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Sheet1 Page 1 SANITATION PRIVATE HAULER CONTRACTS BACKGROUND: Currently the Sanitation Department franchises approximately fifty percent of its operations to private sanitation companies. This was done several years ago in order to increase revenues by decreasing pick-up costs. The private sector is able to service city customers more cheaply than the City's Sanitation Department. The services involved are: 1. Residential 2. Commercial (containerized) 3. Commercial (bulk) 4. Special Services The only service that is not shared with the private companies is the commercial bulk. This service is mostly confined to the downtown area. Merchants put out large plastic bags filled with dry paper material. The rates charged for this service is based upon estimated tonnage per month. Residential rates are fixed and are not based upon tonnage or frequency of pick up. The city charges enough to cover its operations with a small profit built in. Commercial containerized rates however, are based upon several factors: frequency of pick up, container size, and container rentals. SCOPE: This audit will focus on calculating the profit margins of the city's operation vs. the franchised operations of the private companies (the city employs two private companies to service its citizens. The service delivery areas are exclusive and only those vehicles belonging to the respective companies are allowed into their areas). In
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This note was uploaded on 05/16/2011 for the course AUDIT 201 taught by Professor Unknown during the Spring '11 term at Symbiosis International University.

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