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EPWM:CP:TD:sm:srtonfee
Council Meeting: August 2, 1994 Santa Monica, California
AUG 0 2 1994
TO: Mayor and city Council
FROM: City staff
SUBJECT: A Resolution Establishing a Monthly Refuse Tonnage
Surcharge on Private Refuse Haulers serving the
Commercial/Industrial Areas within The City
INTRODUCTION
This report recommends that the City Council pass a resolution
imposing a monthly tonnage surcharge of $13.35 per ton on all
refuse collected by private haulers from the commercial and
industrial districts within the City. This surcharge will help the
City finance continued waste-diversion compliance methods
associated with AB 939, the Solid Waste Management Act of 1989, as
well as help fund the expansion of city-sponsored recycling
programs in the commercial and industrial areas.
~ACKGROUND
On January 1, 1990, the Solid Waste Management Act of 1989 (AB 939)
became law. This law requires, under penalty for noncompliance,
that each City in the state reduce its 1990 base-year generation of
solid waste by 25% as of January, 1995 and by 50% as of the year
2000. The city of Santa Monica has for several years operated an
aggressive solid waste diversion program. The additional waste
diversion efforts in the commercial sector will build upon and
expand these existing efforts.
AUG 0 2 199't
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DISCUSSION
Despite the successful expansion of our waste-diversion efforts,
the city has achieved to date an approximate 14% waste diversion
rate. In order to increase this to the 1995 state-mandated 25%
rate, two areas need enhancement: Our public education and
outreach activities must be significantly increased; and the Santa
Monica Recycling Program must be expanded into the commercial and
industrial areas. A Waste Generation Analysis conducted in 1989
indicated significant diversion potential in this sector,
especially with the commodities of mixed paper and cardboard.
Thus far, all the costs of Santa Monica's waste diversion efforts
have been borne solely by City-serviced customers. Those customers
in the commercial and industrial sector who choose to subscribe to
private hauler service are not obliged to pay any of the charges
associated with the city.s overall environmental program efforts
designed to achieve state-mandated waste diversion goals. This has
resulted in giving private haulers a competitive advantage in
setting lower rates and in limiting the city's fiscal ability to
sustain and expand waste diversion programs.
In order to correct this situation, on July 12, 1994 the Santa
Monica city Council amended Municipal Code section 5.08.430(f) to
provide for imposing a fee surcharge on private refuse haulers
serving the commercial industrial sector. The attached resolution
which is presented for Council adoption will implement this fee on
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private refuse haulers.
Many other cities within the state have promulgated surcharges on
private haulers to help finance AB 939 compliance efforts. These
surcharges usually take the form of a percentage of monthly
revenues collected by individual private haulers. In a meeting
held last year with private waste hauler firms serving Santa
Monica, representatives from these firms expressed their preference
for a monthly "tonnage-based-surcharge" in lieu of a total revenue-
based surcharge similar to what they pay in other jurisdictions.
city staff concurs with this methodology for computing the
proposed surcharge. To establish a fee structure which generates
revenue sufficient to finance the expansion of recycling programs
into the commercial/industrial sector, staff is recommending a
$13.35 per ton surcharge on all refuse collected by private haulers
servicing the commercial/industrial sectors within the city.
Private haulers will be required to submit total monthly tonnage
reports to the Solid Waste Division along with the commensurate
payment. All permitted private haulers in the City have been
notified by letter regarding the proposed surcharge resolution.
FINANCIAL/BUDGE,:/? IMPACT
Assuming a total projected volume of 36~OOO tons per year, the
projected annual revenue from this new surcharge is approximately
$480,000. These revenues will be deposited in revenue account 27-
500-441-00000-0529-10000. Staff has determined this amount to be
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adequate to fund City-sponsored recycling services for the
customer-base serviced by the private refuse haulers as well as to
support the administration of AB 939 compliance and expanded
public education and outreach programs in those areas. The
recently adopted budget for FY 1994-95 projects total revenues of
only $354,000 from this surcharge due to the delay in its
implementation until October 1, 1994. Staff has analyzed the
$354,000 revenue projection and recommend it be increased by $6,000
to $360,000 which will more accurately reflect the proposed revenue
stream.
RECOMMENDATION
It is recommended that 1) the city council adopt the attached
resolution establishing a surcharge of $13.35 per ton on all refuse
handled by private refuse haulers servicing commercial and
industrial customers in the City, and 2) increase the revenue
budget at account 27-500-441-00000-0529-10000 by $6,000 for a total
of $360,000.
Prepared by: Craig Perkins, Director, Environmental & Public
Works Management
Tom Dever, Solid Waste Operations Manager
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RESOLUTION NO. 8800
(CITY COUNCIL SERIES)
A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF SANTA MONICA ESTABLISHING
A SURCHARGE FEE ON PRIVATE REFUSE
HAULERS SERVICING THE COMMERCIAL AND
INDUSTRIAL SECTORS
WHEREAS, Municipal Code Section 5.08.250 allows a monthly fee for
general City Sanitation services to be set by resolution; and
WHEREAS, Municipal Code Section 5.08.430(f} allows for the
establishing of a refuse service surcharge on private refuse haulers
serving the commercial and industrial sectors; and
WHEREAS, a study has determined that sanitation service fees must
be established and revised in order to promote waste diversion efforts
and recover all city costs for providing sanitation services; and
WHEREAS, the fees established by this resolution are no more than
necessary to recover the costs of the services provided,
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES
RESOLVE AS FOLLOWS:
section l. A monthly refuse surcharge of $13.35 per ton will be
assessed on all private refuse haulers operating within the City as of
October 1, 1994.
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Section 2. The city Clerk shall certify to the adoption of this
Resolution, and thenceforth the same shall be In full force and effect.
APPROVED AS TO FORM:
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MARSHA J . S MOUTRIE
city Attorney
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Adopted and approved this 2nd of August, 1994
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I hereby certify that the foregomg Resolutlon 8800 (CCS) was duly adopted at a
meetmg of the City Council held on the 2nd of August, 1994 by the followmg vote.
Ayes; Councllmembers' Abdo, Gerner, Olsen, Rosenstelll,Vazquez
Noes; Councllmembers Holbrook
Abstam: Councllmembers None
Absent Councilmembers: Greenberg
ATTEST'
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