Surprise’s reasoning for ending recycling
THE MEDIA: Web.
WHO SAID IT: The city of Surprise. THE COMMENT: “If we maintain existing service levels with recyclables going to a recycling center, rates would need to increase immediately by $1.20 per month.”
THE FORUM:
Aug. 12.
WHAT WE’RE LOOKING AT: Would the city of Surprise have to raise its utility rates to continue its recycling program?
Four stars: True.
ANALYSIS: The city of Surprise suspended its recycling program on Aug.19, citing both rising costs and the plunging value of recyclables.
Surprise recycled nearly 13 million pounds of material last year, according to Waste Management, the company that the city uses to process its recyclables. Now, all the city’s waste will go to a landfill.
Surprise’s recycling program started in 2004 and was paid for by a solid waste enterprise fund generated from residents’ monthly utility bills. It also was supplemented by payments the city received from the recycling processing center for the commodity value of their recyclables. But in January 2018, those checks turned into bills.
Surprise’s contract with its recycling processing center, the Waste Management Northwest Regional Material Recovery Facility, ended in December 2017. This occurred as a global shift in policies reduced the amount of recycling materials accepted by other countries, mainly China. After that, the center began charging the city to process recycling.
According to Mike Gent, Surprise’s public works director, the city had to shell out more than $300,000 from its reserve funds between January 2018 and May of this year to pay for recycling.
Waste Management offered Surprise a new contract that would have cost the city approximately $500,000 a year, Gent said.
Under that proposed contract, Waste Management would charge Surprise about $103 per ton to process recyclables. Considering they drop off about 9,000 tons a year, this would cost the city nearly $930,000. While Surprise A news release from drops off that much material, due to contamination only 6,470 tons actually are recyclable.
Waste Management still would pay the city for the value of their recyclables, which changes frequently but is estimated to be about $400,000 annually, according to the contract.
That means the city would owe about $530,000 to Waste Management each year.
The amount owed would put the city $250,000 under their reserve fund minimum by June 2020. The City Council has mandated that the city keep enough in reserve funds to pay for 90 days of operating and maintenance expenses.
To account for this gap in funding, Surprise said it would have to raise monthly utility rates by $1.20 starting Jan. 1.
About 37,000 households in Surprise recycle, and charging an extra $1.20 a month would generate $266,400 in the first six months of 2020. Though this is more than the $250,000 estimate, all of the numbers are estimates and the total is in the ballpark.
What caused the change?
In the past, recycling centers depended on other countries, most notably China, to buy and process recyclables. However, that country has significantly restricted the amount and types of recyclables it accepts. This has created a higher global supply of recyclables and a significantly lower demand for them.
China also put a tight cap on the amount of contaminated recyclables it would accept, setting the new threshold at 0.05%. According to Waste Management, 1 in 4 items placed into their bins is not recyclable.
This means recycling centers must spend more time sorting out contaminated materials, and, therefore, cities must spend more money to process recycling.
“We have added labor and slowed down processing lines to hand-pick more contamination from lines at our Material Recovery Facilities,” Mark Snedecor, the Director of Recycling for Waste Management of Arizona said. “We spend extra time quality-checking finished bales to remove any contaminants.”
According to Gent, Surprise used to receive about $15 per ton for their recycling at the Waste Management facility. Now, they are charged anywhere from $20-$90 per ton.
The cost of taking trash to the landfill is about $27 per ton, and so the city decided to divert its recycling to the landfill until a more financially viable solution arises.
“The city of Surprise understands and believes that recycling is a vital part of our future. So we’re committed to finding a recycling partner that is sustainable and reliable for our citizens, but we need it to be a real recycling solution,” Gent said.
“This stance on suspending our recycling program is done with the full intention of saving recycling and making it real in the city of Surprise.”
Other cities were forced to manage rising recycling costs sooner, while Surprise was sheltered from the market’s volatility until their contract expired, Gent said. When it did, officials weren’t prepared for the costly market they were entering.
“We don’t have a contract in place for a recycling partner. Unfortunately, we were not able to come to that agreement,” Gent said. “We’re trying to find a viable, long-term, sustainable partner. Paying more for our current contract doesn’t raise enough attention to the problem that we’re actually in, it just perpetuates that problem further down the road.”
Other cities face recycling crunch
Other cities are responding to the changing recycling market.
Yuma recycles through Republic Services, but their contract ends in 2020. A PowerPoint presentation from a recent Yuma City Council meeting stated, “Economic reset is needed for the long term viability of curbside recycling.”
“We’re at a wait-and-see point to see how contract negotiations go, but there’s a large range of offers on the table,” Dave Nash, the public affairs coordinator for Yuma said.
Tempe also has a contract with Waste Management and is currently conducting a rate study to address rising recycling costs. According to Shannon Reed, a city spokeswoman, there is not yet a decision on whether to raise utility rates.
While some Arizona cities await contract changes, others already have made significant cuts to their recycling programs.
Casa Grande suspended its recycling program on July 1 due to rising costs. Tucson has cut back on its recycling by shifting to an every-other-week pick up schedule.
Another option for Surprise residents
Surprise has closed its recycling drop-off location at 13430 W. Westgate Drive, but Waste Management has provided a location where Surprise residents can recycle items from a limited list.
The center on 19401 W. Deer Valley Road will accept “clean and dry” recyclables every Saturday throughout the rest of the year from 8 a.m. to noon, including:
❚ Aluminum cans.
❚ Plastic bottles.
❚ Plastic milk jugs.
❚ Tin and steel cans.
❚ Flattened cardboard.
❚ Plastic laundry detergent containers.
The Waste Management center will not accept any paper, plastic items not included in the list or any food and liquids.
BOTTOM LINE: If Surprise were to continue recycling at the Waste Management center, officials would have to raise citizen’s utility rates by $1.20 to maintain an appropriate balance in their reserve funds.
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