A Charge for Waste Management?

The subject of a charge for waste management has recently been discussed in the press, partly as a result of the legal challenges faced by two municipalities that imposed such fees. According to several mayors, the significant subsidy cuts by the central government are the cause of the implementation of programs establishing fees for the collections and disposal (“waste management services”) of non-hazardous waste by municipalities.

Contrary to public perception, the concept is not new. In fact, the process for the implementation of such programs, including alternatives for the invoicing and collection of the corresponding fees is already expressly contemplated in the provisions of the Puerto Rico Autonomous Municipalities Act. It is a myth that we do not pay for waste management services. One of most significant items in any municipality’s budget are the funds appropriated for waste management services. The main difference is that under the “new” waste management programs citizens see a direct and tangible charge or fee for such services.

As with many other things, we are getting into the game really late. Many jurisdictions around the world have in place programs under which citizens directly pay for waste management services. The implementation methods are diverse and vary amongst jurisdictions. Some jurisdictions use fixed or flat fees (e.g., amount per dwelling Arecibo), others use methods that focus on a variable unit pricing (e.g., fee per bag, tag or container) and others prefer a combination of a nominal flat fee and unit price system. Under the unit pricing focused programs, citizens pay or are charged based on the amount of waste they generate. This is commonly known as pay-as-you-throw (“PAYT”) programs. PAYT programs are seen as fairer since citizens would pay for the non-recyclable waste they generate without having to subsidizing other who generate bigger amounts of waste. While PAYT programs have multiple positive aspects, their success is predicated on many factors. PAYT programs successes have in common: (a) a through planning phase which should include conservative cost methods encompassing all costs (direct and indirect, including the adequate closure of non-compliant sanitary landfills) associated to the implementation and operation of the program to enable the calculation of functional fees and realistic projections for potential future fee increases or reductions; (b) the execution of education efforts to inform the citizens about the needs for the program, its benefits and challenges and the new use to which the funds previously appropriated for waste management services will be used in future; (c) competitive bidding processes to foster better prices and services; (d) the exclusive use of the funds generated by the program for waste management services; and (e) compliance with all legal requirements including, but not limited to, public participation processes in order to avoid lack of transparency claims and gather the support of the citizens.

Since PAYT programs typically result in increases of deviation rates of recyclables materials from the waste stream, these programs sometimes are considered as the panacea of waste issues. However, that must not be taken lightly particularly in the fiscal crisis that the municipalities are facing. While the opportunity for the increase of recycling rates is positive, their management requires adequate infrastructure and local markets for their placement in order to shift recycling collections and management expense into a sustainable revenue stream in order to sustain the waste management services once waste generation lowers. Otherwise, we may end up with higher and higher waste management services fees as well as an unmanageable amount of recyclables and the environmental issues associated to such situations.

The solution to our decade’s long waste management crisis would only be achieved through the implementation of an integrated solid waste management system. This recent chapter has highlighted again the magnitude of the crisis and may hopefully move the discussion into actions towards a long term solution.

by Lillian Mateo-Santos, Esq., Ferraiuoli LLC