14-084.04 Sunshine Recyclers: Solid Waste Disposal Rates 2018-2019 r
Cmokane
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Mark Calhoun,City Manager
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10210 E. Sprague Avenue ♦ Spokane Valley WA 99206
(509) 720-5000 ♦ Fax: (509) 720-5075 • cityhall@spokanevalley.org
October 25, 2018
Marc B.Torre
President
Sunshine Recyclers, Inc. dba Sunshine Disposal&Recycling
2405 North University Road
Spokane Valley,WA 99206
Re: 2018/19 Solid Waste Transfer, Transport, and Disposal Rates, Contract 14.084.04
effective December 1,2018
Dear Marc,
We would like to thank Sunshine Recyclers, Inc. ("Sunshine") for its solid waste transfer,
transport, and disposal services this past year. The first four years of the City of Spokane
Valley's (the "City") agreement with Sunshine (the "Agreement") for such services has been
successful for the City and our citizens and we look forward to our ongoing partnership.
2018/19 Rate Based on CPI
This letter is in regard to the rates for 2018/19 effective December 1, 2018. All capitalized
terms herein shall have the same meaning as set forth in the Agreement unless otherwise
defined. As you are aware, pursuant to Section 5.3 of the Agreement, Sunshine is entitled to
an automatic increase in the Service Fee and Organics Fee equal to:
90% of the percentage change in the average CPI for the 12 month period July 1
through June 30 of the calendar year the adjustment becomes effective as compared
to the CPI average for the preceding twelve month period and multiplying the result
by the then applicable Service Fee and Organics Fee.
The rate increase was originally effective December 1, 2015, and has and will occur each
December 1 thereafter. Pursuant to our discussions, we understand that this automatic
increase will result in an increase of 2.78% to the Service and Organics Fees, which would
result in increased rates as follows prior to the inclusion of the 3.6% refuse tax:
Service Fee: $99.26 per ton (from $96.57 per ton) + additional administrative fee
amount
Service Fee minimum: $16.40 (from$15.96)
Organics Fee: $53.94 per ton (from$52.48 per ton)
Organic Fee minimum: $10.78 (from $10.49)
Administrative Fee
Further, pursuant to Section 5.4, Sunshine is required to pay the City an annual
administrative fee of$125,000. This fee may be "added, as applicable, to the fees set forth
in Section 5.2, as adjusted, to make up the total tipping fees that [Sunshine] charges." The
additional rate shall be "based upon the annual projected tonnage of Acceptable Waste."
The City and Sunshine originally agreed upon an additional amount of$2.75 per ton to be
added to the rates to provide for the administrative fee, which was based upon an initial
estimate of 45,500 tons.
Administrative Fee Overage
During 2015 Sunshine collected 63,411 tons instead of collecting the estimated 45,500
tons. Based upon that amount, Sunshine collected approximately $49,380 more than the
$125,000 administrative fee owed to the City pursuant to the Agreement. The Agreement
does not specify how overages shall be accounted for. The City has utilized this overage in
2015 and subsequent years to buy down the Service Fee and Service Fee Minimum Rates
and the remaining balance after the year ending November 30, 2018 is complete is
projected to be $3,733. For the 2018/19 year, the projected tonnage is estimated to be
77,500 tons of waste. Based on the estimated tonnage, the City fee would be $1.61 per ton
to collect the full $125,000 administrative fee.
2018/19 Rates
We request that$37,200 of the administrative fee be applied to the Service Fee by reducing
the administrative fee collected to $1.13 per ton. We request that the Service Fee Minimum
charged for trips with an amount of waste up to and including 320 pounds be reduced from
$16.40 to $15.44. The City shall provide for the reduction by compensating Sunshine $0.96
per trip. Currently, we understand that you estimate 14,000 trips at the Service Fee
Minimum cost level,which would result in an estimated total of$13,440. The City shall pay
for the reduction from the $125,000 administrative fee revenue as part of its ongoing
management of its solid waste system. With such reduction, the rates for 2018/19 will be
as follows.
Service Fee: $99.26 per ton + $1.13 (administrative fee) = $100.39 per ton ($104.00
per ton including the 3.6% refuse tax)
Service Fee minimum: $15.44 ($16.00 including the 3.6% refuse tax) (up to 320
pounds per trip)
We request that the Organics Fee be assessed at their full amounts as follows.
Organics Fee: $53.94 per ton
Organics Fee minimum: $10.78
Refuse tax of 3.6% does not apply to yard waste.
The total administrative fee remitted to the City would be $78,093 ($125,000
administrative fee - $37,200 (Service Fee reduction) - $13,400 (Service Fee Minimum
reduction) + $3,733 (beginning balance).
These adjustments will go into effect in accordance with the Agreement as of December 1,
2018.
If you are in agreement with administrative fee rate, Service Fee and Service Fee minimum
as set forth herein, please sign below to acknowledge the receipt and concurrence to set the
rates as provided herein. Please return two copies to the City for execution. A fully
executed original copy evidencing the agreement between the City and Sunshine for the
new rates will be mailed to you for your files. This letter shall supplement the Agreement
solely as provided herein, but shall not otherwise amend or modify the Agreement and all
terms of the Agreement shall remain in full force and effect.
Very truly yours,
CITY OF SPOKANE VALLEY
C0-44144„-_
Mark Calhoun, City Manager
ATTEST: APPROVED AS TO FORM:
1/6
Christine Bainbridge, City Cl:r• Office of e City Attorney
ACCEPTED AND AGREED:
CONTRACTOR
SUNSHINE RECYCLERS,INC.
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