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299 processing fee is money the City pays Xcel Energy to take their refuse derived fuel <br />300 and burn it for electricity. The real processing costs at the facility is in the low <br />301 $60/ton and the recycler is going from $58/ton to $75/ton for recyclables that have <br />302 revenue and have value and yet not explaining perhaps why they are increasing the <br />303 processing fee. To him, that huge increase in the processing fee really removes the <br />304 incentive for revenue sharing. He did not see supporting a revenue sharing plan <br />305 based on a $75/ton processing fee. <br />306 <br />307 Member Misra thought the processing fee seemed like a big jump and she was not <br />308 sure why. She indicated she would also support the shorter term for the contract. <br />309 To complicate things further, she wondered if the City has looked at the potential <br />310 for changes that might come about as a result of the Federal Infrastructure Bill <br />311 because there is a lot of pressure to include sustainability and some recycling <br />312 programs in that. That would also potentially speak at keeping the contract to a <br />313 shorter term. She recalled that their current recycler mentioned at a presentation a <br />314 few years ago that was when China first put the ban on taking their recyclables and <br />315 did reflect this period of costs going up, but they did way over time there would be <br />316 some stabilization and there would be more domestic markets for this. She <br />317 wondered if they are starting to see that now or if there has been any ability to take <br />318 alook atthe possibility. She wondered if the US is rounding the corner and creating <br />319 markets. <br />320 <br />321 Mr. Johnson indicated staff works pretty closely with Ramsey County because they <br />322 have someone that is watching the markets. The City sends Ramsey County its <br />323 revenue sharing data monthly so Ramsey County can compile it and look at it. The <br />324 most recent talks, staff knows that there is more processing coming up in the US. <br />325 He indicated no one knows for sure if the US is rounding the corner at this point <br />326 and, going forward, it looks really nice where the City sits right now. But when <br />327 they start looking at the additional processing fee on top of that, it does take away <br />328 a lot of the benefit. It is too early to tell where this is coming from. <br />329 <br />330 Vice Chair Ficek indicated on the base collection proposal, he was looking at the <br />331 differences between the vendor owned or City owned cart and as he thought about <br />332 it, if they are pushing that cost off to the City he would have thought the price would <br />333 have gone done as proposer one did but he saw proposer two, when the cart moved <br />334 to the City, there is a thirty-three cent add in but the base cost still went up even <br />335 though the proposer is pushing off that part to the City. He wondered if there was <br />336 any comment from staff on that difference. <br />337 <br />338 Mr. Johnson explained under most circumstances a vendor owned cart will be more <br />339 than a City owned cart, this happened with the last proposals as well where one <br />340 vendor had a cheaper vendor owned cart than a City owned cart. The City is kind <br />341 of at the situation again where staff is seeing the same couple of proposers and the <br />342 same scenario. There was not a lot of detail in the proposals that would have added <br />343 a lot more detail into that other than the pricing of it was passed onto the City within <br />344 their proposals themselves. <br />Page 8 of 10 <br />