By Tony Wittkowski | Local Government Reporter | The Times Herald
Port Huron’s trash tax isn’t raising enough money to pay for the service.
Officials are looking for ways to make costs match revenues.
For nearly a decade, the revenue from the 3 mill trash tax hasn’t covered the costs of picking up trash and recyclables. City Manager James Freed said the difference has been made up with the savings that accumulated while higher property values generated more tax revenues.
But those savings will dry up this year. In 2006-07, the fund balance had $1.3 million in it.
“The city charges 3 mills in order to generate revenue for the garbage and rubbish fund,” city engineer Bob Clegg said. “The problem is revenue, not expenses. We’re still in the process of looking at alternatives, but we are not ready to roll anything out yet.”
The trash tax brought in $1.6 million in the 2013-14 fiscal year. The trash collection contract cost $1.7 million.
In the 2008-09 fiscal year, the tax generated $2.1 million, and the cost was $2.2 million.
The tax costs the owner of a $100,000 home about $150 a year.
In 2013, the city cut costs by rebidding trash, recyclable and leaf pickup. The deal with Marcotte Disposal saves the city about $200,000 a year over the former contract with Waste Management.
“Expenses have gone down because of rebidding the contract, but it has not gone down as much as revenue has,” Clegg said. “We had a fund balance that was significant, but it is dissolving because of this.”
Freed said the city administration has ideas for addressing the problem, but wouldn’t go into detail until they have been discussed with City Council.
“The current model of how we deliver these services is broken and unsustainable,” Freed said. “More than $1.3 million from the fund balance has been used to mask the problem, but that fund balance is gone. The millage may not be the best means of a revenue source. Maybe we need to cut that tax.”
Freed said solutions will be discussed during budget workshops in early May.
Freed said an option might be switching to a fixed fee for garbage collection services.
Port Huron Township uses this model to pay for disposal services with Waste Management.
Carol Maxbauer, a utility billing clerk, said the township charges residents about $40 on a quarterly basis the same way it would for utility fees.
(Author’s Note: This article was originally published on April 9, 2015)