ic Service Co est Virginia

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1 ic Service Co est Virginia 201 Brooks street, P.O. BOX 812 Charleston, West Virginia Phone: (304) Fax: (304) April 8, 2016 Electronic Service Only William F. Fox, Jr. Solid Waste Services of West Virginia, Inc Audubon Rd Audubon, PA RE: Case Nos MC-42A, MC-42A, MC-42A, MC-42A, MC-42A, MC-42A, MC-42A Solid Waste Services of West Virginia, Inc. Dear Mr. Fox: Staff Memorandum issued today was served via on the above-listed parties. If you wish to respond to Staff Memorandum, you may do so in writing, within 10 days, unless directed otherwise, of this date. You will not receive a copy of the Staff Memorandum by regular mail. Your failure to respond in writing to the utility s answer, Staffs recommendations, or other documents may result in a decision in your case based on your original filiny and the other documents in the case file, without further hearing or notice. When you provide an address you will automatically receive electronic docket notifications as documents are filed in this proceeding. The notifications allow recipients to view a document within an hour from the time the filing ir processed. If you have not done so, you are requested to file the Electronic Mail Agreement, previously mail to you, which allows the Commission to serve all issued in this matter via electronic docket notification. Please note - the Public Service Commission does not accept electronic filings. Therefore, if you wish to respond to the Staff Memorandum you must do so in writing submitted to the Executive Secretary s Office at the above address. IF/jn Enc. Memo Executive Secretary Division

2 FINAL JOINT STAFF MEMORANDUM TO: INGRID FERRELL Executive Secretary DATE: APRIL 8,2015 FROM: JOHN D. LITTLE. Staff Attorney RE: CASE NO MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. (F-4606) and CASE NO MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. (F-5096) and CASE NO MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. (F-6027) and CASE NO MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. (F-6235) and CASE NO MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. (F-6446) and CASE NO MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. (F-6818) and CASE NO MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. (H-9717) Staff recommends Solid Waste Services of West Virginia, Inc. (SWS) be authorized to charge $17.45 per month to its residential customer, an increase of 8.99%.

3 Case Number: MC-42A through MC-42A April 8, 2015 Page 2 Staff further recommends an across-the-board increase of 8.99% for commercial customers. Staffs recommended rates are exclusive of the current 3.97% fuel surcharge. On November 20, 2015, Solid Waste Services of West Virginia, Inc. (SWS) filed an application to increase its rates and charges under its various Certificates. This Memorandum recommends a rate increase for SWS s customers in Marshall, Pleasants, Tyler, and Wetzel Counties. SWS s operations in Brooke County are addressed in a separate Memorandum. In the attached Final Staff Report, Steven M. Kaz, Utilities Analyst Supervisor with the Commission s Utilities Division, recommends SWS be authorized to charge $17.45 per month to its residential customer, an increase of 8.99%. He further recommends an across-the-board increase of 8.99% for commercial customers. Legal Staff agrees with Mr. Kaz s recommendations. It appears that SWS has substantially complied with the notice requirements found in Tariff Rule as evidenced by SWS January 20 and February 11,2016 filings. JDL/cm Attachment cws [d&#jfi H:WLinle\CASES\I MC-42A (SWS)iFinal JSM.docx

4 CASE NO ,81,82,83,84,85,1886-MC-42A SOLID WASTE SERVICES OF WEST VIRGINIA, INC. STAFF RULE 42 EXHZBIT & REVENUE REQUIREMENTS STAFF RECOMMENDED RATES JENNIFER MOORE, UTILITIES ANALYST I UTILITIES DIVISION ON BEHALF OF THE STAFF OF THE PUBLIC SERVICE COMMISSION OF WEST VIRGINIA ***** April 8, Brooks Street, P. 0. Box 812, Charleston, WV 25323

5 SOLID WASTE SERVICES OF WEST VIRGINIA, INC. CASENO ,82, 83, 84,85, 1886-MC-42A TABLE OF CONTENTS STATEMENT PAGE NUMBER Letter of Transmittal A C D H Staff Recommended Statement of Net Income Schedule 1 - Detail of Operating Revenues Schedule 2 - Detail of Operation and Maintenance Expenses Schedule 3 - Depreciation and Amortization Schedule 4 - Taxes Other Than Federal Income Taxes Schedule 6 - Other Income Schedule 7 - Other Income Deductions Present, Proposed and Staff Recommended Tariff Customer's Bill Analysis Adjustments Cash Flow Analysis Current Tariff Proposed Tariff Staff Recommended Tariff

6 @ u6fic Service Commission Of West Virginia 201 Brooks Street, P. 0. Box 812 Charfeston, west Qirginia Phone: (304) FxX: (304) April 7, 2016 Public Service Commission 201 Brooks Street Charleston, WV Re: Case No MC-42A Solid Waste Services of West Virginia, Inc. Dear Commissioners: An examination has been made of the books and records of Solid Waste Services of West Virginia, Inc.(SWSWV, Company) for the year ended December 3 1, SWSWV operates two solid waste removal companies in West Virginia. Staff has prepared two separate reports to depict SWSWV s operations. During the test period, SWSWV served customers in Pleasants, Marshall, Tyler and Wetzel Counties, WV under P.S.C. M.C. Certificate Nos. F-4606, F-5096, F-6027, F-6232, F-6235, F-6818, F-6446, H-9717 and H SWSWV also served customers in Brooke County, West Virginia, under PAC. M.C. Certificate No. F SWSWV s books and records are maintained at its home office in Audabon, PA. The following report depicts SWSWV s Pleasants, Marshall, Tyler and Wetzel County operations. S WS WV s Brooke County operations will be addressed under separate cover as Case Nos MC-42A. Pasquale Mascaro is the President and sole stockholder of SWSWV, as well as the President and sole stockholder of Valero Terrestrial, which owns and operates the landfill in Brooke County, to which SWSWV transports solid waste from its customers in Brooke County.

7 Case No MC-42A Solid Waste Services of West Virginia, Inc. April 7,2016 Page 2 SWSWV is a Subchapter S corporation an- is currently authorized to charge a monthly residential rate of $16.01 plus applicable fuel surcharge. SWSWV is seeking to increase its residential rate for these certificates from $16.01 per month to $27.50 per month, an increase of approximately 71.77%, with no proposed increase in commercialiindustrial charges. At Per Books, SWSWV had operating revenues of $3,3 11,054 which resulted in a net income of $202,364 and cash flow surplus of $328,878. At Going Level, Staff has included requests for pay increases for employees as well as the corresponding adjustments to applicable payroll taxes and for the increased cost of employee benefits. Staff has also included adjustments to depreciation to allow for $680,000 in capital expenditures. At Going Level, SWSWV included State and Federal income tax calculations arguing that shareholders must pay tax on allocated income which reduces the overall return on their investment in SWSWV. Subchapter S corporations avoid income taxes on the corporate level but income distributed to shareholders is taxed at personal income tax rates. Staff points out that the SWSWV shareholder chose to incorporate as an S corporation in order to avoid the double taxation of paying income taxes as a corporation as well as having shareholders pay income tax on dividends or distributions. As can be seen in SWSWV s financial statements, overhead can be allocated to SWSWV in order to reduce or eliminate corporate income. Further, Staff is charged with designing rates that generate sufficient revenues to meet the Company s revenue requirement and in the case of an S corporation income taxes are clearly not part of its cost of service. At Going Level, SWSWV s current rates will generate operating revenues of $3,3 11,054 and result in a net loss of $1 18,645 and a cash flow surplus of $128,866 with an operating ratio of %. Staff has not included an allowance for State and Federal Income taxes. At Pro Forma, the applicant s proposed rates would produce operating revenues of $4,2 1 1,920 resulting in a net income of $782,220 and a cash flow surplus of $1,029,732 with an operating ratio of 81.46%. Staff believes the proposed rates to be excessive. Staff recommends SWSWV be authorized to charge $17.45 per month to its residential customer, an increase of 8.99%. Staff further recommends an across-the-board increase of 8.99% for commercial customers. Staft s recommended rates are exclusive of

8 Case No MC-42A Solid Waste Services of West Virginia, Inc. April 7,2016 Page 3 the current 3.97% he1 surcharge. Staffs recommended rates will generate operating revenues of $3,608,863 resulting in a net income of $179,164 and a cash flow surplus of $426,675 with an operating ratio of95.08%. Utility Staff also recommends that SWSWV be ordered to implement the Staff recommended employee salary increase within one (1) month of these rates being approved. Utility Staff also recommends that SWSWV be ordered to purchase the new equipment within three (3) months of this case becoming final. Proof of employee pay raises and purchases need to be submitted to Utility Staff as soon as possible. The following report is based upon the Commission s Rule 42 and is believed to be self-explanatory. Sincerely, StevenKaz; Utilities Analyst Supervisor Utilities Division

9 Solid Waste Service of West Virginia, Inc. (Brooke County Division) Case No MC-42A Summary of Staffs Recommendation OPERATING REVENUE Residential Commercial Other Total Operating Revenue OPERATING REVENUE DEDUCTIONS Operating Expenses Salaries & Wages Compensation to OwnersIOfficers Gas, Oil, & Grease Truck Repair Expense Landfill and Dumping Tires Expense Office Supplies and Expense Other Depreciation Taxes Other Than Federal Income Tax Total Deductions Net NET INCOME -- or CASH SURPLUS Income Cash Flow Detail Statement Analysis ($) ($) ($1 632, ,530 50, , , ,704 6, ,903 3,177 43, , , ,829 32,464 28,302 28, , ,131 45,110 77,573 45,110 77,573 Operating Ratio Before Income Taxes 95.07% 1

10 Solid Waste Service of West Virginia. Ine~ (Brooke County Division) Statement of Net Income Year Ended December 31,2014 Statement A Operating Revenucs Operating Revenue Deductions Operation and Maintenance Expense Depreciation Expense Taxer Other Than Income Taxes T d Operating Revenue Deductions P E Boob ~ Reference Per Books Adjustments Per Books Going Level Pro Forma Staff Inc (Dec) Adjusted Adiurments Going Level AdiusmentS Pro Forma Recommended (1) ( (4) 15),, 16) (7) ~, [XI \-, $ I 16 Statement A-I Statement A-2 Stafemed A-3 Statement A 4 813,011 8i , i , , ,659 55, , , ,395 (2.932) 32, ,464 22, ,710 28,302 28,302 28, , ,646 57, , ,594 Net Operating Income (Loss) 1,364 1,364 (57.948) (56,584) 252, ,326 45,110 Other Income Statement A Net Income (Loss) 1,405 1,405 (57,948) (56,543) ,367 45,151 Operating Ratio Before Income Taxes *rating Ratio ARcr Income Taxes 99.83% 99.83% 99.83% 99.83% % % 81.58% 95.07% 81.58% 95.07%

11 Solid Waste Service of West Virginia, Inc. (Brooke County Division) Operating Revenues Year Ended December 31,2014 Operating Revenues Per Books Adjustments Per Books Going Level Per Books Inc (Dec). Adjusted Adjustments (1) (2) (3) (4) $ $ $ $ Pro Forma Going Level Adjustments Pro Forma (5) (6) i7) $ 6 $ Statement A-I Staff Recommended (8) $ Residential Customer Revenues 562, , , ,171 (8) 904, ,961 Commercial Customer Revenues 205, , , , ,530 Fuel Surcharge Revenues 44, ,631 44,631 (89,262) (9) (44,631) 50,214 Total Operating Revenues 813, , , ,909 1,065, ,704 w

12 Solid Waste Service of West Virginia lnc. (Brooke County Division) Operation and Maintenance Expense YearEndedDecember Statement A-2 Per Books Per Books Going Level Adjusted Adjustments (3) (4) $ $ Going Level Pro Forma Adjusfments (5) (6) s s Pro Forma (7) s Staff Recommended (8) s Wages - Commercial Wages - Residential Wages -Other Employee Benefits Landfill and Dumping Fuel & Lubricants Parts Tires and Tubes Outside Repairs Towing Expense Road Expense Outside Setvices Insurance Wwkas Compensation Repairs & Maintenance Rent Radio Expense Shop Supplies Welding Supplies Paint Supplies Uniforms Safety Supplies Advertising & Promotion Bad Debt Expense (Uncollectible accounts) Medical Expense Other Fees & Services Office Supplies & Expense Telephone Expense Administration Fee Inflation Adjustment Total Operation and Maintenance Expense 18,799 IO 1, , ,650 95,903 36,434 13,917 1,852 1, (3.000) 43,672 20, ,000 in1 3,878 2,166 1,171 4,157 I I4 1, , I77 z ,218 18,799 4,997 (2) IO 1, (3) 101,981 23,747 (4) 32, ,650 95,903 36,434 13,917 1,852 1, (3.000) 43,672 20, , ,878 2,166 1,171 4,157 I14 1,680 6, ,500 44,218 23, , ,728 32, ,650 95,903 36,434 13,917 1,852 1, (3,000) 43,672 20, ,000 in1 3,878 2,166 1,171 4,157 I I , , , ,728 32, ,650 95,903 36,434 13,917 1, (3,000) 43, ,000 in1 3,878 2,166 1,171 4, ,680 6, ,177 2,500 44,218 23, , ,728 32, ,650 95,903 36,434 13,917 1,852 1, (3,000) 43,672 20, , ,878 2,166 1,171 4, ,6811 6, ,177 2, , ,659 55, , ,829 ~08,829 P

13 Solid Waste Service of West Virginia, Inc. (Brooke County Division) Depreciation Year Ended December 31,2014 Statement A-3 Per Books Adjustments Per Books Going Level Pro Forma Staff Per Books Inc (Dec). Adjusted Adjustments Going Level Adjustments Pro Forma Recommended (1) (2) (3) (4) (5) (6) (7) (8) $ $ $ $ $ $ $ $ Depreciation Expense 35,395 35,395 (2,932) (I) 32,464 32,464 32,464 Total Depreciation Expense 35,395 35,395 (2,932) 32,464 32,464 32,464

14 Commercial Solid Waste Service of West Virginia, Inc. (Brooke County Division) Depreciation, Depletion and Amortization Year Ended December 3 I, 2014 Date Less: Date Retired Salvage Depreciable Years Depreciation Description Acquired If Applicable Cost Value Basis Life Statement A-3a straight line 2015 dep per year 2014 Expense Depreciation (1) (2) (3) (4) (5) (6) (8) (9) 1998 GMC rear loader RE I23 4/1/2003 4/1/ ,125 63, , GMC rear loader RE 124 4/1/2003 4/1/ ,125 63, , Mack RE 105 7/11/1994 1/11/ ,875 40, , FUL Body RE 67 2/1/1990 2/1/ ,893 32, , Mack RE 67 2/1/1990 2/1/ ,433 69, , Paint RE 67 8/1/1990 8/1/1997 1,500 1, Engine RE 67 11/30/ /30/2008 1,924 1, Parts RE 67 11/30/ /30/2008 6,969 6, Engine RE 45 7/30/1996 7/30/2003 2,984 2, Transmission RE 45 11/18/ /18/2003 3,849 3, Engine RE 45 5/22/1995 5/22/2002 8,788 8, , Engine RE 45 3/29/1996 3/29/2003 6,685 6, Rear Loader 1992 RE 85 12/1/ /1/ ,667 31, , Parts RE 123 9/30/2003 9/30/20IO 5,909 5, Engine UTST 379 5/31/2005 5/31/2002 1,908 1, Parts RE 55 7/31/2005 7/31/2002 7,044 7, , McNcilus 12/31/1998 lu3l/ ,950 35, , Volvo 12/31/ / ,noo 60, , , Volvo 12/31/ /3 ID014 60,000 60, , , Mack 12/31/ /331,' ,000 30, , , Mack 12/31/ /31/ ,000 35, , ,000 Engine 10/31/2008 lo/31/20l1 6,695 6, , Engine 4/30/2009 monc114 10,846 10,846 5.M) 2, Engine 4/30/20 I2 4/30/20 I5 8,500 8, , , Freightliner t1/30/ /30R004 64,899 64, , McNeilus 11/30/ /30/ ,442 33, Containers 4/ /30/ ,610 13, , Containers 4/30/1995 4/30/ ,415 25, , Compactors ~ 9/17/1998 9/17/ ,785 11, , Used Dumpsters -Commercial 3/1/2005 3/1/2009 2,650 2, Containers 12/31/ /31/ ,843 28, , ,120 Containers /31/2020 9,030 9, , ,290 1,290 Current Equipment and Depreciation Expense 785, , , ,395 $2, Equipment Additions used rear load buck 80, , ,667 Containers 25, , ,571 Total Equipment and Depreciation Expense 890,343 32,464

15 Solid Waste Service of West Virginia Inc. (Brooke County Division) Taxes other Than Income Taxes YearEndedDecember Statanent A 4 Per Books Adjustments Per Baok Going Level Pro Forma staff Per Books Inc (Dec). Adjusted Adjustments Going Level Adjustments Pro Forma Recommended (1) (2) (3) (4) (5) (6) (7) (8) s s s s s s s s vehicle licenses F.I.C.A. Expense S.U.T.A. Expense F.U.T.A. Expense Property Taxes Income Taxes 2, ,311 2,3 11 2,3 I 1 16,084 16,084 4,220 (5) 20,304 20,304 20,304 2,921 2,921 1,048 (6) 3,969 3,969 3,969 1,734 1, (7) 1,675 1,675 1, ,592 22,592 5,710 28,302 28,302 28,302

16 Solid Waste Service of West Virginia, Inc. (Brooke County Division) Other Income Year Ended December 31, 2014 Statement A-6 Per Books Adjustments Per Books Going Level Pro Forma Staff Per Books Inc (Dec). Adjusted Adjustments Going Level Adjustments Pro Forma Recommended (1) (2) (3) (4) (5) (6) 17) (8) $ $ $ $ $ $ $ $ loans to affiliates Total Other Income

17 Solid Waste Service of West Virginia, Inc. (Brooke County Division) Present, Proposed and Staff Recommended Rates Year Ended December31,2014 Statement C Residential Rates: Base Rate Fuel Surcharge Total Residential Rate Company Present Rates (1) $ Company Proposed Rates (2) $ Staff Recommended Rates (3) $ Commercial Rates Negotiable Negotiable Negotiable 9

18 Solid Waste Service of West Virginiq lnc. (Brooke County Division) Bill Analysis YearEndedDecember31,2014 Statanent D Residential: Base Rate Residential Fuel Surcharge Revenue Total Residential Revenues Commercial Coslomer Revenue Total Operating Revenues Billing Per Books Adiusted 37, ,591 44, , ,011 Going Level Proposed Revenue Increase Rates Revenue Rates Revenue Amount Pacent (4) (5) (6) (7) (8) (9) s 16 $ $ $ Yo , , , % I (44,63 I) 607, , , % 205, , ,011 1,110, , % -~ Residential: Base Rate Residential Fuel Surcharge Revenue Staff Recammended Revenue Increase Rates Revenue Amount Percent 16) (7) (8) (9) s s IE % ,961 70, % 50,214 5, % Total Residential Revenue Commercial Customer Revenue 683,175 75, % 231,530 25, % Total Operating Revenues 914, , % r 0

19 Solid Waste Services of WV, Inc. (Brooke County) Adjustments Year Ending December 31,2014 ADJUSTMENT NUMBER Page 1 of 2 INCREASE (DECREASE) s (1) Denreciation Exnense GOING-LEVEL ADJUSTMENTS Going-Level depreciation 32,464 Less: Per Books Adjusted depreciation 35,395 Adjustment (2,932) To adjust to reflect Going-Level depreciation expense, per calculations on Statement A-3. (21 Waees - Commercial This adjustment reflects the increase in Commerical payroll wages Going-Level Wages ~ Commercial Less: Per Books Adjusted Contract Labor Expense Adjustment Wages ~ Commercial 23,796 18,799 4,997 (3) Wages -Residential 26,426 This adjustment reflects the increase in Residential payroll wages Going-Level Wages ~ Residential Less: Per Books Adjusted Wages - Residential Adjustment Wages ~ Residential 127, ,443 26,426 (4) Waees -Other 23,747 This adjustment reflects the increase in Other payroll wages Going-Level Wages. Other Less: Per Books Adjusted Wages - Other Adjustment Wages ~ Other 125, ,981 23,747 (5) F.I.C.A. ExDense 4,220 This adjustment reflects F.I.C.A. Expense calculation at Going-Level. Going-Level Applicable Wages increase Applicable Rate Going-Level FICA adjustment 55,170 x ,220 (6) S.U.T.A. ExDense 1,048 This adjustment reflects S.U.T.A. Expense calculation at Going-Level Going-Level Applicable Wages Increase Applicable Rate Going-Level SUTA Adjustment 55,170 X ,048 (7) F.U.T.A. Exaense

20 Solid Waste Services of WV. Inc. (Erooke County) Adjustments Year Ending December 31,2014 ADJUSTMENT NUMBER This adjustment reflects F.U.T.A. Expense calculation at Going-Level. Page 2 of 2 INCREASE (DECREASE) s Going-Level Applicable Wages Increase Applicable Rate Going-Level FUTA Adjustment 55,170 X PRO FORMA ADJUSTMENTS (8) Residential Customer Revenues 342,171 This adjustment reflects Pro Forma revenue, per calculations on Statement D of this report. Pro Forma Residential Revenues Less: Going-Level Residential Revenues Adjustment 904, , ,171 (9) Fuel Surcharee Revenues (44,631) This adjustment reflects Pro Forma revenue, per calculations on Statement D of this report. Pro Forma Fuel Surcharge Revenues Less: Going-Level Fuel Surcharge Revenues Adjustment 44,631 (44,63 I) STAFF RECOMMENDED ADJUSTMENTS (10) Residential Customer Revenue 70,370 This adjustment reflects Staff Recommended revenue, per calculations on Statement D of this report. Staff Recommended Residential Revenues Less: Going-Level Residential Revenues Adjustment 632, ,591 70,370 (1 1) Commercial Customer Revenue 25,741 This adjustment reflects Staff Recommended commercial revenue, per calculations on Statement D of this report. Staff Recommended Commercial Revenues Less: Going-Level Commercial Revenues Adjustment 231, ,789 25,741 (12) Fuel Surcharge Revenue 5,583 This adjustment reflects Staff Recommended revenue, per calculations on Statement D of this report. Staff Recommended Fuel Surcharge Revenues Less: Going-Level Fuel Surcharge Revenues Adjustment 50,214 44,631 5,583

21 Solid Waste Service of West Virginia, Inc. (Brooke County Division) Cash Flow Analysis Year Ended December 31,2014 Per Books $ Per Books Adjusted Going Level $ $ Statement H Staff Pro Forma Recommended $ s Available Cash Operating Revenues Other Income 813, , , ,065, , Total Available Cash 813, , ,052 1,065, ,745 Cash Required Operating Expenses Taxes Other Than Income Tax 753,659 22, , ,829 22,592 28, , ,829 28,302 28,302 Total Cash Required Before Debt Service 116,25 I 776, , , ,131 Cash Available for Debt Service (A) Remaining Surplus 36,801 36,801 (24,079) 228,830 77,614 36,801 36,801 (24,079) 228,830 77,614

22 SOLID WASTE SERVICES OF WEST VIRGINIA, INC MC-42A MC-42A CURRENT TARIFF STATEMENT OF AUTHORITY P.S.C. M.C. CERTIFICATE NO. F-4606 (M.C. Case No ) authorizing operation as a common carrier by motor vehicle in the transportation of garbage, trash and rubbish in the City of New Martinsville and community thereof, Wetzel County, and later amended to authorize operation as a common carrier by motor vehicle in the transportation of trash, rubbish and garbage in all of Tyler County and in that portion of Marshall County which lies within the two (2) mile radius from the Wetzel- Marshall Counties line but excluding therefrom all that territory along W. Va. State Route 2, Burch Ridge and Rines Ridge; and In Wetzel County but excluding therefroin the District of Church and the territory that lies between the Church District line and Barker Road Run in the Center District; and excluding therefrom the territory which lies between the Town of Reader, Wetzel County, West Virginia, and the Harrison County, West Virginia, line; in addition to present operating authority under said certificate and later amended authorizing operation as a common carrier by motor vehicle in the transportation of garbage, trash and rubbish in the City of New Martinsville and community thereof, Wetzel County; and operation as a common carrier by motor vehicle in the transportation of trash, rubbish and garbage as follows: In all of Tyler County and In that portion of Marshall County which lies within the two (2) mile radius from the Wetzel-Marshall Counties line, but excluding therefrom all that territory along W. Va. State Route 2, Burch Ridge and the District of Church and the territory that lies between Church District line and Barker Road Run in the Center District and excluding therefrom the territory which lies between the Town of Reader, Wetzel County, W. Va. and the Harrison County, West Virginia line in addition to [the original] operating authority under said certificate; P.S.C. M.C. CERTIFICATE NO. F-5096 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation oftrash, rubbish, and garbage in the City of Sistersville, Tyler County, and a radius of five (5) miles thereof; 14

23 P.S.C. M.C. CERTIFICATE NO. F-5382 to operate as a common carrier by motor vehicle in the transportation of solid waste from points and places in Brooke County, subject to the following exclusions -- (a) excluding the transportation of solid waste from those points and places in Brooke County that are located within the corporate limits of the City of Weirton, as said corporate limits existed as of January 1,2000, (b) further excluding the transportation of solid waste in residential service from those points and places in Brooke County that are located within the corporate limits of the City of Follansbee, as said corporate limits existed as of January 1, 2000, provided, however, that said exclusion shall terminate if and when the City of Follansbee ceases and desists from providing municipal solid-waste collection and transportation services to residential households through the use of motor vehicles owned by that City that are operated by employees of that City, (c) hrther excluding the transportation of solid waste in residential service from those points and places in Brooke County that are located within the corporate limits of the City of Wellsburg, as said corporate limits existed as of January 1,2000, provided, however, that such exclusion shall terminate if and when the City of Wellsburg ceases and desists from providing municipal solid-waste collection and transportation services to residential households through the use of motor vehicles owned by that City that are operated by employees of that City, (d) further excluding the transportation of solid waste in residential service from those points and places in Brooke County that are located to the south of either W. Va. Route 27, commonly referred to as "Washington Pike", or of the southern corporate limits of the City of Wellsburg, as said corporate limits existed as of January 1, 2000, provided, however, that this exclusion shall not apply to service to current or future residents of dwellings that are located as of July 1, 2000, at the street or route addresses set forth in Attachment A, appended hereto, (e) further excluding the transportation of solid waste in commercial service (including service to commercial, industrial, and governmental customers) from those points and places in Brooke County that are located within the territory that is bounded by the following perimeter: Beginning at the point in the Ohio River at which the Ohio-West Virginia state line meets the Brooke-Ohio county line, then proceeding along the Ohio-West Virginia state line in a generally northerly direction to a point due west of the intersection between W. Va. Routes 2 and 67, then proceeding due east from that point to the intersection between W. Va. Routes 2 and 67, then proceeding along W. Va. Route 67 in a generally southeasterly direction to the intersection between W. Va. Routes 67 and 88, then proceeding along W. Va. Route 88 in a generally southerly direction to the point at which W. Va. Route 88 crosses the Brooke- Ohio county line, and then proceeding along the Brooke-Ohio county line in a generally westerly direction to the place of beginning, provided, however, that this exclusion shall not apply to service to current or future occupants of the facilities currently operated by Windsor Coal Company, at the following addresses: 44 Hollow Street, Beech Bottom, WV 26030, and West Liberty Portal, West Liberty, WV 26074, and (0 15

24 further excluding the transportation of solid waste in commercial service (including service to commercial, industrial, and governmental customers) from those points and places in Brooke County that are located within a radius of 0.04 mile of any point or points along the perimeter described in the immediately preceding exclusion --to places of disposal, P.S.C. M.C. CERTIFICATE NO. F-6027 (M.C. Case No TC), authorizing operation as a common carrier by motor vehicle in the transportation oftrash, rubbish and garbage and items adaptable to roll-off container service in Pleasants County and from said county to a point of disposal; P.S.C. M.C. CERTIFICATE NO. F-6232 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation oftrash, rubbish and garbage and items adaptable to a roll off container for commercial customers only, within points and places south of Moundsville, Marshall County, to the Wetzel County line; P.S.C. M.C. CERTIFICATE NO. F-6235 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation of trash, rubbish, and garbage in Wetzel County, excluding the area of Rt. 7 from Porters Falls to the Wetzel-Harrison line, South, and excluding the territory from Wileyville, east. All of Tyler County, except Shirley, and all of Pleasants County, Including 1 1 miles north from the Wetzel County line into the County of Marshall P.S.C. M.C. CERTIFICATE NO. F-6446 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation oftrash, rubbish and garbage in that portion of Marshall County lying south of the city limits of Moundsville to the Wetzel County line P.S.C. M.C. CERTIFICATE NO. F-6818 authorizing operation as a common carrier by motor vehicle in the transportation of trash, rubbish, and garbage from points and places in Wetzel County that are located within a radius of three miles of any point or points along the corporate limits of the city of New Martinsville to places of disposal P.S.C. M.C. PERMIT NO. H-9717 operation of one (1) motor vehicle as a contract carrier in the transportation of trash, rubbish and garbage from the Town of Hundred to a landfill near New Martinsville, West Virginia., via W. Va. Route 7, trailer pick-up only, under contract with the Town of Hundred.

25 PART I: RATES APPLICABLE TO SERVICE UNDER P.S.C. M.C. CERTIFICATE NOS. F F F-6027, F-6232 (commercial only), F-6235, F-6446, F-68 IS. and P.S.C. M.C. PERMIT NO. H-9717 Residential $ per month Rule 30E surcharge $ 0.36 per month Total $ per month Commercial Negotiable (increased by 0.92%) PART I: RATES APPLICABLE TO SERVICE UNDER P.S.C. M.C. CERTIFICATE NO. F-5382 Residential Rule 30E surcharge Total $14.93 per month $ m e r month $15.11 per month Commercial Negotiable (increased by 1.10%) PART 11: ADDITIONAL PROVISIONS RELATING TO RESIDENTIAL SERVICE UNDER P.S.C. M.C. CERTIFICATE NOS. F-4606, F-5096, F-6027, F-6232 (commercial only), F-6235, F F-6818, H-9717, H and F-5382: A. DUTY OF CARRIER TO NOTIFY RESIDENTIAL CUSTOMERS THAT COMMISSION S RATE JURISDICTION EXTENDS TO NEGOTIABLE RATES AND CHARGES: When negotiating a rate or charge with a residential customer, and before receiving payment for any negotiated rate or charge from that customer, this carrier shall first inform the customer that the Commission has jurisdiction over rates and charges for the collection and transportation of solid waste, including both fixed and negotiable rates and charges for such service, and that complaints about both fixed and negotiable rates and charges may be directed to the Commission. B. CHARGES FOR THE COLLECTION AND TRANSPORTATION OF BULKY GOODS FROM RESIDENTIAL HOUSEHOLDS: 1. SUBSCRIBING HOUSEHOLDS: For subscribing residential customers, the applicable base rate and surcharges are set forth elsewhere in this tariff. This carrier shall, once per month, on the scheduled day of bulky goods collection, subject to the following exceptions, collect and transport, free of any additional charge, all discarded bulky goods, as defined in Motor Carrier Rule 1.8, that have been generated by the household of the subscribing residential customer. 17

26 Exceptions: (1) This carrier may, but is not required to, assess that subscribing residential customer an additional, negotiable charge for each large bulky goods item (equivalent in size to a normal refrigerator or washing machine) after the first two (2) large bulky goods items, generated by that subscribing household, that this carrier collects and transports on a scheduled day of pickup. This carrier shall add that extra charge to the next bill that is issued to that customer. (2) This carrier may, but is not required to, assess that subscribing residential customer an additional, negotiable charge for each used or waste tire after the first eight (8) used or waste tires, off the rim, having a radius of no more than 16.5 inches, generated by that subscribing household, that this carrier collects and transports during a twelve-month period. Once such an extra charge is assessed, this carrier shall add that extra charge to the next bill that it issues to that customer. (3) Bulky goods generated by a subscribing residential household do not include any bulky goods resulting from commercial activities that may occur on the premises of that residential household. With respect to such bulky goods, the applicable business entity shall be treated as a commercial customer of this carrier. (4) With respect to any bulky goods generated by a subscribing residential household, that are collected on a date other than the regularly scheduled day of bulky-goods collection, this carrier may, but is not required to, assess the subscribing residential customer an additional, negotiable charge for each such bulky goods item. This carrier shall add the extra charge to the next bill that is issued to that customer. 2. NONSUBSCRIBING HOUSEHOLDS: For nonsubscribing residential households, the applicable charge is $15.00 per pickup. This carrier shall, once per month, on the day of bulky goods collection, subject to the following exceptions, collect and transport, free of any additional charge, all discarded bulky goods, as defined in Motor Carrier Rule 1.8, that have been generated by the nonsubscribing residential household. Exceptions: (1) This carrier may, but is not required to, assess that nonsubscribing residential household an additional, negotiable charge for each large bulky goods item (equivalent in size to a normal refrigerator or washing machine) after the first two (2) large bulky goods items, generated by that household, that this carrier 18

27 collects and transports on that day. (2) This carrier may, but is not required to, assess that nonsubscribing residential household an additional, negotiable charge for each used or waste tire, generated by that household, that this carrier collects and transports on that day. The charge per tire is not to exceed the sum of fifty cents ($0.50) plus the Commission-approved charge for the acceptance of that tire by the landfill which this carrier uses for the disposal of solid waste. (3) For each nonsubscribing residential household, this carrier may require payment of all charges prior to the collection and transportation of these items. In the alternative, this carrier may issue a bill for these charges to the appropriate individual after the collection and transportation of these items. (4) Bulky goods generated by a nonsubscribing residential household do not include any bulky goods resulting from commercial activities that may occur on the premises of that residential household. With respect to such bulky goods, the applicable business entity shall be treated as a commercial customer of this carrier. C. CHARGES FOR THE COLLECTION AND TRANSPORTATION OF LARGE AND/OR HEAVY ITEMS THAT ARE NOT DEFINED AS BULKY GOODS FROM RESIDENTIAL HOUSEHOLDS: SUBSCRIBING AND NONSUBSCRIBING HOUSEHOLDS: For collecting and transporting large and/or heavy items of solid waste that do not fall within the definition of bulky goods under Motor Carrier Rule I.8, this carrier may, but is not required to, assess both subscribing and nonsubscribing residential households additional, negotiable charges. Examples of such items that are not bulky goods are construction and demolition debris; automotive components, parts or frames that weigh at least two hundred (200) pounds each; automotive parts, such as motors and transmissions, that have a high density; and used or waste tires, off the rim, that have a radius of more than 16.5 inches. For a subscribing residential household, this carrier shall add the extra charge to the next bill that is issued to the subscribing residential customer. For a nonsubscribing residential household, this carrier may require payment of the charge prior to the collection and transportation of these items. In the alternative, this carrier may issue a bill for this charge to the appropriate individual after the collection and transportation of these items. 19

28 LID WASTE SERVICES F WEST VIRGINIA, INC MC-42A MC42A PROPOSED TARIFF STATEhENTOF AUTHORITY P.S.C. M.C.CERTIFICATEN0. F-4606m.C. CaseNo ) authorizing operation as a common carrier by motor vehicle in the transportation of garbage, trash and rubbish in the City of New Martinsville and community thereof, Wetzel County, and later amended to authorize operation as a common carrier by motor vehicle in the transportation of trash, rubbish and garbage in all of Tyler County and in that portion of Marshall County which lies within the two (2) mile radius from the Wetzel- Marshall Counties line but excluding therefrom all that territory along W. Va. State Route 2, Burch Ridge and Rines Ridge; and In Wetzel County but excluding therehm the District of Church and the territory that lies between the Church District line and Barker Road Run in the Center District; and excluding therehm the territory which lies between the Town of Reader, Wetzel County, West Virginia, and the Hanison County, West Virginia, line; in addition to present operating authority under said certificate and later amended authorizing operation as a common carrier by motor vehicle in the transportation of garbage, trash and rubbish in the City of New Martinsviile and community thereof, Wetzel County; and operation as a common carrier by motor vehicle in the transportation of trash, rubbish and garbage as follows: In all of Tyler County and In that portion of Marshall County which lies withiin the two (2) mile radius from the Wetzel-Marshall Counties line, but excluding therefrom all that territory along W. Va. State Route 2, Burch Ridge and the District of Church and the territory that lies between Church District line and Barker Road Run in the Center District and excluding therefi-om the territory which lies between the Town of Reader, Wetzel County, W. Va. and the Harrison County, West Virginia line in addition to [the original] operating authority under said certificate; P.S.C. M.C. CERTIFICATE NO. F-5096 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation oftrash, rubbish, and garbage in the City of Sistersville, Tyler County, and a radius of five (5) miles thereof; 20

29 '.S.C. M.C. CERTIFICATE NO. F-5382 to operate as a common carrier by motor vehicle in the transportation of solid waste &om points and places in Brooke County, subject to the following exclusions -- (a) excluding the transportation of solid waste from those points and places in Brooke County that are located within the corporate liits of the City of Weirton, as said corporate lib existed as of January 1,2000, (b) further excluding the transportation ofsolid waste in residential service from those points and places in Brooke County that are located withiin the corporate limits of the City of Follansbee, as said corporate limits existed as of January 1, 2000, provided, however, that said exclusion shall termi~te if and when the City of Follansbee ceases and desists &om providing municipal solid-waste collection and transportation services to residential households through the use of motor vehicles owned by that City that are operated by employees of that City, (c) further excluding the transportation of solid waste in residential mice fbm those points and places in Brooke County that are located within the corporate limits of the City of Wellsburg, as said corporate limits existed as of January 1,2000, provided, however, that such exclusion shall terminate if and when the City of Wellsburg ceases and desists from providing municipal solid-waste collection and transportation services to residential households through the use of motor vehicles owned by that City that are operated by employees of that City, (d) hrther excluding the transportation of solid waste in residential service from those points and places in Brooke County that are located to the south of either W. Va. Route 27, commonly referred to as "Washington Pike", or of the southern corporate limits of the City of Wellsburg, as said corporate limits existed as of January 1,2000, provided, however, that this exclusion shall not apply to service to current or hture residents of dwellings that are located as of July 1,2000, at the street or route addresses set forth in Attachment A, appended hereto, (e) further excluding the transportation of solid waste in commercial service (including service to commercial, industrial, and governmental customers) from those points and places in Brooke County that are located within the temtory that is bounded by the following perimeter: Beginning at the point in the Ohio River at which the Ohio-West Virginia state line meets the Brooke-Ohio county lime, then proceeding along the Ohio-West Virginia state lime in a generally northerly direction to a point due west of the intersection between W. Va. Routes 2 and 67, then proceeding due east ffom that point to the intersection between W. Va. Routes 2 and 67, then proceeding along W. Va. Route 67 in a generally southeasterly direction to the intersection between W. Va. Routes 67 and 88, then proceeding along W. Va. Route 88 in a generally southerly direction to the point at which W. Va. Route 88 crosses the Brooke Ohio county line, and then proceeding along the Brooke-Ohio county line in a generally westerly direction to the place of beginniig, provided, however, that this exclusion shall not apply to service to current or future occupants of the facilities currently operated by Windsor Coal Company, at the following addresses: 44 Hollow Street, Beech Bottom, WV 26030, and West Liberty Portal, West Liberty, WV 26074, and (9 21

30 further excluding the transportation of solid waste in commercial service (including service to commercial, industrial, and governmental customers) fiom those points and places in Brooke County that are located within a radius of 0.04 mile of any point or points along the perimeter described in the immediately preceding exclusion --to places of disposal, P.S.C. M.C. CERTIFICATE NO. F-6027 (M.C. Case No TC), authorizing operation as a common carrier by motor vehicle in the transportation of trash, rubbish and garbage and items adaptable to roll-off container service in Pleasants County and &om said county to a point of disposal; P.S.C. M.C. CERTIFICATE NO. F-6232 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation of trash, rubbish and garbage and items adaptable to a roll off container for commercial customers only, within points and places south of Moundsville, Marshall County, to the Wetzel County line; P.S.C. M.C. CERTIFICATE NO. F-6235 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation of trash, rubbish, and garbage in Wetzel County, excluding the area of Rt. 7 from Porters Falls to the Wetzel-Harrison line, South, and excluding the territory from Wileyville, east. All of Tyler County, except Shirley, and all of Pleasants County, Including 1 1 miles north fiom the Wetzel County line into the County of Marshall P.S.C. M.C. CERTIFICATE NO. F-6446 (M.C. Case No TC) authorizing operation as a common carrier by motor vehicle in the transportation of trash, rubbish and garbage in that portion of Marshall County lying south of the city limits of Moundsvifle to the Wetzel County line P.S.C. M.C. CERTIFICATE NO. F-6818 authorizing operation as a common carrier by motor vehicle in the transportation of trash, rubbish, and garbage from points and places in Wetzel County that are located within a radius of three miles of any point or points along the corporate limits of the city of New Madinsvilte to places of disposal P.S.C. M.C. PERMIT NO. H-9717 operation of one (1) motor vehicle as a contract carrier in the transportation of trash, rubbish and garbage from the Town of Hundred to a landfill near New Martinsville, West Virginia., via W. Va. Route 7, trailer pick-up only, under contract with the Town of Hundred. 22

31 PART I: RATES APPLICABLE TO SERVICE UNDER P.S.C. M.C. CERTIFICATE NOS. F-4606, F-5096, F F-6232 (commercial only). F F F-6818, and P.S.C. M.C. PERMIT NO. H-9717 WETZEL COUNTY) (1) Residential $ per month Total $ per month Commercial Negotiable PART I: RATES APPLICABLE TO SERVICE UNDER P.S.C. M.C. CERTIFICATE NO. F ROOKE COUNTY) (1) Residential $24.30 per month Total $24.30 per month Commercial Negotiable PART 11: ADDITIONAL PROVISIONS RELATING TO RESIDENTIAL SERVICE UNDER P.S.C. M.C. CERTIFICATE NOS. F-4606, F F-6027, F-6232 (commercial only), F-6235, F-6446, F H-9717, H and F-5382: A. DUTY OF CARRIER TO NOTIFY RESIDENTIAL CUSTOMERS THAT COMMISSIONS RATE JURISDICTION EXTENDS TO NEGOTIABLE RATES AND CHARGES: When negotiating a rate or charge with a residential customer, and before receiving payment for any negotiated rate or charge from that customer, this carrier shall first inform the customer that the Commission has jurisdiction over rates and charges for the collection and transportation of solid waste, including both fixed and negotiable rates and charges for such service, and that complaints about both fixed and negotiable rates and charges may be directed to the Commission. B. CHARGES FOR THE COLLECTION AND TRANSPORTATION OF BULKY GOODS FROM RESIDENTIAL HOUSEHOLDS: 1. SUBSCRIBING HOUSEHOLDS: For subscribing residential customers, the applicable base rate and surcharges are set forth elsewhere in this tariff. This carrier shall, once per month, on the scheduled day of bulky goods collection, subject to the following exceptions, collect and transport, free of any additional charge, all discarded bulky goods, as defined in Motor Carrier Rule 1.8, that have been generated by the household of the subscribing residential customer. Exceptions: 23

32 (1) This carrier may, but is not required to, assess that subscribing residential customer an additional, negotiable charge for each large bulky goods item (equivalent in size to a normal refrigerator or washing machine) after the first two (2) large bulky goods items, generated by that subscribing household, that this carrier collects and transports on a scheduled day of pickup. This carrier shall add that extra charge to the next bill that is issued to that customer. (2) This carrier may, but is not required to, assess that subscribing residential customer an additional, negotiable charge for each used or waste tire after the first eight (8) used or waste tires, off the rim, having a radius of no more than 16.5 inches, generated by that subscribing household, that this carrier collects and transports during a twelve-month period. Once such an extra charge is assessed, this carrier shall add that extra charge to the next bill that it issues to that customer. (3) Bulky goods generated by a subscribing residential household do not include any bulky goods resulting from commercial activities that may occur on the premises of that residential household. With respect to such bulky goods, the applicable business entity shall be treated as a commercial customer of this carrier. (4) With respect to any bulky goods generated by a subscribing residential household, that are collected on a date other than the regularly scheduled day of bulky-goods collection, this carrier may, but is not required to, assess the subscribing residential customer an additional, negotiable charge for each such bulky goods item. This carrier shall add the extra charge to the next bill that is issued to that customer. 2. NONSUBSCRTBING HOUSEHOLDS: For nonsubscribing residential households, the applicable charge is $15.OO per pickup. This carrier shall, once per month, on the day of bulky goods collection, subject to the following exceptions, collect and transport, free of any additional charge, all discarded bulky goods, as defined in Motor Carrier Rule 1.8, that have been generated by the nonsubscribing residential household. Exceptions: (1) This carrier may, but is not required to, assess that nonsubscribing residential household an additional, negotiable charge for each large bulky goods item (equivalent in size to a normal refrigerator or washing machine) after the first two (2) large bulky goods items, generated by that household, that this carrier collects and transports on that day. 24