Case Studies

Project Background

The Central Contra Costa Solid Waste Authority (RecycleSmart) is a joint powers authority consisting of six member agencies: Orinda, Moraga, Lafayette, Danville, Walnut Creek and Contra Costa County (Agencies). For over 17 years, HF&H has performed the annual review of RecycleSmart's haulers' rate adjustment application for the collection, transfer, transport, processing, diversion, and disposal services. Prior to February of 2015 RecycleSmart had agreements with 1) Valley Waste Management for the collection, processing, and marketing of recyclable materials and organic materials; and, 2) Allied Waste Systems, Inc. (Allied) for the collection and disposal of solid waste. Recently, HF&H assisted with the negotiation of a new franchise agreement between RecycleSmart and Allied (aka Republic Services). The annual rate adjustment is determined using one of two methodologies: (1) an index-based adjustment, where the hauler’s approved compensation from the prior year is adjusted by various CPI’s (i.e., Fuel Index for fuel costs, Urban Wage Earners for labor costs, etc.); or, (2) a cost-based adjustment, where the hauler’s compensation is calculated by forecasting future annual costs based on actual results from the most-recently completed rate period, reviewed and adjusted for non-allowable costs.

Project Results

• As a result of our cost-based review conducted in 2011, the combined haulers’ requested compensation of $36,935,000 was reduced to $34,333,000, saving rate payers, in subsequent index year reviews, approximately $2,602,000 per year until the expiration of the Franchise Agreements.
• A recent index-based review reduced the hauler’s requested compensation and associated fees by approximately $90,000.