5 Resolution of the City Council of the City of Livingston Approving the Annual CPI Service Rate Adjustment for Gilton Solid Waste Management Services, Inc.

MEETING DATE: June 02, 2015

AGENDA ITEM #5

Note from TheGardeningSnail. Parts of this page may have been created by running a PDF Image file through a program that converts Image to Text. My apologies for any Textual Gremlins that may have crept in. I’ve also broken up some of the longer paragraphs to make reading easier.

STAFF REPORT

AGENDA ITEM: Resolution of the City Council of the City of Livingston Approving the Annual CPI Service Rate Adjustment for Gilton Solid Waste Management Services, Inc.

MEETING DATE: June 2, 2015

PREPARED BY: Odi Ortiz, Interim City Manager/Finance Director

REVIEWED BY: Odi Ortiz, Interim City Manager/Finance Director

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RECOMMENDATION:

City Council consider the proposed annual 2.5% CPI Service Rate Adjustment for Gilton Solid Waste Management Services as per current contract, effective July 1, 2015.

BACKGROUND:

On April 2, 2013, the City and Gilton Solid Waste Management, Inc entered into a new service agreement as a result of an RFP process. This agreement contains provisions granting Gilton Solid Waste Management to request Service Rate Adjustments on the one (1) year anniversary and each anniversary thereafter. Such adjustments will be based on the Consumer Price Index for All Urban Consumers (CPI­U) published by the U.S Department of Labor for the San Francisco-Oakland-San Jose, CA statistical area and on changes to the disposal fees charged by the Merced County Regional Waste Management Authority.

Gilton has confirmed that Merced County has no plans to increase disposal fees at the landfills during 2015-16. The City approved a 2.4% CPI-U on June 2014. This second annual service rate adjustment is solely on the 2.5% CPI-U as of February 2015. City incorporated a 2.5% cost inflator (CPI) on the utility rate study performed and approved by Council in 2013 for these contracted services. Operational costs (contract cost) of the City will increase as the result of this CPI adjustment. Rates to Livingston’s customers will not be impacted by this adjustment.

DISCUSSION:

City Council to consider approving the requested 2.5% CPI-U service rate adjustment for Gilton Solid Waste effective July 1, 2015.

FISCAL IMPACT:

Costs associated with the proposed adjustment of 2.5% will be included on the City’s 2015-16 operating budget. CPI rate adjustments have been incorporated in the 2013 utility rate study.

ATTACHMENTS:

1) Annual Rate Adjustment Request dated March 27, 2015 by Gilton Solid Waste Management Inc.

2) Exhibit B: Revised/proposed rate/fee schedule to the City

3) Resolution No. 2015-_, a Resolution of the City Council of the City of Livingston Approving the Annual CPI Service Rate Adjustment for Gilton Solid Waste Management Services, Inc.

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RESOLUTION NO. 2015-

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LIVINGSTON APPROVING THE ANNUAL CPI SERVICE RATE ADJUSTMENT FOR GILTON SOLID WASTE MANAGEMENT SERVICES, INC.

WHEREAS, the City of Livingston and Gilton Solid Waste Management entered into a new service agreement on April 2, 2013; and

WHEREAS, agreement provisions grant an annual rate adjustment for such contracted services; and

WHEREAS, rate adjustment requests should be granted on anniversary dates at least 90 days prior to effective date of proposed rate; and

WHEREAS, rate adjustment shall be based on the Consumer Price Index for All Urban Consumers (CPI-U) published by the U.S Department of Labor for the San Francisco-Oakland-San Jose, CA statistical area and on changes to the disposal fees charged by the Merced County Regional Waste Management Authority; and

WHEREAS, the proposed rate adjustment by Gilton Solid Waste is 2.5% effective July 1, 2015; and

WHEREAS, a cost inflator or CPI of 2.5% was incorporated on the 2013 utility rate study for solid waste services to capture potential increases in service costs; and

WHEREAS, the City wishes to approve this 2.5% rate adjustment effective July 1, 2015 as supported by the CPI-U; and

WHEREAS, the revised proposed service rates to the City effective July 1, 2015 are reflected on Exhibit B attached.

NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Livingston hereby adopts a Resolution to approve the 2.5% annual CPI rate adjustment for Gilton Solid Waste Management Services.

Passed and adopted this 2nd day of June, 2015, by the following vote: AYES:

NOES:

ABSENT:

ABSTAIN:

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Rodrigo Espinoza, Mayor of the City of Livingston

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ATTEST:

I, hereby certify that the foregoing resolution was regularly introduced, passed and adopted at a regular meeting of the City Council of the City of Livingston this 2nd day of June, 2015.

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Antonio Silva, City Clerk of the City of Livingston

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