March 21, 2016
Tory N. Parrish
Customers could pay more for trash pickup if the governor's plan to hike the fees for dumping waste at landfills is approved, waste haulers said.
“We already pay more fees than anybody else, any other service — except maybe cigarettes. We don't think that's a good way to raise revenue to deal with the very, very significant financial issues that are going on in the state,” said David Buzzell, lead counsel for the Pennsylvania Waste Industries Association, which represents private-sector waste haulers, recyclers and landfill operators.
To help close a deficit that is expected to hit $2 billion in 2017, Gov. Tom Wolf included in his 2016-17 proposed $32.7 billion budget a plan to increase the state fee that trash haulers pay for each ton of municipal waste dumped in landfills.
The “tipping fee” would increase by $1.75 per ton — going from $6.25 to $8 per ton — to help pay for environmental programs that had been funded by revenue from leasing state lands for oil and gas drilling.
The proposal also would apply the total $8-per-ton tipping fee to the disposal of construction and demolition waste, as well as non-hazardous residual waste from industrial, mining and agricultural operations — all of which are exempt from tipping fees. Landfills would collect the fees from haulers.
Of the new revenue, $15 million would go to the Hazardous Sites Cleanup Fund and $35 million would be deposited into the Oil and Gas Lease Fund, the latter of which has been improperly used and depleted in the past few years to pay for state Department of Conservation and Natural Resources operations, said Jeffrey Sheridan, spokesman for the governor's office.
Those actions, as well as declining revenue from lease royalty payments from oil and gas drilling on state lands, have left the fund without enough revenue to support DCNR from the Oil and Gas Fund, he said.
The state should make spending cuts to balance the budget instead of piling more fees on top of the waste hauling industry, the haulers said.
“I think it's the wrong way for them to do it. I mean, I'm sorry that they guessed wrong and they overspent and they didn't plan right. But why should we have to cover for them,” said Ed Vogel, vice president of Vogel Disposal Service, a waste hauling company based in Butler County's Adams Township that owns Seneca Landfill in Jackson. The company has about 100,000 residential customers, plus commercial and industrial customers, he said.
In Pennsylvania, there are 43 active municipal waste landfills and 4,878 active waste haulers that operate about 40,000 trucks, tractors and trailers, according to the state Department of Environmental Protection.
Waste haulers argue that they already pay an average of $10 per ton in tipping fees, which includes $4.25 to the state's Environmental Stewardship Fund, $2 per ton to the state's Recycling Fund and at least $1 to the host municipality.
In 2015, the state collected a total of $37.8 million for the Recycling Fund and $67.5 million for the Environmental Stewardship Fund, according to DEP.
Vogel's Seneca Landfill paid $2.95 million in state and municipal fees in 2015, Ed Vogel said.
The haulers argue that their customers ultimately will get stuck with the higher bills.
When the state implemented a $3.25 tipping fee in 2004, it led to issues between Vogel and its municipal and commercial customers because the company had to pass the fees on to them, Vogel said. Some customers incorrectly believed that their contracts prohibited that, he said.
The state does not have an estimate on how the tipping fee increase might affect trash haulers' customers, Sheridan said.
“But Pennsylvania needs a balanced budget, and we need to fix the multi-billion-dollar deficit the governor inherited. In order to do this, we need new, recurring revenue because you cannot cut your way out of a deficit of more than $2 billion,” he said.
Higher landfill costs incentivize more waste diversion from landfills, such as with recycling and composting, said Justin Stockdale, western regional director of the South Side office of Pennsylvania Resources Council, a nonprofit environmental organization.
When the $4 per-ton tipping tax was enacted in 2004, waste volumes decreased by 5.7 million tons, which resulted in a deficit of more than $20 million in annual state revenues projected from the new tax, the waste haulers association said.