Charges for Services – Charge a Fee to Non-profits that Receive City Garbage Collection

Revenue: $300,000

Since at least 2001, the Bureau of Sanitation in the Department of Streets and Sanitation (DSS) has provided free garbage collection to various non-profit organizations.  This service is provided if the collection can be easily absorbed into the route without creating a health and safety problem.  With the exception of schools and religious institutions (presumed automatically to be non-profits), each non-profit requesting City garbage collection must provide documentation to DSS (establishing and) attesting to its non-profit status.  As of March 2010, DSS was providing collection service to 1,330 non-profit organizations.[1]  DSS currently serves 600,000 households, thus these 1,330 non-profit organizations represent 0.22% of DSS’s customers.  The overall budget for residential garbage collection is shown in the table below.

Personnel Costs

Title

Budget Number of Full Time Equivalents

Current Annual Payroll

Fringe Benefits @ 35% of Salary

Total Compensation Costs

2012 Costs with 3.5% Increase in Salary

Sanitation Laborers

631

$41,478,522

$14,517,483

$55,996,005

$57,955,865

Motor Truck Drivers*

465

$32,509,252

$11,378,238

$43,887,490

$45,423,552

Supervisory and Clerical Staff- Refuse

166

$12,066,707

$4,223,347

$16,290,054

$16,290,054

Supervisory and Clerical Staff- Waste Disposal

1

$64,248

$22,487

$86,735

$86,735

Subtotal

1,263

$86,118,729

$30,141,555

$116,260,285

$119,756,207

* Includes 1 Chief Dispatcher Position

Non Personnel Costs

Number of Trucks

Daily Cost per Truck

Annual Cost Per Truck

Total Annual Costs in 2011

Total Annual Costs in 2012

Truck Costs-Recycling Collection

350

$343.67

$86,605

$30,311,694

$30,311,694

Waste Disposal Costs

$42,294,993

$42,294,993

Grand Total

$188,866,972

$192,362,894

 

 

 

 

 

 

Note #1: Assumes that the health insurance and pension benefits of these employees are worth 35 percent of their salaries
Note #2. Hours worked are converted to full-time equivalent positions at a rate of 2,040 hours per year
Note #3. This ignores additional costs due to overtime or savings due to personnel vacancies.
Note #4. This assumes that only Sanitation Laborers and Motor Truck Drivers will receive salary increase in 2012
Note #5: Assumes no increase in Waste Disposal or Truck Costs in 2012
Note #6: Annual truck costs assume 252 operating days annually

Under this option, the City would charge each of these organizations a fee to pay for the cost of the garbage collection.  Similar to the pay-as-you-throw (PAYT) system described in a previous option, the City would charge each organization $100 per year for each 96-gallon recycling cart the building used.  On average, there are 2.5 garbage carts per household served in the City.[2]  Assuming each of these organizations currently has, on average 2.5 carts, the $100 charge would raise $332,500.  With some cost in the billing and collection of this fee; assume that this would raise net revenue of approximately $300,000.

It is likely that these organizations have more than the average of 2.5 carts per household, as these organizations likely generate significantly more waste than an average household.  Thus, this revenue estimate is likely conservative.  However, it does not take into account a reduction in the number of carts in service due to the imposition of this fee.

Proponents might argue that the City cannot afford to provide this service to non-profits. Additionally, the City provides many subsidies to non-profit organizations such as, property and sales tax exemptions and free water and sewer service (see page 29).

 

Opponents might argue that if the City were to eliminate this service, the non-profits currently being served would have to absorb the cost of garbage collection and reduce their spending on the services they provide. Additionally, some may argue that non-profits provide public services and it is logical for the City to help subsidize these services.

 

 

 

 

Budget Details

Fund: Corporate Fund, 0100 Type of Revenue: Local Non-Tax Revenue, Charges for Services
The appropriation is located on page 17 of the 2011 Annual Appropriation Ordinance. http://www.cityofchicago.org/content/dam/city/depts/obm/supp_info/2011BudgetOrdinance.pdf

 


 

 


[1] Source: Department of Streets and Sanitation

[2] 1.5 million garbage carts serving 600,000 households.