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Community---Economic-Development---Fee-Study — Intro

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R ESIDENTIAL CURBSIDE COLLECTION S ERVICE RATE STUDY FOR RATES EFFECTIVE JULY 1, 2024 CITY OF P ORTLAND BUREAU OF P LANNING AND SUSTAINABILITY S OLID WASTE & RECYCLING

This document is available online at www.portland.gov/garbage-rates ↗. For more information please contact: City of Portland Bureau of Planning and Sustainability Solid Waste & Recycling th 1810 SW 5 Avenue, Suite 710 Portland, OR 97201 Phone: (503) 823-7202 email: wasteinfo@portlandoregon.gov

TABLE OF CONTENTS Page I. Introduction and Summary of Rates 1 Table 1. FY 2024-25 and FY 2023-24 Rates for Primary Service Levels 2 Table 2. Rate Components for 35-Gallon Roll Cart Service 2 II. Program Attributes and Performance 3 Figure 1. Household Generation of Garbage, Recycling, and Organics 3 A. Solid Waste 3 B. Recycling 4 C. Yard Debris / Food Scraps 4 III. The Rate Review Process 5 A. Franchise Agreement Requirements 5 B. Key Rate Review Objectives 5 C. Unique Elements of the Rate Review Process 6

  1. Annual Rate Review Process Timing 6
  2. Hauler Reporting Requirements 6
  3. Independent CPA Review of Sample Hauler Financial Data 7
  4. Application of Inflation Adjustments to Calendar Year Cost Data 7
  5. Certain Costs Not Based on Reported Calendar Year Financial Data 8
  6. Operating Margin Methodology 8
  7. Use of Composite Weighted Averages 9 IV. Key Factors Affecting FY 2024-25 Rates 10 A. Recyclable Material Processing Costs 10 B. Forecast Inflation Adjustments 10 Table 3. FY 2024-25 Inflation Adjustments 11 C. Solid Waste Disposal Costs 11 Table 4. Changes in FY 2024-25 Solid Waste Discard Weights 11 D. Organics Disposal Costs 12 E. Incentives and Disincentive 12 Table 5. Incentives and Disincentives in FY 2024-25 and FY 2023-24 rates 12 Appendix A - FY 2024-25 Residential Solid Waste, Recycling and Composting Rates 13 Appendix B - CY 2023 Weighted Average Revenues and Costs (Dollars/Customer/Month) 15

I. INTRODUCTION AND SUMMARY OF RATES 1 The City of Portland’s annual rate study is conducted to evaluate the cost of providing residential solid waste, recycling and composting curbside collection services, and to develop recommended rates for these services for the new fiscal year. This report outlines the rate review process and results for fiscal year 2024-25 (FY 2024-25) rates. Section 9.A(1) of the Franchise Agreement between the City of Portland and franchised residential haulers requires the City to perform an annual rate review to establish a rate schedule for all levels of residential solid waste, recycling and composting service. Rates are developed with the following objectives in mind: • Having uniform solid waste, recycling and composting collection services citywide; • Providing customers with a variety of service level options to meet individual needs; • Identifying the true cost of individual services before adding incentives and disincentives to increase recycling and reduce solid waste generation; and, • Allowing service providers to recover allowable costs and earn a reasonable profit. The Solid Waste & Recycling Program (SW&R) of the Bureau of Planning and Sustainability (BPS) conducts the annual rate review process, assisted by an independent economist. The economist analyzes various factors that affect rates and produces the actual rate calculation. SW&R also contracts with an independent Certified Public Accountant (CPA) to review hauler financial records and with Portland State University (PSU) to sample the weight of solid waste discarded by residential customers. The recommended rates are reviewed by the Planning Commission, a volunteer panel of residents with no hauling industry representation, and then forwarded to City Council for consideration and final adoption. City Council adopted the rates described in this report on May 29, 2024, for an effective date of July 1, 2024. A complete list of rates for FY 2024-25 can be found in Appendix A. Table 1 outlines the adopted rate adjustments for the most common levels of service. Costs underlying the FY 2024-25 rates tend to reflect inflationary adjustments to the costs underlying the FY 2023-24 rates. A few notable factors include: • Recycling processing costs rose from $1.29 to $1.69 per month. • Metro increased the tipping fees it charges for organics and solid waste disposal at its transfer stations by 7.9 and 11.9 percent, respectively. 1 “Residential” in this context means single-family through four-plex dwellings. June 2024 Residential Curbside Collection Service Rate Study 1

Parent: Community---Economic-Development---Fee-Study