Form revised January 17, 2003

Fiscal Note

Each piece of legislation that appropriates funds, creates position authority, or will create a financial impact through policy direction or otherwise, requires a fiscal note. The fiscal note should be drafted by department staff and should include all relevant financial information. After preparation by departmental staff, the Department of Finance will review and make necessary revisions before transmittal to Council.

Department:	Contact Person/Phone:	DOF Analyst/Phone:
Seattle Public Utilities	Chris Luboff 4-7644 Gabriella Uhlar-Heffner 6-9772	Susan Cole 4-8894 Thomas Dunlap 6-9120

Legislation Title:

AN ORDINANCE relating to Seattle Public Utilities; prohibiting certain recyclable materials from disposal in commercial, residential and self-haul garbage; establishing enforcement provisions; and amending the Seattle Municipal Code by creating two new sections in Chapter 21.36.and by amending section 21.36.922.

Summary of the Legislation:

This Ordinance would prohibit garbage disposal of selected recyclable materials. Disposal of yard waste and paper products would be prohibited in the commercial sector, and disposal of paper products and containers (bottles and cans) would be prohibited in the residential sector. These bans are one element of the Mayor’s 60% recycling proposal submitted to the City Council in January 2003. The bans would go into effect January 1, 2005.

The Ordinance also establishes penalty provisions, and delegates the details of monitoring and enforcement activities to Administrative Rulemaking.

Appropriations (in $1,000’s):

Fund Name and Number	Department	Budget Control Level*	2003 Appropriation	2004 Anticipated Appropriation
Solid Waste Fund 45010	SPU		0	0
TOTAL

* This is line of business for operating budgets, and program or project for capital improvements

Notes:

Expenditures (in $1,000’s):

Fund Name and Number	Department	Budget Control Level*	2003 Expenditures	2004 Anticipated Expenditures
Solid Waste Fund 45010	SPU		0	748
TOTAL				748

* This is line of business for operating budgets, and program or project for capital improvements

Notes: These costs cover costs of education about the upcoming ban, plus costs for collecting additional tons of residential recycling.

These costs are offset by a projected $530,000 in disposal cost savings from recyclables diverted from the landfill. The net cost in 2004 is projected to be $218,000. This amount is included in the Department’s 2004 budget submittal.

The City has proposed a companion program to support the commercial paper ban: City-provided curbside recycling available for all businesses. This program is projected to cost an additional $54,000 in 2004 for promotion and account set up. This amount is also included in the Department’s 2004 budget submittal.

Anticipated Revenue/Reimbursement (in $1,000’s):

Fund Name and Number	Department	Revenue Source	2003 Revenue	2004 Revenue
Solid Waste Fund 45010	SPU		0	0
TOTAL

Notes:

Total Permanent Positions Created Or Abrogated Through Legislation, Including FTE Impact; Estimated FTE Impact for Temporary Positions:

Fund Name and Number	Department	Position Title*	2003 FTE	2004 FTE
Solid Waste Fund 45010	SPU
TOTAL

* List each position separately

Do positions sunset in the future? (If yes, identify sunset date):

The bans will require on-going dedicated staff for enforcement in 2005 and beyond. It will also require additional customer service support during the start up phase (2005-2007). The exact level and duration of staff support necessary cannot be finally determined until the program is underway, nor can we currently say whether the Department will be able to reallocate existing FTEs to these tasks.

Background (Include brief description which states the purpose and context of legislation and include record of previous legislation and funding history, if applicable):

The City established a goal of recycling 60% in its adopted Comprehensive Solid Waste Management Plans in 1998 and 1998. The 1998 Plan was adopted by Resolution 29805.

In 1995 the City was on its way to achieving this goal with a 44% overall recycling rate. Since then, however, the overall recycling rate has declined to 38% (2001) – primarily due to a decline in commercial sector recycling. At the same time, about a third of the waste going to the landfill is recyclable paper.

In January 2003, the Mayor submitted a proposal to the City Council identifying a list of programs which were projected to achieve 60% waste reduction and recycling. The document was entitled “Sustaining our Commitment: Mayor Nickels’ Plan to Reaffirm Seattle’s Leadership in Recycling”. The commercial paper and yard waste disposal bans and residential recyclables disposal ban were three of the 10 programs proposed.

The City Council requested that an Ordinance designed to implement the disposal bans be presented to them in July 2003. This fiscal note supports such an Ordinance.

The financial cost of not implementing the legislation (Estimate the costs to the City of not implementing the legislation, including estimated costs to maintain or expand an existing facility or the cost avoidance due to replacement of an existing facility, potential conflicts with regulatory requirements, or other potential costs if the legislation is not implemented):

For materials that are currently recycled (including all the materials proposed in these bans) diversion from garbage collection and landfilling to recycling collection and processing results in a net savings over time. These cost savings are reflected in savings in our collection and disposal contracts.

In 2004 savings of approximately $530,000 are projected from increased residential recycling and commercial yard waste diversion. As mentioned above, the net costs in 2004 are projected to be $218,000. As the programs ramp up, additional avoided disposal cost savings are projected. By 2007 a net savings of over $2 million is projected.

There are no regulatory issues related to the Ordinance.

Possible alternatives to the legislation which could achieve the same or similar objectives (Include any potential alternatives to the proposed legislation, including using an existing facility to fulfill the uses envisioned by the proposed project, adding components to or subtracting components from the total proposed project, contracting with an outside organization to provide the services the proposed project would fill, or other alternatives):

Disposal bans are by far the cheapest way of diverting significant amounts of waste to recycling. Voluntary recycling – combined with educational outreach and technical assistance - have been in place since 1989 and still significant quantities of readily recyclable materials are going in the garbage.

Some increased recycling could be achieved by a significantly increased education and technical assistance program, but these costs would be more than the bans, and the results less.

Is the legislation subject to public hearing requirements (If yes, what public hearings have been held to date):

No.

Other Issues (including long-term implications of the legislation):

The long term implications of the legislation are an on-going increase in recycling, which results in long-term cost savings to the City and businesses, as well as environmental benefits such as energy and water savings, reduction in greenhouse gas emissions, and raw material conservation.

FOR CAPITAL PROJECTS ONLY

Background (Include brief description that states the purpose and context of legislation, the expected useful life, anticipated customers/users, assumed level of LEED or other sustainable design elements. Also include record of previous legislation and funding history, if applicable):

N/A

Project Name:

Project Location:

Start Date:

End Date:

Spending Plan and Future Appropriations for Capital Projects (Estimate cost of legislation over time; list timing of anticipated appropriation authority requests and expected spending plan. Please identify your cost estimate methodology including inflation assumptions and key assumptions related to the timing of appropriation requests and expected expenditures. In addition, include the projected costs of meeting the LEED Silver standard in all facilities and buildings with over 5,000 gross square feet of occupied space. Also, be sure to include percent for art and percent for design as appropriate):

Spending Plan and Budget	2003	2004	2005	2006	2007	2008	Total
Spending Plan
Current Year Appropriation
Future Appropriations

Key Assumptions:

Funding source (Identify funding sources including revenue generated from the project and the expected level of funding from each source):

Funding Source	2003	2004	2005	2006	2007	2008	Total
TOTAL

Bond Financing Required (If the project or program requires financing, please list type of financing, amount, interest rate, term and annual debt service or payment amount. Please include issuance costs of 3% in listed amount):

Type	Amount	Assumed Interest Rate	Term	Timing	Expected Annual Debt Service/Payment
TOTAL

Uses and Sources for Operation and Maintenance Costs for the Project (Estimate cost of one-time startup, operating and maintaining the project over a six year period and identify each fund source available. Estimate the annual savings of implementing the LEED Silver standard. Identify key assumptions such as staffing required, assumed utility usage and rates and other potential drivers of the facility’s cost):

O&M	2003	2004	2005	2006	2007	2008	Total
Uses
Start Up
On-going
Sources (itemize)

Key Assumptions:

Periodic Major Maintenance costs for the project (Estimate capital cost of performing periodic maintenance over life of facility. Please identify major work items, frequency):

Major Maintenance Item	Frequency	Cost	Likely Funding Source
TOTAL

Funding sources for replacement of project (Identify possible and/or recommended method of financing the project replacement costs):