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Published on 09/23/1996 All articles from this issue

Los Altos Hills reduces trash fees - garbage firm seeks mediation

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By Clyde Noel / Town Crier Staff Writer

After two closed door meetings by the Los Altos Hills City Council last Wednesday, the council unanimously reduced the rate for solid waste and recyclable collection service to $23.75 per can, with an additional charge of $5 per 100 feet of driveway over the first 100 feet.

The Los Altos Garbage Company (LAGCo), who wanted a 2.95 percent rate increase, is protesting the rate decrease.

"We have tried to do our best and work with the staff," said Jon Angin, general manager of LAGCo. "Our expenses are higher than the town proposes and the only good thing is to go to mediation and come up with something for more than one year."

Todd Thompson, legal counsel for LAGCo, said, "Mediation is a way for the town to get together with a third party to work out our differences. Under the contract we have with the town, if the town believes the contract is not complied with, it is our right to go to a third party and work out something."

Councilwoman Elayne Dauber told LAGCo management, "If we had normal rates right now I could see it. But our rates are higher than normal rates and you haven't convinced me you want to settle now."

At the Sept. 4 council meeting, the town staff recommended rates for 1996-1997 that used an allowable expense ratio for LAGCo operations in Los Altos Hills of $739,793. LAGCo presented an allowable expense amount using the same methodology for setting rates in the franchise agreement totaling $815,252.

The items in dispute, according to a report by City Manager Jeff Peterson, are:

An increase in payroll and benefits due to adding seven employees to the LAGCo work force and a change in the health plan that costs LAGCo approximately 7 percent more;

What the LAH town staff considers an "unreasonable 'upsizing'" due to LAGCo recently losing one of their smaller accounts (Woodside) to a competitor;

An office rent increase for LAGCo of 66.15 percent, in anticipation of a move and consolidation of LAGCo's operations to a new facility in Mountain View scheduled to take place Dec. 1;

A jump in the cost of LAGCo supplies of 29.69 percent for the coming year and an increase in fuel oil costs; an increase in utilities and telephone of 105.23 percent.

An increase in the corporate management fee of 31.24 percent for various reasons listed in a letter dated Sept. 11; the staff recommends no more than 6 percent be allowed.

"We have a difference of opinion here and I feel we have been going through the mediation program," Mayor Sid Hubbard said. "I think we have had ample opportunity to come to a decision by this time. I will make a motion to implement the rate structure prepared by the staff. LAGCo has asked for mediation, and we agree with that procedure."

Starting Oct. 1 the new lower rates will be in effect. However, the rates are subject to mediation and may change.