Section 21-229 of the Billings Montana City Code requires that the City Council annually adopt the Solid Waste collection and disposal charges and landfill fees by resolution.  Public Works staff conducted a cost of service rate study and presented the findings to City Council at the March 3, 2014 Work Session.  The existing solid waste rates and fees are no longer adequate to provide for the operation and maintenance and capital investment necessary to continue providing service at the current level.  Two options to increase rates were presented and discussed at the Council Work Session.  Option 1 increases all rates to the levels needed to adequately cover the cost of service in FY 2015.  Option 2 utilizes reserves to phase in the rate increase for residential and drop box/roll off collection over the next three years.  The proposed rate and fee adjustments include increases for residential and mobile home collection, drop box/roll off collection, and landfill fees.  Commercial collection is currently charged at the level required to cover costs and accordingly, no increase is recommended for commercial collection.  The proposed rates and fees also establish a fee for refuse originating outside of Montana. 

The attached resolution specifies the proposed rates and fees under Option 1.  An alternate resolution is also attached showing the rates and fees under Option 2.  A detailed comparison of current versus proposed rates is attached as well.  A public hearing is required and if the proposed resolution is approved, rates will be effective July 1, 2014.    

The Council must hold a public hearing and then may

• approve the recommended resolution
• approve the alternate resolution; or 
• not approve either the recommended or alternate resolution.  If Council does not approve either resolution, an amended resolution to establish Solid Waste fees for FY 15 will need to be considered at a future City Council meeting.   

The proposed Option 1 rate and fee adjustments will generate approximately $983,940 of collection revenues and $386,230 of landfill revenues for a total increase to the solid waste fund of $1,370,170, as well as approximately $75,000 in franchise fees for the general fund in fiscal year 2015.  Option 2 would also generate $386,230 of landfill revenues.  Collection revenues generated under Option 2 are estimated at $426,374 for a total increase to the solid waste fund of $812,604 and an additional $49,000 in franchise fees for the general fund in fiscal year 2015. 
 

Staff recommends that the City Council conduct a public hearing and approve the proposed resolution adopting collection, disposal, and landfill fees effective July 1, 2014.