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6.C. - Page 57 of 57 <br />Recology <br />WASTE ZERO <br />September 8, 2020 <br />Joe LaMariana <br />Executive Director <br />SBWMA <br />600 Elm Street <br />San Carlos, CA 94070 <br />Re: Town of Atherton's remaining Indirect Cost Compensation <br />Dear Mr. LaMariana, <br />As you accurately described during the August 20, 2020 Special Meeting of the South Bayside <br />Waste Management Authority (SBWMA), with the Town of Atherton's (Town) possible exit from <br />SBWMA, certain fixed costs associated with the collection services being provided by Recology <br />San Mateo County (Recology) will remain. Recology's Rate Year 2021 Compensation Application <br />includes $386,451 relating to the Town of Atherton's Allocated Indirect Costs. The Allocated <br />Indirect Costs include General and Administrative, Operations, Vehicle Maintenance and <br />Container Maintenance costs. <br />Attachment K Table 1.F of the Amended and Restated Franchise Agreement indicates that the <br />annual Allocated Indirect Costs amount shall equal $17,429,667 for Rate Year 2021. This amount <br />was subsequently reduced to $16,429,667 during final contract approval. Section 8 of <br />Attachment K describes that Rate Year 2021 Contractor Compensation was allocated among the <br />Member Agencies using the methodology described in the 2009 Franchise Agreement <br />(Attachment K, subsection 6.13). Attachment K, Section 6.B.l.h of the current agreement <br />describes the methodology used to allocate Indirect Cost to each Member Agency be based on <br />each Member Agency's proportionate share of accounts for General and Administrative Costs, <br />annual route hours for Vehicle Maintenance Costs, containers in service for Container <br />Maintenance Costs and annual route hours for Operational Costs. <br />Percentages changes to the remaining jurisdictions resulting from the reallocation of the Town's <br />Allocated Indirect Costs range from 0.24% to 0.56% (less than 1%) of the Revenue Requirement <br />identified in Table 8 of the SBWMA's Draft Report Reviewing the 2021 Recology San Mateo <br />County Compensation Application. A chart which includes the annual amount of each Member <br />Agency's change as well as the percentage changes and an updated Attachment N, which <br />includes these reallocated costs, will be forwarded to you separately. <br />Please contact me should you have any additional questions. <br />Respectfully, <br />Michael Kelly <br />General Manager <br />225 Shoreway Road I San Carlos, CA 44070-2712 11: 650.595.3900 I Recology.com <br />