BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION


In the Matter of the Petition of LeMay d/b/a )  DOCKET TG-980977
Butler Cove, G-98 and Pacific Disposal G-97 )  DOCKET TG-980978
for a Deferred Accounting Mechanism for  
)                                       Residential 
Recycling                                                )         ORDER 
AUTHORIZING
           )                  CARRIERS                                 )      
TO INSTITUTE A DEFERRED     )      ACCOUNTING MECHANISM
    )                  FOR
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 
. )         RESIDENTIAL RECYCLING 



   On JuLY 17, 1998, LeMay Enterprises d/b/a Butler Cove, G-98 and Pacific 
Disposal, G-97  filed proposed tariff revisions with the Washington Utilities 
and Transportation Commission which sought to institute a deferred accounting 
mechanism for the curbside recyling programs in Dockets TG-980977 and 
TG-980978.  The companies are both under common ownership and control, and the 
proposed changes were proposed to become effective August 1, 1998, via LSN 
Request.

  In the past, recycle rates were the combined total costs of collection and 
processing less the estimated value of the commodities collected.  Under 
deferred accounting, the gross collection and processing rate will be 
separately stated and subject to normal docketing procedures whenever rate 
changes need to be made.  For the commodity value portion; however, at the 
beginning of the program and each year thereafter, an estimate will be made of 
the future revenue received from sales of commodities using an average of the 
three most recent months sales price and tonnage per commodity.  This amount 
will then be converted to a per customer per month basis, using a three month 
average number of customers, to be shown as a credit offset (if the commodities 
have value) or debit add-in (if the company must pay to have them taken away) 
to the gross collection rate for recycling service.  This credit/debit amount 
will be subject to annual review and adjustment based on the comparison of the 
amounts expected at the beginning of the period versus the amounts later 
actually realized.  Any difference will be reflected in the commodity 
adjustment for the next year.

  The following example, using the combined proforma results of recycling and 
customers for Butler Cove and Pacific explains the process: 

Rates effective August 1, 1998:

  Projected Commodity Revenue $288,800
       (12 months beginning 8/1/98)
   
  Number of customers       29,658
  
  
  Gross Recycle Rate:      $2.81
  less: Commodity credit       (0.81)
       ($288,800/12/29,658)

  Net amount billed to customers           2.00
       (Beginning Aug 1, 1998)


Calculation of Rate for the Year October 1, 1999 to September 30, 2000:


  Actual Commodity Revenue   $300,000
       (12 mo. ended 7/31/99)

  Earlier Projected Commodity Revenue  $288,800
       (12 mo. ended 7/31/99)

  Amount Due (To)/From Customers  ($11,200)

  Projected Commodity Revenue  $260,000
       (Aug 1, 1999 to July, 31, 2000)

  Number of customers       30,000
       (3 month average at Aug 1, 1999)

  Gross Recycle Charge         $2.81

  Deferred Adj. Due customers - earlier year           (.03)
       ($11,200/12/30,000)

  Commodity Adjustment - projected year          (.69)
       ($260,000/12/30,000)

  Net Amount Billed Customers         $2.09
       (Beginning October 1, 1999)







FINDINGS

  The Commission finds that implementation of the proposed deferred accounting 
mechanism is a fair, just, and reasonable approach of setting rates that 
equitably balances the interests of solid waste providers and their customers 
against the 
risks of changing commodity values.  The Commission hereby approves LeMay, 
d/b/a Butler Cove and Pacific’s proposals to initiate a deferred accounting 
methodology to update the commodity credit portion of its overall residential 
recycling rate on a recurring basis.


O R D E R

  
  THE COMMISSION THEREFORE ORDERS That LeMay d/b/a Butler Cove and Pacific’s 
requests to enter into a deferred commodity adjustment methodology for its 
residential curbside program in its proposed tariffs is approved, and will 
become effective August 1, 1998.  The new tariff pages for deferred recyling 
must bear an expiration date of October 1, 1999, and be renewed every 12 months 
thereafter.

  

  DATED at Olympia, Washington, and effective this 31st day of July, 1998.

  WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION

           
  CAROLE J. WASHBURN
  Executive Secretary