Garbage rates are going up 50 percent for residents of Columbia.
The Board of Aldermen voted unanimously Tuesday night to raise rates across the board for residential and commercial accounts. The city has been losing $7,000 to $10,000 per month on garbage, according to Mayor Justin McKenzie.
Five years ago the Board voted to privatize the city’s trash service, which is currently contracted by Waste Pro. Currently residents pay $10 per month on their water and sewer bills to cover the city’s expenses for trash pickup, but that will increase to $15 on Oct. 1.
The Board discussed options for rate increases, and McKenzie explained why the increase was necessary.
“In May, for garbage service, we lost $7,673. We have a little more than 2,100 customers.”
Ward 2 Alderman Jason Stringer asked about the break-even point for increases. McKenzie answered that $3 per customer would bring the accounts close to even to cover costs, however, there were other factors including possible fuel surcharges and tipping fees at the transfer station.
“If we went up $5, it would bring in an additional $10,000 (per month),” Stringer said.
McKenzie then suggested an across-the-board increase.
“If it were me, I’d go up on all types of accounts,” he said. “We need to go up to whatever that magic number is. If you look at us losing $7,000 per month for 12 months or even $6,000, that’s a tremendous burden on the city’s budget.”
Stringer said that only going up $3 might force the Board to change the city’s ordinance and grant an increase again in a year or two.
“The cost for the garbage is fixed, but there is a fuel surcharge,” City Attorney Lawrence Hahn said. “Fuel has gone down, so that we have not had to account for that in the past.”
McKenzie said the current contract with Waste Pro costs the city $22,955 per month.
“We collected $25,418, but then we have to pay the transfer fee,” he said. “The lowest fee on here was about $7,000 and the most expensive was $12,000. You take the $22,000 and add the transfer fees and you’ve lost money. Basically, you’ve got a debt – you’re in the hole every month. If you want to dig out of the hole, $5 is the way you do that. You are putting a little bit back in there to help.”
Ward 4 Aldermen Mike Smith questioned the contract.
“We may need to look down the road when this lease is up about going back to collecting our garbage,” he said.
The current contract has about a year left, according to the Alderman-at-Large Edward Hough.
“We negotiated with Red River when Reed Houston was mayor, so we’ve got at least four years into the six-year contract,” he said.
Stringer then made a motion for a $5 increase across the board on garbage rates, which was seconded by Ward 1 Alderman Wendell Hammond. The Board then agreed to make the new rates take effect on Oct. 1.
Hahn then explained why the city faced such a loss in the first place.
“The number of household units has dropped in Columbia,” he said. “It’s not that we’re losing money because we’re getting ripped off or anything like that. We have less population than we did at the time the contract was initialized. At the time it was signed, we figured the break-even point based on the population.”
The contract, according to Hahn, gives the garbage company, which was originally Red River and now Waste Pro, a minimum number of homes to be collected.
“We are about the minimum that they would collect and our population has gone down since then,” he said. “What you have voted on is amending the ordinance.”
Stringer said the increase was something that the city had to do.
“It just made more sense to go up $5 now than to go up $3 and have to raise it again in 24 months,” he said.
