Trash Talk About Disposal Rate Increases in Mono County

By Victor Meier

On Tuesday, December 17, 2013 the Mono County Board of Supervisors met for the final meeting of their calendar year.

Mammoth Disposal and Bishop Waste Plant General Manager Rick Vahl along with Mono County Solid Waste Superintendent, Tony Dublino addressed the Board in an attempt to garner their support for raising the floor rate established by local purveyors of waste disposal.

A “floor rate” is simply a baseline budgetary measure (like the minimum wage) implemented to protect small local businesses from predatory rates that may be implemented by larger more resource rich companies. The floor rate is the minimum-maximum amount that a company may charge in order for these local waste disposal businesses to stay competitive and profitable.

Just as with most other businesses there are costs associated with rising inflation and the two determining factors being the Consumer Price Index (CPI) and the Producer Price Index (PPI). The CPI and PPI are both reported on by the Bureau of Labor Statistics (BLS) of the U.S. Department of Labor and is a non partisan agency responsible for measuring labor market activity, working conditions and economic price changes. The BLS collects, analyzes and evaluates various essential economic information to support public and private business related decision-making.

On average over the last year the CPI has increased 1.2% and 1.7% in relation to waste disposal here in the United States. In light of this, Superintendent Dublino proposed franchise amendments to the contracts that Mono County has with D&S and Mammoth Disposal/Bishop Waste that would increase the floor rates and in keeping time with the BLS report and subsequent recommendation. It is the function of such agencies to allow our government to react appropriately.

Board Member from District One, Larry Johnston asked Superintendent Dublino why an increase was needed if PPI costs were down. According the BLS, the Producer Price Index (PPI) program measures the average change over time in the selling prices received by domestic producers for their output. The prices included in the PPI are from the first commercial transaction for many products and some services. A reference to the reduction in diesel fuel costs.

However, other costs are associated with the operation of running a waste disposal company and those costs are attributed to rising CPI costs as well as inflation. “The last CPI increase that we experienced was back in April of 2011,” said Dublino. At that time the waste disposal companies misunderstanding the Board and raised their rates without the Board’s approval. This was such a benign event that the rates were eventually retroactively instated by the Board anyway.

Waste disposal in Mono County is predicted to see a .29 cent rate increase per household, per month in 2014. This may appear nominal and non consequential to the average layperson. However, when you consider the number of households being serviced and doing so over the course of a year, the number in question gains prominence.

Mr. Dublino approached the BOS with a sense of urgency and was promptly met with opposition. The research presented by the BLS was intended for this very purpose and that is more than necessary to be used for evaluation. Supervisor Tim Fesko of District Four suggested that perhaps this issue should have been brought forth to the BOS earlier in the year. “This proposal has been cued up in our process for awhile,” Dublino told the Sheet, “We’ve been waiting on the Board of Supervisors to add our proposal to their agenda.”

Frankly, small businesses often operate on such a small profit margin that not allowing for this rate increase and failing to maintain a solid baseline could really negatively affect one of the few year round, full time positions available in Mono County. As Supervisor Johnston put it, “the floor rate tends to be a defacto rate and is not arbitrary at all.” The difference can be as monumental as whether or not people get much deserved and needed bonuses or raises.

District Two Supervisor, Fred Stump wondered aloud if, “The County might be blamed for these rate increases?” While Supervisor Fesko asserted that the rate increase seemed arbitrary to him and raised concerns for setting prices for businesses. Fesko argued, “The reality is a 1.7% increase in the floor will not create a predatory situation.” Fesko went on to state that he somehow understood the need for a floor rate, yet he simply doesn’t support setting a floor rate at this time.

While it is important to maintain the integrity of an open market there is also a need to look out for the greater good of everyone in Mono County. Teddy Roosevelt saw a similar need to do so and was known as the “Trust Buster”. This concern for fair competition is why we have labor laws and a minimum wage standard in America. The floor price ensures our local small waste disposal businesses the opportunity to compete, provide local jobs and most importantly benefit our local economy.