For City Council Meeting May 26, 2026
TO: Honorable Mayor and City Council
APPROVAL: Tanya Williams, City Manager
FROM: Yazdan Emrani, P.E., Director of Public Works
Title
Request City Council Adopt Resolution No. 8517 Approving Municipal Solid Waste Collection, Recycling, Organics, and Disposal Rates for Fiscal Year 2026/2027.
(ACTION)
Body
RECOMMENDATION
Staff recommends that the City Council adopt a resolution approving municipal solid waste collection, recycling, and disposal service rates for Fiscal Year (FY) 2026/2027, effective July 1, 2026.
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.
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 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 FY 2023/2024 through 2026/2027. These rates incorporated a new Mixed Organics Waste (Food Waste) Recycling component.
The City incurs costs for providing solid waste collection services (City Costs). R3 Consulting Group, Inc. (R3) was previously engaged to review, analyze, and quantify the annual amounts of these costs. The result of that engagement was a Solid Waste Franchise Fee Study, dated June 13, 2024.
ANALYSIS/DISCUSSION
The City of Rialto has contracted R3 to review, analyze, and quantify City Costs to update the Prior Study. This updated study, included as Attachment 1, considers current best practices in the field of cost studies and updates the prior costs, in some cases, including new costs identified by the City since the Prior Study.
R3 reviewed and analyzed information provided by the City pertaining to City Costs. R3 used the information provided by the City, as well as information obtained via research and analysis, to calculate the annual amounts for the City’s provision of solid waste collection services.
All calculated amounts in this Study are in FY 2025-2026 dollars; however, most City Costs were provided in FY 2024-2025 dollars and were then escalated by the 4.3% average annual change in the seven-year CPI (All items in Riverside-San Bernardino-Ontario, CA, all urban consumers, not seasonally adjusted). This CPI has only existed for seven years; therefore, the seven-year average includes the most available data.
The annual costs for management, administration, regulatory compliance and enforcement, solid waste collection and clean-up, and other obligations associated with the Contractor’s Agreement and the sanitation system include: staffing salary and benefits, contracted services, and overhead for distributed costs including, but not limited to, property, utilities, insurance, human resources, payroll administration, accounts payable and receivable, and other finance functions.
Staffing costs are calculated based on estimated time allocations (based on assessment of current City employees) and other costs are calculated based on estimated share allocations associated with the sanitation system, with distributed overhead applied to both.
The prior study in FY 2023-2024 found that City’s Costs totaled $2,315,290 ($1,275,260 in staffing costs and $1,040,030 in other costs). If adjusted for the same CPI, those costs would now be worth $2,518,686.
The calculation results for FY 2024-2025 are $1,071,332 in staffing costs and $1,065,518 in other costs, for the annual proportionate City’s Costs totaling $2,136,850. For FY 2025-2026, after escalating by the 4.3% average annual change in the seven-year CPI, annual City Costs are estimated at $2,228,735. This represents a reduction of costs in the amount of $289,951.
The proposed rates for FY 2026/2027 are included in Attachment 2, and the following tables are a sample of the most common customer rates. These rates reflect the reduction in Franchise Fees equal to the reduction in annual City costs for Residential and Commercial accounts as identified in the fee study by R3.
In addition to the reduction in Franchise Fees, Approval of Amendment No. 9 to the Waste Disposal Agreement (WDA) is anticipated to provide additional long-term stability and potential savings in solid waste disposal costs, which may further reduce future trash rate adjustments if all fifteen participating cities and towns approve the amendment. The proposed amendment extends the current agreement through June 30, 2035, and establishes a revised contract disposal rate equal to 83% of the County’s posted gate rate beginning July 1, 2026, resulting in an initial WDA rate of $41.08 per ton. By securing stable and predictable disposal pricing, subject only to CPI increases and government-imposed mandates or legal changes, the amendment supports continued cost control for refuse services while ensuring reliable long-term landfill disposal capacity and sound environmental management practices through the San Bernardino County Solid Waste Division.
Attachment 3 includes additional rate schedules that reflect the reduced WDA tipping fee. These adjusted rates demonstrate the potential decrease in trash service rates that would result from approval of Amendment No. 9 to the Waste Disposal Agreement. The revised rates are provided for informational purposes and illustrate the anticipated cost savings associated with the reduced landfill disposal fees.
Proposed Residential Rates
The proposed 2026/2027 residential rates are identified in Table 1 below.
Table 1
Residential Rates
Proposed Commercial Rates
FY 2026/2027 rates for Commercial customers are recommended to include the following components:
• CPI adjustment for the FY 2026/2027 Commercial Hauler Fee is equal to 3.28%.
• An increase in the recycling fees from $4.15/yard to $4.30/yard.
• An increase in the Multi-Family Bulky Program from $1.68/yard to $2.02/yard.
• Decreases in the Food Waste recycling fees from $1.06/yard to $0.85/yard.
• No change to the Windy Day Tonnage charge (will remain at $0.00/yard).
• WDA solid waste disposal rate (If approved by all 15 member cities it will initially be $41.08 per ton; a $0.99 reduction from the current rate of $42.07.)
Table 2 below shows the most common Commercial Service levels with the proposed FY 2026/2027 rates.
Table 2
Commercial Rates
Solid Waste Subcommittee Review
At its April 29, 2026, special meeting, the Solid Waste Subcommittee reviewed the proposed rate adjustment.
Cable Advisory and Utilities Commission Review
At its meeting on May 19, 2026, the Cable Advisory and Utilities Commission reviewed the proposed rate adjustment and recommended that the City Council approve the rates as proposed.
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 3 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 waste 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 resolution and approved it as to form.
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 $308,715/year and will be credited to Account No. 22127040-47544.
• HHW funds are estimated to be $314,917/year and will be credited to Account No. 22127041-47542.
• Franchise fees are estimated to be $1,535,321/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.
Attachments
1. Rialto Study of Costs Final Report
2. FY 2026-2027 Rialto Rates
3. Rates if WDA Amendment is Approved by San Bernardino County
4. Resolution