A Suburban Garbage Services truck picks up trash in South Salem. Salem City Council rose garbage rates Tuesday. (Troy Brynelson/Salem Reporter files)
Your garbage rates will get a bit of a hike at the start of 2019.
The Salem City Council Tuesday raised collection fees for garbage and recycling, after haulers have reportedly struggled to turn a profit in a tumultuous year for their industry.
Waste haulers, processors and others in the waste collection industry say costs increased after China stopped importing recyclables last year, closing the door to a major customer for many businesses across the world.
Disposal fees at landfills rose as well, according to a staff report released last week, as have prices for diesel fuel used by garbage trucks.
Councilors voted unanimously to raise the rates. Rates vary for customers in Marion and Polk County based on where garbage and recycling is handled. The average customer in Salem uses a 35-gallon bin, according to city officials, who will now pay $29.50 a month in Marion County and $23.85 in Polk County.
Customers with 20 gallon bins will pay $18.35 in Marion County per month or $16.65 in Polk County. A customer with a 65-gallon bin will pay $38.45 in Marion or $28.85 in Polk.
Before voting, councilors deliberated how to keep collection rates from rising. The city and haulers had already agreed on the 2019 rates last year, but economic conditions came on stronger than the industry expected and some reported considerable losses.
“When China decided to stop buying recycled material, it affected not just our local area. It’s a worldwide situation,” Will Posegate, chief operating officer of Garten, told councilors. “It’s kind of a perfect storm in a business sense.”
Under a franchise agreement with the city, haulers are assured 10 percent operating profit. Keeping haulers afloat with collection fees is in the city’s best interest, said Franchise Administrator Ryan Zink, because otherwise the ask falls to the city and becomes more expensive.
“If we were to do nothing and we had this really low return on revenue (for haulers), we could potentially see these companies go out of business and see our costs go up overall?” asked Councilor Cara Kaser.
“Yes I think that would be a fair assessment,” said Zink.
Councilors also considered the environmental costs of the policy to send waste from Marion County to an incinerator owned by energy company Covanta. The incinerator burns trash to generate electricity but is generally more expensive than a landfill and some wondered if its carbon emissions undercut any benefit of generating electricity. Councilors Chris Hoy and Sally Cook advocated for a work session to study that further.
“I think we need to be looking at all the costs around Covanta and get a better fuller understanding,” Hoy said.
Councilor Brad Nanke and Mayor Chuck Bennett ended discussions by wondering how collection fees could be kept flat. Nanke worried fuel and labor costs will keep rising and, eventually, lower-income households might cancel the service. Bennett asked staff to keep track of whether that starts to happen next year.
“Some place there is a number where people drop service and start piling it up in the backyard and garage, and I want to make sure we’re keeping close track of that,” Bennett said.
At the three-hour meeting, council also dismissed a motion from Councilor Tom Andersen that proposed to pay councilors and the mayor a monthly stipend, and decided to opt for deciding for itself the future of the Kuebler Gateway Shopping Center.
The council also agreed to help local businesses pursue a grant from the Oregon Department of Aviation. Several businesses are leading a private charge to help lure commercial air service back to Salem Municipal Airport.
And the council sent back a proposed ban on plastic bags, which they voted on at the last meeting, to tweak language of the ordinance regarding a 5-cent charge for paper bags.
Have a tip? Contact reporter Troy Brynelson at 503-575-9930, [email protected] or @TroyWB.