Inflation forces waste service increases

Representatives from Southern Oregon Sanitation and Republic Services were in attendance at the April 26 Board of Josephine County Commissioners’ weekly business session to explain why the waste collection services need to raise rates for customers.
Trent Carpenter, general manager for SOS, presented first.
“As you know we are the last remaining family-owned garbage company in Southern Oregon,” Carpenter remarked. He pointed out that SOS is celebrating 75 years of business this year and “we’re excited about that.”
SOS has roughly 30,000 customers, according to Carpenter, and the 5.54% rate increase “represents less than a two dollar increase for the average customer.”
Carpenter said that around 80% of residential customers have 35-gallon or 65-gallon waste disposal bins, as opposed to the largest size of 95 gallons.
“Probably one of the biggest things that’s driving the factors, as we talked about last week, is fuel,” asserted Carpenter. “We’ve seen a 109% increase in the last two years just in fuel, and disposal’s gone up 24%.”
Other factors Carpenter listed included recycling cost increases and health care compensation for employees.
Even with the rate increase, Carpenter said, customers in Josephine County will be paying less than those in Jackson County, “and they haven’t even had their rate increase yet in Jackson County.”
“We believe that shows we’re trying to do the best we can to hold the rates down when it’s less than where the landfill is located… We’ll continue to be the least expensive garbage service in Southern Oregon,” concluded Carpenter.
Kent Larson delivered a presentation on behalf of Republic Services, which tread much of the same ground Carpenter’s remarks did.
Larson showed a chart showing usage at the JoCo transfer station dropped from 71,931 users in 2020 to 56,018 in 2022 and an increase in rural Josephine County residential customers from 4,208 in 2020 to 4,547 in 2022.
A rate increase of 5.73% would get Republic back to the 9-12% profit margin allowed by the Consumer Price Index, said Larson, but Board Chair Herman Baertschiger stated the county was only prepared to match SOS’ rate increase of 5.54%.
Disposal at Dry Creek Landfill in Jackson County has gotten 30% more expensive in the last two years, which Larson said is Republic’s largest expense line item.
His slideshow presentation also laid out, “Inflation remains at historically high levels. Proforma results for 2023 with a June price increase of 6.13% result in a margin of 7.3% at year end and a 2022- 2023 two-year average margin of 7.9%. This puts us well below the 9-12% margin allowed by the franchise.”
Larson also expects recycling commodities to be a great expense going forward, with a 20% year over year increase.
Commissioner John West spoke to the importance of balancing the need for waste disposal companies to make suitable profit margins with the need to keep rates affordable for consumers.
“We can’t jeopardize the trash getting dumped in the woods,” West added, calling the 5.54% rate increase a compromise between what the companies would like and what consumers would like. “Hopefully we can keep our places open and keep the services to the people,” West concluded.