For Utilities Commission Meeting [May 20, 2025]
TO: Honorable Utilities Commission Members
APPROVAL: John Rossi, Interim Utilities Director
FROM: Tim Sullivan, Assistant City Manager
Title
Municipal Solid Waste Collection, Recycling, Organics, and Disposal Rates for Fiscal Year 2025/2026.
RECOMMENDATION
Staff Request Utilities Commission to Recommend that City Council Approve Municipal Solid Waste Collection, Recycling, and Disposal Service Rates for Fiscal Year 2025/2026, Effective July 1, 2025.
Body
BACKGROUND
Burrtec Franchise Agreement and Refuse Collection Rates
On April 16, 1996, the City Council approved a Franchise Agreement with Burrtec Waste Industries, Inc. (“Burrtec,” formerly EDCO Disposal Corporation) for municipal refuse/recycling collection and disposal services. In accordance with the Franchise Agreement, an allowance is made for adjustment of rates to reflect changes in the cost of doing business, as measured by fluctuations in the Consumer Price Index (CPI), published by the U.S. Department of Labor, Bureau of Labor Statistics, for All items in Riverside-San Bernardino-Ontario, CA, all urban consumers, not seasonally adjusted and applicable disposal costs.
On November 5, 1996, the people of the state of California voted in favor of Proposition 218, the “Right to Vote on Taxes Act.” Proposition 218 added Articles 13C and 13D to the California Constitution, implementing restrictions on methods by which local governments can create or increase taxes, fees, and charges without taxpayer consent. Specifically, Proposition 218 requires the City to provide certain notifications of new or increased assessments, charges, and user fees, and in certain cases, requires a balloting and election of property owners prior to implementing any new or increased assessments, charges, and user fees.
Pursuant to Article 13D of the California Constitution, (Article 13D), a "fee" or "charge" means any levy other than an ad valorem tax, a special tax, or an assessment imposed by an agency upon a parcel or upon a person as an incident of property ownership, including a user fee or charge for a property related service. “Property-related service” means a public service having a direct relationship to property ownership. Section 3 of Article 13D allows the City to assess a fee or charge for property-related services upon any person as an incident of property ownership. Pursuant to § 6 of Article 13D, the City must follow prescribed procedures for imposing or increasing any fee or charge for property-related services.
In 1997, the California Legislature approved the “Proposition 218 Omnibus Implementation Act”, adding California Government Code §§ 53750-53758. This Act incorporated regulations necessary to implement the intention of Proposition 218, to ensure local government followed the appropriate process to establish new or increase existing assessments, charges, and user fees. Of importance, California Government Code § 53750 clarified that an “increase” as applied to a property-related fee or charge does not occur when the increase “adjusts the amount of a tax or fee or charge in accordance with a schedule of adjustments, including a clearly defined formula for inflation adjustment that was adopted by the agency prior to November 6, 1996.” Since the City’s Franchise Agreement with Burrtec was approved before November 6, 1996, the City is empowered to annually increase and adjust rates and charges for refuse collection services.
The California Government Code § 53756 allows an agency providing refuse collection services to adopt a schedule of fees or charges authorizing automatic adjustments that pass-through adjustments for inflation if it adopts the schedule of fees or charges for a property-related service for a period not to exceed five years pursuant to the California Government Code § 53755.
On June 27, 2023, the City Council conducted a Public Hearing in accordance with Proposition 218 procedures and adopted Resolution No. 8109, approving the adoption of the Four-Year Municipal Solid Waste Collection, Recycling, Organics, and Disposal Service Rates for Fiscal Years 2023/2024 through 2026/2027. These rates incorporated a new Mixed Organics Waste (Food Waste) Recycling component.
ANALYSIS/DISCUSSION
The proposed rates for the 2025/2026 Fiscal Year are included in Attachment 1, and the following tables are a sample of the most common customer rates.
Proposed Residential Rates
The proposed 2025/2026 residential rates are identified in Table 1 below.
Table 1
Residential Rates
Proposed Commercial Rates
Fiscal Year 2025/2026 rates for Commercial customers are recommended to include the following components:
• CPI adjustment for the FY 2025/2026 Commercial Hauler Fee is equal to 2.61%.
• A decrease in the recycling fees from $4.28/yard to $4.15/yard.
• Decreases in the Food Waste recycling fees from $1.41/yard to $1.06/yard.
• No change in the Multi-Family Bulky Program from $1.68/yard to $1.68/yard.
• No change to the Windy Day Tonnage charge from $0.00/yard to $0.00/yard.
• No change to the WDA solid waste disposal rate (will remain at $42.07 per ton).
Table 2 below shows the most common Commercial Service levels with the various Fiscal Year rates.
Table 2
Commercial Rates
Solid Waste Subcommittee Review
At its April 10, 2025, meeting, the Solid Waste Subcommittee reviewed the proposed rate adjustment.
ENVIRONMENTAL IMPACT
This is not a “Project” as defined by the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a “Project” means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. According to Section 15378(b), a Project does not include: (5) Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.
GENERAL PLAN CONSISTENCY
The City of Rialto General Plan establishes various guiding principles, goals, and objectives through which the City looks to improve the community and protect the quality of life for our residents. This action is consistent with Guiding Principle 3A in the General Plan:
Our City government will lead by example, and will operate in an open, transparent, and responsive manner that meets the needs of the citizens and is a good place to do business.
Approval of this action also complies with the following City of Rialto General Plan Goals and Policies:
Goal 2-34: Achieve waste recycling levels that meet or exceed State mandates. Achieve maximum waste recycling in all sectors of the community: residential, commercial, industrial, institutional, and construction.
Policy 2-34.1: Develop programs that promote reuse and recycling throughout the community.
Policy 2-34.2: Utilize source reduction, recycling, and other appropriate measures to reduce the amount of solid waste generated in Rialto that is disposed of in landfills.
Goal 3-10: Minimize the volume of solid waste that enters local and regional landfills.
Policy 3-10.1: Encourage additional recycling in all sectors of the community.
Policy 3-10.4: Continue to educate the community regarding the benefits of solid waste diversion and recycling, and maintain programs that make it easy for all residents and businesses to work toward City waste reduction objectives.
Goal 5-4: Protect the health and welfare of the public, environment, and economy by providing for the safe and responsible management of hazardous materials and wastes.
Policy 5-4.2: Coordinate City enforcement efforts with San Bernardino County, the California Department of Health Services, the Regional Water Quality Control Boards, and the Air Quality Management District, for the management and disposal of hazardous wastes.
Goal 5-5: Minimize the generation of hazardous waste in Rialto.
Policy 5-5.1: Prohibit unauthorized disposal of household hazardous waste in the Mid Valley County Landfill.
Policy 5-5.2: Encourage and promote practices that will reduce the use of hazardous materials and the generation of hazardous waste at their source, recycle the remaining hazardous wastes for reuse, and treat those wastes which cannot be reduced at the source or recycled.
Goal 5-6: Educate the public and private businesses about proper disposal of hazardous waste.
Policy 5-6.1: Conduct regularly scheduled household hazardous waste roundup and disposal events.
LEGAL REVIEW
The City Attorney’s Office has reviewed the staff report.
FINANCIAL IMPACT
Operating Budget Impact
Refuse revenue is collected by Burrtec Waste Industries. The City derives revenues from the adopted rates including Household Hazardous Waste (HHW) fees and AB 939 revenues, which the City uses to fund the Household Hazardous Waste programs and for public education on recycling and protection of the environment.
Revenues presented with changes in the Residential and Commercial fee amounts are estimated as follows:
• AB 939 funds are estimated to be $302,145/year and will be credited to Account No. 22127040-47544.
• HHW funds are estimated to be $308,197/year and will be credited to Account No. 22127041-47542.
• Franchise fees are estimated to be $1,640,771/year and will be credited to Account No. 10100001-47116.
Capital Improvement Budget Impact:
There is no impact to the Capital Improvement Budget.
Licensing
A Business License application and payment of a Business License tax is not required for this action.