Charlotte, N.C.’s City Council is considering a proposal to make garbage “free.” If it is approved, homeowners would swap their current yearly waste fee for a property tax increase. Of course, garbage and recycling would not be “free.” Homeowners and apartment owners would see their property taxes rise to replace the lost fees. Charlotte’s residents would also lose the opportunity to know what they are paying for these services.
Many local governments hide the cost of waste and recycling services in property taxes. Fortunately, they are in the minority. The majority of municipalities either have their hauler bill residents directly for these services or they charge a separate fee that is designed to cover all of those costs. In those communities, people know when they get their bill that garbage isn’t free and recycling isn’t either.
Yet the lure of “free” is powerful, especially for recycling. Most people accept the fact that garbage collection and disposal costs money. Yet some people seem to believe that recycling is automatically a moneymaker. They believe their hauler can sell those recyclables and surely that revenue is more than the cost to collect and process them. If only life were that easy.
Their hauler—and it doesn’t matter if it is the private sector or the public sector—has to pay for the crew and the equipment used to collect and process those recyclables. They also have to cover all of the other costs associated with running a business. Yes, the paper, cans and bottles you put on your curb have value. But rarely is that value enough to cover those costs. After all, if our old newspapers or plastic bottles were really valuable, we would sell them ourselves.
To make matters worse, recyclables are commodities subject to the same fluctuations in market values as all other commodities. One of the unfortunate realities about recyclables, however, is that their market values fluctuate more widely than most other commodities. And those highs and lows are unpredictable.
As a result, haulers are faced with costs that are relatively easy to predict and revenues that are very unpredictable. When prices are good, revenues are good and recycling programs are financially stable. When markets are down, so are revenues and recycling programs are stressed.
We are now going through the fourth big downturn in market value in the last two decades. This is not the worst of those downturns, but it has not been pleasant and is likely to last throughout this year.
Recycling will weather this crisis, but it won’t be fun. The good news is that we have advantages now that we did not have before. One is the guidelines jointly issued by the National Waste & Recycling Association and the Solid Waste Association of North America to help local governments and private companies contract for recycling services while taking into account the risks of fluctuating commodity markets.
Another is the recent webinar on the cost of recycling conducted by Waste360 . Featuring Michael Timpane, and Bill Moore, two long time experts in recycling, the webinar gives a thorough look at the costs involved in collecting and processing our recyclables.
I hope the Charlotte City Council doesn’t try to hide the cost of waste and recycling services. Their citizens should know what they are paying for those essential services. For that matter, I hope those City Council members take advantage of the Model Procurement Contract and listen to the webinar. Then, I think, they will be able to make the right decision.
Chaz Miller is director of policy/advocacy for the National Waste & Recycling Association, Washington, D.C.