10A Action 2009 0720 - Laserfiche WebLink

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ACI Rate July 20, 2009 • Modify quarterly reports to provide the City with more detailed and useful information; • Conduct annual independent accountant financial testing; • Make adjustments to the Revenue Neutrality fee so that it is consistent with the fees paid by the Davis Street Transfer Station; and • Use a Refuse Rate Index to calculate annual rate increases to more accurately reflect cost increases realized by the waste industry. In addition to completing the Review and Assessment, the City entered into negotiations with ACI to provide additional services and enhancements to the Agreement as part of the contract extension. Modifications to the Agreement include: • Extending the contract for up to five additional years contingent on the replacement of at least three collection vehicles per year with natural gas-powered vehicles; • Adjusting rates annually using a Refuse Rate Index (RRI) instead of the Consumer Price Index (CPI) and foregoing the rate comparison process at five year intervals; • Providing free solid waste, recyclables, and green waste collection services to the San Leandro Unified School District at no charge to the District; • Adjusting fees paid to the City annually by CPI; • Providing additional curbside collection services to residents; • Providing a 60% discount on debris box collection services to the City; and • Sharing revenues from the sale of recyclable materials by providing a credit to ratepayers in the form of annual adjustments to the rates. Lastly, the City contracted with R3 a second time to verify ACI's current financial condition and to assess the impact of the recent 10% rate increase and the proposed amendments on its financial condition. The results of this review indicate that although there is risk associated with trying to accurately project revenues from the sale of recyclable materials in the future, ACI will likely be able to make its bank covenants through the term of the contract.. Current City Council Policy N/A Previous City Council Action(s) Resolution No. 2000-8 approving a Franchise Agreement for Solid Waste, Recyclables and Green Waste Services between the City of San Leandro and Alameda County Industries, Inc. Resolution No. 2006-141 approving a Letter Amendment to the Agreement between the City of San Leandro and Alameda County Industries, Inc. for the purpose of providing additional curbside collection services to businesses and residents. Resolution No. 2009-052 approving a Letter Amendment to the Agreement between the City of San Leandro and Alameda County Industries, Inc. for the purpose of implementing a 10% rate increase as of July 1, 2009. City Council Committee Review and Action N/A