Section 096-428-7 - Calculation of the Per Ton Cost by CommodityExpressed as a formula, for a commodity, cost/ton = specific cost/ton + nonspecific cost/ton + shared transportation cost/ton + contractor cost/ton + profit and overhead paid/ton - revenue/ton
Sections 7(A) through (F) below should be calculated with respect to a participating municipality's costs, as defined in Section 6. In cases where an agreement between a participating municipality and its contractor or between a contractor and a subcontractor is for the management of a mixed packaging stream, more than one packaging stream, or includes additional services, Sections 7(A) through (F) below must be calculated for the contractor or subcontractor in order to assign the contractor cost/ton to a commodity.
A.Specific Cost Per Ton. The specific cost per ton is the sum of the labor, equipment, structure, and energy costs that are associated with a single commodity divided by the tons managed. The costs realized by a contractor, the costs associated with the simultaneous management of more than one packaging stream, and the costs associated with a mixed packaging stream are not accounted for in the specific cost per ton.
Expressed as a formula, specific cost/ton = (labor cost + equipment cost + structure cost + energy cost)/tons managed, where
(1) The labor, equipment, structure, and energy costs are calculated according to Section 6. The percent time and the percent use are measured with respect to management activities that are specific to a commodity, such as management activities that are devoted solely to the management of a single commodity.(2) The tons managed are the tons of a commodity sent to a market, as determined in accordance with Section 17.B.Nonspecific Cost Per Ton. The nonspecific cost per ton is the sum of the labor, equipment, structure, and energy costs that are associated with the management of a mixed packaging stream or associated with the simultaneous management of more than one packaging stream, as allocated to a commodity. The costs specific to the management of a single commodity are not included in the nonspecific cost per ton, nor are shared transportation costs or costs realized by a contractor. Expressed as a formula, nonspecific cost/ton = (labor cost + equipment cost + structure cost + energy cost) * percent allocation/tons managed, where
(1) The labor, equipment, structure, and energy costs are calculated in accordance with Section 6. The percent time and the percent use are measured with respect to the management of a mixed packaging stream or the simultaneous management of more than one packaging stream.(2) The percent allocation to a commodity depends on whether a nonspecific cost is associated with the management of a mixed packaging stream or the simultaneous management of more than one packaging stream. (a) In cases where the nonspecific cost is associated with a mixed packaging stream, the percent allocation is the volume of the materials that make up a commodity divided by the volume of all materials in the packaging stream's set of accepted materials. The SO must determine these volumes in accordance with Section 14(B)(1)(b).(b) In cases where the nonspecific cost is associated with the simultaneous management of more than one packaging stream, the percent allocation to that stream is the volume of the materials that make up a commodity, as determined in accordance with Sections 14(B)(1)(c) and 17 divided by the volume of the materials that make up all packaging streams managed utilizing the nonspecific management activity, also determined in accordance with Sections 14(B)(1)(c) and 17. When applicable, the percent allocation to a commodity within a mixed packaging stream must then be allocated in accordance with Section 7(B)(2)(a).(3) The tons managed are the tons of a commodity sent to a market, as determined in accordance with Section 17.C.Shared Transportation Cost Per Ton. The shared transportation cost is the labor, equipment, structure, and energy cost for transporting a mixed packaging stream or simultaneously transporting more than one packaging stream, as allocated to a commodity. Expressed as a formula, shared transportation cost/ton = shared transportation cost * percent allocation/tons managed, where
(1) The labor, equipment, structure, and energy costs are calculated in accordance with Section 6, with the percent time and the percent use measured with respect to shared transportation.(2) The percent allocation to a commodity depends on the method of transport.(a) In cases where the shared transportation cost is associated with a mixed packaging stream, the percent allocation is the volume of the materials that will make up a commodity divided by the volume of all materials included in the mixed packaging stream's set of accepted materials. The SO must determine these volumes in accordance with Section 14(B)(1)(b).(b) When simultaneously transporting unbaled packaging streams, the percent allocation to each stream is the volume used to transport each packaging stream divided by the volume used to transport all packaging streams. The SO must document the percent allocation during a cost study. When a mixed packaging stream is transported in this manner, the percent allocation to commodities within the mixed packaging stream must be further allocated in accordance with Section 7(C)(2)(a).(c) When simultaneously transporting more than one baled commodity, the percent allocation is the tons of each commodity sent divided by the tons of all commodities sent. Unbaled fiber sent to a recycling market can be considered baled for the purposes of allocating shared transportation costs. This percent allocation must be reported annually.(3) The tons managed are the tons of a commodity sent to a market, as determined in accordance with Section 17.D.Contractor Cost Per Ton. The contractor cost is the cost of a service agreement, as allocated to a commodity.(1) When a service agreement is for the management of one commodity stream, the contractor cost per ton is the contractor cost divided by the tons managed, in accordance with Section 17. The contractor cost must be reported annually to the SO.(2) When a service agreement is for a mixed packaging stream, more than one packaging stream, or includes additional services beyond the management of packaging streams, the contractor must participate in a cost study, and Sections 7(A) through (F) must be calculated for the contractor or subcontractor in order to assign the contractor cost/ton to a commodity. Expressed as a formula, contractor cost/ton = specific cost/ton + nonspecific cost/ton + shared transportation cost/ton + subcontractor cost/ton + profit and overhead paid/ton - revenue/ton
Subcontractor cost per ton is figured in the same way as contractor cost per ton.
E.Profit and Overhead Paid Per Ton. The profit and overhead paid must be figured when a service agreement is for the management of a mixed packaging stream or more than one packaging stream but does not include additional services beyond the management of packaging streams. The profit and overhead paid per ton is the contractor cost realized by the participating municipality minus the cost realized by the contractor divided by the tons managed under the service agreement. Profit and overhead paid per ton is the same for all commodities managed under a service agreement.
F.Revenue Per Ton. The revenue per ton is revenue received by a participating municipality for packaging material sold. The revenue received for a commodity is divided by the tons managed, as determined in accordance with Section 17. The revenue per ton must be reported annually to the SO.06-096 C.M.R. ch. 428, § 7