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WASTE MANAGEMENT <br />WASTE MANAGEMENT <br />607 N. Railroad Ave. <br />P.O. Box 940 <br />Ellensburg, WA 98926 <br />November 8, 2019 <br />Patti Johnson, Director <br />Kittitas County Solid Waste <br />925 Industrial Way <br />Ellensburg, WA 98926 <br />Subject: Extension of Agreement for Operations of Transfer Stations, Hauling and Disposal <br />of Municipal Solid Waste, Hauling of Inert, Demolition Waste, Hauling Processing and <br />Marketing of Recyclables <br />Dear Patti, <br />Thank you for talking with us to discuss extending our contract under mutually beneficial <br />terms. Waste Management welcomes the opportunity to continue our partnership with <br />Kittitas County. We understand the County's desire to extend the contract term to provide <br />leeway for the construction of the new transfer station. <br />The current contract's annual CPI escalator has not kept pace with the cost of providing <br />service to Kittitas County. From recycling, to transportation, to labor, our costs have <br />increased in excess of the annual price adjustment. With appropriate rate changes, we can <br />continue to provide the services desired. Specifically: <br />• Increase the Municipal Solid Waste Fee by 3%; <br />• Increase yard debris and CDL per ton rates by 20%; and <br />• Adjust recycling -related services to address the unprecedented changes in the <br />market, including the need for more expensive processing coupled with the <br />continued downward trend in commodity prices and market availability. <br />o Increase Transfer Station Recycle Drop Box Haul Fees by 20%. <br />o Establish a per ton recycling processing charge, based on the net difference <br />between the cost of processing and the commodity value, based on our <br />filings for SMaRT with the Washington Utilities and Transportation <br />Commission (WUTC) for third party validation. <br />$147.22 Processing Cost (base date: May 2019) <br />46.23 Q3 2019 Average Commodity Value <br />100.99 Per Ton Processing Charge (to be adjusted quarterly) <br />These changes will bring the contract to an appropriate compensation level for the services <br />provided. Moving forward, to avoid having the financial problems we face today, happen in <br />the future, we propose an annual flat rate adjustment of 3.5% for predictability. If you'd <br />