Backgrounder: City of Toronto Rate Supported Budget for Solid Waste Management Services
Solid Waste Management Services is a rate-based program where residents pay fees for the services they receive based on the size of their garbage bin. The volume-based rate structure was designed to encourage residents to divert as much as possible away from landfill. Residents with the largest garbage bins pay the most and those with the smallest pay the least.
As part of the Long Term Waste Management Strategy (Waste Strategy), which was approved by City Council in 2016, the City is working towards a goal of 70 per cent diversion of waste away from landfill by 2026 and a circular economy. The recommended 2019 Budget provides funding to support the continued implementation of the Waste Strategy and the long-term financial sustainability of Solid Waste Management Services’ operations and capital projects.
Solid Waste Management Services overview
- Provides solid waste collection services to almost 900,000 residential homes, businesses, institutions, charities, religious organizations, schools, and City divisions, agencies and corporations. Services include collection and management of Green Bin organics, Blue Bin recycling, garbage, oversized waste, yard waste, electronics and household hazardous waste.
- Maintains and services over $535 million worth of infrastructure assets including seven Transfer Stations (six with Household Hazardous Waste Depots); one operating landfill – Green Lane Landfill and 160 closed landfills; two Source-Separated Organics Processing Facilities (one undergoing expansion); and five work yards.
- Supports city beautification and cleanliness by collecting garbage and recycling from approximately 10,000 park bins and 9,500 street bins and providing cleanup for more than 1,000 special events a year.
- Manages approximately 900,000 tonnes of waste each year.
- A 2.2 per cent blended rate increase, expected to generate approximately $10.8 million and retroactive to January 1, 2019 is recommended.
- Rate increases vary based on customer group. Multi-Residential properties (apartment buildings and condos) have a recommended rate increase of 1 per cent. Single Family Residential and Residential Units Above Commercial Properties have a recommended rate increase of 2 per cent. Non-Residential customers (industrial, commercial, institutional properties, schools, as well as City divisions, agencies and corporations) have recommended rate increase of 5.2 per cent. Detailed rate charts are available in Appendix A.
- Differential rates per customer will allow for greater financial sustainability and full cost recovery by customer type.
The recommended 2019 Solid Waste Management Services budgets consist of an:
- Operating Budget of $391.6 million plus a capital reserve contribution of $20 million;
- Capital Budget of $84.6 million (comprised of $39.6 million in new 2019 funding and $45 million in funding carried forward from 2018); and a
- 10-Year Recommended Capital Plan of $686.3 million.
Key opportunities for 2019
- Continued implementation of the Long Term Waste Management Strategy including waste reduction, reuse and circular economy initiatives;
- Continued public education/outreach and monitoring and initiatives related to reducing contamination in the Blue Bin recycling stream;
- Upgrading of biogas to renewable natural gas (RNG) that can be used to fuel collection trucks (reducing GHG emissions) and potentially generate new revenue; and
- Continued conversion of the Solid Waste Management Services collection fleet from diesel to Compressed Natural Gas (CNG) to reduce noise, greenhouse gas emissions and fuel costs.
Changes to the Solid Waste Rebate
- Most Solid Waste Management Services single-family and multi-residential ratepayers currently receive a rebate or credit on each utility bill, funded from the property tax base.
- After a pause in the reductions of the single-family rebate in 2018, it is recommended that both the single-family and multi-residential rebates be completely phased out over the next four years.
- The City’s Long Term Waste Management Strategy recommends that Solid Waste Management Services become a fully self-sufficient and sustainable utility. Phasing out the rebate will support the transition to a model where operating expenses are fully covered by revenues and property tax subsidies are no longer part of the financial model.
- The single-family residential large garbage bin rebate will be phased out in 2019, the medium garbage bin rebate over 2019 and 2020 and small garbage bin rebate over 2019, 2020 and 2021.
- The multi-residential rebate will be phased out over three years beginning in 2020. It will not be reduced in 2019 to allow for the implementation of a proposed multi-residential mandatory diversion program in late 2020 or early 2021.
- The proposed reductions to the single-family residential rebate in 2019 will provide approximately $35 million to the property tax budget.
- Phasing out the rebate does not change the principles behind the volume-based rate structure. Even when the rebate is completely phased out, the small garbage bin will still be more than $200 less expensive on an annual basis than the extra-large bin.
Support for low-income residents
- To minimize the impact of reductions to the Solid Waste Rebate on low-income ratepayers, Solid Waste Management Services is recommending a Single-Family Residential Low Income Relief Program, which will be incorporated into the existing Water Rebate Program.
- The Solid Waste Single-Family Residential Low Income Relief Program will apply to small, medium and large garbage bin customers, and in alignment with the Water Rebate Program, accounts associated with seniors or those living with a disability who have a combined household income below the eligibility threshold (set at $50,000 for 2018, subject to change this year). Extra-large garbage bin or bag-only customers will not be eligible for the program.
Media contact: Solid Waste Management Services: Tamara Staranchuk, Strategic Communications, 416-392-4716, Tamara.Staranchuk@toronto.ca