Agenda packet — South Lake Tahoe City Council, December 10, 2024 (part 2 of 4)

Upon approval, the Consultant team will design and produce a schematic set of drawings that will delineate the scope for the contractor to price. Upon review of contractor pricing, client will review and decide if scope will move forward. Any unforeseen additions to this scope will require additional fee.

Architecture, JKAE $9,400.00
Specialty Architecture, BRS $5,000.00
Structural, Buehler $12,000.00
Electrical, The Engineering Enterprise $8,700.00
Mechanical, Capital $1,600.00
TOTAL FIXED FEE $36,700.00
Please acknowledge your acceptance of this Letter of Authorization with your signature below and return via email.

Sincerely: Approved:

JKAE

LETTER OF AUTHORIZATION
Task 3 – Client Requested Changes
CLIENT: City of South Lake Tahoe DATE: October 23, 2024 ATTN: Ricky Riddle PROJECT: 20-370 Recreation Swim Complex PROJECT AMENDMENT:

In accordance with the Professional Services Agreement for the above-mentioned project, dated July 28, 2020, this Letter of Authorization to Proceed confirms that our estimated effort for this project has been adjusted as follows:

Task 3 – Client Requested Changes
Client wishes to direct JKAE & Design Team to implement minor client-directed design changes. This additional service is meant to provide the design team with an extended budget to allow for these changes to occur without delay.

TIME & MATERIALS FEE $50,000.00
Note that design changes in excess of the $50,000 estimated maximum will be tracked as separate additional services in which JKAE will provide a separate proposal. JKAE will not proceed beyond the $50,000 estimated maximum without prior Client written authorization.

Please acknowledge your acceptance of this Letter of Authorization with your signature below and return via email.

Sincerely: Approved:

JKAE

Patrick Sheehan, Project Manager Client Date

LETTER OF AUTHORIZATION
Task 4– Metal Roof Deck Plumbing Support
CLIENT: City of South Lake Tahoe DATE: October 25, 2024 ATTN: Ricky Riddle PROJECT: 20-370 Recreation Swim Complex PROJECT AMENDMENT:

Task 4 – Metal Roof Deck Plumbing Support
The General Contractor has requested Buehler Engineering to review the capacity of the metal roof deck to be able to support plumbing systems directly from the deck. The desire is to be able to eliminate the added miscellaneous steel currently supporting the plumbing distribution system. The General Contractor will provide plumbing system hanger plans (PDF and CAD/Revit) with the hanger reactions noted for review. Buehler’s scope of work will include the following:
• Attend three meetings with the contracting team.
• Coordination with the plumbing contractor.
• Review of the hanging loads.
• Provide structural calculations to validate the deck capacity. • Review of plumbing hanger to metal deck connection details.

Structural Engineering, Buehler $8,800.00
JKAE-Coordination $880.00
Task 4 FIXED FEE $9,680.00
Please acknowledge your acceptance of this Letter of Authorization with your signature below and return via email.

Sincerely: Approved:

JKAE

LETTER OF AUTHORIZATION
Task 5 – LEED Submittal Reviews
CLIENT: City of South Lake Tahoe DATE: November 13, 2024 ATTN: Ricky Riddle PROJECT: 20-370 Recreation Swim Complex PROJECT AMENDMENT:

Task 5 – Metal Roof Deck Plumbing Support
The LEED submittal review time and budget allocation was exceeded due to multiple re-reviews of previous LEED submittals. These re-reviews necessitated additional coordination meetings/calls to resolve:
• Additional time (estimated at 20 hours) to review the remaining LEED submittals • Up to three additional one-hour virtual LEED CA coordination meetings • JKAE review and processing of these remaining LEED submittals LEED Additional Submittal Reviews/Meetings, Mead & Hunt $5,500.00 FIXED FEE $5,500.00
Please acknowledge your acceptance of this Letter of Authorization with your signature below and return via email.

Sincerely: Approved:

JKAE

Patrick Sheehan, Project Manager Client Date

Chris Vicencio, Partner, C 26985 Print Name / Title
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CITY OF SOUTH LAKE TAHOE

PROFESSIONAL SERVICES AGREEMENT
This Agreement is made and entered into as of the 281h day of July 2020 by and between the City of South Lake Tahoe, a municipal corporation (" City") and JK Architectural Engineering (" Consultant").

RECITALS
A. Consultant is specially trained, experienced and competent to perform the special services which will be required by this Agreement.

B. Consultant possesses the skill, experience, ability, background, certification and knowledge to provide the services described in this Agreement on the terms and conditions described herein.

C. City desires to retain Consultant to render professional services as set forth in this Agreement.

AGREEMENT
l. Scope of Services. Consultant shall perform the services set forth in this agreement and shall provide said services at the time, place, and in the manner specified in this agreement. Consultant shall have no power or authority by this Agreement to bind City in any respect.

The Consultant agrees that it has satisfied itself by its own investigation and research regarding the conditions affecting the work to be done and labor and materials needed, and that its decision to execute this Contract is based on such independent investigation and research. See Exhibit A for Consultant' s basis of understanding and scope of work.

All services provided by Consultant pursuant to this Agreement will be provided in accordance with the terms set forth in the Exhibit A, "Scope of Services," attached hereto and incorporated herein by reference, outlines the fees and compensation which shall be paid pursuant to this Agreement.

2. Term/ Time of Performance. The services by Consultant are to commence upon the execution of the Agreement and continue for three ( 3) years.

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3. Compensation. Compensation to be paid to Consultant shall be in accordance with the Schedule set forth in Exhibit A which is attached hereto and incorporated herein by reference. In no event shall Consultant' s compensation, including travel and out-of-pocket expenses, exceed 2,535,080 without additional written authorization from City. Payment by City under this Agreement shall not be deemed a waiver of defects, even if such defects were known to City at the time of payment. Payment is contingent upon compliance with all terms and conditions of this Agreement, as set forth herein. Consultant shall obtain prior written authorization from the City Project Manager for any costs in excess of budgeted amounts for each line item, task, or obligation under the Scope of Services.

4. Method of Payment. Consultant shall submit monthly billings to City describing the work performed during the preceding month. Consultant' s bills shall include a brief description of the services performed, the date the services were performed, the number of hours spent and by whom, the applicable hourly rate, and a description of any reimbursable expenditures. City shall pay Consultant no later than 30 days after approval of the monthly invoice by City staff.

5. Extra Work. At any time during the term of this Agreement, City may request that Consultant perform extra work. As used herein, " Extra Work" means any work which is determined by City to be necessary for the proper completion of the Project, but which the parties did not reasonably anticipate would be necessary at the execution of this Agreement. Consultant shall not perform, nor be compensated for, extra work without prior written authorization from City. Additional services and compensation to be mutually agreed upon.

6. Termination. This Agreement may be terminated by City or Consultant immediately for cause or without cause upon thirty days ( 30) days written notice of termination. Upon termination, Consultant shall be entitled to compensation for services performed up to the effective date of termination, and City shall be entitled to all work performed to that date.

Termination, revocation, or expiration of this Agreement shall not release either party from liability resulting from an event which occurred prior to such termination, revocation or expiration.

7. Ownership of Documents.

All plans, studies, documents and other writings, including working notes and internal documents, prepared by and for Consultant, its officers, employees and agents and subcontractors in the course of implementing this Agreement, shall become the property of City upon payment to Consultant C-084-2020
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for such work, and City shall have the sole right to use such materials in its discretion without further compensation to Consultant or to any other party.

Consultant shall, at Consultant' s expense, provide such reports, plans, studies, documents and other writings to City upon written request. All documents prepared by Consultant are confidential and shall be maintained to preserve their confidential nature. Release of any such documents to third parties shall only be made upon written consent of City.

8. Consultant' s Books and Records.
a. Consultant shall maintain any and all ledgers, books of account, invoices, vouchers, canceled checks, and other records or documents evidencing or relating to charges for services, or expenditures and disbursements charged to City for a minimum period of three (3) years, or for any longer period required by law, from the date of final payment to Consultant for services provided pursuant to this Agreement.
b. Consultant shall maintain all documents and records which demonstrate performance under this Agreement for a minimum period of three ( 3) years, or for any longer period required by law, from records shall be available at Consultant' s address indicated for the date of termination or completion of this Agreement. c. Any records or documents required to be maintained pursuant to this Agreement shall be made available for inspection or audit, at any time during regular business hours, upon written request by the City Manager, City Attorney, City Auditor or a designated representative of these officers. Copies of such documents shall be provided to City for inspection at City offices when it is practical to do so. Otherwise, unless an alternative is mutually agreed upon, the receipt of notices in this Agreement.
d. Where City has reason to believe that such records or documents may be lost or discarded due to dissolution, disbandment or termination of Consultant' s business, City may, by written request by any of the above-namedofficers, require that custody of the records be given to City and that the records and documents be maintained at City offices. Access to such records and documents C-084-2020
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shall be granted to any party authorized by Consultant, Consultant' s representatives, or Consultant' s successor- in-interest.

9. Independent Contractor. It is understood that Consultant, in the performance of the work and services agreed to be performed, shall act as and be an independent contractor and shall not act as an agent or employee of City.

Consultant shall obtain no rights to retirement benefits or other benefits which accrue to City' s employees, and Consultant hereby expressly waives any claim it may have to any such rights. All employees, agents, contractors or subcontractors hired or retained by Consultant are employees, agents, contractors or subcontractors of Consultant and not of the City.

City is not required to make any deductions or withholdings form the compensation payable to Consultant under the provisions of this Contract, and is not required to issue W-2 Forms for income and employment tax purposes for any of Consultant' s assigned personnel. Any third party persons employed by Consultant shall be entirely and exclusively under the direction, supervision, and control of Consultant. Consultant hereby indemnifies and holds City harmless from any and all claims that may be made against City based upon any contention by any third party that an employer- employee relationship exists by reason of this Contract.
l 0. Interest of Consultant. Consultant, ( and principals, associates and professional employees of consultant) covenants and represents that it does not now have any investment or interest in real property and shall not acquire any interest, direct or indirect, in the area covered by this Agreement or any other source of income, interest in real property or investment which would be affected in any manner or degree by the performance of Consultant' s services hereunder. Consultant further covenants and represents that in the performance of its duties hereunder no person having any such interest shall perform any services under this Agreement.

Consultant is not a designated employee within the meaning of the Political Reform Act because Consultant:
a. Will conduct research and arrive at conclusions with respect to his/ her rendition of information, advice, recommendation or counsel independent of the control and direction of City or of any City official, other than normal agreement monitoring; and,
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b. Possesses no authority with respect to any city decision beyond rendition of information, advice, recommendation or counsel. [ FPPC Reg. 18700( 0) (2)].

11. Professional Ability of Consultant. City has relied upon the professional training and ability of Consultant to perform the services hereunder as a material inducement to enter into this Agreement. Consultant shall therefore provide properly skilled professional and technical personnel to perform all services under this Agreement. All work performed by Consultant under this Agreement shall be in accordance with applicable legal requirements and shall meet the standard of care ordinarily to be expected of competent professionals in Consultant' s field of expertise.

12. Compliance with Laws. Consultant shall comply with all applicable federal, state, regional and local laws, codes, ordinances and regulations in carrying out his/ her duties under this Agreement. Consultant shall observe and comply with all applicable laws, ordinances, regulations and codes of federal, state and local governments, and shall commit no trespass on any public or private property in performing any of the work authorized by this Agreement. The City, its officials, officers, elected officials, appointed officials and employees shall not be liable at law or in equity as a result of any failure of Consultant to comply with this section.

In the event it is determined that the Consultant is required to pay prevailing wages for the work performed under this Agreement, the Consultant shall pay all penalties and wages as required by law.

13. Licenses. Consultant represents and warrants to City that it has all licenses, permits, qualifications, insurance and approvals of whatsoever nature which are legally required of Consultant to practice its profession. Consultant represents and warrants to City that Consultant shall, at its sole cost and expense, keep in effect or obtain at all times during the term of this Agreement, any licenses, permits, insurance and approvals which are legally required of Consultant to practice its profession. Consultant shall maintain a City of South Lake Tahoe business license at all times services are performed under this Agreement. Consultant acknowledges that payments made pursuant to this Agreement may be withheld until this provision has been satisfied.

14. Indemnity. Consultant hereby agrees to and shall indemnify and hold harmless City, its elected and appointed boards, officers, agents, employees and volunteers from and against any liability for any and all claims, demands, actions, losses, damages and injuries, direct or indirect ( including any and all C-084-2020
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costs and expenses in connection therein), arising out of this Agreement or caused in any way by Consultant' s negligent performance of this Agreement or its breach of its obligations contained in this Agreement, except for any such claims arising out of the negligence or willful misconduct of the City.

Consultant agrees to defend City from and against any and all losses, damages, claims costs and fees arising out Consultant' s negligent acts, errors. omissions, regarding this Agreement, the Consultant' s work under this Agreement. or the consultant's Scope of Work.

City does not. and shall not, waive any rights against Consultant which it may have by reason of the aforesaid hold harmless agreement, because of the acceptance by City, or the deposit with City by Consultant, of any of the insurance policies hereinafter set forth.

This hold harmless agreement by Consultant shall apply to all damages and claims for damages, or alleged to have been suffered. by reason of any of the aforesaid operation of Consultant or any subcontractor, regardless of whether or not such insurance policies shall have been determined to be applicable to any of such damages or claims for damages.

Consultant further waives any and all rights to any type of express or implied indemnity or right of contribution from the City for any liability, claims. demands. costs, charges and expenses and causes of action of whatsoever arising out of or in any way connected with this Agreement, and consultant' s work under this Agreement.

15. Insurance Requirements.
a. Consultant, at Consultant' s own cost and expense. shall procure and maintain. for the duration of the contract, the following insurance policies.
i. Workers' Compensation Coverage. Consultant shall maintain Workers' Compensation Insurance and Employer' s Liability Insurance for his/ her employees in accordance with the laws of the State of California. In addition, Consultant shall require each subcontractor to similarly maintain Workers'
Compensation Insurance and Employer' s Liability Insurance in accordance with the laws of the State of California for all of the subcontractor's employees. Any notice of cancellation of all Workers' Compensation policies must be received by City C-084-2020
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at least thirty ( 30) days prior to such change. Consultant shall provide thirty ( 30) days written notice of nonrenewal of any Workers' Compensation policies. The insurer shall agree to waive all rights of subrogation against City, its officers, agents, employees and volunteers for losses arising from work
performed by Consultant for City.

11. Commercial General Liability Coverage. Consultant shall maintain commercial general liability insurance no less broad than ISO form CG 00 01 in an amount not less than one million dollars ($ 1,000,000) per occurrence for bodily injury, personal injury and property damage. Coverage must be made on
the standard Occurrence form. Claims- Made forms are not acceptable without prior written consent of City. City of South Lake Tahoe must be endorsed as an additional insured for liability arising out of ongoing operation by on behalf of Consultant. If a commercial general liability insurance form or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to the work to be performed under this Agreement or the general
aggregate limit shall be at least twice the required
occurrence limit.
iii. Automobile Liability Coverage. Consultant shall maintain automobile liability insurance covering bodily injury and property damage for all activities of the Consultant arising out of or in connection with the work to be performed under this Agreement, including coverage for owned, hired and nonowned vehicles, in an amount of not less than one million dollars ($ 1,000,000) combined single limit for each occurrence. 1v. Professional Liability Coverage. Consultant shall maintain professional errors and omissions liability insurance for protection against claims alleging negligent acts, errors or omissions which may arise from Consultant or by its employees, or subcontractors. The amount of this insurance shall not be less than one million dollars ($ 1,000,000) on a claims- made annual aggregate basis, or a combined single- limit per occurrence basis.

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b. Endorsements. Each general liability and automobile liability insurance policy shall be with insurers possessing a AM Best' s rating of no less than A:VII and shall be endorsed with the following specific language:

1. City, its elected or appointed officers, officials, employees, agents and volunteers are to be covered as additional
insured' s under Consultant' s General Liability and Automobile Liability policies with respect to liability arising out of this Agreement and/or work performed by or on behalf of the
Consultant, including materials, parts or equipment furnished in connection with such work or operations.
ii. This policy shall be considered primary insurance as respects City, its elected or appointed officers, officials, employees, agents and volunteers. Any insurance maintained by City, including any self-insured retention City may have, shall be considered excess insurance only and shall not contribute with it.
iii. This insurance shall act for each insured and additional insured as though a separate policy had been written for each,
except with respect to the limits of liability of the insuring Consultant.
iv. The insurer waives all rights of subrogation against City except for Consultant' s Professional Liability and Employers' Liability policies, its elected or appointed officers, officials, employees or agents.
v. Any failure to comply with reporting provisions of the policies shall not affect coverage provided to City, its elected or appointed officers, officials, employees, agents or volunteers. vi. No policies of insurance carried by Consultant shall be suspended, voided, canceled, or changed in coverage or in limits except after thirty ( 30) days written notice to the City Attorney by Certified Mail.
c. Deductibles and Self-Insured Retentions. The Consultant shall be responsible for all deductibles in all of Consultant' s insurance policies.

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without the written authorization of City. If City consents to such subcontract, Consultant shall be fully responsible to City for all acts or omissions of the subcontractor. Nothing in the Agreement shall create any contractual relationship between City and subcontractor nor shall it create any obligation on the part of City to pay or to see to the payment of any monies due to any such subcontractor other than as otherwise required by law.

18. Waiver. Waiver of a breach or default under this Agreement shall not constitute a continuing waiver of a subsequent breach of the same or any other provision under this Agreement.

19. Dispute Resolution. Any dispute concerning this Agreement will be first submitted to the City Manager or his designee for resolution. If no resolution is reached, such dispute shall be submitted to the City Council. The decision of the City Council shall be final and shall be appealable only to the El Dorado Superior Court pursuant to California Code of Civil Procedure§ l 094. 5, and as provided by law.

20. Controlling Law Venue. This Agreement and all matters relating to it shall be governed by the laws of the State of California and any action brought relating to this Agreement shall be held exclusively in the Superior Courts in the County of El Dorado, South Lake Tahoe Division.

21. Prohibited Interests. Consultant maintains and warrants that it has not employed nor retained any Consultant or person, other than the independent contractors hired in accordance with Consultant' s standard business practice, to solicit or secure this Agreement. Further, Consultant warrants that it has not paid nor has it agreed to pay any Consultant or person, other than a bona fide employee working solely for Consultant or an independent contractor hired as discussed above, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, City shall have the right to rescind this Agreement without liability. For the term of this Agreement, no member, officer or employee of City, during the term of his or her service with City, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.

22. Equal Opportunity Employment. Consultant represents that it is an equal opportunity employer and it shall not discriminate against any subcontractor, employee or applicant for employment because of race, religion, color, national origin, disability, ancestry, sex or age. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination. Consultant shall also comply with all relevant provisions of City' s C-084-2020
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Minority Business Enterprise program, Affirmative Action Plan, or other related programs or guidelines currently in effect or hereinafter enacted.

23. Drug-Free Workplace Certification. By signing this Agreement, Consultant hereby certifies under penalty of perjury under the laws of the State of California that the Consultant will comply with the requirements of the DrugFree Workplace Act of 1990 ( Government Code Section 8350, et seq.) and will provide a drug-free work place by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture, distribution dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations, as required by Government Code Section 8355 ( a). b. Establish a Drug-Free Awareness Program as required by Government Code Section 8355( b) to inform employees about all of the following:
i. The dangers of drug abuse in the workplace;
ii. The person' s or organization' s policy of maintaining a drug-free workplace;
iii. Any available counseling, rehabilitation and employee assistance program; and
1v. Penalties that may be imposed upon employees for drug abuse violations.
c. Provide, as required by Government Code Section 8355( c), that every employee who performs grant activities under this Agreement:
i. Will receive a copy of the Consultant' s drug-free policy statement; and
ii. Will agree to abide by the terms of the Consultant' s statement as a condition of employment on this Agreement.

Failure to comply with these requirements may result in suspension of payments under this Agreement or termination of the Agreement. or both, and Consultant may be ineligible for award of any future City agreements if City determines that any of the following has occurred: the Consultant l)has made false certification, or (2) violates the certification by failing to carry out the requirements as noted above.

24. Anti-Lobbying Certification. Consultant shall submit to City the Anti-Lobbying Certification contained in Exhibit B. Further, Consultant shall require that the language of the certification in Exhibit B be included in all contracts or C-084-2020
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subcontracts entered into in connection with this Agreement and that all Consultants and contractors shall certify and disclose accordingly.

25. Debarment, Suspension, Ineligibility and Voluntary Exclusion. By signing this Agreement, Consultant assures that neither it nor its principals, is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participating in covered transactions by any Federal department or agency.

26. Americans with Disabilities Act. By signing this Agreement, Consultant assures the City that it complies with the American with Disabilities Act (ADA) of 1990, 42 U.S.C. 12101, et.seq.), which prohibits discrimination on the basis of disability, as well as all applicable regulations and guidelines issued pursuant to ADA.

27. Amendments. This Agreement may be modified or amended only by a written document executed by both Consultant and City and approved as to form by the City Attorney.

28. Severability. If any term or portion of this Agreement is held to be invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions of this Agreement shall continue in full force and effect.

29. Entire Agreement. This Agreement constitutes the complete and exclusive statement of Agreement between City and Consultant. All prior written and oral communications, including correspondence, drafts, memoranda, and representations, are superseded in total by this Agreement.

30. Execution. This Agreement may be executed in several counterparts, each of which shall constitute one and the same instrument and shall become binding upon the parties when at least one copy hereof shall have been signed by both parties hereto. In approving this Agreement, it shall not be necessary to produce or account for more than one such counterpart.

31. Time is of the Essence. Time is of the essence for this Agreement.

32. Authority to Enter Agreement. Consultant has all requisite power and authority to conduct its business and to execute, deliver, and perform the Agreement.

Each party warrants that the individuals who have signed this Agreement have the legal power, right, and authority to make this Agreement and to bind each respective party.

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on the date first written above.

CITY OF SOUTH LAKE TAHOE:

Mayor, Jason Collin
APPROVED AS TO FORM:

By cz../:; a
City Attorney
ATTEST:

Attachments:

CONSULTANT:
rdan Knighton, Partner
Business License # ______ _
Exhibit A - Scope of Services
Exhibit B - Anti-Lobbying Certification
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on the date first written above.

CITY OF SOUTH LAKE TAHOE: CONSULTANT:

By___________________________ By ________________________________ Mayor, Jason Collin Jordan Knighton, Partner
Business License # __________________
APPROVED AS TO FORM:

By____________________________
City Attorney, Heather Stroud
ATTEST:

By____________________________
City Clerk , Susan Blankenship
Attachments:

Exhibit A – Scope of Services
Exhibit B - Anti-Lobbying Certification
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EXHIBIT A

SCOPE OF SERVICES - RECREATION CENTER A&E SERVICES

JK ARCHITECTURAL ENGINEERING
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JK ARCHITECTURE

INTRODUCTION
July 21, 2020
Jim Marino
Capital Improvements Project Manager
Department of Public Works
1052 Tata Lane
South Lake Tahoe, CA 96150
jmarino@cityofslt. us
Jim,
We are delighted to provide you with our professional services proposal for the design and engineering of the City of South Lake Tahoe Recreation/ Aquatic Complex. The JKAE/ BRS team is excited to have the opportunity to collaborate with the City and community on a journey to IMAGINE, DESIGN, and CREATE an exceptional new facility that is inspiring as well as uplifting and that meets and exceeds the expectations of City of South Lake Tahoe community.

We have put together a comprehensive proposal that outlines the proposed Project Approach, Scope of Work, comprehensive Fee, and detailed Schedule for the project. We understand that every project is a journey of sorts and that the City of South Lake Tahoe began this visioning process several years ago. As such we will continue to jump in to understand and incorporate the past history of the site and project. In addition, we will be working collaboratively with your master- planning team to dovetail our site and building design process with that of the master- planning effort for the larger 56 acre park master plan that will move ahead concurrently with our process ..

We believe we have put together an efficient and cost- effective design approach that will allow for extensive and productive community engagement, while confirming that the end result is a facility that helps to define the future vision of the City and the community. Our team is prepared to move forward with a process that we believe will be fulfilling and highly collaborative. We understand that the City will benefit by having a trusted advisor who brings decades of experience in community process, public sector design, and recreation center design. We place a high value on the trust the City is placing in our team. and we take that to heart. We will endeavor to continue to build upon that trust over the coming months and years to help deliver a phenomenal new facility, with all the incredible experiences that it will offer for the community and visitors of the City of South Lake Tahoe.

Please review the materials we have provided and let us know your questions and comments. There is a lot to absorb and we would therefore like to walk through this proposal with you in detail to answer your questions.

Sincerely,
Jordan Knighton, AIA Katie Barnes, AIA
Partner JK Architecture Engineering
C-15848
Managing Partner, Barker Rinker Seacat Architecture

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 I 165 River Road, Tahoe City, CA 96145 530. 583. 9222 www.jkaedesign. com C-084-2020
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JK ARCHITECTURE

PROJECT APPROACH
For your review and input, we have prepared a Preliminary Work Plan based upon our expertise in delivering master planning and design of civic recreational and aquatic facilities. Each project we design evolves and is adjusted through the collaboration of our team and clients to assure that our process and deliverables meet your Form, Function, Time (Schedule), Economy ( Budget), and Sustainable goals and constraints. We have developed the following project approach to define the various phases of the City of South Lake Tahoe Recreation Center project that will be required through the duration of the project.

To achieve these goals the following is a summary of our collaborative planning, design, and construction support process:

T S E
E::,..,
Program Verification & Conceptual Design
Project Program
Support Master Planning effort by others
Site Analysis & Determination
Conceptual Design
Schematic Design - Agency Review
Schematic Design
Design Development
Construction Documents
Agency Review
Bid & Construction Services
Bid Support
Construction Administration Services
Project Closeout Support

SCOPE OF WORK UNDERSTANDING I PROJECT OVERVIEW
JKAE Architecture Engineering and Barker Rinker Seacat Architecture ( JKAE/ BRS) have prepared the following scope of services and fee proposal to assist the City of South Lake Tahoe with the program for your new Recreation and Aquatics Center. We will collaborate with your master- planning team to develop a program and site/building concept for the new facility.

Construction Budget: $ 24M
Note the current soft- cost allocation is $6M for a total Project Budget of $30M. (to be confirmed during program development).

Project Requirements: New Recreation and Aquatics Center potentially including the following ( to be confirmed to align with allowable budget):

Leisure and Competition Aquatics Space
WorkouUFitness Space
Two to Four- Court Gymnasium
Elevated Gymnasium Running Track
Meeting and Classroom Space
Multi- Purpose Space
Senior Activities Space
Commercial Kitchen and Food Preparation Areas
Office/ Administration Space
Mechanical Areas
Civil/Site Design Including
Topographic Survey
Geotechnical & Hydrological Reports
Land Coverage Calculations
Parking Improvements
Ingress/ Egress Roads

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530. 583. 9222 www. jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 367

JK ARCHITECTURE
I
T
Stormwater Improvements
Site Lighting, as determined by Electrical Engineer
ADA Accessibility
Pedestrian Walkways & Signage
Landscaping and Hardscape, as determined by Landscape Architect Consultants/ Engineering ( Base Services):

Civil Engineer ( JKAE)
Landscape Design ( Design Workshop)
Structural ( Buehler Engineering)
Aquatic Design ( Aquatic Design Group)
Mechanical/ Plumbing/ Fire Sprinkler ( Capital Engineering) Electrical/ Lighting/ Low Voltage/ Fire Alarm ( The Engineering Enterprise) Kitchen Design ( AMO Kitchen Design)
Acoustic ( Bollard Acoustical)
Cost Estimating ( Cumming Corp)
Sustainable Design ( Supplemental Services)
LEED Consulting Services (Ambient- e)
LEED Gold minimum preferred
Other Services ( Supplemental Services)
Geotechnical Engineering/ Study ( NV5)
Topographic Survey (Psomas. formerly Andregg)
TrafficStudy (LSC)
TRPA Support ( JKAE)
CEQA Support ( Ascent Environmental. Inc.)
Project Goals:

The Recreation Center Project is a community- driven project in which the City of South Lake Tahoe desires to create a significant recreation and aquatics facility that strives to be; sustainable, architecturally relevant to the surroundings, easily accessible, multi- functional, and environmentally responsible.

1.1 PROJECT PROGRAM VERIFICATION, PRE-DESIGN, AND COLLABORATION WITH MASTER-PLANNING TEAM JKAE/BRS will work collaboratively with the City of South Lake Tahoe to refine and finalize the project program.

A. General Approach:

1. Facilitate a City Project Team ( CPT) Kickoff Meeting with participants as identified by the City to define roles and responsibilities and confirm the planning process approach and project schedule. Develop and issue meeting notes for one (1) kickoff meeting, two ( 2) anticipated Stakeholder Interviews.

2. Existing facilities on the site are not anticipated to be a part of the project. Should existing facilities become included in the project. City to compile and make available to the design team as-built information of the existing facilities, provided by Owner, including original construction drawings and upgrades that have occurred over time.

3. Review pertinent codes and zoning to understand code and land- use constraints of the project.

4. Review background information such as previous topographic maps, and geotechnical studies as well as comprehensive review of previous concepts, reports. site history, master plans, and community plans. Prior programming, planning and design studies for the site shall be provided by the City.

5. Visit the site to visually assess the existing site conditions such as access and circulation, views, sun exposure. relationship of structures, adjacent properties, etc.

6. Regular communication and coordination with City and the Master Planning Consultant, Design Workshop throughout the planning process.

B. Program Goals:

Kick- Off Meeting with SLT Recreation Manager to develop initial program building upon prior community goals and establish the basis of new community outreach and validation.

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530. 583.9222 www. jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 368

JK ARCHITECTURE
C. Community Outreach I Public Meeting Process:

The JKAE/ BRS team will collaborate with the City Project Team ( CPT) and Design Workshop at the outset of the project to "right size" the quantity, scheduling and format of public meetings to align with the City's goals for this process. JKAE/ BRS will facilitate public meetings with the goal of gathering community input and context, as well as actively informing the community regarding the project' s schedule, program and design.

Public meetings can be held in-person and/or virtually.

We recommend a project Vision and Conditions of Satisfaction be shared at the beginning of each public meeting.

Programming exercises in the first public meeting allow the community to participate in prioritizing what can be accomplished with the funds available. Our program prioritization exercise, called "DotOcracy", includes a voting process as well as a solicitation of comments.

Concept renderings and informational materials will be provided at community meetings and on the project website.

D. Facility Operations Analysis
The JKAE/BRS team will provide services related to program element and capital and operation cost analyses based on city cost recovery philosophy, budgets for expense and revenue projections, staffing, operating hours and scheduling, attendance estimates, fee structures and maintenance plans.

E. Meetings and Workshops: (all meetings to be coordinated with Park Master Plan Team, as appropriate) The project design schedule is organized around key Client Workshops. Workshop attendees will include the City Project Team ( CPT) and the JKAE/BRS team as well as Design Workshop and any other appropriate consultants at specific engagement points. BRS' Owner Decision Matrix identifies all Workshop agenda items including each client team decision.

City Project Team ( CPT) Kick- Off Meeting
City Project Team ( CPT) Workshops: Five ( 5) anticipated ( to be confirmed) TRPA Pre-Development Meeting: One ( 1) - Refer to Section 3.1.A Agency Permit Review - TRPA for additional information
Initial coordination with TRPA for land capability verification, existing coverage verification, and identification of potential site constraints for consideration during the site selection process SLT Planning Department Pre-Development Meeting: One (1) Stakeholder Interviews: One ( 1)
Stakeholder Review Meeting: One ( 1)
City Project Team (CPT) Check- In Calls ( between Workshops) - Six (6) proposed, as needed Public Meetings: Three ( 3) anticipated
Parks Board I SLT Planning Commission Presentation: One Joint ( 1) City Council Presentation: One ( 1)
F. Deliverables:

Non- statistically valid online public survey results and analysis Project specific website
Public feedback results and analysis
Preliminary code analysis
Preliminary site analysis
Project program summary
Establish master- plan level design options
Meeting minutes
Preliminary- design level basis of design report
G. Cost Estimate: Preliminary- design level cost estimate H. Programming Phase Note: The Programming Phase includes the engagement of the park master plan team in a collaborative community process achieving relevant efficiency. In the event the park master plan process does not proceed, a contract adjustment will be negotiated to accommodate said change to the process.

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530. 583. 9222 www.jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 369

JK ARCHITECTURE

2.1 SCHEMATIC DESIGN
A. General Approach:

Establish an overall design direction and prepare and submit Schematic Design Documents illustrating the scale and relationship of project components. We will submit a program and estimate for the cost of the work along with Schematic Design Documents and Schedule to the City for review and approval. The City will provide written approval of the scope that they agree to move forward with into the Design Development Phase that meets the approved construction budget. Scope areas that are outside of the allowed budget will be carried as add alternates through Schematic Design but will not be developed further than the Schematic Design level. The information will be available for future design and documentation as an additional service when project funding is available.

B. Meetings and Workshops:

City Project Team ( CPT) Workshops: Three ( 3)
CPT Check- In Calls ( between Workshops): Four ( 4) proposed, as needed Permitting Agencies: South Lake Tahoe Planning Review. Two ( 2) meetings.

Public Meetings: One ( 1)
C. Deliverables: Schematic Design Package including preliminary code review, site plan, floor plans, schematic pool plans and sections, building sections, exterior elevations, exterior three- dimensional renderings, color palette, interior design narrative and initial LEED score card. Schematic Design plans will include preliminary site layout & utilities, grading, landscaping and coverage calculations, per TRPA requirements.

0. Cost Estimate: Schematic- Design level cost estimate.

2.2 DESIGN DEVELOPMENT
A. General Approach:•
Develop the approvedSchematic Design Documents for the preferredprojectsite to fixand describe the size and character of the projectas to architectural, structural. mechanical and electrical systems. aquatic, landscape and civil site development. Develop design-development level specifications ( CS/ format). Consider the value of alternativematerials. building systems and equipment, together with other considerations based on program and aesthetics.

B. Meetings:

CPT Workshops: Three ( 3)
CPT Check- In Calls ( between Workshops): Five ( 5) proposed, as needed Permitting Agencies: TRPA
Public Meetings: None
Rec Board I SLT Planning Commission Meeting: One ( 1)
C. Deliverables: Design- Development Package including architectural and all engineering disciplines to include code analysis updates, site plan, floor plans, roof plans, reflected ceiling plans, enlarged plans building sections, wall sections, partition types interior and exterior elevations, interior design materials selections and finishes, preliminary details, furnishing and fixture schedules, color palette, interior design narrative and LEED score card.

Civil Design Development plans will include preliminary site layout & utilities, grading & drainage, temporary and permanent BMPs, coverage calculations, construction notes and details. A preliminary Drainage Report will also be prepared. The Design Development package will be used for CEQA and TRPA submittals. Requested design revisions after work under this task begins will be considered Additional Services and billed on a Time and Materials basis.

D. Cost Estimate: Design- Development level cost estimate at 100% DD.

Include soft- cost estimate for furnishings, fixtures, gym equipment, and other misc. equipment

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 I 165 River Road. Tahoe City, CA 96145 530.583.9222 www.jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 370

JK ARCHITECTURE

2.3 CONSTRUCTION DOCUMENTS
A. General Approach:

Finalize the approved Design Development Documents, including architectural and all engineering disciplines, to a level satisfactory for permitting and bidding. Develop Drawings and Specifications setting forth in detail the quality levels of materials and systems and other requirements for the construction of the Work. Incorporate design requirements of governmental authorities having jurisdiction. Assist the City in the development and preparation of bidding and procurement information, the form of agreement between Owner and Contractor, and the Conditions of the Contract for Construction. Compile a project manual that includes the Conditions of the Contract for Construction and Specifications as well as bidding requirements and sample forms incorporating front- end documents provided by the City' s legal counsel. An early site package is anticipated in order to start the permit review process early. An early or multiple building package( s) are not included in this scope of work.

B. Meetings:

CPT Workshops: Two ( 2)
CPT Check- In Calls ( between Workshops): Seven ( 7) proposed, as needed Permitting Agencies: South Lake Tahoe Building Department, El Dorado County Health Department. El Dorado County Fire and Relevant Utility Agencies
Public Meetings: None
C. Deliverables: Construction- Document Package including architectural and all engineering disciplines to include code analysis updates, site plan, floor plans, roof plans. reflected ceiling plans, enlarged plans building sections, wall sections, partition types interior and exterior elevations, interior design materials selections and finishes, details, furnishing and fixture schedules, color palette, interior design narrative and LEED score card. Civil Construction Documents will contain the final design for site layout & utilities, grading drainage, temporary and permanent BMPs. coverage calculations, drainage report, construction specifications. and design calculations suitable for approval by the City of South Lake Tahoe, El Dorado County, Fire and relevant utility agencies. This scope does not include Bid Phase work, Construction Administration work, or Agency Approvals processing. General project Administration is included. Requested design revisions after work under this task begins will be considered Additional Services and billed on a Time and Materials basis.

D. Cost Estimate: Construction- Document level cost estimate at 100% CD (permit submittal).

Include soft-cost estimate for furnishings, fixtures, gym equipment, and other misc. equipment to begin program operation.

Note: This estimate shall be used as Engineer' s Estimate during the bid phase. p

3.1 AGENCY PERMIT REVIEW
This task will include permit submittal of drawings and specifications to the City Building Department, and City Public Works department, as necessary, Fire, Utility Districts, and County Department of Environmental Health.

The following products will be prepared/ delivered for this section:

Documents as required for building permit submittal including permit review application and kitchen equipment cut sheets as required by County Department of Environmental Health.

Note: All permit submittal/ review fees to be paid by the City.

This scope includes coordination response to review comments, coordination with Client and design team, and General Project Administration. The estimated budget for this phase assumes up to two rounds of review and comments from the applicable agencies.

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 I 165 River Road, Tahoe City, CA 96145 530. 583.9222 www.jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 371

JK ARCHITECTURE
Assumptions & Exclusions:

At this time, it is assumed no work will be proposed within the Caltrans ROW and, therefore, this proposal does not include coordination or permitting efforts through Caltrans.

TRPA Soils/ Hydro application and approval, if required, to be obtained by the Geotechnical Engineer.

3.1.A AGENCY PERMIT REVIEW- TRPA:

This task will include review coordination and processing of required TRPA permits and approvals as listed below:

Review of available existing background information for the project site during Program Verification/ PreDesign Phase ( as described in Section 1.1 above); Initial coordination with TRPA during Program Verification/ Pre-Design Phase ( as described in Section 1.1 above) for land capability verification and existing coverage verification, and identification of potential site constraints to assist the site selection process;
Pre-Development application and coordination meeting ( to be completed during the Program Verification/ Pre-Design Phase, as described in Section 1.1 above); After completion of the Civil Design Development and Architectural Schematic Design phases, JKAE will prepare a complete application package, including but not limited to the Initial Environmental Checklist, and Findings for submittal to TRPA.

Response to review comments and permit coordination;
Review of final Conditions of Approval.

Assumptions & Exclusions:

It is expected that the TRPA Permit Processing will be done concurrently with the CEQA review process described under Section 3.2 Environmental Services.

TRPA Soils/ Hydro application and approval, if required, to be obtained by the Geotechnical Engineer.

3.1.B AGENCY PERMIT REVIEW- LAHONTAN Regional Water Quality Control Board:

Under this scope of work JKAE/ BRS will prepare the SWPPP report and package, as required by the California Regional Water Quality Control Board ( Lahontan) Construction General Permit. This scope also includes uploading the Lahontan required documentation to the Storm Water Multiple Application and Report Tracking System ( SMARTS) website for Lahontan approval, necessary revisions to the SWPPP package, coordination with Lahontan and Client.

We anticipate only minor revisions to the SWPPP package during the review process.

Assumptions & Exclusions:

SWPPP Report will be prepared after completion of the Construction Documents ( see Section 2.3 above); As required by the Water Board, Client will set- up the project in SMARTS and add JKAE/ BRS as a Data Entry Person. Once that process is complete, JKAE/ BRS will upload the required information for permit approval.

JKAE/BRS will provide assistance to Client to set-up the project in SMARTS, as necessary.

3.2 ENVIRONMENTAL SERVICES
This task will be prepared by CEQA consultant ( Ascent Environmental) using the documentation prepared under Section

2.2 Design Development to support development of the project description for the environmental document. Scope under this task is as outlined below, however the exact scope of work for environmental services will depend on further refinement of the project scope, thus this scope will need to be refined:

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530. 583.9222 www.jkaedesign.com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 372

JK ARCHITECTURE
Development of project description - Area of Potential Effect ( APE): The CEQA consultant will review materials prepared during earlier tasks to delineate and APE and prepare a project description for evaluation in the environmental analysis. The consultant will prepare a draft project description and APE for review by the City. The consultant will address one set of comments from the City and prepare a final APE and project description.

Initial checklist: The CEQA consultant will prepare an initial study ( IS) with responses to all questions listed in Appendix G of the State CEQA Guidelines. The IS will include substantial evidence to support all impact determinations. The consultant will prepare a draft IS for City review, address one set of comments from the City and prepare a print check draft. Following City review of the print check IS, the consultant will make final edits to the IS, if necessary, and produce the environmental document for public review and comment Notice of Preparation ( NOP): Based on our current understanding of the project, it is assumed that all impacts of the project can be mitigated to a less than significant level, such that an IS and Mitigated Negative Declaration { IS/MND) will be the appropriate level of environmental review. Preparation of an NOP is not required for an IS/MND. However, if an Environmental Impact Report ( EIR) is the appropriate level of environmental review, the consultant will prepare and distribute an NOP.

Notice of Intent ( NOi): To begin the public review period for the anticipated IS/MND, the consultant will prepare and circulate a draft and final NOi.

Public Scoping Meeting( s): As stated above, it is anticipated that an IS/MND would be the appropriate level of environmental review. Preparation of an IS/MND does not require a formal scoping period or scoping meeting. However, if required or desired, the consultant can facilitate a scoping meeting either in person or virtually as pandemic conditions dictate.

Progress Meetings: The CEQA consultant will attend regular progress meetings with the project team during the environmental review phase of the project.

Schedule: The CEQA consultant will develop and maintain a mutually agreed upon schedule for preparation of the environmental document.

Technical Studies and Reports, as required: It is assumed that the IS/MND will tier to the program- level IS/MND that will be prepared for the 56-Acre Park Master Plan. As such, technical studies prepared for program- level IS/MND are expected to be sufficient for several resource areas, including transportation and circulation, and biological resources. The consultant will prepare other technical studies as necessary, which could include a site-specific survey for cultural resources and/or visual simulations of the proposed project.

Statement of Objectives, and Purpose and Need: The CEQA consultant will work collaboratively with the project team to develop a statement of objectives that describes the purpose and need for the project. These objectives will be incorporated into the project description.

Alternatives Evaluation: As stated above, it is anticipated that an IS/MND would be the appropriate level of environmental review. Preparation of an IS/MND does not require an evaluation of alternatives. If preparation of an EIR is necessary, or if the City desires and alternative evaluation, the CEQA consultant will prepare an alternatives evaluation.

Document preparation and Clearinghouse filing: The CEQA consultant will be responsible for preparation and production of the environmental document and filing with the state clearinghouse and county clerk, as necessary.

Assumptions & Exclusions:

Budgeting for this task requires greater definition of project scope, therefore, the provided budget is for preliminary planning purposes only. Scope and budget will be refined by CEQA consultant in coordination with the City, after further determination of project scope. The scope and budget above are provided for planning purposes.

Initial budget estimate provided assumes the program- level CEQA document for the 56-Acre Park Master Plan will be available first, and the Rec Center CEQA document will be an Initial Study/ Mitigated Negative Declaration that is tiered to the program- level document for the Master Plan.

After further project scope determination, JKAE will provide supporting documentation and information necessary to assist CEQA consultant in the preparation of the documents listed above.

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530.583.9222 www.jkaedesign.com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 373

JK ARCHITECTURE
Technical Studies and Reports - it is our understanding that Master Plan level technical studies and reports are being prepared for the entire site and, it is expected that some of these studies and reports would be reused for the site specific CEQA application.

3.3 BID SUPPORT
This task is to prepare for and assist Owner with the public bidding of this project:

1. Coordinate specifications booklet with City' s legal- counsel provided front- end bid documents.

2. Assist City with solicitation of bids by notifying local contractors, regional trade associations, and regional plan houses.

3. Assist City with conducting of a, mandatory or non- mandatory, pre-bid meeting.

4. Review pre-bid RFls and Issue pre- bid Addenda as necessary.

5. JKAE will make bid drawings and documents available electronically by PDF format. Hard copies for bid purposes may be ordered by Owner at Owner expense from local print service of Owner' s choosing.

6. Attend bid opening and log bid responses.

7. Note: Should City decide to rebid project, JKAE will provide Bid Support on the additional bid on a Time and Materials basis.

The following products will be prepared/ delivered for this section:

Bid RFI responses as required.

Bid addenda as required
Attendance at one pre-bid meeting and notes from the meeting.

3.4 CONSTRUCTION ADMINISTRATION SUPPORT
This task will be where our team will help administer the contract for construction:

1. Attendance at construction meetings, frequency to be confirmed

2. Review of project schedule, schedule of values, and other contractually- required materials provided by General Contractor.

3. Response to RFls.

4. Review of submittals and pay applications.

5. Issuance of ASls and clarifications.

6. BRS Natatorium Pre-Construction Meeting

7. Review of change order requests and assistance with drafting change orders for City' s approval

8. Observance of construction for general conformance with the contract documents.

9. JKAE punch list of final construction.

10. JKAE review of contractor- provided as built drawing set ( suggest that contract for construction require hot-linked as-built PDF file from General Contractor).

11. JKAE will provide an electronic record set that is overlaid on the general contractor' s approved electronic as-built set. The overlay will include attached RFls, ASls, CCDs, and Change Orders. The formatting will be in BluBeam formatted as a PDF.

12. JKAE review of manuals and warranties provided by General Contractor.

13. JKAE assistance with Grand Opening event including project flyer and graphics support to City.

Assumptions & Exclusions:

1. QSP ( Qualified Stormwater Practitioner) services, as required by Lahontan, have not been included based on the assumption the Contractor will be performing related tasks.

SCHEDULE
The following is an estimated schedule to complete the tasks described above. ( See attached Gantt schedule for more detail) 5 Months
Project Program & Conceptual Design 5 months

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530.583.9222 www.jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 374

JK ARCHITECTURE
Schematic Design
SD Phase

15.5 Months
SD Cost Estimate, Client Review & NTP
Design Development
DD Phase
DD Cost Estimate, Client Review & NTP
Construction Document Phase
CD Phase
CD Cost Estimate, Client Review & NTP
Agency Permit Review
Building/ Public Works/ County Health
19 months
Bid Support
Construction Administration Services

COST PROPOSAL
3months
2 weeks
4 months
2 weeks
4 months
2 weeks ( Simultaneous with Agency Permit Review)
3months
3months
2 months
17 months ( to be verified by General Contractor)
The following is our fee proposal to accomplish the scope described in the preceding Project Work Plan pages for Tasks 1. 1 throug .. h32 Weloo kforward to advancing these scope and fee strategies to meet your goals.

Programming and Concept Design
Schematic Design
Please note that a budget of $37,500 is built into the fixed fee for CEQA services during schematic design phase.

While we do not expect the need for services to exceed $ 37, 500; there could be an issue or complication in the CEQA process out of our control that requires additional services should the $37, 500 budget be exceeded.

Design Development
Please note that a budget of $37,500 is built into the fixed fee for CEQA services during design development phase. While we do not expect the need for services to exceed $ 37, 500; there could be an issue or complication in the CEQA process out of our control that requires additional services should the $ 37,500 budget be exceeded.

Construction Documents
Agency Review
Bid Support
Total Base Services Fixed Fee (PreliminaryDesign - Bid Support) Construction Administration Support
Please note that Construction Administration Services are NOT optional. We are guided by the CA Architects Practice Act and required by our insurance providers to provide construction administration support. This applies to Architecture and all Engineering services included in the Base & Supplemental Fees.

Required Future ServicesFixed Fee (Construction Administration)

AUBURN I TAHOE CITY I RENO I SAN JOSE
236,130
477,650
750,900
879,600
134,400
56,400
2,535,080
634,100
634, 100
PO Box 7409 I 165 River Road, Tahoe City, CA 96145 530. 583. 9222 www.jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 375

JK ARCHITECTURE

CONSULTANT/ ENGINEERING FEES ( INCLUDED IN COST PROPOSAL ABOVE) Base Services Construction Administration
Structural Design:

Civil/Site Design:

Landscape Design:

Electrical/ Lighting/ Low Voltage:

Mechanical/ Plumbing/ Fire Sprinkler:

Aquatic Design:

Kitchen Design:

Cost Estimating:

Acoustical/ Noise Mitigation Design:

Total Consultant Engineer Fees:
195, 800 $ 54,000
169,000 $ 15,000
93,965 $ 20,000
163, 800 $ 41,200
228,294 $ 42,294
166,500 $ 18,500
12,000 $ 4,000
83,220 NA
15,000 NA
1,127,579 $ 194,994
Please note that we have not marked up any of the consultant services.

SUPPLEMENTAL SERVICES FEES ( INCLUDED COST PROPOSAL ABOVE) Base Services Construction Administration
LEED Consulting:

TRPA & Lahontan Consulting:

CEQA Consulting:

Topographic Survey ( 1 Site):

Geotechnical Engineering ( 1 Site):

Traffic Study:

Total Supplemental Services Fees:
51,000 $ 41,900
78,000 $ 0
75,000 ( budget) $ 0
19,080 $ 0
37,850 so
46,350 so
307 ,280 $ 41,900
Please note that we have not marked up any ofthe supplemental services.

REIMBURSABLE EXPENSES
In addition to our fees for professional services, we charge for project expenses incurred on your behalf. These typically include such items as document scanning & document reproduction and travel associated with in-person Client Team Workshops and Public Meetings ( ideally held on the same day or two). Electronic ( PDF) of all progress deliverables and permit set are included in our base services. We have established a reimbursable budget to cover these anticipated expenses. Note that virtual meetings have significantly minimized this reimbursable expense budget to the extent that virtual meetings will certainly play a role in the planning and project coordination process with the City. Backup will be provided for all expenses invoiced against the reimbursable budget. We have proposed a budget number below and will advise the City if we expect we may exceed this budget to request an increase.

REIMBURSABLE EXPENSES BUDGET
Travel, Mileage, & Related Expenses: $ 19,000
Printing: $ 1000

ADDITIONAL SERVICES
Additional scope may be requested by the City. Any services that are not defined in this agreement may be compensated on an hourly basis or pre-negotiated fixed- fee basis except for Construction Administration Services. Rates are based on our current employee rate schedule. The Fixed Fees indicated above are based on a City- budgeted construction cost of $24.0M. Should the construction budget be increased by 2% or greater due to unforeseen conditions, City request for additional scope, or other reasons, the professional design and engineering fees shall be adjusted upward based on 9.28% of additional budgeted construction costs over $ 24.0M for base services and additional option services and 2.47% of additional budgeted construction costs over $ 24 OM for construction administration services. There shall be no adjustment to fees should the project bid or complete

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530.583.9222 www.jkaedesign. com C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 376

JK ARCHITECTURE
construction below the project budget. Additional services would also include Advanced Signage & Wayfinding Design (based on

0.33/sDas well asAdvancedInteriorDesign (basedon $1.54/sD. This proposal is for one (1) bidpackage for sitework, foundation, and building combined. Additional bid packages, including multiple bid packages for sitework, foundations, or other elements, are not included in this proposal but could be provided for an additional fee.

ASSUMPTIONS ( OTHER SOFT -COST BUDGET ITEMS PAID BY OWNER) Hazardous materials studies/reportsprovided by Owner.

Environmental studies/reports & CEQA oversight provided by Owner.• Other special studies/reports provided by Owner.•
Agency review fees and permit fees paid by Owner.

USGBC fees including all LEED submittal/review, certification, plaque, and other fees paid by Owner.

Special inspections provided by Owner.

Bid advertisementcosts paid by Owner.•
Printing costs of bid sets and construction sets reimbursed by Owner. Note that current practice is to issue electronic PDF) Bid sets. Electronic ( PDF) progress and bid sets are included inJKAE and BRS' base services 2020 Hourly Rate Schedule
Partner
Principal
Associate Principal
Project Manager - Architect
Senior Architectural Designer
Structural Engineer - SE (JKAE)
Senior Architect
Senior JKAE Structural Engineer - PE
Senior JKAE Civil Engineer - PE
Project Engineer ( JKAE)
Project Architect
Senior BIM Designer
Assistant Engineer ( JKAE)
Project Leader I Job Captain
Business Manager
CADD/ BIM/Designer
Marketing
OfficeManager
Studio Assistant
Consultant Services
Reimbursable Expenses
Mileage
Rates subject to change annually

AUBURN I TAHOE CITY I RENO I SAN JOSE
PO Box 7409 / 165 River Road, Tahoe City, CA 96145 530.583.9222 235.00
215.00
190.00
180.00
180.00
175.00
165.00
160.00
160.00
150.00
150.00
135.00
130.00
125.00
115.00
105.00
105.00
100.00 $

70.00 cost plus 10%
cost plus 15% $

0.58 per mile
www.jkaedesign. com
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 377
Project Schedule _
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C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 378

EXHIBIT B

ANTI-LOBBYING CERTIFICATION
Consultant shall submit to City this certification prior to or at the time of the execution ofthis Agreement.

This certificationis a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certificationis a prerequisite formaking or entering into this transaction imposed by Section 1352, Title 31, U. S. Code.

Any person who fails to filethe required certificationshall be subject to a civil penalty not less than $10,000 and no more than $100,000 for such failure.

The undersigned certifies, to the best of his or her knowledge or belief, that:

1. No federal appropriated funds have been paid or will be paid, by or on behalf of it, to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officeror employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement; and

2. If any fundsother than federal appropriated funds have been paid or will be paid to any person forinfluencingor attempting to influencean officeror employee of any agency, a Member of Congress, an officeror employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, cooperative agreement, it will complete and submit Standard Form-LLL, "Disclosure Form to Report Lobbying," in accordance with its instruction.

Name, Title
By:

4.7.1.1 Consultant:

Jordan Knighton, Architect of Record
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 379
ACORD® CERTIFICATE OF LIABILITY INSURANCE I
DATE (MM/DD/YYYY) 8/5/2020 THIS CERTIFICATE IS ISSUED AS A MATIER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVEOR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADD ITIONAL INSURED, the policy(ies) must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement( s). PRODUCER i cT Maurice Thornton Dealey, Renton & Associates _ P.O. Box ri:£NJo Ext•: 800-545-3090 rffcNol: 510-452-2139 12675 Oakland CA 94604 t'DA ss: dracertificates@dealevrenton. com INSURERIS) AFFORDING COVERAGE NAIC# License#: 0020739 INSURER A: Arqonaut Insurance Company I 19801 INSURED JORDKNl- 01 INSURER s: HARTFORD INSURANCE COMPANY 38288 Jordan Knighton Ar chitects, Inc. INSURER c: Sentinel Insurance Company I 11000 11661 Blocker Drive, Suite 220 Auburn CA95603 INSURER D: I INSURER E: I
INSURER F: COVERAGES CERTIFICATE NUMBER: 1982022541 REVISION NUMBER: THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OFSUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. INSR LTR I TYPEOF INSURANCE C MMERCIALGENERALLIABILITY K: ="'
c
ntractual L1ab U Included
R'
L AGGREGATE LIMITAPPLIES PER: POLICY DPRO- JECT 0LOG OTHER: OMOBILELIABILITY ANY AUTO OWNED c---i SCHEDULED AUTOS ONLY ,......._ HIRED j g1? JwNED AUTOS ONLY AUTOSONLY H
UMBRELLA LIAB EXCESS LIAB r-; OCCUR CLAIMS-MADE
I DED I I RETENTIONs B
I
WORKERS COMPENSATION AND EMPLOYERS' LIABILITY Y/ N ANYPROPRIETORIPARTNER/EXECUTIVE OFFICERIMEMBER Mandatoryin NH) EXCLUDED? ( D Ifyes, descnbeunder DESCRIPTION OF OPERATIONS below A IProfessional L1ab1hty

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POLICY EFF POLICY EXP POLICY NUMBER IMM/DD/YYYYl IMM/DD/ YYYYl LIMITS 72SBWBC3209 3/12/2020 3/12/2021 EACHOCCURRENCE S 2.000,000 UAMAGETO REN"1 t:.U S 1,000,000 I PREMISES {Ea occurrence) I
I f MED EXP (Any one person) S 10,000 I
IPERSONAL & ADV INJURY S 2,000,000
I
I
GENERAL AGGREGATE S 4,000,000 : PRODUCTS - COMP/OP AGG I S 4,000,000 s
72SBWBC3209 3/12/2020 3/12/2021 I COMBINED SINGLE LIMIT ! Ea acc1denll S $ 2,000,000 BODILY INJURY (Per person) s BODILY INJURY (Per acadent) s PROPERTY DAMAGE s I
I {Per acc,dent) Is I EACHOCCURRENCE s AGGREGATE s
s
I " WECADOErn 3/12/2020 I
3/12/2021 x I ffTUTE I I H- I
I E.L. EACH ACCIDENT I s $1.000.000 E.L. DISEASE· EA EMPLOYEE! S $ 1,000,000 E.L. DISEASE· POLICY LIMIT S $ 1,000,000 1AE016923600 3/12/2020 3/12/2021 Each Claim $ 2,000,000 AnnualAggregate $ 4,000,000 I I I DESCRIPTIONOFOPERATIONS ILOCATIONS IVEHICLES ( ACORD 101, Additional RemarksSchedule, may be attached ifmore space is required) RE: Project: 20-370 RecreationSwim Complex City of South Lake Tahoe, its elected or appointed officers, officials. employees, agents and volunteers are named as additional insureds as respects general and auto liability as required per written contract or agreement. General Liability is Primary/Non-Contributoryper policy form wording. Insurance coverage includes waiver of subrogation per the attached endorsement( s).

CERTIFICATE HOLDER
Cityof South Lake Tahoe Attn: Jim Marino 1901 AirportRoad South Lake Tahoe CA 96150 CANCELLATION30 Days Notice ofCance ation
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS.

AUTHORIZEDREPRESENTATIVE
71& ©
1988-2015 ACORD CORPORATION. All rights reserved. ACORD 25 (2016/03) The ACORD name and logo are registered marks of ACORD C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 380
POLICY NUMBER: 72SBWBC3209 BUSINESS LIABILITY COVERAGE
SS 00 OE O 05

ADDITIONAL COVERAGES BY WRITTEN CONTRACT, AGREEMENT OR PERMIT This is a summary of the coverage provided under the following form (complete form available):

BUSINESS LIABILITY COVERAGE FORM SS 00 08 04 05
Additional Insured When Required by Written Contract, Written Agreement or Permit WHO IS AN INSURED under Section C. is amended to include as an additional insured, but only with respect to liability for "bodily injury", "propertydamage" or "personal and advertising injury" caused, in whole or in part, by your acts or omissions or the acts or omissions of those acting on your behalf:
a) In the performance of your ongoing operations;
b) In connection with your premises owned by or rented to you; or c) In connection with " your work" and included within the " products completed operations hazard", but only if
i) The written contract or written agreement requires you to provide such coverage to such additional insured; and
ii) This Coverage Part provides coverage for "bodily injury" or "property damage" included within the "products completed operations hazard".

The person(s) or organization( s) are additional insureds when you have agreed, in a written contract, written agreement or because of a permit issued by a state or political subdivision, that such person or organization be added as an additional insured on your policy, provided the injury or damage occurs subsequent to the execution of the contract or agreement, or the issuance of the permit.

A person or organization is an additional insured under the provision only for that period of time required by the contract, agreement or permit.

With respect to the insurance afforded to the additional insured, this insurance does not apply to: "Bodily injury", property damage" or " personal and advertising injury" arising out of the rendering of, or failure to render, any professional architectural, engineering or surveying services, including:
a) The preparing, approving, or failure to prepare or approve, maps, shop drawings, opinions, reports, surveys, field orders, change orders, designs or drawings and specification: or b) Supervisory, inspection, architectural or engineering activities.

The limits of insurance that apply to additional insureds are described in Section D. Limits Of Insurance.

How this insurance applies when other insurance is available to an additional insured is described in the Other Insurance Condition in Section E. Liability And Medical Expenses General Conditions.

No person or organization is an insured with respect to the conduct of any current or past partnership, joint venture or limited liability company that is not shown as a Named Insured in the Declarations.

Other Insurance
If other valid and collectible insurance is available for a loss we cover under this Coverage Part, our obligations are limited as follows:

When You Add Others As An Additional Insured To This Insurance: That is other insurance available to an additional insure d. However, the following provisions apply to other insurance available to any person or organization who is an additional insured under this Coverage Part:
a) Primary Insurance When Required By Contract: This insurance is primary if you have agreed in a written contract, written agreement or permit that this insurance be primary. If other insurance is also primary, we will share with all that other insurance by the method described in c. below.
b) PrimaryAnd Non-Contributory To Other Insurance When Required By Contract: If you have agreed in a written contract, written agreement or permit that this insurance is primary and non-contributory with the additional insured's own insurance, this insurance is primary and we will not seek contribution from that other insurance.

Rev E, 14 Page 1 of 2
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 381
BUSINESS LIABILITY COVERAGE FORM Summary SS 00 08 04 J
Paragraphs ( a) and (b) do not apply to other insurance to which the additional insured has been added as an additional insured.
c. Method Of Sharing
If all the other insurance permits contribution by equal shares, we will follow this method also. Under this approach, each insurer contributes equal amounts until it has paid its applicable limit of insurance or none of the loss remains, whichever comes first.

If any of the other insurance does not permit contribution by equal shares, we will contribute by limits. Under this method, each insurer' s share is based on the ratio of its applicable limit of insurance to the total applicable limits of insurance of all insurers.

Waiver of Subrogation
If you have waived any rights of recovery against any person or organization for all or part of any payment, including Supplementary Payments, we have made under this Coverage Part, we also waive that right, provided you waived your rights of recovery against such person or organization in a contract, agreement or permit that was executed prior to the injury or damage
EXCERPT FROM Hartford Form SS 04 38 09 09

HIRED AUTO AND NON- OWNED AUTO
B. With respect to the operation of a "non- owned auto", WHO IS AN INSURED is replaced by the following: The following are "insureds":
d. Anyone liable for the conduct of an "insured", but only to the extent of that liability Rev 5.14 Page 2 of 2
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 382
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

WAIVER OF OUR RIGHT TO RECOVER FROM

OTHERS ENDORSEMENT- CALIFORNIA
Policy Number: 57WECADOETR Endorsement Number:

Effective Date: 03/12/2020 Effective hour is the same as stated on the Information Page of the policy.

Named Insured and Address: Jordan Knighton Architects. Inc. 11661 Blocker Drive. Suite 220
Auburn, CA 95603
We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedule. ( This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule.

The additional premium for this endorsement shall be 2 % of the California workers' compensation premium otherwise due on such remuneration.

SCHEDULE
Person or Organization Job Description
Any person or organization from whom you are required by written contract or agreement to obtain this waiver of rights from us
Form WC 04 03 06
Countersigned by --------------------,=------,--
Authorized Representative
1) Printed in U.S.A.

Policy Expiration Date: 03/12/2021
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 383
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

NOTICE OF CANCELLATION TO CERTIFICATE HOLDER(S)
This policy is subject to the following additional Conditions:

A. If this policy is cancelled by the Company, other
than for non-payment of premium, notice of such
cancellation will be provided at least thirty ( 30) days in advance of the cancellation effective date to the
certificate holder( s) with mailing addresses on file
with the agent of record or the Company.

B. If this policy is cancelled by the company for nonpayment of premium, or by the insured, notice of such cancellation will be provided within ten ( 10)
days of the cancellation effective date to the
Form SS 12 24 0611
certificate holder( s) with mailing addresses on file
with the agent of record or the Company.

Any notification rights provided by this endorsement
apply only to active certificate holder( s) who were issued a certificate of insurance app licable to this policy' s term.

If notice is mailed, proof of mailing to the last known mailing address of the certificate holder( s) on file with the agent of record or the Company will be sufficient
proof of notice.

Page 1 ends

2011, The Hartford
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 384
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.

NOTICE OF CANCELLATION TO CERTIFICATE HOLDER(S)
Policy Number: 57WECADOETR Endorsement:

Effective Date: 03/12/2020 Effective hour is the same as stated on the Information Page of the policy.

Named Insured and Address: Jordan Knighton Architects, Inc. 11661 Blocker Drive, Suite 220
Auburn, CA 95603
This policy is subject to the following additional
Conditions:

A. If this policy is cancelled by the Company, other
than for non- payment of premium, notice of such
cancellation will be provided at least thirty ( 30)
days in advance of the cancellation effective
date to the certificate holder( s) with mailing
addresses on file with the agent of record or the
Company.

B. If this policy is cancelled by the Company for
non- payment of premium, or by the insured,
notice of such cancellation will be provided
within ten ( 10) days of the cancellation effective
date to the certificate holder( s) with mailing
addresses on file with the agent of record or the
Company.

Form WC 99 03 94 Printed in U.S.A.

Process Date: 8/5/2020
If notice is mailed, proof of mailing to the last known mailing address of the certificate holder( s) on file
with the agent of record or the Company will be
sufficient proof of notice.

Any notification rights provided by this endorsement
apply only to active certificate holder( s) who were
issued a certificate of insurance applicable to this
policy' s term.

Failure to provide such notice to the certificate
holder( s) will not amend or extend the date the
cancellation becomes effective, nor will it negate
cancellation of the policy. Failure to send notice
shall impose no liability of any kind upon the
Company or its agents or representatives.

Policy Expiration Date: 0311212021
2011, The Hartford
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 385

CITY OF SOUTH LAKE TAHOE BUSINESS AND PROFESSIONS TAX NEW

APPL/ CATION FORM
Fiscal Year July 1, 2020 to June 30, 2021
If located within the city limits
you must submit an approvedZoning/ Building Application form BUSINESS NAME: . JordanKnighton Architects, Inc ( dba JK Architecture Engineering) BUSINESS TYPE: (Describe the exact nature of the business to be conducted):Architecture & Engineering Professional Services BUSINESS PHYSICAL LOCATION, CITY, STATE, ZIP: 165 River Road, Tahoe City, CA 96145 List address where individual consents to receive Serviceof Process per AB2184, Sec16000 1( a)(2) and 16100 1 (a)(2)) BUSINESS PHONE: 530-888-0998----------------------------------- BUSINESS EMAIL ADDRESS: anda@jkaedesign. com------------------------------- BUSINESS MAILING ADDRESS !! ( If different from the Service of Process business address) NAME: Derek Labrecque
STREET/ PO BOX: 11661 Blocker Drive, Suite 220
CITY STATE ZIP Auburn, CA 95603' ' ·----------------------------------- STATE EMPLOYER ID# C 3 65928 ______ FEDERAL EMPLO YERU# 4 6--= 5=25 4=2=04 CALIFORNIASTATE SELLERSPERMIT#( REQUIRED FOR RET.Al.SlllES) ____________ _ CALIFORNIA STATE LICENSE# AND CLASS C30650 - Architect (Derek Labrecque) CONTRACTOR, MASSAGE THERAPIST, BARBERING AND COSMETOLOGY, PROFESSIONAL, ETC.)

TAX COMPUTATION

1. ESTIMATEDGROSS RECEIPTS . $1,000MINIMUM _________________ 1. $300 000

2. TAXRATE IS 2 .69 PER $1,000OF TAXABLE GROSSBASED ON BUSINESS a..ASSH)\ JTQ\

3. TOTAL TAX (LINE 1DIVIDEDBY 1,000THEN MULTIPLIEDBYRATE FROMLINE 2) $ 19,928.00 MAXIMUM 3. $ 807.00

4. $6 2.00ADMINISTRATIVE+$ 10.00TECHNOLOGYFEE: _________________ _,_ 4. $ 72.00

5. SUBTOTAL( ADD LINES 3+4)$20,000MAXIMUM 5.$ 879.00

6. STATE MANDATED DISABILTYACCESS AND EDUCATION FEE 6. $ 4.00

7. TOTALBUSINESS AND PROFESSIONSTAX (ADD LINES 5+6)$ 20,004MAXIMUM 7. $883 .00 SPECIAL FEE SECTION***
Ski Run Business Improvement District (SRBID) & Ski Run FrontageFee Assessment ( Business addresses 1000 -1236SkiRunBlvd & 3668Lake TahoeBlvd)

8. 25%0FTOTAL TAX DUE( LINE 5MULTIPLIED BY 0.25) _________________ -= 8. $ _______ _

9. FRONTAGEFEEBASED ON LINEARFOOT MEASUREMENT FROM ASSESSORS'SPARCEL MAP 9 . $ _______ _ Multi-Family Dwelling/Single Room Occupancy Ordinance (MFD/SRO)

10. MFD$ 88.00TIMES NUMBER OF UNITS ( 6OR MORE UNITS) _____________ -'-"- 10. $ ______ _

11.SR0$ 88.00TIMES NUMBER OF SRO UNITS 11. $ ______ _
Storm Water Inspection Fee per SLTCC § 7.15

12. $ 227.00FORCOMMERICALAND $ 285.00FORINDUSTRIAL 12. $ ______ _

13. TOTAL DUE (ADD LINES 7THROUGH 12) _____________________ 1=3. $ _______ _

NOTICE TO ALL BUSINESS & PROFESSIONS TAX APPLICANTS
Please be advised that in accordance with CityCode § 6.55.020, no use that is illegal under local, state, orfederal law shall be allowed within the City of South Lake Tahoe.

Pursuant to City Code§ 3.35.090 (A), the exact nature or kind of business for which a business certificate is requested must be furnished to the City of South Lake Tahoe.

I will not be selling, distributing, or providing any illegal or controlled substance, including, but not limited to, marijuana, as to do so violates STLCC § 6. "
DATE July 28, 2020
SEE REVERSE SIDE FOR TAX COMPUTATION INSTRUCTIONS**
BL New App rev 05/21/20
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 386

BUSINESS ANDPROFESSIONS TAX COMPUTATION INSTRUCTIONS
FINANCE DEPT/ REVENUE DIVISION 1901 Lisa Maloff Way SUITE 210, SOUTH LAKE TAHOE CA 96150 PHONE 530-542-6012 / FAX 530-542-6041 [email protected] I WWW.CITYOFSLT.US

NEW BUSINESS LICENSE APPLICANTS
Line # 1. ESTIMATE your gross receipts for your business from your business start date to the end of the fiscal year ( June 30). The business license fiscal year is July 1 to June 30. Round to the nearest $ 1,000. $1,000 minimum. Gross receipts are your income before expenses.

Line #2. Determine your tax rate schedule by your type of business, as follows:

Schedule A ($1.07 per thousand of gross): retail sales, restaurants, auto repair shops & print shops.

Schedule B ($1.62 per thousand of gross): janitorial, motels, real estate, massage therapy, general contractors ( with only class A or Class B Contractor' s License- no Class C or D license), computer service, consulting ( without a degree) and baby- sitting.

Schedule C ($2.14 per thousand of gross): hairdressers, salons, taxi service, child care ( State licensed for more than six children) and specialty building contractors ( with Class C or D Contractor' s license).

Schedule D ($2.69 per thousand of gross): dentists, physicians, attorneys, civil engineers, optometrists. chiropractors, consultants ( with degrees), and schools of instruction.

If your business is not shown, call (530) 542-6012 and a rate schedule will beassigned.

Line # 3. Divide Line 1 by 1000, then multiply the result by the Tax Rate from Line 2.

Line #4 & 6 are prefilled.

Line #5 & 7 are math.

Line #8. Ski Run Business Improvement District Fee: 25% of total tax due ( total from Line # 5 multiplied by 0.25). Applies to those businesses on Ski Run Blvd with business addresses 1000- 1236 Ski Run Blvd & 3668 Lake Tahoe Blvd.

Line #9. SRBID Frontage Fee: $ 2.00 Per Linear Foot of property fronting on Ski Run Blvd. Measurementfrom Assessor'sParcel Map.

Line #10. Multi- Family Dwelling Ordinance MFD: Call Lyd ia Zuniga 530-542-7417 with questions.

Line # 11. Single Room Occupancy SRO: Call Lydia Zuniga 530-542-7417 with questions.

Line #12. Storm Water Inspection Fee per SLTCC § 7.15: Call Jason Burke ( 530) 542-6038 with questions.

Line #13. Total Due: Add Lines 7 through 12. This is the TOTAL Business and Professions Tax Due.

Please note you are required to notify the Business License Department of an changes regarding your business information.

All City business licenses expire on June 30th of each year. Do not forget to sign the Application.

INCOMPLETE APPLICATIONS, FAILURE TO PAY SPECIAL ASSESSMENTS (SRBID, MFD, SRO, STORM WATER), OR FAILURE TO SIGN WHERE INDICATED WILL DELAY THE ISSUANCE OF YOUR CERTIFICATE.

BUSINESS OWNER/ CORPORATION INFORMATION
CHECK BOX INDICATING TYPE OF BUSINESS OWNERSHIP: 0 OTHER: ______________ _ O SOLE PROPRIETORSHIP ( COMPLETE SECTION 1) CORPORATION ( COMPLETE SECTION 2) 0 PARTNERSHIP ( COMPLETE SECTION2) SECTION 1 - ONLY FOR SOLE PROPRIETORSHIP
NAME: _______________________ TITLE
l NOT PUBLIC INFORMATION U
BUSINESS ADDRESS OR SERVICE OF PROCESS ADDRESS: ---------------- CITY _____________ = ST: ____ ZIP: _______________ _
RESIDENCE PHONE _______ ss #, DRIVER LICENSE#, OR OTHER ID--------- SECTION 2 - COMPLETE FOR ALL OFFICERS OR PARTNERS
CORPORATION/ LLC/PARTNERSHIP NAME: Jordan Knighton Architects, Inc. ---------------------------

U NOT PUBLIC INFORMATION U
OFFICER OR PARTNER NAME: Derek Labrecque TITLE: CEO/President -------------- BUSINESS ADDRESS OR SERVICE OF PROCESS ADDRESS: 11661 Blocker Drive, Suite 220 CITY: Auburn ST: CA ZIP 95603 ----------
BUSINESS PHONE: 530-888-0998 ------------
OFFICER OR PARTNER NAME Chris Vicencio TITLE: Vice President/ Secretary BUSINESS ADDRESS OR SERVICE OF PROCESS ADDRESS 11661 Blocker Drive, Suite 220 CITY: Auburn ST: CA ZIP 95603 ----------
BUSINESS PHONE: 530-888-0998 ------------
OFFICER OR PARTNER NAME: Jordan Knighton TITLE: Director ----------------- 8USINES S ADDRESS OR SERVICE OF PROCESS ADDRESS 165 River Road --------------------- CITY: Tahoe City ST: CA ZIP:_9_6 _14_5 _______ _
BL New App rev 05/21/20
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 387

CITY OF SOUTH LAKE TAHOE, CALIFORNIA

BUSINESS AND PROFESSIONS TAX CERTIFICATE

THIS CERTIFICATE MUST BE

POSTED IN A CONSPICUOUS PLACE

NON- TRANSFERABLE
The granting ofthis certificatedoes not
mean approval of the operation of your
business in violation of any provisions of
the City Code or any State Law.

ISSUED TO: TAX NO: 008282
JK ARCHITECHTURE ENGINEERING EXPIRES: 06/30/2017

JORDAN KNIGHTON ARCHITECTS INC
165 RIVER RD
LICENSED ARCHITECT C26985
Detach at perforations and display in a conspicuous place.

ORIGINAL DOCUMENT HAS A COLORED BACKGROUND. ANO IS PRINTED WITH COPY DETERRENT TECHNOLOGY.

USJ?OS! AGE ,.,.:

CITY OF SOUTH LAKE TAHOE

BUSINESS LICENSES
1901 AIRPORT ROAD, SUITE 210
SOUTH LAKE TAHOE, CA 96150-7004
ZIP 9f
041L11
RETURN SERVICE REQUESTE[

JORDAN KNIGHTON ARCHITECTS INC

JK ARCHITECH TURE ENGINEERING
11661 BLOCKER DRIVE STE 220
ABURN , CA 95603
C-084-2020
DocuSign Envelope ID: 8349D1DE- A2A3-4DA4-AFFB- 37CEC0055C90 388

LETTER OFAUTHORIZATION TOPROCEED
Contract Amendment 01 Scale & Scope Increase
DATE: RevisedDecember 23, 2020
CLIENT: CityofSouthLakeTahoe
JOB#: 20-370
PROJECT: Recreation Center
Wearepleased topresenttoyouourrevisedfeeproposalfortheexpanded scopeandconstruction hardcostonthis project. Wehaveendeavored tokeepthefeecompetitive whilemaintaining comprehensive services. Youwillnote thattheoverallfee, asapercentage ofconstruction cost, hasbeenreduced asyoushouldexpect. Weareconfident thefeeandscopeofservices isappropriate todeliverthelevelofdesignandengineering thattheCityand community expectsonapublicfacilityofthisscaleandmagnitude.

PROJECTAMENDMENT
Inaccordance withtheProfessional ServicesAgreement fortheabove-mentioned project, datedJuly28, 2020, this LetterofAuthorization toProceed confirms thefollowing amendment tothecontract:

ContractAmendment 01: Scale & ScopeIncrease ThescaleandscopeofthenewCityofSouthLakeTahoe Recreation Centerhasbeenincreased bytheCitytoaProjectBudgetof $48.0Mconsisting ofaconstruction hard costbudgetofapproximately $42.5Mandsoftcostbudgetof $5.5M.

SCHEDULE AMENDMENT
Phase Original Schedule Revised Schedule
Programming & ConceptDesign 08/01/2020 12/31/2020 08/01/2020 01/15/2021 Schematic Design 01/01/2021 03/31/2021 01/15/2021 03/31/2021 Design Development 05/01/2021 07/31/2021 04/15/2021 08/15/2021 Construction Documents 09/01/2021 11/30/2021 09/01/2021 12/31/2021 AgencyReview 12/01/2021 02/28/2022 01/01/2022 03/31/2022 BidSupport 03/01/2022 04/30/2022 04/01/2022 05/31/2022
Construction Administration 17Months StartJuly2022

FEEAMENDMENT
BasicServices Original Adjustments Revised
Programming & ConceptDesign $ 236,130.00 $ 135,900.00 $ 372,030.00 Schematic Design $ 477,650.00 $ 178,100.00 $ 655,750.00 Design Development $ 750,900.00 $ 409,455.00 $ 1,160,355.00 Construction Documents $ 879,600.00 $ 450,699.00 $ 1,330,299.00 AgencyReview $ 134,400.00 $ 36,205.00 $ 170,605.00
BidSupport $ 56,400.00 ($ 17,031.00) $ 39,369.00
TOTALS $ 2,535,080.00 $ 1,193,328.00 $ 3,728,408.00
FutureServices Original Adjustments Revised
Construction Administration $ 634,100.00 $ 165,448.00 $ 799,548.00 TOTALS $ 634,100.00 $ 165,448.00 $ 799,548.00
AUBURN | TAHOECITY | RENO | SANJOSE IMAGINE | DESIGN | C-010- CREATE 2021 165RiverRoad, Suite1, TahoeCity, CA96145 530.583.9222 www.jkaedesign.com 389
Amended Consultant/Engineering Fees (included inabovefeeproposal) Note: JKAEdidnotmarkuptheseservices.

Structural
Civil/Site
Landscape
Electrical/Lighting/LowVoltage
Mechanical/Plumbing/FireProtection
Aquatic
Kitchen/Foodservice
CostEstimating
Acoustical/NoiseMitigation
Supplemental Services Fees (included inabovefeeproposal) Thefollowing supplemental servicesareincluded, andfeeshavenotchanged fromtheProfessional Services Agreement.

LEEDConsulting
TRPA & Lahontan Consulting
CEQAConsulting
Topographic Survey (1site)
Geotechnical Engineering (1site)
TrafficStudy

REIMBURSABLE EXPENSES AMENDMENT
Therearenoreimbursable expenses currently anticipated onthisproject. Expenses already included inourfee consistoftraveltothejobsite, printingfordesignteamcoordination purposes, phone, andincidental expenses incurred fromtraveltojobsite. Otherowner-paidexpenses areoutlined inAdditional Services & Assumptions per ExhibitAoftheProfessional ServicesAgreement. Specialrequests suchasprintingfordistrictreviews, community functions, orspecialeventsarenotincluded inthisproposal butmayberequested asareimbursable expense.

Ownermayalsorequest specialtravelthatisnotincluded inthisproposal suchasvisitstootherprojects, FF&E vendors, orotherrelatedtravel; allofwhichwillberequested asreimbursable expenses.

CONSTRUCTION ADMINISTRATION
Weunderstand theCityhaschosentoapprove construction administration services andfeesastheproject progresses. Theproposed feeistheamountourdesignandengineering teamrequires toprovidethenecessary services required bytheStandard ofCareweareobligated toprovidebytheCity, ourinsurance providers, and licensingorganizations. ThisfeewillallowustoassisttheCityinadministering thecontract forconstruction asa complex construction projectunderCalifornia public contractcode. Thefeeamount forConstruction Administration hasbeencarefully established byourteam. TheCityagreesthatthisamount shallnotberenegotiated unlessthe scopeofconstruction administration services isincreased ormodified bymutualagreementbytheCityorby unforeseen circumstances.

C-010-2021
CityofSouthLakeTahoeRecCenter Amend01 Page | 2of3
390

CONTRACT NOTE
Otherthantheabove, nothinginthisAmendment isintended toamendorreviseanyofthecontract provisions for theexecutedProfessional ServicesAgreement.

Pleasereviewandletmeknowifyouhaveanyquestions. Wewouldbehappytowalkyouthroughthisproposal and answeranyquestions youmayhave.

Sincerely: Approved:

JordanKnighton, Partner, C15848 Client Date
JKArchitecture Engineering
PrintName/Title
C-010-2021
CityofSouthLakeTahoeRecCenter Amend01 Page | 3of3
391
From: ChrisVicencio
To: JimMarino
Cc: Jordan Knighton; AndaGrenfell
Subject: SLTRecCenter - JKAEWorkplan/FeeFollow Up
Date: Saturday, January 09, 2021 11:02:22AM
Attachments: 20-370Amendment 01REV12.23.20R1.pdf
Hello Jim,
Aswementioned earlier thisweek, wearecommitted toanswering any questions youandtheCity Council have onour fee & approach. Werecommend thatweschedule adiscussion forearly next week towork through allofyour questions and provide youwith theunderstanding ofhow weareapproaching thedesign and fees forthisproject. We corrected theclerical errors ontheFee Amendment, attached. ThefeeAdjustments column total forBasic Services went down to $1,193,328.

Here issome additional analysis thatwethink willhelp inyourreview ofourfee. Weshared with youpreviously the phase-by-phase and consultant-byconsultant hours breakdowns that explain how weare planning the project and how weputthesubsequent feetogether. This essentially gives theCityabreakdown ofourteam’soverall workplan forthe project showing oureffort foreach phase. This isavery detailed assessment ofhowweintend todeliver the Architecture andEngineering services forthisproject. Ourteam isconfident wehave theeffort accurately identified to deliver this project appropriately and economically.

While wehaven’tsetourfees based onapercentage ofconstruction cost, itmay behelpful tocompare thefees against total construction cost. The chart below shows youhow ourfeebreaks down between BASE feeandSPECIALTY consultant fees. Asyouknow thespecialty consultants arethose consultants who would typically behired directly by theCity andwouldn’tnormally beincluded inouroverall fee. Forthis reason, weareshowing afeepercentage calculation excluding these specialty consultants. Youwill see inthespreadsheet below thatouroverall feepercentage isdown below 10% (9.83%) andourfee percentage through thephase 1services isdown to8% (8.05%).

Foraproject ofthisscale and complexity, atotal feeunder 10% isextremely competitive. This feeincludes anumber ofinternal specialty consultants, such asAquatics Design/Engineering, Acoustics Design, andKitchen Design, that historically arenot included inBase services. Infact, programming itself isnottypically included inbase services. We state thisasanother example ofthevalue ourteam isbringing tothis project. Taking thisallintoconsideration, we believe ourfeeishighly competitive and provides anextraordinary value fortheCity. Projects ofthis scale and complexity, with theadditional consultants wehave included inourbase fee, would traditionally result inan Architecture/Engineering feeof11-12% ormore. Westand strongly behind ourfeeasappropriate totherequired workplan forthisproject and asvery good value totheCity andCommunity.

BASEComparisonSPECIALTY TOTAL Architecture & Percentage Survey, Traffic, EngineeringAgainst $ 42.5MTRPA, CEQA, COMBINED
Construction CostGeotech, LEED FEE
Predesign/Program$ 361,500$ 10,530$372,030
Schematic Design$ 516,500$ 139,250$655,750
Design Development$ 1,114,455$ 45,900$1,160,355
Construction Documents$ 1,296,699$ 33,600$1,330,299
Agency Review$ 92,605$ 78,000$170,605
BidSupport$ 39,369$ 0$39,369
PHASE 1SubTotal (Prior toCA
Services)$ 3,421,1288.05%$ 307,280$3,728,408
Construction Administration$ 757,648$ 41,900$799,548
TOTALS$ 4,178,7769.83%$ 349,180$4,527,956
C-010-2021 392
Let’sregroup early next week and discuss further toclarify anyadditional questions youmay have.

LETTER OF AUTHORIZATION TO PROCEED
Contract Amendment 02 – Site & Building Packages (OPTION B) DATE: August 4, 2021 Revised August 19, 2021
CLIENT: City of South Lake Tahoe
JOB#: 20-370
PROJECT: Recreation Center
Please find herein our proposed contract amendment for Architecture, Engineering, and Supplemental Services based on adjustments to the project’ s construction document packaging and construction sequencing.

PROJECT AMENDMENT
In accordance with the Professional Services Agreement for the above- mentioned project, dated July 28, 2020, this Letter of Authorization to Proceed confirms the following amendment to the contract:

Contract Amendment 02: Construction Document Packaging, Construction Sequencing revisions, and associated design and engineering.

SCHEDULE AMENDMENT
Phase Previous Schedule Revised Schedule
Programming & Concept Design 08/01/2020 – 01/15/2021 NA Schematic Design 01/15/2021 – 03/31/2021 NA
Design Development 05/01/2021 – 07/31/2021 08/18/2021 – 11/17/2021 (13 wks) Construction Documents ( Site)
Construction Documents ( Building)
09/01/2021 – 11/30/2021
Same as above
12/8/2021 – 02/11/2022 (9 wks)
12/8/2021 – 03/11/2022 (13 wks)
Agency Review ( Site)
Agency Review ( Building)
1/1/2022 – 3/31/2022
Same as above
02/14/2022 – 04/15/2022 (8 wks)
03/14/2022 – 05/13/2022 (8 wks)*
Note: Agency Review for Building
completion could range from 8 up to
16 weeks potentially completing as
late as 07/08/2022.

Bid Support ( Site)
Bid Support ( Building)
04/01/2022 – 5/31/2022
Same as Above
04/19/2022 – 05/19/2022 (4 wks)
05/26/2022 – 6/30/2022 (5 wks)**
Note: beginning of Bid Suport
phase could range from 05/26/2022
to 07/21/2022 depending on when
Agency Review phase completes.

Construction Administration ( Site)
Construction Administration ( Bldg)
17 months
Same as Above
Start Late May 2022
Start Mid May 2023
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 394
City of South Lake Tahoe Rec Center – Amend 02 – OPTION B Page | 2 of 4

FEE AMENDMENT
Basic Services Current (Amend #1) Adjustments
Amend #2)
Revised
Programming & Concept Design $ 372,030.00 $ 0.00 $ 372,030.00 Schematic Design $ 655,750.00 $ 0.00 $ 655,750.00
Design Development $ 1,160,355.00 $ 42,940.00 $ 1,203,295.00 Construction Documents $ 1,330,299.00 $ 52,480.00 $ 1,382,779.00 Agency Review $ 170,605.00 $ 35,100.00 $ 205,705.00
Bid Support $ 39,369.00 $ 28,520.00 $ 67,889.00
TOTALS $ 3,728,408.00 $ 159,040.00 $ 3,887,448.00
Future Services Current (Amend #1) Adjustments
Amend #2)
Revised
Construction Administration $ 799,548.00 $ 55,880.00 $ 855,428.00 TOTALS $ 799,548.00 $ 55,880.00 $ 855,428.00
PHASE- BY-PHASE AMENDED SCOPE DESCRIPTION:

Design Development:
o Initial division of facility design and drawing set into site and building packages. o Preliminary permit review agency coordination of site and building package approach and strategy o Coordination and sequencing with TRPA for a single permit approval that overlaps two construction packages.
o Additional effort associated with utility routing and path of travel coordination between phases.

Construction Documents:
o Final coordination of site and building packages in preparation for permit review o Separate project specification packages for site and building packages o Coordination of City’s front-end bid documents for site and building packages o Additional Civil Engineering efforts associated with final paving/ sidewalks to be included as part of building package scope.
o Utility coordination associated with maintaining existing operations through phased development until permanent switch over can occur.

Agency Review
o Separate building department permit submittals for site and building packages o Separate permit agency coordination and plan-check responses for site and building packages Bidding
o Additional project bid for two separate bid packages
Additional pre-bid meeting( s)
Additional RFI period
Additional Addenda issuance
Additional Bid opening
Additional Review of bids
Construction Administration
o Additional Construction Administration over revised construction duration. o Construction Administration of two separate contracts for construction. o Team remobilization for phase 2 construction.
o Project Closeout of two separate contracts for construction.

DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 395
City of South Lake Tahoe Rec Center – Amend 02 – OPTION B Page | 3 of 4 AMENDED DESIGN TEAM PHASE 1 FEES ( PRIOR TO CONSTRUCTION ADMINISTRATION):

Architectural:
o Design Development Phase: $ 37,400
o Construction Document Phase: $ 39,400
o Agency Review $ 24,000
o Bid $ 25,000
Sub Total: $ 125,800
Structural:
o Design Development Phase: $ 12,000
o Construction Document Phase: $ 5,000
Sub Total: $ 17,000
Civil/Site:
o Design Development Phase: $ 8,000
o Construction Document Phase: $ 20,000
o Agency Review $ 10,000
o Bid $ 2,000
Sub Total: $ 40,000
Electrical/ Lighting/ Low Voltage:
o Design Development Phase: $ 4,500
o Construction Document Phase: $ 4,900
o Agency Review Phase $ 1,100
o Bid $ 900
Sub Total: $ 11,400
Mechanical/ Plumbing/ Fire Protection:
o Design Development Phase: $ 4,340
o Construction Document Phase: $ 4,960
o Bid $ 620
Sub Total: $ 9,920
Cost Estimating ( Credit for Deletion of Cost Estimating Services)***:
o Design Development Phase: ($ 23,300)
o Construction Document Phase: ($ 21,780)
Sub Total: ($ 45,080)
Note: Design team will coordinate cost estimates with City’s Construction Manager.

TOTAL AMENDED DESIGN TEAM PHASE 1 FEES:

Design Development Phase $ 42,940
Construction Document Phase $ 52,480
Agency Review Phase $ 35,100
Bid Phase $ 28,520
Total Additional Phase 1 Fee****: $ 159,040
Note, there has been no change to scope or fee for the following consultants:
o Landscape Design
o Pool Design
o LEED Consultant
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 396
City of South Lake Tahoe Rec Center – Amend 02 – OPTION B Page | 4 of 4

CONSTRUCTION ADMINISTRATION
We understand the City/client has chosen to approve construction administration services and fees at a later date as the project progresses.

CA Phase Fee Adjustment: $ 55,880
Total CA Phase Fee:

Current CA Fee (Amend. #1): $ 799,548
CA Phase Fee Adjustment ( Amend. #4): $ 55,880
Total: $ 855,428
Phased Fee Breakdown by Construction Phase:

Site (Phase 1) 20% $ 171,086
Building ( Phase 2) 80% $ 684,342
Total: $ 855,428
ASSUMPTIONS/ RECOMMENDATIONS:

We recommend that the site development package be completed and the site GC as-built and survey phase 1 site work so that this information may be provided to the GC who is selected to perform the building phase of the project.

Each phase of construction to be bid as separate public bid.

Given the approximate one-year time delay between commencement of initial site construction and construction on the building portion of the project, it is possible that the CPT may experience some staffing transition( s) or have other reasoning for making changes to the design. Our team will continue to respond to meet your goals and vision. We would like to clarify that in circumstances like this, design revisions after the project is permitted and bid would be performed on an additional- services basis and would have schedule, and likely cost, impacts to the project.

CONTRACT NOTE:

Other than the revised scope and fees as outlined above, nothing in this Amendment is intended to amend or revise any of the contract provisions for the executed Professional Services Agreement.

Please review and let me know if you have any questions. We would be happy to walk you through this proposal and answer any questions you may have.

Sincerely: Approved:

Chris Vicencio, Partner, C26985 Client Date
JK Architecture Engineering
Print Name/Title
Tamara Wallace, Mayor, City of South Lake Tahoe
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 9/ 13/ 2021
397
AUBURN | TAHOE CITY | RENO | SAN JOSE
165 River Road, Suite 1, Tahoe City, CA 96145 530. 583. 9222 www. jkaedesign. com IMAGINE | DESIGN | CREATE

LETTER OF AUTHORIZATION TO PROCEED
Contract Amendment 04 – Additional Survey and Backup Generator System Design DATE: August 4, 2021 Revised August 19, 2021
CLIENT: City of South Lake Tahoe
JOB#: 20-370
PROJECT: Recreation Center
Please find herein our proposed contract amendment for additional Architecture & Engineering of Emergency Backup Generator System at Client request and Supplemental Services for Topographic Survey.

PROJECT AMENDMENT
In accordance with the Professional Services Agreement for the above- mentioned project, dated July 28, 2020, this Letter of Authorization to Proceed confirms the following amendment to the contract:

Contract Amendment 04: Architecture & Engineering of Emergency Backup Generator System and Supplemental Services for Topographic Survey.

Schedule: The amended schedule as shown in Contract Amendment # 02 governs with no additional schedule modifications for Contract Amendment # 04.

FEE AMENDMENT
Basic Services Current (Amend #1) Adjustments
Amend #4)
Revised
Programming & Concept Design $ 372,030.00 $ 0.00 $ 372,030.00 Schematic Design $ 655,750.00 $ 0.00 $ 655,750.00
Design Development $ 1,160,355.00 $ 30,767.00 $ 1,191,122.00 Construction Documents $ 1,330,299.00 $ 3,200.00 $ 1,333,499.00 Agency Review $ 170,605.00 $ 0.00 $ 170,605.00
Bid Support $ 39,369.00 $ 0.00 $ 39,369.00
TOTALS $ 3,728,408.00 $ 33,967.00 $ 3,762,375.00
Future Services Current ( amend #1) Adjustments
Amend #4)
Revised
Construction Administration $ 799,548.00 $ 1,600.00 $ 801,148.00 TOTALS $ 799,548.00 $ 1,600.00 $ 801,148.00
PHASE-BY-PHASE AMENDED SCOPE DESCRIPTION:

Design Development – $ 30,767 increase
o DD level development of Emergency Backup Generator design at Client request $3,200 o Topographic Survey ( 1 site) $27,567
The design team, as a convenience for the City, took on the supplemental services scope of work and fees under our contractual services agreement with the City. The City traditionally would contract directly with the consultants for these services. The original budget allocation for Topographic Survey was $19,080. The actual costs for topographic survey are $46,647. This results in a delta of $27,567. See attached add-services requests from the surveyor/ Psomas ( Exhibit A). As the additional survey information will be required for the execution of the project design and permitting, the design team has included in this amendment proposal the additional topographic survey costs. Note that no DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 398
City of South Lake Tahoe Rec Center – Amend 04 Page | 2 of 2 design-team markup has been added to this additional fee. To be invoiced 100% in early design development phase once complete.

See Exhibit B for overlay of topographic surveys described in this proposal.

Construction Documents - $ 3,200 increase
o CD level development of Emergency Backup Generator design Construction Administration - $ 1,600 increase
o Additional Construction Administration of Emergency Backup Generator System o We understand the City/Client has chosen to approve construction administration services and fees at a later date as the project progresses.

Construction Administration Phased Fee Breakdown
Site (Phase 1) 20% $ 160,230
Building ( Phase 2) 80% $ 640,918
Total: 100% $ 801,148
CONTRACT NOTE:

Other than the revised scope and fees as outlined above, nothing in this Amendment is intended to amend or revise any of the contract provisions for the executed Professional Services Agreement.

Please review and let me know if you have any questions. We would be happy to walk you through this proposal and answer any questions you may have.

Sincerely: Approved:

Chris Vicencio, Partner, C26985 Client Date
JK Architecture Engineering
Print Name/Title
Tamara Wallace, Mayor, City of South Lake Tahoe
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 9/ 13/ 2021
399
400
401
402
403
404
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 405
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 406
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 407
MH
MH
MH
MH
MH
MH
MH
MH
MH
MH
HB
HB
HB
HB
HB
HB
HB
HB HB
HB
HB
HB
HB
EX. SERVICE TO REC CENTER
8" FIRE
3" DOMESTIC
6" SEWER

LATERAL LOCATIONS

UNKNOWN

ORIGINAL - SCOPE OF WORK
AS SHOWN ON EXHIBIT " A" OF

SERVICE AGREEMENT DATED
9/24/ 2020
AMENDMENT 1 - SCOPE OF

WORK AS SHOWN ON

SERVICE AGREEMENT DATED
12/ 3/2020
AMENDMENT 2 - SCOPE OF

WORK AS SHOWN ON

SERVICE AGREEMENT DATED
1/5/2021
AMENDMENT 3 - SCOPE OF
WORK AS SHOWN ON "
EXHIBIT " A" OF SERVICE
AGREEMENT DATED 5/11/ 2021
0' 30' 60' N120'
SCALE: 1" = 60'
LEGEND:

TOPOGRAPHIC SURVEY

SCOPE COMPARISON

APPROXIMATE LIMITS OF ORIGINAL SCOPE FOR
TOPOGRAPHIC SURVEY, DATED 9/24/2020
APPROXIMATE LIMITS OF AMENDMENT 1 SCOPE FOR
ADDITIONAL TOPOGRAPHIC SURVEY, DATED 12/3/2020
APPROXIMATE LIMITS OF AMENDMENT 2 SCOPE FOR
ADDITIONAL TOPOGRAPHIC SURVEY, DATED 1/5/2021
APPROXIMATE LIMITS OF AMENDMENT 3 SCOPE FOR
ADDITIONAL TOPOGRAPHIC SURVEY, DATED 5/11/2021
AUGUST 4, 2021

EXHIBIT B
DocuSign Envelope ID: C7864012- D0DE- 4640-96CF-F438918CE3D2 408
City of South Lake Tahoe – JKAE
PSA Amendment No. 5 to Master Agreement
AMENDMENT NO. 5 TO PROFESSIONAL SERVICES AGREEMENT
The Professional Services Agreement C-084-2020 entered into on July 28, 2020, between the City of South Lake Tahoe, a municipal corporation (“ CITY”) and JK Architectural Engineering ( JKAE) (“ CONSULTANT”) is hereby amended as set forth below.

The terms of the Professional Services Agreement are hereby amended to read as follows:

1. Scope of Services. In addition to the Scope of Services specified within the original Professional Services Agreement, dated July 28, 2020, this Amendment to the Agreement adds the work described within Exhibit A “ Compensation Schedule”, attached hereto and incorporated herein by reference, is hereby amended to include the additional fees and compensation included with Exhibit A, Amendment No. 5 to the Agreement.

2. Term/ Time of Performance. The services by Consultant are to commence upon the execution of this Agreement and shall continue until all authorized work is approved by City. All such work shall be completed not later than May, 2025. Time is of the essence, and failure of Consultant to perform the services required by this Agreement, as amended, by May 2025 shall constitute a material breach of this Agreement as amended.

3. Compensation. Compensation to be paid to the Consultant, as defined within the original Agreement is hereby increased with this Amendment No. 5 by the sum of 855,428.00 as described within Exhibit A attached hereto. In no case shall Consultant compensation for work completed under this Agreement exceed the amended Agreement amount of $3,921,415 plus the additional fee of $885,428.00 for an amended total fee of 4,776,843 without written authorization from the City. Payment by the City under this Agreement shall not be deemed a waiver of defects, even if such defects were known to the City at the time of payment.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on the date first written above.

CITY OF SOUTH LAKE TAHOE CONSULTANT
By: __________________________ By: __________________________ Devin Middlebrook, Mayor Jordan Knighton
Partner JKAE
Business License # 008282
APPROVED AS TO FORM: ATTEST:

Heather Stroud, City Attorney Susan Blankenship, City Clerk C-106-2022
The presence of electronic signature certifies that the foregoing is a true and correct copy as approved by the South Lake Tahoe City Council.
2022Heather Stroud ( Jun 27, 2022 08:29 PDT) Sue Blankenship (Jun 24, 2022 08:09 PDT) Jun 24, Devin Middlebrook ( Jun 27, 2022 10:10 PDT)Jun 27, 2022 Jordan Knighton (Jul 1, 2022 13:06 PDT) Jordan KnightonJul 1, 2022
409
AUBURN | TAHOE CITY | RENO | SAN JOSE
165 River Road, Suite 1, Tahoe City, CA 96145 530. 583. 9222 www. jkaedesign. com IMAGINE | DESIGN | CREATE

LETTER OF AUTHORIZATION TO PROCEED
Contract Amendment 05 – Construction Administration Services DATE: March 21, 2022
CLIENT: City of South Lake Tahoe, Attn. Jim Marino
JOB#: 20-370
PROJECT: Recreation Center

PROJECT AMENDMENT
In accordance with the Professional Services Agreement for the above-mentioned project, dated July 28, 2020, and previous project amendments, this Letter of Authorization to Proceed confirms the following amendment to the contract:

Contract Amendment 05 – Construction Administration Services:

Construction Administration support and services as outlined in Prime Agreement ( attached Exhibit A) and subsequent contract amendments based on previously- authorized scope changes and fee increases. This amendment is not a scope change, but rather our formal request for authorization of the Construction Administration phase fee. This fee is broken up below into phase 1 and phase 2 allocations. Only the phase 1 fee would be utilized for Spring/Summer/ Fall 2022 construction administration support. The overall combined Construction Administration fee has not changed from what is shown, but not yet authorized, in the Prime Agreement ( attached Exhibit A).

FEE AMENDMENT
Services Current
Includes Amends 1-4)
Adjustments Revised
Programming & Concept Design $ 372,030.00 -$ 372,030.00 Schematic Design $ 655,750.00 -$ 655,750.00
Design Development $ 1,234,062.00 -$ 1,234,062.00
Construction Documents $ 1,385,979.00 -$ 1,385,979.00
Agency Review $ 205,705.00 -$ 205,705.00
Bid Support $ 67,889.00 -$ 67,889.00
Add Service 01: LEED IP $ 8,800.00 -$ 8,800.00
Amendment 05: Construction Administration $ 00.00 $ 855,428.00 $ 855,428.00 20% - Site (Phase 1) $ 171,085.60 $ 171,085.60
80% - Building ( Phase 2) $ 684,342.40 $ 684,342.40
TOTALS $ 3,930,215.00 $ 855,428.00 $ 4,785,643.00
CONTRACT NOTE:

Other than the revised scope and fees as outlined above, nothing in this Amendment is intended to amend or revise any of the contract provisions for the executed Professional Services Agreement.

Please review and let me know if you have any questions.

Sincerely: Approved:

Chris Vicencio, Partner, C26985 Client Date
JK Architecture Engineering
Print Name/Title
Devin Middlebrook, Mayor
C-106-2022
Devin Middlebrook (Jun 27, 2022 10:10 PDT) Jun 27, 2022 410
C-106-2022 Jordan Knight Architects
Final Audit Report 2022- 07-01
Created: 2022- 06-23
By: jo Mcdonough ( jmcdonough@cityofslt. us)
Status: Signed
Transaction ID: CBJCHBCAABAAALNFT9Z- z6XdsdaXhBFMDSWDo_ FXCfzo C-106-2022 Jordan Knight Architects" History
Document created by jo Mcdonough ([email protected]) 2022- 06- 23 - 11:58:47 PM GMT- IP address: 128. 92.136. 146 Document emailed to Sue Blankenship ([email protected]) for signature 2022- 06- 24 - 0:02:09 AM GMT
Email viewed by Sue Blankenship ( sblankenship@cityofslt. us) 2022- 06- 24 - 3:07:03 PM GMT- IP address: 128. 92.136. 146 Document e-signed by Sue Blankenship ([email protected]) Signature Date: 2022- 06-24 - 3:09:31 PM GMT - Time Source: server- IP address: 128. 92.136. 146 Document emailed to Heather Stroud ([email protected]) for signature 2022- 06- 24 - 3:09:34 PM GMT
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2022- 07- 01 - 8:06:37 PM GMT
412
413
AUBURN | TAHOE CITY | RENO | SAN JOSE
165 River Road, Suite 1, Tahoe City, CA 96145 530.583.9222 www. jkaedesign. com IMAGINE | DESIGN | CREATE

LETTER OF AUTHORIZATION TO PROCEED
Additional Service 02 – Bid Set Repackage/Project Rebid/Value Engineering DATE: February 20, 2023
CLIENT: City of South Lake Tahoe, Attn. Jim Marino
JOB#: 20-370
PROJECT: Recreation Center

PROJECT ADDITIONAL SERVICE
In accordance with the Professional Services Agreement for the above-mentioned project, dated July 28, 2020, and previous project amendments, this Letter of Authorization to Proceed confirms the following additional service to the contract:

Additional Service 02 – Bid Set Repackage/ Project Rebid/Value Engineering:

The summer 2022 construction of Phase 1 site work has been substantially completed. Phase 2 building and remainder of site work will go out to rebid in early May of 2023. Client has requested that design team repackage the bid set so that it shows no reference to Phase 1 or Phase 2. The repackaged set shall show all completed Phase 1 work as “existing”.

References to a “phased” project shall be removed from the set. Specifications shall clearly state “or approved equal”. Per the request of the local fire authority, a fire lane shall be added to the design that connects the new parking lot/fire lane to the existing bike path on the NW portion of the site. In addition, the design team shall undertake a Value Engineering ( VE) process to identify a list of approximately 15 items for the City’s approval to be removed from the drawing set or converted to bid alternates. The VE process shall:

Provide value of at least 5:1 cost benefit of the estimated construction cost savings to design team fee for revision.

Not reduce overall program area or previously approved program uses.

Not require a revision to the TRPA approved project design including exterior elevations, building height, coverage, or materials/ color selections.

Not include cost estimating. Any cost evaluation for the proposed VE items shall be performed by the CM team.

Not incorporate items that require systems re-engineering or plan check/ permit revision. Note that even finish revisions can trigger plan check review for ADA access compliance or Health Department. Additional plan review efforts would be handled on an additional Time & Materials basis.

Schedule & Fee
Contingent upon approval by Client and design team is authorized to proceed by end of day Tuesday, February

28. Any delay in this approval/ notice to proceed date will delay the deliverable schedules below.

Bid Set Repackaging ( CD Phase)
o Schedule: Design team completes effort by Friday, March 31, 2023 (4 weeks).

Design team transmits repackaged set to client and to third-party building plan check team.

Third-party plan checker anticipates their plan review to be complete in about 2 weeks. o Process: Client/CM will provide one set of review comments only. Process does not include progress sets. Design team will work through any plan check comments via a “back check” meeting to reduce duration of final plan approval. Design team will also transmit repackaged set to utility companies and Public Works Dept. during this period.
o Fee: Fixed Fee of $71,750
Value Engineering ( CD Phase)
o Schedule: Design team provides list of VE items by Wednesday, March 8, 2023 (2 weeks). Client approves items for design/drawing revisions by Friday, March 10, 2023 (2 days). 414
City of South Lake Tahoe Rec Center – Add 02 Page | 2 of 2 Design team completes VE effort by Friday, March 31, 2023 (3 weeks) and includes in repackaged set (above).
o Fee: Hourly Not to Exceed Fee of $24,000
Rebid of Repackaged Set (Bid Phase)
o Schedule: Design team supports rebid of project which is anticipated to take approximately 60 calendar days from May 1, 2023 to the end of June 2023. o Fee: Fixed Fee of $48,800
Note: This represents the previously established bid phase fee for the Phase 2 scope of work only. Reminder that the overall bid phase fee was previously broken up as 20% Phase 1 site work and 80% Phase 2 buildng and remaining site work. The additional fixed fee above represents the 80% portion of the bid phase fee minus an additional goodfaith fee reduction of 10%.

FEE ADJUSTMENT
Services Current
Includes Amendments 1-5)
Adjustments Revised
Programming & Concept Design $ 372,030.00 - $ 372,030.00 Schematic Design $ 655,750.00 - $ 655,750.00
Design Development $ 1,234,062.00 - $ 1,234,062.00
Construction Documents $ 1,385,979.00 - $ 1,385,979.00
Agency Review $ 205,705.00 - $ 205,705.00
Bid Support $ 67,889.00 - $ 67,889.00
Construction Administration ( 20%) $ 171,085.60 - $ 171,085.60 Construction Administration ( 80%) $ 684,342.40 $ 684,342.40 Add Service 01: LEED IP $ 8,800.00 - $ 8,800.00
Add Service 02: Repackage/ Rebid/VE - $ 144,550.00 $ 144,550.00 TOTALS $ 4,785,643.00 $ 144,550.00 $ 4,930,193.00
CONTRACT NOTE:

Other than the revised scope and fees as outlined above, nothing in this additional service is intended to amend or revise any of the contract provisions for the executed Professional Services Agreement.

Please review and let me know if you have any questions.

Sincerely: Approved:

Chris Vicencio, Partner, C26985 Client Date
JK Architecture Engineering
Print Name/Title
415
416
417
City of South Lake Tahoe
Agenda Item Executive Summary
Joe Irvin, City Manager
__________________________________
Meeting Date: December 10,
2024
Agenda Item #:15
Agenda Item: Recognized Obligation Payment Schedule (ROPS) Fiscal Year 2025-2026 Executive Summary: In an effort to balance its budget, the State of California adopted Assembly Bill (AB) x1 26 on June 28, 2011, amended by AB 1484 on June 27, 2012, which suspended all new redevelopment activities except for limited specified activities as of that date and dissolved redevelopment agencies on February 1, 2012. The Successor Agency Board is required by state law to annually pass a resolution approving the ROPS.

Requested Action / Suggested Motions: Acting as the South Tahoe Redevelopment Successor Agency Board, Pass a Resolution approving the Recognized Obligation Payment Schedule (ROPS) pursuant to Health and Safety Code section 34177 for the fiscal period commencing July 1, 2025, and ending June 30, 2026.

Responsible Staff Member: Olga Tikhomirova, Finance Director Reviewed and Approved By: Susan Blankenship, City Clerk Heather Stroud, City Attorney Attachments:
01-Staff Report ROPS 2025-2026.DOCX
02-Resolution STRSA ROPS 2025-2026.DOCX
03-ROPS 2025-2026 (Exh. A to Resolution).pdf
04-Sponsoring Entity Loan Repayment ROPS 2025-26 (Exh. B to Resolution).pdf 418
Council Agenda Report December 10, 2024 Page | 1
City of South Lake Tahoe
Report to South Tahoe
Redevelopment Successor Agency
Meeting Date: December 10, 2024
Title: Recognized Obligation Payment Schedule (ROPS), FY 2025-2026 Location: Citywide
Responsible Staff Member: Olga Tikhomirova, Director of Finance (530) 542-7431 Background: In an effort to balance its budget, the State of California adopted Assembly Bill (AB)x1 26 on June 28, 2011, amended by AB 1484 on June 27, 2012, which suspended all new redevelopment activities except for limited specified activities as of that date and dissolved redevelopment agencies on February 1, 2012.

The suspension provisions prohibited all redevelopment agencies from a wide range of activities, including incurring new indebtedness or obligations, entering into or modifying agreements or contracts, acquiring or disposing of real property, taking actions to adopt or amend redevelopment plans and other similar actions, except actions required by law or to carry out existing enforceable obligations, as defined in ABx1 26.

Certain housing assets and functions of the former Redevelopment Agency (“Former RDA”) were to be distributed to a Housing Successor and all remaining Former RDA assets and liabilities were to be distributed to a Successor Agency. The City elected to become the Successor Agency, and the assets and liabilities of the Successor Agency are recorded in the Redevelopment Obligation Retirement PrivatePurpose Trust Fund (Fund 725).

Issue and Discussion: Pursuant to Health and Safety Code (“HSC”) section 34177(o)(1), Successor Agencies are required to prepare Recognized Obligation Payment Schedules (“ROPS”) prior to each twelve-month fiscal period. The ROPS is then ratified by the Oversight Board and subsequently submitted to the County Auditor and State Department of Finance (“DOF”). ROPS 2025-2026 for the period of July 1, 2025 to June 30, 2026 is due February 1, 2025.

Financial Implications: The preparation and approval of this ROPS, including the Administrative Budget, will allow the Successor Agency to continue to pay enforceable obligations of the Former RDA and is required by HSC section 34177. The 2025-2026 ROPS reflects the full repayment of the Supplemental Educational Revenue Augmentation Fund (SERAF) loan and includes the first payment on the City loan, both of which are based on a statutory formula and were previously approved for funding and repayment as enforceable obligations. More information about these loans is in the following paragraphs.

On July 25, 2014, the local Oversight Board of the Successor Agency to the South Tahoe Redevelopment Agency adopted Resolution No. 2014-4 which approved repayment of a loan incurred in Fiscal Year 2010- 11 by the Former RDA to pay remittance to the Supplemental Educational Revenue Augmentation Fund (SERAF) in the total amount of $426,210. Prior to dissolution, the Former RDA was required to maintain a Low and Moderate Income Housing Fund (the “Housing Fund”) and deposit certain amounts of tax increment received by the Former RDA into the Housing Fund. The Former RDA was permitted to incur a loan payable to the Housing Fund (the “SERAF Loan”) to pay the required FY 2010-11 SERAF payment.

As a result of the RDA dissolution, the City designated the South Tahoe Housing Authority to act as the Housing Successor for the Former RDA, and the Housing Authority assumed the housing assets and functions of the Former RDA. The SERAF Loan constitutes an enforceable obligation of the Former RDA, provided that the repaid funds are used in a manner consistent with the affordable housing requirements of 419
Council Agenda Report December 10, 2024 Page | 2
the Redevelopment Law. The DOF informed the local Oversight Board in writing that DOF was not initiating a review of Resolution No. 2014-4.

According to HSC Section 34176(e)(6)(B), the aggregate repayment amount authorized each fiscal year for the SERAF Loan shall not exceed one-half of the increase between the amount distributed to taxing entities pursuant to HSC Section 34183(a)(4) in that fiscal year and the amount distributed to taxing entities pursuant to HSC Section 34183(a)(4) in the 2012-13 base year (“RPTTF residual”).

Based on the calculations using the Sponsoring Entity Loan Repayment Calculator provided by the DOF (attachment 04), for Fiscal year 2025-26, it is estimated that the ROPS 2024-25 RPTTF residual balance is available to continue repayment of the SERAF Loan. Therefore, the repayment of the SERAF Loan is included on the ROPS 2025-2026. This will be the second and final payment on the SERAF Loan.

Also on July 25, 2014, the local Oversight Board of the Successor Agency to the South Tahoe Redevelopment agency adopted Resolution No. 2014-5 which approved repayment of a loan incurred in Fiscal Year 2003-04 by the Former RDA pursuant to a Loan and Repayment Agreement between the City and the Former RDA, dated March 16, 2004 (the “2004 Loan Agreement”) for costs and expenses related to the implementation of the Former RDA’s redevelopment program (the “2004 City Loan”). Pursuant to HSC Section 34191.4(b), the Oversight Board made a finding that the 2004 City Loan was for legitimate redevelopment purposes in order to re-establish the 2004 Loan Agreement as an enforceable obligation.

The 2004 City Loan in the remaining amount of $5,276,219 (including principal and interest) was added to the ROPS 14-15B and on September 8, 2014, the DOF informed the City in writing that it approved the Oversight Board resolution.

Pursuant to HSC section 34176(3)(6)(B), the aggregate repayment amount authorized each fiscal year for the SERAF Loan and the 2004 City Loan combined shall not exceed one-half of the increase between the amount distributed to taxing entities pursuant to HSC Section 34183(a)(4) in that fiscal year and the amount distributed to taxing entities pursuant to HSC Section 34183(a)(4) in the 2012-13 base year (“RPTTF residual”). Pursuant to HSC section 34176(e)(6)(B), the SERAF Loan repayment has a priority over the 2004 City Loan repayment and must be paid in full before any repayment of the 2004 City Loan is made. Pursuant to HSC section 34191.4(b)(2), twenty percent of each repayment of the 2004 City Loan must be transferred to the Low and Moderate Income Housing Asset Fund established and held by the Housing Authority, as the Housing Successor to the Former RDA.

Based on the calculations using the Sponsoring Entity Loan Repayment Calculator, there is a remainder in the ROPS 2024-25 RPTTF residual balance after the SERAF Loan repayment and the amount is available to begin the repayment of the 2004 City Loan. Therefore, the repayment of the 2004 City Loan is included on the ROPS 2025-2026, along with the SERAF Loan final payment.

Environmental Considerations: The proposed action is not a “project” subject to review under the California Environmental Quality Act (CEQA) under CEQA Guidelines section 15378(b)(4) (creation of government funding mechanisms or government fiscal activities which do not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment).

Policy Implications: The preparation and approval of this ROPS is consistent with HSC section 34177(o)(1).
420
STRSA Resolution 2024-XXX December 10, 2024 Page 1 of 5 STRSA Resolution 2024-XXX
Adopted by the Board of Directors of the
South Tahoe Redevelopment Successor Agency
December 10, 2024
Approving a Recognized Obligation Payment Schedule (ROPS 2025-26), Including an Administrative Budget, Pursuant to Health and Safety Code Section 34177 for the Fiscal Period Commencing July 1, 2025 and Ending June 30, 2026, and Taking Related Actions

BACKGROUND
A. The South Tahoe Redevelopment Agency (the “Former RDA”) was a duly constituted redevelopment agency pursuant to provisions of the Community Redevelopment Law (the “Redevelopment Law”) set forth in Section 33000 et seq. of the Health and Safety Code (“HSC”) of the State of California.

B. Pursuant to HSC 33334.2, the Former RDA was required to maintain a Low and Moderate Income Housing Fund (the “Housing Fund”) and deposit certain amounts of tax increment received by the Former RDA into the Housing Fund.

C. Pursuant to HSC Section 33690.5(a), the Former RDA was required to make a remittance (the “FY 2010-11 SERAF Payment”) to the El Dorado County AuditorController for deposit into the County Supplemental Educational Revenue Augmentation Fund (‘SERAF”) for fiscal year 2010-11.

D. Pursuant to HSC Section 33690.5(c), the Former RDA was permitted to, and did, incur a loan repayable to the Housing Fund (the “SERAF Loan”) to pay the FY 2010-11 SERAF Payment.

E. In 2004, the Former RDA was permitted to and did incur a loan from the City (the “2004 City Loan”) pursuant to a Loan and Repayment Agreement between the City and the Former RDA, dated March 16, 2004 (the “2004 Loan Agreement”) for costs and expenses related to the implementation of the Former RDA’s redevelopment program.

F. Pursuant to AB X1 26 (enacted in June 2011), and the California Supreme Court’s decision in California Redevelopment Association, et al. v. Ana Matosantos, et al., 53 Cal.4th 231(2011), the Former RDA was dissolved as of February 1, 2012, the Successor Agency to the South Tahoe Redevelopment Agency (“Successor Agency”) was established, and a local oversight board of the Successor Agency was established.

The Former RDA’s non-housing assets were distributed to, and liabilities were assumed by, the Successor Agency.

G. Pursuant to HSC Section 34176(b), the City Council of the City of South Lake Tahoe designated the South Lake Tahoe Housing Authority as the successor entity with 421
STRSA Resolution 2024-XXX December 10, 2024 Page 2 of 5 respect to the housing assets and functions of the Former RDA (the “Housing Successor”) pursuant to its Resolution No. 2012-65, adopted on October 16, 2012.

H. Pursuant to HSC Section 34176(d), all funds transferred to the Housing Successor and all funds generated from housing assets must be maintained in a Low and Moderate Income Housing Asset Fund (the “Housing Asset Fund”), established and held by the Housing Successor.

I. Pursuant to HSC Section 34171(d)(1)(G), the SERAF Loan constitutes an enforceable obligation; provided that the repayment schedule must be approved by the oversight board of the Successor Agency, and repayments must be transferred to the Housing Asset Fund and used in a manner consistent with the affordable housing requirements of the Redevelopment Law.

J. By its Resolution No. 2014-5, adopted on July 15, 2014, the Board of Directors of the Successor Agency requested the local oversight board of the Successor Agency (i) to authorize the inclusion of a line item on future ROPS, for the repayment of the SERAF Loan, up to the maximum repayment amount calculated in accordance with HSC Section 34176(e)(6)(B), until the SERAF Loan has been paid in full; and (ii) to recognize that the repayment of the SERAF Loan as described in the Successor Agency resolution shall constitute the repayment schedule of the SERAF Loan for the purposes of HSC Section 34171(d)(1)(G) and approve such repayment schedule.

K. On July 25, 2014, the local oversight board of the Successor Agency adopted its Resolution No. 2014-4, which approved inclusion of the SERAF Loan on future ROPS and the repayment schedule as described in the above-described Successor Agency Resolution.

L. On July 30, 2014, the State Department of Finance (“DOF”) informed the oversight board in writing that the DOF was not initiating a review of the oversight board’s Resolution No. 2014-4.

M. By its Resolution No. 2014-6, adopted on July 15, 2014, the Board of Directors of the Successor Agency requested the local oversight board of the Successor Agency to (i) make a finding that the 2004 City Loan was for legitimate redevelopment purposes and the 2004 Loan Agreement is an enforceable obligation, with the recognition that the repayment terms shall be modified in accordance with the HSC Section 34191.4(b) requirements; (ii) authorize the Finance Officer of the Successor Agency to develop a repayment schedule for the 2004 City Loan in accordance with the requirements of HSC Section 34191.4(b), recognizing that the actual dollar amount to be repaid by the Successor Agency for each scheduled repayment is subject to the availability of funds from the Redevelopment Property Tax Trust Fund and the limitations set forth in HSC Section 34191.4(b); and (iii) authorize the Finance Officer to modify the repayment schedule from time to time based on the requirements of HSC Section 34191.4(b) and the actual circumstances at the time of the modification.

N. On July 25, 2014, the local oversight board of the Successor Agency adopted its Resolution No. 2014-5, which approved repayment of the 2004 City Loan. Pursuant to HSC Section 34191.4(b), the oversight board made a finding that the 2004 City Loan 422
STRSA Resolution 2024-XXX December 10, 2024 Page 3 of 5 was for legitimate redevelopment purposes in order to re-establish the 2004 Loan Agreement as an enforceable obligation. On September 8, 2014, the DOF informed the City in writing that it approved the Resolution No. 2014-5.

O. Pursuant to HSC section 34176(e)(6)(B), the SERAF Loan repayment has a priority over the 2004 City Loan repayment and must be paid in full before any repayment of the 2004 City Loan is made. Pursuant to HSC section 34191.4(b)(2), twenty percent of each repayment of the 2004 City Loan must be transferred to the Low and Moderate Income Housing Assest Fund established and held by the Housing Authority, as the Housing Successor to the Former RDA.

P. Pursuant to HSC Section 34176(e)(6)(B), the aggregate repayment amount authorized each fiscal year for the SERAF Loan and the 2004 City Loan combined shall not exceed one-half of the increase between the amount distributed to taxing entities pursuant to HSC Section 34183(a)(4) in that fiscal year and the amount distributed to taxing entities pursuant to HSC Section 34183(a)(4) in the 2012-13 base year.

Q. Pursuant to HSC Section 34179(j), as of July 1, 2018, the El Dorado Countywide Oversight Board (the “Countywide Oversight Board”) has jurisdiction over the Successor Agency.

R. Pursuant to HSC Section 34177(o)(1), the Successor Agency must prepare a ROPS listing the anticipated payments for enforceable obligations to be made by the Successor Agency during the fiscal period from July 1, 2025 through June 30, 2026 (“ROPS 25-26”) and submit ROPS 25-26 to the Countywide Oversight Board for approval.

S. Pursuant to HSC Section 34177(l)(2)(B), at the same time that the Successor Agency submits ROPS 25-26 to the Countywide Oversight Board for approval, the Successor Agency must submit a copy of ROPS 25-26 to the DOF, the County administrative officer, and the County Auditor-Controller.

T. Pursuant to HSC Section 34177(l)(2)(C) and Section 34177(o)(1), the Successor Agency must: (i) submit the Countywide Oversight Board-approved ROPS 25-26 to the DOF, the Office of the State Controller, and the County Auditor-Controller no later than February 1, 2025, and (ii) post a copy of the Countywide Oversight Board-approved ROPS 25-26 on the Successor Agency’s website.

U. A partial repayment of SERAF Loan was included on ROPS 2024-25. As of the date of this Resolution, the remaining portion of the SERAF Loan outstanding and unpaid is $141,191.

V. A repayment of SERAF Loan in the amount of $141,191 and a partial repayment of 2004 City Loan in the amount of $131,227 are included on ROPS 2025-26.

NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE SUCCESSOR AGENCY TO

THE SOUTH TAHOE REDEVELOPMENT AGENCY HEREBY FINDS, DETERMINES, RESOLVES AND ORDERS AS FOLLOWS:
423
STRSA Resolution 2024-XXX December 10, 2024 Page 4 of 5

1. The above recitals are true and correct and are a substantive part of this Resolution.

2. The Board of Directors hereby approves ROPS 2025-26, including the Administrative Budget, substantially in the form attached as Exhibit “A” to this Resolution and incorporated herein by reference. The Executive Director of the Successor Agency, in consultation with the Successor Agency’s legal counsel, may modify ROPS 2025-26 as the Executive Director or the Successor Agency’s legal counsel deems necessary or advisable.

3. Staff is hereby authorized and directed to submit a copy of ROPS 25-26 to the Countywide Oversight Board for approval and, at the same time, transmit a copy of ROPS 25-26 to the DOF, the County Auditor-Controller and the County administrative officer as designated by the County.

4. Staff is hereby authorized and directed to submit a copy of the Countywide Oversight Board-approved ROPS 25-26 to the DOF, the Office of the State Controller, and the County Auditor-Controller. If the Countywide Oversight Board has not approved ROPS 25-26 by February 1, 2024, Staff is hereby authorized and directed to transmit ROPS 25-26 to the DOF, the Office of the State Controller, and the County Auditor-Controller by February 1, 2025, with a written notification regarding the status of the Countywide Oversight Board’s review. Written notice and information regarding the action of the Countywide Oversight Board shall be provided to the DOF by electronic means and in a manner of DOF’s choosing.

5. Staff is hereby authorized and directed to post a copy of the Countywide Oversight Board-approved ROPS 25-26 on the Successor Agency’s Internet website (being a page on the Internet website of the City of South Lake Tahoe).

6. The officers and the other staff members of the Successor Agency are hereby authorized and directed, jointly and severally, to do any and all things which they may deem necessary or advisable to effectuate this Resolution, including but not limited to requesting additional review by the DOF and an opportunity to meet and confer on any disputed items, and making adjustments to ROPS 25-26 pursuant to the DOF’s instructions, and any such actions previously taken are hereby ratified and confirmed.

Adopted by the Board of Directors of the Successor Agency of the South Tahoe Redevelopment Agency at a duly noticed meeting held on December 10, 2024, by the following vote:

Yes:

No:

Absent:

Abstain:
424
STRSA Resolution 2024-XXX December 10, 2024 Page 5 of 5 ___________________________ Date:___________
, Agency Chair
Attest:
______________________________
Susan Blankenship, Agency Secretary
The presence of electronic signature certifies that the foregoing is a true and correct copy as approved by the South Lake Tahoe City Council
425
Recognized Obligation Payment Schedule (ROPS 25-26) - Summary Filed for the July 1, 2025 through June 30, 2026 Period Successor Agency: South Lake Tahoe
County: El Dorado
Current Period Requested Funding for Enforceable
Obligations (ROPS Detail)
25-26A Total
(July -
December)
25-26B Total
(January -
June)
ROPS 25-26
Total
A Enforceable Obligations Funded as Follows (B+C+D) $ 1,007,650 $ 7,650 $ 1,015,300 B Bond Proceeds - - -
C Reserve Balance - - -
D Other Funds 1,007,650 7,650 1,015,300
E Redevelopment Property Tax Trust Fund (RPTTF) (F+G) $ 3,154,004 $ 1,267,721 $ 4,421,725 F RPTTF 3,129,004 1,242,721 4,371,725
G Administrative RPTTF 25,000 25,000 50,000
H Current Period Enforceable Obligations (A+E) $ 4,161,654 $ 1,275,371 $ 5,437,025 Certification of Oversight Board Chairman:

Name Title
Pursuant to Section 34177 (o) of the Health and Safety
code, I hereby certify that the above is a true and
accurate Recognized Obligation Payment Schedule for
the above named successor agency. /s/
Signature Date
426
South Lake Tahoe
Recognized Obligation Payment Schedule (ROPS 25-26) - ROPS Detail July 1, 2025 through June 30, 2026

A B C D E F G H I J K L M N O P Q R S T U V W
Item
# Project Name Obligation Type
Agreement
Execution
Date
Agreement
Termination
Date
Payee Description Project
Area
Total
Outstanding
Obligation
Retired
ROPS
25-26
Total
ROPS 25-26A (Jul - Dec)
25-26A
Total
ROPS 25-26B (Jan - Jun)
25-26B
Total
Fund Sources Fund Sources
Bond
Proceeds
Reserve
Balance
Other
Funds RPTTF Admin RPTTF
Bond
Proceeds
Reserve
Balance
Other
Funds
RPTTF
Admin
RPTTF
$71,625,820 $5,437,025 $- $- $1,007,650 $3,129,004 $25,000 $4,161,654 $- $- $7,650 $1,242,721 $25,000 $1,275,371 6 Contracted
Financial
Services
Fees 10/01/
1999
10/01/2037 Bank of
New York
Mellon,
Willdan,
Fraser &
Associates
Trustee
Services,
arbitrage
rebate
calculations,
continuing
disclosure
reports, pass
through
calculations
Park
Avenue
Area
#1
15,300 N $15,300 - - 7,650 - - $7,650 - - 7,650 - - $7,650 7 Contracted
Legal Services
Admin
Costs
10/01/
2007
10/01/2037 Richards,
Watson and
Gershon
Redevelopment
Dissolution
Legal Costs
Park
Avenue
Area
#1
5,000 N $5,000 - - - - 2,500 $2,500 - - - - 2,500 $2,500 21 Administrative
Costs
Admin
Costs
01/01/
2014
10/01/2037 City of
South Lake
Tahoe
Costs to
Administer
Successor
Agency
(internal debt
administration,
accounting
financial
reporting, legal
and banking
fees
45,000 N $45,000 - - - - 22,500 $22,500 - - - - 22,500 $22,500 25 Supplemental
Educational
Revenue
Augmentation
Fund loan
SERAF/
ERAF
03/01/
2011
10/01/2037 City of
South Lake
Tahoe LowModerate
Income
Housing
Fund
Supplemental
Educational
Revenue
Augmentation
Fund Loan
141,191 N $141,191 - - - - - $- - - - 141,191 - $141,191 26 City General
Fund loan to
the
Redevelopment
Agency for
Completion of
Park Avenue
Project
City/
County
Loan
(Prior 06/
28/11),
Cash
exchange
03/14/
2004
10/01/2037 City of
South Lake
Tahoe
General
Fund
Park Avenue
Project
Completion
costs loan
Park
Avenue
Area
#1
5,276,219 N $131,227 - - - - - $- - - - 131,227 - $131,227 27 2014
Redevelopment
Project Area
No. 1 Series A
Bonds
Issued
After 12/
31/10
12/08/
2014
10/01/2034 Bondholders
paid by
Trustee
(Bank of
Refunding of
1999, 2003,
and 2004
Refunding
Park
Avenue
Area
#1
28,320,191 N $1,762,494 - - 1,000,000 315,160 - $1,315,160 - - - 447,334 - $447,334 427

A B C D E F G H I J K L M N O P Q R S T U V W
Item
# Project Name Obligation Type
Agreement
Execution
Date
Agreement
Termination
Date
Payee Description Project
Area
Total
Outstanding
Obligation
Retired
ROPS
25-26
Total
ROPS 25-26A (Jul - Dec)
25-26A
Total
ROPS 25-26B (Jan - Jun)
25-26B
Total
Fund Sources Fund Sources
Bond
Proceeds
Reserve
Balance
Other
Funds RPTTF Admin RPTTF
Bond
Proceeds
Reserve
Balance
Other
Funds
RPTTF
Admin
RPTTF
Notes New York
Mellon)
Revenue
Bonds to fund
non-housing
projects
28 2015
Redevelopment
Project Area
No. 1 Series A
Notes
Bonds
Issued
After 12/
31/10
09/16/
2015
10/01/2035 Bondholders
paid by
Trustee
(Bank of
New York
Mellon)
Refunding of
2005
Refunding
Revenue
Bonds to fund
non-housing
projects
Park
Avenue
Area
17,367,016 N $2,403,319 - - - 2,142,097 - $2,142,097 - - - 261,222 - $261,222 29 2017 Loan
Agreements
(securing
Authority's
2017
Refunding
Revenue Bond)
Bonds
Issued
After 12/
31/10
09/01/
2017
10/01/2037 Bondholders
paid by
Trustee
(Bank of
New York
Mellon)
Refunding of
2007 RDA
Notes sercuring
bonds to fund
non-housing
projects
20,455,903 N $933,494 - - - 671,747 - $671,747 - - - 261,747 - $261,747 428
South Lake Tahoe
Recognized Obligation Payment Schedule (ROPS 25-26) - Report of Cash Balances July 1, 2022 through June 30, 2023
(Report Amounts in Whole Dollars)
Pursuant to Health and Safety Code section 34177 (l), Redevelopment Property Tax Trust Fund (RPTTF) may be listed as a source of payment on the ROPS, but only to the extent no other funding source is available or when payment from property tax revenues is required by an enforceable obligation.

A B C D E F G H
ROPS 22-23 Cash Balances
(07/01/22 - 06/30/23)
Fund Sources
Comments
Bond Proceeds Reserve Balance Other Funds RPTTF
Bonds issued
on or before
12/31/10
Bonds issued
on or after
01/01/11
Prior ROPS
RPTTF and
Reserve
Balances retained
for future
period(s)
Rent, grants,
interest, etc.

Non-Admin
and Admin
1 Beginning Available Cash Balance (Actual 07/01/22)
RPTTF amount should exclude "A" period distribution
amount.
5,114,590 Only balances in Reserve Fund are reported
here
2 Revenue/Income (Actual 06/30/23)
RPTTF amount should tie to the ROPS 22-23 total
distribution from the County Auditor-Controller
129,071 5,021,234 Other Funds are revenues transferred in on an as-needed basis to cover the RPTTF
shortfall. Only transfers needed to cover
shortfall are reported here. Other transfers
within this timeframe covered previous ROPS
shortfall and were made due to City's 9/30/24
fiscal year end.
3 Expenditures for ROPS 22-23 Enforceable Obligations
(Actual 06/30/23)
129,071 5,021,234 Other Funds are only reported up to the actual expenditures. Other funds transferred
to cover shortfall that will not be used for
enforceable obligations will be transferred
back to original fund that made transfer.
4 Retention of Available Cash Balance (Actual 06/30/23) RPTTF amount retained should only include the amounts
distributed as reserve for future period(s)
429
Pursuant to Health and Safety Code section 34177 (l), Redevelopment Property Tax Trust Fund (RPTTF) may be listed as a source of payment on the ROPS, but only to the extent no other funding source is available or when payment from property tax revenues is required by an enforceable obligation.

Non-Admin
and Admin
5 ROPS 22-23 RPTTF Prior Period Adjustment
RPTTF amount should tie to the Agency's ROPS 22-23 PPA
form submitted to the CAC
No entry required
6 Ending Actual Available Cash Balance (06/30/23)
C to F = (1 + 2 - 3 - 4), G = (1 + 2 - 3 - 4 - 5)
$5,114,590 $- $- $- $-
430
South Lake Tahoe
Recognized Obligation Payment Schedule (ROPS 25-26) - Notes July 1, 2025 through June 30, 2026
Item # Notes/Comments
6 7
21 25
26 27
28 29
431
County Name Agency Name South Lake Tahoe

ROPS II
July thru December
2012

ROPS III
January thru June
2013
Total For
Base Year
0 0 0
ROPS 24-25 A
July thru December
2024
ROPS 24-25 B
January thru June
2025
Total For
Comparison
Year
0 544,835 544,835
A 544,835
B 0
A-B 544,835
÷2
272,418
El_Dorado
Maximum Repayment for
Fiscal Year 2025-26
Sponsoring Entity Loan Repayment Calculator
Base Year:

Residual Balance
Comparison Year:

Residual Balance
ROPS Review Period: ROPS 25-26
Total Residual Balance for Comparison Year
Total Residual Balance for Base Year
Difference of Residual Balance
432
City of South Lake Tahoe
Agenda Item Executive Summary
Joe Irvin, City Manager
__________________________________
Meeting Date: December 10,
2024
Agenda Item #:16
Agenda Item: South Tahoe Refuse Interim Year and Senate Bill 1383 Rate Increase Executive Summary: The City maintains a solid waste franchise agreement with South Tahoe Refuse (STR) for collection and disposal services. The City Council approved the current franchise agreement with STR on August 22, 2023. The Agreement continues to use the 2012 Rate Setting Policy and Procedures Manual, which is also used by the other two partners in the South Lake Tahoe Basin Waste Management Authority (JPA): El Dorado County and Douglas County. The Interim Year increase is based on Consumer Price Index, landfill disposal, and other costs. The JPA's rate-setting consultant's analysis identified an interim Year rate increase of 3.30% for an interim year adjustment, and a 5.08% for Senate Bill 1383 program implementation for the City of South Lake Tahoe, which equates to an increase of $3.46 per month for residential customers and $3.96 per cubic yard for commercial customers.

Requested Action / Suggested Motions: (1) Conduct a Majority Protest Public Hearing; and if no majority protest is received, (2) Pass a Motion approving South Tahoe Refuse Interim Year Rate Increase of 3.30 percent and 5.08 Percent for Senate Bill 1383 ($3.46 per month for residential customers and $3.96 per cubic yard for commercial customers), effective January 1, 2025.

Responsible Staff Member: Anush Nejad Public Works Director, and Sara Letton, Sustainability Coordinator
Reviewed and Approved By: Susan Blankenship, City Clerk Olga Tikhomirova, Director of Finance Heather Stroud, City Attorney
Attachments:
01-Staff Report - South Tahoe Refuse 2025 Rate Adjustment.docx 02 - Rate Setting Manual.pdf
03 - Prop 218 Notice 10.15.24 2.pdf
04 - Crowe Rate Review Report.pdf
05- South Shore Budget 24-25.pdf
06 - Clean Tahoe Program 2023-24 Report.pdf
Combined Written Protests.pdf
433
Council Agenda Report December 10, 2024 Page 1 of 3
City of South Lake Tahoe
Report to City Council
Meeting Date: December 10, 2024
Title: South Tahoe Refuse Interim Year Rate Increase of 3.30 Percent and 5.08 Percent for Senate Bill 1383
Location: Citywide
Responsible Staff Member: Anush Nejad, Director of Public Works (530) 542- 6031 and Sara Letton, Sustainability Coordinator (530) 542-6175
Background: The city maintains a solid waste franchise agreement with South Tahoe Refuse (STR) for solid waste collection and disposal. The City Council authorized current franchise agreement with STR August 22, 2023.

The Agreement continues to use the 2012 Rate Setting Policy and Procedures Manual (Manual) (Attachment 02). The Manual establishes rate change policies, provides application forms, specifies reporting formats, identifies required supporting documentation, and describes the procedures for requesting, reviewing, and adopting rate changes. The Manual is utilized by the three jurisdictional partners in the South Lake Tahoe Basin Waste Management Authority (JPA).

The partner agencies include the City of South Lake Tahoe, El Dorado County, and Douglas County. On October 11, 2024, the JPA considered the proposed rate increase and recommended approval to the partner agencies.

Proposition 218 Notice: The city notified property owners and customers at least 45 days before the Public Hearing by mailing written notices of the proposed residential and commercial increase for the solid waste services on October 22, 2024. As further described below (See Public Notification Attachment 03), those property owners and customers may submit a written protest of the proposed rate increase to the City Clerk any time before the close of the public hearing on December 10, 2024. If less than a majority of the property owners and customers file written protests to the proposed rate increase, the City Council may approve the proposed change to the solid waste rates.

Issue and Discussion: The Manual describes the process for rate adjustment for both the base year and interim years on a 3-year cycle. The JPA and STR followed the interim year process in Section 3 of the Manual for interim years 2014,2016, 2017, 2019, 2020, 2022, and 2023 and the base year process for rate years 2015, 2018, 2021, and 2024. The current rate adjustment (2025) is an interim year adjustment.

On July 11, 2024, STR submitted its Application to the JPA for rate year 2025. The JPA approved a contract with Crowe, LLC to review STR’s interim year rate application and to recommend a proposed rate adjustment.
434
Council Agenda Report December 10, 2024 Page 2 of 3
On September 24, 2024, Crowe LLP (Crowe) completed an analysis of South Tahoe Refuse Company’s Inc.’s (STR) 2025 Interim Year Rate Application. The rate adjustment proposed for 2025 is an increase of 3.30% for an interim year and 5.08% for Senate Bill 1383 program implementation, as shown in the table below. (Attachment 04 Rate Review Report).

The proposed 2025 rate increases for residential and commercial customers are summarized below:

Service Type Current Rate (Per
Customer, Per Month
Proposed Rate (Per
Customer Per Month,
including SB 1383
Proposed Rate
Increase (Per
Customer Per Month)
Unlimited Residential
Service *
$41.26 $44.72 $3.46
Commercial Rate per
Cubic Yard
$47.20 $51.16 $3.96
* Excluding City surcharges for street sweeping ($0.25) and nuisance abatement ($0.25). For the City of South Lake Tahoe, Clean Tahoe is a subcontractor to STR for litter abatement, debris, and illegal dumping cleanup services. The Clean Tahoe Budget is included (Attachment 05) and Final Report (Attachment 06).

The recently approved rate adjustments for the City of South Lake Tahoe are shown below:
 2016 – No rate change – interim year
 2017 – 1.62 percent rate increase – interim year.
 2018 – 8.81 percent rate increase – base year
 2019 – 3.11 percent rate increase – interim year.
 2020 – 2.93 percent rate increase – interim year.
 2021 – 9.04 percent rate increase – base year
 2022 – 3.77 percent rate increase – interim year.
 2023 – 4.96 percent rate increase – interim year.
 2024 – 11.05 percent rate increase – base year.

On October 11, 2024, the JPA Board approved the report and recommended that each jurisdiction consider and approve the rate adjustment.

Mandatory Commercial Organic Recycling Act and Short-Lived Climate Pollutants Bill:

The 2023 Franchise Agreement includes requirements for the Mandatory Commercial Organics Recycling Act of 2014 (AB 1826) and the Short-Lived Climate Pollutants Bill of 2016 (SB 1383).

These bills have directed all local agencies to promote diversion and maximize the use of feasible waste reduction, reuse, recycling, and composting options to reduce the amount of refuse that must be disposed of and to avoid the production of short-lived climate pollutants. SB 1383 establishes regulatory requirements for jurisdictions, generators, haulers, solid waste facilities, and other entities to support the achievement of State-wide Organic Waste Disposal reduction targets. It requires the City to implement collection programs, meet processing facility requirements, conduct contamination monitoring, provide education, maintain records, submit reports, monitor compliance, conduct enforcement, and fulfill other requirements. The City has delegated some of its responsibilities to STR, acting as its designee. 435
Council Agenda Report December 10, 2024 Page 3 of 3
The 2023 Franchise Agreement has a 20-year term to allow STR to amortize the capital expenses STR will incur to implement the 3-cart residential collection system required to implement SB 1383. The City entered into this franchise agreement with such a term based on STR’s prior satisfactory service and to ensure the successful implementation of SB 1383 and with the inclusion of other contractual provisions that advance the City’s economic and environmental goals.

The 2023 Franchise Agreement required STR to provide residential customers with new carts to implement the 3-cart collection program in Fall 2024, which has now occurred.

Crowe’s report included the rate adjustments in 2025 for compliance with SB 1383, including the roll-out of the 3-cart system.

Financial Implications: A 3.30% for an interim year, and 5.08% for Senate Bill 1383 program implementation within the City of South Lake Tahoe will increase the cost of STR’s unlimited service for residential customers by $3.46 per month. For commercial customers, the increase will be $3.96 per cubic yard.

Environmental Considerations: This action is not a “project” requiring review under the California Environmental Quality Act (CEQA) under CEQA Guidelines section 15378(b)(4) (government fiscal activities which do not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment).

Policy Implications: The application process and analysis utilized to determine the interim year rate adjustment are consistent with the Solid Waste Rate Setting Policies and Procedures Manual. The updated franchise agreement supports the local implementation of the Mandatory Commercial Organic Recycling Act and Short-Lived Climate Pollutants Bill, which are consistent with the City’s Climate Action Plan WA-2 ‘Promote reductions in organic waste and landfill diversion’.
436
South Lake Tahoe Basin
Waste Management Authority
Solid Waste Rate Setting
Policies and Procedures Manual
March 30, 2012
437
Table of Contents
Section

1. Rate Setting Goals and Objectives ................................................ 1-1 A. Introduction .................................. ............................................................. 1-1 B. Rate Setting Goals ...................................................................................... 1-2 C. Rate Setting Policies .............................................. ..................................... 1-3 D. Rate Application Process ............................................................................ 1-6 E. Allowable and Non-Allowable Costs .......................................................... 1-8

2. Base Year Rate Setting Process ....................................................... 2-1 A. Step 1 - Prepare and Submit Rate Application ........................................... 2-1 B. Step 2 - Verify Completeness of Rate Application ...................................... 2-8 C. Step 3 - Review Rate Application and Prepare Response ............................ 2-8 D. Step 4 - Prepare Draft Report and Final Report.. ..................................... 2-10 E. Step 5 - Present Final Report to JPA Board ............................................. 2-12 F. Step 6 - Notify Customers of Rate Hearing ............................................. 2-12 G. Step 7 - Receive Approval from City Council and County Boards ........... 2-12 H. Step 8 - Implement New Rates ................................................................ 2-13

3. Interim Year Rate Setting Process ................................................... 3-1 A. Step 1 - Prepare and Submit Rate Application ............................. .............. 3-1 B. Step 2 - Prepare Draft Report and Final Report ............. ............................ 3-2 C. Step 3 - Receive Approval from City Council and County Boards ............. 3-6 D. Step 4 -Implement New Rates ................................................................... 3-6 Appendix
A. Blank Forms and Worksheets ........... .. .................... .. ....................... A-1 438
[This page intentionally left blank.]
ii Solid Waste Rate Setting Policies and Procedures Manual 439
8 .
.

Section l
Rate Setting Goals and O~jectives
440
l . Rate Setting Goals
and Objectives
This section of the manual provides an overview of the rate setting process. The section includes five subsections:

A. Introduction
B. Rate Setting Goals
C. Rate Setting Policies
D. Rate Application Process
E. Allowable and Non-Allowable Costs.

A. Introduction
This manual is a step-by-step guide for the South Lake Tahoe Basin Waste Management Authority QPA), and its franchise hauler, to prepare and approve changes in solid waste collection rates. The manual establishes rate change policies, provides application forms, specifies reporting formats, identifies required supporting documentation, and describes the procedure for requesting, reviewing, and adopting rate changes. The following three (3) jurisdictions make up the JPA:
• City of South Lake Tahoe, California
• El Dorado County, California
• Douglas County, Nevada.

In 1996, the JPA developed a "Solid Waste Collection, Recycling, and Transfer Station Operations Rate Setting Policies and Procedures Manual' ( 1996 Manual) as a tool to use to regulate solid waste rates. This version (version 2.0) represents the first update to the 1996 Manual since that time.

The franchise hauler for the three (3) jurisdictions is South Tahoe Refuse Company, Inc. (STR). Each jurisdiction has a franchise agreement with STR for collection and disposal of refuse as follows:
• Collection Franchise Agreement between El Dorado County and South Tahoe Refase Company, Inc., dated February 13, 1995 • Solid Waste Services Agreement between City of South Lake Tahoe and South Tahoe Refase Company, Inc., dated August 21, 2001 • Solid Waste Services Agreement between Douglas County and South Tahoe Refuse Company, Inc., dated October 2006. ' ' The franchise agreement has been amended three times. On March 15, 2007, the franchise was amended to reflect the correct franchise fee (First Amendment). On October 15, 2009, the franchise was amended to update indices used in the cost-of-living adjustment (COLA, Second Amendment). The most recent amendment was signed on December 21, 2009, again revising the COLA, to account for negative rate changes (Third Amendment). 441
Table 1- 1
South Tahoe Refuse Company, Inc.

Business Divisions
-- Divisions Service Areas
I. South Tahoe • City of South
Refuse Company Lake Tahoe
• Unincorporated
El Dorado County
• Douglas County,
Nevada

2. American River • Unincorporated
Disposal El Dorado County

3. Sierra Disposal • Unincorporated
Service El Dorado County
Covered
by Manual
Yes
No
No
Each franchise agreement currently has slightly
different terms and conditions for how rates are
set. The intent of this manual update is to replace
these varied rate setting terms and conditions with
common rate setting terms and conditions that the
JPA, and the three (3) jurisdictions, can agree to,
and apply. The intent of this manual update is
for each jurisdiction to incorporate this updated
version 2.0 of the manual, by reference, into their
respective franchise agreements with STR.

This manual is meant as a tool for setting rates
for the three (3) jurisdictions, combined. The JPA
will be responsible for reviewing rate applications
submitted by the franchised hauler. The JPA will
recommend percentage rate changes to apply to the
three (3) jurisdictions.' Each jurisdiction, however,
will have the ultimate authority to approve the
JPA's rate change recommendation (i.e., at the city
council or board of supervisor level).
3 2 For base year reviews, there would be one recommended rate change for the City of South Lake Tahoe and Douglas County, and one recommended rate change for El Dorado County. For interim year reviews, there would be one recommended rate change for the City of South Lake Tahoe and El Dorado County, and one recommended rate change for Douglas County.
3 Interim year rate setting for the City of South Lake Tahoe and Douglas County is procedural and does not require a rate hearing. Interim year rate setting for El Dorado County does require a rate hearing.

The franchised hauler, South Tahoe Refuse
Company, Inc. , has three (3) divisions as shown
in Table 1-1, left. T he South Tahoe Refuse
Company represents the division covered by
this manual.

The JPA intends for this manual to be revised
over time, as needed, to reflect changes in objectives
or modifications to the franchise agreements. 4
B. Rate Setting Goals
The primary goal of the rate setting process and
methodology is to determine solid waste collection
rates which are fair to customers and which provide
a fair return to the franchise hauler. A total of six
(6) rate setting process goals were considered in
developing this rate setting methodology:

1. The JPA and franchised hauler should start
with a strong and committed partnership.

The JPA and franchised hauler should view
this franchise as a business partnership where
both parties commit to use the formal rate
setting methodology, and plan continuous
communication on rate setting
throughout the franchise term.

2. Rates requested by the franchise hauler must
be justifiable and supportable. A formal
request to change rates, submitted by the
franchise hauler, should provide the basis for
all rate changes, include only allowable and
necessary costs, and provide accountability
for expenditures. In determining rates, the
JP A shall consider both the need for fairness
to the ratepayer and the need to compensate
the franchise hauler fairly and consistently
with the methodology.

3. The estimated costs of service, and resulting
solid waste rates, should be reasonable.

The JPA acknowledges that maintenance
• Should the JPA dissolve at any time in the future, the three jurisdictions have indicated a preference to continue to use this manual on a jurisdictional basis. Jurisdiction-specific rate setting would require some modifications to the methodology in that STR would have to allocate its revenues and costs to each jurisdiction.
1-2 Solid Waste Rate Setting Policies and Procedures Manual 442
of quality service is related to providing
adequate compensation, and financial
incentives, for continued good performance.

Revenues generated should be adequate
to fully meet reasonable costs-of-service.

The resulting monthly fees for solid waste
collection service should be comparable
to those charged in other jurisdictions for
providing similar services.

4. The process should be kept as simple as
possible, while ensuring that any rate
request is justifiable and reasonable. The
process should be easy to explain and not
place an undue cost on either the JPA,
the jurisdictions, or the franchise hauler
to implement. The process also should
minimize administrative efforts of the JPA,
and its jurisdictions.

5. The rate setting process should provide
mechanisms for ongoing rate review
and rate stability. A periodic, formal, and
thorough JPA review (every three years)
of financial and operating data will set an
expectation for the hauler and ultimately
will protect the ratepayer. These reviews
should be conducted consistently and in
accordance with set schedules in the
manual. The process should prevent large,
unexpected fluctuations in rates due to
changes in costs or from the need to fund
a broadening scope of waste management
services. This formal process also serves to
meet the fiduciary responsibility of the JPA,
and individual jurisdictions, to its ratepayers.

6. The JPA and franchised hauler should
strive to maximize opportunities to
improve performance and service quality
while maintaining cost competitiveness in
the marketplace. In a "cost-plus-profit"
contract such as exists between the
jurisdictions and franchised hauler, there
can be less incentive for the hauler to
decrease costs because increases in allowable
costs actually result in increases in allowable
operating profit levels. Ideally, the JPA, and
the hauler, should set rates in a base year,
and the hauler should attempt to reduce its
costs in subsequent years.

C. Rate Setting Policies
The JPA will use the following eight (8)
policies when setting rates:

1. Use the Operating Ratio Method to
Determine Profit - The JPA will use the
operating ratio (OR) method to establish
revenue requirements for setting rates.

The operating ratio establishes revenue
requirements based on allowable expenses
and is defined as follows:

Operating = Allowable expenses
ratio Allowable expenses + Profit
The operating ratio effectively determines
the profit allowed to the franchise hauler on
operating costs. Total revenue requirements
then are determined as the sum of:
(1) allowable operating costs, (2) allowable
profit, and (3) pass-through costs (for which
the franchise hauler receives no profit).

Specific operating ratios are provided in
Exhibit 1-1 on page 1-10.

2. Do Not Allow Retroactive Rate Increases -
There will be no allowance for a retroactive
increase in rates, except by special
agreement, or by party default. Retroactive
reimbursements can move rates out of
alignment with the actual costs of providing
service. This process and methodology
codifies strict rate review timelines and
responsibilities. If the JPA, jurisdictions,
and hauler adhere to these timelines for
submission and rate change approval, and
no party defaults on these timelines, all
future rates should be established such that
there is no need for retroactive rate increases.

3. Do Not Allow Balancing Accounts -
This rate setting process is based on projecting
results during base years. Thus, actual base
year results likely will differ from base year
projections. In some regulatory environments,
these differences are "balanced" in subsequent
years by using a balancing account.

Balancing accounts are occasionally used in
the waste industry as an accounting-based
approach to true up a previous year's
1-3
443
projections to actual financial results. A
balancing account can then be used to address
differences between actual and projected
results. A balancing account requires
substantial administration, reporting, and
control measures which determine how funds
in the account are invested and managed.

When a balancing account is established,
terms and conditions related to these accounts
are clearly documented as part of a rate
setting process and methodology manual.

Also, terms and conditions are specifically
incorporated by reference into contractual
agreements between the respective parties.

The problem with balancing accounts is
that by funding surpluses and deficits using
rate revenues, rates charged to customers
ultimately do not reflect the true cost of
providing service to customers because they
include retroactive components. Over time,
current ratepayers can end up ultimately
subsidizing, or beneficing from, prior
generations of ratepayers. For example,
if rates are raised to pay off a balancing
account, then current ratepayers bear the
responsibility of what previous ratepayers
should have paid for initially.

Municipal finance principles generally
require a strong nexus between (1) cost-ofservice and benefits and (2) cost-of-service and rates. Use of a balancing account
generally breaks down this nexus and
results in rate inequalities.

A balancing account also frequently is less
useful when a long-term franchise exists.

With a long-term business partnership,
there is less need to recover variances
between actual and projected results on
a year-to-year basis. These variances can
often be absorbed over the course of a long
term franchise, such as is the case between
the jurisdictions and franchise hauler.

Balancing accounts are not designed to
account for differences between "rates asked
for" and "rates received." They also are not
designed for accounting for differences
between "rates received" and "a fair rate of
return. " Balancing accounts, by their very
nature, result in retroactive rates, which do
not reflect cost-of-service based rates.

4. Do Not Allow Fuel Surcharges - There
will be no separate "fuel surcharges" added
to rates to account for increases in fuel
costs. Fuel surcharges create accounting
problems (e.g., which fuel index to use,
over what time period to use the index,
and determining what portion of the rate
that fuel costs represent). Fuel surcharges
require separate accounting from allowable
rate changes which may already reflect
compensation to the franchise hauler for
changes in fuel costs (e.g., as part of a CPIbased rate change during interim years).

Fuel surcharges lag actual changes in fuel
prices (by as much as one year), so changes
in the fuel surcharge are disconnected
from current changes in fuel prices. Fuel
costs typically represent a relatively small
portion of the overall rate charged (less
than ten (10) percent), minimizing the
impact of fluctuating fuel prices on overall
rates. Finally, once established, fuel
surcharges can linger within rates during
periods when fuel prices are stable and
when a fuel surcharge is not necessary.

5. Analyze Related Party Transactions -
The company has certain related-party
transactions with affiliates. The company
must disclose all related party transactions
as part of the rate setting process.

The JPA will allow only those transactions
with these related parties which are "market
based." The JPA will assess whether related
party transactions are conducted on an
"arms length" basis, equivalent to terms as
with an unrelated party in the conditions
of a competitive, free market, environment.

STR related parties are identified in
Table 1-2, on the next page.

During its review, the JPA may request that
STR provide the following information in
support of related party transactions:

D Allocation methods used, if applicable
1-4 Solid Waste Rate Setting Policies and Procedures Manual 444
Table 1-2
STR Related Parties and Transactions
Related Company Relationship/Transaction
Douglas Disposal, • Owned by same ownership
Inc. (DOI) group as STR
• STR leases facility space to DOI
• STR leases office space to DOI
• STR leases computers to DOI
• STR loans money to DOI
Tahoe Basin • Owned by same ownership
Container Service group as STR
(TBC) • STR leases facility space and
equipment to TBC
• ST R leases office space to TBC
• STR rents computers to TBC
• STR loans money to TBC
American River • Owned by same ownership
Disposal (ARD) group as STR
• STR leases office space to ARD
• STR leases computers to ARD
• STR provides office contract
labor to ARD
Sierra Disposal • Owned by same ownership
Service (SOS) group as STR
• ST R leases office space to SOS
• STR leases computers to SOS
0 Nature, extent, and magnitude of
the relationship
0 Terms of the related parry transaction
(e.g., timing of payments, term length)
0 Historical information (e.g., ownership)
0 Dace of acquisition (if applicable)
0 Purchase price of item (if applicable)
0 Financing terms for item (if applicable).

The JPA may require STR to provide up
to three (3) comparable lease races for
leases of facilities and equipment. For
related parry company leases, the JPA may
require STR to identify financing charges,
or profit components, within these lease
rates. STR should be prepared to support
the business purpose for each related
parry transaction.

The JP A will examine how related parry
transactions are created for rate setting
purposes in the Base Year Rate Application.

The JPA will assess whether related
parry transactions already have a profit
component on chem, and if so, treat these
related parry transactions as pass-through
costs (without a profit component)
to avoid a "double counting" of profit.

The JPA will consider all of the above
factors in determining whether the related
parry transaction is an allowable cost and
is charged at a reasonable amount.

6. Account for Prior Resource Recovery
Facility (RRF) Rate Funding - For each of
the three consecutive years of 2005, 2006,
and 2007, each of the three jurisdictions
approved a nine (9) percent race increase
for STR. The first of these three nine (9)
percent race increases, implemented in 2005,
was provided to fund general STR cost
increases. For the second nine (9) percent
race increase implemented in 2006, a total of
six (6) percent of chis nine (9) percent rate
increase was provided to fund operating
and capital costs of the Resource Recovery
Facility (RRF) project. For the third nine (9)
percent rate increase, implemented in 2007,
a total of six ( 6) percent of chis rate increase
also was provided to fund operating and
capital costs of the Resource Recovery
Facility (RRF) Project.

For 2006, and 2007, El Dorado County
and Douglas County required chat STR
pay the six ( 6) percent race increase, which
was provided to cover the RRF, to the JPA.

The JPA then released these amounts back
to STR upon completion of certain RRF
project milestones.

For 2006, and 2007, the City of South
Lake Tahoe required chat STR pay the
six (6) percent rate increase, which was
provided to cover the RRF, to the City
of South Lake Tahoe. The City of South
Lake Tahoe then released these amounts
back to STR upon completion of certain
RRF project milestones.
1-5
445
Table 1-3
Recycling Revenue Bonus Amounts
For Extraordinary Diversion
(2012 to 2018)
-
Minimum Minimum
Diversion Rate Diversion Rate
Years To Achieve 25% To Achieve 50%
of Recycling of Recycling
Revenue Share Revenue Share
2012 to 2014 38 44
2015 to 2016 40 47
201 7 co 2018 43 50
STR received these RRF-related funds and
collected project revenues in excess of
project expenses totaling $4,722,285. The
RRF project was completed in April, 2010.

Beginning at the next base year (2012),
STR will include a credit to JPA
jurisdiction ratepayers of $787,048 each
year through the end of 2017. This
amount was determined by dividing the
credit of $4,722,285 by six years. The
credit amount of $787,048 will be applied
to the base year rate in 2012 and 2015.

This means that in each base year, the
$787,048 amount will be reset as a credit
line item in the base year rate application.

7. Use Recycling Materials Sales Revenue
Sharing - There will be a recycling revenue
bonus which is tied to STR diversion levels.

In addition to the calculation of allowed
profit, STR is allowed the recycling revenue
bonuses shown in Table 1-3, below. For
years 2019 and beyond, the JPA will reassess
whether the recycling diversion rates, which
trigger revenue sharing, remain sufficient
to meet State of California diversion
requirements. For 2019 and beyond, the
JPA may adjust the diversion rates, which
trigger revenue sharing, upward by up to
three (3) percent per year to achieve greater
State of California diversion requirements.

8. Eliminate Annual Summary Report -
Beginning in 2010, STR will no longer be
required to submit an Annual Summary
Repon as had been the required practice dating
back to the original 1996 Manual version.

9. Unforeseen Circumstances - The JPA
and/or the three jurisdictions shall consider
a proposed revision in STR's rates whenever
STR establishes to the satisfaction of the
JPA and/or each jurisdiction that unforeseen
circumstances have arisen that have or will
materially affect STR's costs or revenues
under this rate manual.

D. Rate Application Process

1. Base Year Process
The JPA requires that the franchise hauler
submit a detailed Base Year Rate Application once
every three (3) years. With the Base Year Rate
Application, the franchise hauler provides detailed
financial and operating information which is
carefully reviewed and analyzed by the JP A.

These detailed reviews are referred to as "base
year reviews" in the methodology.

With the Base Year Rate Application, the franchise
h~uler submits audited financial statements for the
previously completed fiscal year. These statements
serve as the base documents for the application.

The franchised hauler should reconcile financial
information contained in the Base Year Rate
Application with the audited financial statements
to provide assurance that all of the company's
activities are accounted for.

The timing of the base year process is shown
in Figure 1-1, on the next page. The schedule
is expected to start with submission of the Base
Year Rate Application on May 31" of the year
proceeding each base year. The process targets
an implementation date of January 1" of the
base year. 5
5 For Douglas County, the maximum rate increase is 9.9 percent before the County must take the increase to the County citizens for a vote of approval.
1-6 Solid Waste Rate Setting Policies and Procedures Manual 446
Figure 1-1
Timing of Base Year Process
2 Verify Completeness of Rate Application
3 Review Rate Application and Prepare Response
4 5
6 7
8 Prepare Draft Report and Final Report
Prepare Final Report to JPA Board
Notify Customers of Rate Hearing
Receive Approval from City Council and
County Boards
Implement New Rates
Table 1-4
Base Year Financial Statement Requirements
(Fiscal Year Ending June 30)
Base Prior Current Base
Year Year Year Year
(Audited) (Estimated) (Projected)
2012' 2010 2011 2012
2015 2013 2014 2015
2018 2016 2017 2018
2021 2019 2020 2021
2024 2022 2023 2024
2027 2025 2026 2027
The Base Year Rate Application requires three
(3) years of data, including a year of actual data
(based on audited information), a year of
estimated data (based on year-to-date information
available at the time the application is submitted),
and the projection, or base year. The required
years, and types, of data for upcoming base year
reviews are displayed in Table 1-4, above. For
• Represents the fiscal year ending June 30, 2011 .
example, for the 2012 base year, STR would
prepare the Base Year Rate Application using
audited 2010 data, estimated year-to-date 2011
data, and entirely projected 2012 data.

STR operates on a fiscal year ending June 30.

Thus, for the current year, STR should have
available the first three quarters of compiled,
not audited, fiscal year data to use for its current
year estimate (i.e., data through March of the
current year).

2. Interim Year Process
In each of the "interim" two (2) years between
"base" years, should the franchised hauler want to
increase rates, the JPA requires that the franchise
hauler submit an Interim Year Rate Application
for an interim year rate change. The scope and
content of the Interim Year Rate Application is
much more limited than a base year request. The
franchised hauler is not obligated to request an
increase in rates and can instead request to leave
rates unchanged.
1-7
447
Figure 1-2
Timing of Interim Year Process
2 Prepare Draft Report and Final Report
3 Receive Approval from City Council and County Boards. 4 Implement New Races
During the interim years, STR shall be entitled to
increase its rates based upon the following formula:
(1) eighry-five (85) percent of the annual
percentage change in the most recent actual,
not forecasted, change in the Consumer
Price Index, All Urban Consumers,
U.S. Ciry Average - Garbage and Trash
Collection (December 1983= 100, series
CUUROOOOSEHG02) ("CPI") applied to
costs other than landfill disposal costs, plus
(2) projected changes in landfill disposal costs.
7 For the first part of the calculation (noted as
(1) above), the JPA and franchised hauler will use
the percentage change in the CPI for the prior
June to June twelve-month period. This June to
June CPI data will be available at the time the
franchised hauler submits the Interim Year
Application in August (see Exhibit A-4, for sample
of CPI percent change calculation).

Interim year rate adjustments are subject to a
"floor" and 'a "cap." During interim years, rates
shall not be greater than six ( 6) percent nor less
than one (1) percent, regardless of the rate
change calculated by the interim year formula.

The timing of the interim year process is
shown in Figure 1-2, above. The schedule is
expected to start with submission of the Interim
7 These landfill disposal costs are currently set by a non-related party to STR, under a long-term disposal agreement.

Year Rate Application on August 31" of the year
proceeding the interim year. The process targets
an implementation date of January 1" of the
interim year.

E. Allowable and
Non-Allowable Costs
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: ,
• Allowable costs
• Allowable operating profits
• Pass through costs.

For purposes of computing the revenue
requirement, it is necessary to determine which
of the franchise hauler's costs are (1) allowable
costs, (2) pass through costs, and (3) nonallowable costs.

1. Allowable Costs
When a cost is said to be "allowable," that
cost, plus a profit component associated with
that cost, is included in rates charged to the
ratepayers. Allowable costs are often those costs
that are integral to the hauler's operation and/or
are associated with actual activiry performed by
the hauler.
1-8 Solid Waste Rate Setting Policies and Procedures Manual 448
Table 1-5
Allowable Depreciation Methods and Useful Lives
for STR Assets Purchased After January 1 , 201 O - -
Category Method Useful Life
(Years)
Carts SL' 5
Office Equipment SL 5
Vehicles and Equipment SL 8
Buildings and Leasehold SL 20 Improvements
The hauler is allowed to earn a profit on certain
costs. The majority of allowable costs are direct
labor, equipment costs and facility costs, landfill
disposal costs, office salaries, and general and
administrative costs. These allowable costs are
defined in Exhibit 1-1, on the following page.

Exhibit 1-2, following Exhibit 1-1, includes a
chart of expense accounts (based on current STR
financial statements) for allowable costs, which
serves to further clarify categories of allowable costs.

The following costs are clarified because of
their special treatment for rate setting:
• Depreciation - Table 1-5, above, shows
depreciation methods and useful lives, by
asset type, recommended for rate setting
purposes. Current methods used to
depreciate capital items, which were in use
prior to this version 2.0 of the manual, are
allowed to continue. Useful lives in Table
1-5 are for new capital purchases (i.e.,
those made during and after 2010).
• Officer's Salaries - Reasonable officer's
salaries are considered an allowable cost.

Officers are employees fully performing
management functions identified in the
franchise agreement. Officer's salaries
include base compensation plus bonuses
and do not include profit distributions
to owners. The JPA shall set the total
combined officer's salaries for the franchise
• Represents straight-line depreciation.
hauler, at a reasonable level, during each
base year. For purposes of establishing
base year rates, the total amount of
officer's salaries of six ( 6) percent of gross
revenues is deemed reasonable.
9 • Materials Recovery Facility and Resource
Recovery Facility Capital Costs - The
rate treatment of equipment and building
costs associated with the STR Materials
Recovery Facility (MRF) and Resource
Recovery Facility (RRF) is summarized in
Table 1-6, on page 1-13. These rate
treatment provisions are based on the
agreed upon terms and conditions at the
time the MRF and RRF were constructed.
• Blue and Green Bag Program Costs -
STR currently provides blue bag curbside
recycling services to JP A customers. STR
collects these blue bags with the refuse
container and sorts the materials at its
Materials Recovery Facility (MRF). Blue
bags are, however, currently paid for by
the jurisdictions themselves and not STR.

For the blue bag program, the costs for
blue bags are not included in current rates
charged to JPA customers.

STR plans to roll out a yardwaste program,
with or without the green bags also
collected with the refuse container.

Materials from the yardwaste program will
be sorted at STR' s Resource Recovery
Facility (RRF). For the yardwaste program,
the costs for green bags are not included in
current rates charged to JPA customers.

During the next rate review, blue bag and
yardwaste program revenues and costs will
be fully reflected in the rates charged to
JPA customers. The full costs of the blue
bag and yardwaste programs will be
9 Currently, officer salaries have been limited to an agreed upon amount specified in the franchise agreements to be adjusted annually by a CPI. STR distributes the officer salaries, under its discretion, within the limit allowed under the current franchise agreements for the City of South Lake Tahoe, El Dorado County, and Douglas County. Providing for officer salaries of 6 percent of gross revenues will provide about the same limit for officer salaries as the allowable amount specified in the franchise agreements.
1-9
449
Exhibit 1- 1
Definition of Financial Terms Page I of2
Application Line Number/Item Definition
Allowable Operating Costs
I. Direct Labor Wages, and related benefits, paid to refuse collection staff, including wages, overtime, payroll taxes, health and welfare benefits, workers compensation, and pension benefits.

2. Equipment Costs Includes cost of equipment depreciation, equipment leases, equipment insurance, equipment and Facility Costs repair and maintenance, fuel, and other miscellaneous equipment expenses. Facilities expenses consist of building rent, building depreciation, and building repair /and maintenance.

3. Landfill Disposal Costs Costs to dispose of solid waste at landfills.

4. Office Salaries Wages, and related benefits, paid to office and administrative staff, including wages, overtime, payroll taxes, health and welfare benefits, workers compensation, and pension benefits.

5. General and General and administrative coses including:

Administration Costs • Advertising
• Colleccion fees
• Contract labor
• Dues and subscriptions
• Employee education
• General insurance
• Office repair and maincenance
• Officer salaries and benefits (less chan or equal to six (6) percent of gross revenues) • Professional fees
• Property caxes
• Office expense
• Licenses
• Supplies
• Travel
• Utilities.
1-1 O Solid Waste Rate Setting Policies and Procedures Manual 450
Exhibit 1-1
Definition of Financial Terms , tir ~""J) Page2 f2
Application Line Number/Item Definition
Operating Ratio (OR)
Allowable Operating Profit
MRF and RRF Principal
Payments
Interest Expense
Franchise Fees
Resource Recovery Facility Fund
Credit
Allowable Operating Profit
For the City of South Lake Tahoe and Douglas County, a profit is allowed based on a sliding scale which varies with STR's recovery percentage as follows:

Operating Ratio Recovery Percentage

94.34 0-15%

93.90 16

93.46 17

93.02 18

92.59 19

92.17 20

91.74 21

91.32 22

90.90 23

90.50 24
89 25-28
88 29-32
87 33-100
For El Dorado County, a profit is allowed, based on a targeted operating ratio ranging betweer 87 and 91 percent. For El Dorado County, in the base year, if rates remain unchanged at an operating ratio within the range of 87 to 91 percent, and the franchise hauler actually realized an operating ratio within this range, then that same operating ratio resulting in no rate change is used, and no rate change occurs. Otherwise, an 89 percent operating ratio is used for the bas year calculation. For El Dorado County, the operating ratio for the first base year (2012) will be set at 89 percent.

Established by the allowable operating ratio and equal to total allowable costs divided by the allowable OR, less total allowable costs.

Pass Through Costs
For the City of South Lake Tahoe and Douglas County, principal payments on debt used to finance the Materials Recovery Facility (MRF) and Resource Recovery Facility (RRF). For El Dorado County, principal payments on the debt used to finance the MRF and RRF will be allowed with profit.

For the City of South Lake Tahoe and Douglas County, interest on debt used to finance all STR operations. For El Dorado County, interest on the debt used to finance the MRF and RRF will be allowed with profit.

Equal to five (5) percent of gross residential, commercial, and recycling revenues for the City of South Lake Tahoe and El Dorado County, and three (3) percent of gross residential, commercial, and recycling revenues for the Douglas County. 10 Rates will be reduced by an amount of$288,121 (plus afcer tax interest) for each year between 2012 and 2024
10 This franchise fee amount is subject to change by any of the three (3) JPA jurisdictions. 1- 11
451
Exhibit 1-2
Chart of Accounts
for Allowable Operating Costs
Category Description
Direct Labor • Direct Labor
• Direct Labor Benefits
• Direct Labor Insurance
• Direct Labor Workers Compensation
• Direct Labor Pension
• Direct Labor Payroll TaJCes
Equipment Costs and Facility Costs • Equipment and Facility Depreciation • Property Rent
• Equipment Rent
• Fuel
• Repairs and Maintenance
Landfill Disposal Costs • Dump Fees
Office Salaries • Office Scaff Salaries
• Office Scaff Benefits
• Office Scaff Insurance
• Office Scaff Workers Compensation
• Office Scaff Pension
• Office Staff Payroll T aJCes
General and Administrative Costs • Advertising
• Contract Labor
• Dues and Subscriptions
• Employee Education
• General Insurance
• Office Expense
• Officer Salaries
• O cher Administrative Costs
• Licenses and Fees
• Property T aJCes
• Supplies
• Travel
• Ucilicies
1-12 Solid Waste Rate Setting Policies and Procedures Manual 452
Table 1-6
Materials Recovery Facility and Resource Recovery Facility Capital and Operating Cost Treatment -
Description
Materials Recovery Facility and Resource Recovery Facility Depreciation Equipment Depreciation II
Building Depreciation
Materials Recovery Facility and Resource Recovery Facility Building Financing Interest
Principal
12 Materials Recovery Facility and Resource Recovery Facility Equipment Financing Interest
Principal
- Rate Setting Treatment
Allowable with Profit
Non-Allowable Cost
Pass-Through Expense
Pass-Through Expense
Pass-Through Expense
Non-Allowable Cost
11 Includes reasonable depreciation on equipment used in the Materials Recovery Facility and Resource Recovery Facility. 12 Includes debt financing on loans provided by the South Lake Tahoe Basin Waste Management Authority. For El Dorado County's portion of the debt financing, these MRF and RRF financing amounts will be treated as an allowed cost. 1-13
453
considered an allowable cost (with profit) for
rate setting purposes. STR will then thereafter
purchase and provide the blue and/or green
bags to its customers as determined by the
JPA. The individual jurisdictions will no
longer be required to purchase and provide
blue and/or green bags to their customers.

2. Pass Through Costs
Pass through costs are costs included in rates
charged to customers, however these costs do not
have an associated profit component. Pass through
costs are generally transactional in nature and
often are thought of as costs not associated with
any significant effort performed by the hauler.

The following pass through costs do not earn
a profit, but are included in determining total
revenue requirements to establish solid waste rates:
• MRF principal payments (City of South
Lake Tahoe and Douglas County) 13
• RRF principal payments (City of South
Lake Tahoe and Douglas County) 13
• I 14 nterest expense
• Franchise fees
• RRF fund credit
• Franchise fees.

3. Non-AJlowable Costs
Non-allowable costs are not allowed in rates
charged to ratepayers. These costs are disallowed
because (1) they may not be associated with the
core business, (2) they may be included implicitly
in the profit level allowed by the JPA, or (3) they
may unnecessarily complicate rate regulation
(e.g., income taxes). Costs shown in Exhibit 1-3,
on the next page, are not allowable for rate setting,
and as a result will not be passed onto ratepayers.
13 For El Dorado County, principal payments on the MRF and RRF financing are allowable costs.
14 For El Dorado County, interest on the MRF and RRF financing is an allowable cost.

Table 1-7
Recommended STR Allocation Methods For Costs
Shared with Other Non-JPA Serviced Jurisdictions
Cost Category Allocation Method
Billing costs Number of bills processed
Disposal costs Actual tonnage
Equipment costs (e.g., rental, Truck usage (over
leases, parts, fuel, supplies, representative period)
tires, repair and maintenance,
licenses, permits)
Franchise fees Revenues multiplied by
fee percentage
General and administrative Direct labor hours
costs, management fees
Loans Revenues

4. Cost AJlocations and Methodologies
The franchised hauler should provide
supporting documentation and rationale for the
allocation of expenses between the franchised
areas covered by this manual and non-JPA areas
serviced by South Tahoe Refuse Company .

Examples of the types of expenses which may
require justification for allocations may include:
• Billing costs
• Disposal costs
• Equipment costs
• General and administrative costs
• Loans to or from affiliates
• Loans to or from officers
• Management fees.

The franchised hauler should be prepared to
provide a reasonable and supportable methodology
for these cost allocations. Table 1-7, above,
provides recommended allocation methods for
various costs which may be shared between JPA
and non-JP A jurisdictions.
1-14 Solid Waste Rate Setting Policies and Procedures Manual 454
Exhibit 1-3
Non-Allowable Costs
Category
Amortization of Franchise Purchases
Charitable and Political Donations
Entertainment Expenses
Fines and Penalties
Income Taxes
Cost of Repairs Due to Operator Negligence
Costs Incurred to Serve Other Jurisdictions
(i.e., for non-JPA areas served by STR
(e.g., Forest Service areas))
-- Description
Consistent with the waste management industry, the JPA disallows amortization of franchise purchases because the operating ratio is designed to provide a return to the company sufficient to compensate for the company's investment in the business. • Costs associated with attempting to influence the outcome of any federal, state, or local election, referendum, initiative, or similar procedure, through in-kind or cash contriburions, endorsements, publicity, or similar activities. • Establishing, administering, contributing to, or paying the expenses of a political parry, campaign, political action committee, or other organization established for the purposes of influencing the outcomes of elections.

Costs incurred in hosting social events for clients or suppliers. Examples include costs of tickets, concerts, athletic events, or other performances; room rentals; cruises; entertaining guests at athletic, social, or sporting clubs and on vacation or other similar trips.

Costs associated with violations of, or failure of, the hauler to comply with federal, state, local, or foreign laws and regulations. This category of non-allowable costs can also include costs in connection with alteration or destruction of records, or other false or improper charging or recording of costs.

The operating ratio is provided on a pre-tax basis. To allow income tax expense would unnecessarily add complexity to the rate review process.

Costs of negligence on the part of the hauler which could include accidents or property damage.

The franchised hauler will be compensated for only those costs that can be directly attributable to operations within the franchised boundaries. The franchised hauler should have a clear basis for allocating shared costs to the franchise areas covered by this manual, and those franchised areas not covered by this manual.

The JPA will assess reasonableness of the revenue
and cost projections provided by the franchised
hauler in its Base Year Rate Application. Examples
of rypes of factors the JPA will consider when
assessing reasonableness of projected revenues and
costs are shown in Table 1-8, on the next page.
1-15
455
Table 1-8
Base Year Rate Review
Revenue and Cost Projection Factors ~
Description Factors to Consider in Developing Revenue and Cost Projections Revenues
RC5idential and commercial revenue5 • Projected account growth based on historical account trends, or population trends • Historical changes in tonnage (particularly for the industrial sector) Recycled materials sales revenue5 • Historical changes in recycled materials volumes • Recycled commodity pricing trends (may be highly volatile) Costs
Direct labor • Projected increases in wage rates
• Planned changes in insurance races
• Planned changes in benefit races
Equipment costs and facility costs • H istorical average trends in costs (last three years) • Inflation rates
• Fuel price history
• Depreciation schedules
• Equipment replacement plans
Landfill disposal fee5 • H istorical changes in refuse tonnage • Tipping fee rate increases, per contract
Office salaries • Projected increases in wage rates
• Planned changes in insurance rates
• Planned changes in benefit rates
General and administrative costs • Historical average trends in coses (lase three years) • Inflation rates
MRF principal payments • Loan documents
lntere5t expense • Borrowing rates
• Loan documents
Franchise fees • Projected changes in revenues multiplied by the fee amount 1-16 Solid Waste Rate Setting Policies and Procedures Manual 456
Section 2
Base Year Rate Setting Process
457

2. Base Year Rate
Setting Process
This section describes each of the eight (8) steps of the base year rate setting process.

Each step includes an overview of the seep and a detailed description of the casks required co complete the step. The section includes eight (8) subsections:

A. Step 1 - Prepare and Submit Rate Application
B. Step 2 - Verify Completeness of Rate Application
C. Step 3 - Review Rate Application and Prepare Response D. Step 4 - Prepare Draft Report and Final Report
E. Step 5 - Present Final Report to ]PA Board
F. Step 6 - Notify Customers of Rate Hearing
G. Step 7 - Receive Approval from City Council and County Boards H Step 8 - Implement New Rates.

A. Step 1 - Prepare and Submit Rate Application
Responsibility: Franchise hauler
Timing: Completed seven (7) months prior to the dace new races become effective Tasks: a.
b.
c.
d.
e.
f.
g.
h.

Overview
Prepare Cost Information
Prepare Revenue Information
Prepare Operating Information
Calculate Allowable Operating Profit
Determine Franchise Fee
Calculate Revenue Requirement
Calculate Net Surplus/Shortfall and Percent Change in Rates Calculate New Percentage Race Change and Races
Prepare and Submit Race Application.

During chis seep, the franchise hauler prepares the Base Year Rate Application. This three-page form includes detailed financial and operating information and is used to determine the actual costs and revenues of the franchise hauler. Blank copies of the Base Year Rate Application are provided in Appendix A (Exhibit A-1).

Several lines in the application contain four columns. These columns are intended to show the relationship between the most recently completed year, the current year, and projections for the new "base" year. These columns are organized as follows:
458
• Column one includes actual audited
information for the franchise hauler's prior
fiscal year. This is the most recent year that
financial information is available and that
actual costs and revenues can be verified.
• Column two is for estimating performance
during the current fiscal year. The "current
year" is the franchise hauler's fiscal year prior
to the new base year. The Base Year Rate
Application is prepared during the course
of the current year. Data in this column
should include year-to-date performance
plus estimated performance during the
remaining months of the current fiscal year.
• Columns three and four are used to report
projected performance during the new base
year. This information is entirely a
projection and is utilized to determine any
rate changes. Projected information should
be developed by estimating anticipated
service levels during the base year, and
determining the revenues and expenses
which will be incurred to provide these
services. Each cost element in the application
should be reviewed and any anticipated
change in specific line items should be
included in the base year projection. For
example, if labor rates are scheduled to
change, or if landfill disposal costs are
expected to change, these changes should be
included in projections for the base year.

The relationship between these four (4) columns
for any given line item should be consistent. Any
substantial difference between each of the three (3)
years should be explained by the franchise hauler and
considered by the JPA during the review process.

The franchise hauler should provide a copy of
audited financial statements for the prior fiscal
year. Financial information from the audit is
consolidated into specific categories identified in
the application. All financial information shall be
in accordance with generally accepted accounting
principles. The franchise hauler should prepare
supplemental documentation which reconciles
the financial audit for the most recently
completed fiscal year to information provided in
the application. This documentation should be
included in the application package.
a. Prepare Cost Information
Cost information from the franchise hauler is
provided in the Base Year Rate Application. Cost
information is reported for the most recently
completed fiscal year, the current fiscal year, and the new base year. Information reported in each line item
represents the total combined costs for residential,
curbside recycling, yardwaste, commercial, transfer
station, and RRF services. Segregation of costs by
residential, curbside recycling, yardwaste, commercial, transfer station, and RRF services is not required.

Cost information includes:
• Allowable Costs
D Direct Labor (Line 5)
D Equipment Costs and Facility Costs (Line 6)
D Landfill Disposal Costs (Line 7)
D Office Salaries (Line 8)
D General and Administration Costs (Line 9)
D MRF Principal and Interest Payments
(El Dorado County) (Line 1 O)
D RRF Principal and Interest Payments
(El Dorado County) (Line 11)
• Pass Through Costs
D MRF Principal Payments (Line 15)
D RRF Principal Payments (Line 16)
D MRF and RRF Interest Expenses (Line 17)'
D Franchise Fees (Line 59)
D RRF Fund Credit (Line 18)
D Recycling Revenue Bonus (Line 19).

Definitions and specific components of these cost
categories are described in Exhibits 1-1 and 1-2,
in Section 1.
' For El Dorado County, interest on the MRF and RRF financing is an allowable cost.
2-2 Solid Waste Rate Setting Policies and Procedures Manual 459
By aggregating costs into these line items, the
JPA, and franchised hauler, can focus on major
changes without becoming distracted by large
changes in insignificant cost components. For
example, if licenses and fees doubled from
$10,000 in the current year to $20,000 in the base
year (i.e., a 100 percent increase), this might only
cause General and Administrative Costs to
increase by one percent, resulting in little impact
on the overall rate. Minor components of General
and Administrative Costs may decrease between
the current year and the base year, while others
may increase.

If one of the major cost line items in the
application changes at an unusual rate, then the
franchise hauler should be able to explain the
change. An unusual change in cost is any change
which is greater than the change in the U.S. City
Average Garbage and Trash Collection CPI. The
CPI used in the analysis should be based on the
most current actual information for the U.S. City
Average Garbage and Trash Collection CPI. This
information is available from the United States
Department of Labor, Bureau of Labor Statistics.

Cost information for the current year, and base
year, must account for any increases or decreases
in the number of customers served, or tons of
waste and recyclable material collected. Actual
increases in costs also must be included. For
example, if health benefit costs will increase in
the base year as a result of increases in premiums,
this additional cost should be included.

Cost information provided in the application
is used with operating profit to calculate the
franchise hauler's revenue requirement. The
revenue requirement is equal to the sum of the
following three categories:
• Total allowable operating costs
• Allowable operating profit
• Total pass through costs.

This revenue requirement is compared to
anticipated revenues. The JPA uses the operating
ratio (OR) method to establish revenue
requirements for setting rates.
b. Prepare Revenue Information
Revenue information is provided in this task.

Similar to cost information, revenues are reported
for the most recently completed fiscal year, the
current fiscal year, and the projected base fiscal year.

Revenues are reported in four (4) separate categories:
• Residential
• Commercial
• Transfer station and RRF revenues
• Recycled material sales.

Revenues in the base year are projected without
any changes in rates. Revenue projections are
prepared based on existing rates and the number
of customers which the franchise hauler
anticipates serving in the base year.

1. Determine Residential Revenues.

To calculate projected residential revenues
for the base year, enter the current monthly
rates by service type in the first column of
cells in lines 22 to 48, on page 2 of 3. Then
enter the projected number of accounts by
service type in the second column of cells
in lines 22 to 48, on page 2 of 3. Total
revenues for each service type are calculated
based on the following:

Multiplied lzJ
Equals
Current rate per month
Twelve months
Rate per year
Multiplied lzJ Projected residential accounts
Equals Revenues by service type.

Revenues by service type then are entered in
the third column of cells in lines 22 to 48,
on page 2 of 3. These values then are added
together, entered, and totaled in line 49.

Residential revenues should reflect all revenues
2-3
460
generated for providing curbside collection
services of refuse, recyclables, and yardwaste.

The number of accounts in each service
category may change throughout the year.

For example, some customers may request
one can service part of the year and an
additional can during the remainder of the
year. The average number of accounts by
service type should be used in these
calculations. In addition, the number of
accounts identified for these calculations
must agree with operating data provided in
Section VIII (page 3) of the application.

Multi-family can, cart, and bin services, and
mobile home park can, cart, and bin services,
should be included in residential revenues.

2. Determine Commercial Revenues.

Commercial revenue information is entered
in line 54 of page 2 of 3 of the application.

In the first column of this line, actual
revenues generated by commercial accounts
during the prior year are reported. This year
amount must reconcile with the financial
audit for that same year. Commercial
revenues for the current year are based on
actual revenue to-date plus an estimate of
the revenues that will be received through
the end of the fiscal year. Commercial
revenues in the current year should be
comparable to revenues in the prior year,
after taking into changes in accounts and
service levels.

Projected commercial revenues for the new
base year are entered in the third and fourth
columns. These amounts, net of any projected
uncollectible accounts, are based on the
estimated annual revenues received during
the current fiscal year plus any additional
revenues generated from additional accounts.

Operating data provided in Section VIII
(page 3) of the application should support any
service level changes.

In order to analyze changes in commercial
rates, rate information must be provided for
specific commercial services. These services are:

Bin Service (Compacted
and Uncompacted)
D 2 Yard Bin-once per week
D 3 Yard Bin - once per week
D 4 Yard Bin - once per week
D 5 Yard Bin - once per week
D 6 Yard Bin - once per week.

In the columns of lines 74 through 78, the
franchise hauler enters the rate for these
services for the prior year, the current year,
and the base year, respectively. Percentage
changes then are entered in columns 3 and

6. This information substantiates previously
approved changes in commercial rates.

3. Determine Allowance for Uncollectible
Accounts. The franchise hauler likely will
not be paid by all customers served. While
this amount is expected to be relatively
small, it must be accounted for in the
calculation of base year net revenues. These
amounts are reported in two places for each
service type: on line 50 for the allowance
for uncollectible residential accounts, and
line 53 for the allowance for uncollectible
commercial accounts.

These amounts can be calculated based on a
formula, such as one percent of anticipated
revenues, or based on actual experience.

Assumptions related to the projection of
uncollectible accounts must be documented and
included as a supplement to the application.

4. Determine Transfer Station and RRF
Revenues. Transfer station and RRF
revenues are included in the total revenue
calculation. In the first column of line 55,
actual revenues received during the most
recently completed fiscal year are reported.

In the second column of line 55, estimated
revenues for the current year are reported.

For the base year, transfer station and RRF
revenues are determined by the best estimate
of transfer station and RRF operations
during the new base year. The projected
revenues are reported in the third and fourth
columns of line 5 5 of the application.
2-4 Solid Waste Rate Setting Policies and Procedures Manual 461

5. Determine Revenues from Recycled
Material Sales. In addition to revenues
generated through residential and
commercial services, and from the transfer
station and RRF, additional revenues are
generated by selling recyclable materials
collected through the curbside re_cycling
program. The amount of recycling revenues
generated through the sale of these
materials is dependent upon the quantity
of material collected and the market price
for these materials. Both of these factors
are outside direct control of the franchise
hauler. Therefore, revenues generated by
recycled material sales are not subject to
an across-the-board rate changes. Revenues
generated from charging residential
customers for curbside recycling services
should not be included here, but should
be included as part of residential revenues
(#1 above).

In the first column of line 56, actual
revenues received during the most recently
completed fiscal year are reported. In the
second column of line 56, estimated
revenues for the current year are reported.

For the base year, revenues from recycled
material sales are determined by projecting
scrap prices for recycled materials and the
anticipated quantity of materials sold. The
projected scrap prices are multiplied by the
projected volume of materials to be sold
to determine projected recycled materials
sales revenues. These projected revenues are
reported in the third and fourth columns of
line 56 of the application.

6. Calculate Total Revenues. The calculation
of total revenue is as follows:

Total residential revenues (Line 51)
Plus Total commercial revenues (Line 54)
Plus Transfer station and
RRF revenues (Line 55)
Plus Recycled material sales (Line 56)
Equals Total revenues.

Total revenues are entered on line 57.
c. Prppare Operating Information
During this task, non-financial operating
information is compiled by the franchise hauler.

Operating information, requested in the application,
provides an important indicator of the franchise
hauler's performance. If costs are changing at an
unusual rate, operating data may provide some
explanation of these changes. For example, cost
increases could be attributed to the increased level of service provided (i.e., accounts served). The franchise hauler should provide the following information:
• Number of accounts
• Quantity of refuse tonnage collected
• Quantity of recycling tonnage collected
• Quantity of yard waste tonnage collected
• JPA bins provided.

Similar to cost data, the first year is "historical,"
the second year is the "current" year, and the third
year is the "base" year. Historical data are based
on actual annual operating statistics during the most
recently complete fiscal year and reflect the same
year used in the financial sections of the application.

Current year performance is based on performance
to-date plus estimated performance for the
remaining months of the current year. Projected
base year data represents the franchise hauler's best
projection of service levels during the new base year.

Year-to-year percentage changes then are
determined for each set of operating metrics. The
franchise hauler should be able to explain any
significant changes. A significant change in an
operating characteristic is an increase or decrease
of more than two (2) percent.

This information allows both the JPA, and the
franchise hauler, to monitor changes in the service
characteristics, estimate total revenues at existing
rates, and compare these to changes in total costs.

The franchise hauler should identify to the JPA
any operating information submitted as part of the
application that it considers confidential.
2-5
462
d. Calculate Allowable Operating Profit
For the historical year of actual data, the
franchise hauler will calculate the actual operating
ratio based on the formula below:

Divided bv
- Equals
Total allowable costs
Total allowable costs plus
Operating profit
Operating ratio.

These actual operating ratios on allowable costs
will reveal how well past base year projections
corresponded to actual results. Similarly, the
formula estimated above is used to calculate the
operating ratio for the current year (column 2).

The actual operating profit received by the
franchise hauler in the most recently completed
fiscal year is entered on line 13, column 1. The
estimated operating profit for the current fiscal
year also is entered on line 13, column 2.

To calculate the allowable operating profit in
the base year, the equation below is utilized:

Allowable operating costs
Divided by Operating ratio
Equals Allowable operating revenues
Minus Allowable operating costs
Equals Allowable operating profit.

The allowable operating profit is entered on line
13, columns 3 and 4 of the application.

In each base year, the operating ratio will range
as shown in Exhibit 1-1, which will help stabilize
rate changes and afford the franchise hauler an
incentive to reduce costs.
e. Determine Franchise Fee
The calculation of the franchise fee is not a
straightforward exercise because as revenue is
increased (e.g., via a rate change), so does the
amount of franchise fees increase because
franchise fees are based on a percent of gross
revenues. To calculate the franchise fee for the
base year requires the hauler to calculate the
franchise fee to be paid to each jurisdiction based
on the revenues after a rate change is applied.

Projected franchise fees should be entered on
line 59, columns 3 and 4 of the application.
f. Calculate Revenue Requirement
The revenue requirement establishes the level
of revenues needed to meet all allowable costs
and operating profit. This includes residential
and commercial waste and recycling costs, and
assumes a reasonable profit margin based on the
operating ratio calculation.

Total revenue requirement (without franchise
fees) is determined as the sum of:
• Allowable operating costs (Line 12)
• Allowable operating profit (Line 14)
• Pass through costs (Line 20).

The revenue requirement (without franchise fees)
is entered on line 21 of the application.
g. Calculate Net Surplus/Shortfall
and Percent Change in Rates
The net surplus/shortfall is determined based
on the following calculation:

Revenue requirement (Line 21)
Less Total revenues (Line 57)
Plus Residential and Commercial
Franchise Fees (Line :!2)
Equals Net surplus/shortfall (Line 60).

The projected amount of revenue generated
during the base year from the sale of recycled
materials was calculated in Step 1, #5 of
subsection b.; therefore, any increase or decrease
in revenues required must come from an increase
or decrease in rates.
2-6 Solid Waste Rate Setting Policies and Procedures Manual 463
If applicable, the percent change in existing
rates is calculated as follows:

Net surplus/shortfall (Line 60)
Divided by Total revenues without change
(Line 61)
Equals Percent change in rates (Line 62).

The percent change in rates is entered on line 62
of the application.
h. Calculate New Percentage
Rate Change and Rates
If applicable, the percentage rate change
identified on page 2 of 3, line 62 should be
entered on page 1 of 3, line 1 of the Base Year Rate
Application. Current residential rates for solid
waste collection should be entered on page 1 of 3.

The adjusted rates for each jurisdiction then are
calculated by multiplying the current rate by one
plus the rate change identified in line 1.

To determine new residential rates on page 1
of 3, column one should be added to column two
and the result should be entered in column three.

This column provides the new rate schedule.

Complete current and revised commercial rate
schedules should be provided by the hauler as an
attachment to the application.

1. Prepare and Submit Rate Application
The franchise hauler submits the completed Base
Year Rate Application to the JPA. The application
should include the following items:
• Management Representation Letter.

The management representation letter
transmits the application to the JPA, and
should provide a listing of included
documents. The letter should identify the
requested adjustment in rates and include
a discussion of specific issues which impact
new rates (e.g., significant increases in
labor costs). The letter should state that:

D Management reviewed and accepts
responsibility for the rate application
D The application is based upon
management's judgment of the most likely
set of conditions and course of action
D All significant relevant information
are made available
D Assumptions are reasonable and
are accurate.

An authorized representative from the franchise
hauler should sign and date the application.

This signature provides a certification of the
franchise hauler that the application is
complete, accurate, and consistent with the
instructions provided in this manual.
• Base Year Rate Application. The franchise
hauler should provide a Base Year Rate
Application, including completed application
forms and supporting documentation.

Supporting documentation includes the
current and proposed rate schedules for
residential and commercial customers.
• Supplemental Audited Financial
Information. For applications received after
2010, audited financial statements for the
most recently completed fiscal year should
be included, as well as other documentation
which support operating and financial data
provided in the application. Because audited
financial statements serve as base documents
for the application, statements of revenues,
expenses, and other reports contained in the
application shall be reconciled to the audited
financial statements to provide assurance
that all activities are accounted for.

Once the application materials have been
prepared, the franchise hauler submits
three (3) reproducible hard copies and
one disk copy formatted to the JPA's
specifications. They are submitted to
the JPA. The thirty (30) day review for
completeness will begin upon receipt of
the application.
2-7
464
B. Step 2 - Verify Completeness
of Rate Application
Responsibility: JPA
Timing: Completed within thirty (30) days
after the rate application is submitted
Tasks: a. Verify Financial Data and Format
b. Verify Supporting Documents
and Schedules
c. Notify Franchise Hauler.

Overview
During this step, the JPA ensures that the
application has been fully completed by the
franchise hauler and that the data provided are
consistent. During the 30-day period, the JPA will
obtain from the franchise hauler any information
necessary to complete the application.
a. Verify Financial Data and Format
The JPA staff reviews the application package
to determine if it is complete and ready for
analysis. Detailed analysis of the contents of the
application occurs during Step 3.

The JPA reviewer should determine the following:
• Has the applicant included all required forms?
• Are all forms complete?
• Are audited financial statements included?
• Are all financial calculations
mathematically correct?
b. Verify Supporting Documents
and Schedules
Various documents may be included in the
application package to support the rate change.

The purpose of these supporting documents
should be clearly identified by the franchise hauler.
c ~otify Fnnchise Hauler
If the application is complete, the JPA will notify
the franchise hauler that it will begin the process of
evaluating the application. If incomplete, the JPA
will attempt to obtain from the hauler additional
required information within the 30-day verification
period. A revision of rates shall not be authorized
until the l " day of the first calendar month
following a six (6) month period from the date
that an application is verified to be complete.

C. Step 3 - Review Rate Application
and Prepare Response
Responsibility: JP A
Timing: Completed within one and one half
(1 Yz) months after determining that
the application package is complete
Tasks: a. Review Actual and Projected
Revenue Requirements
b. Review Actual and Projected Revenues
c. Review and Verify Operating Ratio
d. Determine Components of
Requested Change in Rates
e. Review Performance Data
f. Request Additional Data and
Clarification, if Necessary
g. Document Staff Review.

Overview
During this step, JPA staff evaluates the entire
rate application. This review includes examining
significant changes in costs or operating
performance and evaluating explanations of
these changes provided by the franchise hauler.
a. Review Actual and Projected
Revenue Requirements
In this task, costs and operating profits are
reviewed and analyzed for reasonableness.

Reconciliations of costs to audited financial
statements are checked for consistency. Explanations
2-8 Solid Waste Rate Setting Policies and Procedures Manual 465
are sought from the franchise hauler for items
significantly different than would otherwise 1
normally be expected.

Percentage changes in costs for the three years
identified on the application should be calculated
and reviewed. Projections prepared from previous
years in prior Base Year Rate Applications are
compared with actual results. Costs are correlated
with operating collection efficiency statistics
provided by the franchise hauler.

Any unusual trends or variances in aggregate
areas should be explained by the franchise hauler.

An unusual increase would be a change in cost
which is greater than the change in the Trash and
Garbage Collection CPI, published by the Bureau
of Labor Statistics, and which cannot be attribured
to changes in the number of customers serviced or
tons of waste or recyclable materials collected. If
these unusual changes are not adequately explained
in the application, the JPA should request
additional clarification from the franchise hauler.

The JPA should review the allocation
methodology used by the franchise hauler to
allocate costs between ( 1) franchise areas that are
the subject of this manual, and (2) non-JPA areas
serviced by STR. At a minimum, the JPA should
check that allocations used to assign costs to
franchise area customers are reasonably consistent
with other operating metrics such as average
number of accounts and tons collected.
b. Review Actual and Projected Revenues
The JPA should review actual and projected
revenues in this task. Current rates provided in
the application are verified. Any changes in the
number of customers serviced should be identified
and explained by the franchise hauler.

The application requires the franchise hauler
to report three years of revenues: (1) actual prior
year, (2) estimated current year, and (3) projected
"base" year. For applications received after 2010,
the JPA should reconcile the most recent year
revenues with audited financial statements.

Revenues for the current year are compared with
year-to-date un-audited financial statements and
documentation supplied by the franchise hauler.

Projected revenues for the third, or "base" year,
are evaluated by the JPA for reasonableness.

Assumptions made by the hauler in preparing these
projections are reviewed. Revenues reported by the
franchise hauler should not include any rate changes
in the base year (year 3). Account information
included in the application is reviewed to determine
changes in the number of accounts served.

Allowances for uncollectible accounts also are
reviewed. These figures should be deducted from
total revenue projections. These allowances may
be based on a fixed percentage of total revenues
or on actual experience. Assumptions related to
allowances for uncollectible accounts should be
reviewed with the franchise hauler.

Revenues from recyclable material sales are
provided in the application. Amounts identified
in the prior (first) year provided should reconcile
with the financial audit. Amounts identified in
the current (second) year, the base (third) year
should be documented by the franchise hauler.

The JPA will review these projections to ensure
they are consistent with trends in recycling
collection costs, scrap values, processing costs,
as well as estimated diversion rates and tonnage.
c. Review and Verify Operating Ratio
The operating profit must be determined for the
base year. The JPA should calculate the projected
operating profit for the base year using the first
formula provided in Exhibit 1-1. For El Dorado
County, if the operating ratio is outside the 87 to 91
percent range, then the operating ratio should be
reset to 89 percent. If there are any errors by the
hauler in calculating the operating ratio, or allowable operating profits, these deficiencies are noted.
2-9
466
d. Determine Components of
Requested Change in Rates
The ]PA evaluates all costs, revenues, and
operating profits provided in the application to
determine components of the requested adjustment
in rates. This would include determining the
proportion of the requested adjustment in rates
which is due to changes in each of the following:
• Costs
• Residential revenues
• Commercial revenues
• Transfer station and RRF revenues
• Recyclable material sales revenues
• Operating profit (or loss).
e. Review Performance Data
The ]PA reviews and analyzes performance data,
which are included in the application (the number
of accounts and tons collected). Operating statistics
are reviewed to explain past historical trends and
justify future expenses. Both actual and percentage
increases are examined and any unusual changes
in performance are investigated to determine
their cause and effect on future cost performance.

Changes in accounts served, the number of routes,
tons collected, or direct labor hours generally
should correspond to changes in costs and revenues.
f. Request Additional Data and
Clarification, if Necessary
Throughout the analysis of the application, The
]PA may request clarification and/or additional
data from the franchise hauler to explain any
unusual changes in costs or operating performance.

The ]PA may have identified missing information,
or changes in the financial or operating data
between the three years which require clarification
or further explanation. The franchise hauler
should respond to the JPA's request for additional
information within two weeks. Responses will vary
depending on the specific requirements of the JP A.
g Document Staff Review
During this task, the ]PA prepares workpaper
documentation of the review of the Base Year
Rate Application.

D. Step 4 - Prepare Draft Report
and Final Report
Responsibility: JPA
Timing: Completed approximately three (3)
months after determining the
application package is complete
Tasks: a. Prepare Draft Report
b. Provide Franchise Hauler
with Copy of Draft Report
and Receive Comments
c. Prepare Final Report.

Overview
A draft report with recommendations from ]PA
staff is prepared and submitted to the franchise
hauler for review. The franchise hauler will review
the draft report. The franchise hauler will have
an opportunity to provide written comments
regarding the draft report. The ]PA will address
these comments and prepare a Final Report.
a. Prepare Draft Report
In this step, the ]PA prepares a Draft Report
including recommendations for a rate change.

The draft report includes the following sections:
• Executive Summary. This is a one or twopage summary of the review process and may include a chart showing current and proposed
rates, and the recommended rate change.
• Introduction and Background. The
section identifies any proposed changes in
services provided by the franchise hauler.

The section also identifies the review goals,
objectives, scope, and other relevant
background information. This section
of the report may provide a brief overview
2- 10 Solid Waste Rate Setting Policies and Procedures Manual 467
of the rate change process and a discussion
of significant historical rate issues. If
applicable, this report will document the
rate change proposed by the JPA.
• Analysis and Discussion of Rate
Application. This section of the report
will include a review of the analysis work
completed by JPA staff. This section
might include the following subsections:

D Review of Rate Changes, including a
discussion of interim year rate changes
since the last base year, the relationship
of these changes to changes in the
Garbage and Trash Collection CPI, and
an analysis of the significant components
of the change in rates (e.g., changes in
labor costs.)
D Analysis of Projected Costs, including a
discussion of any unusual changes in
costs which were discovered and
unresolved during the review process.

D Discussion of Service Issues, including
changes in frequency or type of curbside
service. If significant service issues are
not involved with a rate change, this
subsection would be omitted.
• Recommendations. JPA staff would
present its recommendations regarding
specific changes in rates in this section of
the document.
• Appendices. Appendices to the report
would include:

D Rate application
D Revised rate schedule
D Audited financial statements of the
franchise hauler
D Other relevant supporting materials
provided by the franchise hauler.
b. Provide Franchise Hauler with Copy of
Draft Report and Receive Comments
During this task, the franchise hauler will
review the drafr report. Each section of the report
should be reviewed to ensure that correct data are
included, the JPA's analysis is consistent with the
methodology, and if applicable the proposed rate
change is determined accurately.

If any issues are identified during this step,
the franchise hauler works with JPA staff to fully
explore and resolve these outstanding issues.

The franchise hauler then will prepare a written
response to the draft report. The response may
cover one or more of the following topics:
• If data discrepancies exist in any of the
areas noted in the prior task, the JPA
should be notified of these discrepancies.
• If the analysis conducted by the JPA can
be clarified or considered differently, this
information should be provided to the JPA.
• If the report is acceptable and no
clarification or comments can be offered,
this should be relayed to the JPA.

If no written response is received by the JPA
within two weeks of delivering the JPA's Draft
Report, then the JP A will assume that the
franchise hauler has no issues with the report.
c. Prepare Final Report
Any additional or outstanding comments or
issues raised during the franchise hauler's review
of the draft report are addressed. If necessary,
meetings are conducted with representatives from
the JPA and the franchise hauler. Final solutions
to outstanding issues are included in the report.

After final comments from the franchise hauler
have been considered, the Final Report package is
prepared. A copy of the Final Report is submitted
to the franchise hauler.
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468
E. Step 5 - Present Final Report
toJPABoard
Responsibility: JPA
Timing: Completed two (2) months prior to the
expected implementation of new rates
Tasks: a. Distribute Final Report and
Summary to JPA Board
b. Obtain JPA Board Recommendation.

Overview
During this step, the Final Report is presented
to the JPA Board for review, comment, and for a
recommendation to the three jurisdictions.
a. Distribute Final Report and
Summary to JPA Board
In this task, the Final Report is provided to
members of the JPA Board. The report is included
as an agenda item for JPA Board consideration
at a regular JPA Board meeting. The rate change
may be placed on either the regular or consent
calendar. The JPA Board Clerk should be notified
four ( 4) weeks prior to the meeting at which the
rate change will be considered and reports should
be provided two (2) weeks prior to the meeting.

The JPA Board Clerk should follow applicable
public noticing requirements, so affected customers
can participate at the Board meeting.
b. Obtain JPA Board Recommendation
The JPA Board members review the report
and proposed rate changes. If the JP A Board
agrees with the recommendations of JPA staff,
the JPA Board recommends the rate change and
rares to the three jurisdictions. If the JPA Board
does not agree with staff recommendations, the
report is returned to JPA staff for additional
analysis. If the JPA Board does nor recommend
the report and rates, the JPA Board should
specifically identify deficiencies.

F. Step 6 - Notify Customers of
Rate Hearing
Responsibility: City and Counties
Timing: Completed 10 days prior to City
Council and County Board meetings
Tasks: a. Prepare Notification of Public
Hearing for Rate Change.

Overview
During this step, the City and Counties notify
customers of the rare setting hearing.
a. Prepare Notification of Public Hearing
for Rate Change
Once the JPA Board has recommended the
report and rares, the jurisdictions will notify
customers chat a rate hearing will occur. This
notification will occur prior to the City and
County rate hearing(s) where each jurisdiction
will consider whether to approve the JPA
recommended rates.

G. Step 7 - Receive Approval from
City Council and County Boards
Responsibility: City and Counties
Timing: Completed one (1) month prior to
expected implementation of new rates
Tasks: a. Distribute Final Report to City
and Counties
b. Obtain City and County Approvals.

Overview
During chis step, the respective cities and
counties within the JPA present the Final Report
for review and approval by their respective city
council and county boards.
2-12 Solid Waste Rate Setting Policies and Procedures Manual 469
a. Distribute Final Report to
City and Counties
In this task, the Final Report is provided to
the City of South Lake Tahoe, El Dorado County,
and Douglas County for review and approval.

The report is included as an agenda item for
consideration at a regular public meeting. The
clerk of each respective jurisdiction should follow
applicable public noticing requirements.
b. Obtain City and County Approvals
The City of South Lake Tahoe City Council,
the El Dorado County Board of Supervisors, and
the Douglas County Board of Commissioners
review the report and recommended rate
changes. If the rate changes are approved, they
are implemented. 2
2 Douglas County's rates are subject to a voter-passed initiative that requires the approval of the voters if the rate will increase by ten percent or more. The rate adjustments provided for in this manual are therefore subject to the Douglas County Code and Douglas County will not be in violation of its agreement with STR if a rate adjustment is not approved because it fails to obtain the required voter approval.

H. Step 8 - Implement New Rates
Responsibility: Franchise hauler
Timing: Conducted following City Council
and County Board approval of the
new rates
Tasks: a. Implement Rate Change.

Overview
During this final step, the franchise hauler
implements new rates, if applicable.
a. Implement Rate Change
During this final task, the new rates are
entered into the franchise hauler's billing system
and included in the billing cycle. If a rate change
occurs during the middle of a billing cycle,
unbilled or overbilled amounts are calculated
and included in the next billing cycle.
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470
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2-14 Solid Waste Rate Setting Policies and Procedures Manual 471
Section 3
Interim Year Rate Setting Process
472

3. Interim Year Rate
Setting Process
This section describes each of the four (4) steps of the interim year rate setting process. Each step includes an overview of the step and a detailed description of the tasks required to complete the step. The section includes four (4) subsections:

A. Step 1 - Prepare and Submit Rate Application
B. Step 2 - Prepare Draft Report and Final Report
C. Step 3 - Receive Approval from City Council and County Boards D. Step 4 - Implement New Rates.

A. Step 1 - Prepare and Submit Rate Application
Responsibility: Franchise hauler
Timing: Completed four (4) months prior to the implementation of the new rates Tasks: a. Prepare an Interim Year Rate Application
b. Submit Application to JPA.

Overview
During this first step, the franchise hauler prepares the Interim Year Rate Application.

Blank application forms are provided in Appendix A (Exhibit A-2). Similar to the base year forms, these forms identify all areas to be completed with double outlined boxes. If data are to be entered in the form, the box has no shading. If a calculation is required, the box has light shading.
a. Prepare an Interim Year Rate Application

1. Report Changes in Landfill Disposal Costs. The first task is to provide prior year landfill disposal costs. Prior year landfill tipping fees per ton should be entered on line 1. Prior year landfill tonnage should be entered on line 2. The values entered on lines 1 and 2 should then be multiplied together and entered on line 3.

The franchise hauler estimates what landfill tipping fees and landfill tonnage will be for the next interim year. Projected interim year landfill tipping fees, per ton, are entered on line 4, and projected interim year landfill tonnage is entered on line 5.

The values entered on lines 4 and 5 then are multiplied together and entered on line 6.

The percent change in landfill disposal costs is determined as follows:
line 6 - line 3
line 3.

The result of this equation, rounded to the nearest one decimal place, is entered on line 7.
473

2. Explain Changes in Landfill Disposal
Costs. Any changes in either landfill tipping
fees or tonnage should be fully explained
in this task. For example, if a landfill closes
and the franchise hauler begins using a new
landfill with higher tipping fees, this
information should be disclosed.

Documents which suppon or further explain
any change in costs are provided, as
appropriate. This might include formal
announcements of tipping fee increases
provided by the landfill operator, which will
be paid directly by the franchise hauler.

3. Certify Application. An authorized
representative from the franchise hauler
should sign and date the application.

This signature provides certification by
the franchise hauler that the application
is complete, accurate, and consistent with
the instructions provided in this manual.

At this point, the application should be
complete. The application is submitted
to the JPA for review and calculation of
the rate change, as described in the
following subsection.
b. Submit Application to JPA
The completed application is sent to the JPA
for review and calculation of new rates. The
franchise hauler's application does not include
any new rates; these are determined by the JPA
during Step 2.

B. Step 2 - Prepare Draft Report
and Final Report
Responsibility: JPA
Timing: Completed within two (2) months
of receiving a completed Interim Year
Rate Application
Tasks: a. Identify Consumer Price Index
b. Complete Interim Year Rate Change
Worksheet and Determine New Rates
c. Request Additional Data and
Clarification, if Necessary
cl. Prepare Draft Report
e. Receive Comments from
Franchise Hauler
f. Prepare Final Report.

Overview
The Interim Year Rate Change Worksheet is
used to calculate new interim year rates. This
document is prepared by the JPA after the
franchise hauler has submitted an Interim Year
Rate Application. Interim year rate changes .are
based on a weighted increase in operating and
landfill disposal costs. Inflators for this process
include changes in the Consumer Price Index
(Garbage and Trash Collection CPI) and changes
in landfill disposal costs (documented by the
franchise hauler in the Interim Year Rate
Application). Exhibit A-3 in Appendix A
includes a sample of the two-page worksheet to
be completed by JPA staff.
a. Identify Consumer Price Index
The annual change in the U.S. City Average,
Garbage and Trash Collection, Consumer Price
Index (CPI) provides the single largest factor for
determining new rates during interim years.

Eighty-five (85) percent of the actual change in this
index during the twelve months prior to the date
the Interim Year Rate Application is submitted
to the JPA is used for the actual change in the
methodology. Because a projected change in the
3-2 Solid Waste Rate Setting Policies and Procedures Manual 474
CPI is not produced, eighty five (85) percent of the
actual change in CPI for the prior twelve months is
used as the CPI for the interim year. The period
used by the J PA and franchise hauler will be June
to June. This information is available from the
United Scates Department of Labor, Bureau of
Labor Statistics.
b. Complete Interim Year Rate Change
Worksheet and Determine New Rates
JPA staff prepares the Interim Year Rate
Change Worksheet and calculates new rates during
this task. This worksheet requires information
from the most recent Base Year Rate Application
and the current Interim Year Rate Application.

This worksheet also requires the U.S. City Average
Garbage and Trash Collection CPI information
collected in task a. The worksheet is used to
calculate the new rate change.

1. Identify Prior Base Year Operating Costs
(Other Than Landfill Disposal). Operating
costs, excluding landfill disposal costs, are
those items which can be reasonably
managed by the franchise hauler in order to
minimize future rate increases. Changes in
these costs should approximate the change
in the U.S. City Average Garbage and Trash
Collection CPI.

In order to streamline the interim year
process, operating costs are adjusted based
on an annual change in the CPI instead of
projected changes in each cost item. This
eliminates the need to conduct a derailed
review of the franchise hauler's audited
financial statements.

Landfill disposal costs are included in total
allowable costs (line 1). Because of chis, landfill
disposal costs must be deducted to determine
total operating costs (ocher than landfill
disposal) in the base year (line 1 plus line 2
plus line 3 minus line 4). This total then is
entered on line 5 of the worksheet and is used
to calculate the weighted change in operating
costs (ocher than landfill disposal).

2. Identify Prior Base Year Landfill Disposal
Costs. Landfill disposal coses are chose items
over which the franchise hauler has liccle or
no control. Adjustments to landfill disposal
costs during an interim year are based on the
franchise hauler's projections, not projected
changes in the CPI. Total landfill disposal
costs in the prior base year must be
calculated to determine the weighting of
operating costs to landfill disposal coses.

Landfill disposal coses from the base year are
entered in line 6.

3. Calculate Weightings. Total operating costs
(other than landfill disposal) (line 5) plus
total landfill disposal costs (line 6) equals the
total base year revenue requirement. This
total is entered on line 7 of the worksheet.

A weighting for both operating costs (other
than landfill disposal) and landfill disposal
costs is calculated as follows:

Operating Costs
(Other Than Landfill Disposal):

Divided by
Total operating costs (Line 5)
Base year revenue
requirement (Line 7)
Equals Operating costs (other than
landfill disposal), as a percentage of
base year revenue requirement.

This percentage figure is entered on line 5,
column 2, and line 17.

Landfill Disposal Costs:

T oral landfill disposal costs (Line 6)
Divided by Base year revenue
requirement (Line 7)
Equals Landfill disposal costs, as a percentage
of base year revenue requirement.

This percentage figure is entered on line 6,
column 2, and line 20.

4. Calculate Projected Change in Consumer
Price Index. The percent change in the
prior year June to June U.S. City Average
Garbage and Trash Collection, CPI is entered
3-3
475
on line 8. This change in CPI then is adjusted
by multiplying the figure on line 8 by 85
percent and the result entered on line 9.

This adjusted projection of the change in CPI
also is entered on line 18 of the worksheet.

5. Enter Landfill Disposal Cost Information
from Application. The figures on lines 1
through 7 of the application (actual and
projected landfill disposal costs) are entered
in lines 10 though 16, respectively, of the
worksheet. Any significant changes in these
costs are documented by the franchise
hauler. A significant change would be any
increase greater than the change in the CPI,
or a decrease of any amount. If a significant
change has not been adequately explained,
additional information is requested from the
franchise hauler.

6. Review Mathematical Accuracy. The
mathematical accuracy of the franchise
hauler's totals for T oral Prior Year Landfill
Disposal Costs (line 12), and Total Projected
Interim Year Landfill Disposal Costs (line
15) are checked during this task. The percent
change in landfill disposal costs should be
calculated as follows:
line 15 - line 12
line 12.

After the percentage change in landfill
disposal costs has been verified, this figure is
entered in lines 16 and 21 of the worksheet.

7. Calculate Weighted Change in Operating
Costs (Other Than Landfill Disposal).

Figures should have been entered on line 17,
operating costs (other than landfill disposal) as
a percent of base year revenue requirements,
and line 18, the adjusted projected change in
CPI, based on calculations completed in
previous tasks. To obtain the weighted change
in operating costs (other than landfill disposal),
line 17 is multiplied by line 18 and the result
entered on line 19.

8. Calculate Weighted Change in Landfill
Disposal Costs. Line 20, landfill disposal
costs, as a percent of base year revenue
requirements, and line 21, projected change
in landfill disposal costs, should now have
an entry based on calculations completed
in previous tasks. To obtain the weighted
change in landfill disposal costs, line 20 is
multiplied by line 21 and the result entered
on line 22.

9. Calculate Total Change in Cost. To
calculate the total percentage change in costs,
line 19, the weighted change in operating
costs (other than landfill disposal), is added
to line 22, the weighted change in landfill
disposal costs, and the result entered on lines
23 and 26, total percent change in costs.

10. Calculate Franchise Fee Adjustment. In
order to account for changes in the franchise
fee resulting from a change in rates, an
adjustment is made to the percentage change
in total costs which was entered on lines 23
and 26. The adjustment factor is equal to
one minus the franchise fee (1.00 - __ =
__ ).These values should be entered on
lines 24 and 27.

11. Calculate Percent Change in Existing Rates.

The final task in this step is to calculate the
percent changes in existing rates. To determine
these changes, line 23 (total percent change
in costs) is divided by line 24 (franchise fee
adjustment), line 26 (total percent change
in costs) is divided by line 27 (franchise fee
adjustment), and the results are entered on
lines 25 and 28. The values on lines 25 and 28
should be greater than the value on lines 23
and 26. The difference accounts for the
change in franchise fees.

12. Enter Rate Change. The rate change
identified in lines 25 and 28 should be
entered on Page l , line 1 of the worksheet.

13. Calculate New Residential Rates. Current
jurisdiction-specific rates for residential solid
waste collection are entered in column one
on page 1. The new rates (in column three)
then are calculated by multiplying the current
rate by one plus the percentage rate change
identified on line 1. The rate adjustment (or
the difference between the rate in column one
and the rate in column three) is entered in
column two.
3-4 Solid Waste Rate Setting Policies and Procedures Manual 476
To verify new rates, column one, lines 2
through 4, should be added to column two
and the result should equal the rate in
column three. This third column provides
the new schedule of residential rates.

The JPA should separately calculate new
commercial rates using the percentage
change in rates.
c. Request Additional Data, and
Clarification, if Necessary
If necessary, JPA staff requests clarification
and/or additional data from the franchise hauler.

The request is to clarify the franchise hauler's
assumptions for projected changes in landfill disposal
costs and to indicate the expected change in rates.
d. Prepare Draft Report
The JPA staff prepares a high level draft report
with recommendations of new rates for JPA
Board consideration. This report should be brief
and include the following sections:
• Executive Summary. This is a summary
of the review process and includes a chart
showing current and proposed rates, and
the recommended rate change.
• Background. This section of the report
provides a brief overview of the rate
change process and discussion of any
significant historical issues.
• Analysis and Discussion oflssues. This
section includes a review of the analysis
work completed by JPA staff. This section
also includes a discussion of any significant
changes in landfill disposal costs and an
identification of the change in CPI
assumed by the JPA.
• Recommendation. The JPA staff presents
its recommendation regarding any change
in rates in this section.
• Attachments. Attachments to the report
would include:

D Rate application
D Revised rate schedule(s)
D Interim Year Rate Change Worksheet.

After the draft report and recommendations
have been prepared, the document should be
submitted to the franchise hauler for comment
and review.
e. Receive Comments from
Franchise Hauler
The franchise hauler reviews the draft report
to ensure that any calculations and analyses
completed by JPA staff are fair, reasonable, and
justified. The franchise hauler reviews the draft
report to ensure the following:
• Correct data are included
• JPA staff analysis is accurate and fair
• Rate changes are reasonable and acceptable.

If any issues are identified during this step,
the franchise hauler works with JPA staff to fully
explore and resolve these outstanding issues.

A written response to the draft report is then
prepared. The response may cover one or more
of the following topics:
• Data discrepancies in any of the areas
noted in the prior task
• Clarification for the JPA or alternative
analysis of the application
• Responses to the JPA's request for
additional information.
f. Prepare Final Report
The JPA prepares the Final Report incorporating
comments from the franchise hauler, as
appropriate. Any comments or issues raised during
the franchise hauler's review of the draft report are
addressed. If necessary, representatives from the
JPA and the franchise hauler should meet to resolve
issues. The report should reflect final solutions to
outstanding issues.
3-5
477
After final comments from the franchise hauler
have been considered, the JPA prepares the Final
Report. The JPA should submit a copy of the
Final Report to the franchise hauler.

C. Step 3 - Receive Approval from
City Council and County Boards
Responsibility: City and Counties
Timing: Completed one month prior to
expected implementation of new rates
Tasks: a. Distribute Final Report to City
and Counties
b. Obtain City and County Approvals.

Overview
During this step, the respective cities and
counties within the JPA present the Final Report
for review and approval by their respective city
council and boards.
a. Distribute Final Report
to City and Counties
In this task, the Final Report is provided to the
City of South Lake Tahoe, El Dorado County,
and Douglas County for review and approval.

The report is included as an agenda item for
consideration at a regular public meeting. The
clerk for each applicable jurisdiction should follow
applicable public noticing requirements so affected
customers can participate at the public meetings.
b Obt· in City and ( ounty Approv·tls
The City of South Lake Tahoe City Council,
the El Dorado County Board of Supervisors, and
the Douglas County Board of Commissioners
review the report and recommended rate
changes. If the rate changes are approved, they
are implemented. If the rate changes are not,
deficiencies are noted, and the report is returned
to the JPA. Step 3 is then repeated. '
D. Step 4- Implement New Rates
Responsibility: Franchise hauler
Timing: Conducted following the approval
of the new rates by the City Council
or County Boards
Tasks: a. Implement Rate Change.

Overview
After new rates have been approved by City
Council and County Boards, the final step in the
process is to implement the new rates.
a. Implement Rate Change
During this final task, the franchise hauler
enters the new rates into their billing system and
includes the new rates on the next appropriate
customer invoice. If a rate change occurs during
the middle of a billing cycle, unbilled or
overbilled amounts are calculated and included in
the next billing cycle.
' Douglas County's rates are subject to a voter-passed initiative that requires the approval of the voters if the rate will increase by ten percent or more. The rate adjustments provided for in this manual are therefore subject to the Douglas County Code and Douglas County will not be in violation of its agreement with STR if a rate adjustment is not approved because it fails to obtain the required voter approval.
3-6 Solid Waste Rate Setting Policies and Procedures Manual 478
Appendix A
Blank Forms and Worksheets
479
Appendix A
Blank Forms and Worksheets
Exhibits A-1 through A-4, on the following pages, include blank base year rate application forms, interim year rate application forms, interim year rate change worksheets, and Consumer Price Index (CPI) percent change calculation example.

This appendix is organized as follows:
• Exhibit A-1 - Base Year Rate Application
• Exhibit A-2 - Interim Year Rate Application
• Exhibit A-3 - Interim Year Rate Change Worksheet.
• Exhibit A-4 - Consumer Price Index (CPI) Percent Change Calculation Example. 480
Exhibit A-1
Sample Bose Year Rote Application
Base Year Rate Application
Summary

1. Rate Ch:snq<'
Percent Rate Change Requested (City of South Lake Tahoe and Douglas County) Percent Rate Change Requested (El Dorado County)
Ram Schedule
(per a.mlomer, per morth) Current Ram Ram AdJU!!!!!Ont New Rate 2 Crty of Sou1h Lake Tahoe
2 1 Unlimil8d M<Vic:e

2.2 Mandabld pockup pet' 321111llon can/bag

2.3 Mandabld ptekup per cubic yard
2 4 Ouaified •nor ram
2 5 HouM •rvice • I can

26. HouseMrvice · 2cana
2 7 House service ~ 3 cans

2.8 Residential · Al other aerv!Cff
3 Oouglas Courrty

3. 1 I , 3211111on can
3 2 2. 321111lon cans

3.3 3, 321111lon cans

3.4 4, 321111lon cans
3 5 One exn 321111lon ctn (aloo the ... oonal Mrvlc<t rate)

3.11 On-cal 3211111on can biled monthly/01Teara

3. 7 Per aJbtc yard
3, 8 1, "5-galon can

3. 9 2, "5-galon cans

3.10 3, "5-galon cans
3 11 One exn 45-galon can (aloo the Maoorml Mnnce ram)
3 12 On-cal 45-galon can biled monthly/arrears

3. 13 Residenoal · Al otlltr Mrvoces
El Dorado County
s •
•
p 'QE
41 4.2 u--Mandated pockup pet' 32.galon can/bag
4 3 Manctabld ptekup P« cubic yard

4.4 Qualifiedaenornne
4 5 HouM •rvice Pef'Cln

4.6 R-noal · Al otlltr aervoces r I' I' I To tilt best of my knowledge, the data and 1nforma1JOn in 1h1t appficallOn 10 compltm. accurate, and consktent Wllh tilt 1nslruciions provided by the Soulh Lake Tahoe BaS1n Wasm Management Authonty Name nt1o
Date
Fiscal Year:

A-2 Solid Waste Rate Setting Policies and Procedures Manual

Page 1 ends

3 481
Exhibit A-1
Sample Base Year Rate Application < '>nt11 I)
Base Year Rate Application
Financial Information for All Three Jurisdictions
Actual Auctt..:1 Estumt.S ~
Pnorv.. CIJrr9tllY•• a-.v .. Al Thr.. Al nw.. aty ot Sl r .nc1 EJ Ootldo ~or. .Jt.lritdictor. Oouglat. c.ounty COunty
$ Dntl'-- s s s s
• E.....-eomond F"""""-
7 L-1-C-.
• Otflee Sllan•
• Gen.Al Ind~\'. Colla
10 MRF_ond_,.....,._(Elllo<odo~)
ff ARF Pnnapat .net I,..,._ °'--(El Ocnda r--...1
12 '°"' .,_ °"""""" CollS s s I I
"I.
"fi EE*fi!MiiiFiMfM"'WS 1' MRI'_...,._ 14 RRF,._P_..
f7 MRF..-dRRFim..t~
18 RRFFundCttcat
1P R~ ...,..,..ac....

20. T04.ll Pas Through Costs
21 , ....... _ °'*"""9 eom"'"" 121 .... - °'*"""9 ....... < ..... "l .... , .... p- I• - C-.(ur. 20) • R•dtrflllRtvtr'Mn
Olyol_ ..... ,_
22 l.Hmit.ct~
2J .._ .. _ ... ~.,.,.,Oii
z.f M..._, ~ ps a8r;yW'd
2' au.16edW'llOI' .....
,. i'IOute:titNU • 1CS'I
21 HaUle MMCe - 2 cs.
28 HouM MMce - 3 c..
2f R...,.•-Al._MMC411
Dougj•~
JO 1 l21Jlllon cen •s=-----t ,, l2~c..
l2. l. l21Jlllonc..
33 32._.on~
.J.f an.unJ2"911anan(lllolhltMmoml'*""ic•r'llll) 1------t 35 Or>col '.12._.,., con - _,.,..,. .)f P•c:ut.e'tl'd
J7 1, 45-gmlon can
JI A~CMS
J9 ). 45-gllonc-. '° O\eertra ~Clr'l lllO .... .,...Ml'Vl(e,.., t-----t -4f <hall~ CM tded "'°""VI.,...
42 R..-. .. . AIOINt-MMOtt
EIOo<odo~
0 l..ll*na.dSM"itee
.. 4$ --!!-............... ... 32-~ .....
49 A...,.al......,_~
"1 Uw ort.h::cllecc.bleR•.,.•Acco.wllll
$1 fout ~ Atv.,_,..fwdtout R• °*'Oe 111 a.. Y...,
$2 eo..wn.a11 Rev.,.,.,.

53. La-. AIOllMnCe for t.hoolectibl• Comnwta• Atxolllt& " " ,.
$7
T• Comtneto• R.v.,.,_ CUI~ C.,.,,. in S... Vtwl
r,.,..,. sea.on Ind RRF "-"'~
R MactfitllS.....
12 12
12 12
12 12
12 12
12 12
12 12
12 12
12 12
12 12
12 Is
'' fotll ~- ConwlMtaail r...-... $1Rotl Ind R.Rf Rev--.- Prior IO-·~ (Une $' • 54 .._ 55> '2 Pttc«110..n&'1&1n9R•dlnllallCommwa.uTr.S•~Rac- UnelSO·lxt981 ) Fiscal Year:

Is Is Is
l/ '
,
A-3
482
Exhibit A-1
Sample Base Year Rate Application 0nt11 1)
Operating Information

63. Residential Accounts

54. Multi-family Accounts

65. Commercial Accounts

66. Total Accounts

67. Residential Refuse Tons

68. Residential Recycling Tone
69 Relidential Yard Waste Tons

70. Commercial Refuae Tons

71. Commercial Recycling Tons
72 "Free" Drop Boxes Provided (Monthly}

73. "Free" Bins Provided

74. 2 Yard Bin-Once per Week

75. 3 Yard Bin-Once per Week

76. 4 Yard Bin-Once per Week

77. 5 Yard Bin-Once per Week

78. 6 Yard Bin-Once per Week
Fiscal Year:

Base Year Rate Application
I
Prior Year Current Year
Audited Estimated
Information Information
All Three All Three
Junsdlcilons Junsdicbons
Percent
Change
Base Year
Projectad
lnfotm.11ion
City of SL T Ind El Dorldo
Douglu County County •.•• ,, .•.•
~
~I :1
•••1•1 111--ill
I I ~
A-4 Solid Waste Rate Setting Policies and Procedures Manual I
I
I
Percent
Change
I
I
~
!

Page 3 ends

483
Exhibit A-2
Sample Interim Year Rote Application
Chang• In Landntl Olspoul Costs
Interim Year Rate Application
Poor YHt LlndU Trppiog Fen Pet Ton
Pnot YUi LandM T~
1 Equ•ls. Total Pno< Yow l.ondfill DiepoNI Cosio
Year:

Pro,octod lnlonm Yoor l.ondlil Topping F- Per Ton
P "*'nmYewllndfilTona
Total F'ro_.i lni.rim Year Landfill Oospoool CoS10
Provide •n txpl•n•Uon of •"Y chenges In londl1ll ctspoul coats (1 t , l•nd!lll Uppng fees poid by !ht h•ncllite heuler, lendfill tonnage) Attach 1upporting documentation to this apphceUon aa appropnate To !ht - of my knowtodgo. lht do1a ond --in fw• pptica'"'",. C0111>1olo, 1<euro•. - con 19nt 'Mtll lht "1ltNctioM provided by 1hO SOutll Lake Tahoe Basin Was"' Management Authonl)' T""'
Cal10n C1ry Total
p 1 of1
A-5
484
Exhibit A-3
Sample Interim Year Rate Change Worksheet
Interim Year Rate Change Worksheet
Summary

1. Percent Rate Change Requested (City of South Lake Tahoe and El Dorado County) Percent Rate Change Requested (Douglas County)
Rate Schedule
(per customer. per month) Current Rate Rate Adjustment
2 Cly of South lake Tahoe s $

2.1 Unhmted """"'" 2.2. Mandated plClcup pe< 32-gallon can/bag

2.3 Mandated pckup pe< c\lbic ywd
2A Qualified senior race

2.5. House Hf'Vtee • 1 can

2.0 House service • 2 cans
27 House aervtee • 3 c.-.

2.8. Retidtnoal - Al other S«Voces

3. Douglas County
31 1, 32-galon can $ s
32 2. 32-galon cans
33 3, 32-galon cane
34 4, 32-galon cans

3.5 One exlnl 32-gallon con (also the seasonal Se<Vrce - J

3.0 On-call 32-gallon can bolled monthly/wrea-s - 37 Per cubic yard 38 1, 45-galonCSI
3g 2, 45-galon cone
310 ~aloncane
311 One txlnl 45-gallon con (also tho seasonal se<Vlet rota) 312 On-call 45-gallon con bolled monthlytwrears - - 3.13 Retidential - Al other servocos

4. El Dorado County
41 Unhmtad service $ $
42 Mandated pickup pe< 32-gillon carVbag
43 Mandated pckup per c..C.C yatd
44 Qualified-- - 45 ....._ t orvict per can
46 Rtfldtn al • Al other servoces
Year:

A-6 Solid Waste Rate Setting Policies and Procedures Manual P0g1' Io
NewRate
$
$
-
·-
$
~ 1 of2
485
Exhibit A-3
Sample Interim Year Rate Change Worksheet 0 ,ntinued)
Interim Year Rate Change Worksheet
Financial Information
1 2.

3. 4.

5. 6.
7 8.

9. 10.

11. 12.

13. 14.
15 16.
17 18.

19. 20.
21 22.
#§§i:@Mti3.fi(
Base Year Operating Costs (Other Than Land"H Disposal)
Total Allowable Operatilg Costs
Plus. Allowable Operating Profit
Plus. Total Pass Through Costs
Minus: LandM Disposal Costs
Equ•ls: Total Operatilg Costs (Other Than LandfiH Disposal) B11e Year Land"ll Disposal Costs
Total Landfill Disposal Coats
BH• Year Revenue Requirement
ti§i13ifii.I.1¥Ji.IR.J1£
Change In Operating Costs (Other Than Landftll Dlsposll) Projected Change in Consumer Price Index
Projected 85 Percent Change in Consumer Price Index
Change In LandftM Disposal Costs
Mu#ip/ied b
Equals:

MuH · . d b .

Equals:

Prior Year Total Landfil r ipl>i'g Fees Per Ton
Prior Year Total Landfil Tons
Total Prior Year Total Landfil Disposal Costs
Projected Intern. Year Total Landfill Tipping Fees Per Ton Pro'ecied Intern. Year Total Landfill Tona
Total Projected Interim Year Total Landfill Disposal Costs ProJecied Change In Total L•ndfill Disposal Costs
M§iililMflMll!lll.llQ§ld§·•••.;1.1:141.i;MIC
W.lghllld Change In Operating Costs (Othar Than Land"ll Dlsposal) Welghllld Change In Total Landftll Dlsposal Costs
Total Landfitt Disposal CoslS as 'II of Base Yr Revenue Requinlment Pro cied Chan e in Total Landfil D' sal Costs
Weightod Change in Total Londfil Disposal Costs
Total Chang•
$
s
$
s
M

23. 24

25. Total Percent Change l'I Costs 1._ ____ """'1 '11
AdJustmentforFranchtse Fee (1 - 'II) I 'II

26. 27

28. Year:

D1vldadby:

Equals:

Divided by.

Equals.

Percent Change In Existing Rates (City of South Lake Tahoe and El Dorado County) Total Percent Change in Costs I
Adjustment for Franchl98 Fee (1 - 'II) I
Percent Change In Existing Rates (Douglas County)
Page2of2
A-7
486
Exhibit A-4
Consumer Price Index (CPI) Percent Change Calculation Example Consumer Price Index (CPI) Percent Change Calculation Example lnlerimYHr: 2011
At>fllk .. 1on s..-.1on by: llJl/2010
Applk- CPI da .. UHd JuM leot to June 1010
Consumer Pri" lndn - All Ul'ban Consumers
- Id! CWROOOOSEHG02
Nol 5enonally ~od
,.,_ U.S. ""'f ......._
Item: Garbogo and lnlShllaM Period: DECEMBER 11183>100 -l"l.W. y- - - - - 267.l .MU 2lil.2
- 27l.I 27l6 27l.]
- -4 2*>9 211.1
- 2116.2 217.l 211.4
- 299.4 JOO.I :IOl.2
- l07.4 JOU J09.6
- 323 32<6 325.3
- 340.1•7 - 342.QJJ
- 356.901 351059 ]51.55
- m .m 372.30] J7l.241
»10 JI0.036 312.49 Jll.362
Consumor Pike - os ol June 200ll
Consumtr Pike - as ol June 2010
Chengo In Consumot Pnce lndu
-c-1n Consumo< Pike -
-261 l
27l.7
2121
290.l
JOll
JI0.2
326.1
343 216
lS9.Sl6
375 392
JIJ.615
37&582
31] 749
7107
t.~
-
Ml
274
292.2
291
JOI 7
l ll?
3273
343.l!lll
J61SD
375.5199
JIJ.4115
- ... - - Od
2692 2104 271.l 2716 271.1 -m1 >24.:1. - 2"'-" 211 211.6 ~ __ , .. I I U I - l 214.1 21S.I
- .-1.J. . -- · 2'4.1 m l02.4 J0).5 "llM2 l052 l05.9 l06.7 312.5 ]14.J JIS4 Jl7.l 119.1 32Cl.6
3211 3296 DU ll4l DS9 3J69
341136 345(111 347 14511 347.949 341.6M JS11Jfi,
J6l.IS9 l66.00 JQ96 )69 65 1 371 .155 371.641
37".512 in . .,. 377119 311.215 379.56 379.1(11
383.7,.g llJ.ll2 315.01 315.92 315909 311.116
A-8 Solid Waste Rate Setting Policies and Procedures Manual -
2719
Z116
215.4
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ATTACHMENT C
CROWE HORWATH REPORT (BASE YEAR 2018

RATE ANALYSIS OF STR)
488
Crowe Horwath.

November 12, 2017
Authority Staff
South Lake Tahoe Basin Waste Management Authority
1901 Airport Road
South Lake Tahoe, CA 96150
Subject: Base Year 2018 Rate Analysis of South Tahoe Refuse Company Crowe Honvath LLP
lnde pe nd nt Member Crowe Horwath ln1t!mat1onal
575 Market Street, Suite 3300
San Francisco, Cali fornia 94105-5829
Tel 4 15.576.1100
Fax 4 15.576.1110
www.crowehorwath.com
Crowe Horwath (Crowe) has completed its analysis of South Tahoe Refuse Company's (STR's) Base Year 2018 Rate Application (Application). The South Lake Tahoe Basin Waste Management Authority (JPA) contracted with Crowe to conduct an analysis of the Application, and to provide potential refuse collection rate changes for the JPA to consider effective January 1, 2018. This letter report documents results of our analysis, and is organized as follows:

1. Purpose of Analysis

2. Summary

3. Background of Analysis

4. Scope of Analysis

5. Rate Setting Adjustments

6. Results of Analysis.

1. Purpose of Analysis
The purpose of the 2018 Base Year Rate Analysis of South Tahoe Refuse Company (Analysis) is to assist the South Lake Tahoe Basin Waste Management Authority (JPA), and each respective JPA jurisdiction including the City of South Lake Tahoe, Douglas County, and El Dorado County (Specified Parties), with their establishing solid waste collection rates charged by South Tahoe Refuse Company Inc. (STR). The analysis was conducted in accordance with JPA's 2012 Solid Waste Rate Setting Policies and Procedures Manual (Manual).

The information in this Analysis is based on estimates, assumptions and other data developed by Crowe Horwath LLP ("Crowe") from information provided by STR, knowledge of and participation in other studies, data supplied by the JPA, and other sources deemed to be reliable.

In the course of preparing this Analysis, we have not conducted an audit, review, or compilation of any financial or supplemental data used in the accompanying Analysis. We have made certain projections of revenues and expenses which may vary from actual results because events and circumstances frequently do not occur as expected and such variances may be material. We have no responsibility to update this Analysis for events or circumstances occurring after the date above.

Our procedures and work product are intended for the benefit and use of the Specified Parties. This engagement was not planned or conducted in contemplation of reliance by any other party or with respect to any specific transaction and is not intended to benefit or influence any other party. Therefore, items of possible interest to a third party may not be specifically addressed or matters may exist that could be assessed differently by a third party.
489
Crowe Horwath.

Authority Staff
November 12, 2017

2. Summary

Page 2 ends

South Lake Tahoe City CouncilDecember 10, 2024

South Lake Tahoe City Council
December 10, 2024