Commentary:

The procedure, timing of and frequency of reviewing possible adjustments to the tipping fee must be specified.

Such adjustments may be necessary to reflect changes in inflation and cost of service elements (such as fuel, electricity and other utilities, imported materials or chemicals, or other supplies). Local cost inflation indices would be a reasonable benchmark. Extraordinary events that may trigger changes to the tipping fee structure should be clearly identified as well. Planned additional capital expenditures may also result in a change to the tipping fee structure.

A separate assessment for special wastes like liquid or bulky wastes may be provided.

In addition, the mechanism and frequency of adjustments to account for foreign exchange fluctuations on specific cost components that are affected should be incorporated in the formula.

Procedures for appealing adjustments to tipping fees should be set out in the contract. The process for resolving disputes under the Agreement may apply in this situation.

An example of a tipping fee adjustment provision in a waste disposal contract for a municipal government is presented below:

The disposal fee will be subject to adjustment annually every [•] . The first adjustment may be made on [•]. The maximum increase allowable any one year will be equal to the percentage change in the Consumer Price Index (CPI).

Said change shall be equal to the change in the CPI for all urban consumers for the [•] Metropolitan Area, as published by the [•]. Such change shall be measured for the 12-month period January to December. The first increase shall be effective [•], based upon changes in the CPI formula for the period between January 200[•] through December 200[•].