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<br />78 <br />Attachment 2 Page 31 <br /> <br />SBWMA Contractor Selection Process <br /> <br />Executive SummalY <br /> <br />Summary of SBWMA Board Recommendations <br /> <br />less than $10,000 per incident. Contractor shall notify and seek approval from <br />the SBWMA prior to completing maintenance or repairs which exceed $10,000. <br />(new) <br /> <br />C. Compensation and Rates <br /> <br />. Compensation for Collection and Facilitv Operations Contractors. The simplified <br />compensation method involves conducting a detailed review every three years <br />(or more frequently if requested by the SBWMA or member agencies) with an <br />index adjustment process in the interim years plus consideration of actual costs <br />for a few categories that are outside the contractor's control (e.g., per-gallon fuel <br />costs, workers' compensation premium rates, and insurance premiums). (new) <br />Contractor's profit would be calculated using an operating ratio. <br /> <br />Actual costs would not be reconciled to forecasted costs so that the contractor <br />compensation is not increased to make up for increased costs (or decreased to <br />reflect reduced costs) with the exception that the actual costs for a few cost <br />items would be annually reconciled against forecasted costs. The annual <br />revenue reconciliation process would be continued as currently performed to <br />make the contractors whole for its annual compensation, because the <br />contractors are not responsible for setting rates. (new) <br /> <br />. Rates for CoUection and the Facilitv. Annually, member agencies will review <br />collection rates and adjust (as appropriate). Annually, the SBWMA shall review <br />and adjust (as appropriate) the collection contractor's proposed allocation of the <br />SBWMA-wide collection contractor's compensation to each member agency, <br />and recommend each member agency's portion of the collection contractor's <br />compensation for member agency approval. (unchanged) <br /> <br />Annually, the SBWMA will review and adjust (as appropriate) fees for the <br />Shoreway facility. (unchanged) <br /> <br />. Compensation for Off-Site ProcessinQ Contractors. Compensation for <br />processing services shall be on a per-ton basis, which is adjusted annually using <br />a published economic index. For organic materials processing, the per-ton rate <br />would be adjusted using a cost index; and, for recyclable materials processing, <br />the per-ton revenue would be adjusted using a cost index or recyclable materials <br />market price index. (unchanged) <br /> <br />D. Incentives for Contractor's Performance <br /> <br />. Collection and Operations Contract. Contractor performance will be monitored <br />against established and quantifiable standards in the areas of diversion, <br />collection performance, and customer service. Incentives will be developed to <br />reward the contractors for extraordinary levels of performance. For collection <br /> <br />HF&H Consultants. LLC <br /> <br />ES-10 <br />