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existed in 2002, i.e. we are only dealing with the higher cost of fuel since that time versus <br />a surcharge that would have imposed increases on our rates for fuel prices that were <br />much lower. It also appears we will be one of the first contracts with this surcharge. <br />This puts us at risk for additional costs if other contracts for other communities do not <br />include this provision. The haulers say they have implemented this surcharge on their <br />"open accounts ". However, we have talked with other haulers (outside of our contract) <br />who have not implemented such a charge. <br />➢ The contract receives all proceeds from the sale of recyclables and takes all risk <br />associated with their disposal. <br />➢ Insurance limits were increased. <br />➢ Televisions have been eliminated from Attachment B given the haulers are not allowed to <br />place them in the waste stream. <br />➢ Charges for collection, disposal, and recycling are increasing by 9.6% for a 30- gallon <br />service (11.28 vs. 10.29); 9.1% for a 60- gallon service (12.84 vs. 11.77); and 8.2% for a <br />90- gallon service (14.92 vs. 13.79) at the outset of this contract. This does not include <br />the fuel surcharge percentage that is on top of those numbers. (At $3.00 a gallon for <br />diesel, another 4.3% is added to the collection and recycling components.) While this is a <br />large increase, it is important to remember that we have had our rates frozen for the past <br />five years. (The only cost that could change was disposal costs associated with rate <br />changes, up or down, at the Refuse Derived Fuel processing facility; i.e. tipping fees.) It <br />is also important to note that our rates are fixed for a five -year term versus having <br />inflationary adjustments that exist in some other organized collection contracts. Even <br />with the fuel surcharge, we are less than the cost in Vadnais Heights (another multiple <br />hauler organized collection system — see last page of materials). We are higher than <br />North St. Paul, but they are a one - hauler city and the haulers claim that generates some <br />economy of scale savings to them. <br />The option for the City to bill for organized collection service remains, but the fee the fee <br />reduction for doing so has been increased by 10% given the increase in the overall <br />contract amounts. (See Exhibit A) <br />Lastly, we have included a rate comparison chart to show how we stack up after these <br />increases. You will see that we are lower than Vadnais, but higher than North St. Paul and <br />White Bear Lake. (They are both single hauler contracts.) We are also less than what Allied <br />Waste (BFI) and Waste Management charge on their open system accounts. However, <br />Veolia (Onyx) is quite a bit cheaper. Also, an employee who lives in Lino Lakes just signed <br />up with Walters Disposal on an open system. Her rate for a 90- gallon service is $14 per <br />month inclusive of single sort recycling and brush removal. She has these rates guaranteed <br />for two years and there is no fuel surcharge. <br />The Council will have to decide if they feel the rates we have negotiated are competitive <br />enough. The City Attorney will also be reviewing this Contract and will add his comments at <br />Wednesday's meeting. We will also report any last minute comments that the haulers may <br />have after reviewing this information. <br />cc: Haulers <br />2 <br />