Garbage fee starts in April; no late penalties or water cut-offs in 2016

Chicago’s $9.50-a-month garbage collection fee will be tacked on to water bills beginning in April, but it can be paid throughout the year without fear of late fees or water cut-offs, a top mayoral aide said Friday.

Budget Director Alex Holt said the decision to lift the hammer — at least for another year — is tailor-made to ease the transition to a fee that’s a suburban staple, but an uncomfortable first for Chicago.

The decision to be lenient also stems from the fact that the fee is being implemented in April, but took effect on Jan. 1. That means 613,000 Chicago owners of single-family homes and two-, three- and four-flats will be asked to pay catch-up for those months when the unified billing system was being implemented.

That could lead to a bit of sticker shock, when homeowners see the combined bill for water and sewer fees and four months’ worth of garbage fees.

Homeowners with a water meter will receive the new “unified utility bill” that includes water, sewer and garbage fees every two months. Those without a water meter will receive the new bill every six months, as they do now for water and sewer fees alone.

“We know this is a new fee. We want to ease the transition. We’ve waiving the penalties for this year. If people happen to make a late payment this year, we’re not going to take that into consideration,” Holt said.

“Next year, we’ll expect people to pay their bills on time. We don’t cut off water in winter. And we give people a lot of notice before we cut off water. So, it will be some time before you would see anybody have their water cut off for failure to pay their garbage bill. Certainly, it won’t happen at all in 2016 and it won’t happen until well into 2017.”

The garbage fee was approved by the City Council in late October as part of Mayor Rahm Emanuel’s tax-laden 2016 budget.

The garbage fee is expected to raise roughly $65 million a year. That’s just 26 percent of the $244 million the city spends each year collecting household refuse.

It was the biggest point of contention — even more than a $588 million property tax increase for police and fire pensions and school construction — and Emanuel fully understood why.

It’s a new fee for a service many homeowners believe “is kind of baked in” to the normal property tax bill; it will add $114 to the annual cost heaped on 613,000 Chicago owners of single-family homes and two-, three- and four-flats that still get city pickups. Senior citizens get a 50 percent discount.

Ald. Howard Brookins (21st), former chairman of the City Council’s Black Caucus, was so dead set against the idea, he wanted the mayor to cancel the garbage fee and hike the property tax even more to make up for the lost revenue.

Some aldermen were concerned that the garbage fee could escalate, or that the city would switch to a volume-based system, or that the fees could be a prelude to privatization; to appease them, Emanuel agreed to cap it at $9.50 per household until after the 2019 election and segregate the revenue from the fee into an enterprise fund.

On Friday, Holt stressed that the senior discount would be available only to those senior citizens who already receive the Cook County Assessor’s Senior Freeze exemptions on their property tax bill. The property tax break is available only to seniors whose annual household income does not exceed $55,000.

Some aldermen have argued that a flat monthly fee is unfair. To encourage recycling and discourage homeowners from hoarding city-provided refuse containers, they want the city to impose a “volume-based” fee for each container.

On Friday, Holt said that’s still a possibility and the Emanuel administration will begin to examine how a volume-based system might work in Chicago later this year after the billing process gets rolling.

“We committed during budget hearings to looking at whether a per-can charge would work. But that will require a lot of work and a lot of thinking,” Holt said.

“I know it works in a lot of communities. But, we have some issues we need to work through. Sanitation is the primary issue. We want to make sure we continue to have clean neighborhoods. We also need to think about a fee structure. What size can? How much do you charge? All of those factors need to be considered. In some communities, it’s absolutely more fair. But we have to look at what a fair structure would look like in Chicago.”

Apparently concerned about a political backlash, Holt continued to stress that Chicago’s $9.50 monthly fee will be a relative bargain.

Berwyn residents pay $24.79 a month. In Oak Park, it’s $23.88. Harvey residents pay $21.41. Evanston residents, $17.95.

Chicago residents living in buildings with five or six residential units pay private garbage haulers between $10 and $16 a month, she said.