Resolution No. 01-54A CITY OF TIGARD,OREGON AA
RESOLUTION NO.01-�A–
A RESOLUTION OF THE TIGARD CITY COUNCIL FORMALIZING COUNCIL POLICIES
AFFECTING SOLID WASTE RATE ACTIONS AND RESCINDING RESOLUTION NO.96-03
WHEREAS,the Tigard City Council desires to manage solid waste rates in a manner which is consistent
with the Solid Waste Management Ordinance(TMC 11.04);and
WHEREAS,the Solid Waste Industry and recycling programs and markets continue to rapidly change;and
WHEREAS,the Solid Waste Industry is being forced to change by multiple court challenges region-wide
which question continuing the past rate practice of commercial rates subsidizing the residential service
rates;and
WHEREAS,the Tigard City Council wishes to update its established policies for solid waste management
to insure rates that are just,fair,reasonable and adequate to provide ongoing necessary service to the public;
and
WHEREAS,the Tigard City Council desires to rescind Resolution No.96-03 and adopt updated policies to
meet the challenges faced in providing solid waste services for the citizens of Tigard.
NOW,THEREFORE,BE IT RESOLVED by the Tigard City Council that:
SECTION 1: The Tigard City Colmcil hereby rescinds Resolution No.96-03 in its entirety.
SECTION 2: The Tigard City Council will use the following policy when it reviews any changes to
the solid waste rates in an effort to reduce the commercial subsidy of residential service
rates and move to rates that are based on cost of service over a period of time:
SERVICE—TYPE RATE SUBSIDY POLICY
It is the desire of the Tigard City Council to eventually have solid waste rates be
profitable by each service type(i.e.,cart,container, drop box). Since there currently
exists a commercial(container)subsidy of the residential(cart)rates and drop box rates,
a phased-in reduction of the subsidy is anticipated within the next seven years. The
subsidy will be reduced at increments acceptable to the City Council.
SECTION 3: The Finance Director, or designee,will use the following policy when computing the
solid waste haulers'rate of return:
IOPERATING NVIARGIN/RATE OF RETURN POLICY
The Operating Margin,or rate of return,will be calculated on the before tax net profit as
I a percentage of gross revenue. The"profit rate"review will be based on the aggregate
pre-tax net income as a percentage of the aggregate gross revenues of the franchised
haulers. The City Council shall consider an adjustment during rate review proceedings
to provide a ten percent(10%)margin in the aggregate.
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SECTION 4: ANNUAL HAULERS'FINANCIAL REPORT REVIEW PROCEDURE
The Finance Director,or designee,will review the solid waste haulers' annual financial
reports and gather any clarifications deemed necessary from the haulers or their
designated representatives each year. After being satisfied that the reports are complete
and properly filled out in accordance with the instructions provided, the Finance
Director, or designee, will determine the "profit rate" by the aggregate pre-tax net
income of the haulers as a percentage of aggregate gross revenues.
The Finance Director,or designee,will then report the results to the City Manager,the
Mayor and City Council. If the aggregate profit rate falls below eight percent(81/o)the
City Council shall consider an adjustment to provide a ten percent(101,46)n_argin. If the
aggregate profit rate exceeds twelve percent(120/6),the City Council shall consider an
adjustment downward to provide a ten percent(10%)margin.
EFFECTIVE DATE:This resolution will be effective on and after October 1,2001.
PASSED: This day 200 2001.
For-4tity o T'
ATTEST:
City Recorder-City of Tig
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