The Pay as You Throw Solution

April 3, 2018

Our country’s recycling and composting rate has been stagnant for about five years now, holding steady at around 34.6%. Recycling markets “in chaos” continues to be the story of the day. I sympathize with the companies and municipalities hit hard by the current decline in recycling commodity markets. However, I can’t help to wonder why it’s still the national consensus that disposing of trash should be paid for by tax dollars, but recycling has to pay for itself.  

There are some 89,000 local governments in the United States. Yet, according to Skumatz Economic Research Associates (SERA) 2011 survey, less than 9,000 of those communities have adopted Pay as You Throw (PAYT). According to the survey 62 of largest 100 cities in US have adopted PAYT. While certainly the adoption of PAYT continues to slowly rise, these statistics reveal an underlying lack of regard for the value of the resources that we squander in the production of the goods and packaging that we continue to use up and toss.

Pay As You Throw (PAYT), also known as Unit-Based Pricing, Variable Rate Pricing, User Pay, or SMART (Save Money and Reduce Trash), incorporates two primary principles of environmental policy: “polluter pays” and “shared responsibility.”. Under PAYT, the waste generator is charged for his or her waste generation.

In my reality, garbage collection and disposal should be considered a utility. However, apparently in most of our communities, trash disposal is still treated like a “sacred cow” and residents can dispose of all the trash they want courtesy of tax dollars. So, I ponder,, why isn’t electricity, heating oil, water, or sewer usage paid for via tax dollars? Why is it okay for someone’s taxes to pay for someone else’s waste, but not their electricity or water use? Somehow I just do not understand the difference.

Paying for waste disposal out of the tax base or through a "flat rate system" means that generators do not know their actual costs for disposal. There is no “price signal” given to waste generators, thus they typically pay little attention to the quantity of waste produced. And, there is no economic incentive to reduce, reuse, recycle, or compost.

According to the Econservation Institute, PAYT has been shown to be the “most effective” way to increase recycling, leading to increases in recycling by 50% or more and reduction in landfill disposal by 17%. PAYT allows residents to have control of their disposal costs. It is a “fairer system” making waste disposal like other utilities so that households are only charged for the service they use.

PAYT reduces disposal costs for communities which are increasingly facing more economic demands on their limited monetary resources. PAYT reduces waste disposal costs and the tax revenue needed to cover such costs. And, it is perhaps the most valuable tool communities have to promote waste reduction, increase diversion of materials to recycling and composting/anaerobic digestion, and ultimately improve environmental quality.

To borrow an observation from Neil Seldman who wrote in Governing Magazine in February 2016, “Recycling and garbage are services that come with a cost, and common sense says that they should be priced to reflect local governments' priorities. Recycling should be priced at a discount because it offers abundant social and economic benefits. Garbage should be priced with a surcharge because of its costs to society.”

I would submit that while our focus on recycling commodity markets is important, so too should we start focusing on the fact that garbage hauling and disposal is not free. In fact communities which continue to pay for trash disposal out of property taxes are ignoring the tremendous environmental costs associated with throwing away valuable resources through landfilling or incineration and the economic ramifications that these subsidies have on their own communities.

By Athena Lee Bradley