photo by: Journal-World Photo Illustration

Lawrence Journal-World Editorial

The Lawrence City Commission made the right decision in adopting a new rate model for trash collection for downtown businesses.

The city recently discovered that hundreds of businesses had been undercharged for years for trash collection service using the old rate model. Tuesday’s decision to adopt the new rate model means the city will not try to back-bill businesses that were undercharged.

There are 185 businesses that fall under the downtown trash collection rates. A review of rates by MSW Consultants shows that 127 businesses were undercharged and 16 were overcharged. The consultant report states that city records show that the billing errors date back to a billing system conversion that occurred in 2013.

Notably, the consultant’s study showed that it costs the city about $19,000 per month for downtown trash collection. Even though the city is undercharging most businesses, its revenue for downtown trash collection is about $21,000 per month, more than enough to cover costs.

“While we definitely didn’t do it right, we did achieve a balance between our costs and revenues in that area,” Assistant Public Works Director Tamara Bennett told the commission.

Had the city been charging the correct rates, it would be bringing in approximately $36,000 per month for downtown trash collection, an amount that far exceeds what is necessary.

The consultants recommended the city abandon its current rate model, a five-tier system based on square footage and usage and adopt a new rate structure with charges based on the type of business, size of container and frequency of collection. The new rate structure will take effect in November and is expected to generate about $24,000 per month.

Businesses will not be back-billed for their underpayments based on commissioners’ votes. And commissioners agreed to review a report on businesses that were overcharged and decide later what action to take.

City billing errors have been all too common in the past couple of years, so it is disappointing that another problem has been uncovered that potentially cost the city hundreds of thousands of dollars. But in this case, the consultant’s work shows that the downtown business trash rate would have been exorbitantly high had it been charged correctly.

The new structure the commission adopted puts sensible rates in place and doesn’t unfairly penalize businesses for trash rates that were excessive and unnecessary.