Increasing landfill fees driving proposed sanitation rate increases
Rising landfill costs are largely driving the proposed city sanitation rate, according to the Public Works Department.
The city has 15,149 residential customers and 1,973 commercial customers. Of city residents, 4,679 are customers of Montana Waste Systems.
Jim Rearden, public works director, presented a review of the sanitation department and the proposed rate increases during the City Commission work session on Tuesday.
The monthly residential rates is currently $11.51. Public Works is proposing a five percent increase to $12.09 per month.
Staff recommending 5 percent increase for residential sanitation rates, commission to set public hearing
Montana Waste System customers in the city pay $10.46 monthly.
The city monthly residential rate in Billings is $10.71; Helena’s is $14.98; Havre’s is $15.38; Kalispell’s is $23.96. Missoula does not offer municipal trash pickup and the private company’s monthly rate for residential is $28.80, according to data collected by city staff.
The private rate for Montana Waste in Black Eagle is $11.23 and $23.86 in Belt. The private rate in Kalispell is $15.95 and in Bozeman it’s $21.55.
The city closed its landfill in 1991 and has been in agreement with Montana Waste since 1992.
The 10 year average annual increase is 1.97 percent
The agreement was renewed in January for eight years with two five-year optional extensions. The agreement included a 3 percent increase with no Consumer Price Index added and 2018 includes a 2.5 percent increase with a maximum CPI of 1.5 percent. The remaining six years of the agreement will follow the November CPI increase.
The residential rate in 2007 was $8.97 per month. In the years since, there were no increases in 2009, 2011, 2012, 2013 or 2016. The 10 year average annual increase was 2.85 percent The rates were last increased in 2015.
The senior rate is proposed to rise from $8.01 to $8.41 monthly.
The city’s sanitation customer base has been growing since at least 1994 when it had 11,700 residential customers.
Rearden said that the each of the city’s sanitation employees serve roughly 900 customers each.
Since 2013, the city has been converting part-time sanitation workers to full-time due to health insurance requirements and Rearden said it’s actually cheaper for the city and easier to schedule.
Personnel costs make up 36 percent of the sanitation department’s operating costs, followed by landfill costs which made up 22 percent
Roughly $900,000 is spent annually on landfill costs, Rearden told commissioners.
The landfill cost for the city was $20.88 per ton in 2007, now it’s $25.61.
Staff has worked to reduce the cost of containers through joint purchasing agreements and by assembling the 300 gallon containers themselves, saving about $70 per container, Rearden said.
“We go through a lot of containers,” he said.
The city purchased six new garbage trucks in the last year, dropping maintenance costs by about $1.75 million through 2023, Rearden said.
The city paid about $1.4 million for the trucks.
The debt payment on those trucks comes off the books in 2023 and at that point, the city plans to purchase six more trucks to keep the fleet current and reduce maintenance costs, Rearden said.
The city’s commercial rates are proposed to remain the same, other than the commercial dumpster fee.
The city still offers cardboard recycling for commercial users at $15 per month
At one point, the city got $70 per ton of cardboard but now gets very little, Rearden said.
The city previously operated a convenience center for recycling and trash disposal, as a transfer station. The center opened in 1992 and was closed in 2012, after losing more than $1 million for the sanitation fund during that time.
Commissioners have set a public hearing for Nov. 7 on the proposed increases, that if approved, would go into effect on Dec. 1.
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