HomeMy WebLinkAbout2022 - Residential Rate Increasean f
SIN
HOME OF PELICAN ISLAND
CITY COUNCIL AGENDA TRANSMITTAL
Council Meeting Date: September 13, 2022
Agenda Item Title: Waste Management Rate Adjustment
Recommendation: Staff recommends City Council approve a fifteen (15) percent increase
to the residential collection rates.
Background: The current Waste Management agreement (Article 12.0 adjustments
to rates) provides for an annual increase in the collection rates based on the consumer price index
(CPI) but not to exceed three (3) percent. Any adjustment above three (3) percent requires a public
hearing per Article 12.3 of the agreement.
Waste Management provided staff with documentation indicating a cost increase of twenty six and
nine tenths (26.9%) percent based on fuel, labor maintenance and operational support. Staff
researched the fuel rates and determined that the rate increase of fuel was nine and one half (9.5%)
percent from December 2021 through June 2022. Staff recommends an increase of the labor costs of
two and one half (2.5) percent and the allowable three (3) percent CIP per the contract for a
proposed increase of fifteen (15%) percent rate adjustment. Staff does not recommend approval of
the request for operational support or the maintenance increase.
The current monthly residential collection rate is twelve dollars and fifty four cents (S 12.54). Should
Council approve the residential collection rate at fifteen (15) percent, the new monthly residential
collection rate would be fourteen dollars and forty two cents (S 14.42) an increase of one dollar and
eighty eight cents ($1.88).
This Agenda Item Does Not Reouire the Expenditure of Funds:
BUDGET: N/A
Attachments:
1. Article 12 of the Solid Waste Agreement
2. Waste Management request documentation.
Administrative Services Depanme evi
City Attorney Review: r7
Procurement Division Review, iif applicaXe: -11fl
City Manager Authorization:
Date: �12
demolition, or renovation activities shall be removed by the Person responsible for the
construction, demolition or renovation activities no later than the end of the day on
which the activities occur or earlier if the waste material causes littering.
Article 11. Commercial Collection Service and Construction
and Demolition Debris Service Rates and Billing
11.0. Rates — General. The Commercial Collection Service rates set forth in this
Agreement are maximums, and volume discounts may be negotiated between the
Franchisee and the Customer. Notwithstanding the foregoing, the Franchisee and the
City acknowledge and agree that the Commercial Collection Service rates are subject to
adjustment as set forth in this Agreement.
11.1. Rates. All Customers receiving any type of Commercial Collection Service,
including Construction and Demolition Debris Service, will be charged on a per cubic
yard basis. Charges will be billed monthly in advance by the Franchisee according to
the rate schedule attached hereto marked Exhibit "A"
11.2. Other Charges. The rates for Commercial Collection Service and Construction
and Demolition Debris Collection Service do not include disposal fees, maintenance
fees, franchise fees, and other extra charges. Such fees shall not be added to a
Customer's invoice unless they are individually listed and itemized.
11.3. Billing. Billing for Commercial Collection Service, and for Construction and
Demolition Debris Service shall be the sole responsibility of the Franchisee.
Article 12. Adjustments to Rates
12.0. CPI ChaTes in Rates. Compensation payable to the Franchisee for services
provided hereunder shall be adjusted upward or downward annually to reflect changes
in the consumer price index for all urban consumers for the Southeastern US, all hems,
1982-84 equals 100, as published by the U.S. Department of Labor, Bureau of Labor
Statistics ("CPI"). Should the CPI be discontinued or substantially modified, then an
alternate index shall be chosen by mutual agreement of the City and the Franchisee.
Beginning on October 1, 2014, and on each Octoberl thereafter, the foregoing rates
shall be adjusted to reflect the increase or decrease in the CPI for the immediately
preceding twelve (12) month period of June to June, but no increase or decrease shall
exceed percent (3%) per annum. The Franchisee shall notify the City in writing of
increases that are based on the CPI, as provided in this section, no less than thirty (30)
days prior to their implementation.
12.1. Change of Law. The parties understand and agree that the Florida Legislature from
time to time has made comprehensive changes in Solid Waste management legislation
and that these and other changes in law in the future, whether federal, state or local, which
mandate certain actions or programs that may require changes or modificetions in some of
the terms, conditions or obligations under this Agreement. Nothing contained in this
13
Agreement shall require any party to perform any act or function contrary to law. To the
extent that any law effective after the effective date of this Agreement is in conflict with, or
requires changes in, the provisions of services to be provided under this Agreement, the
parties agree to enter into good -faith negotiations to determine whether the Franchisees
rates should be adjusted as a result of a change in law.
12.2. Limitation on Rate Chanoes. The Franchisee shall not be allowed a rate increase
for any reason other than those expressly specified in this Agreement. Notwithstanding
the foregoing, in the event that a federal, state or local entity imposes a fee, charge or
tax after the date of this Agreement that applies to Franchisee's operations per se,
such fee, charge or tax shall be treated as a change in law and shall be passed through
as a separate billed item after notice and confirmation by the City.
12.3. Rate Adiustment Procedure. Should the Franchisee seek an adjustment of any
charges established and approved by the Council, other than the CPI Chances in Rates
set forth in section 12.0 of this Agreement, then Franchisee shall notify the City in
writing, setting forth the schedule of rates and charges which it proposes and a written
justification for the request. A public hearing shall be held on the request. The request
for a public hearing shall be submitted to the City with supporting data for review and
presentation to the Council. The hearing may thereafter be continued from time to time
as determined by the Council. The Council shall make a determination whether the
adjustment in charges is necessary and justified under the circumstances provided
herein and set forth in Franchisee's justification for rate adjustment.
Article 13. General Obligations Of Franchisee
13.0. Prohibitions on Biological. Biomedical, and Hazardous Waste. The Franchisee
shall not Collect Biological Waste, Biomedical Waste, or Hazardous Waste and the
Franchisee shall not deliver or dispose of any of the foregoing wastes at the County
Landfill. Franchisee shall not Collect any Solid Waste that the Franchisee reasonably
believes is Biological Waste, Biomedical Waste, or Hazardous Waste. The Franchisee
shall immediately notify the Contract Manager if any Customer attempts to deliver such
material to the Franchisee or the City. The City shall have the right to inspect the Solid
Waste and Recyclable Materials Collected by the Franchisee at any time to determine
whether the Solid Waste or Recyclable Materials contain Biological Waste, Biomedical
Waste, or Hazardous Waste, and to require the Franchisee take appropriate action to
ensure that the Franchisee's Customers do not deliver such materials to the
Franchisee. The Franchisee shall promptly arrange and pay for the lawful removal and
disposal of any Biological Waste, Biomedical Waste or Hazardous Waste that the
Franchisee delivers to the County Landfill.
13.1. Silo lane. The Franchisee shall not litter, and shall not spill Solid Waste or
Recyclable Materials, anywhere in the City. Whenever the Franchisee is hauling Solid
Waste or Recovered Materials, in the City, the Franchisee shall take ail necessary steps to
ensure that the material is contained, tied, or enclosed so that leaking, spilling and blowing
of such material is prevented. In the event that any material or liquid spills, blows or leaks
14
Deborah A. Perez
Gov*..W Affairs Mana9ar
Waite Management of IWWn RN r CONxy
43107r St.
Vero Beach FL 32969
August 4, 2022
Mr. Paul Carlisle
City Manager
City of Sebastian
1225 Main Street
Sebastian, FL 32958
Dear Mr. Carlisle:
Thank you for the opportunityto provide solid waste collection services to the City of
Sebastian.
In accordance with the franchise agreement granted to Waste Management Inc. of Florida,
please accept this notice for the annual rate adjustment to reflect changes in the cost of doing
business, as provided in Ordinance No.O-13-03, Article 12, Paragraph 12.0.
Throughout 2021, the U.S. economy has been experiencing the unexpected adverse impacts of
inflation caused in large part by an economy re-emerging from COVID-19 but hampered by
labor and supply chain constraints. Not since the years Immediately following WWII or the late-
1970s has the U.S, experienced inflationary price increases at these levels. For WM, disruptions
In the supply chain for critical materials and equipment, labor shortages, and significant
Increases in fuel costs have substantially increased WM's cost to provide services to your
community. As just one example, the price of the steel WM needs for solid waste and recycling
vehicles and containers has increased more than 150%over the past 12 months. Many
economists are projecting continued labor shortages and upward pressure on labor and critical
material costs.
Utilizing the common industry Price Increase Index of CPI-U, the full adjustment amount is 5.84%,
but due to the NTE clause of 3.00%, our CPI request is for the 3.DD%effective October OS, 2022.
The new rate would be $12.92 per home, which is a $0.38 per home increase. Back up
Information is Included for your review.
Due to the unforeseen and extraordinary market conditions mentioned above, which the
parties could not anticipate at the time the contract was executed, WM respectfully requests a
26.9096 adjustment to allow WM's compensation to better keep pace with WM's operating
costs to provide critical services in your community. If approved, the adjustment would be
applied bringing the total monthly price per home to $15.91 per home, effective October 01,
2022. As you can see from the supporting backup, our extraordinary inflationary costs
ITAI J
increased by $3.37 per home.
Deborah A. Perez
Government Affairs Manager
Waste Management of Won "r County
43107y St.
Vero Bead% R 32969
WM is as committed as ever to provide best -in -class service to our customers and the
communities we call home. We appreciate your partnership as we address these unusual
market conditions.
Should you have any questions, please do not hesitate to contact me at (407) 466-4079.
Sincerely,
Deborah A. Perez
Government Affairs Manager
Cc: Chris Bolyard, Pricing Manager, Florida Area
Kasey Godwin, District Manager, Vero Hauling
Bob DelaCruz, Operations Manager, Vero Hauling
Eshibh "A"
City of Sebastian -Sole Waste Franchise
Sebastian Eflecr,s 10/112022
1
2
2
$
53.55
$ 88.13 $
S
3
$
70.84
$ 12271 $
I
4
$
88.13
$ 157,29 5
Z
6
$
122.71
$ 226.45 $
E
8
E
157.29
§ 295.61 §
F R E Q U E N C Y
(Includes Container Sesia Coupe)
3
4
6
122.71
$ 157.29
S
191.87
$
174.58
$ 226.45
$
278.32
226.45
$ 295.61
$
364.77
$
330.19
$ 433.93
$
537.6'
I $
433.93
$ 572.25
If
710.57
I IN
Container
8
Sen4co Oth,
XPU
226.46
$ 16.9all
S
18.46
330.19
$ 18.9'
S
27.69
433.93
E 16.9""/
I S
36.92
641.41
If 1a
$
55.38
848.89
$ 78.91
I 3
73.84
6% Franchise F"i���In all c���
8 3 99 Billed Cubic Yard
$ - Billed Loh $1l gtlY6r4Y r
$ - Fuel SurWerae 1f'� ArmunV f P, Istm$m ormmne`m
$ 15.93 Biled Cubic Yerd Compactor( ams ame) fEL Compactors
$ 923 Blind extra pickup per FEL odic yard
$ 2770 Bleed extra pickup per FEL compactor cubic yard
coso98acw. cpsrvAeroB ro ra7SraNrrt-wAatEaUNACGMB�r-er
J F IN C U E E N C Y
1 2 I $ 138.06 I $ 276.1` I S 3414.18 I $ 4 552.24 I $ 690.30 I $ 828.36
rzaus6rtnv, weraArero cusruN,w wAsrewruoarevr-ea4eo:
Cie Carfhwk Fxmaaer parr
196 Gaibn 1 $18.361 f18.361
RESmBl)Ml. M7ET io WSiha®t- WA5IENANAO6a91T-Be1LD:
Genla red Tonh Ix
I Simple Hama I 12.921 $0.001
WM 64 Gallon Can- Oehul
W M 36 Gallon Cart- Option
1 Resieentisl it OOppI ICharles ps wrvko o. wn
ILost Ca z Alirl$dL 7qr oa/Irm
Note: NerMicap -bar*daMas of show, rofe3. Na eodil/ena/ n.
AhfrorW CM
roll ov�p�� aeMr
$12.921 If '1ll.76 1 $38.761
f28.871
f85.60
Container
Calling Pug
Servka
aoaolrsewb
Ram
CNry�
15 Yard Open Top Per Pull
$222;5
5114.31
20 Yard Open Top Per Pull
$222 l
$11451
30 Yard Open Top Per Pull
f222.54
$114.31
40 Yard Open Top Per Pull
$222-541
$114.31
20 Yard orless COMPACTION CPer PUN
SM.S4
f1311M
jntmainrrs
ooneeP lI
221 tc40OVE7Aif�'C1
$22254
f1M.68
(11A Dra
LANDFILL
M'minum one haul per month, no container service Marge
7/19/2022 12 M PM City of Sebastian CPI October 2022
XPU I
$ 55.38
Page 1
CPI for All Urban C4Nlsumom (CPI.U)
Original Data Value
Bumau of L.e.. SIa1Isbcs
For the City of Sebastian
s•rMS Id:
C Llm 00. .cuu503005M
Not ssuenaly mIusbE
,arks Tills:
Aa Ilan, Fsouls
urban. all urban
consumes. sal lumonaty adlnatad
Aros:
scan
6Bm:
Auden.
9sse INvdod:
1M U=1
W
Yea.:
N12102022
Year
Jan
Fab
Mar
Apr
may
Jun
Jul
Aug
asp
Oct
Nov
DK
Mnual
N F1
NALF2
2012
2XIAW
221.602
223.314
224.215
223.355
223.004
M.667
223919
225.052
224.504
223.A%
223.1W
223242
222.708
223.776
2013
223.933
225074
226.628
226.292
226.2W
227.148
227.548
22T.837
227.076
227.420
2M.811
227.082
228.721
226.012
227.429
2014
227.873
228.884
MW5
231.346
231.762
232289
232,013
231.811
231.762
231.131
229.845
228,451
2W.552
230.302
230.602
201I4
2N.855
227.944
229.337
229.957
2W.968
232.029
231.719
231260
230,913
2W.BW
230.422
229.581
2W.147
229.501
230.793
2010
229AW
229M
230.977
231.975
232.906
2M.838
233.292
231.561
234.089
234.337
234.029
234.204
232892
231A69
233.915
2M7
2WAW
238.052
2MAN
236.728
238.7/4
237.348
236042
237.892
2N.849
239.OB7
238.861
238.512
n7.4%
2J A24
2WAfir
me
239.7T2
241.123
241.595
242.486
20.279
243.770
243.n6
243605
243.840
244.183
243.484
242AW
242.T31
242.004
N3A70
2M9
242.M?
243.856
245.5M
246.847
246.667
246.515
247.2W
246.9521
20091
247.423
247.385
247.20
248285
245.331
24TAN
2020
240M
20.412
248AW
246.254
245.6W
247.223
248.819
249639
250.183
250.M2
2W255
250.693
248.639
247.268
249.990
2021
252062
253.358
255.319
257.207
259.343
261.668
283013
263728
264.593
MAW
268.3W
269.20
281259
256.408
2W.020
2022
2T1.834
274.888
278.598
2T9.879
283.367
287A27
270.256
Index Change=
25.759
CPI Change=
5.a0%
CPI Max 3%=
Lum
Ul Appaed=
Swan: Burmu of taEa sletla9n Gmamtad on. July M. 2021 (0725:21 AM)
Jurisdiction / Contract / Franchise
Business Unit
Time Periods Current Period
Prior Period
City of Sebastian
04835 WM of Indian River County
YTD Jun, 2022
YTD Jun, 2021
Monthly Rate Per Home / Account
$
12.54
Cost Increase %
Labor
7.61%
Maintenance
5.11%
Ops Support
1.99%
Fuel
12.18%
Monthly Increase Amount
$
3.37
New Monthly Rate
$
15.91
Exhibit"A"
CXy of Sebastian - Solid Waste Franchise
Sebastian Effect" 101112021
F
R E
0 U E N
C Y
(Includes Container Service
Charge)
I1
2
3
4
5
Y
f 51.96
$
85.50
f
119.04
S
152.Si( $
186.1'
S
S
17
$ 68.73
f
719.01
$
169.35
f
219.66 E
269.97
f
I
4
f 85.50
$
152.58
$
219.66
f
286.74 f
353,62
$
Z
B
S 119.04
S
219.66
f
320.28
f
420.90 $
521S
I $
E
IB
S 152.58
$
286.74
$
420.90
f
555.06 S
689. 2(f
S
Container
6
Service Cho A¢
L'
XPU
219.66
S
15
S
17.92
320.28
$
18.42
f
26.88
420.90
$
18.42
$
35.84I
622.14
S
18.P
f
53.76I
823.38
f
18.42
f
71.68I
B%Fnnchiee Fae Inclutletl In all rJnraas
5 3.87 Silted Cubic Yard
$ - Billed Loose Yard
6 - ((AnrnuM87 =)w nmrpgu02
$ 154] Billed Cubic Ya Conyactor (Hams ma) FEL Campxlps
$ 896 Billed ends pickup per FEL cubic yard
5 2689 Billed ezks pickup Per FEL compactor cub c yard
caear8new.CCMP4cRal ronrs7eraa- wAs1EYANA0f31B1i-arum:
F R E 0 U E N C Y
2 32 f 1134.07 I f 268.15 I f 402-22 I S ' S36.29 I $ 670.37 I S 804.44
col®ra8au cwreere rocuslowea- wAsrerAN4earexr•aa,.n.
Dp bmf LlLe B.naafilCur
196 Gallon 1 $17.831 $17.831
a8sro8xnaL rum roeuslavee- w4sreNAN4oag:xr-alum:
Aadwurud
Ge64A4 Y.N 7n0 1. raw Oue4q(� Q ae1Y
I Single Home I f12.541 $0.001 f12.641 f 7T.82 1 $37.621
WM 64 Gallop Can - Oefauh
AIMM
36 Gallon Can -Option
lRosidenthilCari�uJ/Note: A ervef l Chains,�
03
ILoatCan I 56.0
eefw�fNo adtlrtron
XPU I
$ 53.76
Container
Calling Pull
Service
aorlonbwln
Rate
Clyry�
15 Yard Open Top Per Pull I
S216.06J
5710.981
20 Yard Open Top Per Pull
f218.00
$110.98
30 Yerc Open Tap Per Pull
f216.00
f110.98
40 Yard Open Top Par Pull
$216.061
$110.98
20 Yard or leas COMPACTION Containers Per Pull
f218.08
$134.52
21 to 40 rd COMPACTION contain Per Pull
ABOVE RATES ARE SUBJECT TO ADDITIONAL LANDFILL FEES
f278.68
f134.52
Minimum one haul per month, no container sennCe charge
7/202021 742 AM City of Sebastian CPl October 2021
Pagel