Good news: your garbage bill isn’t going to go up as fast

This morning, Seattle Public Utilities presented its proposed solid waste rates for 2020-2022. And for once, there was good news: the rates aren’t going up as fast as was predicted in the utility’s Strategic Business Plan.

Rates will go up 3.2% next year, instead of the original 4.0%; in 2021 the increase will be 2.9% instead of 3.0%, and in 2022, the increase stays at 2.9% instead of 3.8%.

There are four reasons for the lower rates:

  1. SPU negotiated a better contract with its service providers. That saves the utility about $5 million per year.
  2. Demand for solid waste services has increased, particularly at the north transfer station where they are seeing 70% more tonnage than predicted, netting more revenues (after an increase in operating expenses to provide the additional service). Some of that is construction waste, and some is that Seattle residents are now taking their solid waste there where they previously took it to a King County transfer station while the North transfer station was being rebuilt.
  3. Relatively new financial policies are leading to more cash reserves.
  4. The Utility Discount Program projections were off; SPU is seeing fewer single-family homes enrolled in the program, and more homes in multi-family buildings — which are cheaper to serve, lowering expenses.

Those savings were partially offset by two other factors:

  • The South Recycling Center will be rebuilt in 2020 and 2021, which will be a significant capital cost.
  • China’s refusal to take most recycling materials from the U.S. has depressed the market price for recyclable materials, decreasing SPU’s revenues.

 

The City Council will officially approve the new rates as part of the 2020 budget in November.


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