City of Palo Alto (CA) Staff Report: Refuse Cost of Service Study (2012)

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City of Palo Alto (ID # 2409)

Finance Committee Staff Report

Report Type: Meeting Date: 3/6/2012

March 06, 2012 Page 1 of 13

(ID # 2409)

Summary T itle: Refuse Cost of Service Study Results

Title: Results of Refuse Cost of Service Study and Plan for Restructure of Refuse

Rates

From: City Manager

Lead Department: Public Works

Recommendation

Staff recommends that the Finance Committee recommend to the Council that:

1) Residential refuse rates be increased over a short term, but phased approach, tostabilize the Refuse Fund and avoid a projected sector imbalance between theresidential and commercial ratepayers;

2) New residential rates for FY 2013 be structured using both a fixed and a variablecomponent with the fixed component representing the cost for street sweepingdeveloped by the cost of service model; and

3) A special rate stabilization and commercial outreach reserve dedicated to thecommercial sector be established and the Refuse Fund’s expected revenues overexpenses for FY 2013 be directed into this commercial reserve, with no change in

commercial refuse rates in FY 2013.

Executive SummaryThis report provides the results of the Refuse Cost of Service Study and makesrecommendations for residential refuse rate changes. The Cost of Service Study(COSS) concludes that the existing rate structure results in a commercial and residentialimbalance where the residential rates are not at a full cost recovery level while thecommercial rates are in excess of expenses. Accordingly, the COSS recommends newresidential rates that would bring the residential sector to a position of full costrecovery. Much of this imbalance has been caused by the past “conservation pricing” program, the incentive pricing system which lowers the cost for small garbage cansizes to encourage waste reduction.

Staff recommends that new residential refuse rates which would eliminate the residential sector subsidy be phased in over a short term period not to exceed three years. Staff does not recommend that conservation pricing be fullyeliminated over this three-year period. However, staff does recommend introduction of a flat rate component which would, in effect, reduce the level of conservation pricing.




(ID # 2409)

BackgroundIn August 2010, the Refuse Cost of Service Study (COSS) was initiated in response tofalling revenues in the Refuse Fund and the need to reevaluate the refuse ratestructure. A particular concern was that refuse rates were based entirely on garbage

can size, but expected to fund a broad range of programs including garbage collectionand disposal, yard trimmings collection and processing, recycling collection andprocessing, commercial organics collection and processing, street sweeping, householdhazardous waste, the Palo Alto landfill, and the annual clean-up day. As residentsswitched to smaller garbage can sizes through the success of the Zero Waste programsand as the economic downturn impacted services provided to businesses, revenuesdeclined sharply.

In addition to developing a rate structure that would result in more stable revenues, theCOSS was also expected to address California’s Proposition 218. Proposition 218requires that property-related fees, including refuse rates, be no greater than the costto provide the service. At the time the last COSS was conducted Proposition 218 didnot apply to Refuse rates.

In 2011, in an effort to address some of the early findings of the COSS and to avoidexacerbating the sector imbalance, the Council implemented a flat rate residential rateincrease of $4.62 that became effective in October 2011. In addition, Councilauthorized a $1.25 Million short term General Fund loan to ensure the overall health of the fund during the preparation of the COSS.

Discussion

This report provides information on the current financial outlook for the Refuse Fund,the residential rate structure proposed by the COSS, and options for modifying theresidential rates. This information is based on the draft FY 2013 budget for the RefuseFund, and the financial outlook and proposed rates will be updated when the FY 2013budget is finalized.

Refuse Fund Financial Outlook The cost of service model that has been developed during the study includes a 10-yearfinancial forecast that analyzes expected revenues and expenses for each year. Table 1provides the model forecast for Fiscal Years 2013 through 2016, as well as theprojected revenues and expenses for FY 2012. These figures represent the base

financial outlook in that they do not assume any changes to the current refuse rates.These figures also assume that the authorized General Fund loan of $1.25 million to theRefuse Fund for FY 2012 is not utilized, and therefore does not need to be repaid in FY 2013. The authorized loan amount was reduced to $625,000 at mid-year to maintain asafeguard because the current FY 2012 projections are not certain. While thesenumbers are projections in the out years and will be refined from year to year, themodel is an important tool in achieving rate stabilization in the Refuse Fund.




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Table 1: Refuse Fund Base Financial Outlook (thousands of dollars)

Fiscal Year (FY) 2011(actuals)

2012(projected)

2013(model)

2014(model)

2015(model)

2016(model)

Revenues 31,488 31,083 28,958 28,958 28,958 28,958

Expenses 31,435 31,116 27,711 27,439 28,059 28,705

Change in Net Assets 53 0 1,247 1,519 899 253

Operating Reserve 53 53 1,300 2,819 3,718 3,971

The current Refuse Fund financial outlook represents a significant improvement over the figures presented to the Finance Committee from the preliminary cost of service model in April 2011. Reasons for the improvement tothe Refuse Fund outlook include the following:

• The residential fixed monthly charge of $4.62 approved by City Council increases

FY 2013 revenue by approximately $980,000.• The permanent closure of the Recycling Center is expected to reduce FY 2013

expenses by approximately $400,000.

• Closure of the Palo Alto landfill in July 2011 results in significant reductions toexpenses.

• Staff has continued to identify opportunities to reduce budget amounts whereverpossible.

• A comprehensive review and update of Refuse Fund staffing allocations isprojected to reduce FY 2013 expenses by approximately $600,000.

• Increased revenues resulting from service audits comparing services provided inthe field with services indicated and billed by SAP

Cost of Service Study (COSS) Results for SectorsThe cost of service model utilizes the full dataset of SAP customer information togenerate projected revenues. Revenues and expenses are allocated to the threecustomer sectors (residential, commercial, and rolloff), and then to services such asgarbage, recycling, household hazardous waste, and street sweeping. The allocatedexpense information is used to develop rates for the various services. Assumptionsabout growth in customer numbers and inflation, as well as any planned rate changes,are used to develop a ten-year forecast of revenues and expenses.

Table 2 provides the FY 2013 expenses for the three customer sectors and theindividual services within each sector. Figure 1 uses residential garbage service as anexample of how various expenses are allocated to each service.

Table 2: FY 2013 expenses for the three customer sectors

Residential Commercial Roll-off

Garbage $4,076 $4,963 $4,108




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Recycling $1,778 $794 $0

Organics $2,230 $2,481 $0

Cleanup Day $475 $321 $0

Palo Alto Landfill $1,180 $1,932 $1,145

HHW $599 $0 $0

Street Sweeping $1,415 $216 $0Total $11,752 $10,705 $5,253

Figure 1: Breakdown of expenses allocated to residential garbage service, thousands of dollars (* includes Palo Alto staff costs; total staff costs are approximately$225)

$197, 5%

$789, 19%

$465, 11%

$119, 3%

$276, 7% $96, 2%

$153, 4%

$1,981, 49%

Allocated Charges*, 4%

Administration*, 2%

GreenWaste, 49%

SMaRT Debt, 5%

SMaRT Operation, 19%

Kirby Disposal, 11%

Kirby Put or Pay, 3%

Zero Waste*, 7%

A key goal of the cost of service study is to develop rates that assure that the revenuesfrom each customer sector cover the expenses for that sector, so that no customersector is subsidizing the rates of another. Table 3 provides the FY 2013 revenues andexpenses by sector that demonstrate a current imbalance between the residential andcommercial sectors.

Table 3: FY 2013 revenues and expenses by sectorLine of Business Estimated

RevenueEstimatedExpense

RevenueChange

Required forParity

Preliminary Value From April 2011

Residential $8,903 $11,752 +32% +79%




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Commercial $14,642 $10,705 -27% -42%

Roll-Off $5,413 $5,253 -3% +28%

For FY 2013, residential expenses are projected to exceed revenues by approximately

$2.8 million, while commercial revenues are projected to exceed expenses byapproximately $3.9 million. Therefore, a residential revenue increase of approximately32%, and a commercial revenue decrease of approximately 27%, would be required toreconcile the estimated difference between residential and commercial revenues andexpenses in FY 2013. Table 3 also provides the preliminary percent revenue changefigures that were provided to Finance Committee on April 5, 2011. At that time, theestimated residential revenue increase needed was 79%. The change in estimatedresidential revenue increase needed from 79% to 32% is due to the fixed residentialmonthly charge of $4.62 that was adopted for FY 2012 and to numerous improvementsand corrections to allocation methods used by the cost of service model.

Cost of Service Study (COSS) Results for Residential RatesThe cost of service model uses the customer census information and the allocatedexpenses for the residential sector (shown in Table 2) to derive residential rates thatbalance revenues and expenses for the residential sector, and that eliminateconservation pricing from the refuse rate structure. The rates derived for FY 2013 bythe model are provided in Table 4.

Table 4: FY 2013 residential refuse rates derived by cost of service model

Minican 32-gal 64-gal 96-gal 128-gal

Garbage 14.16 17.40 26.03 34.66 47.67Palo Alto Landfill 2.97 4.75 9.50 14.25 19.00

Recycling (64-gal) 7.66 7.66 7.66 7.66 7.66

Yard Trimmings (96-gal) 10.99 10.99 10.99 10.99 10.99

Cleanup Day 2.08 2.08 2.08 2.08 2.08

Street Sweeping 6.71 6.71 6.71 6.71 6.71

HHW 0.88 0.88 0.88 0.88 0.88

Total: $45.46 $50.48 $63.86 $77.24 $95.00

The rates provided in Table 4 vary only with the size of the customer’s garbage canbecause recycling containers and yard trimmings are assumed to be 64 gallon and 96gallon sizes, respectively. The model also provides rates for recycling and yardtrimmings that vary based on the size and number of containers. There are problemswith attempting to immediately implement varying rates for recycling and yard




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trimmings that are discussed later in this report.

Table 5 compares the current residential refuse rates with the FY 2013 rates derived bythe cost of service model.

Table 5: Comparison of FY 2013 model and current residential ratesCurrent Rate

Including FixedModel Rate for FY

2013Percent Increase

Minican $20.52 $45.46 121%

32-gallon $37.48 $50.48 34%

64-gallon $72.46 $63.86 -12%

96-gallon $106.38 $77.24 -27%

128-gallon $140.30 $95.00 -32%

Table 6: Current breakdown of residential service levels.

Service Level Number of Customers Percent of Customers

Minican 5,191 29.2%

32-gallon 9,894 55.7%

64-gallon 2,373 13.4%

96-gallon 258 1.5%

128-gallon 41 0.2%

Total: 17,757 100%

Given the magnitude of the rate increases that are needed for minican and 32-gallonservice to reach the cost of service model rates, staff recommends that rate increasesbe phased in over some number of years. Phasing in the rate increases is mostimportant to reduce the impact on ratepayers, but there are additional reasons to takethis approach. First, staff intends to use the cost of service model that was developedfor the study on an ongoing basis. The model will be updated each year with revisedcustomer census, tonnage, budget, and other information that will be used by themodel to modify expense allocations and update the rates. Staff expects that the ratescalculated for FY 2013 will change as adjustments to the model are made. Inparticular, any further expense reductions will result in reductions to the rates

calculated by the model.

Second, changes to the City’s SAP software are needed before some changesassociated with the rates can be implemented. For example, SAP does not currentlytrack the size and number of recycling and yard trimmings containers used by eachcustomer. SAP must be modified to track this information, and to include thisinformation in the billing process, before variable rates for recycling and yard trimmingscan be implemented. In addition, the interface between GreenWaste’s database and




(ID # 2409)

the SAP system must be upgraded to allow GreenWaste to update this customerinformation in SAP.

Finally, outstanding issues relating to multi-family residential customers should beaddressed before the rate structure is finalized. Under the current rate and billing

system, multi-family residents who have individual service are considered residentialcustomers, but multi-family residents who share service (e.g. 40 unit apartmentcomplex with a 8-yard garbage bin) are classified as commercial customers. Thissystem of classifying multi-family residents based on their service type raises concernsabout the fairness of charges for the annual clean-up day service, street sweeping, andhousehold hazardous waste.

Staff evaluated several options for phasing in changes to residential refuse rates.These options included the following to eliminate sector imbalance and conservationpricing:

• Option 1: 2 year phase-in• Option 2: 3 year phase-in• Option 3: 5 year phase-in• Option 4: 7 year phase-in• Option 5: 7 year phase-in (eliminate sector imbalance in 3 years, eliminate

conservation pricing in 7 years)

Options to eliminate sector imbalance but not immediately eliminate conservationpricing are:

• Option 6: 3 year phase-in (fixed percentage increase each year to all rates)

• Option 7: 3 year phase-in (flat increase each year to all rates)

• Option 8: 3 year phase-in (flat increase combined with fixed percentageincrease)

Figures 2, 3, 4, and 5 display the residential rates that result from Options 1, 2, 3, and8, respectively. Figures for all eight options, including the annual percent changes toeach rate that result, are provided in Attachment A.

Figure 2: 2 year phase-in of rates that eliminate sector imbalance and conservationpricing (Option 1)




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$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012 FY 2013 FY 2014

Year

R a t e

Minican

32-gallon

64-gallon

96-gallon

128-gallon


$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012 FY 2013 FY 2014 FY 2015

Year

R a t e

Minican

32-gallon

64-gallon

96-gallon

128-gallon




(ID # 2409)


$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Year

R a t e

Minican

32-gallon

64-gallon

96-gallon

128-gallon

Figure 5: 3 year phase-in of rates that eliminate sector imbalance but do not eliminateconservation pricing using a combination of flat and percentage increases (Option 8)



March 06, 2012 Page 10 of 13

(ID # 2409)

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

FY 2012 FY 2013 FY 2014 FY 2015

Year

R a t e

Minican

32-gallon

64-gallon

96-gallon

128-gallon

Figure 6 uses the two levels of service with the lowest and highest rates, the minicanand 128 gallon service, to compare the four options that use a three year rate phase-in

(Options 2, 6, 7, and 8)



March 06, 2012 Page 11 of 13

(ID # 2409)

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

$200

FY 2012 FY 2013 FY 2014 FY 2015

Year

R a t e

Option 2: Minican,eliminate conservation

pricing

Option 6: Minican,

eliminate sectorimbalance with fixedpercent

Option 7: Minican,eliminate sectorimbalance with flat

increases

Option 8: Minican,eliminate sectorimbalance with

combined approach

Option 2: 128-gallon,eliminate conservationpricing

Option 6: 128-gallon,eliminate sectorimbalance with fixedpercent

Option 7: 128-gallon,eliminate sectorimbalance with flatincreases

Option 8: 128-gallon,eliminate sectorimbalance with

combined approach

128 gallon

Minican

Staff recommends that new rates that eliminate the sector imbalance, but that do notimmediately eliminate conservation pricing, be phased in over a period not to exceedthree years. Further, it is recommended that the increase in FY 2013 be a combinationof a flat increase of $2.09 and a fixed percentage increase of 5.3%. The residentialrate increase in FY 2012 consisted of a flat monthly charge of $4.62. This chargecurrently appears on customer bills as “Fixed Resid. Monthly Charge”. The current flatmonthly charge can be changed to a fixed charge of $6.71 for Street Sweeping (asderived by the cost of service model), an increase of $2.09. A further increase toresidential rates of 5.3% would also be applicable in FY 2013. This approach, which is

shown in Figure 5, would eliminate the sector imbalance over a three-year period whilebeginning to address conservation pricing. An additional benefit is that the fixed chargeon customer bills would represent the actual cost of street sweeping services, while thecurrent fixed charge does not align with any specific service. Staff is not recommendingusing the General Fund loan at this time. No increase is recommended for thecommercial structure.



March 06, 2012 Page 12 of 13

(ID # 2409)

Commercial Reserve As described earlier and depicted in Figure 1, the Refuse Fund base financial outlook forFY 2013 includes revenues over expenses of $1.25 million. The recommendedresidential rate increase for FY 2013 is expected to generate $0.88 million. If staff’srecommendation for FY 2013 is adopted, revenues over expenses for FY 2013 would be

expected to total $2.1 million. The commercial sector is projected to generate revenuesin FY 2013 that are greater than expenses by approximately $3.9 million. In lieu of lowering commercial rates in FY 2013, staff recommends that the surplus of $2.1 millionbe designated as a special commercial reserve. This reserve would be dedicated tocommercial purposes such as commercial rate stabilization and enhanced commercialprograms. The reserve could also be used to fully fund the commercial share of thePalo Alto landfill post-closure costs.

Table 7 provides the Refuse Fund Financial Outlook through FY 2013 assumingadoption of staff’s recommendations for residential rate increases and establishment of a commercial reserve. It should be noted that the remaining Residential/Commercialimbalance of $480,000 at the end of the three year phase-in (FY 2015) is due to theassumption of a three year phase-in of residential rates calculated for FY 2013. Theserates will need to be adjusted each year to account for year to year inflation of expenses as well as any expense reductions that are implemented.

Table 7: Refuse Fund Financial Outlook With Recommended Residential Rate Increases

FY 2011(actuals)

FY 2012(projected)

FY 2013(model)

FY 2014(model)

FY 2015(model)

Revenues 31,488 31,083 29,834 30,709 31,585

Expenses 31,435 31,116 27,711 27,439 28,059

Change in Net Assets

53 0 2,123 3,270 3,526

CommercialReserve

NA NA 2,123 5,393 8,919

RemainingRes/CommImbalance

NA NA 1,814 958 480

TimelineFollowing direction by Finance Committee, staff will finalize the refuse rates for FY 2013. The Refuse Fund projections and rates presented in this report will be updatedas the FY 2013 budget is refined. Staff will return to Finance Committee with the finalproposed rates in April 2012. Staff will then begin the Proposition 218 notification



March 06, 2012 Page 13 of 13

(ID # 2409)

process in coordination with the Utilities Department. Following City Council adoption,the new rates will become effective on July 1, 2012.

Resource ImpactThe recommended residential rate increase is estimated to result in revenues over

expenses of approximately $2.1 million in FY 2013. This surplus would be designated ina special commercial reserve dedicated to the commercial sector.

Policy ImplicationsThe proposed Refuse Rate increase is consistent with current City Policies.

Environmental ReviewThe proposed actions do not constitute a project pursuant to CEQA.

Attachments:

• Residential Rate Options (PDF)

Prepared By: Brad Eggleston, Manager Solid Waste

Department Head: J. Michael Sartor, Director

City Manager Approval: ____________________________________

James Keene, City Manager



Option 1: 2 Year Phase-in (eliminates sector imbalance and conservation pricing)

Rate Increase Schedule

FY 2012 FY 2013 FY 2014

Minican $ 20.52 $ 33.21 $ 45.89

32-gallon $ 37.48 $ 44.22 $ 50.96

64-gallon $ 72.46 $ 68.47 $ 64.47

96-gallon $ 106.38 $ 92.19 $ 77.99

128-gallon $ 140.30 $ 118.43 $ 96.56

Rate Increase Percentages FY 2012 FY 2013 FY 2014

Minican NA 62% 38%

32-gallon NA 18% 15%

64-gallon NA -6% -6%

96-gallon NA -13% -15%

128-gallon NA -16% -18%

$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012 FY 2013 FY 2014

Year

Rate

Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon





FY 2012 FY 2013 FY 2014 FY 2015

Minican $ 20.52 $ 28.98 $ 37.43 $ 45.89

32-gallon $ 37.48 $ 41.97 $ 46.47 $ 50.96

64-gallon $ 72.46 $ 69.80 $ 67.13 $ 64.47

96-gallon $ 106.38 $ 96.92 $ 87.45 $ 77.99

128-gallon $ 140.30 $ 125.72 $ 111.14 $ 96.56

Rate Increase Percentages FY 2012 FY 2013 FY 2014 FY 2015

Minican NA 41% 29% 23%

32-gallon NA 12% 11% 10%

64-gallon NA -4% -4% -4%

96-gallon NA -9% -10% -11%

128-gallon NA -10% -12% -13%

$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012 FY 2013 FY 2014 FY 2015

Year

Rate

Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon





FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Minican $ 20.52 $ 25.59 $ 30.67 $ 35.74 $ 40.82 $ 45.89

32-gallon $ 37.48 $ 40.18 $ 42.87 $ 45.57 $ 48.26 $ 50.96

64-gallon $ 72.46 $ 70.86 $ 69.26 $ 67.67 $ 66.07 $ 64.47

96-gallon $ 106.38 $ 100.70 $ 95.02 $ 89.35 $ 83.67 $ 77.99

128-gallon $ 140.30 $ 131.55 $ 122.80 $ 114.06 $ 105.31 $ 96.56

Rate Increase Percentages FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Minican NA 25% 20% 17% 14% 12%

32-gallon NA 7% 7% 6% 6% 6%

64-gallon NA -2% -2% -2% -2% -2%

96-gallon NA -5% -6% -6% -6% -7%

128-gallon NA -6% -7% -7% -8% -8%

$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Year

Rate

Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon





FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Minican $ 20.52 $ 24.14 $ 27.77 $ 31.39 $ 35.02 $ 38.64 $ 42.27 $ 45.89

32-gallon $ 37.48 $ 39.41 $ 41.33 $ 43.26 $ 45.18 $ 47.11 $ 49.03 $ 50.96

64-gallon $ 72.46 $ 71.32 $ 70.18 $ 69.04 $ 67.89 $ 66.75 $ 65.61 $ 64.47

96-gallon $ 106.38 $ 102.32 $ 98.27 $ 94.21 $ 90.16 $ 86.10 $ 82.05 $ 77.99

128-gallon $ 140.30 $ 134.05 $ 127.80 $ 121.55 $ 115.31 $ 109.06 $ 102.81 $ 96.56

Rate Increase Percentages FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Minican NA 18% 15% 13% 12% 10% 9% 9%

32-gallon NA 5% 5% 5% 4% 4% 4% 4%

64-gallon NA -2% -2% -2% -2% -2% -2% -2%

96-gallon NA -4% -4% -4% -4% -4% -5% -5%

128-gallon NA -4% -5% -5% -5% -5% -6% -6%

$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012

FY 2013

FY 2014

FY 2015

FY

2016

FY

2017

FY

2018

FY

2019

Year

Rate Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon



Option 5: 7 Year Phase-in (eliminates sector imbalance in 3 years, and conservation

pricing in 7 years)


FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Minican $20.52 $25.94 $31.56 $37.34 $39.84 $42.07 $44.08 $45.89

32-gallon $37.48 $41.90 $46.32 $50.74 $50.81 $50.86 $50.91 $50.96

64-gallon $72.46 $75.32 $77.81 $80.00 $75.46 $71.40 $67.76 $64.47

96-gallon $106.38 $107.80 $108.49 $108.60 $99.64 $91.65 $84.47 $77.99

128-gallon $140.30 $141.12 $140.92 $139.87 $127.21 $115.89 $105.74 $96.56

Rate Increase Percentages FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Minican NA 26% 22% 18% 7% 6% 5% 4%

32-gallon NA 12% 11% 10% 0% 0% 0% 0%

64-gallon NA 4% 3% 3% -6% -5% -5% -5%

96-gallon NA 1% 1% 0% -8% -8% -8% -8%

128-gallon NA 1% 0% -1% -9% -9% -9% -9%

$0

$20

$40

$60

$80

$100

$120

$140

$160

FY 2012

FY 2013

FY 2014

FY 2015

FY

2016

FY

2017

FY

2018

FY

2019

Year

Rate Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon



Option 6: 3 Year Phase-in (eliminates sector imbalance with fixed percentage increases)


FY 2012 FY 2013 FY 2014 FY 2015

Minican $ 20.52 $ 22.71 $ 24.91 $ 27.10

32-gallon $ 37.48 $ 41.49 $ 45.49 $ 49.50

64-gallon $ 72.46 $ 80.21 $ 87.95 $ 95.70

96-gallon $ 106.38 $ 117.75 $ 129.13 $ 140.50

128-gallon $ 140.30 $ 155.30 $ 170.30 $ 185.30



32-gallon NA 11% 10% 9%

64-gallon NA 11% 10% 9%

96-gallon NA 11% 10% 9%

128-gallon NA 11% 10% 9%

$0 $20

$40

$60

$80

$100 $120 $140 $160 $180 $200

FY 2012 FY 2013 FY 2014 FY 2015

Year

Rate

Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon



Option 7: 3 Year Phase-in (eliminates sector imbalance with flat increases to rates)


FY 2012 FY 2013 FY 2014 FY 2015

Minican $ 20.52 $ 24.63 $ 28.74 $ 32.85

32-gallon $ 37.48 $ 41.59 $ 45.70 $ 49.81

64-gallon $ 72.46 $ 76.57 $ 80.68 $ 84.79

96-gallon $ 106.38 $ 110.49 $ 114.60 $ 118.71

128-gallon $ 140.30 $ 144.41 $ 148.52 $ 152.63



32-gallon NA 11% 10% 9%

64-gallon NA 6% 5% 5%

96-gallon NA 4% 4% 4%

128-gallon NA 3% 3% 3%

$0 $20

$40

$60

$80

$100 $120 $140 $160 $180

FY 2012 FY 2013 FY 2014 FY 2015

Year

Rate

Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon



Option 8: 3 Year Phase-in (eliminates sector imbalance with combination of fixed

percentage and flat increases to rates)


FY 2012 FY 2013 FY 2014 FY 2015

Minican $ 20.52 $ 23.69 $ 26.86 $ 30.08

32-gallon $ 37.48 $ 41.54 $ 45.60 $ 49.66

64-gallon $ 72.46 $ 78.36 $ 84.24 $ 90.05

96-gallon $ 106.38 $ 114.06 $ 121.71 $ 129.22

128-gallon $ 140.30 $ 149.76 $ 159.19 $ 168.38



32-gallon NA 11% 10% 9%

64-gallon NA 8% 8% 7%

96-gallon NA 7% 7% 6%

128-gallon NA 7% 6% 6%

$0 $20

$40

$60

$80

$100 $120 $140 $160 $180

FY 2012 FY 2013 FY 2014 FY 2015

Year

Rate

Minican

32‐gallon

64‐gallon

96‐gallon

128‐gallon

Documents

City of Palo Alto (CA) Staff Report: Refuse Cost of Service Study (2012)