Faced with a budget shortage of around $100 million, Los Angeles elected officials are back to a proven formula to weather a challenging financial era.
On Wednesday, two city council committees focused on public works, the other focused on environmental issues — approved plans to raise garbage pickup fees over the next five years, with the first hike being the biggest to flock.
Under the plan, waste recovery fees will rise for an estimated 740,000 customers in three- or four-unit detached homes, duplexes and apartment buildings. These customers put waste in black, blue and green bins. This is empty once a week by city workers.
Monthly garbage fees for single-family homes and double-chains will increase by 54% for next year’s budget year, reaching $36.32 to $55.95. The monthly fee for small apartment buildings (three or four-unit buildings) increases from $24.33 to $55.95.
The garbage fee proposal heads all over the city council for Friday’s vote. If the plan is approved, the city’s attorney will draft an ordinance establishing a higher fee. This also requires council approval.
The committee’s vote came on Wednesday as city leaders were trying to erase a massive budget shortage. Mayor Karen Bass is scheduled to announce plans to close the budget and financial gap on April 21st.
Councillor Katy Yaroslavsky, who heads the Council’s Budget Committee, and Council Chairman Marqueece Harris-Dawson, recently called on urban policy analysts to find new opportunities to generate revenue, such as “the right level to achieve cost recovery.”
Officials with the city’s health department said existing trash charges didn’t generate enough money to cover the true cost of garbage collection. The general fund budget, which pays for public safety and other basic services, makes up for the difference, they said.
If fees do not rise, the General Fund will be forced to absorb more than $200 million in expenses for the next budget year, starting July 1st, health officials said.
“When we’re trying to think about how many people, it’s a game changer [city] Councillor Eunice, who represents parts of the city’s East Side, said at a joint committee meeting Wednesday:
Yaroslavsky agreed, saying that charging less than the real cost of garbage collection “is a bad budget, especially since we look at a billion-dollar deficit.”
“It’s absolutely necessary for us to do this,” she said.
Councillor Adrin Nazarian voted the only vote against, saying he was worried that city officials had been too long to raise the fees. Nazarian suggested that the council schedule a study in 2028 to reassess those rates. It’s an idea that was rejected by his colleagues.
The first round of rate increases are expected to generate more than $200 million over the entire calendar year, according to city manager Matt Zabo, the city’s top budget analyst.
If the fare hike goes into effect by October 1, the Department of Health will likely generate another $90 million next year. If the increase comes into effect on Jan. 1, they would produce another $49 million, officials said.
Under the city’s proposal, trash charges will continue to rise until 2029. In the final year, detached houses and apartments with 2-4 units will be charged $65.93 per month for garbage collection.
For single-family homes and double-chains, that represents an 81% increase this fiscal year. For a three- or four-unit apartment, the price is almost triple. The large apartments are not covered by planned trash rate hikes.
This increase will appear in bills issued under the line item “Solid Resource Fees” based on the gap between the Water and the Ministry of Power.
The Department of Health is also trying to raise the fees for removing bulky items such as mattresses and sofas, and plans to increase the number of customers who are charged that fee.
Sanitation officials said agencies need an increase to absorb more equipment, higher salaries and expensive new organic waste programs.
Szabo said the Department of Health has spent tens of millions of dollars on compliance with California Senate Bill 1383, requiring a decouple of organic waste from landfills.
“The state doesn’t allow us to throw food into the trash anymore. That would cost more money,” he said.
The council last hiked garbage fees 17 years ago when Antonio Villaraigoza was mayor. During his first term, Villaraigosa managed to triple customer bills over three years.
In 2006, Villaraigosa said a fee increase would be required to cover plans to hire 1,000 officers. By 2008, additional funds were also needed to help cities get into the budget crisis due to the global economic recession of 2008.
On Wednesday, several councillors demanded that the city know why it had been waiting so long to ask for a higher garbage fee. Sarai Baga, chief financial officer of the Department of Health, told them that rate hiking was being discussed around 2017 and 2018, “the political headwinds didn’t support it at the time.” Once the Covid-19 pandemic began, the idea was delayed again, she said.
Jack Humphreville, a volunteer for budget advocates for watchdog organization Neighborhood Council, accused council members of pushing for fee proposals without enough time for the public to weigh in.
The agenda for Wednesday’s committee meeting was posted exactly a day ago, he said. Only one person testified during the meeting.
“It’s all in the final moments,” Hanfreville said. “There was no outreach, no transparency, nothing.”
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