During Governor Strickland’s State of the State he made the "no new taxes" pledge. However, the Governor did mention that to balance the budget he will propose "new fees, fines and penalties." No specifics were provided, however, now that details are beginning to take shape the Governor Strickland has been criticized for his roll out of the nearly 120 fee increases.
While there are more significant fee increases on vehicle registration and other health care related services, this being an environmental blog, I will focus on the new ODNR and Ohio EPA fee increases. As discussed below, it is going to be more costly for businesses (and residents) to get rid of their waste. This should create even a greater incentive for businesses to look at their practices and see if there are ways to reduce the amount of waste that has to be disposed of in solid waste landfills. This could be through process changes that reduce the amount of waste generated or it could be recycling/re-use of waste materials generated.
However, the ability to recycle or re-use solid waste generated as part of business operations is dependent upon Ohio EPA’s beneficial re-use rules. Unfortunately, those rules have not come forward which makes it more difficult for businesses to evaluate their options. While the fee increases may push evaluation of "greener" alternatives to disposal, businesses face uncertainty as long as clear re-use standards are not established.
Here is a link to a spreadsheet put together by the Ohio Office of Budget Management which shows all the fee increases and the projected revenue (which reaches over $1 billion dollars). Here is a breakdown of the proposed fee increases as it relates to the environment:
Municipal Solid Waste (MSW)
While I was at Ohio EPA, the agency moved from general revenue (GRF) to fees to pay for its programs. The municipal solid waste tipping fee was chosen because it was a broad based fee that touches residents and businesses. Due to its broad based application, the Agency could use the funding to support various programs outside of the Division of Solid and Infectious Waste. Sort of like a tax…right.
The proposed state budget will build upon past fee increases and further increase the MSW tipping fee by $1.25 a ton. This will bring the MSW tipping fee from $3.50 a ton to $4.75 a ton. Of the proposed $1.25 increase, Twenty-five cents would go to ODNR for the Soil and Water Conservation Districts. The remaining $1.00 will go to Ohio EPA to support various programs.
Construction and Demolition Debris (CDD)
The proposed budget will increase the CDD tipping fee by $2.70 a ton. This will bring the CDD tipping fee from $1.70 a ton to $4.40 a ton. This amounts to an 60% increase in the fees for CDD. The $2.70 increase would be divided as follows: $2.25 will go to ODNR for the Soil and Water Conservation Districts and .45 will got to Ohio EPA for operation costs throughout the agency.
Green building practices under the U.S. Green Building Council’s LEED program award points for recycling and reuse of construction waste. With this significant fee increase contractors and project owners should seriously contemplate recycling this material versus disposal even if they are not working on a green building project.
New E-Check Fee
Ohio EPA has proposed an increasing the fee for purchasing new tires by $2.30 per tire. This fee is projected to generated $15 million in new revenue. The previous tire fee was used to pay for programs to eliminate tire dumps around the State. This has been one of the greatest success stories in Ohio. This increase would be devoted to an entirely new purpose-paying for Ohio’s automobile emission testing program (E-check).
Energy Extraction Fees
ODNR for its part has proposed a new fee on oil, coal and natural gas extraction. Together these fees are projected to generate over $7 million in new revenue. The energy extraction fees have not been warmly received by industry who argue that raising costs on these energy related resources will simply result in increased costs for individuals and businesses around the state.
As fees go up for use of resources and disposal of waste, businesses have further incentive to examine green alternatives. This could be improved energy efficiency. establishment of a co-gen facility that could reduce electric fees, recycling, and reduction of waste streams.