In-House Recycling and Yard Waste Program City of Saginaw

Rubbish Services  Curbside Collection & Disposal of:  Solid Waste  Recycling  Yard Waste  Brush  Convenience Station  Compost Facility Operation  Environmental Enforcement  City Ordinance §50 Solid Waste 2

MMWA Background  MMWA – Mid Michigan Waste Authority  Began in 1991  Created with goal that cooperative communities would receive better pricing and more services  By 1995, rubbish services offered  Today it is a multi-municipal consortium of 35 communities across the Saginaw Valley area  Currently provides City with solid waste, yard waste services, and recycling services

MMWA Members  Albee Twp  Bethany Twp  Birch Run – Village  Birch Run Twp  Blumfield Twp  Brady Twp  Brant Twp  Breckenridge – Village  Bridgeport Twp  Buena Vista Twp  Carrollton Twp  Chapin Twp  Chesaning - Village  Chesaning Twp  Frankenmuth - City  Frankenmuth Twp  Fremont Twp  James Twp  Jonesfield Twp  Kochville Twp  Lakefield Twp  Maple Grove Twp  Marion Twp  Merrill – Village  Richland Twp  Saginaw – City  Saginaw Twp  St Charles – Village  St Charles Twp  Spaulding Twp  Swan Creek Twp  Thomas Twp  Tittabawassee Twp  Wheeler Twp  Zilwaukee – City

MMWA Current Contract  10 year contract expired December 31, 2014  1 Year Extension Expires December 31, 2015  Recycling eliminated in 2003 and then reintroduced in Spring of  Fees include collection, disposal, administration, fuel, and landfill surcharge  No disposal fee associated with yard waste 5

Current Collection Zones 6

MMWA Current Contract Cost Per Household-Actuals 7 Fiscal YearMMWA Household Cost 2005$ $ $ $ $ $ $ $ $ $ Estimated$117.70

MMWA Proposed Contract  Proposed 10 year contract  Jan 2016 – Dec 2025  Fees based on house count, not participation  Continued yard waste disposal at City compost site  Collection fees will increase 16% the first year and then annually at a varying rate between 2% and 3.4% 8

MMWA Proposed Cost Increases YearMMWA CostsIncrease 2015$2,277,485Base 2016$2,443,279$165, $2,480,423$37, $2,527,780$47, $2,576,322$48, $2,626,077$49, $2,681,156$55, $2,744,007$62, $2,808,743$64, $2,879,867$71, $2,957,855$77,987 TOTAL$26,725,513$680,370 9

Rubbish Fund Revenues  $175 rubbish fee is assessed per household  Current house count at 19,356 households  Compost tipping fees  Other revenue comes from environmental cleanup and misc. fees  Negative revenue value comes from chargeback 10

FY16 Anticipated Rubbish Revenue Type of ServiceRevenue% of Revenue Rubbish Fee$3,387, % Compost Site Tipping Fees & Sales$268, % Other$94, % Chargeback($100,000)(2.74%) Total$3,649,940100% 11 Based on budget as of March 2015

FY16 Anticipated Rubbish Revenue 12 Based on budget as of March 2015

Rubbish Fund Expenditures  Fund pays for services and also legacy costs  MMWA contract fees include all costs for solid waste, recycling and yard waste  Other expenditures are for services offered by City  Legacy costs have been totaled for all rubbish services 13

FY16 Projected Rubbish Expenditures Type of ServiceCost% of Expenditure Administration$404, % Solid Waste$1,582, % Yard Waste$304, % Recycling$437, % Brush Collection$212, % Compost Operations$420, % Convenience Station$25, % Environmental Enforcement$232, % Legacy$377, % Total$3,996,133100% 14 Based on budget as of March 2015

FY16 Projected Rubbish Expenditures 15 Based on budget as of March 2015

FY16 Projected Rubbish Deficit  The projected deficit is: $346,193  As MMWA fees increase, the deficit will continue to grow if no changes are implemented  Increasing the rubbish fee would require a minimum increase of $17.90 per household  Decreasing expenses by more than the deficit is the only other alternative 16 Based on budget as of March 2015

17 FY 2016 Household Cost by Service Type of ServiceHousehold Cost Administration$15.69 MMWA Services$ Brush Collection$10.96 Compost Operations$7.86 Convenience Station$1.32 Environmental Enforcement$10.20 Legacy$19.52 Other$5.91 Total$ Based on budget as of March 2015

Comparable Rubbish Fees  Farmington $  Solid Waste/Yard Waste/Recycle  Battle Creek $  Solid Waste/Yard Waste/Recycle  Lansing $  Solid Waste/Yard Waste/Recycle  Bay City $  Solid Waste/Yard Waste/Recycle/Brush  Saginaw Township $  Solid Waste/Yard Waste/Recycle 18 Fees as of August 2013

Rubbish Fund Fiscal Overview  FY16 projected revenue: $3,649,940  FY16 projected expenditures: $3,996,133  FY16 project deficit: $346,193  Ideal solution is to reduce expenses or increase revenues, maintaining the same level of services 19 Based on budget as of March 2015

Proposal  Bring recycling and yard waste back in-house following current pickup schedule  MMWA would continue with weekly solid waste collection and disposal  The City would continue all other in-house services as currently proposed. 20

2016 MMWA Estimated Fees Type of CostTotal Costs Solid Waste$1,659,215 Recycling$434,348 Yard Waste$349,715 TOTAL:$2,443,279 21

MMWA Proposed Cost Increases Per Household YearTotal Costs% Increase 2015$117.66Base 2016$ % 2025$ % 10 Year Average$ % 22

MMWA Proposed Solid Waste Costs YearMMWA CostsIncrease 2015$1,564,564Base 2016$1,659,215$94, $1,681,699$22, $1,710,366$28, $1,739,750$29, $1,769,868$30, $1,803,209$33, $1,841,255$38, $1,880,442$39, $1,923,495$43, $1,970,704$47,208 TOTAL$17,980,007$406,139 23

Recycling  Limited participation  Map participating households by recording GIS data  The City anticipates not driving every street, which MMWA currently does  Efficient routes will be created based on data  Lower costs 24

Recycling Bin Map 25

In-House Annual Cost Analysis 2016 Recycling Type of CostCost Labor$155,209 Equipment$58,776 Operational$102,099 Contingency (10%)$31,608 TOTAL$347,694 MMWA 2016 Recycling Cost = $434,348 26

In-House Recycling Labor Cost  2 full time employees  $36.83/hour average  includes salary and benefits  Annual cost of $63,298 per employee includes salary, benefits, and miscellaneous supplies 27

In-House Recycling Equipment Cost  The City will budget for 1 new recycling truck, and 1 used back up yard waste/recycling truck  The total annual cost is $58,776  This cost includes the cost of equipment and financing 28

In-House Recycling Operational Cost  Operational costs annually will be $102,100  Costs include:  Equipment maintenance  Insurance  Fuel,  Software package  Disposal of recyclables 29

Estimated In-House Recycling Savings for 10 year Contract YearMMWA CostIn-House CostSavings 2016$434,348$347,694$86, $442,013$347,694$94, $451,786$347,694$104, $461,803$347,694$114, $472,071$347,694$124, $483,437$336,631$146, $496,407$336,631$159, $509,766$336,631$173, $524,444$336,631$187, $540,537$336,631$203,905 TOTAL$4,816,617$3,421,632$1,394,984 30

In-House Yard Waste  MMWA yard waste charges are based on a reduced house count  MMWA disposal volume is based on a 10 year average, not an actual measurement  Because yard waste disposal from the City is not measured, dumping fees may be inaccurate  Efficient routes will be created based on collected GIS data 31

In-House Annual Cost Analysis 2016 Yard Waste Type of CostCost Labor$69,899 Equipment$69,009 Operational$62,000 Contingency (10%)$20,090 TOTAL$220,999 MMWA 2016 Yard Waste Cost = $349,715 32

In-House Yard Waste Labor Cost  2 full time employees  Seasonal (8 months)  $24.46/hour average  Includes salary and benefits  The overall cost of $34,949 per employee includes salary, benefits, and miscellaneous supplies 33

In-House Yard Waste Equipment Cost  The City will budget for 1 new yard waste truck, and 1 used yard waste truck  The total annual cost is $69,009  This cost includes the cost of equipment and financing 34

In-House Yard Waste Operational Cost  The City has determined that operational costs annually will be $62,000  This costs includes equipment maintenance, insurance, fuel, and software package 35

Estimated In-House Yard Waste Savings for 10 year Contract YearMMWA CostIn-House CostSavings 2016$349,715$220,999$128, $356,709$220,999$135, $365,627$220,999$144, $374,768$220,999$153, $384,137$220,999$163, $394,509$209,936$184, $406,344$209,936$196, $418,534$209,936$208, $431,927$209,936$221, $446,613$209,936$236,676 TOTAL$3,928,888$2,154,681$1,774,207 36

Yard Waste and Recycling 10 Year Savings YearMMWA CostIn-House CostSavings Recycling ( ) $3,928,888$2,154,681$1,774,207 Yard Waste ( ) $4,816,617$3,421,632$1,394,984 TOTAL ( ) $8,745,505$5,576,313$3,169,192 37

Strengths Significantly reduces cost City regains control Improves efficiency Accurately measuring other communities yard waste Opportunities Increase the number or level of services Use data collected to focus education efforts Potential to combine brush and yard waste collection Threats Large volume change in recycling and/or yard waste collection would create an extreme cost increase Weaknesses Administration and complaints will take time and resources Conservative 10 year cost averages were used, but market conditions can change unpredictably SWOT ANALYSIS 38

Summary 39  Do nothing and enter into MMWA 10 year contract YearCostCost per Household 2016$2,443,279$ $2,957,855$  Bring recycling and yard waste in-house YearCostCost per Household 2016$2,227,908$ $2,517,271$130.05

Questions? 40