Historically, local governments have been responsible to manage waste generated by their residents. In recent decades, some residential waste has been managed by diverting it from disposal to recycling and composting. As part of this effort, local governments have implemented curbside collection systems for packaging and printed paper (PPP) and organic wastes and drop-off depots for these and other materials where recycling options were available. These diversion initiatives, and plans to expand these programs to increase diversion, are set out in solid waste management plans against which regional districts are held accountable by the provincial government and their residents.
By 2011, local government recycling programs for PPP diverted an estimated 50% to 57% of the PPP available for collection. While this represents significant progress, there is clearly still much to be done to better manage the resources that are used to manufacture packaging and printed paper products. This is one of the objectives of the PPP Stewardship Plan and the shift of responsibility from local governments to stewards.
Some local governments have expressed concern that they are at risk in this transition to producer responsibility. For example, regional districts have raised concerns that they will not be able to deliver on their solid waste management plan objectives if the PPP Stewardship Plan does not achieve its performance objectives.
The PPP Stewardship Plan is based on a program design approach that allows local governments to continue to provide PPP collection service. In this role, local governments will be positioned to mitigate risk associated with collection system performance. The PPP Stewardship Plan also proposes to improve performance by expanding curbside service levels and the range of PPP collected which should contribute to higher PPP capture rates.
While MMBC will assume responsibility for PPP consolidation, transfer, freight and processing services under the PPP Stewardship Plan, thereby removing these costs from local governments, some local governments have expressed concern that the market-clearing prices to be offered for collection services may be lower than local government collection costs.
The payment of market-clearing price financial incentives will be a new source of income for local governments that is intended to offset revenue from property taxes or utility fees used to deliver PPP collection services.
The market-clearing price represents an assessment of the typical cost to deliver an efficient collection service. An effective market-clearing price should reward and encourage continued efficiency by those who can deliver the service at less than the market-clearing price while encouraging initiatives to reduce costs where costs exceed the market-clearing price.
Should the market-clearing price offered be less than a local government’s current costs, local governments should consider whether the collection service it currently provides includes special services beyond the collection service for which MMBC is offering the market-clearing price. The local government can also explore options to reduce collection costs to be equal to or lower than the market-clearing price.
Additionally, the market-clearing price approach allows local governments to continue to integrate recycling and waste collection services, provide resident education and act as the first point of contact for residents, all services that are reportedly important to local governments.