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notice to the City. In addition, in the event that actual deliveries to the Disposal System exceed the Cumulative <br />Tonnage Target as of the end of any Contract Year, the City acknowledges the County shall have the right to <br />establish reserves intended to reflect the potential for lower than expected annual waste deliveries in subsequent <br />years, and that any such reserves shall constitute "Restricted Reserves". <br />(C) [RESERVED] <br />(D) Interim Use of Remedies. In the event that, during any Contract Year, waste deliveries to <br />the Disposal System are 25% or more below delivery projections for such Contract Year with the result that the <br />County determines it is unlikely that the Cumulative Tonnage Target will be achieved as of the end of such Contract <br />Year, the County may utilize the remedies described in Section 4.2(B) prior to the end of such Contract Year; <br />provided, however, that if at the end of such Contract Year, the Cumulative Tonnage Target is actually met, the <br />County shall reimburse any adjustments to the Contract Rate made pursuant to this Section to Participating Cities. <br />Such reimbursement may be given as a credit or adjustment to the Contract Rate for future deliveries, rather than a <br />lump sum payment. <br />(E) Special Charges. Notwithstanding Section 4.2(A), the County shall have the right to <br />impose special charges for the receipt of hard to handle materials, such as bulky materials, construction and <br />demolition debris, tree stumps and sludge. Such special charges shall be calculated to reflect the reasonable <br />incremental costs to the County of accepting such hard to handle materials. In addition, in the event that the Board <br />of Supervisors of the County makes a determination to implement a facility (including but not limited to a transfer <br />station, landfill, conversion technology facility, or a materials recovery or processing facility), which facility would <br />be intended to provide for disposal alternatives after the closure of one or more of the landfills currently operating <br />within the Disposal System, the County may impose an additional charge of $0.50 per ton of Acceptable Waste in <br />order to pay the costs of the study, development, planning, construction and/or operation of such facility. <br />Adjustments pursuant to this Section 4.2(E) shall not require compliance with the provisions of Section <br />4.2(I). <br />(F) Escalation. The Contract Rate shall be adjusted each July 1, beginning July 1, 2011. The <br />change will be equal to the positive percentage change in the Consumer Price Index -All Urban Consumers, U.S. <br />city average, All items, Not Seasonally Adjusted, Series ID CUUROOOOSAO ("CPI") as measured from the October <br />21 months prior to the rate adjustment to the October immediately preceding the rate adjustment. For example: The <br />July I, 2011 rate adjustment shall be based upon the index change from October 2009, to October 2010, referred to <br />as year 1 and year 2 respectively in the following example . <br />Formula to calculate percentage change in the Contract Rate: <br />Step 1: <br />October Year 2 CPI _ 1 = % increase in Contract Rate <br />October Year 1 CPI <br />Step 2: Current Contract Rate x (1+ % increase in Contract Rate) =Contract Rate as of July I Year 2 <br />On each April 1, commencing April 1, 2011, the County shall provide the City with notice of the <br />adjustment to the Contract Rate to be effective the following July 1. Such notice shall contain the calculation of the <br />adjustment set forth above. The County will calculate the new Contract Rate each year. <br />In the event that the change in the CPI is negative, no rate adjustment will be made for that year. No <br />adjustment under this Section 4.2(F) will take place until the October CPI index surpasses the index level as of the <br />October immediately preceding the last annual rate adjustment pursuant to this Section 4.1(F), which will be <br />considered "year 1" in calculating the change in the Contract Rate. <br />17 <br />Execution Copy <br />