UPDATE: After months of discussion with the Public Service Commission of West Virginia (PSC), Waste Management has received approval to increase rates for its Bridgeport Hauling operations in the state. The increase will affect an estimated 2,500 commercial customers and 16,250 residential customers across multiple counties.

Rates for residential, commercial and industrial collections will all increase by 8.75%. This will put monthly residential collect fees at $18.40, up from the PSC's original counterproposal of $18.25 after factoring in new information about Waste Management's tax costs. An administrative law judge granted approval to the final proposal, according to transcripts from a June 29 hearing, after hearing arguments from Waste Management about the inflation of general operating costs and supportive testimony from the PSC.

At the hearing, Waste Management requested that the rate increases take effect on July 1. As of publication, the company hadn't heard back from the PSC with confirmation. This will be the first rate increase for the company's Bridgeport Hauling operation since 2009.

Dive Brief:

• Waste Management of West Virginia has filed an application with the state's Public Service Commission (PSC) for a proposed 11.42% rate increase across accounts it services in 11 local counties, as reported by The Preston County News & Journal.
• This would be the first rate increase for the company's Bridgeport Hauling operation since the last one was finalized in November 2009. Residential customers could potentially see their monthly bills increase by $4 or more. An additional $1.50 per bag charge has also been proposed for any account with more than six bags to limit customers sharing service. The increase would generate an estimated $1.23 million in additional annual revenue based on $10.73 million in revenue for 2015.
• The PSC will now conduct an audit of the filing and release a final ruling on the proposed increase. If approved, this could also open up the potential to renegotiate rates for commercial and industrial customers.

Dive Insight:

When asked what factors led to this rate increase request, Waste Management of West Virginia's public affairs office told Waste Dive that it was to "recover inflationary increases of operating cost since our last filing in 2008." According to the company's Form 42 application filed with the PSC additional factors also include, "...increased compensation to drivers, managerial, and administrative employees; increased employee health insurance premiums and coverage; increased liability insurance premiums and coverage; increased workers compensations cost; costs of employee benefits; and cost of new equipment."

Based on the filing, "wages and salaries," "management fees" and workers compensation were among the largest projected operating and maintenance expenses. The company indicated a 2.5% increase in wages for both 2016 and 2017 which could be a sign of increased competition. The ongoing driver shortage has affected companies throughout the industry, including Waste Management, and led some to make their wages more enticing.

These types of rates increases aren't uncommon, especially as the industry continues to wait for a potential resurgence of some commodity prices. While recycling costs weren't explicitly mentioned in the filing they may be playing a factor in the company's financial decisions. Waste Management has shut down about 20% of its recycling facilities and begun shifting away from the weight-based approach that some in the industry say is no longer economically viable.