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Staff recommends absorbing GFL surcharge temporarily, then passing cost to customers if needed
Summary
Staff said it will recommend absorbing a contractor inflation surcharge from GFL for three months to avoid immediately passing fuel-driven costs to residents, but warned the city may need to add the surcharge to utility bills if GFL triggers its contract provision.
City staff told the council that the sanitation contractor (GFL) is approaching the contract threshold to apply an inflationary surcharge tied to fuel prices and that staff proposes absorbing that surcharge for the next three months to shield residents temporarily.
“GFL will pull it for 3 months. We're gonna try to do the same ourselves and time with our citizens, but at some point, it's just business,” Presenter said. Staff explained the surcharge is contractually triggered when the contractor’s fuel costs exceed a specified threshold for three consecutive months; if that happens, GFL can pass the surcharge to the city and the city would then consider passing the incremental cost to customers.
Presenter said the three‑month absorption is intended to give the city time to monitor fuel prices and to avoid an immediate rate shock for residents, but that staff expects to return with a recommendation for how to recover the cost if the surcharge becomes operational.
