Agenda packet — San Luis Obispo City Council, April 19, 2022 (part 8 of 9)

Residential Recycling Services Agreement
generated in the city. Contractor has designated the Tank Farm Road facility to be utilized as of the Effective date.

5.7.2 Status of Materials Recovery Facility
Any Materials Recovery Facility used by contractor must be designed and constructed in accordance with all applicable state and local laws (e.g., CEQA, California Code of Regulations, etc). The Materials Recovery Facility must have all permits from federal, state, regional, county and city agencies necessary for it to operate as a Material Recovery Facility and must be in full regulatory compliance with all such permits.

The selected Materials Recovery Facility must be authorized to accept, under its existing permit, and have sufficient uncommitted capacity to accept, all Recyclable Materials delivered to it by, or on behalf of, the City for the term of this Agreement. Contractor shall immediately notify City of any notice of breach or default received from Materials Recovery Facility.

5.7.3 Alternative Processing Facility
If Contractor becomes unable to deliver the City's Recyclable Materials to the Materials Recovery Facility due to causes within its control and which could have been avoided by the exercise of due care, the Contractor shall arrange for it to be accepted at another Materials · Recovery Facility, in which case Contractor shall pay for any increased transportation costs, any differences in the fees charged at such Materials Recovery Facility and the fees then in effect under this Agreement. If Contractor's inability to deliver the City's Recyclable Materials to the Materials Recovery Facility is not due to causes within its control or which could have been avoided by the exercise of due care, then Contractor shall propose alternative Material Recovery Facilities including all related costs and City shall select the alternative to be used.

5.7.4 Disposition of Unauthorized Waste
Contractor shall ensure that procedures to identify and reject materials delivered to the Materials Recovery Facility which are Hazardous Waste, or which otherwise may not be legally accepted at the Materials Recovery Facility under their permits, are in place. Contractor may, in the course of implementing such procedures, refuse to accept Recyclable Materials deposited from the City if they constitute Hazardous Waste, or otherwise may not be legally accepted at the Materials Recovery Facility, and Contractor shall be solely responsible of the materials which are accepted. If Contractor discovers Hazardous Waste, or other material which may not be legally accepted, among materials which it has accepted, it shall dispose of such waste at its own expense. Contractor may pursue all legal rights and remedies it may have against the Waste Generator(s) of such Solid Waste, ifthe Waste Generator(s) can be identified.

5.8 Disposal
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Contractor shall ensure that the residual Solid Waste from the City's Recyclable Materials delivered to the Materials Recovery Facility by the Contractor are disposed of at a permitted disposal site in full regulatory compliance.

5.9 Implementation Plan
The parties recognize that substantial planning will be required in order to assure an orderly initiation of Residential Curbside Recycling Collection services on August 6, 2010, To that end, City has required Contractor to submit, as part of its proposal, a detailed implementation plan addressing, among other things, the steps Contractor will take and the schedule on which it will take them, to prepare for such an orderly initiation of service. The implementation plan shall cover Contractor's schedule for acquiring necessary equipment, personnel, storage and maintenance facilities, administrative offices, customer relations materials (including Collection schedules, route maps, billing forms, complaint forms, service request forms, etc.).

Contractor agrees to adhere strictly to the implementation plan. The implementation shall be subject to the City's review and approval.

Failure to adhere to the implementation schedule will constitute a breach of this Agreement, and, if incurred, an event of default, under Article 12, Default, Remedies, and Liquidated Damages.
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. 6.1 Billing
Residential Recycling Services Agreement
ARTICLE6

OTHER SERVICES
The City Council shall establish an integrated rate for the Green Waste, Recycling and Solid Waste services. Contractor shall bill and collect for its services at no more nor less than these rates. Contractor's billing plan, including billing frequency, and format shall be subject to approval by City, and City shall have the right to revise the billing format to itemize certain charges.

The City may also direct Contractor to insert mailers relating to contractor provided services with the billings and shall be responsible for all labor costs with respect to the mailing inserts.

The mailers must fit in standard envelopes and not increase the required postage. The City will provide not less than thirty (30) days notice to Contractor prior to the mailing date of any proposed mailers to permit Contractor to make appropriate arrangements for inclusion of City materials.

Contractor shall maintain copies of said billings and receipts, each in chronological order, for a period of three (3) years after the date of service for inspection by the City. Contractor may, at its option, maintain those records in computer form, on microfiche, or in any other manner, provided that the records cannot be altered, and can be preserved and retrieved for inspection and verification in a timely manner.

The owner of occupied Premises shall be responsible and liable for paying the Recycling fees for that property.
· 6.2 Collection of Bills from Delinquent Customers
Once each year, prior to a date established by the City, Contractor may take actions pursuant to Chapter 8.04 of the Municipal Code to collect delinquent accounts.

6.3 Periodic Performance or Billing Audit
The City shall have the right to periodically, not less than annually, request a performance audit or billing audit be completed by the Contractor, the City or an independent third party. The City shall be entitled to select the type of consultant that it deems qualified to conduct said audits. The cost of such audits will be an allowable cost under the rate setting methodology unless there are findings pursuant to Section 12.5.

6.4 Customer Service

6.4.1 Office
Office hours shall be, at a minimum, from 8:00 AM. to 5:00 P.M., Monday through Friday, exclusive of holidays. A responsible and qualified representative of Contractor shall be 19

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available during office hours for communication with the public. Telephone numbers shall either be a local or a toll free call to residents and businesses of the City. Contractor's telephone system shall be adequate to handle the volume of calls typically experienced on the busiest days. Contractor shall also maintain a local or toll free telephone number for use during other than normal business hours. Contractor shall have a representative, answering or message providing/receiving (voice-mail) service available at said after hours telephone number.

6.4.2 Complaint documentation
All service complaints related to Recyclable Materials Collection shall be directed to Contractor. Daily logs of complaints concerning Coll~ction of Recyclable Materials shall be retained for a minimum of twenty-four (24) months and shall be available to City at all times during this Agreement upon twenty-four (24) hour notice.

Contractor shall log all complaints received orally or in writing and said log shall include the date and time the complaint was received, name, address and telephone number of complainant to the extent that such information is provided by complainant, description of complaint, employee recording complaint and the action taken by Contractor to respond to and remedy complaint. All complaints received shall be responded to within twenty four (24) working hours of receipt. ·
All customer service records and logs kept by Contractor shall be available at all times during this Agreement to City upon twenty four (24) hour notice and at no cost to City. City shall, at any time during regular Contractor business hours, have access to Contractor's customer service department for purposes of monitoring the quality of customer service or researching customer complaints assessing liquidated damages or other matters related to Contractor's performance under this Agreement.

6.4.3 Resolution of Customer Complaints
Contractor shall notify customers of this complaint procedure at the time customers apply for or are provided service, and subsequently, annually.

A customer dissatisfied with Contractor's decision regarding a complaint may ask the City to review the complaint. The City's Utilities Director shall determine if the customer's complaint is justified, and if so, what remedy, if any shall be provided. The remedy under this Section shall be limited to a rebate of customer charges related to the period of breach of any of the Terms of this Agreement. Any resolution of these customer complaints shall not affect the City's rights to liquidated damages.

6.4.4 Government Liaison
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Contractor shall designate in writing a "Government Liaison" who shall be responsible for working with the City Manager, Utilities Director and/or one of their designated representative(s) to resolve customer complaints.

6.5 Education and Public Awareness
Contractor acknowledges and agrees that education and public awareness are critical, key and essential elements of any efforts to achieve AB 939 requirements and has submitted a plan to this effect in Exhibit "A". Accordingly, Contractor agrees to cooperate with City in exploring opportunities to expand public and customer knowledge concerning needs and methods to reduce, reuse and recycle Solid Waste and "to cooperate fully with City in this regard.

Contractor shall perform all necessary public education .activities related to the Recycling services as presented in Exhibit "A". This shall include, but not be limited to, annual mailings to all customers explaining the recycling program, mailings prior to the start of services, flyers handed out with Container delivery and follow-up mailings or handouts related to the collection of new materials. All Public education materials shall be approved in advance by the City.

At the direction of the City Manager and/or Utilities Director, Contractor shall participate in and promote Recycling and other diversion techniques at community events and local activities.

Such participation would normally include providing, without cost to the City, educational and publicity information promoting the goals of the City's AB 939 programs. 21

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7.1 Franchise Fee
Residential Recycling Services Agreement
ARTICLE7

PAYMENTS TO CITY
In consideration of the exclusive franchise provided for in this Agreement, Contractor shall pay the City ten percent (10%) of its gross revenues for residential recycling services; provided, however, that such franchise fee shall not exceed the costs incurred by the City to deliver service to properties. Such franchise fee shall be a "pass-through" expense for purposes of rate review.

7.2 AB 939 Fee
If requested by City, Contractor shall pay an AB 939 fee, to be specified annually by the City.

All AB 939 fees paid to the City shall be considered a pass through cost for purposes of rate setting.
7 .3 Business License Tax
Contractor shall pay each annual business license tax.

7.4 Other Fees
The City shall reserve the right to set "Other" Fees, as it deems necessary. These expenses will be determined and a fee designed to reimburse the City. Such fees shall be set annually by City resolution and may be considered a pass through cost for purposes of rate setting.

7.5 Time and Method of Payment
If ContraCtor is directed to pay an AB 939, Franchise Fee or "Other" Fee, it shall do so on or before the fifteenth (15th) day of each month during the Term. Contractor shall remit to City a sum of money equal to the designated percentage of the gross revenue, including Recyclable Materials revenue, or a flat monthly fee as determined by the City. If any fees are not paid on or before the fifteenth (15th) day of any month, Contractor shall pay to City a late payment penalty in an amount equal to one percent (1 %) 'of the amount owing for that month.

Contractor shall pay an additional late payment penalty of one percent (1 %) owing on any unpaid balance for each following thirty (30) day period the fee remains unpaid. Late payment penalty amounts shall not be included in any revenue requirement.

7.6 Adjustment of Fees
The City may adjust the amount of fees annually. Such adjustment shall be reflected in the rates that the Contractor is allowed to charge and collect from customers.

7.7 Review of Fee Payments
The City, or its agent, reserves the right to annually perform an independent review of fee payments, to verify that fees are being paid in accordance with Agreement. The cost of such 22

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reviews will be an allowable cost under the rate setting methodology unless there are findings pursuant to Section 12.5.
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ARTICLES

CONTRACTOR'S COMPENSATION AND RATES

8.1 General
Contractor's compensation provided for in this Article shall be the full, entire and complete compensation due to Contractor pursuant to this Agreement for all labor, equipment, materials and supplies, taxes, insurance, bonds, overhead, profit and all other things necessary to perform all the services required by this Agreement in the manner and at the times prescribed.

The Contractor does not look to the City for payment of any sums under this Agreement.

The City shall have the right to structure those rates as it deems appropriate so long as the revenues forecasted to be received by Contractor from charging such rates can reasonably be expected to generate sufficient revenues to provide for Contractor's compensation.

8.2 Initial Rates
Contractor will submit required financial documentation for this service as part of an integrated solid waste rate application. The rate application will comply with the guidelines set forth in the City's "Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates". The portion of the rate attributable to this service shall be identified as part of the Council rate-setting process but will not be separated from the integrated rate.

8.3 Subsequent Rates
Contractor may request rate revisions in future solid waste rate applications. The rate application must comply with the "City of San Luis Obispo Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates".

8.4 Right to Perform Rate Reviews
City reserves the right to perform, or have a qualified third party perform, a detailed review of Contractor's expenses and revenues for the purposes of adjusting rates. The results of this detailed rate review will be used to adjust rates, and the Contractor's calculated revenue requirements will be used the following year to adjust rates according to Section 8.3 Contractor's Compensation for subsequent Rate Years.

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significant changes in Contractor's workload due to new residential or commercial development. However, when an extraordinary adjustment is requested, such adjustment shall consider changes in all costs and revenues from Contractor's proposed revenue requirement.

For each such request, Contractor shall prepare a schedule comparing the original proposed costs and revenues by line item to the then current costs and revenues, including an estimates of the cost impact of the change, using an operating ratio of 93%, applied to Contractor's costs as calculated in Contractor's proposed revenue requirement. Such request shall be prepared in a form acceptable to City with support for assumptions made by Contractor in preparing the estimate. Contractor and City shall negotiate a mutually acceptable adjustment amount. 25

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ARTICLE9

RECORDS, REPORTS AND INFORMATION, STUDIES

AND HEARING REQUIREMENTS

9.1 Records

9.1.1 General
Contractor shall maintain records required to conduct its operations, to support requests it may make to City, and to respond to requests from City in the conduct of City business.

Additionally, the Contractor shall also keep and maintain records reasonably necessary for audits, as required by this Agreement, and shall keep and maintain all records reasonably necessary to develop reports and financial statements required with respect to this Agreement.

Adequate record security shall be maintained to preserve records from events that can be reasonably anticipated such as a fire, theft and earthquake. Electronically maintained data/records shall be protected and backed up.

9.1.2 Financial Records
Financial records shall separate all records related to the services performed under this Agreement from any and all other types of businesses and operations conducted by the Contractor.

9.1.3 General Records
City approved records (format) shall be maintained for the City separate from other jurisdictions relating to:
• Customer services;
• Weight of Recyclable Materials by type of materials.
• Routes;
• Facilities, inventory of equipment and personnel used; • Facilities and equipment operations, maintenance and repair; • Processing, marketing and sale of Recyclable Materials includ\ng name of the purchaser, the date of sales transaction, processing cost per ton, quantity purchased, value per ton and net sales records;
• Complaints; and,
• Missed pick ups.

Contractor shall maintain records of all Recyclable Materials Collected in the City for the period of this Agreement. In the event Contractor discontinues providing Recycling services to City, Contractor shall provide all records of all Recyclable Materials Collected in City to City within thirty (30) days of discontinuing service. Records shall be in chronological and organized form and readily and easily interpreted.
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9.2 Reports

9.2.1 Report Formats and Schedule
Records shall be maintained in forms and by methods that facilitate flexible use of data contained in them to structure reports, as needed. Contractor may propose report formats that are responsive to the objectives and audiences for each report. The format of each report shall be approved by the City.

Monthly reports shall be submitted within twenty (20) calendar days after the end of the month. being reported. Annual reports shall be submitted before September 30th, for the previous reporting year.

9.2.2 Monthly Reports
The information listed shall be the minimum reported:
• Recyclable Materials collected, sorted by type of Generator, in tons; by month, and cumulative for report year.
• Complaint summary, for month and cumulative for report year. • Narrative summary assessment of problems encountered and actions taken with recommendations to City for improvement.
• Number of accounts by category for each month of reporting year. • Participation rates.
• Recyclable Materials Container distribution.
• Materials Sales. Sales statement showing: kinds of material, quantity sold (in tons), value per ton, and net sales.

The City may designate any additional information that it wishes provided in the monthly reports.

9.2.3 Annual Report
The Annual Report is to be essentially in the form and content of the monthly reports. In addition, Contractor's annual audited financial reports/statements, with the operations related to the City services segregated, shall be included. The annual report shall also include a complete inventory of equipment used to provide all services.

Financial statements shall include a supplemental schedule combining Contractor's results of operations, separating the specific revenues and expenses, including detailed information with respect to general overhead claimed by the Contractor, in connection with the operations provided for in this Agreement from others included in such financial statements. The financial statements, supplemental schedule, management letter and footnotes shall be prepared in accordance with Generally Accepted Accounting Principles (GAAP) and audited, in accordance with Generally Accepted Auditing Standards (GAAS) by a certified public accountant (CPA) licensed (in good standing) to practice public accounting in the State of California as 27

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determined by the State of California Department of Consumer Affairs Board of Accountancy.

The CPA opinion on Contractor's annual financial statements and supplemental schedule shall be unqualified, except as to uncertainties for which the ultimate outcome cannot be determined by the date of the CP A's opinion.

The City retains the right to have an independent third party or agent of the City's choosing, such as a CPA, participate in the records inspection. The cost of such inspection or review will be an allowable cost under the rate setting methodology unless there are findings pursuant to Section 12.5.

9.3.1 Right to Review Basis for Landfill Tipping Fee Increases The Contractor shall provide to the City a copy of Cold Canyon Landfill's request for an increase in tipping fees no later than five (5) days following submittal of said request to the County of San Luis Obispo. Additionally, the Contractor shall notify the City of the action taken by the Board of Supervisors regarding said request within five (5) days following said action, including letter to the Board of Supervisors and related executed resolution. The City retains the right to have an independent third party or agent of the City's choosing, such as a CPA, participate in the review. The cost of such inspection or review will be an allowable cost under the rate setting methodology unless there are findings pursuant to Section 12.5.

9.4 Waste Generation/Characterization Studies
Contractor acknowledges that the city must perform Solid Waste generation and disposal characterization studies periodically to comply with AB 939 requirements. Contractor agrees to participate and cooperate with City and its agents to accomplish studies and data collection and prepare reports as needed to determine weights and volumes of Solid Waste generated, diverted, disposed, transformed, or otherwise handled/processed to satisfy AB 939 requirements.
9 .5 Performance Hearing
The City maintains the right to hold a public hearing at any time, not more than once each year, at which the Contractor shall be present and shall participate, to review its services and performance. The purpose of the hearing is to provide for a discussion and review of technological, economic, and regulatory changes in order to achieve a continuing, advanced Solid Waste management system; and to ensure customer service quality and any other areas 28

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that may be addressed regarding services are being provided with adequate quality, efficiency and economy.

Sixty (60) days after receiving notice from City of a Performance Hearing, Contractor shall, at a minimum, submit a report to City indicating (1) changes recommended and/or new services to improve City's ability to meet the goals of AB 939 and to contain costs and minimize impacts on rates; and (2) any specific plans for provision of changed or new services by Contractor. 29

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10.1 Indemnification
Residential Recycling Services Agreement
ARTICLE 10

Contractor further agrees to and shall, upon demand of City, at Contractor's sole cost and expense, defend (with attorneys acceptable to City) the City, its officers, directors, employees, and agents against any claims, actions, suits or other proceedings, whether judicial, quasijudicial or administrative in nature, arising or resulting from any events described in the immediately preceding paragraph to the extent arising from or related to Contractor's alleged or actual violations of Proposition 218 and/or its implementing legislation,.

Contractor's duty to indemnify and defend shall survive the expiration or earlier termination of this Agreement.

10.2 Landfill Diversion
The Contractor acknowledges that the City has adopted a SRRE which selects a single family curbside Recycling program as a means of diverting an estimated 3,643 tons in 1995 and 3,903 tons per year by the year 2000, and a multi-family curbside Recycling program as a means of diverting an estimated 308 tons in 1995 and 330 tons per year by the year 2000. It is therefore of foremost importance that the Recyclable Materials collected under this Agreement be converted into a functional and marketable product in order that the materials may be diverted from landfill disposal in compliance with the City's SRRE, and AB 939. The Contractor shall therefore use commercially reasonable efforts ensure that the processing method used shall, at all times, meet the intent of the City's SRRE and AB 939. Should the Contractor find it necessary to utilize another method of processing in order to meet the intent of the SRRE and AB 939, the City shall be given an opportunity to make its own determination as to the suitability and cost-effectiveness of such process and shall approve such process in writing.

The City shall have the right to terminate this Agreement upon the giving of a six (6) month 30

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prior written notice to Contractor should it be determined that the Recycling program being implemented and/or proposed under this Agreement is ineffective in meeting the City's diversion goals and objectives. Upon termination, the Contractor shall be entitled only to revenues less expenses incurred to that date. All revenues received thereafter, including from Recyclable Materials sales, shall be the property of the City unless otherwise agreed.

10.3 AB 939 Indemnification
Contractor agrees to indemnify and hold harmless City, its officers, Directors, employees, and agents from and against all fines and/or penalties imposed by the California Integrated Waste Management Board in the event the source reduction and Recycling goals or any other requirement of AB 939 are not met by City with respect to the waste stream Collected under this Agreement but only to the extent that such failure is due to the failure of Contractor to meet its obligations under this Agreement or for delays in providing information that prevents City from submitting reports required by AB 939 in a timely manner.

10.4 Insurance
A. Minimum Limits of Insurance. Contractor shall maintain limits no less than:

1. Comprehensive General Liability: One Million Dollars ($1,000,000) combined single limit per occurrence for bodily injury, Personal injury and property damage.

2. Automobile Liability: One Million Dollars ($1,000,000) combined single limit per accident for bodily injury and property damage.

3. Workers' Compensation and Employers Liability: Workers' compensation limits as required by the Labor Code of the State of California and Employers Liability limits of $1,000,000 per accident.

B. Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its officials, directors and employees; or Contractor shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses.

C. Other Insurance Provisions. The policies are to contain, or be endorsed to contain, the following provisions:

1. General Liability and Automobile Liability Coverages a) The City, its officials, employees, and directors are to be covered as insured as respects:. liability arising out of activities performed by or on behalf of Contractor; products and completed operations of Contractor; Premises owned, leased or used by Contractor; or automobiles owned, leased, hired or borrowed by Contractor. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officials, or employees.
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b) Contractor's insurance coverage shall be primary insurance as respects City, its officials, directors, and employees. Any insurance or self-insurance maintained by City, its officials, employees or volunteers shall be excess of Contractorts insurance and shall not contribute with it.
c) Any failure to comply with reporting provisions of the policies shall not affect coverage provided to City, its officials, or employees. d) Coverage shall state that Contractor's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability.

2. Workers' Compensation and Employers Liability Coverage - The insurer shall agree · to waive all rights of subrogation against City, its officials, employees and volunteers for losses arising from work performed by Contractor for City.

3. All Coverages - Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or limits except after thirty (30) days prior written notice by certified mail, return receipt requested, has been given to City.

D. Acceptability of Insurers. The insurance policies required by this Section shall be issued by an insurance contractor or companies admitted to do business in the State of California subject to the jurisdiction of the California Insurance Commissioner and with a rating in the most recent edition of Best's Insurance Reports of size category VII or larger and a rating classification of A or better.

E. Verification of Coverage. Contractor shall furnish City with certificates of insurance and with original endorsements affecting coverage required by this clause. The certificates and endorsements for each insurance policy are to be signed by a Person authorized by that insurer to bind coverage on its behalf. The certificates and endorsements are to be on forms provided by or acceptable to City and are to be received and approved by City before work commences. City reserves the right to require complete, certified copies of all required insurance policies, at any time.

10.5 Faithful Performance Bond
Simultaneously with the execution of this Agreement, Contractor shall file with City surety bond, payable to City, securing Contractor's faithful performance of its obligations under this Agreement. The bond shall be in the amount of 125% of the total annual contract price 32

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guaranteeing the faithful performance of the contract, including any attorney's fees or other collection costs.
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ARTICLE 11

CITY'S RIGHT TO PERFORM SERVICE

11.1 General
In the event that Contractor, for any reason whatsoever, fails, refuses or is unable to Collect, transport, process or market any or all recyclable Materials which it is required by this Agreement to Collect, process and market, at the time and in the manner provided in this Agreement, for a period of more than seven (7) calendar days, and if, as a result thereof, Recyclable Materials should accumulate in the City to such an extent, in such a manner, or for such a time that the City Manager should find that such accumulation endangers or menaces the public health, safety or welfare, then City shall have the right, but not the obligation, upon twenty-four (24) hour prior written notice to Contractor during the period of such emergency as determined by the City Manager, (1) to perform, or cause to be performed, such services itself with_ its own or other personnel without liability to Contractor; and/or (2) to take possession of any or all of Contractor's land, equipment and other property to Collect, transport, process and/or market any Recyclable Materials generated within the City which Contractor would otherwise be obligated to Collect, transport, process or market pursuant to this Agreement. In the event the City takes possession of the Contractor's equipment and other property, the City shall be entitled to have another contractor operate such equipment and property under City direction. Additionally, in the event the City takes possession of the Contractor's equipment and other property, the City does not guarantee repair of existing problems with equipment and facilities.

Notice of Contractor's failure, refusal or neglect to Collect, transport, process or market Recyclable Materials may be given orally by telephone to Contractor at its principal office and shall be effective immediately. Written confirmation of such oral notification shall be sent to Contractor within twenty-four (24) hours of the oral notification.

Contractor further agrees that in such event:
• It will take direction from City to effect the transfer of possession of property to City for City's use.
• It will, if City so requests, keep in good repair and condition all of such property, provide all motor vehicles with fuel, oil and other service, and provide such other service 'as may be necessary to maintain said property in operational condition. • City may immediately engage all or any personnel necessary or useful for the Collection, transportation, processing and/or marketing of Recyclable Materials, including, if City so desires, employees previously or then employed by Contractor, Contractor further agrees, if City so requests, to furnish City the services of any or all management or office personnel employed by Contractor whose services are necessary 34

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or useful for Recyclable Materials Collection, Transportation, processing and marketing operations and for the billing and collection of fees for these services.

City agrees that it assumes complete responsibility for the proper and normal use of such equipment and facilities while in its possession.

If the interruption or discontinuance in service is caused by any of the reasons listed in Section

12.4 (Excuse From Performance), City shall pay to Contractor the reasonable rental value of the equipment and facilities, possession of which is taken by City, for the period of City's possession, if any, which extends beyond the period of time for which Contractor has rendered bills in advance of service.

Except as otherwise expressly provided in the previous paragraph, City's exercise of its rights under this Article 11 (1) does not constitute a taking of private property for which compensation must be paid; (2) will not create any liability on the part of City to Contractor; and (3) does not exempt Contractor from the indemnity provisions of Article 10, Indemnification, Insurance and Bond, which are meant to extend to circumstances arising under this Section, provided that Contractor is not required to indemnify City against claims and damages arising from the sole negligence of City officers, employees and agents in the operation of Collection vehicles during the time City has taken possession of such vehicles.

11.2 Temporary Possession of Contractor's Property
If the City suffers an interruption or discontinuance of service as described in Section 11. I (including interruptions and discontinuance due to events described in Section 12.4, Excuse from Performance), City may take possession of and use all of Contractor's property described above until other suitable arrangements can be made for the provision of Recycling Services which may include the grant of a Contract to another company. The same notice requirements of Section 11.1 are applicable.

11.3 Billing and Compensation to City During City's Possession During such time that city is providing Recycling services, as above provided, Contractor shall continue to bill and collect payment from all users of the above-mentioned services. Contractor further agrees that, in such event, it shall reimburse City for any and all costs and expenses incurred by City in taking over possession of the above-mentioned property for Recycling service in such manner and to an extent as would otherwise be required of Contractor under the Terms of this Agreement. Such reimbursement shall be made from time to time after submission by City to Contractor of each statement listing such costs and expenses, but in no event later than five (5) working days from and after each such submission. The City shall have the right, at its sole discretion, to take over billing and payment collection activities. The City shall then pay any net revenues to the Contractor, after deducting all expenses, including Cityincurred expenses. 35

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11.4 City's Right to Relinquish Possession
It is further mutually agreed that City may at any time at its discretion relinquish possession of any or all of the above-mentioned property to Contractor and thereupon demand that Contractor resume the Recycling services as provided in this Agreement, whereupon Contractor shall be bound to resume the same.

11.5 Duration of City's Possession
City's right pursuant to this Article to retain temporary possession-of Contractor's facilities and equipment, and to render Collection services, shall terminate when City determines that such services can be resumed by Contractor, or when City no longer reasonably requires such facilities or equipment. In any case, City has no obligation to maintain possession of Contractor's property and/or continue its use for any period of time and may at any time, in its sole discretion, relinquish possession to Contractor.
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ARTICLE 12

DEFAULT, REMEDIES AND LIQUIDATED DAMAGES

12.1 Events of Default
All provisions of this Agreement to be performed by Contractor are considered material. Each of the following shall constitute an event of default.

A. Fraud or Deceit. If Contractor practices, or attempts to practice, any fraud or deceit upon city.

B. Insolvency or Bankruptcy. If Contractor becomes insolvent, unable, or unwilling to pay its debts when due, or upon listing of an order for relief in favor of Contractor in a bankruptcy proceeding. The Contractor is also in default if there is an assignment for the benefit of its creditors.

C. Failure to Maintain Coverage. If Contractor fails to provide or maintain in full force and effect the Workers' Compensation, liability, indemnification coverage or any insurance coverage or bond required under this Agreement.

D. Violations of Regulation. If Contractor facilities fall out of full regulatory compliance or if Contractor violates any orders or filings of any regulatory body having jurisdiction over Contractor relative to this Agreement, provided that Contractor may contest any such orders or filings by appropriate proceedings conducted in good faith, in which case no breach of the Agreement shall be deemed to have occurred.

E. Failure to Perform. If Contractor ceases to provide Recycling services as required under this Agreement for a period of two (2) days or more, for any reason within the control of Contractor.

F. Failure to Pay/Report. If Contractor fails to make any timely payments, including liquidated damages and penalties, required under this Agreement and/or fails to provide City with required information, reports, and/or records in a timely manner as provided for in the Agreement.

G. Acts or Omissions. Any other act or omission by Contractor which violates the terms, conditions, or requir"ements of this Agreement, the California Integrated Waste Management Act of 1989, as it may be amended from time to time, or any order, directive, rule, or regulation issued thereunder and which is not corrected or remedied within the time set in the written notice the violation or, if Contractor cannot reasonably correct or remedy the breach within the time set forth in such notice, if Contractor should fail to commence to correct or remedy such 37

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Residential Recycling Services Agreement
violation within the ~ime set forth in such notice and diligently effect such correction or remedy thereafter.

H. False or Misleading Statements. Any representation or disclosure made to City by Contractor in connection with or as an inducement to entering into this Agreement, or any future amendment to this Agreement, which proves to be false or misleading in any material respect as of the time such representation or disclosure is made, whether or not any such representation or disclosure appears as part of this Agreement.

I. Attachment. There is a seizure of attachment of, or levy on, the operating equipment of Contractor, including without limits its equipment, maintenance or office facilities, or any part thereof.

J. Suspension or Termination of Service. There is any termination or suspension of the transaction of business by Contractor, including without limit, due to labor unrest including strike, work stoppage or slowdown, sickout, picketing, or other concerted job action lasting more than two (2) days.

Upon default by the Contractor, the City Manager shall provide written notice to Contractor of the violation. The City Manager shall include in the notice, a demand that the Contractor correct the violation within 10 days following the delivery of said notice. For purposes of this Agreement and any notice required thereunder, the term "days" shall mean calendar days.

12.2 Right to Terminate Upon Default
Upon a default by Contractor, City shall have the right to terminate this Agreement upon aten (10) days notice if the public health or safety is threatened, or otherwise a thirty (30) days notice, but without the need for any hearing, suit or legal action. This right of termination is in addition to any other rights of City upon a failure of Contractor to perform its obligations under this Agreement. ·
City's right to terminate this Agreement and to take possession of Contractor's equipment and facilities are not exclusive, and City's termination of this Agreement shall not constitute an election of remedies. Instead, they shall be in addition to any and all other legal and equitable rights and remedies which City may have.

By virtue of the nature of this Agreement, the urgency of timely, continuous and high-quality service, the lead time required to effect alternative service, and the rights granted by City to Contractor, the remedy of damages for a breach hereof by Contractor is inadequate and City shall be entitled in injunctive relief.

12.3 Liquidated Damages
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A. General. City finds, and Contractor agrees, that as of the time of the execution of this Agreement, it is impractical, if not impossible, to reasonably ascertain the extent of damages which shall be incurred by City as a result of a breach by Contractor of its obligations under this Agreement.

B. Service Performance Standards; Liquidated Damages for Failure to Meet Standards.

The parties acknowledge that consistent, reliable Recycling service is of utmost importance to City and that city has considered and relied on Contractor's representations as to its quality of service commitment in awarding the Agreement to it. The parties further recognize that some quantified standards of performance are necessary and appropriate to ensure consistent and reliable service and performance. The parties further recognize that if Contractor fails to achieve the performance standards, comply with complaint resolution criteria, or fails to submit required documents in a timely manner, City and its residents will suffer damages and that it is and will be impractical and extremely difficult to ascertain arid determine the exact amount of damages which City will suffer. Therefore, without prejudice to City's right to treat such nonperformance as an event of default under this Article 12, the parties agree that the following liquidated damage amounts represent a reasonable estimate of the amount of such damages considering all of the circumstances existing on the date of this Agreement, including the relationship of the sums to the range of harm to City that reasonably could be anticipated and the anticipation that proof of actual damages would be costly or inconvenient. Recognizing the importance ofresolving any failure to meet the service performance standard, the City shall contact Contractor within two (2) days of any failing reported directly to the City.

Contractor agrees to pay (as liquidated damages and not as a penalty) the amounts set forth below:

Collection Reliability and Quality
• For each failure over five (5) annually to commence service to a new customer account within seven (7) days after order:
• For each failure over ten (10) annually to Collect Recyclable Materials, which as been properly set out for Collection, from an established customer account on the scheduled Collection day:
• For each failure to Collect Recyclable Materials which have been properly set out for Collection, from the same customer on two (2) consecutive scheduled pickup days:
• For each occurrence over five (5) annually of damage to private property:
• For each occurrence of discourteous behavior:
• For each failure over ten (10) annually to clean up Recyclable Materials spilled from Bins:
• For each occurrence over five (5) annually of Collecting 39 $150.00
$150.00
$150.00
$250.00
$250.00
$150.00

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Residential Recycling Services Agreement
• Recyclable Materials during unauthorized hours:
• For each failure to respond to a customer complaint within twenty-four (24) working hours:

Timeliness of Submissions to City
$250.00
$100.00
REPORTS Any report shall be considered late until such time as a correct and complete report is received by City. For each calendar day a report is late, the daily assessment shall be:

Monthly Reports:

Annual Reports:

For each infraction
For each infraction
$100 per day
$500 per day
Liquidated damages will only be assessed after Contractor has been given the opportunity but failed to rectify the dan:iages, as described in this Agreement (e.g., twenty-four (24) working hours to respond to a complaint). City may determine the occurrence of events giving rise to liquidated damages through the observation of its own employees or representative or investigation of customer complaints.

Prior to assessing liquidated damages, City shall give Contractor notice of its intention to do so.

The notice will include a brief description of the incident(s)/non-performance. Contractor may review (and make copies at its own expense) all information in the possession of City relating to incident(s)/non-performance. Contractor may, within ten (I 0) days after receiving the notice, request a meeting with City. If a meeting is requested, it shall be held by the City Manager or his/her designee. Contractor may present evidence in writing and through testimony of its employees and others relevant to the incident(s)/non performance. The City Manager or designee will provide Contractor with a written explanation of his or her determination on each incident(s)/non-performance prior to authorizing the assessment of liquidated damages. The decision of the City Manager or designee shall be final.

C. Amount. The City Manager may assess liquidated damages for each calendar day or event, as appropriate, that Contractor is determined to be liable in accordance with this Agreement.

D. Timing of Payment. Contractor shall pay any liquidated damages assessed by City within ten (10) days after they are assessed. If they are not paid within the ten (I 0) day period, City may proceed against the performance bond required by this Agreement or order the termination of this Agreement, or both.

12.4 Excuse from Performance
The parties shall be excused from performing their respective obligations hereunder in the event they are prevented from so performing by reason of floods, earthquakes, other "acts of God", war, civil insurrection, riots, acts of any government (including judicial action), and other similar catastrophic events which are beyond the control of and not the fault of the party 40

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claiming excuse from performance hereunder. Labor unrest, including but not limited to strike, work stoppage or slowdown, sick-out, picketing, or other concerted job action conducted by Contractor's employees or directed at Contractor or its selected facilities is not an excuse from performance and Contractor shall be obligated to continue to provide service notwithstanding the occurrence of any or all such events.

The party claiming excuse from performance shall, within two (2) days after such party has notice of such cause, give the other party notice of the facts constituting such cause and asserting its claim to excuse under this Section.

The interruption or discontinuance of Contractor's services caused by one or more of the events excused shall not constitute a default by Contractor under this Agreement. Notwithstanding the foregoing, however, if Contractor is excused from performing its obligations hereunder for any of the causes listed in this Section for a period of seven (7) days or more, City shall have the right to review the circumstances under which the excuse from performance was granted. After such review, if the City determines the excuse from service is no longer valid, the City shall notify the Contractor in writing to resume service within two (2) days from the receipt of such notification. If the Contractor fails to resume service within the two (2) days, the City shall have the right to terminate this Agreement by giving ten (1 O) days notice, in which case the provisions relative to taking possession of Contractor's land, equipment and other property and engaging Contractor's personnel in Article 11, City's Right to Perform Services, and this Article 12 shall apply.

12.5 Financial Material Errors, Omissions or Irregularities The City may review, test and audit the books and records of the Contractor for the purpose of determining whether the Contractor is complying with the terms of the Agreement. In the event that material errors or omissions or irregularities are identified, then the cost associated with the audit, test or review shall be paid by the Contractor to the City. In the case of errors, materiality shall be deemed to be two percent (2%) or greater of the gross revenues of the Contractor from . activities performed under this agreement. Recovery of any over payment will be negotiated on a case by case basis, either immediately or through the next rate setting evaluation. 41

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ARTICLE 13

OTHER AGREEMENTS OF THE PARTIES

13.1 Relationship of Parties
The parties intend that Contractor shall perform the services required by this Agreement as an independent Contractor engaged by City and not as an officer or employee of City nor as a partner of or joint venture with City. No employee or agent or Contractor shall be or shall be deemed to be an employee or agent of City. Except as expressly provided herein, Contractor shall have the exclusive control over the manner and means of conducting the Recycling services performed under this Agreement, and all Persons performing such services. Contractor shall be solely responsible for the acts and omissions of its officers, employees, subcontractors and agents. Neither Contractor nor its officers, employees, subcontractors and agents shall obtain any rights to retirement benefits, workers compensation benefits, or any other benefits Which accrue to City employees by virtue of their employment with City.

13.2 Compliance with law
In providing the services required under this Agreement, Contractor shall at all times, at its sole cost, comply with all applicable laws of the United States, the State of California, City, and with all applicable regulations promulgated by federal, state, regional or local administrative and regulatory agencies, now in force and as they may be enacted, issued or amended during the Term.

13.3 Governing Law
This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of California.

13.4 Jurisdiction
Any lawsuits between the parties arising out of this Agreement shall be brought and concluded in the courts of the State of California, which shall have exclusive jurisdiction over such lawsuits.

13.5 Assignment
Except as may be provided for in Article 11, (City's Right to Perform Service), neither party shall assign its rights, nor delegate, subcontract or otherwise transfer its obligations under this Agreement to any other Person without the prior written consent of the other party. Any such assignment made without the consent of the other party shall be void and the attempted assignment shall constitute a material breach of this Agreement. The Contractor shall consent to any assignment to a joint powers authority, or any similar public entity assignee of the City. 42

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For purposes of this Section when used in reference to Contractor, "assignment" shall include, but not be limited to (1) a sale, exchange or other transfer of at least fifty-one percent (51 %) all of Contractor's assets dedicated to service under this Agreement to a third party; (2) a sale, exchange or other transfer of outstanding common stock of Contractor to a third party provided said sale, exchange or transfer may result in a change of control of Contractor;. (3) any dissolution, reorganization, consolidation, merger, re-capitalization, stock issuance or reissuance, voting trust, pooling agreement, escrow arrangement, liquidation or other transaction to which results in a change of ownership or control of Contractor; ( 4) any assignment by operation oflaw, including insolvency or bankruptcy, making assignment for the benefit of creditors, writ of attachment for an execution being levied against this Agreement, appointment of a receiver taking possession of Contractor's property, or transfer occurring in the event of a probate proceeding; and (5) any combination of the foregoing (whether or not in related or contemporaneous transactions) which has the effect of any such transfer or change of ownership, or change of control of Contractor.

Contractor acknowledges that this Agreement involves rendering a vital service to City's residents and businesses, and that City has selected Contractor to perform the services specified herein based on (1) Contractor's experience, skill and reputation for conducting its Solid Waste management operations in a safe, effective and responsible fashion, at all times in keeping with applicable Environmental Laws, regulations and best waste management practices, and (2) Contractor's financial resources to maintain the required equipment and to support its indemnity obligations to City under this Agreement. City has relied on each of these factors, among others, in choosing Contractor to perform the services to be rendered by Contractor under this Agreement.

If Contractor requests City's consideration of and consent to an assignment, City may deny or approve such request in its complete discretion. The City is concerned about the possibility that assignment could result in significant rate increases, as well as a change in the quality of service. Accordingly, the following standards have been set to ensure that assignment will result in continued quality service. In addition, the City reserves the right to solicit competitive bids for these services ifthe assignment results in a request by the assignee for rate increases that are higher than the inflationary index and do not reflect value changes in service standards.

At a minimum, no request by Contractor for consent to an assignment need be considered by City unless and until Contractor has met the following requirements:

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B. Contractor shall furnish City with audited financial statements of the proposed assignee's operations for the immediately preceding three (3) operating years; C. Contractor shall furnish City with satisfactory proof: 1) that the proposed assignee has at least ten (1 O) years of Recyclable Material management experience on a scale equal to or exceeding the scale of operations conducted by Contractor under this Agreement; 2) that in the last five (5) years, the proposed assignee has not suffered any significant citations or other censure from any federal, state or local agency having jurisdiction over its Solid Waste management operations due to any significant failure to comply with state, federal or local Environmental Laws and that the assignee has provided City with a complete list of such citations and censures; 3) that the proposed assignee has at all times conducted its operations in an environmentally safe and conscientious fashion; 4) that the proposed assignee conducts its Recyclable Materials management practices in accordance with sound waste management practices in full compliance with all federal, state and local laws regulating the Collection, transportation, processing, marketing and disposal of Solid Waste including Hazardous Wastes; and, 5) of any other information required by City to ensure the proposed assignee can fulfill the Terms of this Agreement in a timely safe and effective manner.

Under no circumstances shall the City be obliged to consider any proposed assignment by Contractor if Contractor is in default at any time during the period of consideration.

13.6 Subcontracting
Except as approved in writing by the City, Contractor shall not enter into an agreement to have another Person perform Contractor's duties of this Agreement. Contractor shall undertake to pay City its reasonable expenses for attorney's fees and investigation costs necessary to investigate the suitability of any proposed subcontractor, and to review and finalize any documentation required as a condition for approving any such subcontracting agreement.

13. 7 Binding on Assigns
The provisions of this Agreement shall inure to the benefit to and be binding on the permitted assigns of the parties.

13.8 Transition to Next Contractor
If the transition of servfoes to another Contractor occurs through expiration of term, default and termination, or otherwise, Contractor will cooperate with City and subsequent Contractor(s) to assist in an orderly transition which will include Contractor providing route lists and billing information. Contractor will not be obliged to sell collection vehicles or Containers to the next Contractor. Depending on Contractor's circumstances at the point of transition, Contractor at its option may enter into negotiations with the next Contractor to sell (in part or all) Collection vehicles and/or containers.
44

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13.9 Parties in Interest
Nothing in the Agreement, whether express or implied, is intended to confer any rights on any persons other than the parties to it and their representatives, successors and permitted assigns.

13.10 Waiver
The waiver by either party of any breach or violation of any provisions of this Agreement shall not be deemed to be a waiver of any breach or violation of any other provision nor of any subsequent breach of violation of the same or any other provision. The subsequent acceptance by either party of any monies which become due hereunder shall not be deemed to be a waiver of any pre-existing or concurrent breach or violation by the other party of any provision of this Agreement.

13.11 Contractor's Investigation
Contractor has relied on its own investigations, and not on any representations of the City or its agents of the conditions and circumstances surrounding the Agreement and the work to be performed by it.

13.12 Notice
All notices, demands, requests, proposals, approvals, consents and other communications which this Agreement requires, authorizes or contemplates shall be in writing and shall either be personally delivered to a representative of the parties at the address below or be deposited in the United States mail, first class postage prepaid, addressed as follows:

Ifto City:

If to Contractor:

Utilities Director
City of San Luis Obispo
879 Morro Street
San Luis Obispo, CA 93401
Tom Martin
San Luis Garbage Company
2945 McMillan #136
San Luis Obispo, CA 93401
The address to which communications may be delivered may be changed from time to time by a notice given in accordance with this Section. The notice, if mailed, is deemed served three (3) days after the mailing.

13.13 Representatives of the Parties
References in this Agreement to the "City" shall mean the City Council and all actions to be taken by City shall be taken by the City Council except as provided below. The City Council may delegate, in writing, authority to the City Manager, Utilities Director, and/or to the City employees and may permit such employees, in turn, to delegate in writing some or all of such 45

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authority to subordinate employees. Contractor may rely upon actions taken by such delegates if they are within the scope of the authority properly delegated to them.

Contractor shall, by the effective date, designate in writing a responsible officer who shall serve as the representative of Contractor in all matters related to the Agreement and shall inform City in writing of such designation and of any limitations upon his or her authority to bind Contractor. City may rely upon action taken by such designated representative as actions of Contractor unless they are outside the scope of the authority delegated to him/her by Contractor as communicated to City.

13.14 City Free to Negotiate with Third Parties
City may investigate all options for the Collection, processing and marketing of Recyclable Materials after the expiration of the Term. Without limiting generality of the foregoing, City may solicit proposals from Contractor and from third parties for the provision of Recycling services, and any combination thereof, and may negotiate and execute Agreements for such services which will take effect upon the expiration or earlier termination under Section 12.1 (Events of Default) of this Agreement.

13.15 Compliance with City Code
Contractor shall comply with those provisions of the City code which are applicable, and with any and all amendments to such applicable provisions during the Term of this Agreement.

13.16 Privacy
Contractor shall strictly observe and protect the rights of privacy of customers. Information identifying individual customers or the composition or contents of a customer's waste stream shall not be revealed to any person, governmental unit, private agency, or contractor, unless upon the authority of a court of law, by statute, or upon valid authorization of the customer.

This provision shall not be construed to preclude Contractor from preparing, participating in, or assisting in the preparation of waste characterization studies or waste stream analyses which may be required by AB 939.
46

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14.1 Entire Agreement
Residential Recycling Services Agreement
ARTICLE 14

MISCELLANEOUS AGREEMENTS
This Agreement, including the exhibits, represents the full and entire Agreement between the parties with respect to the matters covered herein.

14.2 Section Headings
The article headings and section headings in this Agreement are for convenience of reference only and are not intended to be used in the construction of this Agreement nor to alter or affect any of its provisions.

14.3 References to laws and Other Agreements
-AJ.l references in this Agreement to laws shall be understood to include such laws as they may be subsequently amended or recodified, unless otherwise specifically provided. This Agreement supersedes any and all Agreements for Recyclable Materials Collection, processing and/or marketing heretofore entered into by the parties and the City.

14.4 Interpretation
This Agreement, including the exhibits attached hereto, shall be interpreted and construed reasonably and neither for nor against either party, regardless of the degree to which either party participated in its drafting.

14.5 Agreement
This Agreement may not be modified or amended in any respect except by a writing signed by the parties.

14.6 Severability
If any non-material provision of this Agreement is for any reason deemed to be invalid and unenforceable, the invalidity or unenforceability of such provision shall not affect any of the remaining provisions of this Agreement which shall be enforced as if such invalid or unenforceable provision had not been contained herein.

14. 7 Exhibit
Exhibit "A" is attached hereto and incorporated herein and made a part hereof by this reference. 47

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IN WITNESS WHEREOF, City and Contractor have executed this Agreement as of the day and year first above written.

The City of San Luis Obispo
("City")
Attest:
cf22_ :GZ
City Clerk
San Luis Garbage Company
("Contractor")
By~--L---'=-4-=u::.._,_~__,_1-,,£=-+-~~
Name:

Title:
48

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Food and Green Waste Services Agreement

AGREEMENT

BETWEEN

THE CITY OF SAN LUIS OBISPO
AND

SAN LUIS GARBAGE COMPANY
For Collection and Disposal of Food and Green Waste
Within the City of San Luis Obispo
This Agreement (Agreement) is made and entered into thislqday of Nol/, 2015, in the State of California by and between the City of San Luis Obispo, a municipal corporation and charter city of the State of California, (City) and San Luis Garbage Company, a California corporation, (Contractor), for the Collection and processing of Food and Green Waste and the performance of other services related to meeting the goals and requirements of the California Integrated Waste Management Act of 1989.

RECITALS
This Agreement is entered into with reference to the following facts and circumstances:

I. The Legislature of the State of California, by enactment of the California Integrated Waste Management Act of 1989 (AB 939) Division 30 of the California Public Resources Code, commencing with 40000, has declared that it is within the public interest to authorize and require local agencies to make adequate provisions for Food and Green Waste handling within their jurisdictions. AB 939 requires a fifty percent (50%) reduction in the amount of waste which is landfilled by the year 2000; and

2. The separate Collection and processing of Food and Green Waste to produce usable compost was selected in the City's Source Reduction and Recycling Element adopted , June 1994 hereinafter referred to as the SRRE, as a means of meeting the 2000 State mandated diversion goals of AB 939; and

3. Since March 1997 Contractor has provided the City with green waste collection, transportation and disposal services for residential properties, multi-family dwelling units, institutional and commercial and industrial properties; and

4. On September 28, 2014, the Governor approved AB 1826 which requires each jurisdiction, on and after January 1, 2016, to implement an organic waste recycling pro gram to divert organic waste from certain businesses; and

5. In order to implement AB l 826's requirements, Contractor has proposed to enter into a long term agreement with Hitachi Zosen Inova to construct and operate a Kompogas facility at Contractor's property located at 7388 Old Santa Fe Road, San Luis Obispo, to compost food and green waste generated by the City, and
1

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6. In order to finance such facility, Contractor requires a twenty year commitment from the City to divert all food and green waste to Contractor; and

7. The City Council finds that an exclusive franchise granted to a private company for the collection and processing of Food and Green Waste is the most effective and efficient way to collect and divert residential Food and Green Waste within the City; and

8. The City Council further finds that the construction of a food and green waste processing facility is in the best interests of the City, will help promote the health, safety and welfare of the community and the environment and otherwise furthers the goals and objectives of AB 1286.

NOW, THEREFORE, for and in consideration of the mutual promises herein contained, it is hereby agreed by and between the City and Contractor as follows:

ARTICLE I

DEFINITIONS

1.1 "AB 939 means the California Integrated Waste Management Act of 1989, as it may be amended from time to time.

1.2 "Affiliate" means all businesses (including corporations, limited and general partnerships and sole proprietorships) which are directly or indirectly related to Company by virtue of direct or indirect common ownership interest or common management shall be deemed to be "Affiliated with" Contractor and included within the term "Affiliates with" Contractor and included within the "Affiliates" as used herein. An Affiliate shall include a business in which Contractor owns a direct or indirect ownership interest, a business which has a direct or indirect ownership interest in Contractor and/ or a business which is also owned, controlled or managed by any business or individual which has a direct or indirect ownership interest exists, the constructive ownership provisions of Section 3 l 8(a) of the Internal Revenue Code of 1986, as in effect on the date of this Agreement, shall apply; provided, however, that (i) "ten percent (10%)" shall be substilult:<l for "fifty percent (50% )" in Section 318(a)(2)(C) and in Section 318(a)(3)(C) thereof; and (ii) Section 318(a)(5)(C) shall be disregarded. For purposes of determining ownership under this paragraph and constructive or indirect ownership under Section 3 l 8(a), ownership interest of less than ten percent (10%) shall be determined on the basis of the percentage of voting interest or value which the ownership interest represents, whichever is greater.

1.3 "Agreement" means this Food and Green Waste Agreement (dated ll/1"/i5:°including all exhibits and attachments, and any amendments thereto) between City and Contractor for Collection, processing and marketing of Food and Green Waste and other services related to meeting the diversion goals and requirements of AB 939. 2

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1.4 "Billings" means any and all statements of charges for services rendered by Contractor pursuant to this Agreement.

1.5 "California Integrated Waste Management Act of 1989" means Public Resources Code §§ 40000 et. seq.

1.6 "City" means the City of San Luis Obispo, a municipal corporation and charter city, and all the territory lying within the municipal boundaries of the City as presently existing or as such boundaries may be modified during the term, acting through the City Council or the City Manager.

1.7 "Collect" or "Collection" means to take physical possession, transport, and remove Food and Green Waste within and from the City.

1.8 "Commercially Generated Food and Green Waste" means Food and Green Waste generated at commercial and/or industrial property and separated by the Waste Generator for Collection and which are excluded from the scope of this Agreement as described in Article 4, Scope of Agreement.

1.9 "Compost" means a stabilized humus product which is the result of composting.

1.10 "Composting means a controlled biological decomposition that converts raw organic matter into a stabilized humus product.

1.11 "Container" means any bin, vessel, can or receptacle used for Collection and storing Food and Green Waste before removal.

1.12 "Contractor" means San Luis Garbage Company, a corporation organized and operating under the laws of the State of California, and its officers, directors, employees, agents, companies and subcontractors where applicable.

1.13 "Environmental Laws" means all federal and state statutes, county, local and City ordinances and regulations concerning public health, safety and the environment including, by way of example and not limitation, the comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC 9601 et seq.; the Resource Conservation and Recovery Act, 42 USC 6902 et seq.; the Federal Clean Water Act, 33 USC 1251 et seq.; the Toxic Substances Control Act, 15 USC 1601 et seq.; the Occupational Safety and Health Act, 29 USC 65 1 et seq.; the California Hazardous Waste Control Act, California Health and Safety Code 25 l 00 et seq.; the California Toxic Substances Account Act, California Health and Safety Code 25300 et seq.; the Safe Drinking Water and Toxic Enforcement Act, California Health and Safety Code 25249.5 et seq.; as currently in force or as hereafter amended, and all rules and regulations promulgated thereunder.
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1.14 "Facility" means any plant or site utilized by Contractor (or a subcontractor of Contractor) for the purposes of performing the duties to fulfill this Agreement, including, without limitation, processing the City's Ureen Waste and Food Waste. For purposes of Section 2.3, "Facility" means a Kompogas facility (or other similar technology) capable of processing the City's Green Waste and Food Waste.

1.15 "Facility Operation Date" means the date on which, following its start-up, testing and commissioning, the Facility processes commercial quantities of Food and Green Waste.

1.16 "Fiscal Year" means the period commencing on January 1 and concluding December 31 for Contractor. For City it means the period commencing July 1 of one year and concluding June 30 of the subsequent year.

1.16 "Food Waste'' means a waste material of plant or animal origin that results from the preparation or processing of food for animal or human consumption and that is separated from the municipal solid waste stream. Food waste includes, but is not limited to, food waste from food facilities as defined in Health and Safety Code section 113789 (such as restaurants), food processing establishments as defined in Health and Safety Code section 111955, grocery stores, institutional cafokrias (such as prisons, schools and hospitals), and residential food scrap collection. Food waste does not include any material that is required to be handled only pursuant to the California Food and Agricultural Code and regulations adopted pursuant thereto.

1.17 "Green Waste" means tree trimmings, grass cuttings, dead plants, leaves, branches, dead trees and scrap wood (not more than six (6) inches in diameter) and similar materials generated at the premises.

1.18 "Hazardous Waste" means any discarded material or mixture of materials, which is toxic, corrosive, flammable, radioactive or which, because of its quantity, concentration, physical, chemical or infectious characteristics may do harm to either humans, animals or the environment, or as defined in Atiicle 2, Chapter 6.5 825117 of the Health and Safety Code and Public Resources Code 840141.

1.19 "Materials Recovery Facility" means a permitted Facility where Solid Waste, Recyclable Materials, Food or Green Waste are sorted or separated for the purposes of Recycling, Composting or reuse.

1.20 "Multi-family Dwelling Unit" means any Premises, other than a Single Family Dwelling Unit, used for residential purposes, irrespective of whether residence therein is transient, temporary or permanent.

1.21 "Owner" means the person holding the legal title to the real property constituting the Premises to which Food and Green Waste collection service is to be provided under this Agreement. 4

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1.22 "Person" means any individual, firm, association, organization, partnership, corporation, business trust, joint venture, the United States, the State of California, the County of San Luis Obispo, local agencies, cities and special purpose districts.

1.23 "Premises" means any land or building in the City where Solid Waste is generated or accumulated.

1.24 "Recyclable Materials" means residential by-products or discards of economic value set aside, handled, packaged or offered for Collection in a manner different from Solid Waste.

Including, but not limited to, aluminum, newspaper, clear and colored glass, tin and bi-metal, High density Polyethylene (HDPE), Polyethylene Terephthalate (PET), cardboard, chipboard, and mixed paper.

1.25 "Recycling" means the process of separating for Collection, Collecting, treating and/or reconstituting Food and Green Waste which would otherwise be discarded without receiving compensation or returning them to the economy in the form of raw materials for new, reused, or reconstituted products. The Collection", transfer, transportation or disposal of Food and Green Waste not intended for, or capable of, reuse is not Recycling.

1.26 "Related Party Entity" means any Affiliate which has financial transactions with Company.

1.27 "Single Family Dwelling Unit" means each Premises used for or designated as a single family residential dwelling, including each unit of a duplex or triplex in all cases in which there is separate or individual Solid Waste Collection services.

1.28 "Solid Waste" means all putrescible and non-putrescible refuse, garbage, green waste, construction and demolition debris, rubbish, and Recyclable Materials, and as otherwise defined in Public Resources Code 40191.

1.29 "Term" means the term of this Agreement, as provided for in Article 2.

1.30 "Transfer Station" includes those facilities used to receive solid wastes, temporarily store, separate, convert, or otherwise process the materials in the solid wastes, or to transfer the solid wastes directly from smaller to larger vehicles for transport and those facilities used for transformations.

1.31 "Waste Generator" means any Person as defined by the Public Resources Code, whose act or process produces Solid Waste as defined in the Public Resources Code, or whose act first causes Solid Waste to become subject to regulation.
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Food and Green Waste Services Agreement
ARTICLE2

GRANT AND ACCEPTANCE OF AGREEMENT

2.1 Grant and Acceptance of Agreement
Subject to Section 2.5 (Conditions to the Effectiveness of Agreement), City hereby grants to Contractor an exclusive franchise to collect and process Food and Green Waste accumulating at all Premises in the City that are offered for Collection to Contractor in accordance with this Agreement.

Contractor hereby accepts the Agreement on the terms and conditions set forth in this Agreement.

2.2 Effective Date
The effective date of this Agreement shall be Nov I~, 2015.

2.3 Term of Agreement
Subject to Section 2.3.1 below, the term of this Agreement shall commence at 12:01 a.m., NOV. / °/ , 2015, and expire at midnight on the twentieth (20111) annual anniversary of the Facility Operation Date, subject to extension as provided in Section 2.4 (Option to Extend).

2.3.1 Term Contingency
The Contractor and City acknowledge that the foregoing twenty (20) year term of the Agreement is expressly contingent upon:
(a) By no later than January 1, 2018, Contractor executing a definitive long-term agreement with Hitachi Zosen !nova U.S.A. LLC (or other company approved by City) for the development, construction and operation of a Kompogas Facility (or other similar technology) capable of processing the City's Green Waste and Food Waste; and
(b) By no later than January 1, 2020, completion of a Kompogas Facility (or other similar technology) capable of processing the City's Green and Food Waste; provided, however, that in the event such Facility has not been completed by January 1, 2020, due to reasons beyond the reasonable control of, and not due to the fault or negligence of Contractor, such completion date shall be extended by the number of days reasonahly required to complete the Facility, but only to the extent that Contractor uses (and continues to use) due diligence to pursue completion of the Facility. Notwithstanding the foregoing, the term of this Agreement shall not exceed thirty five (35) years from the commencement date set forth in Section 2.3 above.
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Food and Green Waste Services Agreement
In the event Contractor does not enter into such definitive agreement and/or the facility is not constructed and operational within the time frames set forth in the Section 2.3.1, Contractor and City agree the that the term of this Agreement shall be until August 20, 2025.

In the event of a change of law or technology which would render the collection and processing services to be implemented under this Agreement obsolete, unnecessary, impractical, undesirable, or illegal, the City reserves the right to terminate this Agreement upon the giving of a six (6) month prior written notice of City's election to so terminate this Agreement. It is understood between Contractor and City that this Agreement is motivated by the passage of AB 939, and that subsequent legislation could make this Agreement unnecessary and/or adverse to the best interests of the City. In particular, City and Contractor acknowledge the possibility of future legislation changing the requirements of AB 939, and/or requiring a coordination of the collection of Solid Waste, Food and Green Waste.

2.4 Option to Extend
The City shall have the sole option to extend this Agreement up to 36 months in periods of least twelve (12) months each. If City elects to exercise this option, it shall give written notice not later than one hundred eighty (180) days prior to the initial termination date, or, if one extension has been exercised, one hundred eighty ( 180) days prior to the extended termination date.

2.5 Conditions to Effectiveness of Agreement
The obligation of City to permit this Agreement to become effective and to commence performing its obligations under this Agreement is subject to the satisfaction of each and all of the conditions set out in this Section 2.5 below, each of which may be waived in whole or in part by City.

A. Accuracy of Representations. The representations and warranties made by Contractor throughout this Agreement are accurate, true and correct on and as of the effective date of this Agreement.

B. Absence of Litigation. There is no litigation pending in any court challenging the award of this Agreement to Contractor or the execution of this Agreement or seeking to restrain or enjoin its performance.

C. Furnishing of Insurance and Bonds. Contractor has furnished evidence of the insurance and bonds required by Article 10, Indemnification, Insurance and Bond.

D. Effectiveness of City Council Action. The City's Ordinance No.l(JJ'j approving this Agreement, shall have become effective pursuant to California law on or prior to the effective date of this Agreement.

2.6 Responsibilities of City
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Food and Green Waste Services Agreemenl
The City does not assume any responsibility for, n0r shall it be held liable for damages for the failure on the part of any Person producing Food or Green Waste material within the City to deliver the same to Contractor; provided, however, it is mutually understood and agreed that the City and its officers will at all times during the period of this Agreement cooperate to enforce the terms of this exclusive Agreement as it relates to the Collection of Food and Green Waste within the City.
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Food and Green Waste Services Agreement
ARTICLE3

TERMS OF AGREEMENT

3.1 Contractor Status
Contractor is duly organized, validly existing and in good standing under the laws of the State of California and has the financial ability to perform its obligations set forth in this Agreement.

Additionally, the Contractor has no suits or threatened suits which would impair the financial ability of the Contractor to perform its obligations under this Agreement, and that the entering into this Agreement by Contractor will not in any way constitute a breach of any other agreements entered into by Contractor with other parties, or constitute a violation of any law.

3.2 Contractor Authorization
Contractor has the authority to enter into and perform its obligations under this Agreement.

The Board of Directors of Contractor (or the shareholders, if necessary) have taken all actions required by law, its articles of incorporation, its bylaws or otherwise to authorize the execution of this Agreement. The persons signing this Agreement on behalf of Contractor have the authority to do so.

3.3 Compliance with Laws and Regulations
Contractor shall comply with all existing and future City, county, state, and federal laws, including all Environmental Laws, with particular note of Article X of the City Charter and Chapter 8.04 of the Municipal Code.

3.4 Serve Without Interruption
Contractor shall Collect and process Food and Green Waste throughout the term of this Agreement without interruption except as described in Section 12.4.

3.5 Permits and Licenses
Contractor shall procure, and keep in full force and affect, all permits and licenses, pay all charges and fees, and give all notices as necessary.

3.6 Preservation of City Prope1·ty
Contractor shall pay to the City, on demand, the cost of all repairs to public property made necessary by any of the operations of Contractor under this Agreement. 9

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4.1 Scope of Agreement
Food and Green Waste Services Agreement
ARTICLE 4

SCOPE OF AGREEMENT
Subject to Section 4.2 (Limitations to Scope), the Agreement granted to Contractor shall be exclusive for Food and Green Waste Collection, except where otherwise precluded by law.

4.2 Limitations to Scope
The Agreement for the Collection and processing of Food and Green Waste granted to Contractor shall be exclusive except as to the following categories of Food and Green Waste listed in this Section. The granting of this Agreement shall not preclude the categories of Food and Green Waste listed below from being delivered to and Collected and transported by others provided that nothing in this Agreement is intended to or shall be construed to excuse any person from obtaining any authorization from City which is otherwise required by law:

A. Green Waste which are separated at any Premises and which are transported by the owner or occupant of such Premises (or by his/her employee) to a Facility; B. Green Wask removed from Premises by a gardening, landscaping, or tree trimming company as incidental part of a total service offered by that company.

Contractor acknowledges and agrees that City may permit other Persons beside Contractor to Collect any or all types of the Green Waste listed in this Section 4.2, without seeking or obtaining approval of Contractor under this Agreement.

This Agreement to Collect, transport and process Food and Green Waste shall be interpreted to be consistent with state and federal laws, now and during the term of the Agreement, and the scope of this Agreement shall be limited by current and developing state and federal laws with regard to Food and Green Waste handling and related doctrines. ln the event that future interpretations of current law, enactment or developing legal trends limit the ability of the City to lawfully provide for the scope of services as specifically set forth herein, Contractor agrees that the scope of the Agreement will be limited to those services and materials which are lawfully provided for under this Agreement. The City shall not be responsible for any lost profits and/or damages claimed by the Contractor as a result of changes in law.

4.3 Administration of Agreement
The City Manager shall administer this Agreement and the City's Utilities Director shall supervise Contractor's compliance with the Agreement terms and conditions.

4.4 Use of Citv Streets
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Food and Green Waste Services Agreement
This Agreement shall give Contractor the right and privilege to operate Food and Green Waste Collection vehicles and equipment on such streets, public ways, rights-of-way, or easements of the City as reasonably appropriate for Contractor to provide the services herein.

4.5 Annexation
Contractor shall automatically extend all services herein described to any area annexed to the City, except that the City may permit a firm franchised by the County of San Luis Obispo before the annexation to continue service the area for a period not less than five (5) years.

4.6 City Right to Request Changes

4.6.1 General
City may request Contractor to perform additional services (including new diversion programs, billing services, etc.) or modify the manner in which it performs existing services. Pilot programs and innovative services which may entail new Collection methods, different kinds of services and/or new requirements for Waste Generators are included among the kinds of changes which City may request. Contractor shall present, within 30 days of a request to do so by City, a proposal to provide additional or expanded diversion services pursuant to the terms of Section 4.6.2. Contractor shall be entitled to an adjustment in its compensation in accordance with Section 8.5 (Extraordinary Adjustments), for providing such additional or modified services.

4.6.2 New Diversion Programs
Contractor shall present, within thirty (30) days of a request to do so by City, a proposal to provide additional or expanded diversion services. The proposal shall contain a complete description of the following:
• Collection methodology to be employed (equipment, manpower, etc.) • Equipment to be utilized (vehicle number, types, capacity, age, etc.). • Labor requirements (number of employees by classification). • Type of Containers to be utilized.
• Provision for program publicity/education/marketing.
• A projection of the financial results of the program's operations for the remaining Term of the Agreement in a balance sheet and operating statement format including documentation of the key assumptions underlying the projections and the support for those assumptions.
• Materials processing facility to be utilized.

4.6.3 City's Right to Acquire Services
Contractor acknowledges and agrees that City may permit other Persons besides Contractor to provide additional Food and/ or Green Waste services not otherwise contemplated under Section 4.6 (City's Right to Request Changes). If pursuant to Section 4.6.2 (New Diversion Programs), Contractor and City cannot agree on terms and conditions of such services in ninety (90) days from the date when City first requests a proposal from Contractor to perform such 11

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Food and Green Waste Services Agreement
services, Contractor acknowledges and agrees that City may permit Persons other than Contractor to provide such services.

4.6.4 Implementing New Services
If l) Contractor is capable of performing or developing the ability to perform a requested service or modifying an existing service; 2) City has agreed to have Contractor provide such additional service in accordance with Contractor's proposal; and 3) an adjustment in Contractor's compensation has been requested but has not been agreed upon or implemented within ninety (90) days, City may permit a third party to perform the request or modified existing service, and Contractor shall not be obligated, to perform such additional or modified service pursuant to the terms of Section 4.6.3.

4.7 Ownership of Food and Green Waste
Once Food and Green Waste is placed in Containers and properly presented for Collection, ownership and the right to possession shall transfer directly from the Generator to Contractor by operation of this Agreement. Contractor is hereby granted the right to retain, recycle, process, reuse, compost and otherwise use such Food and Green Waste or any part thereof, in any lawful fashion or for any lawful purpose consistent with the hierarchy and goals of AB 939 and AB 1826. Subject to the provisions of this Agreement, Contractor shall have the right to retain any benefit resulting from its right to retain, recycle, process, compost or reuse the Food and Green Waste which it Collects. Food and Green Waste or any part thereof, which are delivered to a Facility (Facility, transformation Facility, transfer station, or Material Recovery Facility) shall become the property of the owner or operator of the Facility(ies) once deposited there by Contractor.
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Food and Green Waste Services Agreement
ARTICLE 5

DIRECT SERVICES

5.1 General
The work to be done by Contractor pursuant to this Agreement shall include the furnishing of all labor, supervision, equipment, materials, supplies, and all other items necessary to perform the services required to collect Food and Green Waste The enumeration of, and specification of requirements for, particular items of labor or equipment shall not relieve Contractor of the duty to furnish all others, as may be required, whether enumerated or not.

The work to be done by Contractor pursuant to this Agreement shall be accomplished in a thorough and professional manner so that the customers within the City are provided reliable, courteous and high-quality Food and Green Waste Collection service at all times. The enumeration of, and specification of requirements for, particular aspects of service quality shall not relieve Contractor of the duty of accomplishing all other aspects in the manner provided in this Section, whether such aspects are enumerated elsewhere in the Agreement or not.

5.2 Food and Green Waste Services
Contractor shall Collect and remove all Food and Green Waste placed in Containers at the designated Collection locations for Commercial, Single Family Dwelling Units and Multifamily Dwelling Units.

Food and Green Waste Collection shall be a minimum of once each week on the same day of the week as Solid Waste Collection service. Contractor will notify customers of holiday Collection schedules. Should the collection day change, Contractor shall re-route Collections within sixty (60) days of the notification by the change in Solid Waste collection days to provide same day service.

5.3 Materials To Be Collected
Green waste material to be collected include tree trimmings, grass cuttings, dead plants, leaves, branches and dead trees (not more than six (6) inches in diameter) and similar materials generated at the Premises.

Food Waste materials to be collected include waste material of plant or animal origin that results from the preparation or processing of food for animal or human consumption and that is separated from the municipal solid waste stream. Food waste includes, but is not limited to, food waste from food facilities such as restaurants, food processing establishments, grocery stores, institutional cafeterias (such as schools and hospitals), and residential food scrap collection.

5.4 Refusal to Provide Collection Services
Contractor may refuse to Food and Collect Green Waste and shall not be obligated to continue to provide Green Waste Container(s) to any participant in the Food and Green Waste program 13

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who, after reasonable warning, fails to properly sort and set out Food and Green Waste.

Contractor shall report monthly to City any warning notices issued.

5.5 Christmas Tree Collection Program
Contractor shall operate an annual Christmas Tree Collection and diversion program. The program shall include curbside and drop-off Collection of Christmas Trees targeting all Single Family and Multi-family Dwelling Units and shall divert these Christmas Trees from landfill disposal.

5.6 End Uses for Food and Green Waste
Contractor shall develop and implement plans and programs to divert from disposal materials collected through curbside Collection of Food, Green Waste and Christmas Tree Collection.

Contractor must provide end uses for Food and Green Waste that maximizes diversion credits for the City according to regulations established by the CalRecycle.

5.7 Operations

5.7.1 Schedules
To preserve peace and quiet, no Food or Green Waste shall be Collected from or within twohundrcd (200) feet ofresidential Premises between 6:30 P.M. and 6:30 A.M. on any day and such Green Waste shall be Collected, Monday through Friday on the same day as Solid Waste collection. When the regularly scheduled Collection day falls on a holiday, Collection shall take place on the following regularly scheduled collection day. In the event the Contractor misses the collection of set out Food or Green Waste, the Contractor shall collect the missed pickups with one (1) business day of notification.

5.7.2 Vehicles
A. General. Contractor shall provide a fleet of Collection vehicles sufficient in number and capacity to perform the work required by this Agreement and in strict accordance with its terms. Contractor shall have available on Collection days sufficient back-up vehicles in order to respond to complaints and emergencies. The fleet shall be maintained according to the requirements of Municipal Code 8.04.030.

B. Specifications. All vehicles used by Contractor in providing Food and Green Waste Collection services under this Agreement shall comply with all federal, state, and local requirements for such vehicles as they now exist or may be amended in the future, and be registered with the California Department of Motor Vehicles. All such vehicles shall have water-tight bodies designed to prevent leakage, spillage or overflow. All such vehicles shall comply with U.S. Environmental Protection Agency noise emission regulations and other applicable noise control regulations.

C. Condition
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1) Contractor shall maintain all of its properties, facilities, and equipment used in providing service under this Agreement in a safe, neat, clean and operable condition at all times.
2) Contractor shall inspect each vehicle daily to ensure that all equipment is operating properly. Vehicles which are not operating properly and represent a safety hazard shall be taken out of service until they are repaired and do operate properly and safely.

Contractor shall perform all scheduled maintenance functions in accordance with the manufacturer's specifications and schedule. Contractor shall keep accurate records of al 1 vehicle maintenance, recorded according to date and mileage and shall make such records available to City upon request.
3) Contractor shall repair, or arrange for the repair of, all of its vehicles and equipment for which repairs are needed because of accident, breakdown or any other cause so as to maintain all equipment in a safe and operable condition. Contractor shall maintain accurate records of repair, which shall include the date/mileage, nature of repair and the signature of a maintenance supervisor that the repair has been properly performed. 4) Contractor shall arrange all vehicles and other equipment in safe and secure location(s) in accordance with all applicable zoning regulations.

D. Vehicle Identification. Each truck shall display in a prominent place a sign as required in Municipal Code section 8.04.090.

E. Operation. Vehicles shall be operated in compliance with the California Vehicle Code, and all applicable safety and local ordinances. Contractor shall not load vehicles in excess of the manufacturer's recommendations or limitations imposed by state or local weight restrictions on vehicles.

5.7.3 Food and Green Waste Containers
Contractor shall supply each Single Family Dwelling Unit with a waste wheeler in size consistent with the City approved Food and Green Waste Collection program. In addition, Contractor will supply each Single Family customer a container to collect Food Waste inside a dwelling as approved by the City. Contractor shall supply each multi-family complex and commercial customer with the appropriate type of container to adequately service the needs. Containers shall be identified for Food and/or Green Waste only. Contractor agrees to provide additional appropriate Containers, as required.

City and Contractor acknowledge that from time to time, a customer may damage or destroy a Container. City and Contractor also acknowledge that from time to time Containers may be stolen from the curb or damaged due to normal use. When notified of such occurrence, Contractor shall replace the Container, at no charge to the customer. 15

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5.7.4 Litter Abatement
Contractor shall use due care to prevent Food or Green Waste from being spilled or scattered during the Collection or transportation process. If any Food or Green Waste is spilled during Collection, Contractor shall promptly clean up all spilled materials. Each collection vehicle shall carry a broom and shovel at all times for this purpose.

5. 7 .5 Personnel
A. General. Contractor shall furnish qualified drivers, mechanical, supervisory, clerical, and other personnel as may be necessary to provide services required by this Agreement in a safe and efficient manner.

B. Identification. Contractor shall ensure that while on duty each Collection worker wears a clean uniform which displays the Contractor's company name and the worker's name or identification number.

C. Fees & Gratuities. Company shall not, nor shall it permit any agent, employee, or subcontractors employed by it to request, solicit, demand, or accept, either directly or indirectly any compensation or gratuity for any services performed under this Agreement except as provided in Article 8 of this Agreement.

D. Training. All drivers shall be trained and qualified in the operation of vehicles they operate and must possess a valid license, of the appropriate class, issued by the California Department of Motor Vehicles.

Contractor shall provide adequate operations, health and safety training, and Hazardous Waste identification and handling training for all of its employees who use or operate equipment or who are otherwise directly involved in Collection or other related operations.

E. Customer Courtesy. Contractor shall train its employees in customer courtesy, shall prohibit the use of loud or profane language, and shall instruct Collection crews to perform the work quietly. Contractor shall use its best efforts to ensure that all employees present a neat appearance and conduct themselves in a courteous manner. If any employee is found to be discourteous or not to be performing services in the manner required by this Agreement, Contractor shall take all necessary corrective measures. If City has notified Contractor of a complaint related to a discourteous or improper behavior, Contractor will reassign the employee to duties not entailing contact with the public while Contractor is pursuing its investigation and corrective action process.

5.8 Implementation Plan
The parties recognize that substantial planning will be required in order to assure an orderly initiation of Food and Green Waste Collection services on January 1, 2016. To that end, the 16

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City will require Contractor to submit by November 1, 2015 a detailed implementation plan addressing, among other things, the steps Contractor will take and the schedule on which it will take them, to prepare for such an orderly initiation of service. The implementation plan shall cover Contractor's schedule for acquiring necessary equipment, personnel, storage and maintenance facilities, administrative offices, customer relations materials (including Collection schedules, route maps, billing forms, complaint forms, service request forms, etc.).

Contractor agrees to adhere strictly to the implementation plan. The implementation shall be subject to the City's review and approval.

Failure to substantially adhere to the implementation schedule will constitute a breach of this Agreement, and, if incurred, an event of default, under Article 12, Default, Remedies, and Liquidated Damages.

5.9 Food and Green Waste Processing

5.9.1 Receipt of Food and Green Waste
Commencing January 1, 2016, the Contractor shall have in place or have made arrangements for a Facility to receive and accept all deliveries of Food and Green Waste generated in the city.

Contractor has designated the Engle and Gray facility to be utilized as of the Effective Date until the HZI Kompogas facility (or other similar technology) located at the Contractor's site (4388 Old Santa Fe Rd, San Luis Obispo) is constructed and operational. Contractor has designated Hitachi Zosen Inova (HZI) facility as the permanent processing site. If the HZI Kompogas facility is not constructed, Contractor will continue to utilize the Engle and Gray facility for Food and Green Waste Processing.

5.9.2 Status of Food and Green Waste Facility
Any Facility used by contractor must be designed and constructed in accordance with all applicable state and local laws (e.g., CEQA, California Code of Regulations, etc). The Facility must have all permits from federal, state, regional, county and city agencies necessary for it to operate as a Food and/ or Green Waste Facility and must be in full regulatory compliance with all such permits.

The selected Food and Green Waste Facility must be authorized to accept, under its existing permit, and have sufficient uncommitted capacity to accept, all Food and/ or Green Waste delivered to it by, or on behalf of, the City for the term of this Agreement. Contractor shall immediately notify City of any notice of breach or default received from Food and Green Waste Facility.

5.9.3 Alternative Processing Facility
If Contractor becomes unable to deliver the City's Food and Green Waste to the Food and Green Waste Facility due to causes within its control or which could have been avoided by the exercise of due care, the Contractor shall arrange for it to be accepted at another Food and Green Waste Facility, in which case Contractor shall pay for any increased transportation costs, any differences in the fees charged at such Food and Green Waste Facility and the fees then in effect under this Agreement. If Contractor's inability to deliver the City's Food and Green 17

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Waste to the Food and Green Waste Facility is not due to causes within its control or which could have been avoided by the exercise of due care, then Contractor shall propose alternative Food and Green Waste Facilities including all related costs and City shall select the alternative to be used.

5.9.4 Disposition of Unauthorized Waste
Contractor shall ensure that procedures to identify and reject materials delivered to the Food and Green Waste Facility which are Hazardous Waste, or which otherwise may not be legally accepted at the Food and Greer:i Waste Facility under their permits, are in place. Contractor may, in the course of implementing such procedures, refuse to accept Food and Green Waste deposited from the City if they constitute Hazardous Waste, or otherwise may not be legally accepted at the Food and Green Waste Facility, and Contractor shall be solely responsible of the materials which are accepted. If Contractor discovers Hazardous Waste, or other material which may not be legally accepted, among materials which it has accepted, it shall dispose of such waste at its own expense. Contractor may pursue all legal rights and remedies it may have against the Waste Generator( s) of such Solid Waste, if the Waste Generator( s) can be identified.

5.10 Dise>osal
Contractor shall ensure that the residual Solid Waste from the City's Food and Green Waste delivered to the Food and Green Waste Facility by the Contractor are disposed of at a permitted disposal site in full regulatory compliance.
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6.1 Billing
Food and Green Waste Services Agreement
ARTICLE6

OTHER SERVICES
The City Council shall establish an integrated rate for the Food and Green Waste, Recycling and Solid Waste services. Contractor shall bill and collect for its services at no more nor less than these rates. Contractor's billing plan, including billing frequency, and format shall be suhjcct to approval hy City, and City shall have the right to revise the billing format to itemize certain charges.

The City may also direct Contractor to insert mailers relating to contractor provided services with the billings and shall be responsible for all labor costs with respect to the mailing inserts.

The owner of occupied Premises shall be responsible and liable for paying the Food and Green Waste fees for that property.

6.2 Collection of Bills from Delinquent Customers
Once each year, prior to a date established by the City, Contractor may take actions pursuant to Chapter 8.04 of the Municipal Code to collect delinquent accounts.

6.4 Customer Service

6.4.1 Office
Office hours shall be, at a minimum, from 8:00 A.M. to 5:00 P.M., Monday through Friday, exclusive of holidays. A responsible and qualified representative of Contractor shall be available during office hours for communication with the public. Telephone numbers shall either be a local or a toll free call to residents and businesses of the City. Contractor's telephone system shall be adequate to handle the volume of calls typically experienced on the busiest days. Contractor shall also maintain a local or toll free telephone number for use during 19

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other than normal business hours. Contractor shall have a representative, answering or message providing/receiving (voice-mail) service available at said after hours telephone number.

6.4.2 Complaint Documentation
All service complaints related to Food and Green Waste Collection shall be directed to Contractor. Daily logs of complaints concerning Collection of Food and Green Waste shall be retained for a minimum of twenty-four (24) months and shall be available to City at all times during this Agreement upon twenty-four (24) hour notice.

All customer service records and logs kept by Contractor shall be available at all times during this Agreement to City upon twenty four (24) hour notice and at no cost to City. City shall, at any time during regular Contractor business hours, have access to Contractor's customer service department for purposes of monitoring the quality of customer service or researching customer complaints assessing liquidated damages or other matters related to Contractor's performance under this Agreement.

6.4.3 Resolution of Customer Complaints
Contractor shall notify customers of this complaint procedure at the time customers apply for or are provided service, and subsequently, annually.

6.4.4 Government Liaison
Contractor shall designate in writing a "Goverrunent Liaison" who shall be responsible for working with the City M1mager, Utilities Director and/or one of their designated representative(s) to resolve customer complaints.

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Contractor agrees to cooperate with City in exploring opportunities to expand public and customer knowledge concerning needs and methods to reduce, reuse and recycle Solid Waste and to cooperate fully with City in this regard.

Contractor shall perform all necessary public education activities related to the Food and Green Waste services as directed by the City. This shall include, but not be limited to, annual mailings to all customers explaining the Food and Green waste program, mailings prior to the start of services, flyers handed out with Container delivery and follow-up mailings or handouts related to the collection of new materials. All public education materials shall be approved in advance by the City.

At the direction of the City Manager and/or Utilities Director, Contractor shall participate in and promote Recycling, reuse and other diversion techniques at community events and local activities. Such participation would normally include providing, without cost to the City, educational and publicity information promoting the goals of the City's AB 939 and AB 1826 programs.
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7.1 Franchise Fee
Food and Green Waste Services Agreement
ARTICLE 7

PAYMENTS TO CITY
In consideration of the exclusive franchise provided for in this Agreement, Contractor shall pay the City ten percent (10%) of its gross revenues for Food and Green Waste Collection services; provided, however, that such franchise fee shall not exceed the costs incun-ed by the City to deliver service to properties. Such franchise fee shall be a "pass-through" expense for purposes of rate review.

7.2 AB 939 Fee
If requested by City, Contractor shall pay an AB 939 fee, to be specified annually by the City.

All AB 939 fees paid to the City shall be considered a pass through cost for purposes of rate setting.
7 .3 Business License Tax
Contractor shall pay each annual business license tax.

7.5 Time and Method of Payment
If Contractor is directed to pay an AB 939, Franchise Fee or "Other" Fee, it shall do so on or before the fifteenth (15th) day of each month during the Term. Contractor shall remit to City a sum of money equal to the designated percentage of the gross revenue or a flat monthly fee as determined by the City. If any fees are not paid on or before the fifteenth (15th) day of any month, Contractor shall pay to City a late payment penalty in an amount equal to one percent (1 % ) of the amount owing for that month. Contractor shall pay an additional late payment penalty of one percent (1 %) owing on any unpaid balance for each following thirty (30) day period the fee remains unpaid. Late payment penalty amounts shall not be included in any revenue requirement.

7.6 Ad justment of Fees
The City may adjust the amount of fees annually. Such adjustment shall be reflected in the rates that the Contractor is allowed to charge and collect from customers.

7. 7 Review of Fee Payments
The City, or its agent, reserves the right to annually perform an independent review of fee payments, to verify that fees are being paid in accordance with Agreement. The cost of such reviews will be an allowable cost under the rate setting methodology. 22

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Food and Green Waste Services Agreement

ARTICLES

CONTRACTOR'S COMPENSATION AND RATES

The Contractor does not look to the City for payment of any sums under this Agreement.

Contractor will perform the responsibilities and duties described in this Agreement in consideration of the right to charge and collect from customers for services rendered at rates fixed by the City from time-to-time and the right to sell compost and other beneficial byproducts generated from the Food and Green Waste. The City shall have the right to structure those rates as it deems appropriate so long as the revenues forecasted to be received by Contractor from charging such rates can reasonably be expected to generate sufficient revenues to provide for Contractor's compensation.

8.3 Subsequent Rates
Contractor may request rate revisions in future solid waste rate applications. The rate application must comply with the City's "Rate Setting Process and Methodology Manual for Solid Waste Management Rates".

8.5 Extraordinary Adjustments
Contractor or City may request an adjustment to rates at times other than that required in Section 8.3 for unusual changes in the cost of providing service under this Agreement. Such changes may include, but are not limited to, changes in laws, ordinances, or regulations, and significant changes in Contractor's workload due to new residential or commercial development. However, when an extraordinary adjustment is requested, such adjustment shall consider changes in all costs and revenues from Contractor's proposed revenue requirement. 23

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For each such request, Contractor shall prepare a schedule comparing the original proposed costs and revenues by line item to the then current costs and revenues, including an estimates of the cost impact of the change, using an operating ratio of 93%, applied to Contractor's costs as calculated in Contractor's proposed revenue requirement. Such request shall be prepared in a form acceptable to City with support for assumptions made by Contractor in preparing the estimate. Contractor and City shall negotiate a mutually acceptable adjustment amount. 24

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ARTICLE9

RECORDS, REPORTS AND INFORMATION, STUDIES

AND HEARING REQUIREMENTS

9.1 Records

9.1.1 General
Contractor shall maintain records required to conduct its operations, to support requests it may make to City, and to respond to requests from City in the conduct of City business.

9.1.3 General Records
City approved records (format) shall be maintained for the City separate from other jurisdictions relating to:
• Customer services;
• Weight of Food and Green Waste;
• Routes;
• Facilities, inventory of equipment and personnel used; • Facilities and equipment operations, maintenance and repair; • Processing of Food and Green Waste and marketing and sale of Compost including name of the purchaser, the date of sales transaction, processing cost per ton, quantity purchased, value per ton and net sales records;
• Complaints; and,
• Missed pick ups.

Contractor shall maintain records of all Food and Green Waste Collected in the City for the term of this Agreement. In the eve.nt Contractor discontinues providing Food and Green Waste services to City, Contractor shall provide all records of all Food and Green Waste Collected in City to City within thirty (30) days of discontinuing service. Records shall be in chronological and organized form and readily and easily interpreted.

9.2 Reports

9.2.1 Report Formats and Schedule
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Records shall be maintained in forms and by methods that facilitate flexible use of data contained in them to structure reports, as needed. Contractor may propose report formats that are responsive to the objectives and audiences for each report. The format of each report shall be approved by the City.

Monthly reports shall be submitted within twenty (20) calendar days after the end of the month being reported. Annual reports shall be submitted before September 30th, for the previous reporting year. ·

9.2.2 Monthly Reports
The information listed shall be the minimum reported:
• Food and Green Waste collected, sorted by type of Generator, in tons, by month, and cumulative for report year.
• Complaint summary, for month and cumulative for report year. • Narrative summary assessment of problems encountered and actions taken with recommendations to City for improvement.
• Number of accounts by category for each month of reporting year. • Participation rates.
• Food and Green Waste Container distribution.

The City may designate any additional information that it wishes provided in the monthly reports.

Financial statements shall include a supplemental schedule combining Contractor's results of operations, separating the specific revenues and expenses, including detailed information with respect to general overhead claimed by the Contractor, in connection with the operations provided for in this Agreement from others included in such financial statements. The financial statements, supplemental schedule, management letter and footnotes shall be prepared in accordance with Generally Accepted Accounting Principles (GAAP) and audited, in accordance with UeneralJy Accepted Auditing Standards (GAAS) by a certified public accountant (CPA) licensed (in good standing) to practice public accounting in the State of California as determined by the State of California Department of Consumer Affairs Board of Accountancy. The CPA opinion on Contractor's annual financial statements and supplemental schedule shall be unqualified, except as to uncertainties for which the ultimate outcome cannot be determined by the date of the CPA's opinion.
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9.3 Right to Inspect Records
City shall have the right to inspect or review the payroll tax reports, specific documents or records required expressly or by inference pursuant to this Agreement, or any other similar records or reports of Contractor that City shall deem, in its sole discretion, necessary to evaluate annual reports, compensation applications provided for in this Agreement and Contractor's performance provided for in this Agreement. The City retains the right to have an independent third party or agent of the City's choosing, such as a CPA, participate in the records inspection. The cost of such inspection or review will be an allowable cost under the rate setting methodology.

9.3.1 Right to Review Basis for Landfill Tipping Fee Increases The Contractor shall provide to the City a copy of Cold Canyon Landfill's and/or the designated Food and Green Waste processing facility's request for an increase in tipping fees no later than five (5) days following submittal of said request to the County of San Luis Obispo and/or the designated processing faci lity.

Additionally, the Contractor shall notify the City of the action taken by the Board of Supervisors and /or the designated processing facility regarding said request within five (5) days following said action, including letter to the Board of Supervisors and related executed resolution and/or appropriate documentation from the designated processing facility. The City retains the right to have an independent third party or agent of the City's choosing, such as a CPA, participate in the review. The cost of such inspection or review will be an allowable cost under the rate setting methodology unless there are findings pursuant to Section 12.5.

9.5 Performance Hearing
The City maintains the right to hold a public hearing at any time, not more than once each year, at which the Contractor shall be present and shall participate, to review its services and performance. The purpose of the hearing is to provide for a discussion and review of technological, economic, and regulatory changes in order to achieve a continuing, advanced Solid Waste management system; and to ensure customer service quality and any other areas that may be addressed regarding services are being provided with adequate quality, efficiency and economy.

Sixty (60) days after receiving notice from City of a Performance Hearing, Contractor shall, at a minimum, submit a report to City indicating ( l) changes recommended and/or new services to improve City's ability to meet the goals of AB 939 and Ab 1826 to contain costs and 27

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minimize impacts on rates; and (2) any specific plans for provision of changed or new services by Contractor.
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10.1 Indemnification
Food and Green Waste Services Agreement
ARTICLE 10

INDEMNIFICATION, INSURANCE AND BOND
Contractor shall indemnify and hold harmless City, its officers, Directors, employees, and agents from and against any and all loss, liability, penalty, forfeiture, claim, demand, action proceeding or suit of any and every kind and description (including, but not limited to, injury to and death of any Person and damage to property, or for contribution or indemnity claimed hy third parties) to the extent arising or resulting from and in any way connected with (1) the negligence or willful misconduct of Contractor, its officers, employees agents and/or sub Contractors in performing services under this Agreement; (2) the failure of Contractor, its officers, employees, agents and/or subcontractors to comply in all respects with the provisions of this Agreement, applicable laws (including, without limitation, the Environmental Laws) and regulations, and/or applicable permits and licenses; (3) the acts of Contractor, its officers, employees, agents and/or subcontractors in performing services under this Agreement for which strict liability is imposed by law (including, without limitation, the Environmental Laws). Contractor further agrees to and shall, upon demand of City, at Contractor's sole cost and expense, defend (with attorneys acceptable to City) the City, its officers, directors, employees, and agents against any claims, actions, suits or other proceedings, whether judicial, quasi-judicial or administrative in nature, arising or resulting from any events described in the immediately preceding paragraph to the extent arising from or related to alleged or actual violations of Proposition 218 and/or its implementing legislation,.

Contractor's duty to indemnify and defend shall survive the expiration or earlier termination of this Agreement.

10.2 Landfill Diversion
The Contractor acknowledges that the City has adopted a SRRE which selects Food and Green Waste Collection and Composting programs as a means of diverting an estimated 6,796 tons in 1995 and 8,248 tons per year by the year 2000. It is therefore of foremost importance that the Food and Green Waste and wood debris collected under this Agreement be converted into a functional and marketable product in order that the materials may be diverted from landfill disposal in compliance with the City's SRRE, and AB 939. The Contractor shall therefore use commercially reasonable efforts ensure that the processing method used shall, at all times, meet the intent of the City's SRRE and AB 939. Should the Contractor find it necessary to utilize another method of processing in order to meet the intent of the SRRE and AB 939, the City shall be given an opportunity lo make its own determination as to the suitability and costeffectiveness of such process and shall approve such process in writing. The City shall have the right to terminate this Agreement upon the giving of a six (6) month prior written notice to Contractor should it be determined that the Food and Green Waste program being implemented and/or proposed under this Agreement is ineffective in meeting the City's diversion goals and objectives. Upon termination, the Contractor shall be entitled only to revenues less expenses incurred to that date. All revenues received thereafter shall be the property of the City unless otherwise agreed.
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10.3 AB 939 Indemnification
Contractor agrees to indemnify and hold harmless City, its officers, Directors, employees, and agents from and against all fines and/or penalties imposed by the California Integrated Waste Management Board in the event the source reduction and recycling goals or any other requirement of AB 939 are not met by City with respect to the waste stream Collected under this Agreement but only to the extent such failure is due to the failure of Contractor to meet its obligations· under this Agreement or for delays in providing information that prevents City from submitting reports required by AB 939 in a timely manner.

10.4 Insurance
A. Minimum Limits of Insurance. Contractor shall maintain limits no less than:

1. Comprehensive General Liability: One Million Dollars ($1,000,000) combined single limit per occurrence for bodily injury, Personal injury and property damage.

2. Automobile Liability: One Million Dollars ($1,000,000) combined single limit per accident for bodily injury and property damage.

3. Workers' Compensation and Employers Liability: Workers' compensation limits as required by the Labor Code of the State of California and Employers Liability limits of $1,000,000 per accident.

C. Other Insurance Provisions. The policies are to contain, or be endorsed to contain, the following provisions:

1. General Liability and Automobile Liability Coverages a) The City, its officials, employees, and directors are to be covered as insured as respects: liability arising out of activities performed by or on behalf of Contractor; products and completed operations of Contractor; Premises owned, leased or used by Contractor; or automobiles owned, leased, hired or borrowed by Contractor. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officials, employees or volunteers.
b) Contractor's insurance coverage shall be primary insurance as respects City, its officials, directors, employees and volunteers. Any insurance or self-insurance maintained by City, its officials, or employees shall be excess of Contractor's insurance and shall not contribute with it.
c) Any failure to comply with reporting provisions of the policies shall not affect coverage provided to City, its officials, or employees. 30

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d) Coverage shall state that Contractor's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability.

2. Workers' Compensation and Employers Liability Coverage - The insurer shall agree to waive all rights of subrogation against City, its officials, and employees for losses arising from work performed by Contractor for City.

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ARTICLE 11

CITY'S RIGHT TO PERFORM SERVICE

11.1 General
In the event that Contractor, for any reason whatsoever, fails, refuses or is unable to Collect, transport or process any or all Food and Green Waste materials which it is required by this Agreement to Collect and process, at the time and in the manner provided in this Agreement, for a period of more than seven (7) calendar days, and if, as a result thereof, Food and Green Waste should accumulate in the City to such an extent, in such a manner, or for such a time that the City Manager should find that such accumulation endangers or menaces the public health, safety or welfare, then City shall have the right, but not the obligation, upon twenty-four (24) hour prior written notice to Contractor during the period of such emergency as determined by the City Manager, ( 1) to perform, or cause to be performed, such services itself with its own or other personnel without liability to Contractor; and/or (2) to take possession of any or all of Contractor's land, equipment and other property to Collect, transport or process any Food and/or Green Waste generated within the City which Contractor would otherwise be obligated to Collect, transport, process or market pursuant to this Agreement. In the event the City takes possession of the Contractor's equipment and other property, the City shall be entitled to have another contractor operate such equipment and property under City direction. Additionally, in the event the City takes possession of the Contractor's equipment and other property, the City does not guarantee repair of existing problems with equipment and facilities.

Notice of Contractor's failure, refusal or neglect to Collect, transport or process Food and Green Waste may be given orally by telephone to Contractor at its principal office and shall be effective immediately. Written confirmation of such oral notification shall be sent to Contractor within twenty-four (24) hours of the oral notification.

Contractor further agrees that in such event:
• It will take direction from City to effect the transfer of possession of property to City for City's use.
• It will, if City so requests, keep in good repair and condition all of such property, provide all motor vehicles with fuel, oil and other service, and provide such other service as may be necessary to maintain said property in operational condition. • City may immediately engage all or any personnel necessary or useful for the Collection, transportation and processing Green Waste, including, if City so desires, employees previously or then employed by Contractor, Contractor further agrees, if City so requests, to furnish City the services of any or all management or office personnel employed by Contractor whose services are necessary or useful for Green Waste Collection, Transportation and processing operations and for the billing and collection of fees for these services.
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City agrees that it assumes complete responsibility for the proper and normal use of such equipment and facilities while in its possession.

If the interruption or discontinuance in service is caused by any of the reasons listed in Section

Except as otherwise expressly provided in the previous paragraph, City's exercise of its rights under this Article I 1 (I) does not constitute a taking of private property for which compensation must be paid; (2) will not create any liability on the part of City to Contractor; and (3) does not exempt Contractor from the indemnity provisions of Article 10, Indemnification, Insurance and Bond, which are meant to extend to circumstances arising under this Section, provided that Contractor is not required to indemnify City against claims and damages arising from the sole negligence of City officers, employees and agents in the operation of Collection vehicles during the time City has taken possession of such vehicles.

11.2 Temporary Possession of Contractor's Property
If the City suffers an interruption or discontinuance of service as described in Section 11. l (including interruptions and discontinuance due to events described in Section 12.4, Excuse from Performance), City may take possession of and use all of Contractor's property described above until other suitable arrangements can be made for the provision of Food and Green Waste Services which may include the grant of a Contract to another company. The same notice requirements of Section 11.1 are applicable.

11.3 Billing and Compensation to City During City's Possession During such time that city is providing Green Waste services, as above provided, Contractor shall continue to bill and collect payment from all users of the above-mentioned services.

Contractor further agrees that, in such event, it shall reimburse City for any and all costs and expenses incurred by City in taking over possession of the above-mentioned property for Food and Green Waste service in such manner and to an extent as would otherwise be required of Contractor under the Terms of this Agreement. Such reimbursement shall be made from time to time after submission By City to Contractor of each statement listing such costs and expenses, but in no event later than five (5) working days from and after each such submission.

The City shall have the right, at its sole discretion, to take over billing and payment collection activities. The City shall then pay any net revenues to the Contractor, after deducting all expenses, including City-incurred expenses.

11.4 City's Right to Relinquish Possession
It is further mutually agreed that City may at any time at its discretion relinquish possession of any or all of the above-mentioned property to Contractor and thereupon demand that Contractor resume the Food and Green Waste services as provided in this Agreement, whereupon Contractor shall be bound to resume the same.
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11.5 Duration of City's Possession
City's right pursuant to this Article to retain temporary possession of Contractor's faci lities and equipment, and to render Collection services, shall terminate when City determines that such services can be resumed by Contractor, or when City no longer reasonably requires such facilities or equipment. In any case, City has no obligation to maintain possession of Contractor's property and/or continue its use for any period of time and may at any time, in its sole discretion, relinquish possession to Contractor.
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ARTICLE 12

DEFAULT, REMEDIES AND LIQUIDATED DAMAGES

12.1 Events of Default
All provisions of this Agreement to be performed by Contractor are considered material. Each of the following shall constitute an event of default.

A. Fraud or Deceit. If Contractor practices, or attempts to practice, any fraud or deceit upon city.

E. Failure to Perform. If Contractor ceases to provide Food and Green Waste services as required under this Agreement for a period of two (2) days or more, for any reason within the control of Contractor.

G. Acts or Omissions. Any other act or omission by Contractor which violates the terms, conditions, or requirements of this Agreement, the California Integrated Waste Management Act of 1989, as it may be amended from time to time, or any order, directive, rule, or regulation issued there under and which is not corrected or remedied within the time set in the written notice the violation or, if Contractor cannot reasonably correct or remedy the breach within the time set forth in such notice, if Contractor should fail to commence to correct or remedy such violation within the time set forth in such notice and diligently effect such correction or remedy thereafter. 35

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H. False or M isleading Statements. Any representation or disclosure made to City by Contractor in connection with or as an inducement to entering into this Agreement, or any future amendment to this Agreement, which proves to be false or misleading in any material respect as of the time such representation or disclosure is made, whether or not any such representation or disclosure appears as part of this Agreement.

I. Attachment. There is a seizure of attachment ot: or levy on, the operating equipment of Contractor, including without limits its equipment, maintenance or office facilities, or any part thereof.

Upon default by the Contractor, the City Manager shall provide written notice to Contractor of the violation. The City Manager shall include in the notice, a demand that the Contractor correct the violation within 10 days following the delivery of said notice. If the violation is not corrected within the 10 days, the City shall have the right to terminate the Agreement per the provisions provided in Section 12.2. For purposes of this Agreement and any notice required thereunder, the term "days" shall mean calendar days.

City's right to terminate this Agreement and to take possession of Contractor's equipment and facililies are not exclusiv~, aml City's termination of this Agreement shall not constitute an election of remedies. Instead, they shall be in addition to any and all other legal and equitable rights and remedies which City may have.

12.3 Liquidated Damages
A. Gener al. City finds, and Contractor agrees, that as of the time of the execution of this Agreement, it is impractical, if not impossible, to reasonably ascertain the extent of 36

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damages which shall be incurred by City as a result of a breach by Contractor of its obligations under this Agreement.

B. Service Performance Standards; Liquidated Damages for Failure to Meet Standards. The parties acknowledge that consistent, reliable Green Waste service is of utmost importance to City and that city has considered and relied on Contractor's representations as to its quality of service commitment in awarding the Agreement to it.

The parties further recognize that some quantified standards of performance are necessary and appropriate to ensure consistent and reliable service and performance.

The parties further recognize that if Contractor fails to achieve the performance standards defined in this Section, comply with complaint resolution criteria, or fails to submit required documents in a timely manner, City and its residents will suffer damages and that it is and will be impractical and extremely difficult to ascertain and determine the exact amount of damages which City will suffer. Therefore, without prejudice to City's right to treat such non-performance as an event of default under this Article 12, the parties agree that the following liquidated damage amounts represent a reasonable estimate of the amount of such damages considering all of the circumstances existing on the date of this Agreement, including the relationship of the sums to the range of harm to City that reasonably could be anticipated and the anticipation that proof of actual damages would be costly or inconvenient. Recognizing the importance of resolving any failure to meet the service performance standard, the City shall contact Contractor within two (2) days of any failing reported directly to the City.

Contractor agrees to pay (as liquidated damages and not as a penalty) the amounts set forth below:

Collection Reliability and Quality
• For each failure over five (5) annually to commence service to a new customer account within seven (7) days after order: $150.00 • For each failure over ten (10) annually to Collect Food and/or Green Waste, which as been properly set out for Collection, from
an established customer account on the scheduled Collection day: $150.00 • For each failure to Collect Food and/or Green Waste which have been properly set out for Collection, from the same customer on two (2) consecutive scheduled pickup days: $150.00
• For each occurrence over five (5) annually of damage to private property: $250.00
• For each occurrence of discourteous behavior: $250.00 • For each failure over ten (10) annually to clean up
Food and/or Green waste spilled from Bins:
• For each occurrence over five (5) annually of Collecting 37 $150.00

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Food and/ or Green Waste during unauthorized hours:
• Por each failure to respond to a customer complaint within twenty-four (24) working hours:

Timeliness of Suhmjs,o;;ions to City
$250.00
$100.00
REPORTS Any report shall be considered late until such time as a correct and complete report is received by City. For each calendar day a report is late, the daily assessment shall be:

Monthly Reports:

Annual Reports:

For each infraction
For each infraction
$100 per day
$500 per day
Liquidated damages will only be assessed after Contractor has been given the opportunity but failed to rectify the damages, as described in this Agreement (e.g., twenty-four (24) working hours to respond to a complaint). City may determine the occurrence of events giving rise to liquidated damages through the observation of its own employees or representative or investigation of customer complaints.

Prior to assessing liquidated damages, City shall give Contractor notice ofits intention lo do so.

The notice will include a brief description of the incident(s)/non-performance. Contractor may review (and make copies at its own expense) all information in the possession of City relating to incident(s)/non-performance. Contractor may, within ten (10) days after receiving the notice, request a meeting with City. If a meeting is requested, it shall be held by the City Manager or his/her designee. Contractor may present evidence in writing and through testimony of its employees and others relevant to the incident(s)/non performance. The City Manager or designee will provide Contractor with a written explanation of his or her determination on each incident(s)/non-performance prior to authorizing the assessment of liquidated damages. The decision of the City Manager or designee shall be final.

C. Amount. The City Manager may assess liquidated damages for each calendar day or event, as appropriate, that Contractor is determined lo be liable in accordance with this Agreement.

D. Timing of Payment. Contractor shall pay any liquidated damages assessed by City within ten (I 0) days after they are assessed. If they are not paid within the ten (10) day period, City may proceed against the performance bond required by this Agreement or order the termination of this Agreement, or both pursuant to the terms of this Agreement.

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other similar catastrophic events which are beyond the control of and not the fault of the party claiming excuse from performance hereunder. Labor unrest, including but not limited to strike, work stoppage or slowdown, sick-out, picketing, or other concerted job action conducted by Contractor's employees or directed at Contractor or its selected facilities is not an excuse from performance and Contractor shall be obligated to continue to provide service notwithstanding the occurrence of any or all such events.

The interruption or discontinuance of Contractor's services caused by one or more of the events excused shall not constitute a default by Contractor under this Agreement. Notwithstanding the foregoing, however, if Contractor is excused from performing its obligations hereunder for any of the causes listed in this Section for a period of seven (7) days or more, City shall have the right to review the circumstances under which the excuse from performance was granted. After such review, if the City determines the excuse from service is no longer valid, the City shall notify the Contractor in writing to resume service within two (2) days from the receipt of such notification. If the Contractor fails to resume service within the two (2) days, the City shall have the right to terminate this Agreement by giving ten (10) days notice, in which case the provisions relative to taking possession of Contractor's land, equipment and other property and engaging Contractor's personnel in Article 11, City's Right to Perform Services, and this Article 12 shall apply.

12.5 Financial Material Errors, Omissions or Irregularities The City may review, test and audit the books and records of the Contractor for the purpose of determining whether the contractor is complying with the terms of the Agreement. In the event that material errors or omissions or irregularities are identified, and then the cost associated with the audit, test or review shall be paid by the Contractor to the City. In the case of financial errors, materiality shall be deemed to be two percent (2%) or greater of the gross revenues of the Contractor from activities performed under this agreement. Recovery of any overpayment will be negotiated on a case by case basis, either immediately or through the next rate setting evaluation.
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ARTICLE 13

OTHER AGREEMENTS OF THE PARTIES

Contractor shall be solely responsible for the acts and omissions of its officers, employees, subcontractors and agents. Neither Contractor nor its officers, employees, subcontractors and agents shall obtain any rights to retirement benefits, workers compensation benefits, or any other benefits which accrue to City employees by virtue of their employment with City.

13.3 Governing Law
This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of California.

13.5 Assignment
Except as may be provided for in Article 11 , (City's Right to Perform Service), neither party shall assign its rights, nor delegate, subcontract or otherwise transfer its obligations under this Agreement to any other Person without the prior written consent of the other party. Any such assignment made without the consent of the other party shall be void and the attempted assignment shall constitute a material breach of this Agreement. The Contractor shall consent to any assignment to a joint powers authority, or any similar public entity assignee of the City.

For purposes of this Section when used in reference to Contractor, "assignment" shall include, but not be limited to ( 1) a sale, exchange or other transfer of at least fifty-one percent (51 % ) all of Contractor's assets dedicated to service under this Agreement to a third party; (2) a sale, exchange or other transfer of outstanding common stock of Contractor to a third party provided 40

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said sale, exchange or transfer may result in a change of control of Contractor; (3) any dissolution, reorganization, consolidation, merger, re-capitalization, stock issuance or reissuance, voting trust, pooling agreement, escrow arrangement, liquidation or other transaction to which results in a change of ownership or control of Contractor; ( 4) any assignment by operation of law, including insolvency or bankruptcy, making assignment for the benefit of creditors, writ of attachment for an execution being levied against this Agreement, appointment of a receiver taking possession of Contractor's property, or transfer occurring in the event of a probate proceeding; and (5) any combination of the foregoing (whether or not in related or contemporaneous transactions) which has the effect of any such transfer or change of ownership, or change of control of Contractor.

Contractor acknowledges that this Agreement involves rendering a vital service to City's residents, and that City has selected Contractor to perform the services specified herein based on (1) Contractor's experience, skill and reputation for conducting its Solid Waste ·management operations in a safe, effective and responsible fashion, at all times in keeping with applicable Environmental Laws, regulations and best waste management practices, and (2) Contractor's financial resources to maintain the required equipment and to support its indemnity obligations to City under this Agreement. City has relied on each of these factors, among others, in choosing Contractor to perform the services to be rendered by Contractor under this Agreement.

If Contractor requests City's consideration of and consent to an assignment, City may deny or approve such request in its complete discretion. The City is concerned about the possibility that assignment could result in significant rate increases, as well as a change in the quality of service. Accordingly, the following standards have been set to ensure that assignment will result in continued quality service. In addition, the City reserves the right to solicit competitive bids for these services if the assignment results in a request by the assignee for rate increases that are higher than the inflationary index and do not reflect value changes in service standards.

At a minimum, no request by Contractor for consent to an assignment need be considered by City unless and until Contractor has met the following requirements:

A. Contractor shall undertake to pay City its reasonable expenses for attorney's fees and investigation costs necessary to investigate the suitability of any proposed assignee, and to review and finalize any documentation required as a condition for approving any such assignment;
B. Contractor shall furnish City with audited financial statements of the proposed assignee's operations for the immediately preceding three (3) operating years; C. Contractor shall furnish City with satisfactory proof: 1) that the proposed assignee has at least ten (10) years of Green Waste management experience on a scale equal to or exceeding the scale of operations conducted by Contractor under this Agreement; 2) that in the last five (5) years, the proposed assignee has not suffered any significant citations or other censure from any federal, state or local agency having jurisdiction 41

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over its Solid Waste management operations due to any significant failure to comply with state, federal or local Environmental Laws and that the assignee has provided City with a complete list of such citations and censures; 3) that the proposed assignee has at all times conducted its operations in an environmentally safe and conscientious fashion; 4) that the proposed assignee conducts its Green Waste management practices in accordance with sound waste management practices in full compliance with all federal, state and local laws regulating the collection, transportation, processing, marketing and disposal of Solid Waste including Hazardous Wastes; and, 5) of any other information required by City to ensure the proposed assignee can fulfill the Terms of this Agreement in a timely safe and effective manner.

Under no circumstances shall the City be obliged to consider any proposed assignment by City if Contractor is in default at any time during the period of consideration.

13.7 Binding on Assigns
The provisions of this Agreement shall inure to the benefit to and be binding on the permitted assigns of the parties.

13.8 Transition to Next Contractor
If the transition of services to another Contractor occurs through expiration of term, default and termination, or otherwise, Contractor will cooperate with City and subsequent Contractor(s) to assist in an orderly transition which will include Contractor providing route lists and billing information. Contractor will not be obliged to sell collection vehicles or Containers to the next Cunlraclur. Depending un Contractor's circumstances at the point of transition, Contractor at its option may enter into negotiations with the next Contractor to sell (in part or all) Collection vehicles and/or containers.

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of any pre-existing or concurrent breach or violation by the other party of any provision of this Agreement.

If to City:

If to Contractor:

Utilities Director
City of San Luis Obispo
879 Morro Street
San Luis Obispo, CA 93401
Mike Dean
San Luis Garbage Company
4388 Old Santa Fe Road
San Luis Obispo, CA 93401
The address to which communications may be delivered may be changed from time to time by a notice given in accordance with this Section. The notice, if mailed, is deemed served three (3) days after the mailing.

Contractor shall, by the etlective date, designate in writing a responsible officer who shall serve as the representative of Contractor in all matters related to the Agreement and shall inform City in writing of such designation and of any limitations upon his or her authority to bind Contractor. City may rely upon action taken by such designated representative as actions of Contractor unless they are outside the scope of the authority delegated to him/her by Contractor as communicated to City.

13.14 Citv Free to Negotiate with Third Parties
43

Page 1033 of 1208 ends

Food and Green Waste Services Agreement
City may investigate all options for the Collection and processing of Food and Green W <1ste after the expiration of the Term. Without limiting generality of the foregoing, City may solicit proposals from Contractor and from third parties for the provision of Food and Green Waste services, and any combination thereof, and may negotiate and execute Agreements for such services which will take effect upon the expiration or earlier termination under Section 12.1 (Events of Default) of this Agreement.

13.16 Privacy
Contractor shall strictly observe and protect the rights of privacy of customers. Information identifying individual customers or the composition or contents of a customer's waste stream shall not be revealed to any person, governmental unit, private agency, or contractor, unless upon the authority of a court oflaw, by statute, or upon valid authorization of the customer.

Page 1034 of 1208 ends

14.1 Entire Agreement
Food and Green Waste Services Agreement
ARTICLE 14

MISCELLANEOUS AGREEMENTS
This Agreement, including the exhibits, represents the full and entire Agreement between the parties with respect to the matters covered herein.

14.3 References to laws and Other Agreements
All references in this Agreement to laws shall be understood to include such laws as they may be subsequently amended or recodified, unless otherwise specifically provided. This Agreement supersedes any and all Agreements for Food and Green Waste Collection, processing and/or marketing heretofore entered into by the parties and the City.

14.4 Interpretation .

This Agreement, including the exhibits attached hereto, shall be inre.J:pret~d and.cQnstrued reasonably and neither for nor against either party, regardless of the degree t~ which either party participated in its drafting.

14.S Agreement
This Agreement may not be modified or amended in any respect except by a writing signed by the parties.

14.6 Scvcrability
If any non-material provision of this Agreement is for any reason deemed to be invalid and unenforceable, the invalidity or unenforceability of such provision shall not affect any of the remaining provisions of this Agreement which shall be enforced as if such invalid or unenforceable provision had not been contained herein.
45

Page 1035 of 1208 ends

Food and Green Waste Services Agreement
rN WITNESS WHEREOF, City and Contractor have executed this Agreement as of the day and year first above written.

The City of San Luis Obispo
("City")
Attest:

San Luis Garbage Company
("Contractor")
46

Page 1036 of 1208 ends

Notice of Public Hearing Regarding
Proposed Solid Waste Rate Increase
Residential Property Owners and Tenants - Customers:

This notice is intended to inform you that the City of San Luis Obispo (the “City”) will hold a public hearing regarding rate adjustments (the “Proposed Rate Increase”) proposed by San Luis Garbage Company (the “Garbage Company”) for properties and customers receiving solid waste, recycling, and green waste services within the City. The Proposed Rate Increase will be considered by the San Luis Obispo City Council at the date, time, and location specified below. Consistent with the requirements of Proposition 218, this notice also provides you with the following information:
● The Amount of the Proposed Rate Increase;
● The Date, Time, and Place of the Public Hearing;
● The Majority Protest Procedures;
● The Reason for the Proposed Rate Increase; and
● The Basis for the Proposed Rate Increase.

NOTICE OF PUBLIC HEARING
The Public Hearing for the Proposed Rate Increase within the City limits will be held on:

Date: April 19, 2022 Time: 6:00 pm
Place: San Luis Obispo City Hall, 990 Palm Street, San Luis Obispo, CA At the Public Hearing, the City Council will consider all public comment in support of and in opposition to the Proposed Rate Increase and whether or not a Majority Protest exists pursuant to the California Constitution (as described below). If approved, the Proposed Rate Increase would become effective on May 1, 2022.

HOW DO I PROTEST THE PROPOSED RATE INCREASE?
Pursuant to Section 6 of Article XIII D of the California Constitution, the following persons may submit a written protest against the Proposed Rate Increase to the City Clerk before the close of the Public Hearing referenced above.
▪ An owner(s) of property (parcel(s)) receiving solid waste services within the City limits. If the person(s) signing the protest, as an owner, is not shown on the last equalized assessment roll as the owner of the parcel(s) then the protest must contain or be accompanied by written evidence that such person signing the protest is the owner of the parcel(s) receiving services; or
▪ A tenant(s) whose name appears on the Garbage Company’s records as the customer of record for the corresponding parcel receiving solid waste services within the City limits (tenant-customer).

A valid written protest must contain a statement that you protest the Proposed Rate Increase, the address or Assessor’s Parcel Number (APN) of the parcel or parcels which receive solid waste, recycling, and green waste services, and a signature by either the owner or the tenant-customer of the parcel or parcels. One written protest per parcel shall be counted in calculating a majority protest to the Proposed Rate Increase subject to the requirements of Section 6 of Article XIII D of the California Constitution. Written protests will not be

Page 1037 of 1208 ends

accepted by e-mail or by facsimile. Verbal protests will not be counted in determining the existence of a majority protest. To be counted, a protest must be received in writing by the City Clerk before the close of the Public Hearing referenced above.

Written protests regarding the solid waste rate increase may be mailed to:

City of San Luis Obispo
Attn: City Clerk
990 Palm Street
San Luis Obispo, CA 93401-3249
Written protests may also be personally delivered to the City Clerk at San Luis Obispo City Hall located at 990 Palm Street, San Luis Obispo, California.

If valid written protests are presented by a majority of owners and/or tenants-customers of parcels receiving solid waste, recycling, and green waste services within the City limits, then the City will not adjust/increase the rates for the services.

Reason for the Proposed Rate Increase
The Proposed Rate Increase is 17.75 percent for solid waste, recycling, and green waste/organics collection services. In addition, there will be a temporary 8.88 percent increase to account for a deficit in funding due to this rate increase being delayed from January 1, 2022 to May 1, 2022. The temporary 8.88 percent increase will expire January 1, 2023. The increase is necessary for the Garbage Company to continue to provide safe, environmentally sound, and reliable solid waste, recycling, green waste/organics collection, transportation, and disposal and processing services to the City. Several factors contributed to this rate increase including, but not limited to: increased costs associated with the purchase and operation of collection vehicles, fuel costs, labor costs, and increased costs associated with the organics digester facility.

California Senate Bill 1383 (SB 1383) is a recent state law passed with the goal of reducing methane through a reduction in landfilled organic waste. Methane is a potent greenhouse gas, with more than 80 times the warming power of carbon dioxide and is a major component of decomposing organic waste. In response to the harmful effects of methane gas, the California Department of Resources Recycling and Recovery adopted regulations implementing SB 1383 in the Fall of 2020. Added responsibilities associated with SB 1383 include diverting organic materials (facilitated by the local organics digestion facility), expanding organic waste collection programs to include food waste, monitoring organics carts for contamination, and reporting data.

Basis of the Proposed Rate Increase
The Proposed Rate Increase of 17.75 percent is based on the following cost increases incurred by the Garbage Company:

1. 3.84 percent of the Proposed Rate Increase is for capital investment costs of new collection vehicles, replacement containers and additional containers to meet the demands of SB 1383 compliance.

2. 3.70 percent of the Proposed Rate Increase is for increased capital equipment investments and escalating operating expenses related to the Anaerobic Digester.

3. 1.99 percent of the Proposed Rate Increase is for market wage adjustments to attract and retain safe, quality employees.

4. 1.06 percent of the Proposed Rate Increase is for increases in insurance premiums.

Page 1038 of 1208 ends

5. 1.55 percent of the Proposed Rate Increase is for increased AB 939 fee costs, which are used to fund the City waste diversion programs associated with California Assembly Bill 939 and Senate Bill 1383.

6. 5.61 percent of the Proposed Rate Increase is for increases in other operational expenses including a Consumer Price Index increase of 5.3 percent.

The additional 8.88 percent temporary increase is for the delayed rate implementation that was no fault of the Garbage Company. The total rate increase implemented May 1, 2022 will be 26.63 percent. The

8.88 percent temporary increase will expire January 1, 2023, net of any Consumer Price Index adjustment as discussed next.

Regularly scheduled interim year rate increases shall commence on January 1, 2023 and January 1, 2024 and are based on the following:

1. Increases, if any, in the Consumer Price Index (CPI) for Bureau of Labor Statistics’ Consumer Price Index for Urban Consumers based on the All U.S. City Average, Bureau of Labor Statistics for the month of June 2022 for January 1, 2023 and June 2023 for January 1, 2024. The January 1, 2023 CPI rate adjustment will be applied after the 8.88 percent temporary rate increase is removed.

Additionally, at the March 9, 2022 San Luis Obispo County Integrated Waste Management Authority (IWMA) Board Meeting, a fee increase to account for operational and capital cost increases due largely to implementation of SB 1383 will be presented for adoption. If adopted, the fee increase will be implemented starting July 1, 2022 and will not exceed 5.4%. If adopted, the Garbage Company is authorized to bill this fee to the rate payers benefiting from these additional services in compliance with Proposition 218.

The IWMA is a Joint Powers Authority formed to plan and implement regional solid waste and hazardous waste programs mandated by State law. The Joint Powers Agreement between the City of San Luis Obispo and the IWMA can be made available by the City upon request or on the IWMA website at www.iwma.com.

A copy of the 2022 Base Year Rate Adjustment Application, which provides additional information on the proposed rate increases, is available at the City Clerk’s office located at 990 Palm Street, San Luis Obispo, California and online at sanluisgarbage.com.

Page 1039 of 1208 ends

SAN LUIS GARBAGE COMPANY, INC. APPROVED BASE RATE INCREASE

CITY OF SAN LUIS OBISPO

SERVICE DESCRIPTION PICK
UPS
PER
WEEK

CURRENT
RATE

APPROVED
RATE

ADJUSTMENT
$
NEW

MONTHLY
RATE

EFFECTIVE
5/1/2022
SINGLE FAMILY AND MULTI-UNIT RESIDENTIAL (4 UNITS OR LESS) Price per month for specified waste-wheeler container collected once each week. One Greenwaste container and one recycling container service is included at no additional charge.

MINI-CAN SERVICE
One 19 gallon waste wheeler container 1 $11.14 $2.97 $14.11

ECONOMY RATE
One 32 gallon waste wheeler container 1 $17.78 $4.73 $22.51

STANDARD RATE
One 64 gallon waste wheeler container 1 $35.56 $9.47 $45.03

PREMIUM RATE
One 96 gallon waste wheeler container 1 $53.35 $14.21 $67.56

PREMIUM PLUS RATE
One 96 gallon waste wheeler at the premium rate
plus an additional charge of:

One 32 gallon waste wheeler container 1 $16.21 $4.31 $20.52 One 64 gallon waste wheeler container 1 $32.45 $8.64 $41.08 One 96 gallon waste wheeler container 1 $48.64 $12.95 $61.58 DESIGNED MANUAL SERVICE (determined by city
staff)
MINI-CAN SERVICE 1 $18.09 $4.82 $22.91
ECONOMY RATE 1 $28.94 $7.70 $36.64
STANDARD RATE 1 $57.92 $15.42 $73.34
PREMIUM RATE 1 $86.83 $23.12 $109.94
One 96 gallon waste wheeler at the premium rate
plus an additional charge of:

PREMIUM PLUS 32 GALLON CAN RATE 1 $25.94 $6.91 $32.85
PREMIUM PLUS 64 GALLON CAN RATE 1 $51.89 $13.82 $65.71
PREMIUM PLUS 96 GALLON CAN RATE 1 $77.86 $20.73 $98.59
LONG TERM VACANT RATE (UNFURNISHED) 1 $9.14 $2.43 $11.57

SERVICE AWAY FROM THE STREET CURB
Additional per month per can or container charge $12.12 $3.23 $15.35 USED OIL COLLECTION - no charge (Call for details and pick up information).

Page 1040 of 1208 ends

SERVICE DESCRIPTION PICK
UPS
PER
WEEK

CURRENT
RATE

APPROVED
RATE

ADJUSTMENT
$
NEW

MONTHLY
RATE

EFFECTIVE
5/1/2022
LATE MAKEUP COLLECTIONS WITH GARBAGE TRUCK (Phone call required) Per trip charge plus charges identified below for any
extra containers or equivalent volume. $17.94 $4.78 $22.72 Additional charge per 32 gallon can or equivalent
volume per collection (i.e. 64-gallon x2, 96-gallon x3). $8.90 $2.37 $11.27 RESIDENTIAL - OTHER CHARGES:

TAX LIEN CERT. MAIL FEE $4.05 $1.08 $5.13
SPECIAL TRIP FEE $53.81 $14.33 $68.14
LOOSE CARDBOARD $9.54 $2.54 $12.08
RESTART FEE-RESIDENTIAL $26.90 $7.16 $34.06
WHITE GOODS $33.61 $8.95 $42.56
XTRA RECYCLE 64 OR 96 GAL CART $3.73 $0.99 $4.72
XTRA GREENWASTE 64 OR 96 GAL CART $6.92 $1.84 $8.76
EXTRA COLLECTIONS WITH PICKUP OR FLATBED TRUCK (Phone call required) Per trip, plus applicable amount below: $26.90 $7.16 $34.06 Per garbage can or equivalent volume. (Over 6
cans by quotation) $8.90 $2.37 $11.27
Per recycling can or equivalent volume. (Over 6
cans by quotation) $4.45 $1.18 $5.63
Per white good article/ appliance. (Once a month
only) $19.88 $5.29 $25.17
Per piece of furniture. $19.88 $5.29 $25.17
Per mattress or boxspring. $19.88 $5.29 $25.17
Other Service Notes:

1. Customers requesting Temporary Bins or Roll-off Box Service can call the office for current rates

2. Polystyrene (Styrofoam, Plastic #6) is not collected for recycling and should be thrown away as trash. Please bag Styrofoam packing peanuts before placing in trash container.

3. This solid service fee for trash collections (container with black or gray lid) includes once a week pick-up of one greenwaste/organics container (green lid), one recycling container (blue lid).

4. It is encouraged to bag your trash in the garbage container but do not bag your recyclables or green waste in their respective containers and keep it loose.

5. Recycling, Greenwaste/Organics and Garbage containers should be spaced 3 feet apart away from any obstacles (i.e mailboxes, cars, etc) before 6:00am on collection service day.

6. The fee schedule above only includes the Garbage Company rates and does not include IWMA fees, which are separately noted on the billings.

7. Cleaning fees will be billed on a time and materials basis

8. Late Fees are imposed for residential customers over 30 days delinquent. The fee is 1.5% per month of the outstanding charge, with a minimum fee of $5.00. No prior notice is required, as this late fee policy is stated at the bottom of every bill.

Effective date for rates in Current Rate column was: 1/1/2021 This increase is approximately : 26.63%
Effective
Date: 5/1/2022

Page 1041 of 1208 ends

Page 1042 of 1208 ends

Notice of Public Hearing Regarding
Proposed Solid Waste Rate Increase
Commercial Property Owners and Tenants-Customers:

NOTICE OF PUBLIC HEARING
The Public Hearing for the Proposed Rate Increase within the City limits will be held on:

Page 1043 of 1208 ends

the requirements of Section 6 of Article XIII D of the California Constitution. Written protests will not be accepted by e-mail or by facsimile. Verbal protests will not be counted in determining the existence of a majority protest. To be counted, a protest must be received in writing by the City Clerk before the close of the Public Hearing referenced above.

Written protests regarding the solid waste rate increase may be mailed to:

Basis of the Proposed Rate Increase
The Proposed Rate Increase of 17.75 percent is based on the following cost increases incurred by the Garbage Company:

1. 3.84 percent of the Proposed Rate Increase is for capital investment costs of new collection vehicles, replacement containers and additional containers to meet the demands of SB 1383 compliance.

2. 3.70 percent of the Proposed Rate Increase is for increased capital equipment investments and escalating operating expenses related to the Anaerobic Digester.

3. 1.99 percent of the Proposed Rate Increase is for market wage adjustments to attract and retain safe, quality employees.

4. 1.06 percent of the Proposed Rate Increase is for increases in insurance premiums.

Page 1044 of 1208 ends

6. 5.61 percent of the Proposed Rate Increase is for increases in other operational expenses including a Consumer Price Index increase of 5.3 percent.

8.88 percent temporary increase will expire January 1, 2023, net of any Consumer Price Index adjustment as discussed next.

Regularly scheduled interim year rate increases shall commence on January 1, 2023 and January 1, 2024 and are based on the following:

Page 1045 of 1208 ends

SAN LUIS GARBAGE COMPANY, INC. APPROVED BASE RATE INCREASE

CITY OF SAN LUIS OBISPO
Description Frequency Current Rate Increase $ New Rate
LATE MAKEUP COLLECTIONS WITH GARBAGE TRUCK (Phone call required) Per trip charge plus charges identified below for
any extra containers or equivalent volume. Per Trip $18.10 $4.82 $22.92 Additional charge per 32 gallon can or equivalent
volume per collection (i.e. 64-gallon x2, 96-gallon
x3). Unit $9.70 $2.58 $12.28
EXTRA COLLECTIONS WITH PICKUP OR FLATBED TRUCK (Phone call required) Per trip, plus applicable amount below: $27.13 $7.22 $34.35 Per garbage can or equivalent volume.
(Over 6 cans by quotation) $9.70 $2.58 $12.28
Per recycling can or equivalent volume.
(Over 6 cans by quotation) $4.49 $1.20 $5.69
Per white good article/ appliance. (Once a
month only) $19.93 $5.31 $25.24
Per piece of furniture. $19.93 $5.31 $25.24
Per mattress or boxspring. $19.93 $5.31 $25.24
Delivery Charge Per Trip $29.35 $7.81 $37.16
Commercial maintenance fee Per Trip $27.13 $7.22 $34.35

COMMERCIAL GARBAGE CANS SERVICE PER MONTH
One 32 Gallon Waste Wheeler 1 $31.63 $8.42 $40.05
One 32 Gallon Waste Wheeler 2 $49.64 $13.22 $62.86
One 32 Gallon Waste Wheeler 3 $67.76 $18.04 $85.80
One 32 Gallon Waste Wheeler 4 $85.78 $22.84 $108.62
One 32 Gallon Waste Wheeler 5 $103.82 $27.64 $131.46
One 32 Gallon Waste Wheeler 6 $121.89 $32.46 $154.35
One 32 Gallon Waste Wheeler 7 $139.91 $37.25 $177.16
Two 32 Gallon Waste Wheelers 1 $40.64 $10.82 $51.46
Two 32 Gallon Waste Wheelers 2 $63.25 $16.84 $80.09
Two 32 Gallon Waste Wheelers 3 $85.80 $22.85 $108.65
Two 32 Gallon Waste Wheelers 4 $108.37 $28.86 $137.23
Two 32 Gallon Waste Wheelers 5 $131.00 $34.88 $165.88
Two 32 Gallon Waste Wheelers 6 $153.56 $40.89 $194.45
Two 32 Gallon Waste Wheelers 7 $176.13 $46.90 $223.03
Three 32 Gallon Waste Wheelers 1 $49.67 $13.23 $62.90
Three 32 Gallon Waste Wheelers 2 $76.83 $20.46 $97.29
Three 32 Gallon Waste Wheelers 3 $103.89 $27.66 $131.55 Three 32 Gallon Waste Wheelers 4 $131.05 $34.90 $165.95 Three 32 Gallon Waste Wheelers 5 $158.11 $42.10 $200.21 Three 32 Gallon Waste Wheelers 6 $185.21 $49.31 $234.52 Three 32 Gallon Waste Wheelers 7 $212.34 $56.54 $268.88 Four 32 Gallon Waste Wheelers 1 $58.72 $15.64 $74.36
Four 32 Gallon Waste Wheelers 2 $90.35 $24.06 $114.41
Four 32 Gallon Waste Wheelers 3 $121.93 $32.47 $154.40

Page 1046 of 1208 ends

Description Frequency Current Rate Increase $ New Rate
Four 32 Gallon Waste Wheelers 4 $153.57 $40.89 $194.46
Four 32 Gallon Waste Wheelers 5 $185.18 $49.31 $234.49
Four 32 Gallon Waste Wheelers 6 $216.83 $57.73 $274.56
Four 32 Gallon Waste Wheelers 7 $248.39 $66.14 $314.53
Five 32 Gallon Waste Wheelers 1 $67.78 $18.05 $85.83
Five 32 Gallon Waste Wheelers 2 $103.87 $27.66 $131.53
Five 32 Gallon Waste Wheelers 3 $140.01 $37.28 $177.28
Five 32 Gallon Waste Wheelers 4 $176.12 $46.89 $223.01
Five 32 Gallon Waste Wheelers 5 $212.30 $56.53 $268.82
Five 32 Gallon Waste Wheelers 6 $248.37 $66.13 $314.50
Five 32 Gallon Waste Wheelers 7 $284.49 $75.75 $360.24
Six 32 Gallon Waste Wheelers 1 $76.83 $20.46 $97.29
Six 32 Gallon Waste Wheelers 2 $117.42 $31.26 $148.68
Six 32 Gallon Waste Wheelers 3 $158.04 $42.08 $200.12
Six 32 Gallon Waste Wheelers 4 $198.70 $52.91 $251.61
Six 32 Gallon Waste Wheelers 5 $239.30 $63.72 $303.02
Six 32 Gallon Waste Wheelers 6 $279.95 $74.54 $354.49
Six 32 Gallon Waste Wheelers 7 $320.57 $85.36 $405.93

1. Rates for all “Waste Wheeler Container Service” customers include recycling or greenwaste/organics pickup once per-week. Customers can choose from a 64 or 96 gallon blue waste wheeler once per week for commingled recycling or a 32 or 64 gallon organics green lid waste wheeler once per week for organics collections. More frequent than once-per-week pickup can be provided at 25% of the garbage service rate for the specified level of service required.

Due to potential weight issues, organics is only collected in 32 or 64 gallon green lidded waste wheelers.

COMMERCIAL WASTE WHEELER CONTAINER SERVICE PER MONTH
One 96 Gallon Waste Wheeler 1 $56.37 $15.01 $71.38
One 96 Gallon Waste Wheeler 2 $90.25 $24.03 $114.28
One 96 Gallon Waste Wheeler 3 $124.13 $33.05 $157.18
One 96 Gallon Waste Wheeler 4 $157.98 $42.06 $200.04
One 96 Gallon Waste Wheeler 5 $191.90 $51.10 $243.00
One 96 Gallon Waste Wheeler 6 $225.73 $60.10 $285.83
One 96 Gallon Waste Wheeler 7 $259.61 $69.13 $328.74
Two 96 Gallon Waste Wheelers 1 $92.39 $24.60 $116.99
Two 96 Gallon Waste Wheelers 2 $142.02 $37.81 $179.83
Two 96 Gallon Waste Wheelers 3 $191.70 $51.04 $242.74
Two 96 Gallon Waste Wheelers 4 $241.34 $64.26 $305.60
Two 96 Gallon Waste Wheelers 5 $291.03 $77.49 $368.52
Two 96 Gallon Waste Wheelers 6 $340.65 $90.70 $431.35
Two 96 Gallon Waste Wheelers 7 $390.39 $103.95 $494.34
Three 96 Gallon Waste Wheelers 1 $128.41 $34.19 $162.60 Three 96 Gallon Waste Wheelers 2 $193.87 $51.62 $245.49 Three 96 Gallon Waste Wheelers 3 $259.35 $69.06 $328.41 Three 96 Gallon Waste Wheelers 4 $324.82 $86.49 $411.31 Three 96 Gallon Waste Wheelers 5 $390.31 $103.93 $494.24 Three 96 Gallon Waste Wheelers 6 $455.75 $121.35 $577.10

Page 1047 of 1208 ends

Description Frequency Current Rate Increase $ New Rate
Three 96 Gallon Waste Wheelers 7 $521.23 $138.79 $660.02 Four 96 Gallon Waste Wheelers 1 $164.41 $43.78 $208.19
Four 96 Gallon Waste Wheelers 2 $245.70 $65.42 $311.12
Four 96 Gallon Waste Wheelers 3 $327.72 $87.26 $414.98
Four 96 Gallon Waste Wheelers 4 $408.25 $108.70 $516.95 Four 96 Gallon Waste Wheelers 5 $489.55 $130.35 $619.90 Four 96 Gallon Waste Wheelers 6 $570.78 $151.98 $722.76 Four 96 Gallon Waste Wheelers 7 $652.13 $173.64 $825.77 Five 96 Gallon Waste Wheelers 1 $200.44 $53.37 $253.81
Five 96 Gallon Waste Wheelers 2 $297.59 $79.24 $376.83
Five 96 Gallon Waste Wheelers 3 $394.62 $105.07 $499.69 Five 96 Gallon Waste Wheelers 4 $491.71 $130.93 $622.64 Five 96 Gallon Waste Wheelers 5 $588.78 $156.77 $745.56 Five 96 Gallon Waste Wheelers 6 $685.89 $182.63 $868.51 Five 96 Gallon Waste Wheelers 7 $811.68 $216.12 $1,027.80 Six 96 Gallon Waste Wheelers 1 $236.48 $62.97 $299.45
Six 96 Gallon Waste Wheelers 2 $349.38 $93.03 $442.41
Six 96 Gallon Waste Wheelers 3 $462.27 $123.09 $585.36
Seven 96 Gallon Waste Wheelers 1 $272.49 $72.55 $345.04 Eight 96 Gallon Waste Wheelers 1 $308.52 $82.15 $390.67 Eight 96 Gallon Waste Wheelers 7 $1,175.60 $313.02 $1,488.62

1. Rates for all “Waste Wheeler Container Service” customers include recycling or greenwaste/organics pickup once per-week. Customers can choose from a 64 or 96 gallon blue waste wheeler once per week for commingled recycling or 32 or 64 gallon organics green lid waste wheeler once per week for organics collections. More frequent than onceper-week pickup can be provided at 25% of the garbage service rate for the specified level of service required. Due to potential weight issues, organics is only collected in 32 or 64 gallon green lidded waste wheelers.

MULTI-UNIT RESIDENTIAL DUMPSTER CONTAINERS (PER MONTH)
1 Yd Dumpster 1 $128.71 $34.27 $162.98
1 Yd Dumpster 2 $187.46 $49.91 $237.37
1 Yd Dumpster 3 $246.11 $65.53 $311.64
1 Yd Dumpster 4 $304.81 $81.16 $385.97
1 Yd Dumpster 5 $363.56 $96.80 $460.36
1 Yd Dumpster 6 $422.20 $112.42 $534.62
1 Yd Dumpster 7 $480.91 $128.05 $608.96

1.5 Yd Dumpster 1 $149.02 $39.68 $188.70

1.5 Yd Dumpster 2 $230.29 $61.32 $291.61

1.5 Yd Dumpster 3 $311.60 $82.97 $394.57

1.5 Yd Dumpster 4 $392.86 $104.60 $497.46

1.5 Yd Dumpster 5 $474.13 $126.25 $600.38

1.5 Yd Dumpster 6 $555.40 $147.88 $703.28

1.5 Yd Dumpster 7 $636.66 $169.52 $806.18

Page 1048 of 1208 ends

Description Frequency Current Rate Increase $ New Rate
2 Yd Dumpster 1 $169.33 $45.09 $214.42
2 Yd Dumpster 2 $270.95 $72.14 $343.09
2 Yd Dumpster 3 $372.53 $99.19 $471.72
2 Yd Dumpster 4 $474.13 $126.24 $600.37
2 Yd Dumpster 5 $575.72 $153.30 $729.02
2 Yd Dumpster 6 $677.32 $180.35 $857.67
2 Yd Dumpster 7 $778.89 $207.39 $986.28
3 Yd Dumpster 1 $209.95 $55.90 $265.85
3 Yd Dumpster 2 $352.23 $93.79 $446.02
3 Yd Dumpster 3 $494.46 $131.66 $626.12
3 Yd Dumpster 4 $636.73 $169.54 $806.27
3 Yd Dumpster 5 $778.93 $207.40 $986.33
3 Yd Dumpster 6 $921.21 $245.29 $1,166.50
3 Yd Dumpster 7 $1,063.46 $283.16 $1,346.62
4 Yd Dumpster 1 $250.62 $66.73 $317.35
4 Yd Dumpster 2 $435.75 $116.02 $551.77
4 Yd Dumpster 3 $620.94 $165.33 $786.27
4 Yd Dumpster 4 $806.10 $214.64 $1,020.74
4 Yd Dumpster 5 $991.22 $263.93 $1,255.15
4 Yd Dumpster 6 $1,176.41 $313.24 $1,489.65
4 Yd Dumpster 7 $1,361.62 $362.55 $1,724.17
6 Yd Dumpster 1 $331.87 $88.37 $420.24
6 Yd Dumpster 2 $600.56 $159.91 $760.47
6 Yd Dumpster 3 $869.28 $231.46 $1,100.74
6 Yd Dumpster 4 $1,137.98 $303.00 $1,440.98
6 Yd Dumpster 5 $1,406.70 $374.55 $1,781.25
6 Yd Dumpster 6 $1,728.09 $460.13 $2,188.22
6 Yd Dumpster 7 $1,962.15 $522.45 $2,484.60
COMMERCIAL DUMPSTER CONTAINER SERVICE - In cubic yards
1 Yd Dumpster 1 $112.89 $30.06 $142.95
1 Yd Dumpster 2 $158.04 $42.08 $200.12
1 Yd Dumpster 3 $203.22 $54.11 $257.33
1 Yd Dumpster 4 $248.37 $66.13 $314.50
1 Yd Dumpster 5 $293.51 $78.15 $371.66
1 Yd Dumpster 6 $338.69 $90.18 $428.87
1 Yd Dumpster 7 $383.85 $102.21 $486.06

1.5 Yd Dumpster 1 $126.45 $33.67 $160.12

1.5 Yd Dumpster 2 $185.13 $49.29 $234.42

1.5 Yd Dumpster 3 $243.81 $64.92 $308.73

1.5 Yd Dumpster 4 $302.54 $80.56 $383.10

1.5 Yd Dumpster 5 $361.23 $96.18 $457.41

1.5 Yd Dumpster 6 $419.96 $111.82 $531.78

1.5 Yd Dumpster 7 $478.66 $127.45 $606.11

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Description Frequency Current Rate Increase $ New Rate
2 Yd Dumpster 1 $139.98 $37.27 $177.25
2 Yd Dumpster 2 $209.97 $55.91 $265.88
2 Yd Dumpster 3 $280.02 $74.56 $354.58
2 Yd Dumpster 4 $349.98 $93.19 $443.17
2 Yd Dumpster 5 $419.99 $111.83 $531.82
2 Yd Dumpster 6 $489.99 $130.47 $620.46
2 Yd Dumpster 7 $559.98 $149.10 $709.08
3 Yd Dumpster 1 $167.08 $44.49 $211.57
3 Yd Dumpster 2 $264.14 $70.33 $334.47
3 Yd Dumpster 3 $361.23 $96.18 $457.41
3 Yd Dumpster 4 $458.33 $122.04 $580.37
3 Yd Dumpster 5 $555.40 $147.88 $703.28
3 Yd Dumpster 6 $652.50 $173.74 $826.24
3 Yd Dumpster 7 $749.62 $199.60 $949.22
4 Yd Dumpster 1 $194.14 $51.69 $245.83
4 Yd Dumpster 2 $320.60 $85.36 $405.96
4 Yd Dumpster 3 $447.01 $119.02 $566.03
4 Yd Dumpster 4 $573.48 $152.70 $726.18
4 Yd Dumpster 5 $699.90 $186.36 $886.26
4 Yd Dumpster 6 $826.33 $220.02 $1,046.35
4 Yd Dumpster 7 $952.81 $253.70 $1,206.51
6 Yd Dumpster 1 $248.32 $66.12 $314.44
6 Yd Dumpster 2 $426.71 $113.62 $540.33
6 Yd Dumpster 3 $605.12 $161.12 $766.24
6 Yd Dumpster 4 $783.51 $208.62 $992.13
6 Yd Dumpster 5 $961.91 $256.12 $1,218.03
6 Yd Dumpster 6 $1,140.28 $303.62 $1,443.90
6 Yd Dumpster 7 $1,318.71 $351.13 $1,669.84
8 Yd Dumpster 1 $302.51 $80.55 $383.06
8 Yd Dumpster 2 $532.80 $141.87 $674.66
8 Yd Dumpster 3 $763.13 $203.19 $966.32
8 Yd Dumpster 4 $993.47 $264.53 $1,258.00
8 Yd Dumpster 5 $1,223.80 $325.86 $1,549.66
8 Yd Dumpster 6 $1,454.07 $387.17 $1,841.24
8 Yd Dumpster 7 $1,684.41 $448.50 $2,132.91
Sunday Service * $79.04 $21.05 $100.09
The rates shown above include the monthly container rental fee and are the same for bins and garwoods, when volume is identical. (Bins and garwoods are types of containers)

UNSCHEDULED EXTRA COLLECTIONS
FOR COMMERCIAL CUSTOMERS & MULTIUNIT
1 CUBIC YARD Per Lift $51.96 $13.84 $65.80

1.5 CUBIC YARD Per Lift $57.62 $15.34 $72.96

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Description Frequency Current Rate Increase $ New Rate
2 CUBIC YARDS Per Lift $67.77 $18.04 $85.81
3 CUBIC YARDS Per Lift $83.54 $22.24 $105.78
4 CUBIC YARDS Per Lift $99.34 $26.45 $125.79
Rates for all commercial customers for unscheduled extra collections of recycling can be provided at a 25% of the garbage service rate for the specified level of service required.

COMMERCIAL - OTHER CHARGES:

LOOSE CARDBOARD Per Yard $9.61 $2.56 $12.17
LOOSE YARDAGE (SOLID WASTE) Per Yard $38.38 $10.22 $48.60 RENTAL Per Month $45.20 $12.04 $57.24
TEMPORARY RENTAL CHARGE Per Day $1.51 $0.40 $1.91
WHITE GOODS Per Unit $33.88 $9.02 $42.90
TAX LIEN CERT. MAIL FEE Per Mailing $4.08 $1.09 $5.17
LOCK CHARGE-FRONT Per Month $84.78 $22.57 $107.35
LOCK CHARGE-REAR Per Month $73.11 $19.47 $92.58
STAND BY TIME Per Minute $1.26 $0.34 $1.60
COMPACTORS (PER TON) Per Ton $55.78 $14.85 $70.63
COMPACTORS (HAUL RATE) Per Hour $173.33 $46.15 $219.49

RECYCLING SERVICES

CARDBOARD & COMMINGLED RECYCLING COLLECTION OF COMMERCIAL DUMPSTER CONTAINERS 1 Yd Dumpster 1 INCLUDED * INCLUDED *
1 Yd Dumpster 2 INCLUDED * INCLUDED *
1 Yd Dumpster 3 $50.81 $13.53 $64.34
1 Yd Dumpster 4 $62.31 $16.59 $78.90
1 Yd Dumpster 5 $73.35 $19.53 $92.88
1 Yd Dumpster 6 $84.70 $22.55 $107.25
1 Yd Dumpster 7 $95.95 $25.55 $121.49

1.5 Yd Dumpster 1 INCLUDED * INCLUDED *

1.5 Yd Dumpster 2 INCLUDED * INCLUDED *

1.5 Yd Dumpster 3 $60.96 $16.23 $77.19

1.5 Yd Dumpster 4 $75.62 $20.13 $95.75

1.5 Yd Dumpster 5 $90.29 $24.04 $114.33

1.5 Yd Dumpster 6 $104.96 $27.95 $132.91

1.5 Yd Dumpster 7 $119.67 $31.86 $151.53
2 Yd Dumpster 1 INCLUDED * INCLUDED *
2 Yd Dumpster 2 INCLUDED * INCLUDED *
2 Yd Dumpster 3 $69.99 $18.64 $88.63
2 Yd Dumpster 4 $87.49 $23.30 $110.79
2 Yd Dumpster 5 $104.97 $27.95 $132.92
2 Yd Dumpster 6 $122.52 $32.62 $155.14
2 Yd Dumpster 7 $140.00 $37.28 $177.27
3 Yd Dumpster 1 INCLUDED * INCLUDED *
3 Yd Dumpster 2 INCLUDED * INCLUDED *
3 Yd Dumpster 3 $90.29 $24.04 $114.33
3 Yd Dumpster 4 $114.62 $30.52 $145.14
3 Yd Dumpster 5 $138.86 $36.97 $175.83

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Description Frequency Current Rate Increase $ New Rate
3 Yd Dumpster 6 $163.13 $43.44 $206.57
3 Yd Dumpster 7 $187.40 $49.90 $237.30
4 Yd Dumpster 1 INCLUDED * INCLUDED *
4 Yd Dumpster 2 INCLUDED * INCLUDED *
4 Yd Dumpster 3 $111.79 $29.77 $141.56
4 Yd Dumpster 4 $143.37 $38.17 $181.54
4 Yd Dumpster 5 $175.00 $46.60 $221.60
4 Yd Dumpster 6 $206.63 $55.02 $261.65
4 Yd Dumpster 7 $238.19 $63.42 $301.61
6 Yd Dumpster 1 INCLUDED * INCLUDED *
6 Yd Dumpster 2 INCLUDED * INCLUDED *
6 Yd Dumpster 3 $151.30 $40.29 $191.59
6 Yd Dumpster 4 $195.89 $52.16 $248.05
6 Yd Dumpster 5 $240.50 $64.04 $304.54
6 Yd Dumpster 6 $285.06 $75.90 $360.96
6 Yd Dumpster 7 $329.68 $87.78 $417.46
8 Yd Dumpster 1 INCLUDED * INCLUDED *
8 Yd Dumpster 2 INCLUDED * INCLUDED *
8 Yd Dumpster 3 $181.17 $48.24 $229.41
8 Yd Dumpster 4 $235.85 $62.80 $298.65
8 Yd Dumpster 5 $290.53 $77.36 $367.89
8 Yd Dumpster 6 $353.21 $94.05 $447.26
8 Yd Dumpster 7 $409.11 $108.93 $518.05
*Rates for all commercial customers include recycling pickup twice per week free of charge for up to 4 cubic yards. If you need more frequent service, it can be provided at a 25% discount from the garbage service rates for the specified level of service required.

1. Customers requesting Temporary Bins or Roll-off Box Service can call the office for current rates.

2. Polystyrene (Styrofoam, Plastic #6) is not collected for recycling and should be thrown away as trash. Please bag Styrofoam packing peanuts before placing in trash container.

3. It is encouraged to bag your trash in the garbage container but do not bag your recyclables or green waste/organics in their respective containers and keep it loose.

4. Recycling, Greenwaste/Organcis and Garbage waste wheelers should be spaced 3 feet apart away from any obstacles (i.e mailboxes, cars, etc) before 6:00am on collection service day.

5. The fee schedule above only includes the Garbage Company rates and does not include IWMA fees, which are separately noted on the billings.

6. Cleaning fees will be billed on a time and materials basis.

7. Late Fees are imposed for residential and commercial customers over 30 days delinquent. The fee is 1.5% per month of the outstanding charge, with a minimum fee of $5.00. No prior notice is required, as this late fee policy is stated at the bottom of every bill.

Effective date for rates in Current Rate column
was: 1/1/2021
This increase is approximately : 26.63%
Effective
Date: 5/1/2022

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FINAL REPORT
City of San Luis Obispo
Submitted electronically on October 22, 2020
Submitted electronically: March 28, 2022
Review of 2022 Base Year
Rate Adjustment

Page 1053 of 1208 ends

1512 Eureka Road, Suite 220, Roseville, CA 95661 | p 916.782.7821 | f 916.782.7824 | www.r3cgi.com March 28, 2022
Ms. Jordan Lane
Solid Waste and Recycling Coordinator
Public Utilities
879 Morro, San Luis Obispo, CA 93401
submitted via email: [email protected]
SUBJECT: Review of San Luis Garbage Company’s 2022 Base Year Rate Application – Final Report
Dear Ms. Lane,
R3 Consulting Group (R3) is engaged by the City of San Luis Obispo (City) to review the 2022 Base Year Rate Applications of its franchised hauler, San Luis Garbage Company (SLG). This report presents the results of R3’s review the revised 2022 Base Year rate adjustment for SLG.

SLG’s original 2020 Base Year Rate Application calculated a net shortfall in revenues for 2022 of approximately $2,080,000, which equates to a rate increase of 18.71%. Subsequent to completion of the review, the Rate Application was revised to reflect a rate increase of 17.75%, based on a revised revenue shortfall of approximately $1,820,700.
* * * * * * *
We appreciate the opportunity to be of service to the City and would like to thank SLG’s staff for their support during the review. Staff were very responsive and provided us with requested information in a timely fashion.

Sincerely,

Jordan Muratsuchi | Sr. Project Analyst Garth Schultz | Principal R3 Consulting Group, Inc. R3 Consulting Group, Inc.
916.655.2104 | [email protected] 510.292.0853 | [email protected]

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TABLE OF CONTENTS
City of San Luis Obispo | Base Year Rate Adjustment TOC

1. Introduction
page 1

2. Review of Rate Application
page 3

3. Calculation of the Percent Change
in Rates
page 8

4. Findings
page 9

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1. INTRODUCTION
City of San Luis Obispo | Base Year Rate Adjustment 1 of 9 Background
Service Areas
The City has exclusive franchise agreements with SLG to collect and remove for disposal and recycling, residential and commercial solid waste and recyclable materials, which expire in 2025, with the City’s option to extend up to three years. The City has a separate agreement with SLG for the collection and processing of organic waste at the Kompogas Facility, which expires 20 years after commencement of facility operation.

In addition to the City, SLG also services accounts in unincorporated San Luis Obispo County. SLG’s parent company, Waste Connections, services multiple franchise regions with individual agreements.

Overview of Rate Setting Process
Per Article 9 of the City’s franchise agreement (Agreement) with SLG, the “Franchisee” (SLG) shall submit to applications to the City for rate review annually, which shall be in accordance with the procedures described in the “City of San Luis Obispo Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates” (Rate Manual), except as that may be modified by the City from time to time.

That methodology primarily involves two distinct rate setting methodologies:
》 Interim Year Rate Setting Process; and
》 Base Year Rate Setting Process.

Base year rate adjustments occur every three (3) years with indexed based rate adjustments used to set the rates for the two (2) years between rate adjustments.

The City and SLG both recognize that updates to the Rate Setting Manual, established in 1994, are warranted to reflect modern industry standard practices and a changing regulatory environment.

Base Year Rate Setting Process
For the upcoming rate year (January 1, 2022 - December 31, 2022) the current rates are to be adjusted based on the Base Year Rate Setting Process.

With the Base Year Rate Application, the franchised hauler submits financial statements for the previously completed fiscal year, which serve as the base documents for the Rate Application.

The Base Year Rate Application is based on three years of data:
》 Actual results for the most recently completed year (2020), which are based on the audited financial statements;
》 Projected results for the current year (2021), which are to be based on year-to-date information available at the time the application is submitted; and 》 Projected results for the next year (2022 - the Base Year).

Rates are established for each Base Year based on the hauler’s projected revenue requirement.

The revenue requirement is defined as the sum of the following:
》 Allowed costs;
》 Allowable operating profit; and
》 Pass through costs.

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Introduction
City of San Luis Obispo | Base Year Rate Adjustment 2 of 9 Scope of Analysis
The review of the Base Year Rate Application included but was not limited to the following:
》 Reviewed and documented the prior 2018 Base Year Rate Application adjustments, and their potential application to the 2022 Base Year Rate Application; 》 Reviewed the 2022 Base Year Rate Application for consistency with the Rate Setting Manual Methodology;
》 Reviewed the 2022 Base Year Rate Application for mathematical accuracy; 》 Reviewed SLG’s 2019 and 2020 audited financial statements; 》 Reviewed 2021 and 2022 projected revenues and expenses for reasonableness, including general consistency with changes in reported revenues, accounts, and tonnages; 》 Reviewed SLG’s survey of rates in neighboring communities.

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2. REVIEW OF RATE APPLICATION
City of San Luis Obispo | Base Year Rate Adjustment 3 of 9 Allowable Operating Ratio Costs
Direct Labor
SLG projected a 6.98% increase in Direct Labor costs for 2022 as compared to 2021 (a 7.92% increase projected in 2022 compared to 2020). SLG attributed the increased cost from 2020 to 2021 to several factors including the need for additional staff as well as increased competition for employees, stating that they are finding it difficult to retain drivers. SLG reported that multiple drivers have left the company in recent years, some of whom have joined other municipalities and others who left California entirely citing high living expenses.

SLG believes that the underlying reason for losing employees is low wages and benefits. Additionally, SLG specifically noted that competing with public pension benefits has been difficult. SLG offers a 401k retirement plan however they note that it’s not as desirable as a public pension unless additional funds can be used to offset the amount that employees are paying into the 401k. This is opposed to a public pension which is fully provided for.

Assessment
SLG’s requested a 6.98% increase in total direct labor in 2022 compared to 2021. R3 understands there is a national driver shortage across the solid waste industry, leading to high competition in most areas.

Furthermore, due to the effects of the COVID-19 pandemic the labor market as a whole is seeing high demand for employees and as a result, an overall increase in wages.

R3 concurs that increased competition for solid waste employees is real and that an increase to SLG’s labor rates may be reasonable in light of that reality. SLG provided limited data for comparison. R3 suggested an alternative and justifiable adjustment method using standard labor data from the Bureau of Labor Statistics (BLS). R3 suggested an overall increase to Direct Labor of 3.60% (from 2021 expenses), consistent with the Bureau of Labor Statistics (BLS) findings on year-over-year (ending June 2021) total compensation growth in the private industry in California (Pacific Division). Upon discussion between the City and SLG, it was determined that no adjustment to the Rate Application was necessary.

Adjustments
No adjustment.

Corporate Overhead
SLG projected a 6.14% increase Corporate Overhead between 2020 and 2022, which includes a 5.30% increase from 2021 to 2022.

Assessment
According to page I-6 in the Rate Setting Manual, SLG’s Corporate Overhead expense to the City cannot exceed $120,000 per year in 1994 dollars. SLG calculated their actual Corporate Overhead, and then subtracted out the appropriate limitation such that the total Corporate Overhead being assigned to the City is at the maximum amount.

Adjustments
No adjustment.

Office Salaries
SLG’s projected 2022 Office Salary expense is 8.68% higher than its 2021 reported expense, 84.82% higher than its 2020 reported expense, and 19.51% higher than its 2019 reported expense. SLG experienced a decrease in office salaries in 2020 compared to 2019, in part due to COVID-19. The 2021 projected office salaries expense is 10% above 2019 levels.

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Review of Rate Application
City of San Luis Obispo | Base Year Rate Adjustment 4 of 9 Assessment
SLG’s projected 2022 Office Salaries were calculated based on increases in employee wages, in the same fashion as Direct Labor, described in the previous section. SLG attributed its projected increase in Office Salaries to both increased wages and additional positions.R3 concurs that there are changes currently occurring in the economy and labor market as the COVID-19 pandemic continues. The labor market, as a whole, is seeing high demand for employees and as a result, wages have increased in most, if not all industries.

R3 suggested an overall increase to Office Salaries by 3.60% (from 2021 expenses), which is consistent with BLS findings on year-over-year total compensation growth in the private industry in California (Pacific Division). Upon discussion between the City and SLG, it was determined that no adjustment to the Rate Application was necessary.

Adjustments
No adjustments.

General and Administrative Costs
G&A costs represent the single largest overall expense category for SLG and include a wide range of expenses. SLG projects a 22.53% increase in total G&A costs, which is mainly the result of increases in Depreciation (e.g., vehicles, equipment) (38.95% / $341,716 increase), insurance (10.98% / $109,178 increase), interest (31.58% / $41,432 increase) and Outside Services (71.05% / $462,658 increase).

We assessed each expense item included in G&A costs and noted only minor increases to most expense items. In addition to further analyzing the specific expenses listed above, we also looked further into Bad Debt.

Assessment
SLG’s total G&A expenses decreased 1.23% in 2020 (from 2019) and are projected to decrease by

3.73% in 2021 compared to 2020. SLG projects a 22.53% increase in the 2022 compared to 2021, which corresponds to a 16.51% increase compared to 2019.

SLG projects minor increases in expense for most items covered under G&A, however we further analyzed the items noted below:

Depreciation
SLG used a 7-year straight-line method for calculating its depreciation on vehicles and containers, which is in alignment with the Rate Setting Manual. However, today most franchises agree to a more realistic 10-year depreciation schedule. Additionally, SLG is currently operating vehicles and utilizing containers that have passed the designated 7-year mark. SLG allocates depreciation from their total company amount to each individual franchise based on percentages of container counts, customer counts, and vehicle driver hours.

R3 recommends the City and SLG incorporate a 10-year depreciation schedule for all new vehicles and containers into future updates to the Rate Setting Manual. Modifying the depreciation schedule for vehicles and containers is a key potential component for the Rate Setting Manual update.

Insurance
SLG’s provided the supporting documentation for the increase in insurance costs, including an email from its insurance company and the respective insurance quote. SLG provided calculations for the insurance increase based on the quote for all their franchise collection areas, and then proportioned the City’s individual cost based on prior percentage allotments. SLG’s calculations follow logical consistency and are accurate based on the quote from the insurance agency.

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Review of Rate Application
City of San Luis Obispo | Base Year Rate Adjustment 5 of 9 Interest
SLG provided the sources and amounts of total company debt, as well as their calculation of interest rates. Using a weighted interest rate and the debt net book value, SLG calculated the associated interest expense for all company operations and then allocated an amount to the City using the percentage of City franchise depreciation (debt) to the company. SLG’s interest calculations for 2022 and 2023 are logically consistent and match the rate application, however R3 notes that SLG used the 2022 Allocation Factor when allocating 2021 interest to the City. The difference in the allocation factor to the City between 2021 and 2022 is 1%, thus the result is immaterial.

Outside Services
The majority of expenses incurred under Outside Services is the organic processing that occurs at the Hitachi Zosen Inova (HZI) Facility; however, this category also includes costs for outsourced repair, disposal of rejected material from HZI, engineering fees, monitoring, and maintenance fees.

SLG projects a 2022 increase of 71.05% from 2021, which amounts to $462,658. This increase is due almost entirely to HZI requesting an increase in its service fee (organics processing fee). SLG reported this increase to be $457,500 in 2022.

SLG provided documentation supporting the increase of $457,500, including a copy of the requesting letter from HZI, excerpts from SLG’s agreement with HZI, and detailed calculations for the total Outside Services expense. SLG was only able to provide a few excerpts from their agreement with HZI due to confidentiality.

These excerpts support HZI’s ability to request an adjustment to their service fee, however HZI’s ability to increase their fee is contingent on SLG receiving a corresponding rate increase from the City.

Furthermore, since the fees being paid to HZI are for organic waste post-processing, an adjustment was made to reclassify HZI expenses as pass-through Tipping Fees, not subject to SLG’s operating margin.

This adjustment removed the full HZI 2022 expense ($1,011,109) from Outside Services and relocated them to Tipping Fees. The Rate Setting Manual defines tipping fees to include “transfer station, transformation facility, and landfill charges”. As Tipping Fees, payments to HZI are considered passthrough costs.

It is standard industry practice for such expenses to be treated as pass-through costs. This adjustment would reduce SLG’s operating profit.

Bad Debt
SLG increased their allowance for bad debt from $3,349 in 2020 to $12,017 in 2021, 2022, and 2023, citing an increase in Bad Debt due to the City pausing enforcement on the property lien process in lieu of COVID-19. However, the City documented that Bad Debt placed on property liens closely hovered around an average of $2,500 in recent years. Thus, Bad Debt was adjusted to $2,500.

This projected Bad Debt is less than 1% of commercial and residential rate revenues, this falls within what we consider to be a reasonable range.

Adjustments
Depreciation: No Adjustment.; Insurance: No Adjustment; Interest: No Adjustment; Outside Services:

Recategorized $1,011,109 in HZI fees as Pass-Through costs (refer to Pass-Through Costs section below); Bad Debt: Reduced by $9,517.

Operating Ratio
The Rate Setting Manual establishes a range of from 90% to 94% for the target operating ratio (profit) used to calculate the Base Year rate adjustment.

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Review of Rate Application
City of San Luis Obispo | Base Year Rate Adjustment 6 of 9 Assessment
SLG’s Rate Application set its 2022 profit level equal to an 93% operating ratio, consistent with the range set forth in the Rate Setting Manual.

Adjustments
The above adjustments reduced SLG’s projected operating profit by $76,821.

Pass-Through Costs (Not Allowable on Profit Ratio)
Tipping Fees
SLG provided supporting documentation, including letters from Cold Canyon signaling the changes in tipping fees.

Assessment
As noted previously, an adjustment to Outside Services expense was made which reclassifies HZI organic processing expenses as tipping fees (pass-through costs). With this adjustment, the $1,011,109 in HZI fees would be added to this Tipping Fees category. This is consistent with the Rate Setting Manual.

Adjustments
Incorporated $1,011,109 in HZI fees as Tipping fees in this category and removed HZI fees from G&A (Outside Services).

Franchise Fees & IWMA Fees
SLG remits to the City a monthly Franchise Fee of 10% of gross revenues. This fee is considered a passthrough cost adjusted each year equal to any rate adjustment.

In addition to franchise fees, SLG also remits an IWMA fee to San Luis Obispo Integrated Waste Management Authority. During review of this Rate Application, and due to shifts in the the Authority’s approach to IWMA fee setting, it was determined that the best course of action was to review IWMA fee revenue and expense from the rate application.

Assessment
SLG projects a 2022 Franchise Fee / IWMA Fee expense increase of approximately 15%. SLG provided supporting documentation for its historical Franchise Fees (matching the City’s record) and IWMA fees.

SLG provided calculations for projected Franchise Fees and IWMA Fees, delineating the two fees individually. The fees are based on the total revenue matching the rate application, and SLG incorporates the revised IWMA fee structure into the projected 2022 values.

R3’s analysis idenfitied a recommended adjustment to the Rate Setting Manual’s franchise fee calculation methodology to match projected revenue more accurately with required revenue. This is described in more detail later in this report.

Adjustments
Decreased IWMA fee expense by $363,770. Decreased Revene Offsets by $191,165.

AB 939 Fees
SLG remits to the City a fixed AB 939 fee every month to support the City’s AB 939 program(s). This fee is considered a pass-through cost adjusted each year equal to any rate adjustment.

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Review of Rate Application
City of San Luis Obispo | Base Year Rate Adjustment 7 of 9 Assessment
SLG provided supporting documentation for its historical and projected AB 939 fees, which matched the City’s records. The City and SLG also agreed to increase the AB 939 fee by an additional $100,000 annually to recover reveues to implement unfunded State mandate SB 1383.

Adjustments
$100,000 City-directed increase to AB 939 Fee.

Lease Payment to Affiliate Companies
SLG reported that it leases the operations center and offices located at Old Santa Fe Road from an affiliated entity, as disclosed in the audited financial statements. Lease payments are adjusted annually by CPI.

Assessment
SLG projects a 2022 increase of 5.30% in Lease Payments, in comparison to 2021, and a 6.78% increase compared to 2020.

Adjustments
No adjustment.

Total Projected Expenses
SLG’s total projected expenses are comprised of Allowable Costs (those from which profit can be generated on), Operating Profit, and Pass-through costs. The sum of these expenses yields the total revenue requirement - the total annual revenue required from rate payers. The total revenue requirement based on the revised Rate Application is $13,983,124, reduced from the original Rate Application of $14,430,723.

Total Projected Revenues
SLG projected a 1.00% increase in total revenues for 2022 as compared the current 2021 projected revenues. The total revenues projected for 2022 are 13.96% higher than 2019 reported revenues.

Assessment
SLG provided actual total revenues for years 2019 and 2020 in support of its projected revenues.

Additionally, SLG projects continued increases in number of accounts serviced, tonnage collected, and revenue. 2020 residential revenue was reported to have increased compared to 2019. We assessed the reasonableness of SLG’s projected residential and commercial revenues and based on this analysis we found SLG’s revenue projections to be reasonable.

Adjustments
No adjustment.

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3. CALCULATION OF THE PERCENT CHANGE

IN RATES
City of San Luis Obispo | Base Year Rate Adjustment 8 of 9 The Rate Setting Manual’s methodology for calculating the total percent change in existing rates should be adjusted when the Rate Setting Manual is revised. The Rate Setting Manual calculates the “Percent Change in Residential and Non-Residential Revenue Requirement” (line 22 of the application) by dividing the net revenue shortfall/surplus by the total rate revenue expected without a Base Year increase.

The Rate Setting Manual then instructs the applicant to further adjust the calculated result, to account for additional franchise fees to be paid on the net revenue shortfall (line 24 of the application).

The following calculations demonstrate the current Rate Setting Manual’s methodology:

A
% Change in Rate Rev. Requirement (Line 22) ൌ ୒ୣ୲ ୗ୦୭୰୲୤ୟ୪୪ ሺୗ୳୰୮୪୳ୱሻ ୘୭୲ୟ୪ ୖୟ୲ୣ ୖୣ୴ୣ୬୳ୣ ୵୧୲୦୭୳୲ ୟ୬ ୅ୢ୨୳ୱ୲୫ୣ୬୲ ∗ 100%
B
% Total Change in Existing Rates (Line 24) ൌ % Change in Rate Rev. Requirement ଵ଴଴%ି୊୰ୟ୬ୡ୦୧ୱୣ ୊ୣୣ % ∗ 100%
The reccomended calculation for future update to the Rate Setting Manual is presented below:
% Change in Existing Rates ൌ Revenue Requirement
Total Rate Revenue without an Adjustment െ 1 ∗ 100%
This change is recommended to be included in updates to the 1994 Rate Setting Manual, which all parties have expressed interest in modifying.

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4. FINDINGS
City of San Luis Obispo | Base Year Rate Adjustment 9 of 9 Revised Rate Adjustment
SLG’s original 2022 Base Year Rate Application calculated a net shortfall in revenues for 2022 of approximately $2,080,000, which equates to a rate increase of 18.71%. The revised increase subsequent to completion of this review is 17.75%. That is based on a revised revenue shortfall of approximately $1,820,700 and is primarily due to the adjustment categorizing the anaerobic digester cost as passthrough tipping fees.

The difference between the adjusted rate adjustment and SLG’s calculated rate adjustment is due to the following:
》 Reduced Bad Debt expense by $9,517 to align with City’s records of average bad debt place on property lien process.
》 Reassigned HZI expenses ($1,011,109) to be pass-through costs, removing them from the “Outside Services” (line 39) expense and adding them into the “Total Tipping Fee” (line 52) expense. The Rate Setting Manual defines tipping fees to include “transfer station, transformation facility, and landfill charges”. As tipping fees, payments to HZI are considered pass-through costs.

This is standard practice in the industry for such expenses to be treated as pass-through costs and additionally, HZI cannot increase SLG’s fees without the City approving and associated rate increase.
》 Reduced operating profit by $76,821 because of the above adjustments. 》 Increased AB 939 fees by $100,000 as a City-directed change to recover reveunes for compliance with SB 1383.
》 Removed IWMA fees from revenues and expenses.

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San Luis Garbage, Co.

Base Year Rate Adjustment Application
Summary
Digester Expense 3.7% IWMA & Franchise Fees 1.6%
Capital Purchases 3.8%Market Rate Wage Adjustment 2.0%
Insurance 1.1% Fuel 0.7%
Commingle Processing Fee -0.7% CPI/Other Operational 5.6%

1. Rate Increase Requested 17.75%
Current Increased Adjustment New
Rate Schedule Rate Rate (a) Rate
Single Family Residential

2. 20 gallon Waste Wheeler $ 11.14 $13.12 $13.12

3. 32 gallon Waste Wheeler $ 17.78 $20.94 $20.94

4. 64 gallon Waste Wheeler $ 35.56 $41.87 $41.87

5. 96 gallon Waste Wheeler $ 53.35 $62.82 $62.82
(a) Calculated rates are rounded up to the nearest $0.01.

6. Multiunit Residential and Non-residential Rate increases of 17.75% will be applied to all rates in each structure
with each rate rounded to the nearest $0.01
Certification
To the best of my knowledge, the data and information in this application is complete, accurate, and consistent with the instructions provided by the Rate Setting Manual.

Name: Jeff Clarin Title: District Manager
Signature: Date: 08/09/21
Fiscal Year: 1-1-2022 to 12-31-2022 Pg. 1 of 6
Summary of Significant Requested Increase Components
Rate Schedule

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San Luis Garbage, Co.

Base Year Rate Adjustment Application
Current
Financial Information Base Year
2019 2020 2021 2022 2023
(from Pg. 4)

6. Direct Labor $3,134,333 $3,027,286 $3,054,099 $3,267,172 $3,343,141

7. Corporate Overhead $215,657 $219,323 $221,077 $232,794 $239,778

8. Office Salaries $345,473 $223,396 $379,893 $412,887 $424,230

9. Other General and Admin Costs $4,723,608 $4,665,589 $4,491,597 $4,483,040 $4,862,523 10 Total Allowable Costs $8,419,071 $8,135,594 $8,146,666 $8,395,893 $8,869,672

11. Operating Ratio 116.2% 108.8% 100.3% 93.0% 93.0%

12. Allowable Operating Profit ($1,366,795) ($711,979) ($24,026) $631,949 $667,610

13. Tipping Fees $2,296,042 $2,339,139 $2,409,313 $3,375,834 $3,390,822

14. Franchise Fees $1,179,293 $1,240,004 $1,338,391 $1,177,209 $1,188,981

15. AB939 Fees $186,065 $203,968 $206,918 $240,832 $248,057

16. Lease Pmts to Affiliated Companies $124,200 $148,444 $150,671 $158,657 $163,416 Transportation to Affiliated Companies $1,952 $9,644 $2,750 $2,750 $2,750

17. Total Pass Through Costs $3,787,552 $3,941,199 $4,108,043 $4,955,282 $4,994,026

18. Revenue Requirement $13,983,124 $14,531,308

19. Total Revenue Offsets $10,839,828 $11,364,814 $12,230,684 $12,162,426 $12,477,419 (from Page 3)

20. Net Shortfall (Surplus) $1,820,698

21. Total Residential and Non-residential Revenue without increase in Base Year (pg.3, lines 32+40) $12,147,084

22. Percent Change in Residential and Non-residential Revenue Requirement 14.99%

23. Franchise Fee Adjustment Factor (1 - 10 percent) 90.00%

24. Percent Change in Existing Rates 16.65%
Additional AB939 Fees for the City of SLO $100,000
City of SLO Revenue $10,126,623
Additional Price Increase 0.99%
Franchise Fee Adjustment Factor (1 - 10 percent) 90.00% Percent Change in Existing Rates 1.10%
Total Percent Change in Existing Rates 17.75%
Fiscal Year: 1-1-2022 to 12-31-2022 Pg. 2 of 6
Section V - Net Shortfall (Surplus)
Historical Projected
Section I-Allowable Costs
Section II-Allowable Operating Profit
Section III-Pass Through Costs
Section IV - Revenue Requirement

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San Luis Garbage, Co.

Base Year Rate Adjustment Application
Revenue Offset Summary
Current
Base Year
2019 2020 2021 2022 2023
Residential Revenue (without increase in Base Yr.)
Current Projected Annualized
Account Type Rate/Mo. Mo.'s Accounts Revenue

25. 20 gallon Waste Wheeler $ 11.14 12 1,662 $ 222,176

26. 32 gallon Waste Wheeler $ 17.78 12 5,448 $ 1,162,385

26.5 64 gallon Waste Wheeler $ 35.56 12 3,948 $ 1,684,691

27. 96 gallon Waste Wheeler $ 53.35 12 1,094 $ 700,379
Adj unincorp/supplemental svcs
12,152

28. Single Family Residential $3,485,712 $3,813,946 $4,182,830 $4,179,625 $4,266,905 Multiunit Residential Dumpster

29. Number of Accounts 297 298 298

30. Revenues $1,263,540 1,471,248.52 $1,440,024 $1,454,424 $1,468,969

31. Less Allowance for Uncollectible Resid Accounts

32. Total Residential Revenue $4,749,252 $5,285,195 $5,622,854 $5,634,050 $5,735,874 Non-residential Revenue (without increase in Base Yr.)
Account Type
Non-residential Can

33. Number of Accounts 369 373 373

34. Revenues $242,173 $256,232 $245,868 $248,325 $250,808 Non-residential Wastewheeler

35. Number of Accounts 383 387 387

36. Revenues $522,159 $552,801 $636,939 $643,308 $649,741 Non-residential Dumpster

37. Number of Accounts - - 1,433 1,447 1,447

38. Revenues $5,293,159 $5,226,825 $5,710,428 $5,621,402 $5,825,209

39. Less: Allowance for Uncollectible Non-resid

40. Total Non-residential Revenue $6,057,491 $6,035,858 $6,593,234 $6,513,034 $6,725,758

45. Interest on Investments $0 $0 $0 $0 $0

46. Other Income $33,086 $43,762 $14,595 $15,342 $15,787

47. Total Revenue Offsets $10,839,828 $11,364,814 $12,230,684 $12,162,426 $12,477,419 Fiscal Year: 1-1-2022 to 12-31-2022 Pg. 3 of 6
Section VII - Revenue Offsets
Historical Projected

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San Luis Garbage, Co.

Base Year Rate Adjustment Application
Cost Summary for Base Year
Description of Cost BASE YEAR BASE YEAR
2019 2020 2021 2022 2023
Labor $2,907,950 $2,813,388 $2,835,660 $3,033,591 $3,102,553 Payroll Taxes $226,383 $213,898 $218,439 $233,581 $240,588

48. Total Direct Labor $3,134,333 $3,027,286 $3,054,099 $3,267,172 $3,343,141

49. Corporate Overhead $291,594 $306,513 $367,318 $386,786 $398,390 Less limitation (enter as negative) ($75,937) ($87,190) ($146,241) ($153,992) ($158,611) Total Corporate Overhead $215,657 $219,323 $221,077 $232,794 $239,778 Office Salaries $321,990 $200,127 $351,383 $382,067 $392,486 Payroll Taxes - Office $23,483 $23,269 $28,510 $30,820 $31,744

50. Total Office Salaries $345,473 $223,396 $379,893 $412,887 $424,230 Bad Debt $529 $3,349 $12,017 $2,500 $2,500
Allocated expenses $0 $0 $0 $0 $0
Bonds expense $5,324 $4,325 $3,600 $3,791 $3,905
Depreciation $845,345 $1,087,445 $877,346 $1,219,062 $1,479,472 Drive Cam fees $29,055 $15,886 $17,614 $18,548 $19,104
Dues and Subscriptions $11,684 $2,905 $10,006 $10,537 $10,853 Facilities $30,610 $21,456 $14,637 $15,413 $15,875
Gas and oil $825,923 $774,199 $821,852 $825,994 $850,158 Insurance $1,122,107 $857,364 $994,256 $1,103,434 $1,136,537 Interest Expense $190,215 $285,527 $131,205 $172,637 $200,185 Laundry (Uniforms) $33,514 $24,183 $25,163 $26,497 $27,291 Legal and Accounting $33,575 $23,213 $25,705 $26,998 $27,768 Miscellaneous and Other $26,610 $2,656 $2,577 $2,713 $2,795 Office Expense $189,252 $140,845 $145,129 $152,844 $157,442 Operating Supplies $58,287 $68,727 $63,196 $66,545 $68,542 Other Taxes $36,778 $36,995 $31,476 $33,145 $34,139
Outside Services $619,299 $657,187 $651,191 $102,740 $105,822 Public Relations and Promotion $8,817 $4,305 $3,827 $3,834 $3,839 Permits $58,311 $82,759 $79,007 $83,194 $85,690
Postage $22,826 $4,384 $6,571 $6,920 $7,127
Relocation $17,372 $15,396 $12,898 $12,898 $12,898
Rent $0 $0 $1,315 $2,054 $2,116
Telephone $37,709 $20,752 $20,233 $21,305 $21,944
Tires $97,837 $104,931 $123,170 $129,698 $133,589
Travel $26,242 $4,509 $6,228 $6,558 $6,755
Truck Repairs $380,228 $404,552 $394,966 $415,899 $428,376 Utilities $16,159 $17,739 $16,412 $17,282 $17,801

51. Total Other Gen/Admin Costs $4,723,608 $4,665,589 $4,491,597 $4,483,040 $4,862,523

52. Total Tipping Fees $2,296,042 $2,339,139 $2,409,313 $3,375,834 $3,390,822

53. Total Franchise Fee $1,179,293 $1,240,004 $1,338,391 $1,177,209 $1,188,981

54. Total AB 939/Regulatory Fees $186,065 $203,968 $206,918 $240,832 $248,057

55. Total Lease Pmt to Affil Co.'s $124,200 $148,444 $150,671 $158,657 $163,416 56 Total Transportation to Affil Co.'s $1,952 $9,644 $2,750 $2,750 $2,750 57 Total Cost $12,206,623 $12,076,793 $12,254,709 $13,351,175 $13,863,698 Fiscal Year: 1-1-2022 to 12-31-2022 Pg. 4 of 6

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San Luis Garbage, Co.

Base Year Rate Adjustment Application
Base Year Revenue Offset Summary For Information Purposes Only Description of Revenue Overall Franchise Non-franchise
Total Total SLO City SLO County CMC/Cal Poly
Residential Revenue
(without increase in Base Year)

57. Single Family Residential $4,179,625 $4,179,625 $3,768,364 $411,261 $0 Multiunit Residential Dumpster (Considered Non-residential revenue)

58. Number of Accounts 298 298 298 - -

59. Revenues $1,454,424 $1,454,424 $1,454,424 $0 $0

60. Less Allowance for Uncollectable $0 $0 $0 $0 $0

61. Total Residential Revenue $5,634,050 $5,634,050 $5,222,789 $411,261 $0 Non-residential Revenue (without increase in Base Year) Account Type
Non-residential Can

62. Number of Accounts 373 372 368 4 1

63. Revenues $248,325 $248,151 $246,693 $1,458 $174
Non-residential Wastewheeler

64. Number of Accounts 387 384 359 25 3

65. Revenues $643,308 $640,433 $621,301 $19,132 $2,875
Non-residential Dumpster

66. Number of Accounts 1,447 1,339 1,094 245 108

67. Revenues $5,621,402 $4,998,229 $4,035,840 $962,389 $623,172

68. Less: Allowance for Uncollectible
Non-residential Accounts $0 $0 $0 $0 $0

69. Total Non-residential Revenue $6,513,034 $5,886,813 $4,903,834 $982,979 $626,221

74. Interest on Investments $0 $0 $0 $0 $0

75. Other Income $15,342 $15,342 $13,497 $1,845 $0

76. Total Revenue Offsets $12,162,426 $11,536,205 $10,140,121 $1,396,084 $626,221 Fiscal Year: 1-1-2022 to 12-31-2022 Pg. 5 of 6
Section VII-Revenue Offsets
Refuse Collection

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San Luis Garbage, Co.

Base Year Rate Adjustment Application
Operating Information
Percent Percent Percent Base Year Percent
2019 Change 2020 Change 2021 Change 2022 Change 2023
Residential Garbage

77. Accounts 12,123 1.2% 12,263 1.3% 12,417 1.0% 12,541 1.0% 12,667

78. Routes 5 7.2% 6 -10.8% 5 0.0% 5 0.0% 5

79. Tons Collected 7,050 -5.5% 6,661 3.0% 6,861 3.0% 7,067 1.0% 7,137

80. Direct Labor Hours 10,881 7.2% 11,660 -10.8% 10,397 0.0% 10,397 0.0% 10,397 Non-residential Garbage

80. Accounts 2,341 -1.0% 2,318 0.3% 2,325 1.0% 2,348 1.0% 2,372

81. Routes 11 7.2% 12 -10.8% 11 0.0% 11 0.0% 11
Tons Collected 29,419 -5.5% 27,795 3.0% 28,629 3.0% 29,488 1.0% 29,783

82. Direct Labor Hours 23,436 7.2% 25,113 -10.8% 22,394 0.0% 22,394 0.0% 22,394 Recyclable Materials - Commingled Recycling

83. Accounts 14,464 0.8% 14,581 1.1% 14,742 1.0% 14,889 1.0% 15,038 Routes 10 7.2% 10 -10.8% 9 0.0% 9 0.0% 9
Tons Collected 10,731 -10.1% 9,650 3.0% 9,940 3.0% 10,238 1.0% 10,341

84. Direct Labor Hours 19,798 7.2% 21,215 -10.8% 18,918 0.0% 18,918 0.0% 18,918 Recyclable Materials - Greenwaste Collection
85 Accounts 12,123 1.2% 12,263 1.3% 12,417 1.0% 12,541 1.0% 12,667 Routes 3 7.2% 3 -10.8% 3 0.0% 3 0.0% 3
Tons Collected 7,319 -4.8% 6,970 3.0% 7,179 3.0% 7,394 1.0% 7,468 Direct Labor Hours 6,622 7.2% 7,096 -10.8% 6,327 0.0% 6,327 0.0% 6,327 Fiscal Year: 1-1-2022 to 12-31-2022 Pg. 6 of 6
Historical Current Projected
Section IX-Operating Data

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San Luis Garbage Company
Financial Statements
Years Ended December 31, 2020 and 2019

Page 1071 of 1208 ends

C O N T E N T S
Page(s)
Independent Auditors’ Report 1 - 2
Financial Statements
Statements of revenues and expenses - regulatory basis 3 Notes to financial statements 4 - 11
Independent Auditors’ Report on Supplementary Information 12 Schedules of allowable costs - regulatory basis 13 - 14

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CALIBER

AUDIT & ATTEST, LLP
Independent Auditors' Report
To Management of San Luis Garbage Company
San Luis Obispo, California
We have audited the accompanying financial statements of San Luis Garbage Company, which comprise the statements of revenues and expenses - regulatory basis for the years ended December 31, 2020 and 2019, and the related notes to the financial statements.

Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with the financial reporting provisions of the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility
Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
-1-
805 Aerovista P1, Ste 103, San Luis Obispo, CA 93401 Phone: (805) 888-0200 Fax: (805) 888-0201

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CALIBER

AUDIT & ATTEST, LLP
Independent Auditors' Report -Continued
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the results of the operations of San Luis Garbage Company for the years ended December 31, 2020 and 2019, in accordance with the financial reporting provisions of the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo as described in Note 1.

Basis ofAccounting
We draw attention to Note 1 of the financial statements, which describes the basis of accounting. The financial statements are prepared on the basis of the financial reporting provisions prescribed or permitted by the City and County of San Luis Obispo, which is a basis of accounting other than accounting principles generally accepted in the United States of America, to comply with the requirements of the City and County of San Luis Obispo. Our opinion is not modified with respect to that matter.

Restriction on Use
This report is intended solely for the information and use of the management of San Luis Garbage Company and the City and County of San Luis Obispo and is not intended to be and should not be used by anyone other than these specified parties.
rY 7HC44 _P
San Luis Obispo, California
March 19, 2021
-2-
805 Aerovista P1, Ste 103, San Luis Obispo, CA 93401 Phone: (805) 888-0200 Fax: (805) 888-0201

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- 3 -
2020 2019
Revenues
Hauling revenue 11,321,053 $ 10,806,742 $
Other income 43,762 33,086
Total revenue 11,364,815 10,839,828
Allowable Costs
Direct labor 3,027,286 3,134,333
Corporate overhead 219,323 215,657
Office salaries 223,396 345,473
Other general and administrative costs 4,380,062 4,533,393 Total allowable costs 7,850,067 8,228,856
Allowable Pass-Through Costs
Tipping fees, related party 2,339,139 2,296,042
Franchise fees and taxes 1,443,972 1,365,358
Related party rent 148,444 124,200
Interest, related party 285,527 190,215
Transportation - compactors, related parties 9,644 1,952 Total pass-through costs 4,226,726 3,977,767
Total allowable and pass-through costs 12,076,793 12,206,623 Loss before non-allowable costs (711,978) (1,366,795)
Non-Allowable Costs
Charitable and political contributions 324 726
Corporate overhead 87,190 75,937
Entertainment 2,008 17,346
Gain on disposal of assets (15,533) (43,386)
Penalties 14 -
Total non-allowable costs 74,003 50,623
Net loss (785,981) $ (1,417,418) $
See Notes to Financial Statements.

San Luis Garbage Company
Statements of Revenues and Expenses - Regulatory Basis
Years Ended December 31, 2020 and 2019

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San Luis Garbage Company
Notes to Financial Statements
- 4 -
Note 1. Summary of Significant Accounting Policies
Nature of business:

San Luis Garbage Company (the Company) became a wholly-owned subsidiary of Waste Connections US, Inc. as of April 1, 2002. The Company operates a garbage collection service for residential, commercial, and governmental entities within the city and vicinity of San Luis Obispo, California. The Company services collection routes by use of Companyowned equipment and employees of the Company. The Company extends credit in the form of accounts receivable to customers in its service area.

Prescribed accounting practices:

The County of San Luis Obispo and the City of San Luis Obispo require the Company to utilize the accounting principles prescribed by the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo (the Manual) in its financial statement reporting for rate setting purposes.

The primary purpose of the accounting principles prescribed by the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo is to determine integrated solid waste management rates which are fair to residents and which provide adequate revenue to the hauler. The basis of presentation prescribed by the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo differs from U.S. generally accepted accounting principles (U.S. GAAP) in that the following expenses are non-allowable costs:
charitable donations and political contributions, entertainment expenses, income tax expenses, and profit sharing payments not related to an Internal Revenue Service approved pension program. The Manual also specifies a limitation on corporate overhead, which is defined as salaries of corporate officers that can be treated as allowable costs. Bonus costs and allocated facilities costs are included as allowable costs and are not part of the corporate overhead pool subject to limitation. Although not specifically listed as nonallowable costs in the Manual, management has also historically classified the following costs as non-allowable: loss (or gain) on disposal of assets, penalties, and certain employee relocation costs.

In addition, according to the accounting principles prescribed by the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management, the operations of the individual garbage districts are considered separate entities for rate setting purposes. Given this, the financial statements for each company have not been consolidated with the other subsidiaries of Waste Connections US, Inc., as would have been specified by U.S. generally accepted accounting principles.

Change in accounting policies:

In 2020, management of the Company changed the accounting policy for the allocation of general and administrative costs. Historically, the general and administrative costs were specifically tracked by Company rather than through allocations. Management of the

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San Luis Garbage Company
Notes to Financial Statements
- 5 -
Company believes that because these costs are shared, allocating these costs between the companies receiving the benefits through charges and credits to intercompany receivable and payable accounts is the most effective way to track and record the costs at the standalone district (Company) level. These costs are allocated based on truck hours or customer count, depending on the nature of the cost. Costs that are administrative are allocated on customer count, and costs that are direct are allocated on truck hours, consistent with the direct labor (direct) and office salaries (administrative) allocations. The change in accounting policy has been applied prospectively beginning in 2020.

Interest:

Interest expense is allocated using an estimated internal interest rate and applying that interest rate to the average net book value of fixed assets at the stand-alone district level.

The Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo includes interest expense as an allowable cost.

Income tax:

As noted above, income tax expense is a non-allowable cost resulting in a difference between the presentation of the Company’s statements of revenue and expenses – regulatory basis under the principles prescribed by the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo and U.S. generally accepted accounting principles. The income tax expense, which would be reported in the non-allowable costs portion of these financial statements, does not present, in accordance with U.S. generally accepted accounting principles, a provision for current or deferred income taxes of the Company or any allocation of income tax expense from its parent, Waste Connections US, Inc.

Franchise fees and taxes:

U.S. generally accepted accounting principles would require that tax and franchise fees that are assessed by governmental authorities that are directly imposed on a revenue-producing transaction between a seller and a customer be presented on a net basis (excluded from revenues). However, in accordance with the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo, franchise fees and taxes have been shown gross on the statements of revenues and expenses – regulatory basis and are included in revenues and shown as an allowable cost.

Use of estimates:

The preparation of financial statements in conformity with practices prescribed or permitted by the Rate Setting Process and Methodology Manual for Integrated Solid Waste Management Rates of the City of San Luis Obispo, which is a comprehensive basis of accounting other than U.S. generally accepted accounting principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and

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San Luis Garbage Company
Notes to Financial Statements
- 6 -
the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue recognition:

Revenues are recognized when services are transferred to customers in an amount that reflects consideration that is expected to be received.

Nature of revenue:

The Company’s solid waste collection business involves the collection of waste from residential, commercial and industrial customers for transport directly to the landfill, transfer stations or recycling centers. Solid waste collection services include both recurring and temporary customer relationships. The services are performed under service agreements or franchise agreements with governmental entities. Residential and commercial collection services are provided on a subscription basis with individual households or businesses. The fees received for collection services are based primarily on the market, collection frequency, level of service, route density, type and volume or weight of the waste collected, type of equipment and containers furnished, the distance to the disposal or processing facility, the cost of disposal or processing, and prices charged by competitors for similar services.

Disaggregation of revenue:

The following table presents the Company’s revenue disaggregated by contract type:
2020 2019
Hauling revenues - residential customers 3,813,946 $ 3,485,712 $ Hauling revenues - commercial customers 7,507,107 7,321,030 Total 11,321,053 $ 10,806,742 $
The factors that impact the timing and amount of revenue recognized for each type of revenue may vary based on the nature of the service performed. Generally, the Company recognizes revenue at the time it performs a service. Certain customers are billed in advance (bi-monthly billing) and, accordingly, recognition of the related revenues is deferred until the services are provided.

Contract balances:

The timing of revenue recognition, billings and cash collections results in billed accounts receivable (contract assets), and customer deposits and deferred revenue (contract liabilities) on the Company’s balance sheet.

Performance obligations:

Service performance obligations of a long-term nature, such as solid waste collection service contracts, are satisfied over time, and revenue is recognized based on the value

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San Luis Garbage Company
Notes to Financial Statements
- 7 -
provided to the customer during the period. The amount billed to the customer is based on variable elements such as the number of residential homes or businesses for which collection services are provided, the volume of waste collected, transported and disposed, and the nature of the waste accepted. The Company does not disclose the value of unsatisfied performance obligations for these contracts as its right to consideration corresponds directly to the value provided to the customer for services completed to date and all future variable consideration is allocated to wholly unsatisfied performance obligations.

Costs to obtain a contract:

The incremental direct costs of obtaining a contract, which consist of sales incentives, would be recognized on the Company’s balance sheet as a deferred sales incentive to be amortized to expense over the life of the customer relationship. There were no contract acquisition costs recorded at the stand-alone district level.

Accounts receivable:

Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company estimates its allowance for doubtful accounts based on historical collection trends, types of customers, the age of the outstanding receivables, and existing economic conditions. Management provides for probable uncollectible amounts through a charge to earnings and a credit to a valuation allowance based on its assessment of the current status of individual accounts. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. Changes in the valuation allowance have not been material to the financial statements.

Property and equipment:

Repairs, maintenance and small equipment purchases are charged to expense when incurred. Expenditures, which significantly increase asset values or extend useful lives, are capitalized and recorded at cost. Depreciation expense is calculated on the straight-line method over the following useful lives:

Years
Buildings and improvements 25
Vehicles 7
Containers 7
Equipment 7
Office equipment 5

Page 1079 of 1208 ends

San Luis Garbage Company
Notes to Financial Statements
- 8 -
Depreciation expense for the years ended December 31, 2020 and 2019 was $1,087,445 and $845,345, respectively.

Advertising costs:

The Company expenses advertising costs as incurred.

Insurance:

Waste Connections US, Inc., the sole shareholder and parent of the Company is effectively self-insured for automobile liability, general liability, employer’s liability, environmental liability, as well as for certain employee group health claims, property and workers’ compensation. Waste Connection’s insurance accruals are based on claims filed and estimates of claims incurred but not reported and are developed by corporate management with assistance from its third-party actuary and its third-party claims administrator. The insurance accruals are influenced by past claims experience factors, which have a limited history, and by published industry development factors. Insurance expense and allocated insurance expense for the Company are recorded in other general and administrative costs on the statements of revenues and expenses – regulatory basis.

Economic dependency:

The Company provides disposal services to residential and commercial customers under the terms of franchise agreements with the City of San Luis Obispo and the County of San Luis Obispo. Collection rates are determined annually based on historical expenses, future budgeted expenses, and a reasonable rate of return.

On January 1, 2019, an anaerobic digester came on line in San Luis Obispo, which triggered a technology-related extension of the Company’s franchise agreements with the City of San Luis Obispo and County of San Luis Obispo until December 31, 2039, which is 20 years past the Facility Operation Date.

In consideration for the grant of the exclusive franchise to provide services to the respective municipalities, the Company has agreed to pay a franchise fee based upon a percentage of annual gross solid waste revenues provided to each grantee, as follows:

City of San Luis Obispo 10%
County of San Luis Obispo
(unincorporated) 10%
The Company is required to submit audited financial statements to the City of San Luis Obispo within four months of their year-end and to the County of San Luis Obispo within six months of their year-end. The contracts allow for an extension of time if mutually agreed upon by both parties.

Page 1080 of 1208 ends

San Luis Garbage Company
Notes to Financial Statements
- 9 -
Related party rent:

The Company accounts for intercompany leases as related party rent expense and has not adopted the new U.S. GAAP lease guidance because the intercompany leases eliminate on a consolidated level for Waste Connections US, Inc.

COVID-19 impact:

The COVID-19 coronavirus outbreak in the United States and related shelter in place directives resulted in operational challenges for many of the Company’s customers and certain industries. Garbage collection services remain an essential service, although there was impact to the Company’s commercial customers. Management will be closely monitoring the results and will take actions necessary to, as much as possible, mitigate the impact on the Company’s operations.

Note 2. Related Party Transactions
The Company has entered into various related party transactions. The nature of related party transactions and amounts not specifically identified elsewhere in the financial statements are as follows:

Overhead:

San Luis Garbage Company is a wholly-owned subsidiary of Waste Connections US, Inc.

Waste Connections US, Inc. provides management and administrative services to San Luis Garbage Company. These costs are included as corporate overhead allowable and nonallowable in the accompanying statements of revenues and expenses - regulatory basis.

Tipping fees:

Waste Connections US, Inc. is also the sole shareholder in Cold Canyon Land Fill, Inc., which operates the sanitary landfill that the Company utilizes for the disposal of garbage collected, and the Materials Recovery Facility (MRF) for the disposal of recyclable material. These costs are included in tipping fees, related party in the accompanying statement of revenues and expenses – regulatory basis.

Transportation:

The Company also pays other related companies for transportation costs of garbage to the landfill. The transportation costs – compactors, related parties are included in the accompanying statement of revenues and expenses – regulatory basis.

Allocated insurance:

The Company incurs expenses for insurance costs that are allocated from a related party company that is a subsidiary of Waste Connections US, Inc. The amount of the insurance cost allocated totaled $857,364 and $1,122,107 for the years ended December 31, 2020 and 2019, respectively, which is included in other general and administrative costs.

Page 1081 of 1208 ends

San Luis Garbage Company
Notes to Financial Statements
- 10 -
Allocated facilities:

The Company incurs expenses for regional facilities costs that are allocated from the regional division of Waste Connections US, Inc. The amount of the facilities cost allocated totaled $21,456 and $30,610 for the years ended December 31, 2020 and 2019, respectively, which is included in other general and administrative costs.

Allocated labor:

The related companies pay for labor and services on behalf of each other. These costs are allocated between the companies receiving the benefits through charges and credits to intercompany receivable and payable accounts based upon the actual costs incurred. The allocated labor costs are recorded to direct labor or office salaries. Direct labor costs are allocated to the companies based on truck hours. Office salaries are allocated to the companies based on customer count.

Allocated other general and administrative costs:

The Company incurs other general and administrative costs that are shared between the related companies. These costs are allocated between the companies receiving the benefits through charges and credits to intercompany receivable and payable accounts. Previous to 2020, the general and administrative costs were specifically tracked by company, rather than allocation. Starting in 2020, these costs are allocated based on truck hours or customer count, depending on the nature of the cost. Costs that are administrative are allocated on customer count, and costs that are direct are allocated on truck hours, consistent with the direct labor (direct) and office salaries (administrative) allocations.

Allocated bonuses:

Bonus costs to the local level employees allocated from corporate are included in direct labor and office salaries.

Allocated interest:

Interest expense is allocated to the stand-alone district level based on the policy as described in Note 1, and is shown as interest, related party.

Note 3. Employee Benefit Plan
The Company’s employees can participate in the 401(k) profit sharing plan (the Plan) offered by Waste Connections US, Inc. Waste Connections US, Inc. made matching contributions to a trust, for the benefit of qualified employees, subject to certain limitations imposed by the Internal Revenue Service for the years ended December 31, 2020 and 2019.

Effective January 1, 2019, the Company matches 100% of employee contributions up to 5% of compensation and the match vests immediately. Substantially all employees are eligible who are 21 years of age and have at least one year of service. As of June 1, 2020, the employer match was suspended in response to the impact of COVID-19. The match will resume on January 1, 2021. For the years ended December 31, 2020 and 2019, the Company’s contribution amounted to $39,237 and $106,641, respectively.SL The total

Page 1082 of 1208 ends

San Luis Garbage Company
Notes to Financial Statements
- 11 -
amount of the retirement costs are recorded in the financial statements as part of direct labor and office salaries.

Note 4. Related Party Lease
The Company has a lease for office and yard space with a related party, Corral de Piedra Land Company. The lease is renewed annually. The base rent is allocated to the stand-alone districts. The monthly base rent for the Company’s yard and office space for the years ended December 31, 2020 and 2019 was $12,370 and $10,350, respectively. The base rent is subject to an annual increase based on the Consumer Price Index (CPI), and is also subject to allocation adjustments. Related party rent expense for the years ended December 31, 2020 and 2019 was $148,444 and $124,200, respectively.

Note 5. Commitments and Contingencies
The Company has a workers’ compensation claim outstanding at the end of the year. The ultimate responsibility for these claims is held by Waste Connections US, Inc., the sole shareholder and parent of the Company. The liability and expense is allocated from the corporate consolidated level to a related entity, Corral de Piedra, which serves as the Company’s insurance manager and whose sole shareholder is also Waste Connections US, Inc. Management does not anticipate any amount related to these claims becoming a liability of the Company on a stand-alone basis. As such, the liability and expense for these claims has not been recorded to the financial statements of the Company.

Note 6. Subsequent Events
The date to which events occurring after December 31, 2020 have been evaluated for possible adjustment to the financial statements or disclosure is March 19, 2021, which is the date on which the financial statements were available to be issued.

Page 1083 of 1208 ends

CALIBER

AUDIT & ATTEST, LLP
Independent Auditors' Report on Supplementary Information To Management of San Luis Garbage Company
San Luis Obispo, California
We have audited the financial statements of San Luis Garbage Company for the years ended December 31, 2020 and 2019, and our report thereon dated March 19, 2021, which expressed an unmodified opinion on those statements, appears on page one. Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The schedules of allowable costs — regulatory basis are presented for purposes of additional analysis and are not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements.

The information has been subjected to the auditing procedures applied in the audits of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

San Luis Obispo, California
March 19, 2021
LLP
- 12 -
805 Aerovista P1, Ste 103, San Luis Obispo, CA 93401 Phone: (805) 888-0200 Fax: (805) 888-0201

Page 1084 of 1208 ends

- 13 -
2020 2019
Direct Labor
Labor 2,813,388 $ 2,907,950 $
Payroll taxes 213,898 226,383
Total direct labor 3,027,286 $ 3,134,333 $
Corporate Overhead
Allowable 219,323 $ 215,657 $
Non-allowable 87,190 75,937
Total corporate overhead 306,513 $ 291,594 $
Office Salaries
Office salaries 200,127 $ 321,990 $
Payroll taxes 23,269 23,483
Total office salaries 223,396 $ 345,473 $
San Luis Garbage Company
Schedules of Allowable Costs - Regulatory Basis
Years Ended December 31, 2020 and 2019

Page 1085 of 1208 ends

- 14 -
2020 2019
Other General and Administrative Costs
Bad debt 3,349 $ 529 $
Bond 4,325 5,324
Depreciation 1,087,445 845,345
Drive cam fees 15,886 29,055
Dues and subscriptions 2,905 11,684
Facilities - allocated expenses from related parties 21,456 30,610 Gas and oil 774,199 825,923
Insurance - allocated expenses from related parties 857,364 1,122,107 Laundry and uniforms 24,183 33,514
Legal and accounting 23,213 33,575
Miscellaneous and other 2,656 26,610
Office 140,845 189,252
Operating supplies 68,727 58,287
Other taxes 36,995 36,778
Outside services 136,553 99,023
Non-related party tipping fees 520,634 520,276
Permits and licenses 82,759 58,311
Postage 4,384 22,826
Public relations and promotions 4,305 8,817
Relocation 15,396 17,372
Telephone 20,752 37,709
Tires 104,931 97,837
Travel 4,509 26,242
Truck repairs 404,552 380,228
Utilities 17,739 16,159
Total other general and administrative costs 4,380,062 $ 4,533,393 $ San Luis Garbage Company
Schedules of Allowable Costs - Regulatory Basis - Continued Years Ended December 31, 2020 and 2019

Page 1086 of 1208 ends

City of San Luis Obispo
Current Rates
Service Description Line of Business Current

RESIDENTIAL
Residential MSW
19 WW /CURB RESIDENTIAL MSW $ 11.14
19WW/YARD/HRDSHP RESIDENTIAL MSW $ 11.14
20 WW YARD HARDSHIP RESIDENTIAL MSW $ 11.14
32 GAL ADDITIONAL RESIDENTIAL MSW $ 16.21
32 WW /CURB RESIDENTIAL MSW $ 17.78
32 WW HDCP / IN YD RESIDENTIAL MSW $ 13.33
32WW LOW INCOME RESIDENTIAL MSW $ 13.33
32WW/YARD/HRDSHP RESIDENTIAL MSW $ 17.78
64 IN YARD TRASH WHEELED RESIDENTIAL MSW $ 47.69
64 WW /CURB RESIDENTIAL MSW $ 35.56
64GAL ADDITIONAL RESIDENTIAL MSW $ 32.45
64WW/YARD/HRDSHP RESIDENTIAL MSW $ 35.56
96 IN YARD TRASH WHEELED RESIDENTIAL MSW $ 65.46
96 WW /CURB RESIDENTIAL MSW $ 53.35
96GAL ADDITIONAL RESIDENTIAL MSW $ 48.64
96WW/YARD/HRDSHP RESIDENTIAL MSW $ 53.35
DESIGNED MANUAL SERVICE RESIDENTIAL MSW $ 18.09
DESIGNED MANUAL SERVICE RESIDENTIAL MSW $ 18.09
DESIGNED MANUAL SERVICE RESIDENTIAL MSW $ 28.94
DESIGNED MANUAL SERVICE RESIDENTIAL MSW $ 57.92
DESIGNED MANUAL SERVICE RESIDENTIAL MSW $ 86.83
RESIDENTIAL 20 GALLON RESIDENTIAL MSW $ 11.14
SLO CO WASTE MGMT AUTH RESIDENTIAL MSW $ 0.30
SPECIAL TRIP FEE RESIDENTIAL MSW $ 26.91
VACANT RATE RESIDENTIAL MSW $ 9.14
VACATION RESIDENTIAL MSW $ 9.14
CITY CLEAN UP RESIDENTIAL MSW $ 6.14
RESIDENTIAL EXTRAS RESIDENTIAL MSW $ 4.45
XTRA 32GAL GREEN WASTE RESIDENTIAL MSW $ 3.46
RESTART FEE-RESIDENTIAL RESIDENTIAL MSW $ 13.45
SMALL EXTRA RESIDENTIAL MSW $ 9.94
RESI TRIP CHARGE RESIDENTIAL MSW $ 8.97
20 GL IN YARD RESIDENTIAL MSW $ 23.26
32 IN YARD TRASH WHEELED RESIDENTIAL MSW $ 29.91
Residential Recycle
32 RECYCLE/IN YARD RESI RECYCLING $ 12.12
64 RECYCLE/IN YARD RESI RECYCLING $ 12.12
96 RECYCLE/IN YARD RESI RECYCLING $ 12.12
XTRA 32GAL RECYCLE RESI RECYCLING $ 0.94
XTRA 64GAL RECYCLE RESI RECYCLING $ 0.94
XTRA 96GAL RECYCLE RESI RECYCLING $ 0.94
EXTRA RECYCLE RESI RECYCLING $ 2.23
Residential Green Waste
32 GREEN WASTE/IN YARD RESIDENTIAL GW $ 12.12
RATES

Page 1 of 5 ends

96 GREEN WASTE/IN YARD RESIDENTIAL GW $ 12.12
COMM GW 96GAL 2X WKLY RESIDENTIAL GW $ 11.27
XTRA 32GAL GREEN WASTE RESIDENTIAL GW $ 3.48
XTRA 96GAL GREEN WASTE RESIDENTIAL GW $ 3.48

ORGANICS
Organics
32 GAL 3X WKLY ORGANICS ORGANICS $ 16.94
64 GAL 3X WKLY ORGANICS ORGANICS $ 23.99
XTRA 32 GAL ORGANICS ORGANICS $ 1.88
XTRA 64 GAL ORGANICS ORGANICS $ 1.88

COMMERCIAL
Commercial MSW
1 CAN 1X WEEKLY COMMERCIAL MSW $ 31.63
1 CAN 2X WEEKLY COMMERCIAL MSW $ 49.64
1 CAN 3X WEEKLY COMMERCIAL MSW $ 67.76
1 CAN 4X WEEKLY COMMERCIAL MSW $ 85.78
1 CAN 5X WEEKLY COMMERCIAL MSW $ 103.82
1 CAN 7X WEEKLY COMMERCIAL MSW $ 139.91

1.5YD 1X WEEKLY COMMERCIAL MSW $ 126.45

1.5YD 2X WEEKLY COMMERCIAL MSW $ 185.13

1.5YD 3X WEEKLY COMMERCIAL MSW $ 243.81

1.5YD 5X WEEKLY COMMERCIAL MSW $ 361.23

1.5YD 6X WEEKLY COMMERCIAL MSW $ 419.96

1.5YD 7X WEEKLY COMMERCIAL MSW $ 478.66

1.5YD APT 1X WKLY COMMERCIAL MSW $ 149.02

1.5YD APT 2X WKLY COMMERCIAL MSW $ 230.29

1.5YD APT 3X WKLY COMMERCIAL MSW $ 311.60

1.5YD APT 4X WKLY COMMERCIAL MSW $ 392.86

1.5YD APT 6X WKLY COMMERCIAL MSW $ 555.40
1YD 1X WEEKLY COMMERCIAL MSW $ 112.89
1YD 2X WEEKLY COMMERCIAL MSW $ 158.04
1YD 3X WEEKLY COMMERCIAL MSW $ 203.22
1YD 4X WEEKLY COMMERCIAL MSW $ 248.37
1YD 7X WEEKLY COMMERCIAL MSW $ 383.85
1YD APARTMENT COMMERCIAL MSW $ 128.71
1YD APT 2X WKLY COMMERCIAL MSW $ 187.46
2 96GAL 1X WEEKLY COMMERCIAL MSW $ 92.39
2 96GAL 2X WEEKLY COMMERCIAL MSW $ 142.02
2 96GAL 3X WEEKLY COMMERCIAL MSW $ 191.70
2 96GAL 4X WEEKLY COMMERCIAL MSW $ 241.34
2 96GAL 6X WEEKLY COMMERCIAL MSW $ 340.65
2 96GAL 7X WEEKLY COMMERCIAL MSW $ 390.39
2 CANS 1X WEEKLY COMMERCIAL MSW $ 40.64
2 CANS 2X WEEKLY COMMERCIAL MSW $ 63.25
2 CANS 3X WEEKLY COMMERCIAL MSW $ 85.80
2 CANS 5X WEEKLY COMMERCIAL MSW $ 131.00
2 CANS 6X WEEKLY COMMERCIAL MSW $ 153.56
2 CANS 7X WEEKLY COMMERCIAL MSW $ 176.13
2 YD 7X WEEKLY COMMERCIAL MSW $ 778.89
2YD 1X WEEKLY COMMERCIAL MSW $ 139.98
2YD 2X WEEKLY COMMERCIAL MSW $ 209.97
2YD 3X WEEKLY COMMERCIAL MSW $ 280.02
2YD 4X WEEKLY COMMERCIAL MSW $ 349.98
2YD 6X WEEKLY COMMERCIAL MSW $ 489.99
2YD 7X WEEKLY COMMERCIAL MSW $ 559.98
2YD APARTMENT 1X WK COMMERCIAL MSW $ 169.33
2YD APT 2X WKLY COMMERCIAL MSW $ 270.95

Page 2 of 5 ends

2YD APT 3X WKLY COMMERCIAL MSW $ 372.53
2YD APT 4X WKLY COMMERCIAL MSW $ 474.13
3 96GAL 1X WEEKLY COMMERCIAL MSW $ 128.41
3 96GAL 2X WEEKLY COMMERCIAL MSW $ 193.87
3 96GAL 5X WEEKLY COMMERCIAL MSW $ 390.31
3 CANS 1X WEEKLY COMMERCIAL MSW $ 49.67
3 CANS 5X WEEKLY COMMERCIAL MSW $ 158.11
3 CANS 6X WEEKLY COMMERCIAL MSW $ 185.21
3 CANS 7X WEEKLY COMMERCIAL MSW $ 212.34
3YD 1X WEEKLY COMMERCIAL MSW $ 167.08
3YD 2X WEEKLY COMMERCIAL MSW $ 264.14
3YD 3X WEEKLY COMMERCIAL MSW $ 361.23
3YD 4X WEEKLY COMMERCIAL MSW $ 458.33
3YD 5X WEEKLY COMMERCIAL MSW $ 555.40
3YD 6X WEEKLY COMMERCIAL MSW $ 652.50
3YD 7X WEEKLY COMMERCIAL MSW $ 749.62
3YD APARTMENT COMMERCIAL MSW $ 209.95
3YD APT 2X WKLY COMMERCIAL MSW $ 352.23
3YD APT 3X WKLY COMMERCIAL MSW $ 494.46
3YD APT 4X WKLY COMMERCIAL MSW $ 636.73
3YD APT 6X WKLY COMMERCIAL MSW $ 921.21
3YD APT 7X WKLY COMMERCIAL MSW $ 1,063.46
4 96GAL 1X WEEKLY COMMERCIAL MSW $ 164.41
4 96GAL 2X WEEKLY COMMERCIAL MSW $ 245.70
4 96GAL 3X WEEKLY COMMERCIAL MSW $ 327.72
4 96GAL 5X WEEKLY COMMERCIAL MSW $ 489.55
4 CANS 2X WEEKLY COMMERCIAL MSW $ 90.35
4 CANS 5X WEEKLY COMMERCIAL MSW $ 185.18
4YD 1X WEEKLY COMMERCIAL MSW $ 194.14
4YD 2X WEEKLY COMMERCIAL MSW $ 320.60
4YD 3X WEEKLY COMMERCIAL MSW $ 447.01
4YD 4X WEEKLY COMMERCIAL MSW $ 573.48
4YD 5X WEEKLY COMMERCIAL MSW $ 699.90
4YD 6X WEEKLY COMMERCIAL MSW $ 826.33
4YD 7X WEEKLY COMMERCIAL MSW $ 952.81
4YD APARTMENT 1X WKLY COMMERCIAL MSW $ 250.62
4YD APT 2X WKLY COMMERCIAL MSW $ 435.75
4YD APT 3X WKLY COMMERCIAL MSW $ 620.94
4YD APT 4X WKLY COMMERCIAL MSW $ 806.10
4YD APT 5X WKLY COMMERCIAL MSW $ 991.22
4YD APT 6X WKLY COMMERCIAL MSW $ 1,176.41
5 96 GAL 1X WEEKLY COMMERCIAL MSW $ 200.44
5 96GAL 2X WEEKLY COMMERCIAL MSW $ 297.59
6 96 GAL 2X WEEKLY COMMERCIAL MSW $ 349.38
6 YD APT 6X WEEK COMMERCIAL MSW $ 1,728.09
6YD 1X WEEKLY COMMERCIAL MSW $ 248.32
6YD 2X WEEKLY COMMERCIAL MSW $ 426.71
6YD 3X WEEKLY COMMERCIAL MSW $ 605.12
6YD 6X WEEKLY COMMERCIAL MSW $ 1,140.28
6YD 7X WEEKLY COMMERCIAL MSW $ 1,318.71
6YD APARTMENT COMMERCIAL MSW $ 331.87
6YD APT 2X WKLY COMMERCIAL MSW $ 600.56
6YD APT 3X WKLY COMMERCIAL MSW $ 869.28
6YD APT 4X WKLY COMMERCIAL MSW $ 1,137.98
8 96GAL 1X WEEKLY COMMERCIAL MSW $ 308.52
8-96GAL WW 7X WKLY COMMERCIAL MSW $ 1,175.60
96GAL 1X WEEKLY COMMERCIAL MSW $ 56.37
96GAL 2X WEEKLY COMMERCIAL MSW $ 90.25
96GAL 3X WEEKLY COMMERCIAL MSW $ 124.13
96GAL 4X WEEKLY COMMERCIAL MSW $ 157.98

Page 3 of 5 ends

96GAL 5X WEEKLY COMMERCIAL MSW $ 191.90
96GAL 6X WEEKLY COMMERCIAL MSW $ 225.73
96GAL 7X WEEKLY COMMERCIAL MSW $ 259.61
RENTAL COMMERCIAL MSW $ 45.20
SILVER CITY / CREEKSIDE COMMERCIAL MSW $ 2.81
SUNDAY PICKUP COMMERCIAL MSW $ 79.04

1.5YD APT 7X WKLY COMMERCIAL MSW $ 636.66
2YD 5X WEEKLY COMMERCIAL MSW $ 419.99
3 96GAL 6X WEEKLY COMMERCIAL MSW $ 455.75
3 96GAL 7X WEEKLY COMMERCIAL MSW $ 521.23
BIN CLEANING COMMERCIAL MSW $ 62.31
EXTRA BAGS, BXS, CANS COMMERCIAL MSW $ 9.70
XTRA 32GAL GREEN WASTE COMMERCIAL MSW $ 6.96
LOOSE YARDAGE COMMERCIAL MSW $ 38.38
SMALL EXTRA COMMERCIAL MSW $ 19.93
Delivery Charge COMMERCIAL MSW $ 29.35
Temporary Rental Charge COMMERCIAL MSW $ 1.51
Special Pickup 1.5yd COMMERCIAL MSW $ 57.62
Special Pickup 1yd COMMERCIAL MSW $ 51.96
Special Pickup 2yd COMMERCIAL MSW $ 67.77
Special Pickup 3yd COMMERCIAL MSW $ 83.54
Special Pickup 4yd COMMERCIAL MSW $ 99.34
Special Pickup 6 yd COMMERCIAL MSW $ 121.12
STANDBY COMMERCIAL MSW $ 1.26
1 CAN 6X WEEKLY COMMERCIAL MSW $ 121.89
2YD APT 6X WEEKLY COMMERCIAL MSW $ 677.32
4 96GAL 7X WEEKLY COMMERCIAL MSW $ 652.13
6YD 5X WEEKLY COMMERCIAL MSW $ 961.91
8YD 1X WEEKLY COMMERCIAL MSW $ 302.51
SPECIAL TRIP FEE COMMERCIAL MSW $ 27.13
Commercial Recycle

1.5YD CARDBOARD COMM RECYCLING

1.5YD CARDBOARD 3X WKLY COMM RECYCLING $ 60.96

1.5YD RECYCLE 3X WKLY COMM RECYCLING $ 60.96

1.5YD RECYCLE 4X WKLY COMM RECYCLING $ 75.62

1.5YD RECYCLE 6X WKLY COMM RECYCLING $ 104.96
1YD CARDBOARD 3X WEEKLY COMM RECYCLING $ 50.81
1YD CARDBOARD 5X WKLY COMM RECYCLING $ 73.35
1YD CARDBOARD 6X WKLY COMM RECYCLING $ 84.70
1YD RECYCLE 3X WKLY COMM RECYCLING $ 50.81
1YD RECYCLE 5X WKLY COMM RECYCLING $ 73.37
2-96 GAL COMM RECY 6XWK COMM RECYCLING $ 85.15
2YD CARDBOARD 3X WKLY COMM RECYCLING $ 69.99
2YD CARDBOARD 6X WKLY COMM RECYCLING $ 122.52
2YD RECYCLE 3X WEEKLY COMM RECYCLING $ 69.99
2YD RECYCLE 4X WEEKLY COMM RECYCLING $ 87.49
2YD RECYCLE 6X WEEKLY COMM RECYCLING $ 122.52
3YD CARDBOARD 3X WKLY COMM RECYCLING $ 90.29
3YD CARDBOARD 4X WKLY COMM RECYCLING $ 114.62
3YD CARDBOARD 6X WKLY COMM RECYCLING $ 163.13
3YD RECYCLE 3X WEEKLY COMM RECYCLING $ 90.29
3YD RECYCLE 4X WEEKLY COMM RECYCLING $ 114.62
3YD RECYCLE 5X WEEKLY COMM RECYCLING $ 138.86
3YD RECYCLE 6X WEEKLY COMM RECYCLING $ 163.13
4YD CARDBOARD 3X WKLY COMM RECYCLING $ 111.79
4YD CARDBOARD 5X WKLY COMM RECYCLING $ 175.00
4YD CARDBOARD 6X WKLY COMM RECYCLING $ 206.63
4YD RECYCLE 3X WEEKLY COMM RECYCLING $ 111.79
4YD RECYCLE 4X WEEKLY COMM RECYCLING $ 143.37
4YD RECYCLE 5X WEEKLY COMM RECYCLING $ 175.00

Page 4 of 5 ends

San Luis Obispo City CouncilApril 19, 2022

San Luis Obispo City Council
April 19, 2022