RES 221299 - Laserfiche WebLink

City of Pleasanton Exhibit H: Index-Based Rate Adjustment Mechanism Franchise Agreement with Pleasanton Garbage Service City of Pleasanton Page H-1 June 7, 2022 EXHIBIT H INDEX-BASED RATE ADJUSTMENT MECHANISM 1. PURPOSE The purpose of this attachment is to describe and illustrate the method by which the City will calculate the annual adjustment to Rates based on the proposed Total Costs for Rate Period One adjusted to reflect changes in various cost indices and changes to Disposal and Processing Costs based on Tonnages of materials Collected. This index-based adjustment process will be used to determine Rates for all Rate Periods beginning with Rate Period Two (July 1, 2019 through June 30, 2020) with the exception that the Rate adjustment process for Rate Period Seven shall involve a detailed review of actual costs pursuant to Section 8.2 of the Agreement and Exhibit I. The index-based adjustment involves application of indices to various costs that comprise the Total Proposed Annual Costs for Rate Period One (and to Total Calculated Costs for future Rate Periods) to determine the Total Calculated Costs for the coming Rate Period. In addition, Disposal and Processing costs will be adjusted to reflect actual Tonnage Collected during the most-recently completed 12-month period. The difference (measured as a percentage) between the Total Calculated Costs for the coming Rate Period and the Total Calculated Costs for the then-current Rate Period is the Rate Adjustment Factor. The Rate Adjustment Factor is applied to the current Rates to determine the Rates for the coming Rate Period. 2. DEFINITIONS In addition to the terms defined in Article 1, the following terms are defined for the purposes of Exhibit H and Exhibit I only. A. “Annual Percentage Change” means (1) the annual percentage change in any of the indices defined above calculated as described in the following paragraph. The Annual Percentage Change in an index is calculated as the Average Index Value for the 12- month period ending in October of the then-current Rate Period minus the Average Index Value for the 12-month period ending October of the most-recently completed Rate Period and dividing the result by the Average Index Value for the 12-month period ending in October of the most recently completed Rate Period. For example, if the City is calculating the Total Calculated Costs in January 2020 to be effective for Rate Period Three (July 2020 through June 2021), the Annual Percentage Change for the CPI-U would be calculated as follows: [ (Average CPI-U for November 2018 through October 2019) minus (Average CPI-U for November 2017 through October 2018) ] divided by (Average CPI-U for November 2017 through October 2018) The calculated Annual Percentage Change shall be carried to three places to the right of the decimal and rounded to the nearest thousandths.