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Under the solid waste contracts begun in 2006, Omaha provides solid waste collection services to the residents of Omaha at a cost of $8.74 (cost in 2006) per household per month. The general fund, made up of property and sales tax, is the source of funds used to pay for this service. The total solid waste services annual budget is $14 million and includes all of these services:
- Residential garbage, recycling and yardwaste collection
- Recycling drop-off sites
- Neighborhood spring clean-up
- Christmas tree drop-off sites
- Bulky material drop-off site subsidy
- Litter cans and pedestrian recycling cans in business districts
Because the City holds a contract on behalf of all residents of Omaha, the City is able to obtain this service at substantially lower costs than that of the surrounding communities. The contract begun on January 1, 2006 will continue for 10 years, and has an option to extend the contract for an additional 5 years. Garbage, recycling and yardwaste collection consume 78% of the solid waste service budget.
Nebraska State law (NRS 13-2020) requires that the City of Omaha provide garbage collection to all single-family households without directly charging the household. Because of this, many citizens believe that garbage collection is "free" which is not the case. The cost of providing garbage collection is paid from the City's general revenue fund, which is derived from property and sales taxes.
A new collection contract with Deffenbaugh Industries began January 1, 2006. Prices given here are from 2006. Under the terms of the contract with Deffenbaugh, the fees are adjusted annually for inflation based on the Kansas City Consumer Price Index. The Douglas County Landfill adjusts its fee annually, and the Douglas County Board sets the amount. Deffenbaugh's contract was also amended in July, 2012, allowing for an adjustment in fuel price based on consumption.
Under the terms of this new contract, the City pays $5.14 per household, per month for garbage and recycling collection, and $2.85 per household per month for 9 months per year for yardwaste collection. In addition, the City pays the disposal fee at the Douglas County Landfill ($21.79 per ton) and the yardwaste composting facility ($19.52 per ton up to 26,500 tons and $10.74 for all additional tons).
These contracts will be in place for 10 years with an option to extend the contract by 5 years making the potential ending of the contract December 31, 2020.
On January 1, 2006, the City also began a new contract for processing recyclables. The new recycling contractor is Firstar Fiber, who will be using a semi-automated system of sorting recyclables. The City does not pay a per ton fee for recyclables processing, but instead receives revenue of $ 39.293 per ton of recyclables. Additionally, because recyclable material would otherwise go to the landfill, the City avoids paying the landfill's disposal fee of $21.79 per ton.
Similar to the solid waste collection contract, the revenue rate for recyclables is adjusted, however it is adjusted monthly and is based on the recycling industries published standard, The Official Board Markets. The rate shown, and used to project the entire year is the rate for January 2006. The Firstar contract was also amended to remove the compensation for glass collected at drop-off sites.
Under the terms of the contract, the projected3 cost per Omaha Household for 2006 are: Garbage & Recyclable Collection $ 61.68 Yardwaste Collection $ 25.65 Garbage Disposal3 $ 17.68 Yardwaste Processing3 $ 5.08 Recycling Revenue3 ($ 5.16) Recycling Avoided Expense compared to Landfilling3 ($ 2.86) Projected Total Annual Cost Per Omaha Household for Solid Waste Collection in 2006 $ 102.06
For comparison, the previous solid waste contract had the following costs:
Under the 1996 through 2005 contracts with Deffenbaugh Industries, the City paid in 2002, $5.301 per household per month for garbage and recycling collection and $2.69 per household per month for 9 months per year for yardwaste collection. In addition, the City pays the disposal fee at the Douglas County Landfill ($22.06 per ton in 2002) and the yardwaste composting facility ($18.89 per ton up to 26,500 tons and $10.39 for all additional tons in 2002).
In the 1996 through 2005 contract the City did not pay a per ton fee for recyclables processing to the recycling processor, Weyerhaeuser Recycling. Instead, the City shared in the revenue from the actual sale of recyclable material. Additionally, because recyclable material would otherwise go to the landfill, the City avoids paying the landfill's disposal fee of $22.06 per ton.
Under the terms of the contract with Deffenbaugh, the fees were adjusted annually for inflation based on the Kansas City Consumer Price Index. The Douglas County Landfill adjusts its fee annually, and the Douglas County Board sets the amount.
In 2002 the Annual Cost per Omaha Household were: Garbage & Recyclable Collection $ 63.60 Yardwaste Collection $ 24.21 Garbage Disposal2 $ 17.60 Yardwaste Processing2 $ 4.63 Recycling Revenue2 ($ 3.71) Recycling Avoided Expense compared to Landfilling ($ 3.24) Total Annual Cost Per Omaha Household for Solid Waste Collection in 2002 $ 103.09
1 All dollar and tonnage amounts are based on the numbers at the end of 2002. Recycling Revenue was computed using an average of revenue from 1996 through 2002. In 2002, there were 96,909 tons of garbage, 32,462 tons of yardwaste and 17,816 tons of recyclables.
2 The total cost, revenue generated or avoided cost has been averaged across all households which was 121,428 in 2002 and 125,000 in 2006.
3 The tonnage amounts generated in 2004 have been used to project the costs and revenue for 2006. In 2004, there were 101,398 tons of garbage, 37,451 tons of yardwaste and 16,420 tons of recyclables.