Berkeley residents could see a 25% hike in their garbage pick-up fees as the city struggles to find a way to bridge the gap between the cost of pick-up services and the income they generate.
In a special session Tuesday night, staff explained that the Refuse Fund, used to cover pick-up fees, is slated to run at an annual $2-3 million deficit over the next five years, leading the city to consider boosting pick-up fees.
As a result, residents who use the most common trash container, which holds 32 gallons, would go from paying about $30 a month to about $37. And those costs would continue to rise annually by 3% beginning in fiscal year 2016 as part of the city’s efforts to adopt a “sustainable rate structure” that could keep pace with rising costs.
Those increases, staff explained to council, would lead to a $5 million surplus in the Refuse Fund by fiscal year 2019, allowing the city to consider ways to update its outdated transfer station, which city manager Christine Daniel described Tuesday night as “not remotely close to industry standards.”
Council members said they were surprised to see such a large jump in projected service costs.
“I don’t know how other people are feeling, but I was pretty alarmed,” said Councilwoman Linda Maio.
Part of the problem for Berkeley is that residents do not pay for recycling or organics pick-up. Fees are tied only to solid waste pick-up, which has declined and is projected to continue to drop. In 2010, the council considered creating a recycling fee to help bridge the gap, but decided to pursue other rate structures.
Some council members suggested that rethinking pick-up fees, and tying them to recycling and organics services, may be necessary going forward. (See a presentation about the program and projections here, as well as the staff report from Tuesday night’s meeting.)
Councilman Gordon Wozniak said it may well be time for the city to charge for recycling and organics, or face declining revenues for years to come. He also noted that the city approved a “substantial increase” in fees three years ago, and said fundamental changes may be needed in the rate structure to avoid the same fate moving ahead.
“I think we have to bite the bullet on this and it’s going to cause some pain,” he said. “If we don’t do that now it’s going to be really, really painful in five years.”
The city has already made changes — such as increasing route efficiencies, using single-operator automated trucks and renegotiating contracts for services — to save money. Those changes have reduced annual costs by $2.5 million, but are not enough, staff told council.
As part of the program, commercial rates would increase as well, but only by a proposed 2.5%, because current fees for those services already mostly cover pick-up costs, staff said.
Marva Sheehan, a consultant hired by the city to help study the issue, said some cities, such as Alameda, are phasing in fee increases over multiple years to soften the blow. Council members said they’d like to look at that option in Berkeley as well.
Council members and members of the public also noted that some services — such as street sweeping, cleaning up illegal dumping and graffiti removal — are paid for out of the Zero Waste Program but should perhaps be covered, in full or in part, by a different funding source so as not to put the burden squarely on residents paying solid waste pick-up fees.
“I could ask, how does street sweeping get us to zero waste,” observed Councilman Laurie Capitelli. “But I’m not going to do that now.”
“If we want these cadillac services,” he said, “we’re going to have to pay, because it’s not free to do.”
All of these efforts are aimed at helping the city meet its goal of reaching “zero waste” by 2020, a goal adopted by council in 2005.
Council members asked staff to bring back additional analysis related to a different fee structure, a possible recycling fee, a possible reduction in the proposed fee increase, and more information on the effectiveness of single-operator trucks, in addition to other requests.
Staff plan to return before council with that analysis early next year, with a proposed effective date for the new fees — depending on what council decides, as well as compliance with Proposition 218 — as of July 1, 2014.
New waste bin pick-up plans: Impossible in Berkeley? (11.30.12)
Layoffs, fee increases proposed for 2012 budget (05.03.11)
Are plastics good or bad? An author explains (04.25.11)
Berkeley’s new recycling carts: How it’s going so far (10.27.10)
City’s new recycling carts met with mixed reception (10.15.10)
New powder-blue split recycle carts coming your way (10.12.10)
A new type of green: Berkeley may charge for recyclables (03.29.10)
Garbage rate structure the problem (02.11.10)
Recycling success leads to city budget woes (02.09.10)