Marin Franchisor’s Group – Rate Methodology Review

In 2017, R3 conducted a comprehensive rate methodology review for the Marin Franchisors’ Group (Group)—a coalition of jurisdictions including the Cities of Larkspur and San Rafael, the Town of Ross, the County of Marin, and Las Gallinas Valley Sanitary District. When the recycling market collapsed, the Group faced over $1.15 million in accumulated losses that threatened service stability across all member communities. We worked closely with the Group and their franchised hauler, Marin Sanitary Service, to develop a sustainable rate methodology that protected ratepayers while ensuring the continued viability of recycling programs. Our team simplified and streamlined the existing rate adjustment process, creating a clearer system that addressed both routine cost changes and extraordinary circumstances like recycling market fluctuations.

We developed new methodologies that fairly allocated recycling costs and revenues across different communities while addressing the challenge of commercial customers migrating to lower-cost service areas. By establishing performance metrics and tracking mechanisms, we gave the Group better tools to understand service outcomes and make data-driven decisions. We also revised the overall rate-setting process to achieve greater simplification and stability, making it easier for residents and businesses to understand how their rates were calculated. This included instituting formal succession planning to ensure continuity as leadership changed over time.

Since that initial engagement, R3 has been retained annually to provide ongoing rate review services for the Group. Each year, we conduct detailed cost-based rate analysis to ensure fees remain aligned with actual expenses and market conditions. For example, in 2018, we determined an overall rate increase of 9.58% was necessary to cover projected expenses and address the recycling market crisis, helping the Group make difficult but necessary adjustments to keep waste collection and recycling services financially sustainable. This annual partnership ensures the Group’s rate methodology remains responsive to changing conditions while protecting ratepayers from unnecessary increases. Our continued involvement helps these  communities maintain reliable waste services and meet California’s environmental goals without compromising fiscal responsibility.