Memo for fiscal year 2017, updated 2016-04-05

[Archived] Why does the proposed budget include an increase of the residential refuse fee to $353 (an increase of 5%) to maintain cost recovery of current services?

Listed below are responses to questions from Vice Mayor Wilson regarding programs and services delivered by the Resource Recovery Division as outlined in the operating budget.

1. Why is the residential food waste composting pilot discontinued in FY 2017? What is the estimated cost to continue the pilot in FY 2017? What would be the estimated cost to expand the pilot in FY 2017? What expansion scenarios are feasible?

The Residential Food Waste Composting Pilot is a three month study scheduled for the spring of 2016. The purpose of the pilot includes gauging public interest and participation, determining operational feasibility, and evaluating the limited regional capacity to compost food waste. The information collected from the pilot study will be used to determine the feasibility for implementation in future years. Given that the pilot has not begun at this time, and there are no plans to continue the pilot in FY 2017, there are no expansion scenarios currently considered feasible. Staff wants to carefully review the results of the pilot as well as review other regional interest since a shared, regional infrastructure is critical for success.

2. What explains the significant increase in Workers Compensation Costs attributed to the Fee?

With regard to actual Worker’s Compensation costs, the increase from FY 2016 to FY 2017 has not been significant. However, the amount of Worker’s Compensation charged to the Residential Refuse Fee has increased 54% from $260,000 to $400,000, though this still does not fully cover the projected costs for injuries associated with collection of residential refuse. This transfer of costs from the General Fund to the Fee is a result of a policy decision to align the Residential Refuse Fee with directly-related costs and is consistent with the City’s policy of budgeting and charging worker’s compensation in departments’ direct program budgets instead of centrally, as was the past practice. This change creates more transparency concerning the actual costs of the City’s programs and gives supervisors greater responsibility for managing their risk management and worker’s compensation. Nevertheless, these Worker’s Compensation costs are relatively high when compared to other activities performed by City staff due to the nature of the work. The Occupational Safety & Health Administration (OSHA) classifies waste-management jobs as among the most dangerous with regard to work-related injuries.

3. What explains the significant decrease in indirect costs (administrative support) being attributed to the Fee? Are those costs instead being borne by the General Fund?

Four years ago, the City purchased new recycling carts for residents who receive City-provided waste collection services. To ‘pay back’ the General Fund, the Residential Refuse Fee was charged four payments over four years (last payment = $172,605). This payment was included in Indirect Costs in FY 2016 and was the last of the payment periods. In much the same manner, the City purchased from the General Fund a tub-grinder for processing wood waste and is charging the Fee an annual amount of $105,600 for seven payment periods. FY 2016 is the second payment period. In FY 2016, both charges were reflected in Indirect Costs. For FY 2017, the recycling cart payback has been completed and the tub-grinder payback has been itemized as part of the Leaf Collection operating expenditures.

4. The City’s Approved Citywide Parks Improvement Plan included a plan for the relocation, replacement, upgrade, supplement and removal of trash and recycling cans at six City Parks (4 Mile Run, Chinquapin, Brenman, Hensley, Holmes Run & Simpson). What is the estimated cost of the uncompleted components of this aspect of the plan?

The estimated cost of the Parks Improvement Plan for the six parks identified would be $145,240, in FY 2013 dollars. Assuming 3% inflation per year, the total for FY 2017 would be $163,469. An inventory and plan is shown below from page 229 of the appendix here outlining the original cost.

33. RRF table

5. In FY 2015, the Council used an increase in the residential refuse fee to expand public space recycling. If Council were to again budget for expansions in public space recycling and public space sanitation cans, how would staff prioritize the existing City need?

Currently, the City has more public trash receptacles than recycling receptacles even though the trash to recyclable ratio is estimated at 50/50. Best management practices for the placement of public waste containers recommend that pairing a trash can with a recycling container generates the most recyclables with the least contamination (a stand-alone trash can is filled with recyclables while a stand-alone recycling container quickly turns into a ‘trash’ can). Staff would prioritize the placement of more public recycling receptacles over those for trash. In addition, the current route for emptying public trash cans is at capacity. Any further increase in public space trash cans would require additional staffing and equipment. The priority for new public waste containers would be for the purchase of more recycling containers.

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