Seymour pays $1.5 million a year for sanitation services.
SEYMOUR – A major spike in garbage collection costs forced the Board of Selectmen this week to transfer more than $200,000 from its rainy day fund to make up for the deficit.
The board during its meeting Tuesday (Sept. 6) unanimously approved a transfer of $216,395 from the town’s general fund.
The transfer was needed because the town’s trash contract went up 25 percent. Seymour had budgeted for a five percent increase. The unexpected transfer was needed to cover the gap.
The budget was approved several months before the new trash contract was approved.
The sanitation contract went from $1.2 million a year to $1.5 million.
“The trash increase is due to many factors; we did not have to negotiate our contract for 10 years, so we were paying well below the market rate for several years,” First Selectwoman Annmarie Drugonis said. “Several years ago, many countries stopped accepting single-stream recycling, so instead of being reimbursed for recycling material, we are now paying for them. The initial proposal was a 50 percent increase, and we negotiated it down to about (22 percent).”
Seymour currently has a four-year contract with Oak Ridge, and there are two years left on that contract.
Rory Burke, the town’s chief administrative officer, said staff will be exploring options to see if there’s any way to reduce sanitation costs going forward, including whether it would be feasible to have the town’s own public works department handle the duties.
Burke said there are two components to municipal garbage service, the curbside pickup contract and the disposal portion. The increase is not only attributed to curbside pick-up costs, but for an increase in disposal costs that Burke said is a fixed cost in the town’s long-term contract with Covanta Bristol, a waste disposal facility in Bristol where the garbage ends up.
Burke explained that China changed its policies in 2018 relating to the acceptance of recyclable materials, which he said caused the economics of garbage and recycling to change.
“Recycling used to involve substantial reimbursements that were dramatically reduced, leading to increases in overall costs for municipalities,” Burke said. “This was the first contract negotiated since that change and the town underestimated the scale of the increase.”
Seymour recently had its bond rating downgraded, a result of a weakening economy, the COVID-19 pandemic, and a mistake in predicting health care costs and pension benefits by the school district.
The town’s bond rating is still solid, at AA with a stable outlook. The ratings agency noted the town’s fund balance had been shrinking in previous budget years. At the same time, the COVID-19 pandemic created challenges for municipal budgets that were not seen previously.
The town budget approved by voters in May used about $400,000 from the fund balance to prevent a steeper tax increase. The budget carried a tax increase of just under one mill.
