Trashing the Rebates – Why Smaller Black Garbage Bins Will Cost More

Trashing the Rebates – Why Smaller Black Garbage Bins Will Cost More

Several years back, the City of Toronto moved away from paying for water and garbage disposal through property tax rates. A new funding model was introduced to fund those services separately through a utility bill.

In Willowdale, where residents pay higher than the city average in property tax rates, homeowners were previously paying much more than residents in other parts of the city for the same services. By breaking out the costs onto a separate bill, all residents would not only pay a uniform rate but also control their costs with the ability to use those services less. This was generally seen as a positive step.

Charging a fee for garbage disposal through the City’s Black Bin program, while offering blue bin and green bin services for free, also incentivized diverting any waste that could be recycled or composted to the appropriate location.

To make this system more appealing, a rebate system was introduced by Council. The City would charge an annual fee for the bin, then offer a rebate in an often comparable amount.  In 2018, this meant the small bin fee (and true cost) was $254.66. With a $227 rebate, the amount owning was only $27.65.

However, the rebate system made utility bills complicated to the point of being incomprehensible for many residents. It also created a system where homes using large bins were covering costs for others. For reasons of both fairness and transparency, it was time for the rebates to go.

In 2018, Council voted to complete the phase-out rebate system between 2019 and 2021. It approved an inflationary increase of 2% on the fee for each sized bin. Though that fee increase was only $5 for the small bin, the amount owed jumped by $72 (or 261%) because of the reduction of the rebate.

Users trying to do the right thing by using a smaller bin were understandably upset. The speed of the phase-out had presented unintended consequences for the customers the City most wanted to incentivize.

Over the summer, John met with the General Manager of Solid Waste presenting these concerns and asking for a strategy that would soften the impact of the rebate reduction. When the matter came back to Council however, little had changed and attempts to alter the rebate structure on the floor were ruled out of order by the Speaker.

Based on this, John voted against how the matter was being handled, being only one of three councillors to do so.

John does believe that it makes sense to eliminate the rebate system so that a user fee is fairly applied to all homeowners. He also believes that there needs to continue to be strong financial incentives to create less garbage and that larger bin owners should be paying substantially more for their bins. This is where things will end up by 2021, but the City could have handled the process much more smoothly.

If there is a silver lining, once the rebate is finally phased out, all bin prices should stabilize for the foreseeable future.

Image: Michalis Famelis | Flickr

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