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SECTION FOUR - WILLIAMSON COUNTY LANDFILL TRANSCRIPT FOR APPROVAL OF THE 2003 CONTRACT WITH WASTE MANAGEMENT, INC. (10/28/2003)
PITTMAN: Ok, there's one clause that we've added in Section 14, that says, at some point in the future, we decide to expand further, which we don't know where that would be to, then that expansion would be a negotiated deal as to who bought the land (inaudible), this expansion gives us up to a 50-year life. Uh, the main sections of the agreement--it adjusts the royalties. As the volumes increase, we start gettin' more royalties. Right now, up to 200,000 tons a year is seven-and-a-half percent, and every 50,000 it goes up after that is another quarter of a percent royalties (inaudible). It clarified the volume discounts for volume customers. It says Waste Managaement still pays full royalty fee based on posted gate rate if you want to get a discount by, and the county crews--county department--can see that same discount.
LIMMER: And we've got a minimum dollar amount in there also in c, in 4c and d ....
PITTMAN: The section we added which just says that if everything just goes south, if the royalty is less than 60,000 in two years (inaudible), then there's the option to ....
BOATRIGHT: Do you know what we're generating now?
LIMMER: I don't know what the total dollar is. David (Hays), do you ...?
PITTMAN: About 30,000 a month.
BOATRIGHT: About 30,000 a month, 360,000 ....
PITTMAN: So, it's just that, if all the business goes away, there is an option.
BOATRIGHT: And that's based on roughly 200,000 tons a year right now?
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NOTES
In addition to seeing the palty increase of one-quarter percent for each added volume of 50,000 tons, Pittman is also proud of the "hard-ball" negotiation which would give the county a minimum of $60,000 per year "if everything just goes south", a very remote prospect in a county with such phenomenal growth.
AND THE MOST MISLEADING statement in Pittman's statement about discount's, in which Waste Management "pays full royalty fee based on the posted gate rate" in the event haulers get discounts. This statement doesn't disclose the provision in the contract which allows related third-party transactions (such as Waste Management hauling for itself) can be discounted to ANY MINIMUM, and the county's royalties related to those revenues don't have to be "grossed up" to the posted gate rate. And, as of the first week in January of 2009, Williamson County apparently hasn't asked Waste Management (and doesn't know) just how low that non-grossed-up discount really is. Pittman says nothing about this issue.