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Home My WebLink AboutIR 6963 ' INFORMAL REPORT TO CITY COUNCIL MEMBERS No. �•"""�o August 21 1984 �oEFOary,A To the Mayor and Members of the City Council IDENTIAL AND rEX°' Subject: PROPOSED RATE ADJUSTMENTS FOR RESIDENTIAL CONAffU�CIAL REFUSE COLLECTION SERVICE The following information is provided relative to questions asked by the City council regarding Solid Waste operations, the Solid Waste Fund, and the proposed rate adjustments for residential and commercial refuse col- lection service in the 1984/85 Proposed Budget: I. Following the consultant's study in 1981 and implementation of the recommendations including contracting, it was believed that re- quired Solid Waste funding would be such that collection fees would not have to be increased and could even be reduced. In September, 1981, Ecodata, Inc., provided the City with a study for improving the productivity of solid waste management in Fort Worth. At the time of the study, the monthly fee to each household for twice a week pickup and disposal of unlimited quantities of refuse containerized in one-way containers and once a month pickup and disposal of unlimited quantities of brush and bulky waste was $3.50 for curbside service and $10.00 for carryout service. The actual 1980/81 costs to the City were determined to be $6.05 per household per month. The difference between the costs of collection and disposal and the revenue derived from col- lection fees was made up from the General Fund. Effective October 1, 1981, collection fees were increased to $4.50 for curbside service and $11.00 for carryout service. - Although Ecodata, Inc. , in its 1981 study indicated that collection and disposal costs were about 30% less than might be expected for a city like Fbrt Worth, a number of recommendations were proposed and subse- quently implemented to improve the City's collection and disposal ser- vices. The recommendations basically related to contracting out a por- tion of the City's service to the private sector and making internal modifications to the municipally provided service. A landfill contract was awarded in February, 1982, and two collection contracts were awarded in March 1982 and September 1982 to provide collection service for ap- proximatley 40% of the City. Internal improvemetns included changes in work schedules, staffing, equipment, and supervision. The following tables indicate the impact of those changes on the Solid Waste Manage- ment Division's budget, staffing, and equipment. SOLID WASTE EXPENDITURES Actual Actual Estimated Proposed 81/82 82/83 83/84 84/85 Administration 425,598 1,263,546 840,450 1,044,352 Collection 5,273,406 5,817,180 6,593,820 7,528,365 Brush 1,137,071 784,299 1,133,427 1,098,111 Landfill 1,527,182 769,627 787,338 940,790 Plastic Bags — -- 637,056 922,036 Dept. Support 663,285 683,288 — — TOTAL $9,026,542 $9,317,940 $9,992,091 $11,533,654 ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS — INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6963 - p.2 H,,$1 T i q,0 ~Dfj 019J� To the Mayor and Members of the City Council August 21, 1984 Q., V\{iV/= raxAy. Subject: PROPOSED RATE ADJUSTMENTS FOR RESIDENTIAL AND .T COnIERCIAL REFUSE COLLECTION SERVICE SOLID WASTE STAFFING 81/82 82/83 83/84 84/85 Administration 6 9 5 5.5 Collection 234 122 117 119.0 Brush 31 26 21 21.0 Landfill 23 4 4 5.0 Plastic Bags -- - 2 2.0 TOTAL 294 161 149 152.5 SOLID WASTE EQUIPMENT 81/82 82/83 83/84 84/85 Rear Loaders 61 0 0 0 Side Loaders 36 37 37 38 Container Veh. 5 5 5 5 Brush Booms 8 7 6 6 Brush Open Beds 26 18 13 13 Landfill (983's) 11 11 1 1 C� TOTAL 147 68 62 63 Effective October 1, 1982, collection fees were increased to $5.50 for curbside service and $12.00 for carryout service. The increase in fees was required in order to establish solid waste collection and disposal operations as a self-supporting enterprise totally funded by user fees. The 1982 fee adjustment allowed the Solid Waste Fund to finance collec- tion and disposal operations in 1982/83 and 1983/84. Although signifi- cant improvements have been made to control costs and increase producti- vity, the costs to provide collection and disposal services are in- creasing. The following represents sane of the significant increases from 1982/83 to what is being proposed for 1984/85: Actual Reest. Proposed Expenditure 1982/83 1983/84 1984/85 Pers. Svcs (Less Workers Comp, $2,461,901 $2,395,559 $2,578,142 Health Ins., Ret. Ins.) Workers Compensation 179,172 372,774 662,027 Health Insurance 147,450 162,410 193,743 Retiree Insurance --- --- 68,820 Wd. Cust. Bill 226,105 220,000 250,000 Gen. Fund Charges 223,222 356,406 472,005 Depreciation 486,528 1,247,595 1,248,414 Collection Equipment 52,115 --- 136,645 ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6963 - H,.P Tiq,p ~offORTep To the Mayor and Members of the City Council August 21 , 1984 rexA� Subject: PROPOSED RATE ADJUSTMENT'S FOR RESIDENTIAL AND COMMERCIAL REFUSE COLLECTION SERVICE The proposed rate adjustment is required to provide for these increasing costs. II. If the City's monthly cost to provide solid waste collection and disposal services is $4.70, why do residential collection fees need to be increased from $5.50 to $6.50? Through the Third Quarter 1983/84, the average monthly cost for City forces to provide garbage collection, brush collection, and disposal services for Solid Waste customers was $6.79. A portion of the diffe- rence between the $6.79 cost for the City to provide collection and dis- posal services and the $5.50 fee that is charged the custammer is offset by the $4.00 charge by the contractor to provide collection services to approximately 50,000 Solid Waste custoners. The remainder of the dif- ference is made up by other Solid Waste revenues such as public dumping charges, interest on investments and bag sales. The $4.70 average monthly cost to provide collection and disposal ser- vices refers to what has been calculated to be the City's displaceable cost. Displaceable costs are those_ costs which would no longer be in- incurrred by the City if the City were to contract for the . service. Those costs that have been considered to be displaceable are direct labor and associated fringe benefit costs, vehicle operating costs, and depreciation costs for garbage and brush and bulky waste collections. Displaceable disposal cost is the cost per ton to the City for the land- fill operator to handle. refuse collected by City forces and transported to the landfill. In order for the City to experience any cost savings from contracting, bids (including any technical adjustments) mast be less than or equal to the displaceable costs for the City. Displaceable costs have been calculated for Districts #5 and #9 (see Attachments II and III) . They are $4.59 and $4.77 respectively. III. What are the alternatives to the proposed rate adjustments for residential and commercial refuse collection? Alternatives to the proposed rate adjustments were submitted as Solid Waste Management Division decision packages and include the following: 1. Change to once weekly garbage collection. It is estimated that $160,000 could be saved in reduced fuel and equipment costs. It is believed that increased litter and refuse would result on City streets. It is also estimated that as many as 60,000 customers would have their scheduled collection days changed. (Decision Package #2) . ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS --- INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6963 - p. 4 Np kT IOV, August 21, 1984 To the Mayor and Members of the City Council rexPy. Subject: PROPOSED RATE ADJ[JSTMUITS FOR RESIDENTIAL AND CONVERCIAL REFUSE COII=ION SERVICE 2. Discontinuation of monthly brush and bulky waste collection and cleanup of illegal dumpsites. The estimated savings will be $1,098,111. Collection and disposal of brush and bulky waste would become the responsibility of the waste genera- tors. More illegal dumping and litter on streets are likely to result (Decision Package #3). 3. Discontinuation of five permanent positions and reduction of funds for vacation relief. Estimated savings will be $143,717. Supervision and auditing of customer accounts would be negatively affected and White Wing crew in downtown and Stockyard areas would be eliminated (Decision Package #4). 4. Elimination of additional residential collection vehicle and one-half year funding for additional collection crew required to accomrodate growth in Southwest Fbrt Worth. Estimated savings will be $133,053. Increased overtime and possibility of not being able to maintain the current level of service would likely result (Decision Package #5). J 5. Eliminate updating of three container collection vehicles with hydraulic lifts. Estimated savings will be $56,500. Conti- nued high downtime of equipment is likely as well as continued exposed of crews to dangerous situations (Decision Package #6). 6. Elimination of overtime funding for brush and bulky waste crews. Estimated savings will be $38,370. Thirty-lay brush and bulky waste cycle may not be able to be maintained and cleanup of illegal dumpsites may not be as timely (Decision Package #7). 7. Elimination of additional Scalehouse Operator at landfill. Estimated savings will be $12,381. Increased overtime costs and reduced revenue at landfill will likely result because of excessive wait by citizens wanting to use the landfill (Deci- sion Package #8). 8. Elimination of contingency funds in the amount of $25,000 for outside engineering services for the City's open and closed landfills. Services usually relate to Texas Department of Health and compliance with State regulations (Decision Package #10). 9. Elimination of $25,000 funding for 3,000 feet of fencing to secure the City's closed Northeast landfill as required by the Texas Department of Health rules and regulations (Decision Package #11). ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 6963 - p. 5 �,JITIA,0 August 21, 1984 poi fOR? To the Mayor and Members of the City Council rBxP`�� Subject: PROPOSED RATE ADJUSTMENT'S FOR RESIDENTIAL AND "" COMMERCIAL REFUSE COLLECTION SERVICE 10. Request proposals from private contractors to provide solid waste collection and disposal services for additional dis- tricts now serviced by the City. Based on the estimated dis- placeable costs for Districts #5 and #9 and the City's current contract costs, projected annual savings would be $103,275 and $127,576 respectively. An approach the Council might wish to consider which could have the ef- fect of reducing the required residential rate increase from $1 per month to 75� per month would entail a combination of several of the al- ternatives described above: ° Contract out districts #5 and #9 (savings of $130,000); ° Delete contingency engineering funds (savings of $25,000); Defer fencing for Northeast Landfill (savings of $25,000); Defer updating of three collection vehicles with hydraulic lifts (savings of $56,500); and, ° Delete funding for an additional collection vehicle . (ravings of $80,000) . Several important factors would need to be considered before making the decision to contract out more districts. First, there is no way to be sure of the cost savings to be derived from contracting; bids would need to be solicited and reviewed before an accurate estimate could be made. Second, personnel displacement considerations would also need to be weighed. Finally, the advisability of contracting a larger portion of the City to private contractors should be evaluated. If additional information concerning the Solid Waste Fund is needed, it will be furnished upon request. lmbert L. LH=h'er—� City Manager RLH:kcnn ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS --