This is an informational item on the rate adjustment process and deadlines for solid waste, organic waste and recycling.  No City Council action is required.

The City is party to franchise agreements with Allied Waste Services (dba Republic Services) and Tri-City Economic Development Corporation (Tri-CED) for solid waste, organic materials and recyclable materials collection and processing services.  In accordance with the agreements, both service providers submit annual applications requesting contractor’s compensation for the coming rate period.  The City reviews the applications for accuracy, examines the projected revenues and expenses and, if necessary, makes adjustments to the requests for compensation. Residential and commercial collection rates are set to generate sufficient revenue to compensate the two service providers. The purpose of the rate adjustment process is to ensure that the rates charged are appropriate and equitable.

 Recently, the City notified Republic Services and Tri-CED of the January 1, 2020 submittal date for compensation applications for the next rate period, Fiscal Year 2020-2021. The earlier than usual submittal date for indexed-based rate review applications is prompted by an adjustment to the annual rate adjustment process.

Union City property owners pay for solid waste collection services and a storm water fee through special assessments applied to a homeowner’s annual Secured Property Tax Statement. State law requires that certain procedures be followed with regard to “property-related” fee increases imposed by governmental agencies. Any local government imposing or increasing any property-related fee or charge must provide written notice to the affected property owner of record at least 45 days before a public hearing to consider adoption of the new rates by the City Council.

To ensure a thorough review and consideration of the contractor requests for compensation and to comply with the public noticing requirements for the upcoming solid waste rate adjustment, the City has prepared the following rate review schedule:

FY 2020-21 Rate Review Schedule

After Republic Services and Tri-CED submit the rate applications by January 1, 2020, staff will work with the City’s solid waste consultant, HF&H Consultants, and review the applications to verify the mathematical accuracy, reasonableness, and logical consistency of the assumptions supporting the service providers' projected revenues and expenses.

Review of the rate applications is anticipated to be completed by March 10.  Staff’s findings and recommendations regarding proposed rates for the upcoming rate period are to be presented at the March 24, 2020 meeting of the City Council. Upon Council approval, a notice will be sent to all Union City property owners to explaining the proposed maximum allowable solid waste collection rates. Mailing of the notice is planned for April 15, 2020. The noticing process is intended to provide rate payers advance notice and an opportunity to file a formal protest regarding the potential new solid waste rates.

A public hearing to consider a rate adjustment is required at least 45 days after the notice is received by the affected rate payers. Said hearing is proposed for the June 9, 2020 session of the City Council. At the end of the public hearing, Council could formally adopt fees for the next rate period if the City does not receive a majority protest. Majority protest exists if more than 50% of property owners in the City submit written protests regarding the rate adjustment. If a majority protest is received, the Council cannot increase the rates, and the rates will remain unchanged. If Council approves the new residential and commercial collection rates, they become effective July 1, 2020.  Refuse, recycling and storm water assessments for collection services during the upcoming rate year appear on Union City residential property tax bills mailed by the County tax collector in fall 2020.

The City Council is responsible for setting rates, but it’s the City’s rate payers, residential and commercial, who pay for the collection and disposal of garbage; collection and processing of recyclable items, yard waste, and food scraps; seasonal recycling programs; and public education activities to meet regulatory requirements. Collection rates are established to increase recycling and composting to meet state mandates and divert materials from disposal in the landfill. During the last decade, the community has consistently exceeded the goal of 75% waste diversion thanks primarily to the efforts and support of rate payers, the City and Republic Services and Tri-CED.

Some costs will be incurred  to prepare, print and mail a notice to all affected property. Funds are available in the Solid Waste Management Fund (Fund 2030). No General Fund monies will be used.