pages: CityCouncil/2021-05-04.pdf, 21
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CityCouncil | 2021-05-04 | 21 | and Processing of Alameda's Municipal Solid Waste, Recycling, and Organic Materials for a Twelve-Year Period (Ending June 30, 2033), with the Option of Two Four-Year Extensions; and (21-309 A) Introduction of Ordinance Approving the Franchise Agreement Between the City of Alameda and Alameda County Industries AR, Inc. Introduced. Rob Hilton, HF&F, gave a Power Point presentation. Councilmember Herrera Spencer inquired why the contract was not put out for bid. The Assistant City Manager responded discussion with Council began in early 2020, which yielded a sole-source effort; Alameda County Industries (ACI) showed high customer satisfaction within the community; Council direction indicated the relationship to the City was good; other communities going out with a competitive bid procurement process were experiencing responses with much higher rate increases; if the process had not worked out, the City would have gone out to bid; the City made good progress with ACI and continued the process. In response to Councilmember Herrera Spencer inquiry about the maximum amount allowable under the contract per year, the Assistant City Manager stated staff capped the percentage at 5%; the agreement limits the potential for significant rate increases in any given year; the amounts proposed in the agreement are 3% for the current year and a maximum of 5% for other years. Councilmember Herrera Spencer inquired whether the contract has a formula that explains how the percentage increase will be calculated, to which the Assistant City Manager responded in the affirmative. Mr. Hilton stated the formula is within Exhibit E to the agreement and shows roughly 25 to 30 pages of compensation formulas; the first set shown in Exhibit E-1 looks at an index- based methodology for fuel, labor costs and general inflation; the exhibit shows tonnages delivered to facilities and actual revenues with reconciliation based on inflation and performance factors; there are cost reviews every fourth year of the agreement, which performs a detailed review of the companies' books to look at and reconcile expenses and revenues ensuring customers are not overpaying for services and that the company is not over-profitable; there is a stipulated profit-margin not to be exceeded. Councilmember Herrera Spencer inquired whether there is public information. Mr. Hilton responded a rate application is submitted; stated the City has due diligence over the rate application; anything considered within the process becomes public information. Councilmember Herrera Spencer inquired the profit for the previous year. Mr. Hilton responded the 2020 books were not audited; stated the audit is currently in process; in prior years, profitability has been around $1.2 to 1.3 million. Regular Meeting Alameda City Council 19 May 4, 2021 | CityCouncil/2021-05-04.pdf |