PRESS RELEASE - Public Works Director Recommends Raising Residential Refuse Rates - 5/18/2017

For immediate release: May 18, 2017

Contact: Rachel Gordon, 415-554-6045

PUBLIC WORKS DIRECTOR RECOMMENDS RAISING RESIDENTIAL REFUSE RATES

Change Would Expand San Francisco’s Capacity to Process More Recyclables

San Francisco, CA – After carefully considering an application by Recology to raise the rates for residential refuse collection and disposal in the City, Public Works Director Mohammed Nuru has recommended an average increase of 14.42 percent.

The increase would equate to $4.85, bringing the monthly cost to $40.04 for a typical single-family home with three 32-gallon bins for trash, composting and recycling.  The costs for residential properties would vary, based on their selected service, such as bin size, number of bins and the number of residential units per property.

Discounts would be expanded to a larger pool of low-income households.

The higher charges would take effect July 1, 2017.

Under City law, any rate increase for residential refuse pickup must be “just and reasonable.”

Recology, the residential refuse company in San Francisco, had requested an average rate increase of 16.4 percent for residential customers in the first year, 4.98 percent in the second year, no increase in the third year and 0.62 percent in the fourth year.

Nuru recommended an average increase of 14.42 percent in the first year, 5.46 percent increase in the second year, a 0.55 percent decrease in the third year and 0.79 percent increase in the fourth year.  Both Recology’s proposal and the director’s recommendation would allow additional cost-of-living adjustments.

Nuru made his recommendation after holding a series of meetings, including two technical workshops and eight public hearings on the proposal, which began in October 2016 and concluded this month. In addition, the director considered the public comments made by mail, e-mail and phone calls, as well as those logged at community meetings.

Staff from Public Works and the Department of Environment who have expertise in rate-setting, financial analysis and municipal solid waste management and forecasting worked with the City Attorney’s Office and outside consultants to evaluate Recology’s proposal to make sure it meets the “just and reasonable” threshold.

“I believe that the costs submitted by Recology and adjusted by the City accurately reflect the cost of providing refuse collection and disposal services to San Francisco ratepayers,” Nuru said. “The costs are driven by changes that can be evaluated and measured.”

The driving contributors to the recommended rate increase are Recology’s rising labor costs – considered the cost of doing business – and the implementation of new programs to help San Francisco reach its goal of zero waste. Other factors include a costlier landfill agreement, higher composting costs due to regulatory changes and the public’s increasing use of existing programs, such as the household hazardous waste program and the bulky item recycling program. 

In addition, a portion of the new revenue would be used to make San Francisco cleaner. For example, curbside garbage cans would be routinely steam cleaned and Recology would make it more convenient for people to get rid of unwanted bulky items, such as ratty furniture, old mattresses and broken appliances, so they don’t dump them illegally outside.

Recology also would need to reconfigure its truck fleet and expand its routes to handle the increase in recyclable and compostable materials.

“As we get closer to zero, it’s harder to reach that goal, and we need to create more opportunities to recycle and compost,” Nuru said. “The recommended residential rate increase will help pay for the programs and technologies to help us keep more of the materials out of the landfill.”

The last residential refuse rate increase was approved in 2013. The director’s recommendation does not apply to commercial rates, which are not regulated by the City.

The director’s recommended orders can be appealed to the Refuse Rate Board, a three-person panel made up of the City Administrator, the San Francisco Public Utilities Commission General Manager and the City Controller, or their designees. An appeal would trigger the issuance of a new notice of a proposed rate increase and public hearings. The Rate Board can be reached c/o City Administrator, Room 362, City Hall, 1 Dr. Carlton B. Goodlett Place, San Francisco, CA 94102. The deadline to appeal is May 30, 2017 at 5 p.m.

Details of the Director’s Report and Recommended Orders and other documents pertaining to Recology’s rate application can be found at http://www.sfpublicworks.org/refuserates.

###