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Rate Adjustment The recommended across the board rate adjustment of 5% is intended to address the following financial matters: . 2.21% - Overall cost of living adjustment to address ongoing operational costs subject to inflationary factors. . 0.43% - Tipping Fee increases for disposal of refuse at the Vasco Road landfill. • 0.94% - Wage adjustments realized from labor contracts. • 0.42% - Various costs including reimbursement for City consultant services to evaluate the PGS rate review. In addition to this adjustment, staff intends to have the $45,000 included in this report's recommendation added to the rate base and as a result, the funding for these recommended services will be passed through from ratepayers to the City. . 1% - Increase to the existing 1% City franchise fee (calculated as a percent of gross revenues). The 2% City franchise fee remains well below the average of approximately 8% to 10%. In addition to the above, Stopwaste.org/Alameda County Waste Management Authority has approved a Benchmark Information Service Fee ranging from $1.81 to $21.72 per year for all Alameda County refuse customers that will go into effect July 1, 2013. As a result, collection rates will be adjusted at that time to reflect this fee which will be a passed through to Stopwaste.org. The fees are not affiliated with the City or PGS. The impact of the above 5% rate increase varies based on the type of service received. A listing of the impact on the most common service levels is as follows: Recommended Monthly Service Rates Effective January 1, 2013 Service Type Current Rate Rate Increase New Rate 35-Gallon Service $29.13 $1.45 $30.58 96-Gallon Service $34.57 $1.73 $36.30 Cubic Yard - Commercial $25.86 $1.29 $27.15 A complete rate schedule is included as part of Attachment 1. As part of the current rate review process, NewPoint group surveyed communities to determine comparable rates. The results of these surveys, which are included as Attachment 2, show that the PGS rates are 11% above average for 35-gallon can service, 47% below average for 96-gallon rates and 19% to 24% above average for selected commercial bin rates. As indicated in the Recommendation, staff anticipates that PGS will amend its rate based to include the cost of NewPoint Group's project fees. In addition, through the rate negotiation process, staff anticipates that is will also include the full cost of the City's Page 5 of 6