Resolution 2008-24
RESOLUTION NO. 2008-24
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
GILROY SETTING MAXIMUM CHARGES FOR THE
COLLECTION OF GARBAGE, RUBBISH, REFUSE AND
RECYCLABLE MATERIALS
WHEREAS, Chapter 12 of the Gilroy City Code provides that the City of Gilroy ("City")
may contract for the collection, removal and transportation of garbage, rubbish, refuse and
recyclable materials in the City; and
WHEREAS, the City and South Valley Disposal & Recycling, Inc., are currently parties
to an Agreement Between the City of Gilroy and South Valley Disposal & Recycling, Inc.
(SVDR), dated September 2, 1997, ("Franchise Agreement"), and as amended on July 6, 1999,
and June 19, 2000, by which the City granted to SVDR the franchise to collect, transport and
dispose of garbage, rubbish, refuse and recyclable materials produced within the City limits for
the benefit and in the interest of the health, safety and welfare of its citizens; and
WHEREAS, the Franchise Agreement provides that after the third year of the Franchise
Agreement, the rates and charges set forth in the Agreement shall be subject to adjustments
which correspond to increases or decreases in price indexes in accordance with the terms and
conditions set forth in Exhibit "J" of the Franchise Agreement; and
WHEREAS, the Franchise Agreement provides that after the third year of the Franchise
Agreement, the rates and charges set forth in the Agreement shall be subject to adjustments
which correspond to increases or decreases in price indexes in accordance with the terms and
conditions set forth in Exhibit "]" of the Franchise Agreement; and
Resolution No. 2008-24
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060508-04706093
WHEREAS, the documentation for this rate adjustment is set forth in the City Staff
report dated May 19,2008, and the letter from SVDR dated February 27, 2008, attached hereto
as Exhibit "A" and incorporated by this reference.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Gilroy
hereby adopts the maximum charges and rates for collection of garbage, rubbish, refuse and
recyclable materials as adjusted in accordance with the terms and conditions set forth in Exhibit
"J" of the Franchise Agreement, such charges and rates are set forth in Exhibit "B" attached
hereto and incorporated herein by this reference, to become effective on July 1, 2008.
PASSED AND ADOPTED this 16th day of June 2008, by the following vote:
AYES: COUNCILMEMBERS:
ARELLANO, BRACCO, DILLON,
GARTMAN, TUCKER, WOODWARD,
and PINHEIRO
NOES: COUNCILMEMBERS:
NONE
ABSENT: COUNCILMEMBERS:
NONE
APPROVED:
~
Resolution No. 2008-24
\JH\763466.1
060508-04706093
a
February 27,2008
City of Gilroy
Anna J atczak
Interim City Administrator
7351 Rosanna Street
Gilroy, CA 95020
Re: Julv 2008 Rate Adjustment
Dear Ms Jatczak:
As outlined in Exhibit "J" section A thru E of the September 7, 1997 franchise agreement, we
submit our request for a 7.27% adjustment to the collection rates effective July 1, 2008,
including a 5.78% CPI and Y2 of the 2.97% increase needed for the implementation of single
stream recylcing. Attached are the following exhibits:
Exhibit 1 - CPI Calculation
CPI calculation using the formula described in Exhibit "J" of the franchise agreement for the
Consumer Price Index and the Motor Fuel Index.
Additionally on this is Y2 of the 2.97% rate increase for the implementation of single stream
recycling that began January 14,2008.
Exhibit 2A - CPI Documentation
A print out from the U.S. Department of Labor - Bureau of Labor Statistics displaying the
required values of the CPI calculation.
Exhibit 2B - Motor Fuel Index Documentation
A print out from the U.S. Department of Labor - Bureau of Labor Statistics displaying the
required values of the MFI calculation.
Exhibit 3 - Rate Schedule
This table applies the combined CPI factor to the current rates and calculates the adjusted rates
for July 1,2008.
Should you have any questions or need additional information, please call me at (408) 847-5700.
si~c:~e8( /
/ " .----
{,.( ~
Pfiil Couchee
General Manager
SOUTH VALLEY DISPOSAL AND RECYCLING, INC.
CITY OF GILROY
RATE ADJUSTMENT
EFFECTIVE JULY 1, 2008
CPI RATE ADJUSTMENT
Formula outlined in Exhibit "J" Section A thru E of the
September 2, 1997 Franchise Agreement.
X (I) - X (1-2)
X (1-2)
Consumer Price Index Values
X (I) = December, 2007 = 218.49
X (1-2) = December, 2006 = 210.4
CPI = 218.49 -210.4
210.4
CPI =
70% of CPI =
Motor Fuel Index Values
X (I) = December, 2007 =
X (1-2) = December, 2006 =
MFI =
MFI =
10% of MFI =
Total CPI Rate Increase Percentage:
Single stream recycling program increase
1/2 of single stream recycling increase
Total Rate Increase Percentage
FY2008-Rate-lncr
Exhibit 1
3.84%
255.8
195.5
255.8 - 195.5
195.5
30.85%
3.09%
II
5.78%11
2.97%
1.49%
7.27%
5/16/2008 3: 18 PM
EXHIBIT B
Proposed new solid waste & recycling rates
The proposed 5.78% annual rate increase is comprised of an agreed upon annual rate
adjustment formula combining the Consumer Price and Motor Fuel Index Values. In
addition to the 5.78% proposed increase, an additional 1.49% rate increase is to pay for a
new Single Stream Recycling Program which began in January 2008. The total proposed
rate increase beginning July 1,2008 is 7.27%.
Residential Service Monthly Rate
Current Proposed
32 gallon cart 24.44 26.22
64 gallon cart 35.07 37.62
96 gallon cart 45.98 49.32
Commercial Service Monthly Rate
2 cubic yard I 3 cubic yard 4 cubic yard 6 cubic yard
Current proposed current orooosed current proposed current proposed
1 x per week 163.79 175.69 236.04 253.19 316.61 339.61 461.08 494.58
2 x per week 307.50 329.84 444.83 477.15 598.95 642.46 876.81 940.51
3 x oer week 451.18 483.96 653.59 701.07 881.27 945.29 1,292.55 1,386.45
4 x per week 594.92 638.14 862.36 925.01 1,163.61 1,248.15 1,708.28 1,832.39
5 x per week 738.61 792.27 1,071.13 1,148.95 1,445.96 1,551.01 2,124.02 2,278.33
6 x per week 882.31 946.41 1,279.90 1,372.88 1 ,728.28 1,853.84 2,539.74 2,724.25
I, SHA WNA FREELS, City Clerk of the City of Gilroy, do hereby certify that the
attached Resolution No. 2008-24 is an original resolution, or true and correct copy of a city
resolution, duly adopted by the Council of the City of Gilroy at a regular meeting of said Council
held on the 16th day of June, 2008, at which meeting a quorum was present.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of
y of July, 2008.
!
hawna Freels, C C
. City Clerk of the City of Gilroy
(Seal)