Thurston County solid-waste rate study proposes two-step increase to avoid deeper shortfalls

Josiah Close, a consultant with HDR Engineering, presented a preliminary rate study to the Thurston County Solid Waste Advisory Committee showing the county’s solid-waste utility has not updated rates since 2012 and has seen cumulative inflation of roughly 39–40%. Close said the study is informational and “this won’t be an action item for today.”

The consultant recommended a two-year rate adjustment and use of some reserves to smooth the impact on customers. “The current garbage tip fee [is] $119 a ton,” Close said, and the draft proposal would raise the systemwide tip fee to $136 per ton for 2026 and $154 per ton for 2027. Close told the committee the study also proposes raising the county’s self-haul minimum from $18 (under 300 pounds) to $21 in 2026 and by another $2 in 2027, and increasing the organics (yard/garden) charge to $75 in 2026 and $90 in 2027.

Why it matters: the study ties the proposed increases to two budget realities: long-term deferred capital needs and climbing operating costs. Close told the committee the utility faces roughly $41.5 million in capital projects over the next five years, led in the near term by a planned site reconfiguration and, in later years, the potential cost of a second transfer station. The rate design aims to collect adequate operating revenue, fund capital renewal and replacement, and maintain cash reserves so the utility can meet day-to-day needs and preserve borrowing capacity.

Key details from the presentation

- Purpose and methodology: HDR used a three-step approach — a revenue-requirement analysis to set total needs, a cost-of-service analysis to apportion those costs, and a rate-design phase to assign dollar amounts to each rate line item.

- Reserves and timing: the firm recommended drawing construction reserves strategically during near-term capital spending to reduce immediate rate shock. HDR noted a modeled dip below the county target of 90 days of operations-and-maintenance reserves in 2027 but projected recovery afterward.

- Rate design specifics: the study maintains the county’s existing structure with limited changes. HDR proposed a non-taxed rate for curbside haulers (designed to reflect that some haulers pay the 3.6% solid-waste tax separately), a uniform charge for organics loads (eliminating the current two-tier organics rate based on 10-yard thresholds), and adjustments to better align the organics-to-garbage rate relationship with regional peers (a target of organics at roughly 70% of the garbage tip fee).

- Customer impacts: HDR showed most self-haul customers pay the minimum charge; approximately 51% of customers currently pay the $18 minimum and only about 9% pay amounts approaching the full tip-fee equivalent. HDR said the proposed increase to the minimum ($3 in 2026, then $2 in 2027) would have a modest per-visit impact on most users.

Questions and committee discussion

Committee members asked whether the utility is operating at a deficit and whether the increases are large enough to cover future changes in hauling or disposal contracts. County staff clarified that the solid-waste utility is supported entirely by tip fees and service revenue and does not use general-fund taxes. Close said the modeled revenues fall below anticipated costs under current rates and that reserves are being used to bridge some shortfalls in the five-year window. Members also discussed contract and rail logistics for outbound waste and agreed to request Republic and other contractors at a future meeting to clarify potential changes in disposal routing or rail termination dates.

Small-quantity business hazardous-waste fee: policy suggestion

Several committee members raised the small revenue contribution from business hazardous-waste drop-offs (noted in the presentation as roughly $21,000 in total) and suggested removing the per-visit fee for very small quantity generators (those under the 220 lb/month threshold). One member argued removing the fee could increase proper disposal by small businesses and would have “insignificant” revenue effect relative to the utility’s multi‑million-dollar budget.

Next steps

HDR and county staff asked the committee for initial feedback and said the study will be revisited at the March meeting; the committee did not take formal action on rates at this session. Staff said the board of county commissioners would consider any recommendation later and that, if adopted, the goal would be to implement new rates January 1, 2026, following any required public hearing and incorporation into the 2026–27 biennial budget.

Ending note

Committee members asked staff and HDR to return with more detail on contract terms (Republic, Waste Connections, rail agreements), and to provide clarifying tables that break down who pays which line items; staff agreed to include those items in the next presentation.