VP of Plant Operations Bill Easterling describes operations at the Montgomery Recycling and Recovery Facility operated by RePower South.
The Montgomery City Council unanimously approved a more than $242 million budget Tuesday after several late amendments, including a $750,000 allocation to buoy the city’s struggling recycling center.
Montgomery Mayor Steven Reed proposed a fiscal year 2021 budget last month that was 6.7% lower than the current budget but avoided layoffs, furloughs, higher health insurance rates or holiday pay cuts to city workers. The city leaned on previous cuts and a higher-than-expected sales tax collections to avoid deeper cutbacks despite the pandemic.
At Tuesday’s meeting, the council allocated an additional $1.835 million for the next fiscal year, money that Finance Director Betty Beville said was expected through a rebound in sales tax revenue in the new year. That includes $900,000 to pay for sanitation service on Saturdays and debris cleanup work that would otherwise have been cut.
Beville said the full budget will be posted on the city Finance Department’s site Thursday.
RePower South, which runs the city’s $35 million waste and recycling center, had asked the council to consider charging each sanitation customer a $2-per-month fee to cover its losses. Instead, the city approved a one-time payment of $750,000 that Council President Charles Jinright said was meant to help them through the next six months, with the hope that the business model turns around by then.
The company took over operations at the city-owned center last year with a plan to make money by selling recycled goods as commodities, but the company said resale prices have crashed since China banned the import of American recycling.
Now, it can cost $50 to process a ton of trash into recycling that can be sold for $35.
Reed credited the impact of federal stimulus payments on the local economy as well as the work of city department heads in putting the city in a manageable situation heading into the new budget year. He said the city has not had to dip into reserves or draw on any lines of credit.
This spring, the city was expecting a fiscal year 2020 shortfall of up to $17 million. But sales and use tax unexpectedly rose about 3% year over year, helping to offset a loss in other areas. That trimmed the 2020 shortfall to around $6 million, money they covered by implementing cutbacks throughout the year.
“The overall shortfall for the year is significantly better than what we expected at the beginning of this pandemic,” Reed said.
Contact Montgomery Advertiser reporter Brad Harper at email@example.com.
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