Solid Waste Management Services recommended 2015 Operating and Capital Budgets and Rates Divisional overview:
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1 January 20, 2015 Solid Waste Management Services recommended 2015 Operating and Capital Budgets and Rates Divisional overview: What Solid Waste Management Services does: Manages approximately 1 million tonnes of garbage and recyclable material annually Provides collection services within the public realm to all residents and visitors city-wide to support a clean city, including: Litter-pickup; Recycling and litter collection from 6,000 parks bins and over 8000 street bins; and 1,000 special events a year Provides solid waste collection services to City of Toronto residents, businesses, charities, institutions, religious organizations and City agencies, corporations, divisions and school boards including: Green bin, Blue Bin, garbage, bulky waste, leaf & yard waste and electronic and hazardous waste Ensures that garbage and recyclables that are collected and received at transfer stations are transported to processing and disposal facilities Ensures garbage and residual waste is safely managed including operation of the Green Land Landfill Ensures the perpetual care of 160 closed landfill sites Provides communication and education on how to participate in the City s waste management programs and to encourage diversion from landfill Solid Waste Management Services customers include: Approximately 1 million homes and businesses; 461,500 single-unit homes; 422,000 multi-unit homes 14,000 small commercial; City agencies, corporations and divisions; non-residential, small commercial and school boards; Private commercial and industrial waste accepted at transfer stations and landfill; and Other municipalities. Solid Waste Management Services Assets Over $600M seven Transfer Stations (six with Household Hazardous Waste Depots) one active landfill - Green Lane Landfill with a projected lifespan to 2029 based on current diversion rates 160 closed landfills one operating Green Bin Processing Facility one Green Bin Processing Facility under expansion one Durable Goods Recycle Centre four Collection Yards and one Litter Collection Yard /2
2 -2- Over 625 vehicles and pieces of equipment Approximately 1.6 million garbage, recycling and green bins Personnel: 1,102 SWMS employees Budget overview The Recommended 2015 Solid Waste Management Services budgets consists of: o The 2015 Recommended Operating Budget of $ million o The 10 Year Recommended Capital Plan of $ million including the 2015 Recommended Capital Budget of $ million comprised of $67.92 million carried forward from 2014 into The provision of services and programs, replacement and renewal of Solid Waste infrastructure, vehicles and equipment is funded largely through fee revenues. The Volume- Based Rate revenue is used to fund 69% of Solid Waste's operating budget, the remaining 31% is funded through tipping fees at transfer stations, revenue from the sale of recyclable material and industry stewardship funding. Rate overview The 2.25% annual increase (3% effective April 1, 2015) is being recommended for the 2015 Solid Waste Management Services Rate and User Fees. The rate increase is expected to generate approximately $6.100 million in revenue. It will balance fiscal constraints while maintaining critical progress on waste diversion initiatives, operational improvements and capital investments in good state to repair and new infrastructure. A 4% rate increase for 2015 was projected in the 2014 Rate/Budget report in order to support waste management goals. The recommended effective rate increase is only 2.25% and if approved, it will be only the fourth time the rate has increased since its implementation in Recommended 2015 Key Rates and Fees Single Family Residential Rates Bin Size Annual Rates Small $ Medium $ Large $ Extra- Large $ Bag Only $ /3
3 Residential Units Above Commercial (RUAC) Rates Bin Size Annual Rates Bi-Weekly Small $ Medium $ Large $ Extra- Large $ Bag Only $ Weekly Small $ Medium $ Large $ Extra- Large $ Bag Only $ Yellow Bag/Tag Fee Yellow Bag/Tag (each) $3.29 Multi-Residential Rates Volume Rates Base/unit Excess/yd 3 Uncompacted $ $14.08 Compacted $28.17 The annual rebate per unit for all customers above will remain unchanged at $185 Front End Collection Fees per lift Customer Type Collection Type Rate (per yd 3 ) Commercial/Non- Residential Un-compacted $11.77 Compacted $23.53 ABCDs Un-compacted $8.74 Compacted $17.48 School Board Un-compacted $9.31 Compacted $18.61 /4
4 Curbside Collection Fees per Bin -4- Annual Rates Customer Type Frequency Commercial Bi-Weekly $ Weekly $ Twice Weekly $1, Yellow bag fee (each) $3.29 ABCDs Bi-Weekly $ Weekly $ Twice Weekly $1, Yellow bag fee (each) $2.68 School Board Bi-Weekly $ Weekly $ Twice Weekly $1, Yellow bag fee (each) $2.68 Non-Residential Bi-Weekly Small $85.51 Medium $ Large $ Extra-Large $ Weekly $ Small $ Medium $ Large $ Extra-Large $1, $3.29 Twice Weekly Extra-Large $ Yellow bag fee (each) $ Tip Fees at City Transfer Stations (except Drop & Load) Customer Type Material Rate (per tonne) Commercial/ Non-Residential Waste Loads $ Recyclable Material Loads $79.57 Tire loads $ ABCDs Waste Loads $86.01 Recyclable Material Loads $39.78 Tire loads $79.57 School Boards Waste Loads $89.10 Recyclable Material Loads $39.69 Tire loads $79.57
5 -5-2. Drop & Load Fees The following current Solid Waste fees have been recommended to increase to market rates (instead of being increased by 3%), effective April 1, 2015 Drop & Load Fees at City Transfer Stations Customer Type Activity Rate (per tonne) Commercial/ Non-Residential Drop & Load $ New Fee for Clean Fill at Green Lane Landfill The following is a new Solid Waste fee not currently indicated in the Schedule that has been recommended to take effect as of April 1, Miscellaneous Fees at Green Lane, City Transfer Stations Activity Rate (per load) Sale of Clean Fill $2.00-$ Single Family Residential Rebates per household Below are the recommended new annual rebates for Single Family Residential household bins. Only one rebate will be applied per household. If more than one bin exists, the rebate for the largest bin will apply. Bin Size Annual Rebate Small/Bag Only $ Medium $ Large $ Extra- Large $ As noted above in the proposed rate charts, other recommendations include: o Introduction of fees for the sale of Clean Fill from the Green Lane Landfill o Adjustment of the transfer station Drop & Load fees to reflect market rates o Allow eligible Non-Residential customers to participate in a Waste Diversion Rate Waiver Program and a resumption of a rate charge of 100% of the commercial rate for all other Non-Residential customers that are no longer fee exempt Cost of Yellow Bags or residential garbage bag tags The proposed cost to purchase a Garbage Bag Tag for each standard-size bag of overflow garbage will increase marginally to $3.29 per tag (from $3.19 per tag). Tags are available for purchase at Toronto Canadian Tire stores. The proposed cost of a Yellow Bag for Toronto s eligible commercial and industrial customers will also increase marginally to $3.29 per bag. /6
6 -6- Why is a rate increase proposed for 2015? 2015 Program Changes include: Waste Diversion Rate Waiver Program for Non-Residential Charitable Sector, called the 'Charities Rate Waiver Program'($0.644 million), which includes revenue from ineligible customers and 6 additional staff (Council directed) for audits, 6 trucks to ensure diversion programs are in place for eligible organizations 2 additional staff for contract management support ($0.163 million) One time funding for additional litter and public space waste/recycling collection to support the 2015 Pan American/Parapan American Games ($0.100 million) How often has the rate changed in the past? If approved, this will be the fourth time the rate has increased. The residential rates were introduced in 2008 and there were zero rate increases in 2009 and The first annual rate increase of 3% was in 2011 to ensure there was sustainable revenue to support diversion initiatives and maintain adequate and reliable processing capacity for Green Bin organic material and recycling, sorting, processing and marketing. There was a 0% rate increase in 2012 and again in 2013 for the vast majority of customers. In 2014, the rate was increased by 3%. Regarding our commercial customers, the Yellow Bag fee increased by 3% in 2014, the second increase for the commercial customers serviced by the City since What the Volume-based Rate pays for Volume-based Rates support the continued roll-out of programs/infrastructure to divert waste from landfill. Diversion of waste from landfill by all solid waste customers must continue to maximize the usable lifespan of the City-owned Green Lane landfill and ensure long term disposal security. Solid Waste user fees allow for unlimited collection and processing of recycling, yard waste, organics, bulky items, electronics and white goods/metal items at no additional charge. The user fees also pay for much more than household waste services; they fund city-wide litter collection, Community Environment Days, drop-off-depots, parks bin collection, perpetual care of closed landfills, etc. /7
7 -7- What are the Operating Budget pressures for 2015? Processing contracts Volume / Price Changes - Costs to process recyclables and Green Bin collected from the City s programs are increasing by $6.687 million. Additional Contribution to Vehicle Reserve and Fleet Services Increase Staff are considering a long term plan to shorten the vehicle replacement process to better reflect the lifespan of the collection vehicles to ensure they are in a state of good repair, the 2015 Operating Budget includes a one-time $5.000 million contribution to the vehicle reserve to replace existing vehicles sooner. Green Lane Landfill recommendation to stop re-directing City garbage away from Green Lane Landfill to avoid significantly higher disposal costs. Paid private tonnage at Green Lane is also declining, resulting in higher net operating costs. What could offset these budget pressures in 2015? City of Toronto anticipates receiving an additional $5.000 million industry funding for the Blue Bin Recycling Program from Stewardship Ontario as a result of the outcome of a recent Arbitration decision and scoring higher in the funding formula. It is anticipated the funding (revenue) provided to the City by Stewardship Ontario and the Ontario Government for the collection and post-collection costs for Household Hazardous Waste materials will be lower than 2014 because the Province canceled funding for certain materials that were previously eligible and projected reduction in materials to be processed. However, the net increased funding from industry stewards allows Solid Waste Management Services to offset other costs, thus reducing the rate increases. What is the proposed change regarding the rebate for single family residents on curbside collection service? Solid Waste Management Services' recommended 2.25% annual Rate increase (3% effective April 1, 2015) will balance fiscal constraints while maintaining approved service levels and critical progress on waste diversion initiatives. A reduction in the Solid Waste Rebate (Grant) in the amount of $ million is proposed as part of the Tax Budget. As a result of this reduction, the rebate for single family customers will be revised based on Garbage Bin size, from the current rebate of $224 per customer. As a result, Single Family customers, will see a net increase on their utility bill, including the annualized rate increase of 2.25%. o Small Bin fees will increase by $3.91/yr or $0.33/month o Medium Bin fees will increase by $32.64/yr or $2.72/month o Large Bin fees will increase by $91.00/yr or $7.58/month o Extra Large Bin fees will increase by $126.39/yr or $10.53/month /8
8 -8- The changes maintain a pricing structure that encourages waste diversion and results in an average annual increase for all single family residential customers (58%). It is also a first step to a full user pay program that improves waste diversion. Currently, 75% of residents are not using the small Garbage Bin and waste audits stats show there is too much recycling, organics, electronics and even yard waste in Garbage Bins. There is room for improvement and opportunity for residents to switch to smaller Garbage Bins and thereby lower their fees. Why propose changing the rebate for these customers now? In 2015, a key priority for Solid Waste Management Services is to ensure long term sustainability of the utility. This change is an initial step toward that objective. This recommended approach maintains a pricing structure that encourages waste diversion and moves towards a full user pay system, while still providing very affordable waste collection services. It also provides an opportunity to reinforce the importance of waste diversion and encouraging customers with larger bins to divert more waste and subscribe to a smaller size bin. Why are Single Family Customers the first to experience this annual increase? After reviewing a number of options, it was determined that the most feasible approach was to begin with Single Family Residential customers. Multi-Residential customers were not considered for this initial phase because of potentially significant revenue loss, resulting from Multi-Residential customers choosing to opt out of City services. Opting out also negatively impacts waste diversion objectives because private contractors do not offer the comprehensive list of waste diversion collection services the City does. What is the impact of the proposed rate increase and changed rebate for Single Family customers? Table 2: Single Family Residential - Annual Rates Comparison Bin Size Rates Rebate Net Fee Small $ $ $ $ $6.72 $10.63 Medium $ $ $ $ $56.09 $88.73 Large $ $ $ $ $ $ X Large $ $ $ $ $ $ /9
9 Key accomplishments in Continued Green Bin roll out to Multi-Residential properties Additional 941 properties joined the program in 2014; Most of the buildings serviced are now on the program 50 new 3Rs Ambassadors recruited in 2014; Goal is to have at least one in every building (currently have over 250 trained volunteers) Lead for Ice Storm Debris Management Collected and processed 50,000 tonnes of material immediately following the storm and an additional 20,000 tonnes during Spring $15.5M SWMS portion of the costs submitted to the Province (all costs including staff overtime, Sole Sources, etc) and 85 Emergency Contracts issued Launched Long Term Waste Management Strategy To guide the Division s policy decisions for the next 30 to 50 years Disco Road Organic Processing Facility Providing additional capacity for processing Green Bin materials Contract Awards District 1 Curbside Collection & Recycling Processing Capacity Awarded Etobicoke community curbside collection to Miller Canada Fibers Limited was the successful proponent selected to operate the Materials Recovery Facility (MRF) the City uses for recycling Blue Box Funding Arbitration Successfully concluded in November resulting in a decision that awards the City an additional $4 million approximately blue box funding from Stewardship Ontario What ongoing Program opportunities and challenges can the City expect to face? Development of Long Term Waste Management Strategy in 2015 Will guide the Division s policy decisions for the next 30 to 50 years Process involves getting feedback from stakeholders and the public as input to development of the strategy Outcome is to have a Council approved Waste strategy that will guide how programs are developed Sustainable rate structure & 10 year forecast Review of rate model Cost projections from the Waste Strategy Customer Service a continued priority complaints per 1,000 households per week /10
10 -10- Green Bin Processing Capacity RFP (Request for Proposal) to construct an improved organics processing facility at the Dufferin Site Renewable Energy - Landfill gas and Biogas Studies completed in 2014, which in turn triggered the Disco Road Biogas Utilization Project. Plan to capture and use the biogas, generated as a by-product of the anaerobic digestion process used at the Disco Road Organics Processing Facility, as a renewable energy resource. Intend to use the biogas to provide heat and power to City facilities at 120 and 150 Disco Road. Key projects included in the 2015 budget Continue development of a Long Term Waste Management Strategy to guide the division's decision-making for the next years Next Generation Green bin RFP (Request for Proposal) to replace aging green bins (~12 yrs old); goal is to have a bin that is easy for residents to use, is even more rodent resistant, and can be collected with automated trucks Develop a comprehensive Asset Management Program for transfer stations/yards; closed landfills; the active Green Lane Landfill; vehicles and bins (ensure facilities and assets are maintained and replaced at the right time) Multi-Res Diversion continued focus complete rolling out Green Bin organics collection to multi-residential buildings, school boards and agencies, corporations and divisions Continue with enhanced litter collection service Both expand and maintain reliable processing capacity for organics and singlestream recycling Develop an Integrated Management System (IMS) that advocates environmental sustainability, quality and health and safety The 10-Year Recommended Capital Plan of million) provides funding of $ million within the 2015 Recommended Capital Budget for the following: Diversion Systems and Facilities ($ million); Ongoing maintenance of Perpetual Care of Closed Landfills ($8.050 million); Transfer Station Asset Management ($ million); Collection Yard Asset Management ($0.400 million); Development of Green Lane Landfill ($ million) Long Term Waste Management Strategy Plan ($1.465 million); Landfill Gas and Bio-Gas Utilization ($2.476 million); Corporate and Divisional IT Initiatives ($4.322 million); and Two-way Radio Replacement ($2.235 million) 30 Media contact: Pat Barrett, Sr. Communications Coordinator, , pbarrett@toronto.ca
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