IMPLEMENTATION OF WEIGHT-BASED BILLING IN MUNICIPAL REFUSE COLLECTION. Jim Pickett Market Manager-Municipal Automated Systems Toter Incorporated

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1 IMPLEMENTATION OF WEIGHT-BASED BILLING IN MUNICIPAL REFUSE COLLECTION Jim Pickett Market Manager-Municipal Automated Systems Toter Incorporated "Rate Equity" and "Unit Pricing" are two of the most common buzzwords in today's municipal solid waste collection circles. Flat collection rates are out. Volume-based billing is in and has been growing in popularity over the past five years. Cities are trying variable can rates, bags, and sticker programs. The push for Unit Pricing is fueled by the obvious inequities of flat rates and the need to create stronger incentives for waste reduction and recycling. Volume-based programs are partial solutions at best. Homeowners can easily cheat by using kitchen compactors. Manual collection of bags and cans ignores the risks of higher workers' compensation claims and increased turnover and absenteeism. Weight-based billing, or "Garbage By The Pound," has been field tested since Tight federal weights and measures accuracy standards govern weight-based commercial trade, including the collection of garbage, recyclables, and yardwaste by the pound. Two scale systems built into semi-automated cart dumpers have recently been certified by federal officials, clearing the way for weight-based billing "Garbage By The Pound" is billed as the ultimate incentive for waste reduction and recycling. Homeowners can see an immediate reduction in their bills as they divert pounds from the garbage stream. Cheating is much more difficult when weight is the method of measurement. Cities are considering how to successfully implement weight-based billing. The step from a great concept to a practical system acceptable to the public is a challenge. Like other changes in the delivery of public services, a common sense approach is needed to design and implement a program that will gain public acceptance and achieve the desired results. Public education and preparation for the implementation is the critical first step. Two commonly held misconceptions are that the city is getting too nosy about peoples' trash and that everyone's rates will go up dramatically. These fears need to be allayed upfront before dealing with more practical collection issues. Citizens are surprised that their rollout carts, which are key to weight-based billing, will be electronically scanned at pick-up to identify whose garbage is being weighed. This ID technology, which is radio frequency identification or RFID, is commonly perceived to be too futuristic and very expensive. In fact, the cost of the RFID transponder is only about $0.75 per year over the ten year life of the cart. RFlD technology is well proven in animal identification, automatic toll roads, inventory control, and other applications not suited to bar coding. For some reason a few people associate scanning for weight-based billing with "Big Brother." Public education must make it clear that no one is looking at the garbage, it's only being weighed. Weight-based rates can be controversial from the outset. Opponents of this change in service decry it as a smoke screen for raising everyone's rates. The fact that no one is used to weight-based charges can make newly established rates suspicious. 109

2 In reality, weight-based collection equipment that is highly productive adds little to the cost of garbage pick up. The incremental cost per household for once-a-week service should be about $3.00 Per year including RFID transponders and all truck hardware. Even a modest increase in recycling Or wase reduction will yield landfill disposal savings that more than offset this cost increase. The task of actually setting rates will be discussed later. Once the public has been educated and prepared, actual implementation can begin. Metered service at every household necessitates a thorough review of the city's utility data base. All customer accounts must be identified by the corresponding cart RFlD number. The customer files may have to be modified to include this cart information. The RFlD number is the key to accessing accounts. Residents cannot "read" their RFID numbers and therefore must rely on the visual serial number of their carts to avoid cart mix-ups. The proper scale system must then be chosen. The combination dumper and scale must be compatible with ANSI standards and It must operate with acceptable speed and with a realistic level of operator training. Of course, the system must meet federal and state weights and measures regulations as set forth in the National Conference on Weights and Measures Handbook 44 in order to be "legal for trade." An N.T.E.P. Class 111 certification is required, which means the scale is accurate within one pound at any weight. The scale must also include sufficient angle compensation to weigh accurately on the city's hills. Regulations require special compensation on hills of more than 3'. Collection crews and drivers must be trained to operate the dumper/scale system. Crew members must dump the carts in a smooth, complete cycle and keep their hands off the carts during dumping. Hands on the cart during weighing will lead to an incorrect weight. Any overage must be loaded into the car! for weighing, which can result in two or more weight records for a resident in a given pick up. Hand loading into the truck is equivalent to free service. A system for charging for large items that cannot be loaded into a cart must be developed and implemented. Drivers must be alert to any obvious irregularities in the cart ID or weight being displayed in the cab as well as audible alarms that indicate a fault. The city may choose to train drivers to quickly troubleshoot systems on the route using the simple menu driven, diagnostic software. The city's office staff must be prepared to download daily route data from the vehicles' on-board computers into files in the office PC. The city's MIS staff or outside programmers must complete the data interface from these route files to the customer data base. Correct data transfer is critical to the success of a garbage by the pound program. Billing data must be posted to customers' accounts and the information included on the utility statement. Rates should be set to ensure the success of the program. First priority is collecting sufficient revenue to cover costs as required by the city government. A basic service fee for driving by the residence and offering collection service provides a defined amount of revenue. Setting the per pound rate can be as simple as dividing the estimated revenue requirement by the estimated weight to be collected throughout the residential system. Stronger incentives can be established by implementing rates that reward reductions in weights set out. Rates can be set with ranges that increase the per pound charge as the weight exceeds certain target levels. At the heart of any weight-based billing system is the scale hardware and software. Like any scale, vehicle mounted systems are subject to downtime. Vehicle downtime for mechanical problems is much more common than scale downtime but has the same result - garbage is not being collected and weighed- The city should plan for downtime when ordering equipment to ensure a spare vehicle is available. Available service and response time should be considered when selecting a scale. Like many innovative technologies in the public works sector, weight-based billing may be accepted Only after a successful test or pilot program. The test group needs to be educated about the concept and 1 10

3 how the test will be administered. Actual weight-based billing of the participants is desirable but difficult to implement when the majority of the city is still on current flat rates. As the recent pilot program in Columbia, South Carolina illustrated, issuing dummy invoices with each pick up documented and billed gives participants enough data on which to form an opinion about the service. The weight data gathered during the test can quickly be tied to demographics to evaluate the validity of the rate structure. The Columbia pilot program was unique in its length and degree of integration. A Heil 5000 rear loader was equipped with a Toter Smartway@ II Automatic Weighing System with two cart dumpers. Residential routes of 800 to 900 homes per day were run 4 days per week. Carts were weighed in-motion to maintain collection productivity. Five hundred (500) volunteers had RFlD tags mounted on their 96 Gallon Toter Carts. Their accounts were set up in a special test data base to avoid any disruption of the ongoing billing for services. One hundred and fifty-six (156) of the volunteers were cataloged demographically as follows: address, salary range, recycling habits, and family size. These 156 residents received itemized dummy invoices which included their recent history and current pick-ups by date, time, and weight. Demographics of the test group are shown on Appendix A (attached). As the test neared completion in April 1995, a telephone survey of participants was conducted. The questions and responses were: (See Appendix B - attached) The pilot program results must be considered in the context of the existing program and fees. The tipping fee in Columbia is $18.50 per ton. The annual tax allocation for services including once-a-week garbage, trash, recycling, and street sweeping is $ or $15.40 per month. Although the Columbia pilot indicated strong support among the volunteers, the city staff has recommended waiting on city-wide implementation. This pilot and future ones, along with the pioneers in city-wide systems, will establish a confidence base that will lead more and more cities to adopt garbage by the pound as the most equitable billing system for residential garbage service. Special thanks to the City of Columbia, Director of Public Services Mark McCain, and Solid Waste Superintendent Robert Anderson for their pioneering efforts toward evaluating Garbage By The Pound ~ 111

4 ' Appendix A City of Columbia, Weight Based Garbage Qllection Social I' Economic Diversity As staked previously the Solid Waste division wanted to ensure that the pilot program represented a cross se&on of Columbia's economically and socially diverse areas. As a result, the division surveyed participants allowing us to track demographics. These statistics are outlined below: 1. Total structure occupancy. Average: Largest: ,..., Smallest:......,,..,,,,.... a. *,.,e..*, 1 2. Number of Children: Average:., Largest: Smallest:,.., Annual Salary Range percentages: $10,000 to $25, % $25,001 to $50, % $50,001 to unlimited % 4. Current recvcline: practices: J -1 Currently participating,, % Currently not participating % 5. Completed High School: Yes *...,.,. *.., % No.., % 112

5 Appendix B City of Columbia, Weight Based Garbage Collection Survey A telephone stwey of the majority of participants was conducted over a two-week period in April Below are the results of this survey. Several participants elected not to answer the survey. I. Do you think this program would be beneficial to the City of Columbia? Yes: % No: % Undecided.:...6% 2. During the testing period, did you begin recycling? Yes: % ATo: % Undecided:... 8% 3. If you were already recycling, did your recycling efforts increase during this period? Yes:....26% No: % Unknown:...18% 4. Were you able to see a significant change in your roll cart refuse? Yes; % No:....65% Unknown;... 11% 5. Would you be receptive to paying a lesser amount for a small amount of garbage with a progressive charge for the more you generate? Yes:....75% No:....,18% Undecided:.. 6% 6- h hat are some of your comments concerning this program? Comments are addressed at the end of the survey. 113

6 J City of Columbia. Weight Based Q 7. Do you support the weight based concept? Yes:.....8Q% No:.....4% Undecided:..16% 8. DO you think weight based collection is an equitable way to provide service? Yes: % ATo:.....7% Undecided:..14% 9. If implemented, would you rather see this billed as a monthly service like your watm bill or separately? Water Bill:...31% Separate:....58% Undecided:.. 11% 10. Would you rather pay for waste generation by the pound or have the cost included in you taxes? Pound: % Taxes:.....7% Undecided:.. I1 % Comments given during the survey were few, but most concerned the impact of the program on property taxes. Comments included the attractiveness of the program only if the property taxes would be reduced. Another area of concern among those surveyed WS the potential or open dumping, and the fear that this kvould cause Columbia to look unsightly. 114