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Home My WebLink About2.B. SKB Development CommitmentkO S E M OUN 1 EXECUTIVE MM A SU RY A CITY COUNCIL E City Council Work Session Date: October 12, 2011 , AGENDA ITEM: SKB Development Commitment AGENDA SECTION: PREPARED BY: Eric Zweber, Senior Planner AGENDA NO. ATTACHMENTS: 2010 Community Solid Waste Fees 'APPROVED BY: ,x RECOMMENDED - ACTION: Provide Feedback on the Solid Waste Fees for the' SKB' Landfill and a Potential Compost Fee. ISSUE SKB Environmental, Inc. has requested an Ordinance text amendment and interim,use permit (IUP) amendment to allow composting of source separated organic material and yard waste at their landfill. The source separated organic material is food and paper waste that would have otherwise 1gone to 'a municipal solid waste (MSW) landfill. The Planning Commission has recommended approval of they amendment with a condition that the City Council consider a modification to the SKB Development Commitment to include a host fee for the composting operation. a DISCUSSION Disposal Fees The City has an agreement with SKB to contribute funds to the City based on the amount of material landfilled. This agreement is the Development Commitment and covers the three7waste streams ,, currently handled by SKB: industrial waste, MSW ash, and demolition,debris. SKB does not landfill MSW itself. Other cities have similar agreements with their landfill operators which are commonly referred to as host agreements. State Statute permits host fees for counties and cities hosting MSW and demolition debris landfills, but the State does not address industrial or MSW ash waste deposits. The State limits the use of the host fees to remediation of environmental impacts caused by landfills, although it appears many host agreements, including the SKB Development Commitment, do not limit how communities can use these fees. Attached to this Executive Summary is a list of the 2010 host fees by a number.of communities with landfills. The host fees are grouped by waste stream. The list of host fees vary significantly by waste stream with MSW landfills receiving the largest contribution per ton and demb1idon debris contributin the least on a per cubic yard basis. Industrial wastes and MSW ash have'fees less than MSW itself. The fees also ' seem to vary by geographic with metropolitan cities and Dakota County charging the most and rural communities and counties charging the least. Wright County °does not charge host fees to the landfill in its County. Many Greater Minnesota counties own and operate their own landfills and therefore do not charge themselves host fees. A major difference between the SKB's Development Commitment and the other host agreements is that the SKB agreement has a fee that is adjustable based on the disposal rate charged to the waste generator. All other host agreements either have a flat fee over the life of their agreement or have an inflationary factor that increases the rate a certain amount each year. The SKB agreement says that they pay a base service charge of $2.75 per ton of industrial waste and $3.25 per ton of MSW ash plus a trust fund amount of $4.00 per ton of either waste, but those rates are pr'o rated based on an - assumed disposal rate of $75 per ton. The actual average waste disposal rate for industrial waste in 2010 was $16.44 a ton and MSW ash in 2010 was $10.75. This results in a. fee of $1.48 per ton for industrial waste and $1.04 per ton for MSW ash. That amount will go up if the waste disposal rates go up, but would also go down if disposal rates went down. Below is provided a table of the capacity remaining at the SKB landfill and what contribution is anticipated for those remaining years. The table is based on the approximate average volume landfilled at SKB during 2009 and 2010 and 2010 waste fees. The annual contribution_ could change if more or less waste is landfilled in a given year or if the amount that SKB charges for waste deposal changes. Based on this information, there is approximately 20 years of capacity left at SKB that would be expected to provide total annual fees of $1,050,000. SKB Landfill Capacit y and Development Commitment Contribution Comport Proposal Discussion of all fees was started with the discussion about levying a fee associated with allowing composting at the site. There have been discussions about modifying the agreement to continue the $25,000 /year payment that was initially made due,to deleting landscaping requirements associated with a previous landfill expansion. That payment is scheduled to end soon. At past meetings there also has been some reservation expressed about introducing composting at the site. Inihe near future, the Council will have two planning applications before them, an ordinance to allow composting in the Waste Management zoning district and amending their existing interim use permit. Should the .Council choose not to approve the composting use; the fee discussion is somewhat mute. RECOMMENDATION If the City Council believes that it is appropriate for source separated organic material composting to be addressed within the Development Commitment, staff has discussed with SKB,an annual contribution of $25,000 to the City. SKB staff has receptive to the idea of the $25,000 annual contribution for every year that they conduct composting at the landfill. 2 Landfill 2 Year Average 2 Year Average Approximate 2010 Approximate Capacity Landfilling Landfilling Years - of Community Yearly Remaining Rate Tonnage Capacity Fee Contribution Demolition 7,217,480 yd 275,000 yd 200,000 tons 26 Years $0.85/ d $233,750 Industrial 11,891,800 yd 625,000 yd 500,000 tons 19 Years $1.48 /ton $740,000 MSW Ash 2,064,191 yd 100,000 yd 75,000 tons 21 Years $1.04 /ton $78,000 Comport Proposal Discussion of all fees was started with the discussion about levying a fee associated with allowing composting at the site. There have been discussions about modifying the agreement to continue the $25,000 /year payment that was initially made due,to deleting landscaping requirements associated with a previous landfill expansion. That payment is scheduled to end soon. At past meetings there also has been some reservation expressed about introducing composting at the site. Inihe near future, the Council will have two planning applications before them, an ordinance to allow composting in the Waste Management zoning district and amending their existing interim use permit. Should the .Council choose not to approve the composting use; the fee discussion is somewhat mute. RECOMMENDATION If the City Council believes that it is appropriate for source separated organic material composting to be addressed within the Development Commitment, staff has discussed with SKB,an annual contribution of $25,000 to the City. SKB staff has receptive to the idea of the $25,000 annual contribution for every year that they conduct composting at the landfill. 2 2010 Community Solid Waste Fees i• Construction and Demolition Debris (C &D) Community Fee (per Cubic Yard) Louisville Township $0.15 Scott County $0.15 Sherburne County $0.30 /Ton Dakota County .$0.40 /Ton IGH & SSP (Dawn Way) $0.65` Rosemount $0.85 Inver Grove leights (SKB) $1.00 Burnsville $1 /Ton + $0:15/yd Industrial Waste Community r fee (per Ton) Sherburne County $0.40 Rosemount $1.48a Dakota County $3.16' Municipal Solid Waste (MSW) Community Fee (per Ton) Burnsville $4.33 Inver'Grove Heights $5.36` Dakota County $8.49 MSW Ash Community Fee (per Ton) Sherburne County $1.00" Rosemount . $1.04d, Becker $2.00e Dakota County $3.58 a '2010 Fee; $0.73 in 2008; $1.29 in 2009 b 2010 Fee; $3.25 in 2011; $3.35 in 2012 `2010 Fee; Increase 3% per Year d 2010 Fee; $0.73 in 2008; $1.05 in 2009 e Based on dry weight (appr..75% of delivered weight) J 2010 Fee; $3.65 in 2011 and 2012 a 1 r a