• The comprehensive contract between the City of Vancouver and Waste Connections of Washington includes a rate-setting model that allows for an annual Inflation Adjustment Factor (IAF; a combination of the consumer price index and a fuel index), tipping fee, and adjustments to the City Fee to be applied to rates paid by customers.
• Rates paid by customers for garbage, recycling and organics collection services were last modified effective January 1, 2022 (Ordinance M-4353).
• Rate increases calculated for January 1, 2023, and detailed in the ordinance and rate summary sheet, vary based on the type and level of services provided and generally range from 8.5 percent to 9.4 percent.
• For the typical residential customer, the net impact is a 6.6 percent increase (or $2.21/month) for combined garbage, recycling and organics collection services. This is lowered in part due to a rate-buy down applied to residential recycling collection rates as a rate stabilization measure covered by the City’s Solid Waste fund balance (including past recyclable material sales revenue) in 2023 only.
• On January 1, 2023, the tipping fee for waste disposal at the three transfer stations located in Clark County will increase by 6.5 percent (or $6.46 per ton) to $106.34 per ton and this also impacts the rates that customers will pay in 2023.
• A review of the Clark County approved per ton processing fee (going from $48.56 per ton to $41.73 per ton) results in changes to the recyclables processing surcharge amounts to be paid by City curbside ($0.87/month) and multi-family ($0.42/month) customers.
• The subject ordinance amends VMC 6.12.208, 6.12.209, 6.12.210, 6.12.211, 6.12.212, and 6.12.213 to provide for increases or adjustments in solid waste rates effective January 1, 2023.

Goal 1, Objective 1.2: Ensure our infrastructure, including buildings and utilities, is safe, environmentally responsible and well maintained

City Council is the rate-making authority for garbage, residential recycling, and organics collection services within the City of Vancouver. The City contracts with a private hauling company, Waste Connections of Washington, to provide comprehensive garbage, recycling and organics collection services to residents and businesses within city limits. The contract terms authorize Waste Connections to receive annual adjustments to customer rates based on changing operating conditions including:

• an inflation adjustment factor tied to a percentage of the CPI and fuel cost changes over the past year (July through June), 
• disposal tip fee changes scheduled for the coming year,
• the number of customers served and,
• fees paid to the City to support solid waste related programs.

All adjustments to rates are made in accordance with Exhibit D of the contract. Garbage rates also include the City’s utility tax that is embedded within them. The City’s utility tax does not apply to recycling or organics collection services.

Consistent with the contract, the updated model for 2023 requires an increase of 8.5 percent for most garbage rates, while many recycling, organics and selected other fees, not linked to the disposal tip fee or utility tax, will need to increase by 9.4 percent, effective January 1, 2023. Key reasons for this increase are an 8.586 percent increase in the CPI, a 48.62 percent increase in the diesel fuel index, and a 6.5 percent increase in the disposal tip fee. For the most typical residential customer with 32-gallons per week of garbage, every-other-week recycling and every-other-week organics collection (96-gallons for each) this means a monthly rate increase of 6.6 percent, from $33.33 per month to $35.54 per month, this is a net increase of $2.21 per month.

Inflation Adjustment Factor
Under the contract, collection costs for garbage, recycling and organics adjust at 80 percent of a blended and combined CPI (92 percent) and diesel fuel index (8 percent) – Inflation Adjustment Factor (IAF), which leads to a 9.43 percent increase for the collection and disposal cost component, the City Fee and other miscellaneous fees. 

Disposal Tip Fees
On January 1, 2023, the disposal tip fee is scheduled to increase $6.46 per ton (or 6.5 percent) from $99.88 per ton to $106.34 per ton. In addition to the allowed CPI increase on the base tip fee (going from $98.08 per ton to $104.40 per ton), this tip fee includes $0.51 per ton for additional work being done under the Clark County contract by Columbia Resource Company at the Central Transfer and Recycling Station ($0.14 of this is new for 2023 related to construction access improvements for safety) as well as $1.43 per ton for a surcharge approved by the Clark County Council in 2017 to make up for lost state funding for regional solid waste programs and planning. 

Recycling Fees
The rates proposed for January 1, 2023, include a subsidy or rate-buy down of $0.72/month per household paid to Waste Connections from the City’s Solid Waste Fund to support curbside recycling service provided to individual households (adjusting customer monthly charges from the current fee of $3.37 to $2.97, an 11.9 percent decrease).The multi-family recycling collection service fees (increasing from $1.36 to $1.49) are based solely on the Inflation Adjustment Factor detailed above, without a subsidy, as well as annual adjustments to the recycling processing surcharges, which were added April 1, 2019 to recover costs associated with the local response to the global market issues and the ongoing need for supplying quality materials to these markets. Based on a review of operational factors, Clark County has indicated that the $48.56 per ton processing fee in 2022 will be adjusted to $41.73 on January 1, 2023. The combined impact for the combined curbside recycling fee and processing surcharge components is an 8.3 percent decrease ($0.34 per month) in curbside recycling charges. The multi-family combined impact for the recycling fee and processing surcharge is an increase of 15.7 percent ($0.26/mo).

Organics Fees

The rates proposed for January 1, 2023, include 9.4 percent adjustments to the organics rates which are tied to the Inflation Adjustment Factor. For the standard subscription service of 96-gallons collected every-other-week, the current rate of $8.05 per month adjusts to $8.81 per month. Recommended 2023 rates at other levels of service, following the same every-other-week schedule, are $7.62 for 64-gallon carts, $6.44 for 32-gallon carts, and $5.25 for 20-gallon carts.

Contractor Performance

During 2022 the contractor made operational changes to garbage and recycling services provided outside of Vancouver’s city limits that resulted in significantly increased call and email volumes to their regional Customer Service call center. These changes had a negative impact to Vancouver customers’ ability to experience the level of customer service expected in the City’s contract.  As a result, and pursuant to Section 3.3.2 of the contract (attached), City staff is currently working with the contractor on a strategy to address this performance concern so that our residents are not “left hanging” when they call in or email the company to address their service, billing or account set-up needs.

Typical Residential Rate Impact

For 2023 overall, the combined typical residential customer rates for 32-gallons of weekly garbage service with recycling and organics collection increases 6.6 percent or $2.21 per month under the proposed rates. This reflects a $1.79 increase in garbage charges, a net $0.34 decrease in the combined recycling collection rate and recycling processing surcharge fees, and a $0.76 increase in the organics charge. Households that have chosen different service levels may experience slightly different rate impacts.

Staff recommends adjusting customer rates as detailed in the Summary of Proposed 2023 Solid Waste Rates to meet the contractual obligations associated with the defined Inflation Adjustment Factor and anticipated tip fee changes and to set the City Fee amount for the coming year. If approved, all adjustments will be effective January 1, 2023.

1. Increasing customer rates maintains the City’s high level of solid waste services including many different options for curbside collection of garbage, recycling and optional organics.
2. The recommendation continues to provide funds for the neighborhood cleanup programs including spring yard debris coupons and fall leaf coupons, Curbside Bulky Item Pickup or Saturday cleanup events and Saturday chipper events, as well as neighborhood mini grants.
3. Assures funds for addressing solid waste code compliance and litter abatement and illegal dumping response across the City. 
4. Provides funds (through included tip fee element) for regional Solid Waste programs for administration of the solid waste transfer and disposal system, long-term solid waste management planning, as well as education and outreach.