Residential Rates

The residential rate paid by a resident of Allen to the City of Allen for typical solid waste and household hazardous waste (HHW) services is currently $15.59 per month and there is no proposed change to this rate.

Residential rates paid by the City to Community Waste Disposal (CWD), the City's franchised waste services provider, are subject to the following annual rate adjustments:

An annual Consumer Price Index (CPI) increase.

• The Department of Labor CPI for the one-year period ending March 2019, showed a CPI increase of 2.7%.  This CPI translates to an increase in the City's monthly payment to CWD for residential services of $0.20 per month per home served.  As part of the contract negotiations for CWD's contract extension in October 2018, they offered a $0.25 per month residential cost reduction on June 1, 2019.  Combining these results of the CPI increase and the contract cost reduction, results in a net decrease in payment by the City to CWD of $0.05 per residential account per month.

• The CPI increase does increase the payments to CWD for each additional trash poly cart by $0.12 per month, and for each additional recycle poly cart by $0.06 per month. 

• The total 12-month cost adjustment for CWD payments due to CPI and contractual adjustments is a decreased solid waste enterprise fund expense of about $13,610 in the next 12-month period. 

• The CPI adjustment also applies to reimbursement for lost 95-gallon poly carts. The new replacement cost increased by $2.16 bringing the cost to $82.12 for replacing a lost cart.  Carts requiring replacement by CWD for "fair wear and tear" are made at no expense to the customer.

The City discounts the current waste services rates (trash, recycling, and HHW) by 20 percent for senior citizens beginning at age 65.  The proposed Rate Resolution reflects the continuation of this discounted cost.  This savings currently generates about $90,792 in annual cost savings to 2,450 Allen seniors that have signed up for the program.

By keeping the residential rates for additional recycle carts that the City has charged the same since June 1, 2010; residential accounts with additional recycling carts pay the City $0.17 monthly less than CWD is paid for the service.  This amount is $2.04 per year per extra cart; and $1,795 per year to the Solid Waste Fund for all 880 additional recycling carts the fund provides to residential customers.  

  
The City has also held residential rates for additional trash carts the same since June 1, 2010.  However, since we currently charge residential customers $8.89 while paying CWD $4.43 per month; no deficit has arisen in the case of additional trash carts.  About 2,105 additional trash carts are currently charged per month.

Commercial Rates

There are no proposed changes to commercial waste services fees in the proposed Rate Resolution.

CWD directly bills commercial waste services to the customer.  CWD provides a 15% franchise fee payment to the City from the funds they collect.  The City programs these payments to help fund operational street maintenance to offset the wear and tear caused by commercial waste vehicles on the streets of Allen. 

The City's contract extension with CWD did change to allow implementation of commercial CPI rate adjustments beginning on June 1, 2020.  The City's June 1, 2020, rate resolution will reflect this CPI adjustment. 

Commercial rates can also be affected by changes in the disposal cost component charged by the North Texas Municipal Water District (NTMWD).  NTMWD's solid waste disposal rates leveled out at $38.25 per ton and will continue at this level at least through 2020.  Therefore, there was no need to consider a disposal cost adjustment that would have increased commercial rates this year.

The old CWD contract allowed for a Variable Fuel Adjustment Fee (VFAF).  However, the City and CWD dropped that provision when the CWD contract was extended through May 31, 2024.  

New Cost Lines Added

There are several additional service lines and fees added to the rate resolution.  All changes are highlighted in yellow on the resolution copy attached.  The changes appear below in the order that they are presented in the highlighted rate resolution.  They include:

• Under Paragraph 1; Residential Solid Waste Services.  Payments by the City to CWD were adjusted per the CPI increase and the $0.25 residential cost reduction that happens June 1, 2019, due to contract extension provisions. 

• Under Paragraph 2; Commercial Solid Waste Services

  •   First Paragraph.  The term "Trash" poly carts was added to assure trash and recycling poly carts were distinguished in the rate resolution.

  • First Paragraph on Page 3.  The terms "Trash/Construction Waste" was added to improve clarity of what was placed in these rolloff containers.

• Under Paragraph 4; Commercial Special Services.  

  • The paragraph title was changed to Commercial Special "Recycling" Services to improve clarity. 

  • Costs for five and six pickups per week of commercial 8 cubic yard front load cardboard recycling containers were added.  Increased demand and customer collection schedules drove the addition of five and six pickups of these recycling containers per week. 

  • A cost for weekend collection of commercial rolloff recycling containers was added.  Weekend collection of these containers for trash have always been at a slightly higher rate and that was reasonable to apply to recycling.  

  • Trip charges were added for weekday and weekend missed collections.  These are applied when the customers recycling rolloff compactor container is not available or ready for collection by CWD when the truck goes by the facility.  The charges established are the same as trip charges for rolloff compactor containers that carry trash.  These trip charges should have been previously included. 

• Under paragraph 5; Commercial Special Services.

  • The cost to unlock gates was listed twice previously at the same cost.  One of those two listings was deleted. 

     

The attached CWD letter requesting the rate adjustments has an enclosure that reviews residential compost costs. This calculation goes back to when the City ceased providing finished compost at the Jupiter Park sports field.  The math on that program essentially tells us that the CWD payment reductions we generated by stopping that program have all been paid back to the City since 2013.  

Summary

The strength of the Solid Waste Fund's fund reserve and projected revenue and expenses allows the City to maintain current commercial and residential waste services rates to customers.  The cost for replacing lost trash or recycling poly carts does go up by the CPI increase.  The adjustments on the proposed resolution reflect the adjustments to CWD payments from the City for residential charges.  Our last residential rate increase for typical services (one trash and one recycle cart) was on June 1, 2010.

Staff projects that the residential rate changes will reduce Solid Waste Fund expenses for current residential accounts by about $13,000 in the next 12-month period.  The Solid Waste Fund will maintain its fund reserve between 90 and 120 days of reserve through the end of FY19.  The fund's positive financial outlook and ability to provide services at stable costs is assisted by NTMWD's ability to provide level disposal costs to their five Solid Waste system member cities.

Staff recommends that the City Council adopt a Resolution establishing rates and fees for commercial and residential solid waste, recycling, and household hazardous waste services.

I make a motion to adopt Resolution No. _______________ establishing rates and fees for commercial and residential solid waste, recycling, and household hazardous waste services.