December 6, 2022
Economic Development
DATE: December 6, 2022
TO: Mayor Butt and Members of the City Council
FROM:
Shasa Curl, City Manager
Samantha Carr, Environmental Manager
Subject:
Annual Solid Waste Rate Adjustment
FINANCIAL IMPACT: There is no significant financial impact to the City’s General Fund.
PREVIOUS COUNCIL
ACTION:
December 7, 2021
STATEMENT OF THE
ISSUE:
The Franchise Agreement between the City of Richmond
and Republic Services provides for an annual adjustment based on the Consumer Price Index (CPI) and bulky item
pick-up program participation.
RECOMMENDED ACTION: ADOPT a resolution to update the 2023 solid waste collection rates - City Manager’s Office, Economic
Development (Shasa Curl/Samantha Carr 620-5407).
DISCUSSION:
The City of Richmond’s solid waste and recycling services are provided by two agreements with Republic Services: 1) a collection franchise agreement managed by the City of Richmond; and 2) a post-collection agreement managed by the West Contra Costa Integrated Waste Management Authority (“RecycleMore”). Pickup rates are set at the end of the year based on CPI adjustments.
AGENDA
REPORT
December 6, 2022
Adjustments to the 2023 solid waste collection rate include: a) CPI adjustment and b) the bulky item program adjustment charges. Approximately 77 percent of Richmond residential customers subscribe to the 35-gallon trash cart service. The 2023 financial impact for solid waste collection services for the 35-gallon cart service will amount to: a) CPI increase of $1.13 per month and b) bulky item adjustment of ($0.16) for a total collection increase of $0.97. In addition, the post-collection agreement results in an increase of $12.60 per month for 35-gallon cart service. A summary of the residential and commercial collection and post-collection rates for the 2023 calendar year are also noted below in Tables 2 and 3 as well as in Attachments 1 and 2.
CPI Adjustment
Pursuant to the collection Franchise Agreement between the City of Richmond and Republic Services, the City is obligated to adjust the solid waste collection rates on an annual basis according to the change in the CPI. The attached letter from Republic Services provides an official notice of the percentage increase (Attachment 2).
City Council adoption of the resolution updates and formalizes the 2023 solid waste collection rates (Attachment 1). The terms of the City’s collection Franchise Agreements with Republic Services state the collection rates are to be adjusted by the CPI. The indicated October 2021 to October 2022 CPI change for the San Francisco-Oakland- Hayward Metropolitan Area is 6.0 percent.
Under terms of the 2014 Franchise Agreement Amendment, City staff members negotiated that CPI increases for residential customers for the years 2018 through 2025 shall be capped at a maximum of 3.25 percent annually with an overage of 2.75 percent. There is an additional .57 percent carryover from the previous rate setting year for a total carryover of 3.32 percent to 2024. The commercial customer rates will be adjusted by the CPI rate of 6.0 percent from the 2022 base rate.
Bulky Item Participation
An enhanced bulky item collection service was included in the 2014 Franchise Agreement for residential customers. Residential customers may schedule a pick-up for bulky items (up to three items) at no additional cost once per year by calling Republic Services at (510) 262-7100. The program aims to reduce or prevent illegal dumping by providing a bulky item collection service to ratepayers and incorporating the costs into the monthly rates. Bi-lingual participation flyers are included as bill inserts twice per year to encourage participation (below right). Illegal dumping postcards are also posted around City Hall and City facilities (below left). For more information about the program visit, www.richmondenvironment.org.
December 6, 2022
In 2022, the number of participant households slightly decreased from 11.3 percent to
10.5 percent of all Richmond households. The slight decrease in participation will result in a $0.16 per month rebate of solid waste collection rates for the 2023 calendar year.
Republic Services and the City have collected data from 2012 to present on illegal dumping and bulky item pick-ups within the City. The data can be viewed on the city’s Transparent Richmond website. Since 2012 there has been an overall decrease in the amount of illegally dumped bulky items abated by City crews (Graph 1) and with a corresponding overall increase in the number of bulky items collected by Republic Services (Graph 2). These graphs represent bulky items such as televisions, mattresses, furniture, tires, and similar household items.
The data source for all of the graphs was provided by Republic Services transfer station receipts and annual bulky item participation reports.
Graph 1: Illegally Dumped Bulky Items 2012 – 2021
December 6, 2022
Graph 2: Republic Services Bulky Item Pick-up Program Participation: Program Start in 2015 to 2022
Graph 3: Illegally Dumped Solid Waste 2012 - 2021
Post-Collection Rate Adjustment
On November 10, 2022, the Regional RecycleMore Board, comprised of three Richmond Board Members, approved post-collection rate adjustments as shown below in Table 1.
Table 1: Post Collection Agreement Percent and Dollar 2023 Rate Increase Percent Increase from 2022 Dollar Increase from 2022
Residential Sector
(35 Gallon Cart)
2.6% $.32 Per Month
Commercial Sector -8.1% -$1.00 Per Cubic Yard
Industrial Sector 8.5% $15.15 Per Ton
December 6, 2022
Table 2: 2023 Residential Service Rates (Monthly)
Table 3: 2023 Commercial Rates (Monthly)
DOCUMENTS ATTACHED:
Attachment 1 – Resolution Updating Solid Waste Service Rates Attachment 2 – Republic Services CPI Adjustment Notice