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Garbage revenues can pile up

| Sunday, Nov. 23, 2003, 12:00 p.m.

Millvale charges its residents $34 a quarter for trash pickup, while the borough pays only $25.50 per household for the service.

Millvale is one of several local communities that bill residents for trash collection -- passing on costs for billing and delinquencies and funneling extra revenue through the borough's municipal budget for other uses.

Other municipalities also cash in on their trash billing.

McKeesport tacks on an extra $200,000 in service fees for its $1.1 million in trash collection. The extra money subsidizes public safety costs in the city, officials said. Butler Township tacks on a "franchise fee" to its trash bill. In Wilkinsburg, the council voted to increase its trash fee in 1999 despite receiving a lower-than-anticipated bid from its hauler.

"There are some that are using it as -- how do you say -- a tax that's not a tax," said Ed Vogel, vice president of Vogel Disposal Service Inc. of Mars, which hauls solid waste for Millvale and several other municipalities in the North Hills.

Under state law, municipalities can set their price for trash collection, even if it is considerably higher than what the service actually costs.

Some municipalities separate fees for trash collection and other services from general operating costs.

Shaler Manager Tim Rogers said separating utility bills from property taxes creates a more transparent financial picture for municipalities.

"If you commingle (utilities with taxes), you do not get a true picture of the taxes or water or sewer rates," Rogers said.

McKeesport's trash fees subsidize city services unrelated to trash, such as fire and police expenses, city administrator Patricia Monoyoudis said.

Former Wilkinsburg Councilwoman Alexis Nedley said that in 1999, she voted against raising the municipal service fee from $115 to $130 per year at a time when Waste Management's bid came in lower than expected.

"We had been told that if the bids for trash collection with Waste Management came in lower, they would in turn lower the municipal fee," Nedley recalled. "The bid was lower, but they still wanted to raise the fee, so when it came up I voted against it."

The current fee is $140. Some of money above the cost of trash collection goes for general borough expenses.

"It's not that they're hiding that fact, but the public doesn't ask," Nedley said.

Although he is unsure of the distribution formula, Wilkinsburg Manager Wes Johnson said some of the money collected from the municipal service fee is used for code enforcement and fire protection.

Virgil Puskarich, executive director of the General Assembly's Local Government Commission, said that to his knowledge, residents in the state have not challenged the practice.

"Generally speaking ... a fee isn't supposed to be a money-making charge," Puskarich said. "But how much is too much, it's pretty difficult for me to say. ... You tell me someone is taking water money and using that money to fund roads or police, or sewer money, it's not much of a nexus there."

Etna, Sharpsburg, Blawnox, Crafton and Bellevue also bill residents for trash collection, and the difference between what they charge residents and what the haulers charge the borough varies from as little as 6.4 percent in Bellevue to Sharpsburg's 23 percent.

Other municipalities roll the cost of trash pickup into property taxes, such as Fox Chapel, O'Hara, Mt. Lebanon, Bethel Park and South Fayette. Pittsburgh does not charge a trash collection fee, although one has been suggested to help ease the city's financial problems.

In many municipalities, the trash hauler bills customers directly.

Millvale officials say their 33 percent markup is necessary to pay for billing costs, delinquencies and trash-related infrastructure such as Dumpsters used for borough road projects and special events.

Millvale manager Virginia Heller said the borough would have to raise other taxes or fees if its trash collection bills were lowered.

"It's not like people are getting ripped off," Heller said. "If we don't charge (for trash collection) that way, we're going to have to charge something somewhere else, like having a higher millage rate."

Heller said one reason for higher trash collection rates is the borough's high rate of delinquency. The borough fell $18,615 short -- about 9 percent -- on its trash fee collections for 2002.

Still, last year the borough took in $181,385 from ratepayers -- 32 percent more than the $137,652 it was charged by its hauler.

Scott Wagner, president of Penn Waste Inc., a York-based hauler, said that number could be justified.

"That may not be unreasonable," Wagner said. "Collections are getting tougher and tougher. You've got to make phone calls, beat on people's doors. These municipalities can't employ people for free."

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