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Based on the results of the audits, Staff is pleased to report that there are no findings <br />indicating discrepancies in the waste and recycling tonnage reports and/or in the <br />quarterly fees paid to the City for the calendar years 2015 and 2016. <br /> <br />The City has non-exclusive commercial agreements with seven waste haulers: California <br />Waste Services LLC, CalMet Services, Inc., EDCO Disposal Corporation, Universal <br />Waste Systems, Inc., West Coast Waste & Roll Off Service, Republic, and Waste <br />Management. These seven haulers are authorized to provide bins to business <br />customers for on-going business activities, and roll-off dumpsters to residential and <br />commercial customers for construction, demolition, cleanup, and remodeling activities. <br />Customers are able to choose from any of the City’s authorized commercial waste <br />haulers. The rates charged by the haulers for various services are competitive and are <br />set by the haulers, not by the City. <br /> <br />Under the terms of the Agreements, and in consideration for the right to offer their <br />services in the City, the franchised waste haulers are required to: <br /> <br />• Remit to the City a Franchise Fee equal to 5% of their gross receipts collected from <br />customers in the City. <br />• Remit to the City an AB 939 Fee equal to 5% of their gross receipts collected from <br />customers in the City. As a financial incentive to increase recycling, the hauler may <br />reduce its AB 939 fees by the same percent as its diversion rate. For example, if the <br />hauler diverts/recycles 10% of the waste it collects in the City, the AB 939 Fee for <br />that period is reduced by 10%.(e.g., they would pay 4.5% instead of 5%). <br />• Provide public outreach and education, and upon customer request, provide <br />collection of recyclables, green waste, or organics such that customers are able to <br />comply with State-mandated Mandatory Commercial Recycling (AB 341) and <br />Mandatory Commercial Organics Recycling (AB 1826). <br />• Submit to the City quarterly reports that include the amount of solid waste and <br />recycling tons collected in the City. <br />• Notify the City prior to any vehicle inspection performed by the California Highway <br />Patrol (CHP). <br /> <br />In addition to these requirements, the Agreements give the City the right to inspect/audit the <br />haulers records, and require the haulers to provide copies of any requested records at no <br />cost to the City. In October 2017, the City retained MSW Consultants (MSW) to conduct <br />performance audits on Waste Management and Republic for calendar years 2015 and <br />2016. MSW has audited over 40 waste haulers and have certified public accountant (CPA) <br />and experienced staff that are trained for such performance audits. Furthermore, in 2016 <br />MSW successfully completed performance audits of the City’s residential haulers, EDCO <br />Disposal Services and Universal Waste Systems, Inc. <br />Waste Management and Republic were selected for auditing because they have the <br />largest share of the commercial waste collection market in the City, representing 67% <br />(or ~$976,000) of the total annual reported commercial hauling market activity in the <br />City. As mentioned above, these audits were performed for transparency purposes and <br />2