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Waste Management seeks $352,000 reimbursement for higher recycling processing; council discusses phased billing or city subsidy
Summary
Waste Management said rising processing fees (from ~$75.78/ton to a pay‑on‑yield model averaging ~$116/ton) cost the company ~$241,000 in 2023 and could push total 2024 impact to ~$352,000; options presented included a one‑time midyear payment, a $0.75/month per household charge, or phased city subsidy.
Waste Management representative Dan Darnell told the governing body that commodity‑market shifts since China’s 2018 policy changes have made recycling processing much more expensive and unstable, and that those cost increases have been passed through via their MRF contract.
Darnell said processing fees rose from about $15/ton historically to $75.78/ton after market upheaval and that in January 2023 Barco (the MRF) moved to a flat $125/ton before negotiating a pay‑on‑yield approach; Waste Management reported paying roughly $241,000 in increased processing fees in 2023 and estimated the combined 2023–2024 impact at about $352,000. "We were charged $125 per ton," Darnell said, describing the timeline of increases and the resulting financial pressure.
To address both the retrospective cost and ongoing volatility, Waste Management asked the council to approve an amendment for a one‑time lump‑sum payment (to be included in the midyear budget) and proposed a potential ongoing $0.75/month increase per household beginning January 1 to cover projected processing fees (about $2.25 per quarterly billing cycle). City staff offered alternatives: the general fund could absorb 100% of the costs annually, the city could split costs with ratepayers, or the council could adopt a phased plan where the city covers more in early years and residents assume a greater share later.
Councilors raised concerns about service levels, complaint responsiveness and negotiation leverage with the third‑party MRF. Several asked staff to evaluate options that would leave ratepayers insulated in 2025 but phase in modest monthly charges in 2026 and 2027. Councilor List proposed a simple phased schedule (city covers 2025; residents pay $0.25/month in 2026 and $0.50/month in 2027) that the council directed staff to draft documentation for and include in October materials.
Darnell said Waste Management expects a new modern MRF to open in October 2026 and that the facility should improve commodity returns and allow facility‑level auditing so communities are charged for their actual contamination rates rather than a facility average.
