June 20, 2023
HONORABLE MAYOR AND CITY COUNCIL
City of Long Beach
California
RECOMMENDATION:
Receive the supporting documentation into the record; receive public comment pursuant to Proposition 218; direct the City Clerk to tabulate the written protests and report the results of the tabulation to the Mayor and City Council during the June 20, 2023 hearing; and, if a “majority protest” is not established, conclude the public hearing and adopt a Resolution establishing Solid Waste Service Rates under a two-step rate adjustment. (Citywide)
DISCUSSION
The City of Long Beach (City) last raised solid waste collection rates for cost of service on September 1, 2022. That increase was the first part of a proposed two-step rate adjustment proposed during a Proposition 218 hearing on August 23, 2022. As directed by the City Council on August 23, 2022, City staff are returning to the City Council with a recommendation to phase-in a second rate adjustment in two parts. The first part is proposed to be effective July 1, 2023, and the second part is proposed to be effective October 1, 2023. As discussed during the hearing on August 23, 2022, costs associated with solid waste collection continue to increase. Solid waste disposal costs have increased since the September 1, 2022 rate adjustment and City staff anticipates continued cost increases in the coming years. Costs of acquiring collection vehicles and maintaining a fleet are also continuing to increase. The City is adding eight refuse collection trucks this fiscal year to provide citywide commercial organics collection.
Additionally, over the past few years, the State has enacted legislation increasing each city’s requirement to recycle and provide waste diversion programs. In response to these and other requirements, the Public Works Department is currently working towards implementing a plan that will satisfy all of the State’s requirements. This plan will develop a path for the City’s compliance with current and upcoming legislation including, but not limited to, Assembly Bill (AB) 341 (mandatory commercial and multi- family recycling and sets a statewide 70 percent diversion target), AB 2176 (large venue and special event recycling), AB 1826 (commercial organics recycling), and SB 1383 (short-lived climate pollutants: organics methane emissions reductions).
After the hearing on August 23, 2022, Public Works Department retained Hilton, Farnkopf, and Hobson Consultants, LLC (HF&H), to modify the previously submitted Cost of Service Study (Study) for refuse, recycling and commercial organics collection services (Attachment A) to modify the rate adjustment’s second step to be split into two phases. The objective of the Study was to develop recommendations for an updated rate structure that reflect current costs of service, and include costs for administering programs to meet requirements, ensure compliance of State mandated programs, and Department of Public Works
411 West Ocean Boulevard, 5th Floor Long Beach, CA 90802 (562) 570-6383
H-1
HONORABLE MAYOR AND CITY COUNCIL
June 20, 2023
reflect commercial organics collection scheduled for implementation in 2023.
The Study concluded that rate increases for solid waste services are necessary for several reasons including: (1) solid waste collection costs have increased; (2) the City’s rates have not generated sufficient revenue to cover the costs for service; and, (3) compliance with and implementation of new State-mandated (SB 1383) diversion programs require additional funding. The Study was issued and made available for review on May 5, 2023, on the LB Recycles website (www.longbeach.gov/lbrecycles).
The updated rate structure is designed for each rate class to ensure customers are paying their proportionate share of costs. The proposed rate adjustment is recommended for implementation in two phases with the first adjustment taking effect on July 1, 2023, increasing the typical single family home customer’s account by $3.90 per month. The proposed second phase will go into effect on October 1, 2023, adding $4.34 per month.
Public Works intends to perform another Study to determine the necessary rate increases for Fiscal Year 2024 (FY 24) to account for unanticipated commercial organic program costs and new residential organics program costs, as these are not included in the proposed rates discussed and requested herein.
These proposed solid waste rates are used solely for the purpose of defraying costs incurred in providing efficient services and to ensure continued compliance with State law. Long Beach rates will still be lower than many comparable California cities’ current rates after the proposed rates go into effect (see chart below).
Since the rates are based on actual cost of service, not all residential and commercial rates will be adjusted equally. Further, commercial accounts will see their rates increase at a higher rate than residential accounts due to the implementation of commercial $26.46 $34.42 $35.31 $38.32 $40.99 $42.66 $43.46 $53.90 $55.03 $96.73
$144.68 $148.29
$(10.00)
$10.00
$30.00
$50.00
$70.00
$90.00
$110.00
$130.00
$150.00
Residential Solid Waste Rates Comparison
HONORABLE MAYOR AND CITY COUNCIL
June 20, 2023
organics collection. The following charts summarize the rates subject to this majority protest process.
Cart Rates:
Bin Rates:
SOLID WASTE Current Rates
Proposed Rates
JULY 1, 2023
Proposed Rates
OCT 1, 2023
64 gallon carts 29.06 32.36 36.03
100 gallon carts 34.42 38.32 42.66
CURRENT RATES
Collection
Frequency 2-yard 3-yard 4-yard
1x week 142.84$ 183.26$ 287.37$
2x week 264.53$ 386.31$ 530.79$
3x week 386.31$ 508.02$ 774.34$
4x week 508.02$ 936.95$ 1,017.75$
5x week 629.73$ 1,082.26$ 1,261.17$
6x week 936.95$ 1,302.13$ 1,875.60$
Container Size
PROPOSED 7/1/2023
Collection
Frequency 2-yard 3-yard 4-yard
1x week 176.87$ 227.09$ 356.43$
2x week 328.07$ 479.36$ 658.85$
3x week 479.36$ 630.57$ 961.44$
4x week 630.57$ 1,163.47$ 1,263.86$
5x week 781.79$ 1,344.01$ 1,566.28$
6x week 1,163.47$ 1,617.18$ 2,329.65$
Container Size
HONORABLE MAYOR AND CITY COUNCIL
June 20, 2023
Proposition 218 Requirements
The substantive provisions of Article XIII D appear in section 6, subdivisions (b)(1)–(5), which require a property-related fee to satisfy these standards:
1. Revenues derived from the fee or charge must not exceed the funds required to provide the property-related service;
2. Revenues derived from the fee or charge must not be used for any purpose other than that for which the fee is imposed;
3. The amount of a fee or charge imposed upon any parcel or person as an incident of property ownership must not exceed the proportional cost of the service attributable to the parcel;
4. The fee or charge may not be imposed for a service unless the service is actually used by, or immediately available to, the owner of the property subject to the fee or charge; fees or charges based on potential or future use of a service are not permitted, and stand-by charges must be classified as assessments subject to the ballot protest and proportionality requirements for assessments; and,
5. No fee or charge may be imposed for general governmental services, such as police, fire, ambulance, or libraries, where the service is available to the public in substantially the same manner as it is to property owners.
Procedurally, Proposition 218 requires that notices of a proposed rate increase be mailed to all property owners in the affected area, and that a public hearing be held not less than 45 days after the mailing. On May 5, 2023, 118,512 notices of the proposed rate increase were mailed to all property owners and refuse customers in Long Beach.
The notices informed customers of the proposed increases and of their opportunity to submit a written protest. The protest period will close at the public hearing. Absent a majority protest (i.e., 50 percent + 1, or 59,257 protests), the City Council may approve the final adoption of the proposed rates at this hearing. The first rate increase would become effective on July 1, 2023.
City staff recommends that the City Council holds a public hearing, hears all public PROPOSED 10/1/2023
Collection
Frequency 2-yard 3-yard 4-yard
1x week 219.07$ 281.46$ 442.17$
2x week 406.92$ 594.89$ 817.89$
3x week 594.89$ 782.75$ 1,193.82$
4x week 782.75$ 1,444.83$ 1,569.55$
5x week 970.63$ 1,669.12$ 1,945.27$
6x week 1,444.83$ 2,008.51$ 2,893.69$
Container Size
HONORABLE MAYOR AND CITY COUNCIL
June 20, 2023
comments on the proposed rate increases, considers all written material and written protest concerning the establishment and imposition of the proposed rate increases, tabulates the protests received, and if no majority protest exists, adopts the attached Resolution to revise refuse and recycling rates as proposed.
This matter was reviewed by Deputy City Attorney Vanessa Ibarra on June 2, 2023, and by Budget Management Officer Nader Kaamoush on June 5, 2023.
TIMING CONSIDERATIONS
City Council action is requested on June 20, 2023, to implement the solid waste rate changes effective July 1, 2023, and October 1, 2023.
FISCAL IMPACT
The rate increases are proposed to take effect in a two-phase adjustment with the first effective July 1, 2023, which will increase the typical (96-gallon cart) single family home customer’s account by $3.90 per month, or 11 percent. The second adjustment will go into effect on October 1, 2023, adding $4.34 per month, or 11 percent. It is estimated that adjusting rates, for both residential and commercial accounts, will allow for expected acquisition of vehicles and equipment for the State mandated commercial organics collection program. Since 2012, due to increased operational costs, the Refuse/Recycling Fund Group balance has decreased by over $15 million. Without a rate increase, it is estimated that the Refuse/Recycling Fund Group will be exhausted by mid FY 24. The proposed rate adjustment is anticipated to generate an estimated surplus in the Refuse/Recycling Fund Group of $250,000 in FY 23. For FY 24, revenues generated by the rate adjustment was estimated at the time of the study to generate an additional $7.8 million surplus which is necessary to apply towards acquiring equipment required to implement State mandated programs. Staff will be returning to City Council as part of the FY 24 Budget process to appropriate these additional needs to continue the implementation of the State mandated program. This recommendation has no staffing impact beyond the normal budgeted scope of duties and is consistent with existing City Council priorities. There is no local job impact associated with this recommendation.
SUGGESTED ACTION:
Approve recommendation.
Respectfully submitted,
ERIC LOPEZ
DIRECTOR OF PUBLIC WORKS
ATTACHMENTS: RESOLUTION
APPROVED:
THOMAS B. MODICA
CITY MANAGER
HONORABLE MAYOR AND CITY COUNCIL
June 20, 2023
A – COST OF SERVICE AND RATE STUDY
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OFFICE OF THE CITY ATTORNEY
DAWN MCINTOSH, City Attorney
411 West Ocean Boulevard, 9th Floor
Long Beach, CA 90802-4664
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF LONG BEACH ESTABLISHING SOLID WASTE
SERVICE RATES
WHEREAS, the City of Long Beach’s (“City’s”) Department of Public Works engaged HF&H Consultants, LLC (HF&H) to conduct a comprehensive Cost of Service and Rate Structure Study (the “Study”) for solid waste collection services; and WHEREAS, the City requested HF&H to prepare an analysis of the current solid waste rates, rate structure, and operating costs, and evaluate if, and to what extent, a rate increase may be necessary to cover the City’s operational costs of its solid waste enterprise; and
WHEREAS, the Study concluded that rate increases for solid waste services (collectively herein, the “Charges”) are necessary for several reasons: 1) in recent years, the City’s rates have not generated revenues sufficient to cover costs, resulting in drawing down reserves, 2) the cost of collection of solid waste has increased , and 3) additional costs to comply with new State-mandated diversion programs such as regulations implementing Senate Bill 1383 (Chapter 395, Statutes of 2016) requiring the collection of organic materials; and
WHEREAS, the Study propose d a two -step rate increase, with the first increase taking effect on July 1, 2023, and the second increase taking effect on October 1, 2023; and
WHEREAS, pursuant to Article XIII D, section 6 of the California Constitution, the City provided written notice by mail of the new or increased Charges to the record owner of each parcel upon which the Charges are proposed for imposition not less than 45 days prior to the public hearing on the proposed rate increases; and WHEREAS, the City Council of the City of Long Beach held a public hearing
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OFFICE OF THE CITY ATTORNEY
DAWN MCINTOSH, City Attorney
411 West Ocean Boulevard, 9th Floor
Long Beach, CA 90802-4664
on June 20, 2023, to consider all protests against the proposed rate increases; and WHEREAS, at the public hearing the City Council heard all oral testimony, and considered all written materials and written protests concerning the establishment and imposition of the proposed rate increases to the Charges; and WHEREAS, the total number of written protests presented by the close of the public hearing was less than a majority of the total number of property owners or property upon which the Charges are proposed for imposition or any te nants directly liable for the payment of the Charges; and
WHEREAS, the City Council now desires to establish and impose the proposed Charges.
NOW, THEREFORE, the City Council of the City of Long Beach resolves as follows:
Section 1. The above recitals are all true and correct and are incorporated herein.
Section 2. The City Council hereby adopts the Charges for solid waste collection services at the maximum rates, with an effective date, as set forth in Exhibit “A” attached hereto and incorporated herein by this reference.
Section 3. To the extent any Charges established by this Resolution are inconsistent with any Charges previously adopted by the City Council, it is the explicit intention of the City Council that the Charges adopted pursuant to this Resolution shall prevail.
Section 4. This resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting this resolution. ///
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OFFICE OF THE CITY ATTORNEY
DAWN MCINTOSH, City Attorney
411 West Ocean Boulevard, 9th Floor
Long Beach, CA 90802-4664
I hereby certify that the foregoing resolution was adopted by the City Council of the City of Long Beach at its meeting of ______________________2023, by the following vote:
Ayes: Councilmembers:
Noes: Councilmembers:
Absent: Councilmembers:
Recusal(s): Councilmembers:
City Clerk
EXHIBIT "A"
Dwelling Type Current Total
30-Day Bill July 1, 2023 October 1, 2023
Single Family 34.42$ 38.32$ 42.66$
Duplex 31.74$ 35.34$ 39.34$
Apartments (1-10 Units) 29.06$ 32.36$ 36.03$
Apartments (11+ Units) 29.06$ 32.36$ 36.03$
Automated Cart Collection
(Standard)
Current Total
30-Day Bill July 1, 2023 October 1, 2023
32 Gallon 12.13$ 13.49$ 15.01$
64 Gallon 24.25$ 26.98$ 30.02$
64 Gallon with Recycling 29.06$ 32.36$ 36.03$
64 Gallon with additional 96 Gallon 14.90$ 16.57$ 18.44$ 96 Gallon 29.61$ 32.94$ 36.65$
96 Gallon with Recycling 34.42$ 38.32$ 42.66$
Automated Cart Collection (Exempt
Utility User's Tax Rates)
Current Total
30-Day Bill July 1, 2023 October 1, 2023
32 Gallon 7.95$ 8.85$ 9.84$
64 Gallon 15.91$ 17.70$ 19.69$
64 Gallon with Recycling 19.82$ 22.07$ 24.58$
96 Gallon 19.48$ 21.68$ 24.12$
96 Gallon with Recycling 23.39$ 26.05$ 29.00$
RATE RESOLUTION
EXEMPT UTILITY USER'S TAX RATES
RESIDENTIAL REFUSE AND RECYCLING RATES
Manual - 50 Gallon Cans Current Total
30-Day Bill July 1, 2023 October 1, 2023
1-2 Cans per Week 40.44$ 49.65$ 61.01$
3-7 Cans per Week 94.35$ 116.63$ 144.23$
6-10 Cans per Week 183.24$ 227.06$ 281.43$
11-15 Cans per Week 272.39$ 337.83$ 419.04$
16-20 Cans per Week 361.33$ 448.32$ 556.32$
21-30 Cans per Week 604.63$ 750.60$ 931.87$
31-40 Cans per Week 847.71$ 1,052.61$ 1,307.09$
41-50 Cans per Week 1,090.87$ 1,354.71$ 1,682.41$ 51-60 Cans per Week 1,333.96$ 1,656.72$ 2,057.64$ 61-70 Cans per Week 1,576.91$ 1,958.56$ 2,432.65$ 71-80 Cans per Week 1,820.20$ 2,260.83$ 2,808.18$ 81-90 Cans per Week 2,063.42$ 2,563.01$ 3,183.61$ 91-100 Cans per Week 2,306.50$ 2,865.01$ 3,558.81$ 101-125 Cans per Week 2,914.53$ 3,620.41$ 4,497.33$ 126-150 Cans per Week 3,522.22$ 4,375.41$ 5,435.34$ 151-175 Cans per Week 4,129.77$ 5,130.23$ 6,373.13$ 176-200 Cans per Week 4,737.91$ 5,885.79$ 7,311.84$ 201-225 Cans per Week 5,345.80$ 6,641.03$ 8,250.14$ 226-250 Cans per Week 5,953.49$ 7,396.02$ 9,188.14$ 251-275 Cans per Week 6,565.31$ 8,156.14$ 10,132.52$ 276-300 Cans per Week 7,169.18$ 8,906.40$ 11,064.64$ 301-325 Cans per Week 7,776.88$ 9,661.40$ 12,002.65$ 326-350 Cans per Week 8,384.76$ 10,416.63$ 12,940.95$ 351-375 Cans per Week 8,992.64$ 11,171.87$ 13,879.26$ 376-400 Cans per Week 9,600.66$ 11,927.27$ 14,817.77$ MANUAL 50 GALLON CANS COMMERCIAL REFUSE, RECYCLING AND ORGANICS RATES Bin Service Current Total
30-Day Bill July 1, 2023 October 1, 2023
2 yd Bin 1 Time per Week 142.84$ 176.87$ 219.07$
2 yd Bin 2 Times per Week 264.53$ 328.07$ 406.92$ 2 yd Bin 3 Times per Week 386.31$ 479.36$ 594.89$ 2 yd Bin 4 Times per Week 508.02$ 630.57$ 782.75$ 2 yd Bin 5 Times per Week 629.73$ 781.79$ 970.63$ 2 yd Bin 6 Times per Week 936.95$ 1,163.47$ 1,444.83$ 2 yd Bin 7 Times per Week 1,058.65$ 1,314.68$ 1,632.68$ 2 yd Bin 8 Times per Week 1,180.42$ 1,465.97$ 1,820.65$ 2 yd Bin 9 Times per Week 1,302.13$ 1,617.18$ 2,008.51$ 2 yd Bin 10 Times per Week 1,423.84$ 1,768.39$ 2,196.37$ 2 yd Bin 11 Times per Week 1,747.50$ 2,170.51$ 2,695.97$ 2 yd Bin 12 Times per Week 1,869.20$ 2,321.71$ 2,883.82$ 2 yd Bin 13 Times per Week 1,990.91$ 2,472.92$ 3,071.68$ 2 yd Bin 14 Times per Week 2,112.69$ 2,624.21$ 3,259.65$ 2 yd Bin 15 Times per Week 2,234.39$ 2,775.42$ 3,447.51$ 2 yd Bin 16 Times per Week 2,557.92$ 3,177.38$ 3,946.90$ 2 yd Bin 17 Times per Week 2,679.63$ 3,328.58$ 4,134.75$ 2 yd Bin 18 Times per Week 2,801.34$ 3,479.80$ 4,322.63$ 2 yd Bin 19 Times per Week 2,923.11$ 3,631.09$ 4,510.59$ 2 yd Bin 20 Times per Week 3,044.82$ 3,782.29$ 4,698.45$ 2 yd Bin 21 Times per Week 3,368.35$ 4,184.24$ 5,197.83$ 2 yd Bin 22 Times per Week 3,490.05$ 4,335.45$ 5,385.70$ 2 yd Bin 23 Times per Week 3,611.76$ 4,486.67$ 5,573.56$ 2 yd Bin 24 Times per Week 3,733.47$ 4,637.87$ 5,761.42$ 2 yd Bin 25 Times per Week 3,855.24$ 4,789.16$ 5,949.38$ 2 yd Bin 26 Times per Week 4,178.71$ 5,191.04$ 6,448.67$ 2 yd Bin 27 Times per Week 4,300.48$ 5,342.32$ 6,636.63$ 2 yd Bin 28 Times per Week 4,422.19$ 5,493.54$ 6,824.50$ 2 yd Bin 29 Times per Week 4,543.89$ 5,644.74$ 7,012.35$ 2 yd Bin 30 Times per Week 4,665.67$ 5,796.04$ 7,200.33$ 2 yd Bin 31 Times per Week 4,989.26$ 6,198.07$ 7,699.81$ 2 yd Bin 32 Times per Week 5,150.27$ 6,398.10$ 7,948.33$ 2 yd Bin 33 Times per Week 5,311.26$ 6,598.12$ 8,196.84$ 2 yd Bin 34 Times per Week 5,472.26$ 6,798.15$ 8,445.35$ 2 yd Bin 35 Times per Week 5,633.26$ 6,998.17$ 8,693.86$ 2 yd Bin 36 Times per Week 5,794.26$ 7,198.20$ 8,942.37$ 2 yd Bin 37 Times per Week 5,955.26$ 7,398.23$ 9,190.89$ 2 yd Bin 38 Times per Week 6,116.26$ 7,598.26$ 9,439.40$ 2 yd Bin 39 Times per Week 6,277.25$ 7,798.27$ 9,687.90$ 2 yd Bin 40 Times per Week 6,438.26$ 7,998.30$ 9,936.42$ 2 YARD BIN COMMERCIAL REFUSE, RECYCLING AND ORGANICS RATES Bin Service Current Total
30-Day Bill July 1, 2023 October 1, 2023
3 yd Bin 1 Time per Week 183.26$ 227.09$ 281.46$
3 yd Bin 2 Times per Week 386.31$ 479.36$ 594.89$ 3 yd Bin 3 Times per Week 508.02$ 630.57$ 782.75$ 3 yd Bin 4 Times per Week 936.95$ 1,163.47$ 1,444.83$ 3 yd Bin 5 Times per Week 1,082.26$ 1,344.01$ 1,669.12$ 3 yd Bin 6 Times per Week 1,302.13$ 1,617.18$ 2,008.51$ 3 yd Bin 7 Times per Week 1,564.44$ 1,943.08$ 2,413.40$ 3 yd Bin 8 Times per Week 1,975.15$ 2,453.34$ 3,047.36$ 3 yd Bin 9 Times per Week 2,216.70$ 2,753.44$ 3,420.20$ 3 yd Bin 10 Times per Week 2,537.66$ 3,152.20$ 3,915.62$ 3 yd Bin 11 Times per Week 2,622.11$ 3,257.12$ 4,045.98$ 3 yd Bin 12 Times per Week 2,804.66$ 3,483.93$ 4,327.76$ 3 yd Bin 13 Times per Week 2,987.23$ 3,710.74$ 4,609.55$ 3 yd Bin 14 Times per Week 3,169.89$ 3,937.68$ 4,891.50$ 3 yd Bin 15 Times per Week 3,352.44$ 4,164.49$ 5,173.29$ 3 yd Bin 16 Times per Week 3,837.74$ 4,767.42$ 5,922.37$ 3 yd Bin 17 Times per Week 4,020.30$ 4,994.23$ 6,204.16$ 3 yd Bin 18 Times per Week 4,202.87$ 5,221.05$ 6,485.97$ 3 yd Bin 19 Times per Week 4,385.53$ 5,447.99$ 6,767.91$ 3 yd Bin 20 Times per Week 4,568.08$ 5,674.80$ 7,049.70$ 3 yd Bin 21 Times per Week 5,053.38$ 6,277.73$ 7,798.78$ 3 yd Bin 22 Times per Week 5,235.94$ 6,504.54$ 8,080.57$ 3 yd Bin 23 Times per Week 5,418.50$ 6,731.36$ 8,362.36$ 3 yd Bin 24 Times per Week 5,601.06$ 6,958.17$ 8,644.15$ 3 yd Bin 25 Times per Week 5,783.72$ 7,185.11$ 8,926.10$ 3 yd Bin 26 Times per Week 6,268.92$ 7,787.92$ 9,675.04$ 3 yd Bin 27 Times per Week 6,451.57$ 8,014.85$ 9,956.97$ 3 yd Bin 28 Times per Week 6,634.14$ 8,241.67$ 10,238.78$ 3 yd Bin 29 Times per Week 6,816.70$ 8,468.48$ 10,520.57$ 3 yd Bin 30 Times per Week 6,999.36$ 8,695.41$ 10,802.51$ 3 yd Bin 31 Times per Week 7,484.76$ 9,298.47$ 11,551.75$ 3 yd Bin 32 Times per Week 7,726.26$ 9,598.52$ 11,924.52$ 3 yd Bin 33 Times per Week 7,967.75$ 9,898.55$ 12,297.29$ 3 yd Bin 34 Times per Week 8,209.25$ 10,198.59$ 12,670.05$ 3 yd Bin 35 Times per Week 8,450.75$ 10,498.62$ 13,042.82$ 3 yd Bin 36 Times per Week 8,692.25$ 10,798.66$ 13,415.59$ 3 yd Bin 37 Times per Week 8,933.75$ 11,098.70$ 13,788.35$ 3 yd Bin 38 Times per Week 9,175.24$ 11,398.73$ 14,161.11$ 3 yd Bin 39 Times per Week 9,416.75$ 11,698.78$ 14,533.90$ 3 yd Bin 40 Times per Week 9,658.25$ 11,998.82$ 14,906.66$ 3 YARD BIN COMMERCIAL REFUSE, RECYCLING AND ORGANICS RATES Dwelling Type Current Total
30-Day Bill July 1, 2023 October 1, 2023
Single Family 34.42$ 38.32$ 42.66$
Duplex 31.74$ 35.34$ 39.34$
Apartments (1-10 Units) 29.06$ 32.36$ 36.03$
Apartments (11+ Units) 29.06$ 32.36$ 36.03$
Automated Cart Collection
(Standard)
Current Total
30-Day Bill July 1, 2023 October 1, 2023
32 Gallon 12.13$ 13.49$ 15.01$
64 Gallon 24.25$ 26.98$ 30.02$
64 Gallon with Recycling 29.06$ 32.36$ 36.03$
64 Gallon with additional 96 Gallon 14.90$ 16.57$ 18.44$ 96 Gallon 29.61$ 32.94$ 36.65$
96 Gallon with Recycling 34.42$ 38.32$ 42.66$
Automated Cart Collection (Exempt
Utility User's Tax Rates)
Current Total
30-Day Bill July 1, 2023 October 1, 2023
32 Gallon 7.95$ 8.85$ 9.84$
64 Gallon 15.91$ 17.70$ 19.69$
64 Gallon with Recycling 19.82$ 22.07$ 24.58$
96 Gallon 19.48$ 21.68$ 24.12$
96 Gallon with Recycling 23.39$ 26.05$ 29.00$
RATE RESOLUTION
EXEMPT UTILITY USER'S TAX RATES
RESIDENTIAL REFUSE AND RECYCLING RATES
Manual - 50 Gallon Cans Current Total
30-Day Bill July 1, 2023 October 1, 2023
1-2 Cans per Week 40.44$ 49.65$ 61.01$ 3-7 Cans per Week 94.35$ 116.63$ 144.23$ 6-10 Cans per Week 183.24$ 227.06$ 281.43$ 11-15 Cans per Week 272.39$ 337.83$ 419.04$ 16-20 Cans per Week 361.33$ 448.32$ 556.32$ 21-30 Cans per Week 604.63$ 750.60$ 931.87$ 31-40 Cans per Week 847.71$ 1,052.61$ 1,307.09$ 41-50 Cans per Week 1,090.87$ 1,354.71$ 1,682.41$ 51-60 Cans per Week 1,333.96$ 1,656.72$ 2,057.64$ 61-70 Cans per Week 1,576.91$ 1,958.56$ 2,432.65$ 71-80 Cans per Week 1,820.20$ 2,260.83$ 2,808.18$ 81-90 Cans per Week 2,063.42$ 2,563.01$ 3,183.61$ 91-100 Cans per Week 2,306.50$ 2,865.01$ 3,558.81$ 101-125 Cans per Week 2,914.53$ 3,620.41$ 4,497.33$ 126-150 Cans per Week 3,522.22$ 4,375.41$ 5,435.34$ 151-175 Cans per Week 4,129.77$ 5,130.23$ 6,373.13$ 176-200 Cans per Week 4,737.91$ 5,885.79$ 7,311.84$ 201-225 Cans per Week 5,345.80$ 6,641.03$ 8,250.14$ 226-250 Cans per Week 5,953.49$ 7,396.02$ 9,188.14$ 251-275 Cans per Week 6,565.31$ 8,156.14$ 10,132.52$ 276-300 Cans per Week 7,169.18$ 8,906.40$ 11,064.64$ 301-325 Cans per Week 7,776.88$ 9,661.40$ 12,002.65$ 326-350 Cans per Week 8,384.76$ 10,416.63$ 12,940.95$ 351-375 Cans per Week 8,992.64$ 11,171.87$ 13,879.26$ 376-400 Cans per Week 9,600.66$ 11,927.27$ 14,817.77$ MANUAL 50 GALLON CANS COMMERCIAL REFUSE, RECYCLING AND ORGANICS RATES
Bin Service Current Total
30-Day Bill July 1, 2023 October 1, 2023
2 yd Bin 1 Time per Week 142.84$ 176.87$ 219.07$ 2 yd Bin 2 Times per Week 264.53$ 328.07$ 406.92$ 2 yd Bin 3 Times per Week 386.31$ 479.36$ 594.89$ 2 yd Bin 4 Times per Week 508.02$ 630.57$ 782.75$ 2 yd Bin 5 Times per Week 629.73$ 781.79$ 970.63$ 2 yd Bin 6 Times per Week 936.95$ 1,163.47$ 1,444.83$ 2 yd Bin 7 Times per Week 1,058.65$ 1,314.68$ 1,632.68$ 2 yd Bin 8 Times per Week 1,180.42$ 1,465.97$ 1,820.65$ 2 yd Bin 9 Times per Week 1,302.13$ 1,617.18$ 2,008.51$ 2 yd Bin 10 Times per Week 1,423.84$ 1,768.39$ 2,196.37$ 2 yd Bin 11 Times per Week 1,747.50$ 2,170.51$ 2,695.97$ 2 yd Bin 12 Times per Week 1,869.20$ 2,321.71$ 2,883.82$ 2 yd Bin 13 Times per Week 1,990.91$ 2,472.92$ 3,071.68$ 2 yd Bin 14 Times per Week 2,112.69$ 2,624.21$ 3,259.65$ 2 yd Bin 15 Times per Week 2,234.39$ 2,775.42$ 3,447.51$ 2 yd Bin 16 Times per Week 2,557.92$ 3,177.38$ 3,946.90$ 2 yd Bin 17 Times per Week 2,679.63$ 3,328.58$ 4,134.75$ 2 yd Bin 18 Times per Week 2,801.34$ 3,479.80$ 4,322.63$ 2 yd Bin 19 Times per Week 2,923.11$ 3,631.09$ 4,510.59$ 2 yd Bin 20 Times per Week 3,044.82$ 3,782.29$ 4,698.45$ 2 yd Bin 21 Times per Week 3,368.35$ 4,184.24$ 5,197.83$ 2 yd Bin 22 Times per Week 3,490.05$ 4,335.45$ 5,385.70$ 2 yd Bin 23 Times per Week 3,611.76$ 4,486.67$ 5,573.56$ 2 yd Bin 24 Times per Week 3,733.47$ 4,637.87$ 5,761.42$ 2 yd Bin 25 Times per Week 3,855.24$ 4,789.16$ 5,949.38$ 2 yd Bin 26 Times per Week 4,178.71$ 5,191.04$ 6,448.67$ 2 yd Bin 27 Times per Week 4,300.48$ 5,342.32$ 6,636.63$ 2 yd Bin 28 Times per Week 4,422.19$ 5,493.54$ 6,824.50$ 2 yd Bin 29 Times per Week 4,543.89$ 5,644.74$ 7,012.35$ 2 yd Bin 30 Times per Week 4,665.67$ 5,796.04$ 7,200.33$ 2 yd Bin 31 Times per Week 4,989.26$ 6,198.07$ 7,699.81$ 2 yd Bin 32 Times per Week 5,150.27$ 6,398.10$ 7,948.33$ 2 yd Bin 33 Times per Week 5,311.26$ 6,598.12$ 8,196.84$ 2 yd Bin 34 Times per Week 5,472.26$ 6,798.15$ 8,445.35$ 2 yd Bin 35 Times per Week 5,633.26$ 6,998.17$ 8,693.86$ 2 yd Bin 36 Times per Week 5,794.26$ 7,198.20$ 8,942.37$ 2 yd Bin 37 Times per Week 5,955.26$ 7,398.23$ 9,190.89$ 2 yd Bin 38 Times per Week 6,116.26$ 7,598.26$ 9,439.40$ 2 yd Bin 39 Times per Week 6,277.25$ 7,798.27$ 9,687.90$ 2 yd Bin 40 Times per Week 6,438.26$ 7,998.30$ 9,936.42$ 2 YARD BIN COMMERCIAL REFUSE, RECYCLING AND ORGANICS RATES
Bin Service Current Total
30-Day Bill July 1, 2023 October 1, 2023
3 yd Bin 1 Time per Week 183.26$ 227.09$ 281.46$ 3 yd Bin 2 Times per Week 386.31$ 479.36$ 594.89$ 3 yd Bin 3 Times per Week 508.02$ 630.57$ 782.75$ 3 yd Bin 4 Times per Week 936.95$ 1,163.47$ 1,444.83$ 3 yd Bin 5 Times per Week 1,082.26$ 1,344.01$ 1,669.12$ 3 yd Bin 6 Times per Week 1,302.13$ 1,617.18$ 2,008.51$ 3 yd Bin 7 Times per Week 1,564.44$ 1,943.08$ 2,413.40$ 3 yd Bin 8 Times per Week 1,975.15$ 2,453.34$ 3,047.36$ 3 yd Bin 9 Times per Week 2,216.70$ 2,753.44$ 3,420.20$ 3 yd Bin 10 Times per Week 2,537.66$ 3,152.20$ 3,915.62$ 3 yd Bin 11 Times per Week 2,622.11$ 3,257.12$ 4,045.98$ 3 yd Bin 12 Times per Week 2,804.66$ 3,483.93$ 4,327.76$ 3 yd Bin 13 Times per Week 2,987.23$ 3,710.74$ 4,609.55$ 3 yd Bin 14 Times per Week 3,169.89$ 3,937.68$ 4,891.50$ 3 yd Bin 15 Times per Week 3,352.44$ 4,164.49$ 5,173.29$ 3 yd Bin 16 Times per Week 3,837.74$ 4,767.42$ 5,922.37$ 3 yd Bin 17 Times per Week 4,020.30$ 4,994.23$ 6,204.16$ 3 yd Bin 18 Times per Week 4,202.87$ 5,221.05$ 6,485.97$ 3 yd Bin 19 Times per Week 4,385.53$ 5,447.99$ 6,767.91$ 3 yd Bin 20 Times per Week 4,568.08$ 5,674.80$ 7,049.70$ 3 yd Bin 21 Times per Week 5,053.38$ 6,277.73$ 7,798.78$ 3 yd Bin 22 Times per Week 5,235.94$ 6,504.54$ 8,080.57$ 3 yd Bin 23 Times per Week 5,418.50$ 6,731.36$ 8,362.36$ 3 yd Bin 24 Times per Week 5,601.06$ 6,958.17$ 8,644.15$ 3 yd Bin 25 Times per Week 5,783.72$ 7,185.11$ 8,926.10$ 3 yd Bin 26 Times per Week 6,268.92$ 7,787.92$ 9,675.04$ 3 yd Bin 27 Times per Week 6,451.57$ 8,014.85$ 9,956.97$ 3 yd Bin 28 Times per Week 6,634.14$ 8,241.67$ 10,238.78$ 3 yd Bin 29 Times per Week 6,816.70$ 8,468.48$ 10,520.57$ 3 yd Bin 30 Times per Week 6,999.36$ 8,695.41$ 10,802.51$ 3 yd Bin 31 Times per Week 7,484.76$ 9,298.47$ 11,551.75$ 3 yd Bin 32 Times per Week 7,726.26$ 9,598.52$ 11,924.52$ 3 yd Bin 33 Times per Week 7,967.75$ 9,898.55$ 12,297.29$ 3 yd Bin 34 Times per Week 8,209.25$ 10,198.59$ 12,670.05$ 3 yd Bin 35 Times per Week 8,450.75$ 10,498.62$ 13,042.82$ 3 yd Bin 36 Times per Week 8,692.25$ 10,798.66$ 13,415.59$ 3 yd Bin 37 Times per Week 8,933.75$ 11,098.70$ 13,788.35$ 3 yd Bin 38 Times per Week 9,175.24$ 11,398.73$ 14,161.11$ 3 yd Bin 39 Times per Week 9,416.75$ 11,698.78$ 14,533.90$ 3 yd Bin 40 Times per Week 9,658.25$ 11,998.82$ 14,906.66$ 3 YARD BIN COMMERCIAL REFUSE, RECYCLING AND ORGANICS RATES
Bin Service Current Total
30-Day Bill July 1, 2023 October 1, 2023
4 yd Bin 1 Time per Week 287.37$ 356.43$ 442.17$ 4 yd Bin 2 Times per Week 530.79$ 658.85$ 817.89$ 4 yd Bin 3 Times per Week 774.34$ 961.44$ 1,193.82$ 4 yd Bin 4 Times per Week 1,017.75$ 1,263.86$ 1,569.55$ 4 yd Bin 5 Times per Week 1,261.17$ 1,566.28$ 1,945.27$ 4 yd Bin 6 Times per Week 1,875.60$ 2,329.65$ 2,893.69$ 4 yd Bin 7 Times per Week 2,119.02$ 2,632.07$ 3,269.42$ 4 yd Bin 8 Times per Week 2,362.56$ 2,934.65$ 3,645.34$ 4 yd Bin 9 Times per Week 2,605.98$ 3,237.07$ 4,021.06$ 4 yd Bin 10 Times per Week 2,849.40$ 3,539.49$ 4,396.79$ 4 yd Bin 11 Times per Week 3,496.72$ 4,343.73$ 5,395.98$ 4 yd Bin 12 Times per Week 3,740.13$ 4,646.13$ 5,771.69$ 4 yd Bin 13 Times per Week 3,983.55$ 4,948.56$ 6,147.42$ 4 yd Bin 14 Times per Week 4,227.09$ 5,251.14$ 6,523.35$ 4 yd Bin 15 Times per Week 4,470.51$ 5,553.56$ 6,899.07$ 4 yd Bin 16 Times per Week 5,117.57$ 6,357.47$ 7,897.85$ 4 yd Bin 17 Times per Week 5,360.98$ 6,659.88$ 8,273.56$ 4 yd Bin 18 Times per Week 5,604.39$ 6,962.30$ 8,649.29$ 4 yd Bin 19 Times per Week 5,847.94$ 7,264.89$ 9,025.22$ 4 yd Bin 20 Times per Week 6,091.35$ 7,567.30$ 9,400.94$ 4 yd Bin 21 Times per Week 6,738.41$ 8,371.20$ 10,399.72$ 4 yd Bin 22 Times per Week 6,981.83$ 8,673.62$ 10,775.44$ 4 yd Bin 23 Times per Week 7,225.24$ 8,976.04$ 11,151.17$ 4 yd Bin 24 Times per Week 7,468.65$ 9,278.46$ 11,526.89$ 4 yd Bin 25 Times per Week 7,712.20$ 9,581.04$ 11,902.82$ 4 yd Bin 26 Times per Week 8,359.14$ 10,384.79$ 12,901.40$ 4 yd Bin 27 Times per Week 8,602.67$ 10,687.36$ 13,277.31$ 4 yd Bin 28 Times per Week 8,846.09$ 10,989.79$ 13,653.05$ 4 yd Bin 29 Times per Week 9,089.50$ 11,292.20$ 14,028.76$ 4 yd Bin 30 Times per Week 9,333.05$ 11,594.78$ 14,404.69$ 4 yd Bin 31 Times per Week 9,980.25$ 12,398.86$ 15,403.68$ 4 yd Bin 32 Times per Week 10,302.24$ 12,798.91$ 15,900.70$ 4 yd Bin 33 Times per Week 10,624.25$ 13,198.96$ 16,397.72$ 4 yd Bin 34 Times per Week 10,946.24$ 13,599.01$ 16,894.74$ 4 yd Bin 35 Times per Week 11,268.24$ 13,999.06$ 17,391.77$ 4 yd Bin 36 Times per Week 11,590.24$ 14,399.11$ 17,888.79$ 4 yd Bin 37 Times per Week 11,912.24$ 14,799.17$ 18,385.82$ 4 yd Bin 38 Times per Week 12,234.24$ 15,199.22$ 18,882.84$ 4 yd Bin 39 Times per Week 12,556.24$ 15,599.27$ 19,379.86$ 4 yd Bin 40 Times per Week 12,878.24$ 15,999.33$ 19,876.90$ 4 YARD BIN COMMERCIAL REFUSE, RECYCLING AND ORGANICS RATES
Bin Service Current Total
30-Day Bill July 1, 2023 October 1, 2023
Additional 32 Gallon Organics Cart -$ 5.55$ 5.55$ Additional 64 Gallon Organics Cart -$ 12.17$ 12.17$ Additional 100 Gallon Organics Cart -$ 20.69$ 20.69$
COMMERCIAL AUTOMATED CART COLLECTION
Description
Current Fee PROPOSED
JULY 1, 2023
PROPOSED
OCTOBER 1, 2023
Deposit for New Service - Residential 34.35$ 38.23$ 45.32$ Deposit for New Service - Commercial Rate 5 37.39$ 49.44$ 63.78$ Deposit for New Service - Commercial Manuals: Rate 6-29 94.56$ 116.13$ 143.02$ Deposit for New Service - Commercial 2 Yd: Rate 201-240 142.84$ 179.11$ 217.21$ Deposit for New Service - Commercial 3 Yd: Rate 301-340 183.29$ 226.12$ 279.08$ Deposit for New Service - Commercial 4 Yd: Rate 401-440 287.37$ 354.92$ 438.41$ Special Pickup - Bags/Bundles/Boxes 1-10 19.37$ 19.37$ 19.37$ Special Pickup - Bags/Bundles/Boxes 11-25 24.21$ 24.21$ 24.21$ Special Pickup - 1 Bulky Item 7.65$ 7.65$ 7.65$
Tire Collection - per tire 4.81$ 4.81$ 4.81$
Special Collection - 2 yd bin 39.60$ 39.60$ 39.60$ Special Collection - 3 yd bin 46.11$ 46.11$ 46.11$ Special Collection - 4 yd bin 52.61$ 52.61$ 52.61$ Special Collection - 96 gal cart 15.12$ 15.12$ 15.12$ Special Collection - 64 gal cart 14.18$ 14.18$ 14.18$ Special Collection - 32 gal cart 13.35$ 13.35$ 13.35$ Bin/Barrel/Cart Rollout 10.05$ 10.05$ 10.05$
Automated Cart/Bin Exchange 42.53$ 42.53$ 42.53$
Late Setout/Locked Gate 17.01$ 17.01$ 17.01$
Bin Rental - 2 yd bin 25.00$ 25.00$ 25.00$
Bin Rental - 3 yd bin 35.00$ 35.00$ 35.00$
Bin Rental - 4 yd bin 35.00$ 35.00$ 35.00$
Bin Lock/Service Fee (per service) 5.67$ 5.67$ 5.67$
55.00$ 55.00$ 55.00$ per hour plus actual
costs incurred for
disposal
per hour plus actual
costs incurred for
disposal
per hour plus actual
costs incurred for
disposal
55.00$ 55.00$ 55.00$ per hour plus actual
costs incurred for
disposal
per hour plus actual
costs incurred for
disposal
per hour plus actual
costs incurred for
disposal
Account Reinspection and debris overflow cleanup/Providing sufficient service to minimize overflow(charged when
determined to be responsibility of account holder)
Account Reinspection and dumped item removal (charged
when determined to be responsibility of account holder)
RATE RESOLUTION
Managing Tomorrow’s Resources Today
590 Ygnacio Valley Road, Suite 105 Robert D. Hilton, Emeritus Walnut Creek, California 94596 John W. Farnkopf, PE
Telephone: 925/977-6950 Laith B. Ezzet, CMC
www.hfh-consultants.com Rick Simonson
Marva M. Sheehan, CPA
Rob C. Hilton
March 9, 2023
Mr. Diko Melkonian
Manager/Deputy Director
Environmental Services Bureau
City of Long Beach
2929 E. Willow Street
Long Beach CA 90806
Subject: Environmental Services Bureau Cost of Service and Rate Study
Dear Mr. Melkonian:
HF&H Consultants, LLC (HF&H) is pleased to submit this report to the City of Long Beach ’s Public Works Environmental Services Bureau (City). Sections I. through IV. of this report are the original sections included in our original report dated July 8, 2022, and relate specifically to the analysis performed for the rates proposed to City Council by City staff on August 23, 2022. These sections of the report include 1) the determination of how much projected revenue is needed from rates during fiscal year October 1, 2021- September 30, 2022 (FY 22) and fiscal year October 1, 2022 – September 30, 2023 (FY 23) (the period prior to implementation of an organics program for all customers, as further explained below); 2) the impact on the estimated operating surplus/shortfall for the City’s solid waste system if rates are not increased; and, 3) recommended rate increase s to cover costs for services currently provided , the expansion of commercial organics waste collection, and meet the City’s reserve fund balance goals. During the August 23, 2022, Council meeting, City staff recommended two rate increases, with effective dates of September 1, 2022, and January 1, 2023. The Council approved the rate increase for September 1, 2022, but did not approve the rate increa se recommended for January 1, 2023, instead requesting City staff analyze a phased in approach to the increase. Section V, and thereafter , is related to the additional analysis and evaluation performed to determine a scenario for phasing in a rate adjustment as requested by City Council.
I. BACKGROUND
The City provides solid waste services to single-family residents and small multi-family complexes located within the City’s limits. The City is also the exclusive provider of solid waste collection services to smaller businesses (less than 3,000 gallons/week of service) and smaller multi-family complexes (less than 1,000 gallons/week, typically about 10 dwelling units). The City competes with permitted private haulers to provide solid waste hauling services to larger multi-family and commercial accounts. The City’s recycling contractor, Waste Management, provides recycling services to all City-serviced solid waste accounts. The City services approximately 121,000 containers on a weekly basis. See Figure 1 for detail of containers in service.
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
Figure 1. Total Containers in Service
To determine whether additional rate revenue is required for the forthcoming rate year , projected operating and capital expenses are compared with projected revenue from current rates. Rates are then proposed to be adjusted as necessary so that the expenses are covered and reserve goals are reached.
The report reflects input from the City staff in refining the rates. The resulting rate increases are necessary for several reasons: (1) in recent years, the City’s rates have not generated revenues sufficient to cover costs, resulting in drawing down reserves; (2) the cost of collection of solid waste has increased; and, (3) additional costs to comply with new State-mandated diversion programs (e.g., SB 1383, which requires collection of organic materials separate from solid waste).
The City requested HF&H prepare an analysis of the current solid waste rates , rate structure , and operating costs, and evaluate if, and to what extent, a rate increase may be necessary to cover the City’s operational costs of its solid waste enterprise.
City goals contemplated in the analysis include t he City’s goal to establish a n Operating Reserve fund balance equal to four months of solid waste related expenditures. The Operating Reserve will assist in mitigating future shortfalls, unexpected, but necessary, expenditures, and to assist in addressing anticipated, but unquantifiable, future costs, such as those related to Senate Bill 1383 compliance.
A. Senate Bill 1383 Consideration
Regulations implementing Senate Bill 1383 (SB 1383 Regulations) , which took effect January 1, 2022, require local jurisdictions to divert organics from landfills. The SB 1383 Regulations have a pervasive impact and will result in the City incurring additional costs for items such as, but not limited to, collection and related equipment, processing, reporting, administ rative functions for monitoring compliance, procurement, and public education. The City has submitted a Notice of Intent to Comply, in line with Senate Bill 619, to CalRecycle, with the expectation of Senate Bill 1383 (SB 1383) compliance by December 31, 2023.
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
The City intends to implement a commercial organics collection program in FY 23 and a residential organics collection program by December 31, 2023. This study considers anticipated operational costs of the commercial organics program , the administrative costs of the commercial and residential organics programs, and the purchase of an estimated 50% of the organic carts that will be needed upon the residential organics program roll -out. Further description on the SB 1383 related costs included can be found in the “ New Costs - SB 1383 ” section of this report. T he full extent of the cost impact of the residential organics program is unknown and cannot be reasonably estimated at the time of this report.
Due to the level of uncertainty surrounding future residential organics related costs, such as processing, collection, reporting, and related administrative costs, proposed rate increases included in the report are limited to the next two fiscal. Another cost-of-service study will be performed to re-set the commercial and residential rates, inclusive of organics programs.
B. Proposition 218
To increase rates for these services, the City intends to comply with Article XIIID, Section 6 of the California Constitution, which was enacted by Proposition 218 in 1996. This Section requires that (1) revenues derived from fees or charges for property -related service not exceed the cost to provide service; (2) revenues derived from fees or charges not be used for any pu rpose other than that for which it was imposed; (3) the amount of a fee or charge upon an account not exceed the proportional cost of the service attributable to the parcel; (4) no fee or charge may be imposed for a service unless that service is actually used by, or immediately available to, the owner of the property; and, (5) no fee or charge may be imposed for general governmental services.
The recommended rates from the conduct of our cost -of-service study satisfies the requirements of Proposition 218, as stated above, as follows:
1. Proposed rates were calculated based on separately-tracked and projected costs incurred to operate the solid waste services provided by the City’s Environmental Services Bureau.
2. Revenue derived from the proposed rates are kept within the Environmental Services Bureau to cover their costs. No revenue is transferred out to other City departments.
3. To ensure the proposed rates for each customer class do not exceed their proportional costs, the cost-of-service analysis apportioned s hared overhead costs (e.g., billing, general and administrative) to each customer class (e.g., residential carts, commercial bins) based on their proportionate share of levels of service provided (e.g., collections per week, volume collected) and costs solely attributable to each customer class (e.g., commercial organics collection costs) are bourn exclusively by the respective customer class.
4. Not all properties within the City are serviced by City operations. The City bills only those properties receiving City services and the charge is based on the level of service being provided (e.g., size of container and frequency of collection).
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
5. The proposed rates were calculated based solely on projected costs incurred to provide solid waste services , including support from non -solid waste City departments through interfund transfers which are supported by cost allocation nexus studies. We found no instances of interfund transfers out of the solid waste to fund general governmental services not utilized to provide solid waste services to the City’s residents and businesses.
II. SCOPE OF WORK
Based on the operational statistics provided by the City, HF&H developed a solid waste rate model. The model was designed to develop rate increase scenarios to fund City’s financial requirements, including operations and maintenance, capital improvement, and reserve fund goals.
We performed the following procedures as part of our analysis:
• Obtained cost, rate, and current customer account data from City staff • Prepared a summary schedule projecting the City’s costs and revenues for the next two fiscal years (FY 23 and FY 24). The City provided the FY 22 budget, which served as the starting point for projecting the City’s expenses and revenues. Working with City staff, the projections include the following:
o an inflationary increase of 7.1% in FY 23 and 4.0% in FY 24 o an assumption that actual expenditures incurred will be 4.5% less than budgeted. Due to high turnover of Refuse Operator positions , refuse operations have historically come in under budget. The City is passing the savings on to rate payers by basing rates and reserve fund balances on the actual expenditures.
• Created a cost-of-service model, reflecting the estimated costs and revenues for future fiscal years with resulting rate increases by customer class to cover operating and capital costs . HF&H provided the model to City staff, which allowed City Staff to model various scenarios and rate adjustments (Scenario Model) to meet anticipated costs and the Operating Reserve fund target. o The Scenario Model was used to include additional expenditures for FY 23 based on City staff estimates. Examples of these expenditures include, but are not limited to, the increase in the recycling contract and certain estimated new organic services costs (e.g., administrative labor, carts, trucks, disposal, public education). The included organic services costs were estimated by the City and do not include all potential future costs of SB 1383 compliance. A cost-of- service study will be performed to establish rates for the FY 24 fiscal year incorporating the full cost of residential organic collection to comply with SB 1383 requirements. o HF&H reviewed various rate scenarios modeled by City staff, including the final rate scenario to be recommended to City Council , to confirm the mathematical accuracy of the model calculations and that the final rate scenario aligned with the City’s goals.
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
III. LIMITATIONS
This study was prepared solely for the City of Long Beach, in accordance with the contract between the City and HF&H and is not in intended for use by any other party for any other purpose.
In preparing this study, HF&H relied on information and instructions from the City, which we consider to be accurate and reliable and did not independently verify. The subscription data supplied by the City required manual adjustments by city staff and we relied on the adjusted service levels in the cost -of- service calculations.
The rate model and Scenario Model, and accompanying analyses , contain projections of revenues and expenditures based on various assumptions and estimates provided by the City. While we reviewed those projections for reasonableness, actual results of operations will usually differ from projections because events and circumstances do not always occur as expected. Those differences may be significant and materially affect the analyses and findings presented in this report.
Rounding differences caused by stored values in electronic models may exist.
This study addresses relevant laws, regulations, and court decisions but should not be relied upon as legal advice. Questions concerning the interpretation of legal authorities referenced in this study should be referred to a qualified attorney.
The Scenario Model was created anticipating the new rates would be effective August 1, 2022. However, to ease the burden on rate payers, the City has moved the anticipated implementation date to September 1, 2022, without increasing rates to account for lost revenues. The City acknowledges a delay of the proposed rate increases will affect the pr ojections modeled in this report , including the effects on the Operating Reserve fund balance. HF&H is not under obligation to revise the model, the projections, or this report.
IV. FINDINGS
A. Current Operations
HF&H reviewed the City’s current (FY 21) revenues from collection operations less non-operating revenue.
As shown in Figure 2, the City is anticipating a revenue shortfall of $4,619,698 in FY 22, based on projected revenues at current rates of $51,208,133 and projected costs of $55,827,831. The revenue shortfall will draw down the City’s fund balance to $3,857,733 by September 30, 2022, well below the City’s target fund balance of $18,609,277.
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
Figure 2. FY 22 Revenue Requirement Analysis
The results of this analysis indicate the need for rate increases and/or additional sources of revenue to cover operating and capital costs and maintain a prudent reserve fund balance . While reserves are available to accommodate the projected shortfall in FY 2 2, continued operating shortfalls will quickly deplete the City’s reserves. Currently, the City has a goal of reaching an Operating Reserve fund balance that is, at least, equal to four months of operating expenses. At the start of Fiscal Year 22, the City has $8,477,431 in reserves, approximately 2 months of operating costs. If the City uses reserves to cover the shortfall, the remaining Operating Reserve fund balance of $3,857,733 will cover only 0.8 months of expenditures. A 9.0% rate increase would be necessary to cover operating and capital costs without utilizing reserve funds.
B. Projected Operations
Based on the data above, HF&H projected annual revenue requirements. As directed by City staff, HF&H applied a 7.1% inflation factor to the FY 22 budget and a 4.0% inflation factor annually thereafter.
Additionally, City staff cited historical turnover in the Refuse Operator position has led to actual expenses incurred in recent years being approximately 4.5% less than budget . Though City staff aims to fill that position on a full-time basis in the future, the actual expenditures were included for modeling purposes to pass on the savings to the rate -payers. In addition, the City’s revenue requirement was increased for new administrative costs related to the up coming commercial organics collection program , as further discussed below, and the increase in the recycling contract (total increases being between $4,000,000 - $4,750,000 annually from FY 23 and thereafter). As shown in Figure 3 below, under the assumptions of this scenario, revenues under current rates result in a significant shortfall when compared to the revenue requirement for the solid waste system as a whole.
Analysis of Costs and Revenues at Current Rates
FY 21 FY 22
Projected Costs 55,827,831$ A
Projected Revenue at Current Rates 51,208,133$ B
Deficiency of Revenues vs. Costs (4,619,698)$ B-A = C Projected Rate Adjustment 9.0% C/B = D
Fund Balance before use of Reserves 8,477,431$ E
Contribution of Fund Balance to Rates (4,619,698)$ C Fund Balance after Use of Reserves 8,477,431$ 3,857,733$ E + C = F Months of Expenditures 0.8 F/A*12 = G Target Fund Balance (4 Months) 18,609,277$ A/12*4=H
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
Figure 3. Projected FY 22 and FY 23 Revenue Shortfalls at Current Rates
The impact of not increasing rates results in a negative fund balance by the end of FY 23 of approximately $(11,408,000), which, absent rate increases, will continue to decline. To cover increases in operational , capital, and administrative costs, and generate additional funds to reach the target Operating Reserve fund balance, the City will need to implement rate increases.
C. Rate Adjustment Scenario
The City recognizes the need to increase revenues to cover its current operating costs, new costs, and generate sufficient reserve to meet the goal Operating Reserve fund balance. As such, City staff worked with HF&H to model a rate adjustment scenario that meets both the significant revenue requirement increases and builds toward the targeted Operating Reserve fund balance. After evaluating alternative timing of rate increase(s), City staff determined the final proposed rate increases are planned to occur on September 1, 2022 and January 1, 2023, subject to HF&H’s limitations section.
As discussed above, the results of the cost-of-service study showed the City is incurring losses to provide solid waste services to both the residential solid waste customer cart class and the commercial solid waste bin customer class. The study also determined the rates currently charged to the residential solid waste customer class more closely aligned wit h their cost of service than the commercial solid waste bin customer class. Therefore, when modeling the rate adjustments, higher rate increases should be applied to the commercial solid waste bin customer class than the residential solid waste customer class. This methodology guided the structuring of the rate adjustment scenario.
Based on the above guidelines and goals, the City utilized the Scenario Model to develop a final rate scenario incorporating the following goals and assumptions:
Analysis of Costs and Revenues at Current Rates
FY 21 FY 22 FY 23
Project Costs (Budgeted and Inflated) $55,828 $62,447 A Projected Costs (New Administrative) - 4,026 B Projected Costs 55,828 66,473 A + B = C
Actual Revenue at Current Rates 51,208 51,208 D
Deficiency of Revenues vs. Costs $(4,620) $(15,265) D-C = E Projected Rate Adjustment 9.0% 29.8% -E/D = F
Fund Balance before use of Reserves $8,477 $3,857 G
Contribution of Fund Balance to Rates (4,620) (15,265) E Fund Balance after Use of Reserves $8,477 $3,857 $(11,408) G + E = H Months of Expenditures 0.8 (2.1) H/C*12 = I Target Fund Balance (4 Months) $18,609 $22,158 C/12*4= J (In $1,000s)
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
• The four-month Operating Reserve target is projected to be reached by the end of FY 26, barring consideration of additional residential organic program costs to be incurred. • The recycling contract is to be re-negotiated, leading to assum ed costs being used beginning FY
23. • New costs approximating $6,943,000, spread over FY 23 and FY 24, will be incurred to comply with SB 1383. See “New Costs- SB 1383” section below for further discussion of these costs.
1. New Costs- SB 1383
The City anticipates new operational and administrative costs will be incurred to comply with SB 1383.
City intends to add two new sections to the Recycling and Waste Reduction division: Compliance & Enforcement and Program & Education. The Compliance & Enforcement section will be responsible for compliance with, and enforcement of, State laws, including SB 1383 Regulations, and providing all new reporting as required by the State. The Program & Education section will implement the education and recycling components required by new State laws, including SB 1383 Regulations. These new groups are necessary to implement efforts required by State laws, SB 1383, AB 1826, and AB 341. All new administrative staffing costs were allocated on a fifty/fifty basis to residential and commercial customers. In addition to the staffing requirements, capital needs and operational costs will increase.
A summary of the estimated new cost drivers related to SB 1383 in FY 23 and FY 24 are:
• $3,917,000 for anticipated capital purchases, including:
o Approximately 4,850 organics carts for commercial customers o 27,500 organics carts for residential customers. This represents approximately 25% of anticipated total needed carts, but is included to build funds for purchase to meet the December 31, 2023, compliance deadline.
o 2 pick-up trucks (non-collection vehicles) for refuse field investigators • $3,924,000 for administrative organics collection costs for personnel, education, administration, and maintenance, increased for inflation annually, Including:
o $1,825,000 for approximately 17 new full-time employees . Responsibilities for new employees will include, but are not limited to, route reviews (account audits), develop and implement food recovery programs, performing site visits, educational outreach, and other tasks needed for enforcing, tracking, monitoring, and reporting compliance with State laws.
o $1,039,000 for fuel and vehicle expenses for commercial collection operations. This includes maintenance and leasing costs for eight (8) 25-yard side-loaders, which will be financed.
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
o $885,000 in disposal costs for the commercial organics program o $175,000 for public education . Cost includes, but is not limited to, advertising, educational outreach program development, and material costs.
2. Rate and Fund Impact
Figure 4 summarizes the proposed rates for some of the most -common levels of service . Figure 5 summarizes the proposed scenario’s impact on the fund balance.
Figure 4. Proposed Monthly Rates
Figure 5. Impact of Proposed Rate Increases for FY 22 and FY 23
HF&H reviewed the City’s final scenario of an 18.6% residential increase, a 29.3% commercial increase, and a 19.5% recycling increase on September 1, 2022 , and a n 18.6% residential increase, a 40.1% commercial increase, and a 19.5% recycling increase on January 1, 2023 . The revenue generated for organic carts and trucks in FY 23 ($2,193,000) and FY 24 ($1,724,000) will be restricted for SB 1383 capital costs. Finally, t he City is projected to reach the four month Operating Reserve target by the end of FY 26, barring consideration of additional residential organic program costs to be incurred.
Rate Increase New Rate Rate Increase New Rate
Residential 64-Gallon Solid Waste Cart 20.44$ 18.63% 24.25$ 18.63% 28.77$ Residential 100-Gallon Solid Waste Cart 24.96$ 18.63% 29.61$ 18.63% 35.13$ Commercial Solid Waste Bin - 2 YD 106.79$ 29.25% 138.03$ 40.14% 193.43$ Commercial Solid Waste Bin - 3 YD 138.06$ 29.25% 178.44$ 40.14% 250.07$ Commercial Solid Waste Bin - 4 YD 218.62$ 29.25% 282.57$ 40.14% 395.99$ Residential and Commercial Recycling Cart 4.03$ 19.46% 4.81$ 19.46% 5.75$ 1-Sep-22 1-Jan-23FY 20
Rate
Rate Increase Rate Increase
FY 21 1-Sep-22 FY 22 1-Jan-23 FY 23
Projected Costs $55,828 $66,473
Projected Revenue at Increased Rates
Residential Solid Waste 18.63% 34,236 18.63% 45,493
Commercial Solid Waste and Organics 29.25% 11,785 40.14% 17,883 Residential and Commercial Recycling Carts 19.46% 7,252 19.46% 9,126 Total Projected Revenue at Increased Rates $53,273 $72,502 Excess (Deficiency) of Revenues vs. Costs $(2,555) $6,029 Fund Balance before use of Reserves $8,477 $5,922
Contribution to/(of) Fund Balance from/(to) Rates $(2,555) $6,029 Funds Restricted for SB 1383 Related Costs - $(2,193)
Fund Balance after Use of Reserves $8,477 $5,922 $9,758 Months of Expenditures - 1.3 1.8 Target Fund Balance (4 Months) $18,609 $22,158
($s are in $1,000s)
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
The impact of not increasing rates versus increasing rates by the scenario presented above on the City’s Operating Reserve fund balance, barring consideration of additional residential organic program costs to be incurred and future rate increases t o be determined upon the residential organics program implementation, can be seen in Figure 6 below:
Figure 6. Projected Operating Reserve Fund Balance
The City may elect to not increase rates, but this will lead to a rapid depletion of the City’s Operating Reserve fund balance. This will result in the need for larger rate increases in future years to make up fo r these shortfalls.
HF&H recommends the City increase residential, commercial, and recycling rates by their respective percentages in Figure 4 on September 1, 2022 and January 1, 2023, to prevent the projected short-term depletion of reserve funds and to mitigate more significant rate increases in the future . As aforementioned, the City should, and intends to, perform another cost- of- service study to determine the necessary rate increases for FY 24 to account for unanticipated commercial organic program costs and new residential organics program costs.
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
V. CITY COUNCIL ACTION - AUGUST 23, 2022
On August 23, 2022, City Council approved the solid waste rate increases included in Figure 7, effective September 1, 2022.
Figure 7. September 1, 2022 Monthly Rate Increases
The recommended rate increases included in Figure 8 were not approved by City Council on August 23, 2022.
Figure 8. Recommended January 1, 2023 Monthly Rate Increases Not Approved
VI. 2023 PHASED IN RATE ADJUSTMENT OPTIONS
At the August 23, 2022 Council Meeting, the City Council requested City staff to develop reasonable approaches to phase-in the recommended January 1, 2023, increase to soften the impact to rate payers.
Working with City staff, HF&H developed four proposed rate adjustment options, which would defer the necessary increase, yet still result in achieving the City’s target reserve balance by FY 26 (as shown in Figure 6). It should be noted that the effect of simply deferring the implementation of the exact recommended new rates shown in Figure 8 to a later date, would result in less revenue to the City’s solid waste enterprise. As such, the solid waste enterprise would not reach the target reserve balance by FY 26, as intended, unless rates are increased something greater than originally proposed for January 1, 2023.
Therefore, the four rate adjustment options result in slightly higher rates than the original recommendation. In addition, subsequent to the original analysis discussed in Sections I through I -V above, the projected costs for complying with the State’s new regulations restricting organics waste Rate Increase New Rate
Residential 64-Gallon Solid Waste Cart 20.44$ 18.63% 24.25$ Residential 100-Gallon Solid Waste Cart 24.96$ 18.63% 29.61$ Commercial Solid Waste Bin - 2 YD 106.79$ 29.25% 138.03$ Commercial Solid Waste Bin - 3 YD 138.06$ 29.25% 178.44$ Commercial Solid Waste Bin - 4 YD 218.62$ 29.25% 282.57$ Residential and Commercial Recycling Cart 4.03$ 19.46% 4.81$ FY 20
Rate
1-Sep-22
Rate Increase New Rate
Residential 64-Gallon Solid Waste Cart 24.25$ 18.63% 28.77$ Residential 100-Gallon Solid Waste Cart 29.61$ 18.63% 35.13$ Commercial Solid Waste Bin - 2 YD 138.03$ 40.14% 193.43$ Commercial Solid Waste Bin - 3 YD 178.44$ 40.14% 250.07$ Commercial Solid Waste Bin - 4 YD 282.57$ 40.14% 395.99$ Residential and Commercial Recycling Cart 4.81$ 19.46% 5.75$ Sep-22
Rate
1-Jan-23
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
disposal (SB 1383) have increased, by approximately $1,362,000 in FY 23. These cost increases have also resulted in higher rates than originally recommended.
With the updated cost data and the direction to defer the January 1, 2023 rate adjustment, HF&H created four options which spreads the rate increases throughout FY 23, and FY 24 in one option, instead of all at once on January 1, 2023, as follows:
1. Rate increases effective June 1, 2023, and September 1, 2023
2. Rate increases effective June 1, 2023, and December 1, 2023
3. Rate increases effective June 1, 2023 , September 1, 2023, and December 1, 2023
4. Rate increase effective June 1, 2023
Figure 9 summarizes the necessary percentage increases for each option. The necessary increases were arrived at by assuming rate increase s within each option involving more than one increase would be smoothed-in as equal percentages on each respective effective date and each option would result in achieving similar reserve target reserve balance by FY 26. HF&H and the City determined Option 1 is the appropriate recommendation to achieve the City’s goals to ease the number and frequency of rate increases on the rate payers, while meeting the reserve fund target.
Figure 9. Potential Rate Increases – All Options
Recommended Phased In Rate and Reserve Fund Impact
Figure 10 summarizes the proposed rates for some of the most -common levels of service if Option 1 is approved.
Figure 10. Monthly Rates Resulting from Recommended Increases – Option 1
Option 4
Container Type eff. date 1-Jun-23 1-Sep-23 1-Jun-23 1-Dec-23 1-Jun-23 1-Sep-23 1-Dec-23 1-Jun-23 Solid Waste Cart Rates 11.25% 11.25% 11.71% 11.71% 7.66% 7.66% 7.66% 23.55% Solid Waste Bin Rates 24.24% 24.24% 25.23% 25.23% 16.18% 16.18% 16.18% 50.75% Recycling Cart Rates 11.75% 11.75% 12.23% 12.23% 8.00% 8.00% 8.00% 24.60% Option 1
Potential Rate Increases
Option 2 Option 3
Rate Increase New Rate Rate Increase New Rate
Residential 64-Gallon Solid Waste Cart 24.25$ 11.25% 26.98$ 11.25% 30.02$ Residential 100-Gallon Solid Waste Cart 29.61$ 11.25% 32.94$ 11.25% 36.65$ Commercial Solid Waste Bin - 2 YD 138.03$ 24.24% 171.49$ 24.24% 213.06$ Commercial Solid Waste Bin - 3 YD 178.45$ 24.24% 221.71$ 24.24% 275.45$ Commercial Solid Waste Bin - 4 YD 282.57$ 24.24% 351.07$ 24.24% 436.17$ Residential and Commercial Recycling Cart 4.81$ 11.75% 5.38$ 11.75% 6.01$ Sep-22
Rate
1-Jun-23 1-Sep-23
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
Figure 11 summarizes the proposed option’s impact on the fund balance for FY 23. As shown in Figure 11, the deferred rate adjustments will result in an operating shortfall for FY 23 of $1,344,000; however, this shortfall can be covered by reserves.
Figure 11. Impact of Recommended Increases for FY 23
The projected FY 23 ending fund balance will be short of the City’s target fund balance of $22,612,000 (i.e., four months of operating expenses), as the recommended increases will not have been in effect for all 12 months of the fiscal year. However, as shown in Figure 12, the fund balance is projected to reach the four month Operating Reserve target by the end of FY 26 , as the September 1, 2023 recommended rates will be in effect for all 12 months of the proceeding years.
FY 23
1-Jun-23 1-Sep-23 ($s are in $1,000s)
Projected Costs $67,835
Projected Revenue at Increased Rates
Residential Solid Waste 11.25% 11.25% 42,119
Commercial Solid Waste and Organics 24.24% 24.24% 15,882 Residential and Commercial Recycling Carts 11.75% 11.75% 8,490 Total Projected Revenue at Increased Rates 66,491
Operating Surplus/(Shortfall) (1,344)
Fund Balance before use of Reserves 5,937
Contribution of Fund Balance to Rates (1,344)
Funds Restricted for SB 1383 Related Costs (1,724)
Fund Balance after Use of Reserves $2,868
Months of Expenditures 0.5
Target Fund Balance (4 Months) $22,612
Rate Increase
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
Figure 12. Projected Operating Reserve Fund Balance with No Increase vs Recommended Increases
The City may elect to not further increase rates or postpone rate increases beyond the dates recommended in Option 1; however, this will lead to a r apid depletion of the City’s Operating Reserve fund balance (dotted red line in Figure 12), before the end of FY 24. This will result in the need for larger rate increases in future years to make up for these shortfalls.
As such, HF&H recommends the City increase residential, commercial, and recycling rates by their respective percentages in Figure 13 on June 1, 2023 and September 1, 2023 (i.e., Option 1), to prevent the projected short-term depletion of reserve funds and to mitigate more significant rate increases in the future. As aforementioned, the City should, and intends to, perform another cost - of- service study to determine the necessary rate increases for FY 24, once the City has implemented the new residential organics program, as required by SB 1383.
Figure 13. Recommended Rate Increases (i.e., Option 1)
* * * *
Managing Tomorrow’s Resources Today
Mr. Diko Melkonian
March 9, 2023
We appreciate the opportunity to be of service to the City. We value our relationship with you and the City and are committed to providing you the highest level of service in the performance of this matter for you. Should you have any questions, pleas e feel free to reach Rick Simonson at rsimonson@hfh- consultants.com or (925) 977-6957.
Sincerely,
HF&H CONSULTANTS, LLC
Rick Simonson, Senior Vice President
Lindsey Lagos, CPA, Senior Associate
Danielle Derby, CPA, Senior Associate
Attachment A – Projected Revenue and Expense Summary (FY 23 through FY 26) Under Rates Originally Proposed
Attachment B – Projected Revenue and Expense Summary (FY 23 through FY 26) Under Newly Proposed Recommended Increases
CITY OF LONG BEACH
SOLID WASTE RATE PROJECTIONS
FY 23 FY 24 FY 25 FY 26
FY 22/23 FY 23/24 FY 24/25 FY 25/26
SUMMARY RESULTS Projected Projected Projected
Revenue 73,373,934$ 76,924,316$ 76,924,316$ 76,924,316$ Expenditures (Total) 62,447,316$ 63,147,172$ 65,718,419$ 68,388,020$ Solid Waste Cart Expenditures 40,288,141$ 41,899,666$ 43,575,653$ 45,318,679$ Solid Waste Bin Expenditures 14,027,675$ 14,588,782$ 15,172,333$ 15,779,227$ Recycling Cart Expenditures 8,293,197$ 8,624,925$ 8,969,922$ 9,328,719$ Expenditures ‐ New Operational Costs 4,923,923$ 5,373,901$ 5,603,776$ 5,845,018$ Overall Surplus/(Shortfall) 6,002,694$ 8,403,244$ 5,602,121$ 2,691,278$ Transfer to Capital Reserve (2,193,037)$ (1,724,250)$ ‐$ ‐$ Net Surplus/ (Shortfall) 3,809,657$ 6,678,994$ 5,602,121$ 2,691,278$ as % of Total Expenditures 5.7% 9.7% 7.9% 3.6%
Operating Reserve
Beginning of FY (Oct. 1) 5,934,547$ 9,744,204$ 16,423,198$ 22,025,318$ End of FY (Sept. 30) 9,744,204$ 16,423,198$ 22,025,318$ 24,716,596$ % of Expenditures 14.5% 24.0% 30.9% 33.3%
Months of Expenditures 1.7 2.9 3.7 4.0
Target Reserve Balance 22,457,080$ 22,840,358$ 23,774,065$ 24,744,346$ Reserve Balance without Rate Increases (7,381,451)$ (19,320,489)$ (33,830,776)$ (51,010,663)$ Capital Reserve
Beginning of FY (Oct. 1) ‐$ ‐$ ‐$ ‐$
Capital Reserve 2,193,037$ 1,724,250$ ‐$ ‐$
Capital Purchases (2,193,037)$ (1,724,250)$
End of FY (Sept. 30) ‐$ ‐$ ‐$ ‐$
Total Reserve Balance 9,744,204$ 16,423,198$ 22,025,318$ 24,716,596$ Attachment A
Projected Revenue and Expense Summary (FY 23 through FY 26) Under Rates Originally Proposed A-1
CITY OF LONG BEACH
SOLID WASTE RATE PROJECTIONS
FY 23 FY 24 FY 25 FY 26
SUMMARY RESULTS Projected Projected Projected
Revenue 66,491,086$ 81,254,499$ 81,254,499$ 81,254,499$ E
xpenditures (Total) 62,446,449$ 64,944,307$ 67,542,079$ 70,243,762$ E
xpenditures ‐ New Costs 5,388,512$ 5,369,806$ 5,599,809$ 5,841,207$ Overall Surplus/
(Shortfall) (1,343,875)$ 10,940,386$ 8,112,611$ 5,169,530$ Transfer to Capital Reserve (1,724,250)$ (1,724,250)$ ‐$ ‐$ Net Surplus/ (Shortfall) (3,068,125)$ 9,216,136$ 8,112,611$ 5,169,530$ as % of Total Ex
penditures ‐4.5% 13.1% 11.1% 6.8%
Operating Reserve
Beginning of FY (Oct. 1) 5,936,505$ 2,868,380$ 12,084,516$ 20,197,127$ En
d of FY (Sept. 30) 2,868,380$ 12,084,516$ 20,197,127$ 25,366,656$ % of Expendit
ures 4.2% 17.2% 27.6% 33.3%
Months of Expenditures 0.5 2.1 3.3 4.0
Target Reserve Balance 22,611,654$ 23,438,038$ 24,380,629$ 25,361,656$ Reserve Balance withou t Additional Rate 927,274$ (6,561,107)$ (16,877,264)$ (30,136,502)$ Ca
pital Reserve
Beginning of FY (Oct. 1) ‐$
‐$
‐$
‐$
Capital Reserve
1,724,250$ 1,724,250$
‐$
‐$
Capital Pu
rchases (1,724,250)$ (1,724,250)$
En
d of FY (Sept. 30) ‐$
‐$
‐$
‐$
To
tal Reserve Balance 2,868,380$ 12,084,516$ 20,197,127$ 25,366,656$ Attachment B
Projected Revenue and Expense Summary (FY 23 through FY 26) Under Newly Proposed Recommended Increases - Option 1 B-1