Memorandum

City of Lawrence

Public Works Department

TO:	Charles Soules, Public Works Director
FROM:	Tammy Bennett, Assistant Public Works Director
DATE:	April 22, 2014
RE:	Solid waste rates for 2015 for commercial services

Background

During the annual budget process, the Solid Waste Division reviews the rates for services for the fund.  NO rate changes for our traditional solid waste services have been presented since July 2011.  There is a fee to fund residential curbside recycling services on single-family and multi-family facilities that will go into effect this fall.  Each residential bill will increase by $2.81 to fund curbside recycling.

Commercial rates have also not been adjusted since 2011.  Operating costs have continued to increase, including personnel costs (labor rates, retirement contributions, and health insurance), landfill fees (increase 3.5% per year), and fuel / equipment costs.  Landfill rates were $24.50 per ton in 2011 and will be $27.94 in 2015.  Dumpster rates are fixed by size of container and number of collection days. 

Historically, we have tried to make small, consistent adjustments in our rates to minimize impact on customers.  Staff recommends a rate increase for 2015 of two percent (2%) for commercial customers that would offset some of the operational costs.  The minimum commercial rate would increase from $21.71 to $22.14.  Other container rental and pick-up fees would be adjusted accordingly.

Some staff concerns about not making an incremental rate adjustment in 2015 include:

• Landfill contract expires with Hamm Industries at the end of 2015
• Implementation of single-stream recycling options (future phases) will result in additional fees for some commercial customers
• Phased development of the Kresge Road facility will require financed improvements, which will have a modest rate impact for customers in the future

Recommendation

Staff recommends a commercial rate increase of two percent (2%) for 2015 and will complete more extensive rate analysis for submittal later in the budget process.