AgdaPkt 2013-02-25 - Laserfiche WebLink

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7.A. - Page 2 Environmental Center. South Bay Recycling, LLC (SBR) operates the Shoreway facility under separate contract with the SBWMA. SBR's costs include: operating the transfer facility; operating the recycling facility; disposal fees at Ox Mountain Landfill; processing fees for composting organic material at Newby Island and Grover Environmental; debt services payment for revenue bonds issued in 2009 for the demolition, construction and renovation of the Shoreway facility; the cost for management of the SBWMA; and the franchise fee paid to the City of San Carlos. Revenue from the sale of the processed recyclable materials is used to offset these costs. Based on the Application and subsequent audit the City's net cost for disposal and processing services at the Shoreway facility for rate year 2013 are projected to be $5,071,810. ➢ City Fees — City fees include a franchise fee (based on 13% of Recology's net revenues) and the AB939-related recycling program costs. ➢ One-Time Adjustments 0 2013 Agency Facility Allocation Adjustment — The allocation of the 2012 cost to provide services to City facilities was adjusted retroactively for 2012 based on final statistics compiled by Recology. The initial allocation for 2012 was based on projections in lieu of actual operating statistics. Recology revised the allocation for 2012 based on actual operation and the City's cost for service was increased by $130,810. o Service Level Adjustment — In accordance with the Franchise Agreement, Recology is eligible for a service level adjustment in 2013. This cost adjustment is to capture the difference between the anticipated service levels in Recology's proposal (which was compiled before Recology actually began providing service) and the actual service levels. This adjustment captures the changes in the number of single-family customers; commercial, multi-family dwellings and City facilities lifts for bins and carts and pulls for drop-boxes. This final adjustment to costs related to changes in service levels was derived from data compiled by Recology in May 2012 and included in the 2013 Compensation Application. This service level adjustment results in an increase of $160,432. 0 2011 Performance Incentives and Disincentives Payment per the Franchise Agreement — The Franchise Agreement is performance based. The incentives and disincentives are calculated annually in Recology's Compensation Application. The 2011 incentives/disincentives are reconciled in the 2012 Application and recovered in the 2013 rate review. Because of the enhanced weekly recycling and compost collection programs in 2011, the diversion from landfill goals were exceeded. The diversion incentive was partially offset by disincentive/liquidated damages owed by Recology for customer service calls exceeding the number allowed per the Franchise Agreement. The payment due Recology from the SBWMA is a net $768,347 incentive payment, of which Redwood City's portion is $159,191.