GREAT WESTERN RECLAMATION, INC.1976

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[ _ —--— TrashContract Page 5 For budgeting purposes, the proposed net additional total cost to the City each fiscal year would be as follows : ESTIMATED ADDITIONAL FISCAL YEAR - COST TO CITY 11/1/75-6/30/76 $ 43 ,300 7/1/76-6/30/77 73 , 000 7/1/77-6/30/78 82,000 7/1/78-6/30/79 89 ,600 - 7/1/79-6/30/80 96 ,700 7/1/80-6/30/81 103 ,500 7/1/81-10/31/81 35,300 TOTAL $523,400 1 In the Great Western Reclamation, Inc. letter of November 25, 1975 the last paragraph states as follows : Certain confidential records supporting Great Western Reclama- tions proposed rate adjustment are available to the Mayor and City Council for review upon request. It is unclear as to what is meant by the word "certain" as used in the above paragraph. Great Western Reclamation has been informed by the staff that the information needed includes a certified audit report with financial statements showing 1) capital investment of Great Western Reclamation, Inc. ; 2) profit and loss statements; and 3) corporate tax returns for the years 1970-75. This financial information is required before staff can recommend a supple- mental monthly rate increase because the original intent of the CPI adjust- ment was to cover inflation. Furthermore, it would seem that it would be in the best interest of the Mayor and the City Council if these financial records were made available to the City of Santa Ana Finance Department and the Certified Public Accounting firm hired by the City as its auditor to review the financial data. This financial information would receive the same confidentiality as current sales records of Santa Ana firms . An equitable procedure for a supplemental increase in residential rates similar to that for commercial bin rates could be established (reference commentary on amendment #6 above) . 10. The contractor has requested a two year extension of the currentcontract from October 31 , 1978 to October 31 , 1980. It is understandable that the contractor desires a longer contract period over which to amortize his equipment (IRS apparently requires a minimum of 5 years for tax purposes) , and in which to plan more capital expenditures for equipment and plant. A modern trash compactor truck costs approximately $45, 000, and it requires approximately 18 of these to service Santa Ana 's residential population. The staff' s report of December 31 , 1975 regarding the request for extension of contract period by refuse collection contractor, Great Western Reclam- ation, Inc. contains the following rationale as to why the contract should be extended. The low level of customer complaints and a general appraisal of the con- tractor' s performance indicate that the quality of service performed by the contractor is high. Great Western Reclamation has provided this service since 1963 and has performed exceptionally well even during two periods of labor crisis and one of serious fuel shortage. We have compared Santa Ana 's costs and complaints with the seven largest cities in Orange County. There is an average cost to the single-family residence of $1. 77 per month compared to Santa Ana ' s cost of $2. 00 per month. Complaint levels run from 28 - 66 per month compared to Santa Ana' s of 70 - 90 per month. On a per capita cost basis, the average is $0.49 per month and Santa Ana' s is $0.40 .