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HomeMy WebLinkAboutMINUTES - 02282006 - SD.1 yLA1 Contra TO: BOARD OF SUPERVISORS \ Costa FROM: Dennis M. Barry, AICP ��, _ �� County ,s rs• `uKT� Community Development Director co DATE: February 28, 2006 00 D• SUBJECT: RATE INCREASE FOR SOLID WASTE COLLECTION IN THE UNINCORPORATED AREAS SERVED BY CROCKETT GARBAGE SERVICE UNDER THE COUNTY FRANCHISE AGREEMENT - SPECIFIC REQUEST(S) OR RECOMMENDATION(S) & BACKGROUND AND JUSTIFICATION RECOMMENDATIONS 1. ACCEPT report from NewPoint Group dated January 31, 2006 regarding their review of the Base Year Rate Application submitted by Crockett Garbage Service. (EXHIBIT A). 2. APPROVE a solid waste collection rate increase of 6.74% effective March 8, 2006, for customers in the unincorporated areas served by Crockett Garbage Service under the County's Franchise Agreement. FISCAL IMPACT No impact to the County General Fund. The cost of the consultant contract is being paid using solid waste collection franchise fees. BACKGROUND/REASONS FOR RECOMMENDATIONS The County has a solid waste collection franchise agreement with Crockett Garbage Service (CGS), a subsidiary of Republic Services, Inc., for service to the following unincorporated areas: Crockett Port Costa Tormey The County's CGS Service Area includes portions of Supervisorial District II. CONTINUED ON ATTACHMENT: X YES SIGNATURE 1 RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD CO MITTEE :/APPROVE OTHER SIGNATURES : ACTION OF BOV ON ® APPROVED AS RECOMMENDED 0MER VOTE OF SUPERVISORS / I HEREBY CERTIFY THAT THIS IS A TRUE V UNANIMOUS (ABSENT AND CORRECT COPY OF AN ACTION TAKEN AYES: NOES; AND ENTERED ON THE MINUTES OF THE BOARD ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN. Contact: Deidra Dingman (925/335-1224) ATTESTED cc: Community Development Department (CDD) JOAN SWEETEN, CLERK OF THE Crockett Garbage Service BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR BY �� 1-C� , DEPUTY RATE INCREASE FOR CROCKETT GARBAGE SERVICE February 28, 2006 Page 2 BACKGROUND/REASONS FOR RECOMMENDATIONS (continued) NewPoint Group Review The County entered into an agreement with NewPoint Group to review the Base Year Rate Change Application submitted by Crockett Garbage Service. NewPoint Group conducted their review consistent with the applicable provisions of the rate setting manual approved by the County for use in other areas within the County served by Republic Services. The result of NewPoint Group's review is contained in their letter dated January 31, 2006 which is attached as EXHIBIT A. Base year rate changes are calculated based on increases in various costs outlined in the Base Year Rate Application. CGS submitted a Base Year Rate Change Application requesting a rate increase totaling 11% due to projected increases in tipping fees, direct labor costs, administrative costs, and trucking and equipment costs. These projections were later adjusted by NewPoint Group's findings and agreed to by CGS, resulting in the recommended 6.74% increase of the solid waste collection rate(which is 4.26% lower than the proposed rate increase). As a part of the NewPoint Group analysis, cost projections were evaluated comparatively to the Consumer Price index (CPI) for the 2004 — 2005 period. The franchise agreement provides for an increase in rates without County approval by an amount up to the most recent change in the CPI. CGS rates have remained unchanged for the past two years. If CGS had applied the CPI increase over that period, rates would have reflected a 3.41% increase. Therefore, the total proposed rate increase of 6.74% reflects cost increases that are 3.33% above the increase in the CPI for the two year period. There have only been three rate increases in the area served by CGS since the County entered into the franchise agreement in 1996. Rates were first adjusted in 2001 due to expansion of recycling services in the area to include green waste collection and rates were increased in 2002 and 2003 to reflect the change in the CPI (Table 1 in ATTACHMENT A details the history of CGS rate changes). Proposed Solid Waste Collection Rate Increase The below table summarizes the existing.and recommended residential solid waste collection rates. Container Size Existing CR 6.74% Increase of CR Recommended CR 20 gallon $ 19.13 $ 1.29 $ 20.42 32 gallon $ 22.69 $ 1.53 $ 24.22 45 gallon $ 29.99 $ 2.02 $ 32.01 64 gallon $ 39.80 $ 2.68 $ 42.48 95 gallon $ 48.35 $ 3.26 $ 51.61 Rate listed is for curbside service. Backyard service rates would increase from$23.31 per customer, per month,to $24.88 per customer per month,an increase of$1.57 per customer, per month,for a 32-gallon container. A majority of residents use the 32-gallon backyard service 2 Rate listed is for curbside service. Backyard service rates would increase from$30.62 per customer, per month, to$32.68 per customer per month,an increase of$2.06 per customer, per month,for a 45-gallon container. A majority of 45-gallon customers use backyard service. The recommended 6.74% increase would also apply to commercial customers served by CGS under the County's Franchise Agreement. ATTACHMENTS Exhibit A—Letter from NewPoint Group dated January 31, 2006 G:\Conservation\Bryn\Franchise\Franchise-BS\Crockett\BO-Crockett Base Year Rate Increase 2006.doc NewPoint. Group' Management Consultants: January 31, 2006 Ms. Deidra Dingman Solid Waste Program Manager Community Development Department Contra Costa County -- 65-1 Pine-Street . 4"' Floor, North Wing Martinez, California 94553 Subject: Rate Review of Crockett Area Served by Crockett Garbage Services,Inc. This report represents NewPoint Group, Inc.'s review of a rate application submitted by Crockett Garbage Service, Inc. (CGS), a subsidiary of Republic Services, Inc., for 2005. Republic Services purchased CGS in May, 2001 and since then has provided residential and commercial refuse collection services to the unincorporated Contra Costa County(County) areas of Crockett, Port Costa, and Tormey (together referred to as Crockett areas). NewPoint Group assisted the County with a rate analysis for Crockett areas in 2001. Additionally, since 1997 we have provided solid waste management consulting services to the County for areas served by Garaventa Enterprises, Allied Waste, dba Pleasant Hill Bayshore Disposal, and Republic Services. As a result, we are very familiar with the solid waste rate setting environment in the County. NewPoint Group's related rate setting qualifications are summarized in Attachment A. The remainder of this letter report is organized as follows: A. Project Background B. Review Findings C. Recommended Rate Change. A. Project Background The franchise agreement between the County and CGS specifies that CGS is allowed to submit an application for a rate change in a format required by the County. CGS also • 2555 Third'Street,Suite 215.sacromento.California 95818 0 Phone::(91'6)442-0508 • Fax:(916)442-0714 NewPoint'Groupe %janogem.•ent Consu?ants Ms. Deidra Dingman Page 2 January 31, 2006 is allowed to increase rates, without County approval,by an amount up to the most recent change in the Consumer Price Index for the San Francisco Bay Area. CGS submitted a rate change application on September 29, 2005 (see Attachment B). The request is for a 10.13 percent rate increase. CGS cited that the increase is necessary to cover increases in direct labor costs, tipping fees, general and administrative costs, and trucking and equipment costs. The format and content of the rate application is consistent with the County-approved rate application used for other County areas served by Republic Services, Inc. ------. ......... .. —..._._. ..---- — _.._._... _.... On October 27, 2005, CGS contacted the County, indicating that additional new transfer costs will add $1.91 per ton to the tipping fee, increasing the tipping fee from $63.09 per ton to $65.00 per ton. This change increased CGS's requested rate increase from 10.13 percent to 11.00 percent. CGS had previously submitted to the County calendar year ended December 31, 2003 audited financial statements prepared by Armanino McKenna. Audited financial statements were unavailable for 2004, so we relied on un-audited, internally prepared, calendar year ended December 31, 2004 financial statements for this review. Residential rates, and rate changes, since 1996 are shown in Table 1 below: Table 1 Contra Costa County Historical Rates of Crockett Service Area Year Service 1996 2001 2002 2003 to 2005 20-gallon (curbside) $16.00 $18.34 $18.73 $19.13 32-gallon2 $20.00 $21.74 $22.20 $22.69 45-gallon $27.00 $28.74 $29.34 $29.99 64-gallon $39.80 95-gallon $48.35 Change in rate $1.74 - $2.34 2.1% 2.2% Explanation for change Service change CPI CPI '-For curbside service. Backyard service is currently$23.31 per customer,per month,for a 32-gallon container. A majority of 32-gallon customers use backyard service. 3 For curbside service. Backyard service is currently$30.62 per customer,per month,for a 45-gallon container. A majority of 45-gallon customers use backyard service. NewPO:int Group`' Monogement..Eansutgnts Ms. Deidra Dingman Page 3 January 31, 2006 Over the nine years between 1996 and 2005,the 32-gallon residential rate has increased $2.69 per month,or by 13.5 percent. In 2001,the following service changes were made to CGS served areas: o Addition of monthly collection of greenwaste using 64-gallon cart o Change in frequency of collection of commingled recyclables from weekly to bi-weekly, using a 64-gallon cart o Change to allow 20 percent of customers to be exempt from greenwaste service o Requirement that one container for greenwaste collection be provided at multiple unit dwellings(unless otherwise exempted). NewPoint Group was required to complete the following six(6)tasks for this rate review: 1. Verify the completeness of CGS's rate change application 2. Review the rate change application and prepare a response 3. Survey rates in similar service areas 4. Prepare a draft report 5. Prepare a final report 6. Participate in one Board of Supervisor meeting. B. Review Findings Table 2,on the next page, summarizes six adjustments resulting from our review of CGS's 2005 rate application. These adjustments reduce the revenue requirement by $29,579. With these adjustments, CGS would operate at a shortfall of$47,759. Many Crockett costs are costs that have been allocated from Republic Services' total costs of serving the Berkeley(commercial), Crockett, Piedmont, and Rodeo areas. We reviewed Republic Services' method for these costs allocations, which included factors such as routes, headcount, and trucks. We initially made some minor cost adjustments to CGS general and administrative costs as we believed Republic Services' slightly over-allocated selected general and administrative costs to the Crockett area and slightly under-allocated selected general and administrative costs to the Rodeo area. After further discussions with CGS management,they indicated that the Crockett area requires significantly more management and customer service time than the Rodeo service area. We were satisfied with this explanation, but recommend that the County continue to monitor these allocation methods/bases in future rate reviews. NewPoint Groin " MonagemEfit consGltants Ms. Deidra Dingman Page 4 January 31, 2006 One of the larger adjustments($12,331) represented the costs of providing"services to the County." We requested supporting documentation and rationale for these costs from CGS. CGS indicated that these costs were to provide service to County-owned facilities. As these costs already are reflected in the overall costs of providing service to Crockett,we disallowed these costs 4 Attachment C includes the adjusted rate application. Table 2 Contra Costa County Adjustments to CGS Rate Application Net Adjustment to Revenue Description of Adjustment Requirement Rationale 1. Reduction in Direct Labor -$5,768 Use of projections for wage rates and benefits costs based on union labor agreements. 2. Adjustment of Tipping Fee -$3,696 This treatment in consistent with other County (with Profit) from $50 per ton regulated areas. to $45 per ton 3. Reduction in Services -$12,331 Costs of these services are already included in Provided to County other operating costs. 4. Reduction in Trucking and -$1,317 Projection assumes: (1) fuel cost increases Equipment Costs consistent with change in published year 2004 to year 2005 price per gallon, (2)no change to ongoing equipment rental costs,and (3)the CPI applied to all other equipment costs. 5. Increase in Residential -$5,250 Reflects a one percent increase in projected Revenue Projection residential revenue. 6. Decrease in Franchise Fee -$1,217 As franchise fees are calculated based on 5 Payments to County percent of gross revenues, this reduction reflects the impact of the adjustments identified in #1 through#5. Total -$29,579 4 For example,a driver serving a commercial route will pickup material from County-owned facilities as well as other commercial establishments,so there are no additional costs to account for in serving just the County facilities. NewMint Group` Managprrient.Conso!tants:. Ms. Deidra Dingman Page 5 January 31, 2006 C. Recommended Rate Change With the adjustments identified in Section B,NewPoint Group recommends that the County increase Crockett area residential and commercial rates by 6.74 percent. This is a reduction of 4.26 percent from the company's request of 11.0 percent. Recommended residential rates are summarized in Table 3. In accordance with the franchise agreement, CGS is allowed to increase rates without County approval by an amount up to the most recent change in the Consumer Price Index for the San Francisco Bay Area. For the prior two-year period, rates have remained unchanged. Had CGS increased rates by the applicable CPI (August to August), rates would have increased by 3.41 percent for years 2004 and 2005.5 The recommended increase is 3.33 percent above the CPI for _ -- .........._. _...._...._._... ... this prior two-year period. Table 3 Contra Costa County Crockett Service Area Recommended Year 2006 Rates Service Current Increase in Proposed Rate Rate Rate 20-gallon $19.13 $1.29 $20.42 32-gallon $22.69 $1.53 $24.22 45-gallon $29.99 $2.02 $32.01 64-gallon $39.80 $2.68 $42.48 95-gallon $48.35 $3.26 $51.61 Change in rate 6.74% We surveyed residential rates of 21 neighboring jurisdictions. Results of this comparative rate survey are provided in Attachment D. Proposed 32-gallon residential rates are 11 percent above the average 32-gallon residential rate whereas proposed 96-gallon residential rates are two percent above the average 96-gallon rate. An explanation for why Crockett area rates are above s Based on the change in the August to August San Francisco-Oakland-San Jose CPI. For year 2004,the percent change was 1.22%and for year 2005,the percent change was 2.16%. On a compounded basis this represents a 3.41 percent increase(i.e.,(1+.0122)*(]+.0216)= 1.0341). 6 For curbside service. Backyard service rates would increase from$23.31 per customer,per month,to$24.88 per customer per month,an increase of$1.57 per customer,per month,for a 32-gallon container. A majority of 32- gallon customers use backyard service. 7 For curbside service. Backyard service rates would increase from$30.62 per customer,per month,to$32.68 per customer per month,an increase of$2.06 per customer,per month,for a 45-gallon container. A majority of 45- gallon customers use backyard service. NOWPOI t Gr wh Management Consutrants Ms. Deidra Dingman Page 6 January 31, 2006 the average is that the Crockett area is harder-to-serve than many of these neighboring jurisdictions. Should you have any questions regarding this letter report, please do not hesitate to contact Erik Nylund in Oakland at(510) 338-0104. Very truly yours, New. Point Grp upi Inc, Jim Gibson, Director Newts t`Group� Management.C�niutants_ Ms. Deidra Dingman Page 7 January 31, 2.006 Attachment A NewPoint Group Overview of Rate Setting Clients A. Contra Costa County 1. Areas Served By Republic Industries Inc. dba Crockett Garbage Service(2001 to present) 2. West County Areas Served By Republic Industries Inc.dba Crockett Garbage Service ---....... ................(.1.996..to_present) . ...__._ . 3. Central/East County Areas Served By Allied Waste Services dba Pleasant Hill Bayshore Disposal (1997 to present) 4. East County Areas Served By Garaventa Enterprises(1997 to present) 5. City of Concord (1993 to present) 6. City of Martinez(1999 to present) B. Other Areas Outside of Contra Costa County 1. City of Fremont 2. City of Newark 3. City of Union City 4. City of Vacaville 5. City of Vallejo 6. Town of San Anselmo 7. Durham Road Landfill Trust Authority 8. Douglas County 9. El Dorado County NewPoint'Group' Management.C-onsu?tants Ms. Deidra Dingman Page 8 January 31, 2006 Attachment B Rate Application Submitted by Crockett Garbage Service Crockett Sanitary Services ---.I. - -... ._._... . ---........_...... ........................ To: Omm Ed Skelly CC: I now .September 28,2005 Rm . Crockett Rate Application General: This.memorandum discusses Crockett Sanitary Services,Inc.(the"Company')("CSS")year to year income statement fluctuations and significant changes in the Company's accounting policies and procedures. "In general,the early years'numbers reported in the rate application are not as reliable as current numbers since the Company's system was not setup to track amounts at as precise a level as now. First Year(2001): Republic Services,. Inc. (the"Parent") ("RSI") purchased the Company.effective May 22, 2001. The income statement shown in year one of the rate application only.corresponds to the stub period in 2001 that the Company perfof red disposal services,approximatelyseven months. Therefore, income statement numbers shown in year two of the rate application, 2002,will be approximately 70%greater than 2001. Second Year(2002)to Third Year(2003): There are three expense areas with significant fluctuations:Direct Labor increased-$50,000 G&A costs increased-$40,000, and Trucking and Equipment increased-$60,000. The direct labor increase was due to increases in collection helper wages and truck shop labor. The:Company implemented the Kronos payroll system during 2003,which enabled them to more adequately track where their drivers and helpers worked during the day. This.enabled the Company to correctly record wages to CSS for times during the day when the helpers crossed from one jurisdiction to another. The Kronos system also now allowed the Company's truck shop workers to identify time spent working on individual trucks. The Company's trucks are older,and therefore, more time is spent repairing these trucks,which was reflected by the increased costs allocated to CSS. The increase in G&A costs was due to the Company allocating manager bonus to the Company in 2003 and the change.in the method to allocate office expenses. The Company had not been allocated manager bonus costs in the previous year. Additionally,the Company began allocating office expenses like rent, utilities, and etc by routes because the Company believes this is a more accurate method to allocate such costs. The change in methodology caused an increase in office expense costs allocated to the Company. The increase in tuck k costs was'due to the Company performing a truck inventory and updating the number of trucks the Company was 1 NeWIVI Group manogprhant Cbmu"ants Ms. Deidra Dingman Page 9 January 31, 2006 Attachment B Rate Application (continued) i being charged rent The inventory resulted in the Company being changed rent for two more trucks and many more.containers. There are also fluctuations between residential revenues and commercial and industrial revenues from 2002.to 2003. These fluctuations arise due to the.Company s change in a=unting for revenue from apartment complexes and similar customers. During 2002,the .Company:coded these revenues.as commercial revenue. In 2003, the Company began coding these revenues to residential revenue, which caused the. residential..revenue to increase and commercial and industrial revenue to decrease. Thlid Year(2003)to Fourth Year-(2004): i There.is one expense area with a significant fluctuation from 2003 to 2004: Tipping Fees increased $30,000. The.increase in tipping fees is due primarily to an increase in revenue i. as well as the standard.yearly 2%increase in fees per ton. i i i •Page 2 NewPoint Group''' m6nagement.Consultants Ms. Deidra Dingman Page 10 January 31, 2006 Attachment B Rate Application (continued) Crockett Garbage Service APPLICAVIO11N for RATE ADJUSTMENT September 2005 NeWko# Group` Managemerit Consultants Ms. Deidra Dingman Page 11 January 31, 2006 Attachment B Rate Application (continued) Contra Coate County Base Year Rate Change Application Financial information Act" Acini M . Hlstorioal Yeats Current Year . . .. .. Year? .Year Year . .Year4 .,f.iu.'eafS k:J Enter Actual Year In this Row. 2001 2002 1 2003 2004 'rcr,•._,.,N,w 1. Direct Labor $ 43,0110 S . .738 54b i 189 000 S 208,902: l-n!:%P2tb838'.. . 2 Tipping Fees(Pro9tMowed) 86,161 136.337 128.954 ...13836 ate,; 3. CorPorste and Local General and Administrative Costs. 26,454 62379 I 100.280 '93.190' =+>,+_zzm' 1 4. .Depreciation and Other Operating Costs ...:.. :. . :.: = 9-8 9 89 ..8 000: 5. Services Provided to T,193 11,618 12072 12.331 ','x-'xis%ra82-3'!;. :8. TotelMmableCosts(Wrest+2+3+4+5) S 358,835 S 436.286 S 470,560 8 7. :Operating Ratio .. .90.0% � 90.0% . 90.0% 8. AlmedeOpen*VProMf(Llns6*OR)-Ltre6}l. S 78092 S 39878 :S 48.476_1 S 52284 9. County Administrative Fee .. - 10. Trucking and EgldpmeM 34,000 67,846 187,012 153,733 -?:-k 11, 7 Fees PeasThroth 17.402 1 24;592 852 26 38;130 .25.,•- F1.09.. 12. 7oml Pass Through Code(without Franchise Fees)(lines 9+10+11) 61.4021 112,4371 193 664 1 189.862 13. Total Allowable Costa(Una 6)plus Allowable Oparafng Profit(Line 8)piu@".. .. Total Pass w Ttagh Costs(without Franchise Fees.(Lite'12} :S '232.322 S 511.2011 S 678,426 I S :712 7177 I,.+Fi;•a7:59�85.. 74. Resk7enfia{Revarsna 263,163 406,494 486,116 '525,000 4Yi c;'S21: Y5. Lase Allowance for l)ndWo Residential AcoaWs.: :,.:. .. (40,0110) (5.8141 4,454 (4862 18.. Total Residential Revenue(without Rale Change in Base Yaaij S 213.163 S 400 880. S 49D li 1 S 520.036 • ".-= Ma 17. Corrm*rciW and Light Industrial Revenue 185,000 230282 175.000 1831000 la Less Alowence for Linra6aedhb Commadal and L)ght Industrial Aemurls (9. Total ComerclatfUgfd Amblsi el Revenue tMMaa Rate Change. Sase Year) $ 7 .000 155 S 230.282 $ 176 000''S: .183.00' ms 20. Recycied Material SalesS . . 21. Tocol Revenue(Lanes 16+19+2D) S 378,183 630 9fi2 $ 665 S70 S .703,038 22. Net Shortfall(Surplus)without Franddse Fees(Lire 13=lhw 21):.. S (145,841) S (119.761) $ 12:856 S 9,669: 23. Resi lertaltCornmarde9L'gid Industrial Franchise Fees(we calculation below) H S 12227 15 26.9051$ 35.707 15 37.511 !am37-M 17445 24. Net Shortlel(Surplus)with Franchise Fees(Lines 22+23) S (133,613) S (82,856) S 48.683 5 47,180 : 25. Total ResidentiallOommariaY 1 indusMel Revenue Prior to Rete Change(Lines 16+19) S 830.9652 S 665.570 S 703,038 26. Percent Change In Existing Raddenlel/Commerciallugla induWW Rste3(Line 24+Line 25) -14.7296 7.30% 61%yrvnT::1(O.�t3 Franchise fees are set by the County at 5 percent of the revenue requirement 27. Total Allowable Costs(Lire 6) Solve for two equations with one unknown,ami Ideniff franchise fees as X 2& Allowable Operating Profits(Lan 8) Equation 1)Revenue Requirement x 0.05•X 29. Total Pass Throuah Costa(with Franchise Fees)(Lines 12.23 Equation 2) Revenue Requirement Q Lim 13+X or$4,427,391*.X 30. 2006 Revenue RequhemaH(Unna 27+28+29) Substitute equetion 2)into equation 1)and solve for X => $4,477,391+n x 0.05 s X.or X-S233,021 " During One year ended 12131104.Crockett Income.and expense amounts were combined In one general ledger with four other Republic divisions. Therefore,the 2004 Crockett amourds above were derived directly or using varying aloaalion factors. Year: 2004 Page f of 6 NewPc7nt`Group' Management.Consu!rants:..: Ms. Deidra Dingman Page 12 January 31, 2006 Attachment B Rate Application (continued) Contra Costa County Base Year Rate Change Application. Cost Summary for Year 2003. Allocates! Aliocaf on Descriptlon of.Cost 2002 2003 Balances Labor-Regular $ 113,01101: 157,000. WA Labor-Overtime WA Benefits 19, 25,000 N/A Payroll Taxes 5; 7.000 NIA 31. Total Direct Labor 1 8; 89000 WA. 32. Total Tippblg Fees(Profd AtivNed) . 136,337 128,9641A Bank fees 2,743 fi 000: WA 5=5 Psy.Corporate - 1.7.000 . ..':'WA Consulting end Professional Fees 5,303 7,000 WA Dues and Subscriptions 5o 1,000 WA instuartce 20,853 21,000 WA i Laundry and Uniforms.. 51 3,000 WA Management FeeafCotpurste�Overttead . 16,400 16,268 NA and Other 1,443 2 N/A Office Expense 12;481: 24,000 NIA Outsource Billing. 724 1,000 WA Postage 2,002 4,000: WA Sales and.Marketing Mae. 936 - NIA Telephone 333 N/A 33. Total Corporate and Local General and Adminlel'ative Costs 62-3701$ 100,280 Deprae error-8uidirtga $ $ WA Depreciation-Me Furniture and Equipment i. :N/A Depreciation-Veit des WA Dep Watton-.Conlabters WA Depreciation-Equipment NIA Other Operating Costs 9,809; 6,000 : NIA 34. Total Depreciation and Other Operahng Costs 8 35. Total Services Provided to County t 1 18 AS 2 N/A 36. Total Allowable Costs(Lines 3i+32+33+34+36) . S358,M 4$ W,286 37. Total Cotsrty Administration Fee 1 ' Equipment Rental S 66,024 S 135,012 N/A Gas and 011 7 741 9,000: WA Parts 2,053 t0,000 WA Repair and Maintenance 600 WA Tires 1,005 5,000; WA OHM 8,422 8,000 I N/A 38. Total Trucking and Equipment..: 38. Total Tipping Fees(Pass Through). 24,592 $ 6 652. A 40. Total Realdential/CDmmerclatUghl Industrial Franchise Fees S 28,905 S a5,707-11 A11 41. Total Pass Through Costs(Lines 37+38+39+40) $ $ 9,3 D 42- Total Costs(Lines 38+41) $ 498 30 665,666.11 Year. 2004 Page 2 of 6 NeWO t Group. MtS�agsmerit G�nsultQnts Ms. Deidra Dingman Page 13 January 31, 2006 Attachment B Rate Application (continued) cmltra:CoMa County Base Year Rate Change Application Reverwe Summary .. .. Atlual:.. Eslunei®d Historical Years Cisasnt.Year -":3teeE'>.� Year 1 Year 2 Year.3 Year' i';YeDyj4!grid Enter Actual Year In 02 this Row .:2001 20 2003 2004 :.,•.:.;2d05;c:;> _.... . ..... .._. ...--------. shio*Faddy Reaidential Sarvke-..-..._. ------ ... -------- ---._.. 43.. Sl, la:Family Residential Revenue(Base Year From Page 4 of 6) S - is i MuNiurdt Residential Service 44.� NuxnbOt of Ac=unts 37 45. Willunil Residential Revenues $ S - S 67.612 4Q Residenial Revenue(w/o Allovence for Uncolledible,Accounts)(Linea 43+45]: S .. S - S 4M.116 Is .q. Mlo w as for uncolieclible Readdentler Accounts ... $ S S .4 411. .Total Resdential Revsrwa(Line 46-Llns 47) ...5...' - 9 $ 490.570 13 -•a�•,;_'.�`..r'""' Commercial-and Light industrial Can Service � 49. Number of Accounts 50, ComnerUei and Light Irafustrial Can Revenues S 5 5 28.000 S .•'d ;=3.i'vwr+�:'''.' i Comrnerclal and Light iadustrial Bin Service 51. Number of Accounts 52. Commercial and Light Industrial Bin Revenues S S S S 3:f•:tom •:'..''' Commercial and Light industrial Drop Box Service 53. Number of Accounts -_ i 54. Commercial end Light industrial Drop Box Revenues S S S 149.000 $ 55. Commercial and Light Industrl°i Revenue(w/o Allowance for Unoollectible Accounts)(Lines 50+62+54) S 3 - S 175,0001$ 56. Allowance for Uncollectible Commercial and Light Industrial Accounts S - S I S 67. Total CornmerChd and Light Industrial Revenue(Line 55-Line 80) S - •$ S 175,0W S I W. Recycled Material Saltie S - 15 - I S is- 69. Srip. Total Revarwe(Unae 48+57.58) ... S. $ - IS 666,570 jS - :'S-%=c•...:�_r-`.-:;':_ i i i i Year: 2004 P°ge'el s NewPoint`Group`' Ntanagement G�,nsu':.iants Ms. Deidra Dingman Page 14 January 31, 2006 Attachment B Rate Application (continued) conaa:costa County Base Year Rate Change Application Single Family Residential Summary lug= M Single Family Reslderrtla!revenue(witfrotn Rate Changs M Base Year) . .. Current •.:.,..1.,a: --- --- ---- Reeklentlal:BackYard RateWonlh— 32gellancontainer $ 23.31 1,121 S a Q1,.31' 45 gallon corMw .30.62 65 gallon container 39.80 .75. 95 gal m container 49.35 19 . 20gallon UnWAn 19.13 192 �a.:=' ..3+%x131373. Current• P _:r.:.�;a;{"• RealdendabOurbslds RatelMonth Pt:ooure9 '`r�: I:e'Fs== .$ .. 22.68 28 €}''''��:•�.s.;.�; : . 45gokncaltekier :29.99 45 4 r;; r1• .. 60. Total Bass Year Single Family Residential .... �'+=rv�:F•�:x;•;. ,,��' I i a/ Equal to the current rate per month multiplied by 12 mUldplied by the projected number of accounts. Year: 2004 Page 4 of 6 NbwvPdnt,'Group Mana&rnent Consutrants Ms. Deidra Dingman Page 15 January 31, 2006 Attachment B Rate Application (continued) Conga Costa County(Crockett) Base Year Rate Change.Appfication Operating information 'HIllOtCei ver-�'- ,�'t;` Current ear"', 'Base Yeer Historical : ? Historical Audited Estimated -Rgaiit'' ..Projected dnformetionr`r' �^e> Infonnatlwt.rs ,■ Infam[aGon;._xtia` Infonnasion (1en e::•' Information' Year 1 s'. "5:10: ..1 Year 2 3r ' ti8.1 Year 3 53lia Year '?YiF 4Da Yea[5 Enter Actual Year 2001 202 2003 20042006 Accounts S!. Residential 519 #DIV101 1280 #DiV/01 1;280 9- fib 1,303 82. Commercial 595 #DIV/OI 366: #DIVl01 9. =; C�Ai° 7 I!T/D' 63. Light Industrial 8 . NIA . , 10 NIA:.. 1201-': r�r 38 64. Total Accounts 1.122 #DIV/Dl 1 1.858 #DIVJ01 1 409 :•;,10! `..1+'934S-kw 7fdA a=3 -fix Waste Tonnage 65. Residential 681 !011 1,364 #DIV/01 1,337 :`:` 7 f( 1,271 ;` 17tlpt 66. Commercial 5961 #DIV/Of 367 #DIV/01 6 i�`1H91#�IOQ� 0 ► j 67. Light Industrial 506 N/A 902 : N/A 937 ;tt]T1s: 11556 .i r„..'�H-F;w'...sra:3.dP:+�':�:�9"':�k�•<{.:.::.:n - G�:'_•,•S.'.'.:t?2'.'+yf`':=.�',=%f't _ �?ka rX,1.`�?ii.'j�;'F':: 68. Total Tons =.r�;^4'I :,r;;d41d1t:.::���2"63�Y. �•.�1kilM� ,.� .. 'ti•�fll _ :... # '�°.:.'.::::::`-�' Recyclable Tonnage 69, Residential 39 s ' 178 r. f. t 168 r 1131Y1(!k1 197 41; Df71n� 70. Commercial 0 ;iED10;: 0ti` lY7L1€1p 0 "::9R134Y1f1J 0 71. Light Industrial 7 nl _ 1 P; u 0 72. Total tons .:s F County Services 73. County Bins 2,115 8 ' €tF¢11?1((1 3,847 ,!;: trio.. 3,506 f31 dit3t 3,914 1311Y101;:. 74. County Drop Boxes 4d1IJ01 8 9 =. DIi/Q.(. 15 C':= D1V161 2001 represents only 7 months of year as the Company was acquired May 22,2001.Also,co tmerclai apartment complexes switch to residential from 2002 to 2003 for reortin Dur oses. ,je in Covinicrual Rales 103.3275. 1Yd.Bin-1X erweek 99.00 103.32 $$ 101.10 $ $ ,'. :•. 76. 2 Yd.Bin-1 X per week $ 133.00 ^ 138.79N $ 138.79 ;IiDIVlAt$ 77'. 20 Yd.Box- i N/A ^'1r=`t+11R`- `. NIA 'Niii:%; NIA %s i 'N/1*::`= NIA ;>:::'!N►Aa= '.':.i N/A perpckup Year. 2004 Page 6 of a New R' Management..Consui`an t; Ms. Deidra Dingman Page 16 January 31, 2006 Attachment B Rate Application (continued) Contra Coate County Base Year Rate Change Application i Unincorporated Area: AN Areas 7d Rate Change Requested Abbavlated Ir4 eased .. New . Rate Schedule Current Rate .Rate. AdjuuMtents(a) Rate Residential.8aak Yard . .. -- . 320100 M*kbr $ .23.3111$ .25.67 S :0.01 $ 25,88. 45gelkocadetner .. 30.62 1 33.72 (0.01) 33.71 650100coet mr 38.80 43.83 0.01 43.154 960st0nco�tner .. 48.35 .53.25 0.01 53.28 . 20 gallon Wi-Can ,. 19.13 :21,07 21.07 ReaWervdal-Curbsds . 32 p*n condlne $ 22.69 S 24.99, S 0.02 $ 25.01 I 45 gst,n corner 28.99 33.03' 0.02 93,05 (a)Caladsted rates are rounded up to the nearest$0.05. . 79. Ahilliunt Residartiat Rata increases,at 10A3 vAl be applied to an rates In earn structure with each rete rounded up or down to . .. the nearest$0.05.. . i TO the best of my knowletlge,the don and Information In INs application is ontplefe,soc rate,and consistent with the hstntdlons provided by Contra Costa County. . Name: Ed Skelly Title:Area Controller Stgnature: Date: I I I Year. 2004 rage 6ora NewPalnt Group" McnagEmertt.tielisi+!ii�iZis, Ms. Deidra Dingman Page 17 January 31, 2006 Attachment C Adjusted Rate Application Contra Costa County-Crockett Area Base Year Rate Change Application Financial Information Estimated Projected Adjusted Proj. Current Year Base Year Adjustments Base Year Year Year, Years Enter Actual Year in this Row 2004 2005 2005 1. Direct Labor $ 206,902 $ 221,833 $ 5,768 $ 216,065 2. Tipping Fees(Profit Allowed) 158,136 158,606 15,168 143,438 3. Corporate and Local General and Administrative Costs 93,190 91,079 0 91,079 4. Depreciation and Other Operating Costs 0 0 0 0 5. Services Provided to County 12,331 12,331 12,331 - 6. Total Allowable Costs(Lines 1+2+3+4) $ 470,559 $ 483,849 $ 33,266 $ 450.582 7. Operating Ratio 98.9% 90.0% 90.0% 8. Operating Profits[Allowable Profits in Base Year:(Line 5+0.9)-Line 5)] $ 5,105 $53,761 $3,696 $50,085 Section 111--Pass Through Costs without Franchise Fees 9. CountyAdministrive Fee - - - 10. Trucking and Equipment 153,733 158,244 1,317 156,927 11. Tipping Fees(Pass Through) 36,130 45,503 (15,168) 60,671 12. Total Pass Through Costs(without Franchise Fees)(Lines 9+10+11) 1 189,863 203,747 (13,851) 217,598 13. Total Allowable Costs(Line 5)plus Operating Profits(Line 7)plus Total Pass Through Costs(without Franchise Fees)(Line 10) $ 665,527 $ 741.357 $ 23,112 $ 718,245 Section V--Revenues without Rate Change in Base Year 14. Residential Revenues 1$ 525,000 $ (5,250)1$ 530,250 15. Less Allowance for Uncollectible Residential Accounts 4,962 4,962 16. Total Residential Revenues(without Rate Change in Base Year) Is 520.038 $ 520,038 $ (5,250)1$ 525,288 17. Commercial and Light Industrial Revenues $ 183,000 $ - $ 183,000 18. Less Allowance for Uncollectible Commercial and Light Industrial Accounts - - 19. Total Comm ercial/Light Industrial Revenues(without Rate Change in Base Year) $ 183,000 $ 183,000 $ - $ 183,000 20 Recycled Material Sales - - 21. Total Revenues(Lines 14+17+18) $ 703,038 1$ 703,038 1$ (5,250) $ 708,288 22. Net Shortfall(Surplus)without Franchise Fees(Line 11-Line 19) 23. Residential/Commercial/Light Industrial Franchise Fees(see calculation below)11S 37,511 11$ 39,0191$ 1,2171$ 37,802 24. Net Shortfall(Surplus)with Franchise Fees(Lines 20+21) $ 77,338 $ 29.579 $ 47,759 25. Total Residential/Commerdal/Light Industrial Revenues Priorto Rate Change(Lines 14+17) 11$ 703,038 1$ (5,250)1$ 708,288 26. Percent Change in Ewsting Residential/Commercial/Light Industrial Rates(Line 22+Line 23) 11 1 1.00% 6.74 Year: 2005 roups NewPoint`G Nignac�Ement Cansu`tants Ms. Deidra Dingman Page 18 January 31, 2006 Attachment D Comparative Rate Survey Rate No. Jurisdiction 20-gallon 32-gallon 64-gallon 96-gallon 1 Danville 14.17 16.35 32.70 49.05 2 Lafayette 14.90 17.18 34.36 51.54 3 Moraga 15.88 18.33 36.66 54.99 4 Orinda 17.18 19.82 39.64 59.46 ---..--._......_..--.--...._. ..... . ......................---5- Uninc.County..(CCCSWA)- 14.17 ---16.35------- 32.70 49.05 6 Walnut Creek 11.16 13.37 26.74 40.11 7 Uninc.County(West) 22.94 27.44 52.61 78.37 8 El Cerrito 16.27 25.22 50.43 n/a 9 Hercules 21.90 25.80 45.51 65.83 10 Pinole 21.50 25.40 45.16 65.54 11 Richmond 21.35 25.81 49.26 73.38 12 San Pablo 20.67 25.14 47.91 71.36 13 Kensington ** 21.10 28.65 70.45 n/a 14 Berkeley*** 12.95 20.69 41.38 62.06 15 Rodeo 14.42 15.47 18.87 25.95 16 Concord* 15.95 23.05 n/a 26.05 17 Clayton 19.28 20.41 29.65 32.31 18 Pleasant Hill 23.05 25.00 25.46 25.99 19 Antioch 21.59 22.61 28.34 33.07 20 Benecia n/a 21.43 25.03 34.53 21 IMartinez 17.75 25.44 28.38 59.60 Average 17.91 21.86 38.06 50.43 Crockett Proposed 20.42 24.22 42.48 51.61 %Difference 14% 11% 12% 2% * 32-gallon rate is ibr 40-gallon service. 1n process ofyear 2006 rate review. **45-gallon rate is high to encourage recycling and use of smaller can size. ***Represents average oftwo rates in two districts.