ITEM 9-D

City Council Meeting: June 9, 1992      Santa Monica, California

To:       Mayor and City Council

From:     City Staff

Subject:  Resolution Increasing  Solid  Waste  Fund  Charges  for
          Commercial/Industrial  Refuse  Customers  Using Private
          Refuse Hauler Services

INTRODUCTION

This report recommends that City  Council  approve  the  attached
resolution  to  implement  an  increase to the ancillary services
rate   differential   fee   that   the   City    charges    those
commercial/industrial   customers  using  private  refuse  hauler
services.  This rate  differential  includes  ancillary  services
provided  by  the  City  beyond  the  collection  and disposal of
commercial refuse including street sweeping, street corner litter
container  service,  and  hazardous  waste  stand-by and response
costs.

BACKGROUND

On April 1, 1992, the City of Santa Monica implemented a   refuse
rate  restructure program based on the volume of service to which
an  individual  residential  or  commercial/industrial   customer
subscribes.   An  integral part of this rate restructuring was to
allocate  cost-of-service  per  service  group   (single   family
residential,  multi-family,  commercial)  and  per  service  type
(refuse collection, recycling, street sweeping, litter  control).
The overall plan is to survey and allocate costs proportionately,
accurately, and fairly  to all segments who  benefit  from  these
City-provided ancillary services.

DISCUSSION

For many years, Santa Monica  Municipal  Code  has  provided  for
mandatory city-provided refuse service for all residential areas.
In commercial and industrial zoned areas, refuse service has been
open to either city-provided or private hauler service by several
companies.  However, the City Solid Waste Fund provides ancillary
services beyond refuse collection and disposal to all segments of
the community.  In light of this  fact,  Municipal  Code  Section
5227a has provided for a direct surcharge to be assessed to those
customers who subscribe to  private  refuse  hauler  service  for
provision  of  these ancillary services from which they  benefit.
City-provided refuse service customers  are  assessed  for  these
services as part of their overall refuse fee.  Analysis indicates
that the current  fee  of  $35.50  per  two-month  billing  cycle
charged to those commercial/industrial customers who subscribe to
a private refuse service does not cover those ancillary costs.

Using FY 92/93 budget figures, the  following  ancillary  expense
analysis   was   conducted  to  determine  the  revised  cost  of
operations allocation of these ancillary services as  they  apply
to the 2,279 commercial/industrial customers:

     1.  Street Sweeping/Litter Container Service:   50%  of  the
         street  sweeping/litter  ($1,237,753) is targeted to the
         commercial/industrial sector, which amounts to $618,877.
         This  amounts  to $45.26 per billing period (two months)
         per commercial/industrial customer.

     2.  HazMat Standby: HazMat Team stand-by for HazMat  expense
         budget  is $337,910.  Analysis indicated that $36,907 of
         this   total   cost   should   be   allocated   to   the
         commercial/industrial   sector.    Spreading  this  cost
         across the commercial/industrial customer  base  amounts
         to $2.69 per customer per billing period.

Based on  this  analysis,  staff  recommends  that  the  fee  for
ancillary  services  be  increased  by  $12.45.   As a result the
total revised rate is $47.95 per customer per billing period.

BUDGET/FINANCIAL IMPACT

It is anticipated that  the  $12.45  increase  per  customer  per
billing  period  will  provide  an  estimated  annual increase of
$94,271 in revenue account # 27-500-441-00000-0150-10000.

RECOMMENDATIONS:

Staff  recommends  that  the  City  Council  adopt  the  attached
Resolution  increasing the ancillary services rate charged to all
commercial refuse  customers  not  subscribing  to  City-provided
Solid Waste services from $35.50 to $47.95.

Prepared by:  Stanley E. Scholl, Director of General Services
              Tom Dever, Solid Waste Superintendent

attachment:  Resolution


                         RESOLUTION NO.
                      (CITY COUNCIL SERIES)

              A RESOLUTION OF THE CITY COUNCIL  OF
              THE  CITY  OF  SANTA MONICA REVISING
              FEE CHARGED FOR ADMINISTRATIVE/
              SPECIAL  SERVICES BY THE SOLID WASTE
              FUND TO THOSE COMMERCIAL  INDUSTRIAL
              CUSTOMERS   USING   PRIVATE   REFUSE
              SERVICES

              WHEREAS, Municipal Code Section 5227 allows monthly
fees   for   general  City  sanitation  services  to  be  set  by
resolution; and

              WHEREAS, Municipal Code Section 5227 allow fees  to
be   assessed   for   Administrative/Special  Services  to  those
commercial/industrial refuse customers  who  subscribe  to  other
than City-provided refuse service; and

              WHEREAS, a study has determined that this fee  must
be  revised  to  reflect  true cost-of-services and ensure refuse
rate equilibrium  vis-a-vis  City  and  private  hauler  provided
refuse service; and

              WHEREAS, the fees established  by  this  Resolution
are no more than necessary to recover the costs of these services
provided,

              NOW, THEREFORE, THE CITY COUNCIL  OF  THE  CITY  OF
SANTA MONICA DOES RESOLVE AS FOLLOWS:

              SECTION  1.   The  fee  for  Administrative/Special
Services   assessed   to  those  commercial/industrial  customers
subscribing to other than City-provided refuse service  shall  be
$47.95  (Forty Seven Dollars and Ninety Five Cents) per two month
billing cycle.

              SECTION 2.  The City Clerk  shall  certify  to  the
adoption  of  this Resolution, and thenceforth and thereafter the
same shall be in full force and effect.

APPROVED AS TO FORM:


ROBERT M. MYERS
City Attorney