(1) City service. To the extent solid waste collection service is provided within the limits of a city or town, it must be provided by:

(a) A solid waste collection company regulated by the commission operating under a commission-issued certificate authorizing such service; or

(b) A city or town that self-hauls or contracts for service, exempt from commission regulation under the exemption for cities in RCW 81.77.020.

(2) City service—Cancellation of certificated authority and termination of commission regulation.

(a) The commission will cancel the affected certificated authority and cease regulation in the affected area on the date that a city or town commences service as specified in its notice to the commission unless (b) of this subsection applies.

(b) If a city or town commences service before notifying the commission in writing, the commission will not cancel the affected certificated authority and cease regulation in the affected area until the date of receipt of the city's or town's written notice.

(3) Company responsibilities. When entering into a contract with a city or town to provide solid waste collection services, a regulated company must advise the commission within thirty days of the date of the agreement if the area to be served is contained in the company's certificated authority. Notice must include a cover letter, a copy of the executed agreement, and a map of the affected area. The map submitted must meet the standards defined in WAC 480-70-056.

(4) Compensation for canceled certificated authority. A company must notify the commission in writing within thirty days of a city or town purchasing or condemning all or a portion of its certificated authority. Notice must include a cover letter and a copy of the relevant document such as an ordinance, resolution, franchise, or contract.

(5) City service discontinued. When a city notifies the commission of its decision to discontinue providing solid waste collection service to the extent solid waste collection service is provided within the limits of a city or town:

(a) Except to the extent set forth in subsection (4) of this section, the previously canceled certificated authority will be reinstated, and a new or revised certificate will be issued to the previous certificate holder or its successor if the previous certificate holder, or its successor, petitions for reinstatement and:

(i) Prior certificated authority was canceled by city annexation or incorporation; or

(ii) Prior certificated authority was canceled by commencement of city service under RCW 80.77.020.

(b) The commission will consider all applications for new certificated authority if the previous certificated authority was purchased or condemned.

(c) The commission will consider applications for new certificated authority if no previous certificate holder exists.