City trash rates explained; commercial customers likely to see future increase

The City of Guthrie’s solid waste (trash) service rate compared to the disposal cost was the topic at hand during a workshop on Tuesday evening. Turns out, residential customers generate a higher percentage of revenue for the City than commercial accounts do. For now, anyway.

Guthrie City Manager Leroy Alsup provided an extensive look into the City’s billing and cost from Waste Connections, who provides garbage service for the City.

Alsup explained in 2021 Waste Connections billed the City $466,847.52 for the nearly 5,000 residential accounts (3,593 customers within city limits). In return, the City billed out $747,612.72 for a revenue margin of $280,765.20, or 38%.

Meanwhile, the City made 21% ($130,237.68) in revenue from commercial customers in the same time period.

“It would seem to me that the commercial margin should be bigger than the residential margin,” Mayor Steve Gentling said. “I think that is egregious.”

Alsup informed council members that Walmart, Loves Travel Stop and AutoQuip are only being billed for the cost by Waste Connections with no mark up from the City as is the case for other commercial and residential customers.

Alsup said it was unknown why that arrangement was made with the three businesses.

“Personally, as a person living in the City of Guthrie, I would be upset to know that Walmart gets zero rate increase and you’re charging me 38%. I don’t think so.” said Councilman James Long who also operates a business in town.

The City has not passed along a rate increase to customers since 2006 when it was increased by 12% to $13.24 monthly. However, since 2012, Waste Connections has increased their monthly billing to the City by10.6% (from $7.60 to the current $8.24).

With all accounts combined, the City generated $400,641.03, or 28%, in revenue in 2021.

On social media, some citizens shared their concerns on why the City should even generate any revenue from the service. “In the construction field we do not get a third mark up. Why should the City of Guthrie make one,” said one viewer.

Council member Don Channel replied to the comment, in part, “The city has very few avenues to generate income. There is sales tax, water and garbage service along with permits and tickets. Nothing else to generate income. If you think everything should be ran as 0 (zero) profit, I’m good with that as soon as you tell us how to pay for all of these other things that cost you nothing and are done automatically.”

The City’s revenue also helps toward billing, overhead costs and in part subsidizes the convenience center (city dump).

Alsup showed a comparison of other towns when it comes to in town garbage rates with Crescent ($13.24), Guthrie (13.24), Luther ($15.30), Kingfisher ($16.05), Choctaw ($19.00), Stillwater ($20.38) and Cashion ($21.21).

Alsup found in two instances where Waste Connections was charging more for services than the City was passing on to the customers (additional polycart for customers outside of city limits and commercial accounts with two pick-ups a week for three yards).

With the guidance from the council, Alsup will bring modifications to the council for an increase to commercial accounts. Residential accounts may only be affected if costs from Waste Connections are increased, which is expected to happen at 2%.

With a proposed rate increase to commercial accounts, the City could see an increase in revenue by an estimated $150,000 each year.

The council is expected to discuss and take action in January.

Inside the Numbers

For residential customers within the city limits, Waste Connections charges the City $8.35 per month and in return the City charges customers $13.24.

The City’s percent margin is currently at 26% for customers per year, which has been decreasing over the years with cost increases from Waste Connections. The City’s revenue portion was at 37% in 2011.


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