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Council agrees to realign diversion requirement with hauler capability and pass modest savings to ratepayers
Summary
Following consultant analysis that Waste Management can reasonably achieve about 37% diversion under current state rules, the council authorized staff to amend the franchise agreement to reflect the revised diversion baseline and to seek a phased rate reduction (roughly 1% per year for two years) to return estimated hauler savings to customers.
Council authorized staff to pursue an amendment to the city's franchise agreement with Waste Management that realigns the contract diversion target with current achievable performance and secures a modest rate reduction for customers.
Public Works staff (Anna Luke Jones, speaker 33) and consultant Leith Izette (speaker 27) reviewed why transformation credits used previously to report higher diversion are no longer available under state guidance, and explained Waste Management’s practical diversion performance of roughly 37 percent in 2024. Using two valuation approaches—avoided processing/transform costs and the contract shortfall fee methodology—the consultant estimated the financial impact of lowering the diversion target and recommended an approximate 2 percent rate adjustment in total, proposed as a two-year phase-in at 1 percent per year to return savings to ratepayers.
Waste Management’s local representative (speaker 25) thanked staff for collaboration and expressed willingness to continue negotiations on areas that affect service and contract sustainability. The council voted 5–0 to authorize staff to pursue the amendment and corresponding modest rate reduction.
Staff presented sample dollar impacts for typical residential carts and commercial containers: a 35‑gallon cart would drop by roughly $0.17 per month under a 1% reduction, and certain commercial bin services would see small per-service reductions. The council directed staff to finalize amendment language and administrative steps.
