SR-01-14-2014-8ACity Council Meeting: January 14, 2014
Agenda Item: B - A
To: Mayor and City Council
From: Martin Pastucha, Director of Public Works
Subject: Resource Recovery & Recycling Rate Study and Adoption of Zero Waste
Strategic Plan
Recommended Action
Staff recommends that the City Council:
1. Adopt the Zero Waste Strategic Plan to achieve 95% diversion from the landfill
by 2030.
2. Approve a three year plan to increase Resource Recovery & Recycling service
rates and the establishment of a 5% operating reserve
3. Approve the setting of a public hearing in April 2014, in accordance with
Proposition 218, to adopt Resource Recovery & Recycling rate increases.
Executive Summary
At a Council study session on March 19. 2013, staff presented the draft Zero Waste
Strategic Plan which included various policies, programs, projected waste diversion
percentages and estimated costs which would affect existing rates if the recommended
programs were implemented over the next fifteen years. Council directed staff to
communicate the Zero Waste Plan to all facets of the community and incorporate
findings into the final plan.
At the FY 2006 -07 Council Budget Study Session on June 20 2006, Council approved
a resolution to increase solid waste rates by 7% and by a factor equal to the difference
in the Los Angeles- Riverside - Orange County Consumer Price Index (CPI) for Wage
Earners and Clerical Workers annually thereafter. No additional rate increases have
been requested to recover full costs for Resource Recovery & Recycling services since
that time.
Staff recommends that Council adopt the Zero Waste Strategic Plan to achieve 95
percent waste diversion by 2030, approve a plan to increase service rates to establish a
five percent operating reserve and set a public hearing in April 2014 to adopt the
resource recovery and recycling rate increases.
Background
On June 23, 2009, Council directed staff to develop a Zero Waste Strategic Plan. The
City began a Zero Waste Strategic Planning process to identify the new policies,
programs and infrastructure that would enable the City to reach its Zero Waste goal of
95% diversion by 2030, or a per capita disposal rate of 1.1 pounds per person per day.
The Zero Waste Strategic Plan will help the City strengthen its existing diversion
operations while addressing significant fiscal challenges and emerging trends and
technologies. The Plan will serve as a broad environmental and policy framework and
will guide the future development of the City's Resource Recovery and Recycling
policies, programs, and infrastructure.
The Resource Recovery & Recycling Division (RRR) is the exclusive provider of solid
waste collection services to residential and commercial customers. RRR recovers its
cost of operations through solid waste rate charges to customers. On June 20, 2006
Council approved a five year rate adjustment plan providing that customer rates would
only be adjusted by the Consumer Price Index, (CPI) or the Cost of Living Adjustment
(COLA) whichever is higher. If an extraordinary adjustment was necessary within the
five year period, such as unanticipated landfill disposal fee increases, the RRR Division
used its fund balance to cover the cost of the adjustment. The Resource Recovery &
Recycling rates have not been increased, except by CPI /COLA since FY 2006 -07.
Since that time the City has expanded its waste diversion programs, seen increased
costs in disposal fees, new organics processing fees, transportation fees, salaries and
benefits increases, vehicle purchases price increases, maintenance and fuel increases,
all requiring RRR to continue to reduce its existing reserves.
The State of California enacted AB 939 legislation in 1989 which required that all
municipalities divert 50% of waste from the landfill by 2010 and 75% by the year 2020.
This sparked the increase in blue cart recycling programs at the municipal and county
RAI
levels throughout the late 1990's and the early 2000's. This legislation also led to
development of additional opportunities for waste diversion, green carts for yard
clippings, and food scraps composting programs to meet the mandatory state diversion
requirements, all without additional state or federal funding to absorb costs for these
new collection programs. In 2012, the State of California enacted AB 341 which
mandates that all multi - family buildings with five or more units must implement a
recycling program for its tenants, and all commercial entities generating four yards of
trash weekly must also implement a recycling program for employees and
clients /customers. The expenditures for outreach, marketing, collections, hauling and
processing of these additional materials through this new mandate are currently being
absorbed through a rate structure approved almost a decade ago.
Operational issues have also had an impact on the cost of RRR programs. On October
31, 2013 Puente Hills Landfill, owned and operated by the Los Angeles County
Sanitation District, maximized its lifetime capacity for waste disposal and officially
closed. This closure has resulted in the City seeking out and disposing of waste at
landfills at a further distance and a higher cost due to market demand for landfill space.
Landfill disposal and waste to energy fees increase annually between 1.2% and 6.4 %,
whereas the revenues received from rate payers for all services increase by CPI /COLA.
The rate adjustments have been as low as 2.0% and as high as 3.7 %, an average of
2.8% over the last seven years.
The existing fees collected by the City pay for more than just refuse collections and
disposal. A variety of programs tailored to increase diversion opportunities for residents
and businesses are funded by fees. The fees pay for collection and processing of
recyclables, food scraps, yard debris and bulky items, as well as equipment,
infrastructure, container replacements, support services, alternative technology studies,
education, marketing, outreach, public litter collection, household hazardous waste
collection, and street sweeping services. Fees also pay for the monthly community
3
events which include paper shredding, compost give away, textile recycling, electronics
recycling, costume swap, and other activities offered to all residents.
The following chart shows that operational expenditures have been exceeding revenues
regularly since FY 2009/10. Operational expenditures for salaries and wages, supplies
and expenses, and Capital Improvement Projects (CIP) are listed as columns with the
revenues graphed to demonstrate the comparison for past and future projections.
Expenditure to Revenue Comparison
30,000,000
25,000,000 —
CIP
20,000,000 —
" Supplies /Expenses
15,000,000 Salaries /Benefits
Revenue
10,000,000 —
5,000,000
FY07 /08 FY08 /09 FY09 /10 FY10 /11 FY11/12 FY12 /13 FY13/14 FY14 /15 FY15/16 FY16/17
City staff has monitored expenditures and implemented cost saving measures in daily
operations for all line items that are not affected by outside increases such as landfill
disposal costs. Table 1 below shows the operational savings in several line items since
2008.
M
Table 1
Five Year Operational Savings
Fiscal Year
Budget
Actual
Savings
Percent =
FY 2008 -09
$ 19,533,791
$ 18,573,876
$ 959,915;
4.9%
FY 2009 -10
$ 19,822,435
$ 19,192,745
$_ 629,690 `
3.2%
FY 2010 -11
$ 19,839,367
$ 18,787,512
$ 1,051,855
5.3%
FY 2011 -12
$ 20,826,803
$ 20,497,057
FY 2016 -17
$ 329,746
1.6%
FY 2012 -13
$ 21,690,342
$ 19,594,491
$ 2,095,851
In spite of these efforts, the cost of Resource Recovery & Recycling operations
continues to exceed the revenue received. There will be a fund deficit by FY2016 -17 if
a structural adjustment to rates is not implemented. Unrestricted cash reserves have
been used to offset the increased costs for services. Table 2 shows the reserve levels
since FY 2009 -10 through to the projected deficit in FY 2016 -17.
Table 2
Changes in the Cash Reserve Fund
The decreases in the reserve fund are the result of several unscheduled events during
past budgeted years and projections for the next three fiscal years. The reserve
decrease in FY 2009 -10 was a result of one time funding needed for the design of the
Resource Recovery Facility. Funds were spent in FY 2011 -12 for the initial start -up of
the bulky item collection crew and the purchase of several additional vehicles to perform
5
CASH RESERVES
Actual
Actual
Actual Actual
Budget
FY 2009 -30
FY 2010 -11
FY 2011.12 FY 2012 -13
FY 2013 -14
FY 2014 -15
FY 2015.16
FY 2016 -17
BEGINNING CASH BALANCE
4,062,138
3,773,868
3,882,791 2,211,677
3,593,135
1,286,161
982,434
566,562
ENDING CASH BALANCE
3773868
3883_791
2212 ,677 3593_135
1281 ,161
98434
565562
275727
Decrease /(Increase) in Cash
Reserve
288,270
(108,923)
1,671,114 (1,381,458)
2,306,974
303,727
415,872
842,289
The decreases in the reserve fund are the result of several unscheduled events during
past budgeted years and projections for the next three fiscal years. The reserve
decrease in FY 2009 -10 was a result of one time funding needed for the design of the
Resource Recovery Facility. Funds were spent in FY 2011 -12 for the initial start -up of
the bulky item collection crew and the purchase of several additional vehicles to perform
5
collection services including the new organics collection program. In FY 2012 -13,
operational procedures were implemented to achieve ongoing staffing and equipment
savings and a one time savings in construction and demolition planning programs.
Beginning in FY 2013 -14, the decrease in the reserve is a projection because the actual
bottom line savings will not be known until the close of the Fiscal Year. All future fiscal
year projections are based upon an estimated CPI of 2.5 %.
Discussion
Zero Waste Strategic Plan
In order to gather input from the public on the proposed Zero Waste Plan staff initiated a
number of efforts to reach out to system users for their input on the Plan. Community
members and stakeholders were provided the opportunity to complete a survey
regarding the City's proposed Zero Waste Strategic Plan. The Zero Waste survey
solicited input on the potential policies, programs, and infrastructure options identified in
the Plan. Separate surveys were provided for single - family residents, multi - family
residents, and businesses, to collect input specific to the interests of these individual
stakeholders. The City initially made the survey available at the annual Santa Monica
Festival, and used interns to canvas the Farmer's Markets. Postcards were placed at
all public counters and coffee shops around the City, and an email blast was sent out to
over 4,000 businesses and residents. The City also reached out to the neighborhood
associations, the Santa Monica Chamber of Commerce and the City's Rent Control
Board to place ads in their newsletters. To obtain as many responses to the Zero Waste
Strategic Plan survey as possible, staff provided incentives for the completion of the
surveys within a specific timeframe. Single family residents received a free container
cleaning service; multi - family residents received kitchen pails. Commercial businesses
could attend one free paper shred event with volume limitations.
The surveys included a series of questions; responders were asked to indicate whether
they Strongly Agreed, Agreed, were Neutral, Disagreed or Strongly Disagreed with each
question or statement. The survey questions and responses to the surveys are
summarized below:
Single- Family Survey
The Single - Family Survey asked for input on 22 ideas for possible policies, programs,
and infrastructure included in the Zero Waste Strategic Plan. A total of 1,034 surveys
were viewed online with 238 surveys completed. Overall, residents strongly support the
City's adoption of Zero Waste, and the policies, programs, and infrastructure options
that will help the City to achieve Zero Waste. Eighteen of the 22 questions received a
response of Strongly Agree or Agree from 75% or more of the responders. One third of
the questions received a response of Strongly Agree or Agree from 90% or more of the
responders. More than eighty percent (80 %) of single family residents who completed
the survey were in favor of food waste recycling, additional public recycling containers
citywide, additional education and outreach for new recycling programs and a two
container collection system.
7
Multi - Family Survey
The Multi - Family Survey asked for input on 15 ideas for possible policies, programs,
and infrastructure included in the Zero Waste Strategic Plan. Although 602 web users
viewed the multi - family survey online, only 113 surveys were completed. Overall,
multi - family residents strongly support the City's adoption of Zero Waste, and the
policies, programs, and infrastructure options that will help the City to achieve Zero
Waste. Twelve of the 15 questions received a response of Strongly Agree or Agree
from 75% or more of the responders. Residents acknowledged that they wanted to
improve current recycling processes and future programs to divert hazardous items
from landfills.
Commercial Survey
The Commercial Survey asked for input on 19 ideas for possible policies, programs,
and infrastructure included in the Zero Waste Strategic Plan. A total of 84 surveys were
completed out of 525 online views and 700 personal visits to businesses by summer
interns. Overall, the responders indicated strong support for the City's adoption of Zero
Waste, and the policies, programs, and infrastructure options that will help the City to
achieve Zero Waste. Twelve of the 19 questions received a response of Strongly Agree
or Agree from 75% or more of the responders. One fourth of the questions received a
response of Strongly Agree or Agree from 90% or more of the responders.
Responders to the survey supported additional recycling programs for their businesses
and incentives for employees to reduce waste and reuse materials. Many were also in
favor of manufacturer take -back programs.
The results of the surveys and comments received from the public at these numerous
venues were very positive and supportive of the City's proposed Zero Waste goals. As
a result, these comments were included into the Zero Waste Strategic Plan for final
adoption. The survey questions and results were added to the Zero Waste Strategic
Plan as Appendix l and are attached.
R
Rate Study
In May 2011, staff issued a RFP for a consultant to assist with the development of the
Zero Waste Strategic Plan. On November 22 2011 Council approved HDR
Engineering and HF &H Consultants to assist with the Plan. HF &H Consultants
conducted the financial analysis on the Plan and the anticipated impact on rates for the
proposed programs listed in the Zero Waste Plan. As a result of the analysis on the
proposed programs and rates, HF &H was retained by the City in March 2013 to perform
a more in depth rate study including an evaluation of the current rate structure.
The rate study evaluated projected revenues, expenditures and the fund balance for a
five year period, assuming continuation of the existing services and the existing rate
structure. The rate study included an analysis of the alignment of current rate revenue
with the cost of service for single family, multi - family and commercial customers; these
are referenced in the report as service sectors. The objectives of the solid waste rate
study are to:
• Evaluate the adequacy of existing rates to reasonably fund current services and
maintain target reserves
• Compare existing rate revenues by service sector (residential, multi - family and
commercial) to the cost of service.
Operational costs for waste collection services are increasing annually. Unrestricted
cash fund reserves are being used to continue to perform on -going services. The
reserve fund is established as just that, reserve. The reserve fund should be used on a
limited basis as a result of loss due to a catastrophic event or unscheduled events
including unanticipated increases in landfill disposal fees, organics waste processing
fees, or a substantial decrease in revenue. The rate study determined that a 5%
reserve of the total revenue generated for the enterprise fund is sufficient. Additional
waste management services to enhance diversion programs would not be implemented
if rates are increased by only the CPI /COLA. Without an additional rate increase, the
10
reserve fund will be expended by FY 2016 -17 and the General Fund will become the
lending agency to fund the ongoing waste management.
Based on the data that RRR staff provided, the consultant developed scenarios based
on rate adjustment recommendations for a three year period beginning July 1, 2014:
Table 3 illustrates the current rate structure and calculates the unrestricted cash
balance by adjusting customer rates by 2.5% annually starting in FY 2014 -15 as the
assumed CPI /COLA adjustment percentage. As shown in the table, if customer rates for
all sectors are only adjusted by the City's projections for CPI /COLA for the five year
period, the City will have an unrestricted cash balance of $ (247,250) for FY 2016 -17.
Table3
Current Rates with CPI /COLA Adiustment
Scenario 1: Sector Service Rates and a 5% Unrestricted Cash Balance
The goal of Scenario 1 is to maintain an unrestricted cash balance of 5% of total
expenditures in FY 2016 -17 and to align rate revenues with the cost of service among
customer sectors (residential, multi - family and commercial). Each sector was analyzed
to determine actual operating expenditures for services performed, rates required to
11
Actual
2012 -13
; Projected
2013 -14
Projected
3014-15
Projected
2015-16
Projected
`2016.17
CUSTOMER RATE ADJUSTMENT ASSUMPTIONS
Single Family
3.00
2.40°
2.50
2.50°
2.50
Multi-Family
3.00°
2.40°
2.50
2.50
2.50
Commercial
3.00°
2.40°
2.50
2.50
2.50
NETREVENUE /(EXPENSE) ASA% OF SECTOR REVENUE
Single Family
-3Y
-10%
-5%
-5%
-7%
Multi-Family
19%
13°
17%
17%
16%
Commercial
-28%
-34°
-30%
-31%
-33%
ASH BALANCE
ear -End Unrestricted Cash
5 3,108,800
5 1,680,286
1,220,116
$ 684,184
(247,250)
Ending Unrestricted Cash Balance As A %of Total Expenditures
1391
7%
5%
3%
Scenario 1: Sector Service Rates and a 5% Unrestricted Cash Balance
The goal of Scenario 1 is to maintain an unrestricted cash balance of 5% of total
expenditures in FY 2016 -17 and to align rate revenues with the cost of service among
customer sectors (residential, multi - family and commercial). Each sector was analyzed
to determine actual operating expenditures for services performed, rates required to
11
perform these services, and rates required to increase the reserve fund. This scenario
provides for a 5% unrestricted cash balance by FY 2016 -17, and aligns rate revenues
with the cost of service in each sector by the end of FY 2016 — 17.
Table 4
Sector Service Rates Maintaining 5% Reserve
Tables 5 through 7 illustrate the customer rate impacts of each scenario over the
projection period. Rates used in the projections are the most commonly used service
level rates based on the data provided for FY 2011 -12. In addition to the CPI /COLA,
single family proposed rates increase slightly, multi - family proposed rates decrease and
commercial proposed rates increase as well. All of these sector rates include waste,
recycling and food waste collection services, bulky item and household hazardous
waste collection programs, street sweeping services, public litter /recycling collection
services, education and outreach materials and monthly reuse and recycling events.
12
Actual
2012-13
Projected..
2013- 14..`.
Projected
2014 -15
Projected
2015.16
Projected
2016.17
CUSTOMER RATE ADJUSTMENT ASSUMPTIONS
Single Family
3.00°
2.40°
3.855
3.85°
185
Multi- Family
3.00°
2.40°
1.009
1.00
1.00°
Commercial
3.00°
2AW
7.25
7.25
7.25°
NETREVENUE((EXPENSE) ASA% OF SECTOR REVENUE
Single Family
-3
-10%
4 %
-3%
-2.9%
Multi -Famil
19%
13%
15%
15%
12%
Commercial
-M
-34%
-25%
-20%
-17%
ASH BALANCE
Year-End Unrestricted Cash
3,108,800
1,680,286
5 1,450,573
1,409,334
1,281,491
Ending Unrestricted Cash Balance AsA %of Total Expenditures
13%
7%
6%
5%
5%
Tables 5 through 7 illustrate the customer rate impacts of each scenario over the
projection period. Rates used in the projections are the most commonly used service
level rates based on the data provided for FY 2011 -12. In addition to the CPI /COLA,
single family proposed rates increase slightly, multi - family proposed rates decrease and
commercial proposed rates increase as well. All of these sector rates include waste,
recycling and food waste collection services, bulky item and household hazardous
waste collection programs, street sweeping services, public litter /recycling collection
services, education and outreach materials and monthly reuse and recycling events.
12
Table 5
Single Family Rate Impact (One 95- gallon refuse cart)
Table 6
Multi - Family Rate Impact (2 cubic yard bin collected twice per week)
Percentage
Current 201314 Rates
- -
Adjusted Monthly Rate
Projected 2014-15
Projected 2015 -16 '
Projected 2016 -17 -
BI- Monthly
Rate
Monthly
Rate
Monthly
Rate
Increase
Monthly
Rate
Increase
Monthly
Rate
Increase
Single Family
Increase
(luly1,2014)
CPI /COLA
2.50°
$ 88.34
$ 44.17
$ 45.27
$ 1.10
$ 46.41
$ 1.14
$ 47.57
$ 1.16
Scenario 1: includes
3.85°
$ 88.34
$ 44.17
$ 45.87
$ 1.70
$ 47.64
$ 1.77
$ 49.47
$ 1.83
(2.5 %CPI /COLA, plus
1.35 %)
Table 6
Multi - Family Rate Impact (2 cubic yard bin collected twice per week)
Table 7
Commercial Rate Impact (2 cubic yard bin collected twice per week)
Percentage
Current 201314 Rates
Adjusted Monthly Rate
Projected 2014 -15
Projected 203516 `
Projected 201617
BI- Monthly
Rate
Monthly
Rate
Monthly
Rate
Increase
Monthly
Rate
Increase
Monthly
Rate
Increase
Multi - Family
Increase
(July 1, 2014)
CPI /COLA
2.50°
$ 324.93
$ 162.47
$ 119.78
$ 2.92
$ 122.78
$ 3.00
$ 125.85
$ 3.07
Scenario 1
1.
$ 324.93
$ 162.47
$ 125.33
$ 8.47
$ 134.42
$ 9.09
$ 144.16
$ 9.74
Table 7
Commercial Rate Impact (2 cubic yard bin collected twice per week)
Solid Waste Rate Comparison with Neighboring Communities
Tables 8 - 9 summarize monthly solid waste rates under the City of Santa Monica's
proposed solid waste rates for all scenarios and the current solid waste rates of several
neighboring communities. The proposed monthly rate compares favorably with the
other communities surveyed.
13
Percentage
'Current 201314 Rates
Adjusted Monthly Rate
Projected 201415
Projected 201516 "
Projected 201617 `
Bi- Monthly
Rate
Monthly
Rate
Monthly
Rate
Increase
Monthly
Rate
Increase
Monthly
Rate
Increase
Commercial
Increase
'.
(July 1, 2014)
CPI /COLA
2.50
$ 233.72
$ 116.86
$ 119.78
$ 2.92
$ 122.78
$ 3.00
$ 125.85
$ 3.07
Scenario 1: includes
7.25
$ 233.72
$ 116.86
$ 125.33
$ 8.47
$ 134.42
$ 9.09
$ 144.16
$ 9.74
(2.5% CPI /COLA, plus
4.75 %)
Solid Waste Rate Comparison with Neighboring Communities
Tables 8 - 9 summarize monthly solid waste rates under the City of Santa Monica's
proposed solid waste rates for all scenarios and the current solid waste rates of several
neighboring communities. The proposed monthly rate compares favorably with the
other communities surveyed.
13
Table 8
FY 2013 -14 - Current Rates
City i
Sin' le Family 95)
Multi- Family
Commercial (2yd)
Beverly Hills
.0104 per square
foot lot size
$ 18.31 per unit
$ 105.40
Burbank
$ 49.13
$ 138.09
$247.91
Culver City
$ 41.86
(64 gallon container)
< 4 units use single
family rate; >4 units
use commercial rate
$ 186.13
Los Angeles
$ 36.32
$ 24.33 per unit
NA
Pasadena
$ 40.99
$ 50.44 196gallon
$ 157.34
Santa Monica
$ 44.17
$ 162.47
$116.86
Table 9
Sector Service Rate with a 5% Unrestricted Cash Balance
As stated earlier, the Zero Waste Strategic plan identifies new policies, programs and
infrastructure that will enable the City to reach its Zero Waste goal of 95% diversion by
2030, or a per capita disposal rate of 1.1 pounds per person per day. These programs
will also affect existing rates from FY 2014 -15 through FY 2029 -2030.
For each selected program, the incremental change in the annual cost for the program
and the cost per ton diverted was estimated. The cost estimates provide a reasonable
basis for understanding the potential cost impacts and how costs between programs
compare to one another. The estimates presented are not intended to calculate the
W,
Sin Ie Faroii 95 i
Multi- Family
'Commercial 4jd=
Beverly Hills
.0104 per square foot
lot size
$ 18.31 per unit
$ 105.40
Burbank
$ 49.13
$ 138.09
$247.91
Culver City
$ 41.86
(64 gallon container)
< 4 units use single
family rate; >4 units
use commercial rate
$ 186.13
Los Angeles
$ 36.32
$ 24.33 per unit
NA
Pasadena
$ 40.99
$ 50.44/96 gallon
$ 157.34
Santa Monica
$ 45.87
$ 164.09
$ 125.33
As stated earlier, the Zero Waste Strategic plan identifies new policies, programs and
infrastructure that will enable the City to reach its Zero Waste goal of 95% diversion by
2030, or a per capita disposal rate of 1.1 pounds per person per day. These programs
will also affect existing rates from FY 2014 -15 through FY 2029 -2030.
For each selected program, the incremental change in the annual cost for the program
and the cost per ton diverted was estimated. The cost estimates provide a reasonable
basis for understanding the potential cost impacts and how costs between programs
compare to one another. The estimates presented are not intended to calculate the
W,
precise results of each program. The tables present a "low" and "high" estimate of the
incremental change in the Division's cost associated with the implementation of these
programs. The range of costs is reflective of the range experienced in other
communities that have implemented these or similar programs. Table 10 presents the
incremental annual change in program costs, the estimated tons diverted by program,
and the cost/(savings) per diverted ton for each of the selected programs.
Table 10
Using the cost analysis data, the percentage impact on existing customer rates for each
of the selected program options was calculated. The rate impacts for each selected
program are cumulative. The rate impacts are based on fiscal year 2013 budget data
15
No
tow
High
' Low
Midpoint
iHigh
Residential'
Food Scraps Collection
Short
$
90,346
$
132,755
1,124
$ 80
$
99
$
118
Behavior Change Marketing
Short
$
28,582
$
60,418
410
$ 70
$
109
$
147
Weekly Organics and Recyclables COI lection;
Bi- Weekly Refuse Collection
Short-Med
$
(157,402)
$
(137,671)
504
$ (312)
$
(292)
$
(273)
Wet /Dry Collection
Med -Long
$
(295,135)
$
(252,622)
562
$ (525)
$
(487)
$
(449)
Residuals Processing
Long
$
10,716
$
13,211
1,248
$ 9
$
30
$
11
Multi- Family
Low
High
' Low
Midpoint
High
Behavior Change Marketing
Short
$
211,746
$
375,609
1,549
$ 137
$
190
$
242
Bulky Item Collection; Move-In/Move-Out
Program
Short-Med
$
160,896
$
230,483
176
$ 916
$
1,114
$
1,312
Weekly Organics and Recyclables Collection;
BI-Weekly Refuse Collection
Short-Med
$
(229,434)
$
(201,057)
2,694
$ (85)
$
(80)
$
(75)
Food Scraps Collection - Cart Customers
Medium
$
39,381
$
58,132
476
$ 83
$
102
$
122
Food Scraps Collection - Bin Customers
Medium
$
130,258
$
300,681
463
$ 281
$
465
$
649
Wet /Dry Collection
Med -Long
$
(94,878)
$
(81,319)
1,615
$ (59)
$
(55)
$
(50)
Residuals Processing
Long
$
29,006
$
35,760
3,377
$ 9
$
10
$
11
Commercial
LOW
High
Low
Midpoint
High
Behavior Change Marketing
Short
$
(101,132)
$
(44,065)
2,831
$ (36)
$
(26)
$
(16)
Food Scraps Collection
Medium
$
456,964
$
615,261
3,975
$ 115
$
135
$
155
Wet /Dry Collection
Med -Lang
$
(210,325)
$
(185,492)
$
(76)
(71)
Expansion of Mandatory Commercial Recycling
Long
$
214,645
$
355,382
906
$ 237
$
315
f$39 2
Residuals Processing
Long
$
41,976
$
51,750
4,887
$ 9
$
10
11
Using the cost analysis data, the percentage impact on existing customer rates for each
of the selected program options was calculated. The rate impacts for each selected
program are cumulative. The rate impacts are based on fiscal year 2013 budget data
15
and cumulative future tonnage diversion assumptions. An average change of the "Low"
and "High" rate impacts are illustrated in Table 11.
Table 11
Weekly Organics and Recyclables Collection; Bi -I $ (157,402)I $ (137,671)I 5041
Weekly Refuse Collection
Wet /Dry Collection $ (295,135) $ (252,622) 562
Weekly Organics and Recyclables Collection; Bi -I $ (229,434) $ (201,057)) 2,694
Weekly Refuse Collection
Wet /Dry Collection I $ (94,878) $ (81,319) 1,615
Behavior Change Marketing 1 $ (101,132) $ (44,065) 2,831
Wet /Dry Collection $ (210,375) $ (185,492) 2,620
The most cost effective programs are those that result in net cost savings. These
programs are illustrated in Table 12.
Table 12
T
Rate Adjustment Alternatives
As stated previously, there will be a fund deficit by FY2016 -17 if existing rates remain
with only an annual CPI /COLA increase. If a rate adjustment is not implemented, staff
would continue to analyze existing operations to streamline programs to seek additional
savings. Streamlining existing services may include a reduction in the daily bulky item
(illegal dumping) collection program, elimination of the commercial food waste collection
program, and implementing monthly, rather than weekly residential street sweeping
services. Council may also determine that the proposed five percent cash reserve be
decreased which would lessen the proposed rate adjustment. Lowering the proposed
five percent cash reserve would not ensure available funds for extraordinary events
such as unanticipated landfill disposal fees, additional state and federal recycling
mandates, or increased organics processing fees.
An Integrated Waste Management System is essential to the infrastructure of trash
collections as we know it today. Landfills are closing; programs, policies and alternative
technologies need to be further developed in order to sustain waste generation and
waste processing operations. The City will continue to evaluate the efficacy of each
strategy, and modify the Plan as necessary to meet the zero waste goals and
objectives, and to adjust to the changing social, environmental, and economic
conditions within the City.
Next Steps
If directed by Council to proceed with the rate adjustment and the establishment of a 5%
operating reserve, staff will initiate the Proposition 218 requirements for public noticing
of the proposed changes to affected property owners. Proposition 218 created a
category of fees known as "property- related fees." Such fees may not be imposed or
increased unless a local government conducts a majority - protest proceeding. A 45 day
notice /response period will be in effect from the date notices are distributed. At the end
of the protest period the final tally of voters will be presented to Council at a public
17
hearing. If no majority protest is received, Council would then be able to adopt the rates
for implementation on July 1, 2014.
Financial Impacts & Budget Actions
There is no immediate financial impact or budget action necessary as a result of
adopting the Zero Waste Strategic Plan. Staff will return to Council if specific budget
actions are required in the future for implantation of program initiatives.
There is no budget impact from authorizing staff to proceed with Proposition 218
noticing. If Council decides to approve the proposed sector service rates after the
protest period, there will be an increase to the FY2014/15 Garbage /Refuse Collection
revenue. The amount of the rate impact will be presented to Council with the rate
adoption staff report. Future year increases will be reflected in the proposed budgets.
Prepared by: Kim Braun, Resource Recovery and Recycling Manager
Approved:
Forwarded to Council:
Martin Pas ucha Rod Gould
Director of Public Works City Manager
Attachments:
Attachment: Zero Waste Strategic Operations Plan Appendix I — Zero Waste Survey
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Zero Waste Surveys
In order to gather input from the public, interested community members and stakeholders were given
the opportunity to complete a survey regarding the City's proposed Zero Waste Strategic Plan. The Zero
Waste survey solicited input on the potential policies, programs, and infrastructure options
identified in the Plan. Separate surveys were provided for single - family residents, multi - family
residents, and businesses, to enable input specific to the interests of these individual
stakeholders. To get the word out, the City initially made the survey available at the annual
Santa Monica Clover Park Festival, and used interns to canvas the Farmer's Markets. The City
created postcards that were placed at all the public counters and coffee shops around the City,
and an email blast was sent out to over 4,000 businesses and residents. The City also reached
out to the neighborhood associations and to the Santa Monica Chamber of Commerce to place
ads in their newsletters.
The surveys included a series of questions, and responders were asked to indicate whether they
Strongly Agreed, Agreed, were Neutral, Disagreed or Strongly Disagreed with each question or
statement. The survey questions and responses to the surveys are summarized below, and copies of
the surveys are included at the end of this Appendix.
Single-Family Survey
The Single - Family Survey asked for input on 22 ideas for possible policies, programs, and infrastructure
included in the Zero Waste Strategic Plan. A total of 238 surveys were completed. Overall, residents
strongly support the City's adoption of Zero Waste, and the policies, programs, and infrastructure
options that will help the City to achieve Zero Waste. Seventeen of the 22 questions received a
response of Strongly Agree or Agree from 75% or more of the responders. One third of the questions
received a response of Strongly Agree or Agree from 90% or more of the responders. programs that
received lower support included enforcing anti - scavenging, curbside textile recycling, and document
shredding. The results are tabulated below.
Policy Options
Single - family residents were asked whether they support the following policy options:
1. Formal commitment to achieving Zero Waste by 2030.
Strongly Agree or Agree: 88%
Neutral: 8%
Disagree or Strongly Disagree: 4%
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2. Expansion of recycling efforts at City facilities.
Strongly Agree or Agree: 95%
Neutral: 4%
Disagree or Strongly Disagree: 1%
3. Evaluate and identify improvements to residential curbside recycling program and incorporate
rate structure incentives.
Strongly Agree or Agree:
94%
Neutral:
4%
Disagree or Strongly Disagree:
2%
4. Require manufacturers to take back their products.
Strongly Agree or Agree: 74%
Neutral: 17%
Disagree or Strongly Disagree: 9%
5. City educating residents about sustainable purchasing practices.
Strongly Agree or Agree: 87%
Neutral: 11%
Disagree or Strongly Disagree: 2%
6. Increasing enforcement of anti - scavenging ordinance for curbside recycling containers.
Strongly Agree or Agree: 39%
Neutral: 24%
Disagree or Strongly Disagree: 37%
7. Bans on hard to recycle materials, such as plastic bags and Styrofoam food packaging.
Strongly Agree or Agree: 74%
Neutral: 16%
Disagree or Strongly Disagree: 10%
Program Options
Single- family residents were asked whether they support the following program options:
8. Residential food waste recycling
Strongly Agree or Agree: 82%
Neutral: 12%
Disagree or Strongly Disagree: 6%
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9. Business food waste recycling program
Strongly Agree or Agree: 94%
Neutral: 4%
Disagree or Strongly Disagree: 2%
10. Two container weekly collection program (organics and recycling)
Strongly Agree or Agree: 73%
Neutral: 16%
Disagree or Strongly Disagree: 11%
appendix I
11. Increased educational outreach, with regular updates, circulation, and announcements.
Strongly Agree or Agree: 86%
Neutral: 10%
Disagree or Strongly Disagree: 4%
12. Free technical assistance to businesses
Strongly Agree or Agree:
88%
Neutral:
9%
Disagree or Strongly Disagree:
3%
13. Online service to reduce /stop junk mail
Strongly Agree or Agree: 90%
Neutral: 7%
Disagree or Strongly Disagree: 3%
14. School recycling programs
Strongly Agree or Agree:
96%
Neutral:
3%
Disagree or Strongly Disagree:
1%
15. Curbside textile recycling program
Strongly Agree or Agree:
65%
Neutral:
29%
Disagree or Strongly Disagree:
6%
16. Re -Use programs, such as Citywide Yard Sale
Strongly Agree or Agree: 79%
Neutral: 19%
Disagree or Strongly Disagree: 2%
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17. Recycling collection containers in public places
Strongly Agree or Agree: 96%
Neutral: 4%
Disagree or Strongly Disagree: 0%
Infrastructure Optioaes
Single- family residents were asked whether they support the following infrastructure options:
appendix I
18. Development of regional organics composting facilities in partnership with neighboring cities.
Strongly Agree or Agree: 82%
Neutral: 14%
Disagree or Strongly Disagree: 4%
19. Development of residual waste recycling facilities in partnership with neighboring cities
Strongly Agree or Agree: 85%
Neutral: 10%
Disagree or Strongly Disagree: 5%
20. Development of self -haul facility to recycle furniture, mattresses and white goods.
Strongly Agree or Agree: 77%
Neutral: 17%
Disagree or Strongly Disagree: 6%
21. Establishment of a permanent household hazardous waste collection program within City limits.
Strongly Agree or Agree: 92%
Neutral: 7%
Disagree or Strongly Disagree: 1%
22. Regular document shredding services.
Strongly Agree or Agree: 53%
Neutral: 36%
Disagree or Strongly Disagree: 11%
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it ulti -F raffly Siuvtev
The Multi - Family Survey asked for input on 15 ideas for possible policies, programs, and infrastructure
included in the Zero Waste Strategic Plan. A total of 113 surveys were completed. Overall, multi - family
residents strongly support the City's adoption of Zero Waste, and the policies, programs, and
infrastructure options that will help the City to achieve Zero Waste. Twelve of the 15 questions received
a response of Strongly Agree or Agree from 75% or more of the responders. Questions that received
lower support included satisfaction with their current recycling processes and satisfaction with current
work to divert hazardous items from landfills. The results are tabulated for each question below.
Policy Options
Multi - family residents were asked whether they support the following policy options:
1. Formal commitment to achieving Zero Waste by 2030.
Strongly Agree or Agree: 93%
Neutral: 6%
Disagree or Strongly Disagree: 1%
2. Evaluate and identify improvements to recycling program and incorporate rate structure
incentives.
Strongly Agree or Agree: 94%
Neutral: 3%
Disagree or Strongly Disagree: 3%
3. Satisfaction with your building's current recycling processes
Strongly Agree or Agree: 340/a
Neutral: 23%
Disagree or Strongly Disagree: 43%
4. City educating residents about sustainable purchasing practices
Strongly Agree or Agree: 89%
Neutral: 8%
Disagree or Strongly Disagree: 3%
5. Require manufacturers to take back their products.
Strongly Agree or Agree: 71%
Neutral: 20%
Disagree or Strongly Disagree: 8%
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6. Bans on hard to recycle materials, such as plastic bags and Styrofoam food packaging.
Strongly Agree or Agree: 77%
Neutral: 15%
Disagree or Strongly Disagree: 8%
Program Options
Multi- family residents were asked whether they support the following program options:
7. Residential food waste recycling.
Strongly Agree or Agree: 85%
Neutral: 9%
Disagree or Strongly Disagree: 6%
appendix I
8. Increased educational outreach with regular updates, circulation, and announcements.
Strongly Agree or Agree: 89%
Neutral: 9%
Disagree or Strongly Disagree: 2%
9. Curbside textile recycling collection.
Strongly Agree or Agree: 75%
Neutral: 20%
Disagree or Strongly Disagree: 5%
10. Reuse program, such as Citywide Yard Sale.
Strongly Agree or Agree: 86%
Neutral: 13%
Disagree or Strongly Disagree: 1%
11. Recycling collection containers in public places.
Strongly Agree or Agree: 95%
Neutral: 5%
Disagree or Strongly Disagree: 0%
Infrastructure Options
Multi - family residents were asked whether they support the following infrastructure options:
12. Development of regional organics composting facilities in partnership with neighboring cities.
Strongly Agree or Agree: 91%
Neutral: 6%
Disagree or Strongly Disagree: 3%
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13. Does your building currently work to divert hazardous items from landfills, such as batteries, ink,
paint, and other E- Waste?
Strongly Agree or Agree: 25%
Neutral: 14%
Disagree or Strongly Disagree: 61%
14. Use of posters, signs, decals or promotional materials to help neighbors recycle.
Strongly Agree or Agree: 79%
Neutral: 16%
Disagree or Strongly Disagree: 5%
15. Development of self -haul facility to recycle furniture, mattresses and white goods.
Strongly Agree or Agree: 79%
Neutral: 17%
Disagree or Strongly Disagree: 4%
Commercial Survey
The Commercial Survey asked for input on 19 ideas for possible policies, programs, and infrastructure
included in the Zero Waste Strategic Plan. A total of 84 surveys were completed, overall, the
responders indicated strong support for the City's adoption of Zero Waste, and the policies, programs,
and infrastructure options that will help the City to achieve Zero Waste, Thirteen of the 19 questions
received a response of Strongly Agree or Agree from 75% or more of the responders. One fourth of the
questions received a response of Strongly Agree or Agree from 90% or more of the responders. The
results are tabulated for each question below.
Policy Options
Commercial businesses were asked whether they support the following policy options:
1. Business policies for waste reduction.
Strongly Agree or Agree: 96%
Neutral: 1%
Disagree or Strongly Disagree: 3%
2. Business recycling
Strongly Agree or Agree; 98%
Neutral: 1%
Disagree or Strongly Disagree: 1%
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3. Satisfaction with current recycling program.
Strongly Agree or Agree: 68%
Neutral: 14%
Disagree or Strongly Disagree: 18%
4. Staff responsible to ensure recycling.
Strongly Agree or Agree: 76%
Neutral: 13%
Disagree or Strongly Disagree: 11%
5. Employee incentives to reduce, reuse, and recycle.
Strongly Agree or Agree: 72%
Neutral: 21%
Disagree or Strongly Disagree: 7%
6. Require manufacturers to take back their products.
Strongly Agree or Agree: 61%
Neutral: 28%
Disagree or Strongly Disagree: 11%
Progs•ain OPtRotts
Commercial businesses were asked whether they support the following program options:
appendix I
7. Weekly collection program that separates wet waste (organics) from dry waste (recycling).
Strongly Agree or Agree: 81%
Neutral: 13%
Disagree or Strongly Disagree: 6%
8. Increased education outreach, with regular updates, circulation, and announcements.
Strongly Agree or Agree: 88%
Neutral: 7%
Disagree or Strongly Disagree: 5%
9. Facilities for compostabie materials.
Strongly Agree or Agree: 90%
Neutral: 6%
Disagree or Strongly Disagree: 4%
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10. Native or low water, low maintenance plans to reduce trimmings and water use.
Strongly Agree or Agree: 60%
Neutral: 33%
Disagree or Strongly Disagree: 7%
11. Recycling of hazardous items, such as batteries, ink, paint, and other E- waste.
Strongly Agree or Agree: 84%
Neutral: 8%
Disagree or Strongly Disagree: 8%
12. Use of recyclable or compostable packaging material.
Strongly Agree or Agree: 95%
Neutral: 4%
Disagree or Strongly Disagree: 1%
13. Use of reusable shipping containers.
Strongly Agree or Agree: 93%
Neutral: 6%
Disagree or Strongly Disagree: 1%
14. Use of returnable pallets.
Strongly Agree or Agree: 83%
Neutral: 17%
Disagree or Strongly Disagree: 0%
15. Use of posters, signs, decals, or promotional materials to help employees recycle.
Strongly Agree or Agree: 70%
Neutral: 22%
Disagree or Strongly Disagree: 8%
16. Support Santa Monica's Green Business Certification Program.
Strongly Agree or Agree: 79%
Neutral: 17%
Disagree or Strongly Disagree: 4%
17. Procurement of recyclable products for your business operations.
Strongly Agree or Agree: 93%
Neutral: 5%
Disagree or Strongly Disagree: 2%
appendix I
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18. Desire to receive more information on Green Business Certification Program.
Strongly Agree or Agree: 59%
Neutral: 32%
Disagree or Strongly Disagree: 9%
19. Interest in learning more about Zero Waste,
Strongly Agree or Agree: 75%
Neutral: 19%
Disagree or Strongly Disagree: 6%
appendix I
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