The territorial government has upped the amount of money it’s willing to pay to help processors manage non-refundable recyclables.
The Department of Community Services announced last week it will spend up to $717,000 on diversion credits to help cover the costs of sending recyclables like cardboard, milk cartons, or tin to Outside processors.
That’s up from last fiscal year when the budget was set at about $600,000. About $500,000 of that ended up being spent that year, the department said.
The amount the government pays to cover non-refundable recyclables varies from item to item.
The city’s budget for diversion credits is $150,000 a year. Diversion rates are negotiated every year.
Dwayne Muckosky, director of community operations at the Department of Community Services, said the budget went up this year because the government expects more recyclables are going to be processed. The department has also increased the amount of money it’s willing to pay per tonne for some items, he said.
“They (recycling companies) just, quite frankly, need support. The returns that they get for the materials that they ship out are just very low now in comparison to a few years ago.”
The market for junk plastic, for example, has become so bad that often the processors can’t find a buyer that will pay anything he said. Instead processors have to pay a fee to have the plastic taken away.
Joy Snyder, executive director of Raven Recycling, said she is grateful for this year’s increase.
“Over the year the commodity prices fell and shipping increased because of the American dollar, so they did a cost of living adjustment,” she said. “That was very much appreciated.”
The increases will be retroactive to April 1. Raven Recycling gets a $100,000 lump sum from the Yukon government at the beginning of every quarter. At the end of the year the government pays the rest of what the company is owed.
On top of the increase in diversion credits the Yukon government is increasing the processing fees paid on refundable beverage containers by 20 per cent. That works out to an increase about $90,000 a year between the two processors, the department said. Deposits paid by consumers will not increase.
This is the first time fees have been increased since Raven Recycling started in 1992, Snyder said.
Snyder said the increase in diversion credits doesn’t dramatically change the organization’s precarious financial position.
When a mandatory curbside recycling program was cancelled by the City of Whitehorse earlier this year, representatives for Raven Recycling said its business model would likely have to change.
Fluctuating commodity prices combined with the fact diversion rates have to be negotiated every year means the organization doesn’t have a consistent funding source, Snyder has said. That makes it difficult to plan ahead or fix aging infrastructure.
Raven has yet to decide on any changes to its operations, Snyder said today.
They’re keen to work with the private sector to bring more recyclables to Raven as a way of increasing its economy of scale, she said.
“We’re looking for more tonnage, we’re keen to work with the private sector. But there will be some operational changes and I don’t know what those are yet.”
Contact Ashley Joannou at ashleyj@yukon-news.com