Pay-As-You-Throw: Not All Methods are Created Equal

What is Pay-As-You-Throw?

Traditionally, residents of cities and towns pay for their trash service via a flat, monthly fee or through their property taxes.  When you think about it, that’s an odd way to pay for a utility service, which is what trash collection is.

After all, we pay for water based on how much of it we use.  Our water is metered.  That’s why we don’t leave lawn sprinklers running in the rain or routinely take 30-minute showers.  It’s the same for electricity.  That’s metered, too, and that’s why we turn the lights off when we leave a room (or at least we try to remember to do that).

With trash, however, its usually different.  When trash service is paid for via a flat fee (or worse, buried in the property tax so it appears to be “free”), residents have no incentive to reduce waste.   As a result, more trash is created, which costs the city and taxpayers more in the long run.  On average, it costs taxpayers $50.59 to dispose of each ton of trash landfilled in the US.1 A small city of 25,000 people will generate, on average, about 11,000 tons of residential trash per year.2 The costs add up quickly (to more than $556,000 per year in this example).

Not only is the traditional system expensive, it’s also unfair.  When everyone pays the same regardless of how much waste they create, those who create the least waste are actually being penalized.  Think about this:  An elderly couple who puts out one 13-gallon bag of trash per week might pay $20 per month for trash service.  The family of six living next door, who puts out five bags per week would also pay the same amount, $20.  Basically, the elderly couple would be subsidizing the family of six.

Pay-as-You-Throw (PAYT) systems use a different approach.  With PAYT, cities and towns treat trash like any other utility:  They charge residents based on how much trash they generate.  These systems are fairer, and they tend to reduce trash, which is good for the environment and good for a city’s budget.

According to the EPA, about 7,100 communities in America use some form of PAYT.3 The problem is, not all forms of PAYT are created equal.  Let’s take a look at the major types and the pros and cons of each.

There are three main types of PAYT system:

  1. Bag-Based
  2. Tag or Sticker-Based
  3. Variable Rate Carts

Most cities and towns with PAYT use some variation of one of the three types above.

Bag-Based Systems

In a bag-based system, cities typically reduce or eliminate the flat trash fee.  Instead, residents pay for their trash service by using pre-paid, official city or town trash bags.  Residents must dispose of their regular household trash in the official bags.  Bulky waste and yard waste are handled differently, and do not need to be placed into the official bags.

Residents can usually purchase the bags at local grocery stores and other retailers…the same places where they would normally buy trash bags.  PAYT bags are more expensive than normal trash bags.  For example, brand-name 30-gallon trash bags might normally sell for about $0.30 per bag.  In a PAYT system, a 30-gallon trash bag might cost $1.00 to $2.00 or more.

That might sound expensive, but it’s important to remember that the price of the bag must not only cover the cost of the bag itself, it also must help cover the cost of trash collection service.  The revenue generated from the sale of the bags goes to the city or town government to pay for trash service.  And remember, it’s expensive to run a trash service.  There are trash trucks, fuel and maintenance costs, employee costs, and don’t forget that average cost of $50.59 per ton to landfill the material.

Bag-based systems are highly effective at reducing waste.  On average, when a city or town gets rid of its flat fee system and goes to bag-based PAYT, annual trash tonnage will drop by 44%.4 In MA, for example, cities that use the traditional approach to trash generate 55% more trash per capita than those who use bag-based PAYT.5

Tag or Sticker-Based Systems

Sticker or tag-based systems are similar to bag-based systems.  Here’s the key difference:  Residents can use any trash bag they want, but each bag of trash must have a pre-paid sticker or tag affixed to it.  The concept is kind of like a large postage stamp that indicates that a bag of trash has been “paid for.”

Residents can usually buy stickers at local grocery stores and retailers.  The money goes to the city to pay for trash service, just like in a bag-based system.

Sticker or tag-based systems are effective at reducing waste.  However, they do have their drawbacks, which limit their effectiveness.  In fact, these systems only reduce waste by about 20%.6 The main reason is that they make it easier for some people to cheat.  For example:

  • People often cut stickers in half, using one sticker for two bags.
  • Some people counterfeit stickers or tags.
  • In many cases, people will put stickers, which are intended for 30-gallon trash bags, on 41-gallon contractor bags.

These cheating techniques reduce the amount of revenue for the city or town, and limit the program’s ability to reduce waste.  In addition, there are other drawbacks to tag or sticker-based systems.  They:

  • Are hard to enforce, as hurried collection workers cannot always check every bag at the curb for stickers.
  • Can drive up the injury rate among collection workers (and workman’s compensation claims) because of lifting bags that are larger than the allowed capacity.
  • Do not work well with automated collection systems, as they become impossible to enforce.

Variable Rate Cart Systems

Variable rate cart systems can only be used with trash carts and automated or semi-automated collection.  In these systems, residents can choose whether they get a small, medium, or large trash cart.  The larger the cart, the higher the monthly fee.

The hope is that to save money, residents will choose the smaller carts and then try to limit the amount of trash they generate each week.  In practice, it doesn’t work out that way.  Residents typically select the cart that most closely matches their current needs, and there is little to no behavior change.

It’s very difficult to assess the effectiveness of cart programs, as they are often combined with other waste reduction interventions (such as overflow bag programs, food waste recycling programs, etc.).  However, an analysis by WasteZero showed that people in variable rate cart systems generate, on average, 629 pounds of trash per person each year.7 Compare that to the 441 pounds per year that people in bag-based systems generate.8 Another analysis shows that variable rate cart systems reduce trash by about 15%.9 Again, that looks weak compared to the 44% reduction seen with bag-based systems.

Variable rate cart systems are also expensive for cities, as carts can cost $50 or more each.  They’re also complex for city staff to manage.

Conclusion

PAYT systems are fairer that flat-rate systems and they’re effective at reducing waste.  But, not all PAYT systems are created equal.  A number of different analyses, including one by payasyouthrow.org, show that properly implemented bag-based systems are the most effective at reducing waste and controlling the cost of trash.

Notes:

  1. Advancing Sustainable Materials Management, Facts and Figures 2014, Released Nov. 2016, US EPA, p. 14, accessible via https://www.epa.gov/smm/advancing-sustainable-materials-management-facts-and-figures-report
  2. Calculation based on data from Advancing Sustainable Materials Management, Facts and Figures 2013, Released June 2015, US EPA, accessible via https://www.epa.gov/smm/advancing-sustainable-materials-management-facts-and-figures-report
  3. US EPA website, accessed 01/30/18: https://archive.epa.gov/wastes/conserve/tools/payt/web/html/06comm.html
  4. WasteZero analysis, based on 225 bag-based systems that it works with in the US. Data from WasteZero’s proprietary WasteZap™ database.
  5. Mohl, Bruce, “Seriously, is this the best we can do?” CommonWealth Magazine, Winter 2015, accessible via https://commonwealthmagazine.org/environment/seriously-is-this-the-best-we-can-do/
  6. WasteZero analysis, based on 100 tag-based systems that it works with in the US. Data from WasteZero’s proprietary WasteZap™ database.
  7. WasteZero analysis, data based on a review of variable rate cart programs in 9 states across the US, 2014
  8. WasteZero analysis of 225 bag-based program that it works with in the US and WasteZap™ database
  9. SCS Engineers, “Pay-As-You-Throw Options—Long-Range Solid Waste Master Plan,” Report to City of Springfield, Mass., Dec. 20, 2010

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