Solid Waste Rates

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Solid Waste Service Rates – Proposed Increases

The City needs to increase the Solid Waste program's rates as the program is currently in a deficit. While we understand that this may be a challenge to the community, it is the City’s responsibility to the ratepayers to close the funding gap now. Recently, the city completed a Solid Waste Rate Study to provide direction on how best to ensure fiscal sustainability for the Solid Waste Program moving forward.  

As recommended by the Rate Study, the City is seeking to raise solid waste service rates by a total of roughly 41% over the next 5 years in order to maintain the current garbage, recycling, and organics service levels as well as to support the service moving forward, and prevent future deficits.  Prior discussion on the solid waste services has been focused on specific services (such as loose in the street (LITS) yard material collection, also called "the claw") and while we know that the level of service is important to our community, our first focus must be to close the funding gap. 

On December 4, the City Council will be asked to approve solid waste rate Proposition 218 notices for single-family and commercial/multi-family customers. If approved, the notices will be mailed out to all city solid waste customers, and the protest hearing will be held at the City Council meeting on February 5, 2019.

Once released, the packet for the Council meeting will be linked here.

Current Solid Waste Rates

With the currently proposed increases, the average rate for a single-family customer with a 65-gallon trash can would see an increase from the current rate of $34 per month, to about $39 per month in 2019, and will reach $51 by 2023.  The chart below shows the proposed increases for single-family residential customers.  

Single Family Garbage Cart Size

Current 2018

Proposed 2019

(13.5%)

Proposed 2020

(10%)

Proposed 2021

(8%)

Proposed 2022

(8%)

Proposed 2023

(5%)

35-Gallon

$31.00

$35.19

$38.70

$41.80

$43.89

$ 46.08

65-Gallon

$ 34.32

$ 38.95

$ 42.85

$46.28

$ 48.59

$ 51.02

95-Gallon

$ 40.94

$ 46.47

$ 51.11

$ 55.20

$57.96

$ 60.86

How long are these rates for?

The rates proposed to the City Council are maximum increases over the next 5 years.  Should future changes to the solid waste service result in lower operational costs, the Council could decide to set rates lower than the maximum requested in this Proposition 218 Notice.

What makes up the solid waste rates?

The costs associated with the solid waste rates are made up primarily of four parts: 

  • The franchise agreement the city holds with the waste hauler (Recology Davis) for garbage, recycling, organics collection and street sweeping, which includes landfill tipping fees, etc. The agreement accounts for 86% of the total cost of the solid waste program.
  • The cost of the city’s Solid Waste and Diversion Programs, many of which are mandated by State regulations. These programs account for 7% of the total cost.
  • Other associated city administrative costs (costs for billing, etc.)These costs are 5% of the program.
  • The reserve/debt service coverage requirements, which account for the last 2% of the program.

If the service isn’t changing, why are rates proposed to increase?

The solid waste program is in deficit. There are a number of reasons why the program’s expenditures are exceeding revenues, and they are detailed in the staff report presented to Council on the solid waste rates. The proposed increases are not the result of the Recology Davis’ acquisition of Davis Waste Removal (DWR), as per contract those costs are not allowed to be passed on to customers. The factors impacting the fund briefly include:

  • The increase in landfill costs that Recology passes through to the city when depositing the waste at the landfill;
  • Repayment of a $3M loan from the city’s wastewater fund for continued operation;
  • Balancing costs associated with the organics collection program the city introduced in 2016.  When implemented, rates were not increased for customers for the organics collection, as it was assumed the additional cost could be covered by an existing fund balance until a rate study could be conducted with data from the implementation. Ultimately, the rates approved in 2013 could not support the program expenditures; and
  • As the beginning of a larger plan for the future of the City’s solid waste services, a number of longer-term costs (such as environmental mitigation costs and the new Artists in Residency program that provides local artists with access to discarded materials as part of public outreach efforts to encourage reuse and recycling) and the development of a larger reserve as a rate-stabilization buffer and protection against unanticipated costs are built into the rates.The goals for these long-term accounts is to build them over many years, reducing the overall impact on customers.

Does that mean the services will change in the future?

Possibly. Staff have been developing a plan for review of the LITS/Claw service levels.  Sign up to receive Council and Commission meeting notifications here

Additional Information

Staff Reports

Utility Rate Advisory Commission Meeting Items

Natural Resources Commission Meeting Items 

  • September 24, 2018

City Council Meeting Items 

City of Davis Web Pages