thank you for the continued confidence in Republic Services of Lathrop, as always we will continue to strive to provide professional solid waste services. Should you have any questions, please do not hesitate to call me at( 209) 547- 7531.
Sincerely,
Republic Services of Lathrop
1/ j
jV'
f
Molly Gomez
Municipal Manager
Enclosure
R
REPUBL/ C'
SERV/CES
Lathrop Sunrise Sanitation Rates Effective 8/ 1/ 21 ( Current) 2 YD 11 b.06 178. 2$ 244. 87 302. 76 364. 98
1 4 YD 183. 64 302. 76 467. 53 632. 39 794. 23
1. 1
6 YD 269. 52 525. 88 782. 58 1, 039. 22 1, 295. 91
Residential S ervice Weekly Recycling and Green Waste
1 •
60 gallon 38. 50 28. 57 30. 47 22. 83
Lathrop Sunrise Sanitation Rates Effective 7/ 1/ 2022
2 YD 120. 70 185. 41 254. 66 314. 87 379. 58
1 •
4 YD 190. 99 314. 87 486. 23 657. 69 826. 00
6 YD 280. 30 546. 92 813. 88 1, Q8Q. 79 1, 347. 75
11 Ftesidential SE rvice Weekly Recycling and Green Waste 60 gallon 40.Q4 29. 71 31. 69 23. 74
Weights in excess€ f
these tnaximurrr amounts per bin per pick up wilt be charged an additiona!$ S. Qt1 per e.rtra IQ(1 pounds.