Fiscal Note
The proposed resolution approves a revised 2026 Resource Recovery Special Charge rate of $5.40 per month (increasing from the current rate of $3.50 per month), beginning September 1, 2026, and continuing through the remainder of 2026. The additional cost per residential dwelling unit is $7.60 for 2026. The rate adjustment is needed to cover an anticipated funding shortfall of $545,000. This shortfall is caused by the lower values of recyclable materials resulting in lost revenue, increased diesel fuel costs, and personnel costs above the agency's salary savings target. The proposed resolution also authorizes the 2026 Streets Division Operating Budget to be amended, for both revenues and expenses, in the amount of the anticipated shortfall.
Title
Approving a Revised Rate for the 2026 Resource Recovery Special Charge and Amending the 2026 Streets Division Operating Budget
Body
PREAMBLE
On April 19, 2022, Section 4.097 of the Madison General Ordinance was created to establish a Resource Recovery Special Charge (File No. 70344). The ordinance created the Resource Recovery Special Charge in the City based upon the authority granted to the City by Wis. Stat 66.0627, pursuant to Sec. 4.09(13) MGO. This special charge allows the City to recover some of the costs of the Street Division to provide curbside recycling services to certain properties in the City. The special charge will only recover the cost for services actually performed by the City, and the amount imposed may be adjusted throughout the year to account for greater or lesser expenditures. The special charges approved by this resolution are being apportioned consistent with the Resource Recovery Special Charge Policy (Legislative File ID No. 71186).
WHEREAS, on April 19, 2022, the Common Council adopted Ordinance ORD-22-00029, File 70344, creating Section 4.097 of the Madison General Ordinances, which ordinance established the Resource Recovery Special Charge in the City of Madison; and,
WHEREAS, the Resource Recovery Special Charge is administered pursuant to the Recourse Recovery Special Charge Policy (Legislative File ID No. 71186); and,
WHEREAS, the intent of the Resource Recovery Special Charge (RRSC) is to recover the costs to the City for recycling services as part of its recycling program that provides service to mostly residential, and some commercial properties in the City; and,
WHEREAS, the RRSC rate for 2026 had been set at $3.50 per month per dwelling unit for residential properties, and $3.50 per month per dwelling unit equivalent for commercial properties receiving recycling collection; and,
WHEREAS, the annual RRSC cost per dwelling unit and dwelling unit equivalent is $42.00; and,
WHEREAS, the 2026 RRSC rate was determined in 2025 by calculating anticipated costs for Streets Division operations and realizing revenue generated from recyclable materials; and,
WHEREAS, lower values of recyclable materials resulting in lost revenue, increased diesel fuel costs, and an inability to reach anticipated salary savings have changed the expected expenditures for the recycling program for the remainder of 2026; and,
WHEREAS, the previously established RRSC rate for 2026 for residential and commercial service users will not generate adequate funding to pay for recycling services expenditures; and,
WHEREAS, the anticipated shortfall in funding would be $545,000; and,
WHEREAS, in order to prevent the shortfall, the RRSC rate needs to be amended; and,
WHEREAS, each unit residential and commercial unit receiving recycling collecting from the City of Madison Streets Division, and therefore paying the monthly RRSC, will see a rate increase starting on September 1, 2026 and continuing through the remainder of 2026; and,
WHEREAS, the new RRSC rate for each residential dwelling unit will be $5.40 per month (increasing from the current rate of $3.50 per month), and the new rate for dwelling unit equivalents of commercial properties receiving recycling collection will also be $5.40 per month (also increasing from $3.50 per month); and,
WHEREAS, the new annual cost for 2026 per dwelling unit and dwelling unit equivalent following the rate increase will be $49.60 (increasing from $42.00); and,
WHEREAS, the rate adjustment is expected to generate $545,000, which will sufficiently address the anticipated shortfall; and,
WHEREAS, the 2026 Streets Division operating budget will be amended to reflect the corresponding increases in revenues and expenditures; and,
NOW, THEREFORE, BE IT RESOLVED:
1. That the 2026 Resource Recovery Special Charge annual cost shall be amended to $49.60 per dwelling unit (or its equivalent) with a new per month rate of $5.40 per dwelling unit equivalent starting on September 1, 2026, which rate is adopted in accordance with Section 4.097 of the Madison General Ordinances, the Resource Recovery Special Charge Policy, and the 2026 Adopted Operating Budget; and,
2. That this approved monthly Resource Recovery Special Charge rate shall continue until a new schedule is approved by the Common Council; and,
3. That the Streets Division amends the adopted operating budget for 2026 to increase revenues by $545,000 in charges for services and expenses for the following: $250,000 for purchased services, $170,000 for salaries, and $125,000 for lost revenue.