CCP 09-14-1987 - Laserfiche WebLink

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-- . Minutes of Solid Waste Management Committee, August 17, 1987 . For example, up to now, tipping fees have been in the range of $17 to $18 per ton. This is less than a penny a pound, so if a customer placed an extra 50 to 100 pounds (several bags of grass clippings, for example, out for collection, the hauler would take it since the incremental cost of dumping it was low. No extra would be charged for the pickup. BFI, to illustrate a case, currently provides "unlimited" pickup for $12 a month. Now, tipping fees (at Newport) are $27 a ton, about 1-1/2 cents a pound, and the extra hundred pounds that could be tipped for less than a dollar before, now cost $1.50. The extra 50 - 60 cents doesn't sound like much, but this unavoidable expense subtracts itself almost directly from the bottom line, and if the net after taxes is 5% (60 cents in the case of a $12.00 monthly charge), this eats up all the profit. BFI finds that they can no longer afford to be "nice guys" about pickup. They, and the rest of the haulers presumably, will find ways to recover their added costs, probably through some type of volume-based pricing. The haulers will be limited in any attempt to pass their higher costs unto everyone equally because, as consumers find the fees becoming more significant, they will demand less expensive alternatives. It was suggested that eventually pricing will probably be discrete, by household, based upon the weight collected. Hardware to handle this is being developed, consisting of on-board computerized scales. In fact, all of BFI's front loading fork trucks, used for dumpster pickup, are already . equipped with on-board scales and the customers are charged by the pound. On board scales for residential packers exist now, and the technology is being further refined. We could act to accelerate what is probably already coming, in terms of volume-based pricing, or wait until it arrives on its own. We should remember that the haulers are faced with increasing costs, based upon weight, that they plan to find a way to recover. These costs are expected to continue to rise; the haulers expect the current $27 per ton to rise to $45 per ton by the end of next winter. If we should wish to enact some type of volume-based pricing now, it was suggested that we require all haulers to offer a "recycling rate". BFI offers this in Colorado (and other states) and it consists of a 10% to 15% reduction in the rate for those customers who agree to limit their weekly volume to 60 gallons (2 - 32 gallon cans). It would be up to the hauler to enforce this rate, and it would pose a bit of a hardship on those who offer automated collection, since those containers usually hold about 90 gallons. However, 60 gallon containers are available, and if a hauler should choose to offer the lower rate without enforcement, the monetary loss would be his to bear. Hav~ng haulers offer this lower rate would help justify a City-wide $1.00 recycling surcharge since the effect of that fee would be negat:ed if the customer could opt for a "recycling rate" from the hauler. Or2anized Collection . BFI would prefer to continue with the present open system of hauling. They argue that an open system allows varying service levels and enforces market efficiency since customers can vote with their checkbooks. They -8-