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Home My WebLink AboutEDCO Disposal Corporation - Rate Adjustment - Increase - 1981The REQUEST of EDCO DISPOSAL CORP. for approval of rate increase (County of San Diego is increasing their disposal fees 40% at all landfills commencing July 1, 1981; Edco is requesting an increase of 400 per month, with an additional 350 per month adjustment for the 1- increase in operating costs; this represents a 14.7% increase) was presented. Discussion. EDWARD BURR, President, Edco, 6670 Federal Blvd., Lemon Grove, was present and said the last increase (July, 1980) was 350. Moved by Van Deventer, seconded by Camacho, the request be approved. Carried by unanimous vote. .0 66227 G i6-8/ , City of National City 1243 National Avenue National City, Calif. 92050 .. • -".- a *.'T- a Lemon Grove, California 92045 (714) 287-7555 Attention: Mr. Thomas McCabe - City Manager June 4, 1981 Honorable Mayor and Members of the City Council: Please accept this letter as our application and request that you approve the attached rate schedule for the collection of resi- dential and commercial refuse from within the City of National City effective July 1, 1981. The County of San Diego is increasing the disposal fees 40% at all landfills commencing July 1, 1981. It is estimated that this will require at least a $.40 per month increase in the residential rate for each single family dwelling in the city. We are requesting a further $.35 (6.7%) per month adjustment for the increase in our operating costs, which will amount to a combined increase of $.75 per month (14.7%) for residential rates and approximately the same percentage for commercial charges. The last adjustment in July, 1980 was to compensate for yet another disposal fee rise at that time; however, there has not been an increase in the rate to cover our escalating costs since October 1, 1979 while the consumer price index will have gone up more than 20% in this same 21 month period making the proposed 6.7% raise small in comparison. Enclosed you will find various documents supporting these requests. We will, of course furnish any additional information council or staff may desire. Thank you for your kind consideration of this proposal. Very truly yours, EDC DISPOSAL CORPORATION atiutf-t__) Edward Burr - President PROPOSED RATE SCHEDULE 7-1-81 RUBBISH AND GARBAGE 1. Residential Per month residential single family properties For the second and for each additional residential unit in multiple dwellings which do not exceed four units 2. Trailer Parks and Motels ($5.00 minimum) Ome time per week, per unit, per month 3. Apartment Houses (No minimum) One time per week, per unit, per month EXISTING PROPOSED MONTHLY MONTHLY RATE RATE $ 5.10 $ 5.85 3.85 4.40 3.60 4.15 3.60 4.15 SCHEDULE "A" PROPOSED RATE SCHEDULE 7-1-81 B. RUBBISH AND GARBAGE (COMMERCIAL AND INDUSTRIAL ESTABLISHMENTS) Up to (2) 40 gallon containers. One time per week Up to (2) 40 gallon containers Two times per week Up to (2) 40 gallon containers Three times per week Up to (2) 40 gallon containers Four times per week Up to (2) 40 gallon containers Daily (six days/Monday thru Saturday) Additional or unusual accumulation of rubbish Per Month Per Month Per Month Per Month EXISTING MONTHLY RATE $ 5.40 8.60 11.10 13.70 Per Month. 17.80 SCHEDULE "A" PROPOSED MONTHLY RATE $ 6.20 9.90 12.75 15.75 20.50 3.25 per cubic 3.75 per cubic yard yard PROPOSED RATE SCHEDULE •?-/-8/ D. BOX TYPE REFUSE.SERYICE DOER COLLECTION TARDS PER EXISTING PROPOSED BINS FREQUENCY M NT1 RATE W)NTHLY RATE 1 1 .13 29.75 34.25 1 2 26 47.75 55.00 1 3 39 66.00 75.75 1 4 52 84.00 96.50 1 5 65 102.00 117.25 1 6 78 124.50 138.00 1 • 7 91 153.50 171.25 2 1 26 60.50 69.50 2 2 52 96.75 111.25 2 3 78 132.25 152.00 2 4 104 168.00 193.25 2 5 130 195.00 224.25 2 6 156 221.75 255.00 2 7 182 260.50 299.50 3 1 39 88.25 101.50 3 2 78 137.75 158.50 3 3 117 193.75 222.75 3 4 156 222.00 255.25 3 5 195 287.75 330.00 3 •6 234 345.50 397.25 3 7 273 426.00 490.00 4 1 52 108.00 124.20 4 2 104 178.75 205.50 4 3 156 244.50 281.00 4 4 208 308.25 354.50 4 5 260 369.25 424.50 4 6 312 416.00 478.50 4 7 364 547.75 630.00 5 1 65 , 128.50 147.75 5 2 130 219.50 252.50 5 3 195 292.75 336.75 5 4 260 365.50 420.25 5 5 325 439.00 504.75 5 6 390 529.75 609.25 5 7 455 649.75 747.25 6 1 78 148.75 171.00 6 2 156 255.00 293.25 6 3 234 357.00 410.50 6 4 312 404.00 464.50 6 5 390 489.25 _ 562.50 6 6 468 595.25 684.50 6 7 546 732.00 841.75 SCHEDULE "A" EDCO DISPOSAL CORPORATION NATIONAL CITY COMPARISON OF COST OF OPERATIONS INDEX Seven Months Ended Projected December, 1980 1981 O, p/ Salaries - Route 10.9 11.8 - Mechanics and Yard 6.9 7.4 - Supervisors 4.7 5.1 - Office 1.8 1.9 TOTAL SALARIES 24.3 26.2 Health Insurance 1.5 1.6 Payroll Taxes 1.4 1.5 Uniforms .3 .3 Insurance - Workers Comp. 3.1 3.4 Safety Incentive - - 30.6 33.0 Gas and Oil 5.6 6.7 Insurance - Liability 2.4 2.9 Licenses and Highway Use Tax .9 1.0 Maintenance 8.5 10.3 Tires 1.5 1.7 18.9 22.6 Accounting and Legal 1.1 1.2 Customer's Claims .3 .4 Data Processing 1.4 1.4 Office Expense 1.4 1.5 Taxes and Licenses .4 .5 Telephone .4 .5 Utilities .4 .4 5.4 5.9 Dumping 12.8 18.0 TOTAL 67.7 79.5 INCREASE IS 17.4% MARSHALL A. PETERS AN ACCOUNTANCY CORPORATION 4676 ADMIRALTY WAY, SUITE 730 MARINA DEL REY, CALIFORNIA 90291 (213) 821-1400 May 18, 1981 BOARD OF DIRECTORS EDCO DISPOSAL SERVICE, INC. Gentlemen: MEMBER AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS CALIFORNIA SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS Pursuant to your instructions, we have reviewed the cost of doing business for your operating division, NATIONAL CITY RUBBISH SERVICE, which operates under contract with the City of National City. We recommend that the rates be increased 17.4%. This adjustment, when ap- plied to the residential rates, results in an 89C increase per month. We have compared this adjustment with the inflation factor, namely the Con- sumer Price Index, for the period from October 1, 1979 and projected to the mid -point of 1981 (or July 1, 1981) for a total period of 22 months. During this period, the Cost of Living Index will have increased approxi- mately 27.0%. Our study was based upon the financial data of the company's operating division books and records and certain cost data furnished by management. Costs have been projected generally based upon the company's recent ex- perience of the effects of inflation. Because this study is based upon partially the company's operating divi- sion records and have been projected to reflect inflationary increases, so as to reflect expected future costs, we are not in a position to render an accountant's opinion on this study as promulgated by Rule 58 of the California State Board of Accountancy. Sincerely, MARSHALL A. PETERS Certified Public Accountant /L SCHEDULE "B" EDCO DISPOSAL CORPORATION NATIONAL CITY COMPARISON OF CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS SAN DIEGO METROPOLITAN AREA ALL ITEMS CONSUMER PRICE INDEX AVERAGE FOR SEVEN MONTHS ENDED DECEMBER 31, 1980 of Increase Over 1979 1980 1981 1979 1980 January 214.8 254.0 287.7 34.0 13.3 March 221.4 258.3 293.1 32.4 13.5 May 228.3 267.9 297.5 (projected) 30.3 11.0 July 269.9 302.0 I.11.9 September 240.4 271.8 306.5 u27.5 12.8 November 247.8 279.1 311.1 25.5 11.5 EDCO DISPOSAL CORPORATION NATIONAL CITY ASSUMPTIONS 1) The operating data used as a base for this study is the cost of operations for the seven months ended Decem- ber 31, 1980 2) The operating data was projected for 1981 byadjusting the operating data base as follows: Payroll Expenses Equipment Operating Expenses Fixed Equipment Expense Other Direct Expenses Administrative Expenses Dumping 8.0 19.4'% 5.0':: 13.6% 8.0% 40.0%% The weighted average percentage increase for all operating cost excluding dumping is 12.2%. EDCO DISPOSAL CORPORATION SELECTED OPERATING COSTS AND INDEXES COST COMPONENT ITEM 1980-81 1979 % CHANGE Labor Salary - daily earnings 55.45 48.65 14.0 Fuel Diesel cost per gallon 96.2 66.2 45.3 Truck Replacement Producer Price Index (code 1411.02) 249.9 211.2 18.3 Truck Maintenance Consumer Price Index - auto parts & equipment 130.6 111.2 17.4 Container Replacement Producer Price Index - fabricated structrual products (code 10-7) 279.9 216.0 29.6 Tires New tires (average each) 355.00 303.00 17.2 Re -Cap (average each) 120.00 110.00 9.1 Disposal Sites All Other San Diego County - Residential per load Commercial per load Consumer Price Index - A11 Urban Consumer - All items SCHEDULE "C" 51.00 36.75 64.00 46.00 268.5 38.8 39.1 228.3 17.6 ANALYSIS OF DUMPING COST INCREASE Qesidential Increase ..ommercial Increase RESIDENTIAL #1 Analysis 240 loads per month x14.25 = divided by 10,142 add: Franchise fee (2%) Cost of bad debt, bonds, administration TOTAL #2 Analysis 150 residences service per load 14.25 divided by 150 = .095 x 4 1/3 weeks = cOMMERCIAL 236 loads per month x 18.00 = 35400 cubic yards collected per month 4248.00 divided by 35400 = x 4 1/3 weeks = x 3 cubic yard per bin = SCHEDULE "D" 14.25 per load 18.00 per load 3,420.00 .337 per res. .013 (15%) .051 .401 per res. .095 .412 per res. 4,248.00 .12 per yard .52 per month 1.56 per empty 8.0% increase CITY COMPARATIVE ANALYSIS OF RESIDENTIAL RATES IN SAN DIEGO JULY 1, 1980 JULY 1, 1981 RATE RATE Chula Vista $ 5.00 Under Review El Cajon 5.10 5.95 Encinitas 5.45 Under Review Fallbrook 6.60 7.50 La Mesa 4.88 5.70 Lemon Grove 4.88 5.70 National City 5.10 5.85 ( Proposed ) San Marcos 6.25 6.60 ( Proposed ) Spring Valley 5.75 6.50 Vista 6.05 6.40 SCHEDULE "E" ITEM #9 CONTENTS COVER LETTER A - PROPOSED RATE SCHEDULE B - ACCOUNTANTS REPORT C - OPERATING COSTS AND INDEXES D - DISPOSAL COST ANALYSIS E - COMPARATIVE ANALYSIS OF RESIDENTIAL RATES