AgdaPkt 2009-02-09 reg - Laserfiche WebLink

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8A Page 2 ANALYSIS OF 2009 RATE INCREASE Allied's 2009 Operating expenses are expected to increase about 50k primarily due to 1) labor-related costs (2.60/0) and 2) higher disposal fees at the transfer station (2.20/0). Offsetting this 50/0 increase in projected operating costs are 1) 2008 revenues trending 3.1 % higher than expected (which will be the base for the 2009 revenues) and 2) 0.30/0 available in the City's balance account due to prior year's revenues being slightly higher than required. PUBLIC NOTICE In July 2006, the California Supreme Court determined that water consumption charges are property-related charges and increases in such charges are subject to the procedural provisions of Proposition 218. As a result of this decision, many public agencies are now also following the procedural provisions of Proposition 218 for increasing solid waste rates as there is some chance that the Court would also find that these charges are property- related fees. Accordingly, staff followed the procedural provision of Proposition 218 and mailed notices of this proposed rate increase to all addresses in Redwood City that receive solid waste services advising subscribers and property owners of this recommended rate increase. Under certain provisions contained within Proposition 218, if a majority of the affected property owners files a written protest against the proposed rate increase, the governing body may not approve the proposed increase. Since the deadline for submitting such written protests is 5:00 p.m. on Monday, February 9, staff will advise the C.ouncil with the number of protests filed as part of the oral presentation of this recommendation at the Council meeting. Subsequent to the preparation and distribution of these notices staff was advised that a recommended overall rate increase of 1.60/0 is required as opposed to the 2.20/0 increase mentioned in the notice. Since this is less than the rate increase listed in the notice adopting a 1.60/0 increase is permissible. UTILITIES COMMITTEE RECOMMENDATION The Council Utilities Committee reviewed this matter at their October 8, 2008 and December 10, 2008 meetings and recommends that this be brought before the full Council for consideration. FISCAL IMPACT Since the City, in accordance with the franchise agreement, does not pay Allied for the collection of the City's solid waste, there will be no cost impact to the City if this rate increase is approved. This practice is consistent for all SBWMA members. ~j~ Brian Ponty Director of Finance 2