HomeMy WebLinkAboutIR 089 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 22-089
To the Mayor and Members of the City Council June 21, 2022
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* rrn SUBJECT: RESIDENTIAL SOLID WASTE RATE AND REVENUE HISTORY
In April of 2003, the City of Fort Worth transitioned from collecting residential trash using a manual collection
method serviced by City staff, to a fully automated "pay as you throw" collection system utilizing 32, 64 and
96 gallon containers with contractual services provided by Waste Management (WM). There were three rate
increases that occurred as part of the transition and adjusting service levels to community demands. In 2014,
there was a rate reduction for 32 and 64 gallon carts to pass along contractual savings and promote the use
of smaller carts (less waste and more recycling):
Year 32 Gal 64 Gal 96 Gal Explanation
2003 $8.00 $13.00 $18.00 New Automated System
2004/06 $12.75 $17.75 $22.75 Bulk & Yard Waste Collection Improvements
2014 $12.50 $17.50 $22.75 Passed Contract Savings to Rate Payers
Rate increases were discussed in 2009; however, the nation was still in a recession and it was decided to
forgo the increase and instead attempt to keep costs down by forgoing capital expenditures and program
expansion. To the credit of operational staff with the City and WM, this worked.
In 2013, the City worked with WM to make contract adjustments to better align with service delivery
demands/costs. WM also agreed to extend the recycling processing contract without changes (it was
recognized as one of the best municipal contracts in the nation). Lastly, landfill revenues were up because
of increasing volume at the landfill (however, the life of the landfill was and is still diminishing as a result).
The processing contract was competitively re-bid in 2018 and Republic Services offered the best value. While
it was the best value, it was still considerably higher than the previous contract which was based on outdated
volume assumptions of newsprint, paper, etc. which dropped off greatly with the expanding digital market.
Nationally, during this period, all processing contracts went up significantly.
For a number of years, the City went from a positive cash in the millions to a net cost because of increased
processing costs and a global recycling market decline (China's Green Fence). The loss of recycling revenue
and increase in costs, along with inflationary costs over time to all cost centers, resulted in a negative cash
flow for the fund. The City was able to reduce the deficit by adding an environmental fee at the landfill,
increasing the grant of privilege fee, and increase the fee for commercial carts and bulk waste abatement.
With the global deficit of raw material, recycle markets have rebounded and the City is once again seeing a
positive cash flow. In FY 2021, the City saw a positive cash flow of $782,486 which has helped the fund
operate in a balanced mode. However, recycle markets are volatile and industry experts are predicting a
short uptick and then decline. This, along with the inflationary increases to our contracts (higher fuel, higher
wages, labor shortages, etc.) means that we still need to grow revenue streams in the fund.
Earlier this year, staff updated City Council on a number of revenue options that are currently being
developed. One is increasing the environmental fee at the landfill and the other is mining gas from the landfill.
Staff are working with industry partners and will be updating Council after the summer break. For questions,
please contact Brandon Bennett, Director of the Code Compliance Department, at 817-391-6322.
David Cooke
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS