CalMet raises fees for trash service

DOWNEY - The City Council Tuesday approved the new rate schedule submitted by CalMet Services of Downey for solid waste collection and recycling services to the city's residential and commercial customers effective April 1.The genesis of the rate adjustment goes back to Sept. 13, 2005 when the city and CalMet signed its 'Solid Waste Handling Services' agreement which took effect on Jan. 1, 2006. It called for a seven-year contract, set to expire on March 31, 2013. In the meantime, on March 24, 2009, according to director of public works director John Oskoui, the City Council approved what is known as the first amendment to the agreement, which set a new procedure for future rate adjustments (the contractor may apply for a rate adjustment once a year), extended the said agreement's term to March 31, 2016, and required a one-time cost of service rate study to be performed in mid-2012. The 2013 rates were to be based on such study. According to the provisions set forth in this first amendment, CalMet thus requested a rate increase for the period April 1, 2012 to March 31, 2013, as follows: for single family residential (SFR) and multi-family residential (MFR-2-4 units), an increase of 4.13 percent; for MFC (multi-family-5 units and more) and COM (business commercial) services, the increase asked for was 3.85 percent. Calculation of the rate adjustment was the formula using a weighted factor basis as provided in the first amendment, along with the following variables: labor rates, Bureau of Labor Statistics' Producer Price Index for fuel costs, disposal costs, and the BLS Consumer Price Index, with fuel costs contributing the most to the increase. This has all been granted. As mentioned, just to take a particular case, MFC and COM services will increase by 3.85 percent and, for an example, the new monthly cost for a MFC, 3 cubic-yard bin, serviced once a week for trash, will increase from $101.86 per month to $103.36 per month, and a bin of the same size serviced once a week for COM customers, will increase from $111.36 to $113.01 per month. All rates for temporary services will also increase by 3.85 percent. The new rates shall remain in effect through March 31, 2013. The City Council has also approved the second amendment to the 2005 agreement. It deals with such changes as the city transferring the responsibility for performing the billing function in relation to SFR and MFR accounts on behalf of CalMet (the city used to charge a 'per bill' fee to CalMet for doing the service). CalMet will now assume the responsibility for such billing function and for collecting the solid waste collection and recycling charges for these SFR and MFR accounts. Based on the stipulated requirements and guidelines outlined in the second amendment to the agreement, the contractor (CalMet) will henceforth be responsible for all fees associated with such billing. Also, the contractor shall pay to the city each month an amount equal to the franchise fee of five (5) percent of the gross revenues, as collected by the contractor from SFR and MFR clients. One related effect of all this change is the city will no longer receive CalMet's yearly compensation of approximately $74,000 for providing the billing service on their behalf. But it will be compensated for by the elimination of time-consuming details (e.g., the responsibility for determining and maintaining the service recipient's name, service address, billing address, and all other pertinent customer account data, and so on). CalMet has been performing solid waste collection and recycling services for Southern California residents and businesses for over 35 years.

********** Published: March 29, 2012 - Volume 10 - Issue 50