January 25, 2022 – Sacramento City Council
John Febbo, Integrated Waste General Manager
Ordinance Amending Fees and Charges for
Recycling and Solid Waste Services
CORE SERVICES
GARBAGE
• Weekly collection
ORGANICS
• Weekly containerized collection
• Loose in the Street collection
RECYCLING
• Every-other week collection
STREET SWEEPING
• RSW sweeps over 150,000 miles
of streets annually
Tons Collected
FY20 FY21
30,900 33,000
71,000 70,200
129,400 141,200
Total Curbside Residential
Programs Collection: 231,300 244,400
3 OTHER SERVICES & PROGRAMS
115 residential collection vehicles dispatched daily,
Monday – Friday, from two locations
ADDITIONAL PROGRAMS:
• Public outreach and education
• Code enforcement investigations
• Illegal Dumping Mitigation
• Landfill maintenance and monitoring
• Mattress Collection
RSW collects almost 18 million
containers annually.
ADDITIONAL SERVICES PROVIDED:
• Used oil, battery, appliance & e-waste pickup
• Household Hazardous Waste
• Appointment based Household Junk Collection
• Can Retrieval for Qualifying Disabled Customers
• City’s Disaster Debris Management Plan
(FEMA/CalOES)
4 • New yard waste/organics
processing requirements
and increased costs
• Potential increase in
recyclables processing cost
• Maintaining staffing and equipment
levels
• COVID-19 impacts
• Inflationary impacts
CHALLENGES FACING RSW
5 With and Without Rate Adjustment
5-Year Fund Balance Projection and 90-Day Reserve Target FY2021-2026 5-YEAR FORECAST – SOLID WASTE FUND
Senate Bill (SB) 1383
• SB 1383 is a State mandate requiring
diversion of all organic material from
landfills
• City must divert all organic material and
yard waste from landfills, both
residential and commercial
• City bears the cost of implementation
and ongoing compliance of organics
diversion, and reporting
• Implementation of City-wide food waste
collection from residential customers
this summer - 2022
6 YARD WASTE AND ORGANICS MANDATE
7 City participated in a regional Request for Proposals (RFP) for organic material diversion services with the County of Sacramento and City of Folsom in an effort to reduce costs.
Although competitively bid, processing fee for organics will increase from an average of $41 per ton in FY2019/20 to an average of $104.15 in FY2025/26.
YARD WASTE AND ORGANICS PROCESSING COST PER TON
$41.00 $46.39
$90.13 $92.77 $95.49 $101.18 $104.15
$0
$20
$40
$60
$80
$100
$120
FY2019/20 FY2020/21 FY2021/22 FY2022/23 FY2023/24 FY2024/25 FY2025/26 $$ Dollars
Yard Waste and Organics Processing (Cost Per Ton)
8 Organics tonnage is expected to increase from ~70,000 tons in FY2020/21 to as much as ~85,000 tons in FY2025/26.
YARD WASTE AND ORGANICS ANNUAL PROCESSING COST
$2.91 $3.30
$6.91
$8.52 $8.74 $8.95 $9.18
$-
$2
$4
$6
$8
$10
FY2019/20 FY2020/21 FY2021/22 FY2022/23 FY2023/24 FY2024/25 FY2025/26 Millions
Estimated Annual Yard Waste and Organics Processing Cost (In $$$ Millions)
Processing expenses will increase from $3.3M from FY2020/21 to an estimated $6.9M FY2021/22 and an additional $1.6M upon organics implementation in FY2022/23. • 10.9% increase in garbage tonnage
• 15.6% increase in household junk tonnage
• 6.4% increase in curbside recycling tonnage
• 39.2% increase in tonnage from dump coupon usage
• 23.2% increase in responses to illegal dumping (General Fund, not RSW).
Increases are anticipated to continue until the pandemic passes. These increases further deteriorate the RSW fund balance.
COVID-19 DISPOSAL IMPACTS
In calendar year 2020, due to the Sacramento County stay at home order, RSW noted significant increases in residential disposal tonnage and associated costs including:
• Completed citywide re-route and re-organization from 4-day/10-hour to 5- day/8-hour workweek in February 2021.
• Completed organics processing agreements with three vendors, up to 5+ years in length. While processing fees are higher, there are less vehicles miles travelled (VMT), reducing both fuel consumption and operational costs.
RECENT ACCOMPLISHMENTS/EFFICIENCIES
• Will soon complete construction of compressed
natural gas (CNG) station at Meadowview yard.
• Reduces dependency on non-City stations,
eliminates fuel surcharges, reduces wait times,
and increases productivity.
• Includes underground infrastructure in place for
future electric vehicle charging.
• Implemented updated GPS monitoring software to increase safety and efficiency in compliance with US DOT regulations.
RECENT ACCOMPLISHEMENTS/EFFICIENCIES (cont’d)
• Have Converted approximately
85% of collection fleet to CNG
• We will be ordering an electric
side loader for testing and
evaluation.
• New collection vehicles are
equipped with on-board scales to
reduce overweight vehicles,
further reduce VMT, and increase
time on route.
• Processing Organics into compost reduces GhG emissions and is significant progress toward the City’s Climate Action Plan Goals.
• Food Waste Recycling – Residents can recycle food waste and food soiled paper into their current yard waste container beginning summer 2022.
ENHANCED SERVICES/BENEFITS
1. Drop-off; 2. Incoming
material and grinding; 3.
Composting; 4. Screening
and finishing; 5. Retail; 6.
Drainage pond and
perimeter.
• Tenant Household Junk Pickup – RSW
will offer two household junk pickup
appointments per year, and now allow
tenants to make appointments, not
just owners.
• Balancing of Solid Waste Fund relative
to tonnage increases from the
pandemic, and long term
replenishment of 90 day reserve fund.
ENHANCED SERVICES (cont’d)
• Customers will be able to receive
a free kitchen countertop caddy
for food waste with free
compostable bags and
educational material, available at
local community centers.
• Curbside used oil and filter recycling service is available by appointment • Maintenance of 4-week street sweeping service (implementation in 2022). • Diversification of fleet - electric garbage truck, narrow street sweeper. • RSW is planning a customer survey in FY2022/23 to determine customer support for a rate adjustment that would result in weekly recycling service.
ENHANCED SERVICES (cont’d)
15 GREENHOUSE GAS EMISSION REDUCTIONS FROM ORGANICS PROGRAM Organic Material Diversion Service – Greenhouse
Metric Tons of Carbon Dioxide Equivalent (MTCO2e)
• Composting of yard waste and food waste saves over 31,000 metric Tons of GhG emissions
16 GREENHOUSE GAS EMISSION REDUCTIONS FROM NEW PROGRAM
• The social and economic impact of these emission is estimated at $162 per ton.
Therefore, diverting 31,000 metric tons of GhG results in social savings of more than $5M annually.
Proposed Monthly Variance
FY2021/22 FY2022/23 FY2023/24 Total
Garbage* $1.00 $0.98 $0.96 $2.94
Recycle $0.29 $0.32 $0.33 $0.94
Yard Waste $2.44 $2.43 $2.43 $7.30
Street Sweeping $0.10 $0.10 $0.11 $0.31
Overall $3.83 $3.83 $3.83 $11.49
Proposed Rate
FY2020/21 FY2021/22 FY2022/23 FY2023/24
Garbage* $22.13 $23.13 $24.11 $25.07
Recycle $ 7.16 $ 7.45 $ 7.77 $ 8.10
Yard Waste $11.88 $14.32 $16.75 $19.18
Street Sweeping $ 1.42 $ 1.52 $ 1.62 $ 1.73
Overall $42.59 $46.42 $50.25 $54.08
FY2020/21 FY2021/22 FY2022/23 FY2023/24
Food Waste Only
(Organics) $0.00 $10.02 $11.73 $13.43
*Garbage rates based on a 64-gallon container.
17 1. April 1, 2022
2. January 1, 2023
3. January 1, 2024
Rate Effective Dates:
PROPOSED RATE ADJUSTMENT
18 PROPOSED RATE ADJUSTMENT (cont’d)
Single-Family Residential Bill 46.42$ 50.25$ 54.08$ 54.08$ 54.08$ Change from Prior Year 3.83$ 3.83$ 3.83$ -$ -$ 11.49$ Percent Increase from Prior Year 8.99% 8.25% 7.62% 0.00% 0.00% 26.98% Revenue 76,820,574$ 87,477,276$ 95,199,140$ 99,352,606$ 100,190,547$ Expenditures 82,577,444 94,626,530 92,799,117 95,657,045 99,393,164 Net Cash Flow (5,756,870)$ (7,149,254)$ 2,400,023$ 3,695,562$ 797,383$ Beginning Fund Balance 30,749,838$ 24,992,968$ 17,843,714$ 20,243,736$ 23,939,298$ Ending Fund Balance 24,992,968$ 17,843,714$ 20,243,736$ 23,939,298$ 24,736,681$ Number of Days of O&M Realized 110 69 80 91 91 Total
IncreaseFY 2025 FY 2026FY 2022 FY 2023 FY 2024Solid Waste Fund Summary Proposed Rate Adjustments
FY2021/22 FY2022/23 FY2023/24 Total
Garbage* 4.50% 4.25% 4.00% 13.30%
Recycle 4.00% 4.25% 4.25% 13.03%
Yard Waste 20.50% 17.00% 14.50% 61.43%
Street Sweeping 7.00% 6.50% 6.50% 21.36%
Overall 8.99% 8.25% 7.62% 26.98%
*Garbage rates based on a 64-gallon container.
$32.49 $33.55 $35.39
$41.05 $41.17 $44.90
$48.55 $49.75 $50.43
$58.71
$87.28
$91.54 $92.59
Rancho
Cordova
Sacramento
County
Elk Grove Stockton City of
Sacramento
Current
City of
Sacramento
Proposed
Davis Folsom Santa Rosa Napa Berkeley San Jose Oakland
19 Current and Proposed FY2021/22 Solid Waste Monthly Rate Comparison* **
SOLID WASTE REGIONAL RATE COMPARISON
* Comparison is based on the cost of one 64-gallon garbage container, recycling container, and yard waste container. ** Rates do not include Street Sweeping.
20 SACRAMENTO UTILITY RATE ASSISTANCE (SURA)
• $3.78M current annual budget
• Participants receive discounted
rates for water, wastewater, and
recycling and solid waste services
• Customers must renew every two
years either with City or SMUD
• SURA Program managed by
Department of Utilities
• Approximately 8,500
participants as of 9/30/21
CUSTOMER OUTREACH
Customer Outreach was conducted in the
Fall of 2021. Customers were provided rate
adjustment notice by mail:
• ~138,000 notices were sent to
customers
• Printed and online instructions
for accessing information in
English, Spanish, Chinese,
Russian, and Vietnamese
• Informational flyer provided to
customers with a Spanish
translation posted to website
CUSTOMER OUTREACH (cont’d)
• Both RSW and City 311 have contracts that allow us to use Language World (a local interpretation services
company) to provide on-call interpretation services
• Social media posts on the rate adjustment and hearing were posted to our Twitter, Facebook, and Instagram.
CUSTOMER OUTREACH (cont’d)
Outreach Methods (cont’d)
• Dedicated webpage describing the
Organic Waste Program
• cityofsacramento.org/organics
• Community meetings
• Over 30 meetings with
Neighborhood Associations and
interested organizations and
environmental groups.
IMPACTS IF RATE IS NOT APPROVED
• Recycling and Solid Waste Fund will fall below 90-day reserve in FY 2022/23 and will become insolvent by
FY2025/26
• Future rate adjustments will need to be larger to recover from deficit and establish a prudent operating reserve
• City would face regulatory penalties for failing to comply with SB 1383
• Refuse vehicles will not be replaced on schedule and
maintenance costs will increase
• Service day interruptions for customers
• Overtime costs will increase
SUMMARY
• This rate adjustment was presented to the City’s Utility Rate Advisory Commission (URAC), including two presentations and a public hearing
• URAC approved the rate adjustment by unanimous vote
• The City received a total of 195 validated written protests, which is approximately 0.15% of our customer base
• More than half of this rate adjustment is to comply with Senate Bill 1383 and implement the Recycling Solid Waste Division’s contribution to the City’s Climate Action Plan
• The remaining portion of the adjustment is to address the inflationary increases noted, and for anticipated increases in wages under our next labor agreement.
SUMMARY
• Failure to implement the program would result in regulatory issues and enforcement from the State. Ultimately the City would still end up implementing the program, but at an even higher cost since the compliance process is costly.
• The proposed program completes the ‘fork to farm’ loop. We are the ‘farm to fork’ Capital and now our food waste will actually be recycled and reused as soil amendments and compost.
• The City has an active rate assistance program - SURA for qualifying customers needing assistance.
• This rate adjustment is in line with similar rate adjustments being implemented all over California to comply with the new law Questions?
27