Update on Proposed Goshen Trash Fee

On Monday, July 27, the Goshen City Council met and, after much deliberation, unanimously passed Ordinance 5267 establishing an environmental fee on first reading, albeit with a significant amendment. Because it was passed unanimously on first reading, the Council could have chosen to go to a second and final reading and pass the ordinance into law on the same night, but they elected not to do so to allow for more time to analyze the budget impact of additional amendments. Ultimately, what this means is that this ordinance is advancing to second reading at the next City Council Meeting on Monday, August 24, at 6:00PM, at which time it may be amended again and undergo significant changes before a final vote to pass it into law the same evening. 

The amendment introduced by Councilman Donald Riegsecker (R) eliminates the phase-in period and sets the monthly trash fee at $10, which will not cover the full cost of collecting trash, recycling, and brush. As proposed, the ordinance would have phased in the fee until, after three years, the fees collected covered the full amount the city was paying for trash collection. This would have started at $7 per month in 2027, increased to $14.30 in 2028, and then to $22.40 in 2029. The stated reason for this change in approach is that there is some uncertainty around how the changes made by SEA1 will play out in practice; the amendment will give the Council more time to observe and adjust as needed. When the amendment was introduced, Riegsecker expressed a desire to review the amount of the fee annually. According to the nonpartisan and unbiased accounting firm Baker Tilly, the $10 fee will slow down the march towards insolvency, but without additional revenue, it will not stave it off.

While the Council was deliberating on whether to accept this Amendment, Mayor Gina Leichty (D) and Councilman Phil Lederach (D) both reminded the Council that it is important for for the city to have stable and predictable sources of revenue for the purposes of long-term planning, including creating five year plans and negotiating with public employee unions.  The meeting was attended by a large number of firefighters, and the Fire Chief and the Chief of Police both spoke in favor of the environmental service fee. Both described their departments as being among the lowest compensated in the region; both had lost multiple employees in recent years due to dissatisfaction with compensation; both felt that the city needs a stable and predictable source of revenue so that it was able to make long term commitments to these valuable public servants in order to retain them.

It is true that if the Council passes the ordinance as amended, they will collect only somewhat less revenue in the first two years than they would have had they passed the ordinance as proposed, and they can revisit and raise it as necessary in the future, but until they do so, the City can’t plan for that revenue, and they can’t make the commitments that the department heads are saying is necessary. The amendment was accepted by the Council, with the four Republicans (Weddell, Schrock, Nisley, and Riegsekcer) voting yes along with Councilwoman Linda Gerber (D), who voted yes “in the spirit of good faith.” Councilwoman Megan Peel (D) and Councilman Lederach voted no. 

Other potential amendments that were discussed included a proposal to pass the ordinance with the proposed phase-in but stopping after two years, extending the phase-in period over 5 years instead of 3, and an especially interesting proposal made by Councilwoman Gerber to implement a hardship allowance. This proposal, modeled on what Nappanee is already doing, would allow residents below a certain income threshold (TBD) to pay half of the base rate. This would help to alleviate some of the concerns that the shift to fees to fund local government is regressive. It is unclear at this time whether this proposal would reduce revenue or if the base rate would be increased to offset the cost, and if it does reduce revenue to what degree. Councilors Gerber, Riegsecker,and Brett Weddell (R) have committed to meet with Mayor Leichty and Baker Tilly to discuss these and other ideas in order to develop  a better picture of what the budget impacts would be. 

Please find the initial entry in this series here

Author: Kyle Richardson

Editor: Marilyn Torres