Who pays for municipal waste management in Ontario?

20150414104823439Time for another blog based on a common question I receive from residents: how does a city fund its waste management programs? There is also a related question of does recycling pay for itself? The short answers are a bunch of different ways and no. Before I delve any further, I will put out a disclaimer that what I will be discussing from here on is based on my own personal knowledge, which does not necessarily apply to every single municipality in Canada, or even Ontario. Feel free to point out any inconsistencies in the comments section.
To the first question, waste programs such as garbage, recycling and organics collection, drop off depots, promotion campaigns, etc. are usually funded through three sources, in no particular order:
Municipal property tax revenue
The sale of recyclable material
Stewardship groups.
The first two are pretty self-explanatory, as all municipalities place a tax on properties to help cover municipal programs, including waste management, and most recyclable items generate some source of revenue. It is the third point, stewardship groups, that is more complex.
A stewardship group is basically an organization set up by the companies that produce or import products that have packaging that eventually becomes waste – think companies like Coca-Cola, Procter & Gamble, Wal-Mart, etc. Many governments have rules in place that state companies that sell or create products that become waste, like plastic bottles or cardboard boxes, have to help offset the cost of the collection and disposal of said products. Offsetting the cost often comes through monetary payments (but not always) to the level of government that handles waste. The amount of money a given level of government receives is usually tied to the amount of waste they collect and/or process. The basic premise is that since the company is producing the waste they should help pay for its disposal.
Stewardship groups can have many different arrangements, and this general concept is called producer responsibility. There are different types of producer responsibility, with terms like extended producer responsibility and individual producer responsibility bandied about. These are all topics for a separate blog however.
To tie in the second question, the sale of recyclable material typically does not cover the cost of a recycling program. Certain recyclables definitely generate net revenue when you take into account operating costs (aluminum, some plastics, paper if volume is high enough), but some recyclables do not generate net revenue (some plastics, Styrofoam and glass). Non-revenue generating recyclables are usually tough to process and/or cannot easily be used to make new products, thus lowering their value. As a result, the first and third funding sources (municipal tax revenue and stewardship groups) are required.
As I often tell people, no one who wants to get rich will get involved in municipal recycling. That being said, while revenue generation from recycling is an important aspect of the business, the main purpose of recycling is environmental. Benefits such as conservation of energy, land and resources are the reason recycling exists.
Hopefully this very brief explanation makes the funding of municipal waste management a bit more clear to the non-insider. Next week I will tackle the controversial world of producer responsibility!

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