CR 94-59 Prelim Approval Volume Based Refuse Rates
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. March 10 I 1994 .z Council Report: 94-59
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REQUEST FOR PRELIMINARY APPROVAL OF
VOLUME BASED REFUSE RATES
Proposed Action.
Staff recommends adoption of the following motion: IlApprove new
volume based refuse rates as follows: $13.25 for each 30 qallon
container. $15.50 for each 60 qallon container and $17.75 for each 90
gallon container and authorize staff to do a mailing publicizing this
information."
Approval of this motion will set volume based refuse rates to be used
in a postcard mailing to determine what size containers residents
desire. Final approval of the volume based refuse rates will occur at
a later date after residents have returned the postcard with their
choice of container size and staff has determined when the effective
date of the rates should be.
Overview.
. In 1993 the Waste Management Act required that municipal refuse
collectors must charge by weight or volume of material collected and
that the cost for waste disposed of must increase as the weight or
volume increases. The Waste Management Act also required cities to
determine what the base small quantity generator in their community
was. Hopkins recently accomplished this by conducting a survey of our
refuse customers. The proposed container sizes and corresponding
costs are based on information taken from that survey and a survey of
other private haulers.
Primary Issues to Consider
0 What is the purpose of requesting Preliminary Approval?
0 How were the sizes selected?
0 How were the prices determined?
0 When will the rates be permanently set?
Supporting Information
0 Detailed Background
0 Analysis of Issues
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council Report: 94-59
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Detailed Backqround
Effective 1/1/94 Section 115A.9301 Subdivision 2 of the Waste
Management Act requires that if a local government unit collects solid
waste and implements a pricing system based on volume instead of
weight, it shall determine a base unit size for an average small
quantity household generator. The governmental unit must also
establish a multiple unit pricing system to ensure amounts of waste
generated in excess of the base unit amount are priced higher than the
base unit price. During 1993 the Waste Management Act was revised and
allowed for a postponement of the effective date. The city applied
for this postponement and was allowed to wait until 1/1/95 to
implement our volume based pricing system.
In order to comply with the portion of the mandate requiring us to
"determine a base unit size for an average small quantity household
generator" the city of Hopkins hired Decision Resources to conduct a
survey in August of 1993. From this survey it was determined that
unless there was a $4.00 difference between sizes most residents would
not change to a smaller container.
Analvsis of Issues
. 0 What is the purpose of requesting Preliminary Approval?
Staff is requesting preliminary approval on rates because we need
to set the rates in order to let residents know how much they
will save by changing to a smaller container. We need time
before the actual effective date of the rates to have residents
return postcards, determine how many containers to purchase, and
bid out the containers. After that is completed staff will
request formal adoption of the rates that includes an
implementation date.
o How were the sizes selected?
The sizes were determined after reviewing the results of the
refuse survey that indicated to us very few residents would
generate less than 30 gallons of refuse each week. We were also
somewhat influenced by our fully automated refuse system. The
smallest container that this system can easily pick up is a 30
gallon size container. After determining that 30 gallons would
put us in compliance with the Waste Management Act requirement we
moved to the next stage of setting rates for each size.
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Council Report: 94-59
Page 3
. 0 How were the prices determined?
The prices were set by estimating how many smaller containers
would be requested and setting a price that would continue to
generate about the same amount of revenue that we currently need
to pay for our disposal cost. It was assumed that our disposal
cost would remain the same since most people will generate the
same amount of refuse, only put it in a smaller container. staff
computed the new rates based on the amount of refuse that would
be in the different sized containers and the results of those
computations indicated that the 90 gallon container price should
have an increase of $1.05 over our current price of $16.70. The
costs for the 30 and 60 gallon containers were computed to be
lower from the 90 gallon container in increments of $2.25. Staff
felt that the slight increase of the 90 gallon container was not
out of line since it was small, and that our refuse prices have
not increased for quite some time.
o When will the rates be permanently set?
Staff does not have an exact date as to when it will request that
rates be permanently set. We need to wait to receive the new
truck f mail postcards f order and deliver containers and change
the billing system. Staff estimates however f that it will be
4It sometime in July.
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