Canada: Obstacles To Waste Diversion

Last Updated: May 25 2012
Article by Dianne Saxe

Ontario's Minister of the Environment says that it is his second highest priority to increase waste diversion from landfill. Can he do it? Yesterday, Dianne gave a well-received keynote address to the Municipal Waste Association on Obstacles to Waste Diversion.In addition to the usual challenges of uncertainty, delay, complexity, and policy instability in a time of financial constraint, Dianne focussed on the economics of the current waste diversion structure; the definition of waste; approvals terms and delays; liability, and the very low tolerance for complaints about odour. If Stewardship Ontario succeeds in its current program direction, the current waste diversion program may relieve municipalities of a substantial burden. But if things don't work out as planned, won't municipalities end up with ultimate responsibility?

Here are some supporting notes on the funding issue:

Drummond Report

  • Does not specifically mention recycling
  • Move towards full cost recovery and user-pay models for environmental programs and services – cost burden of providing service should be placed on beneficiary's shoulders, not the public's1
  • Municipalities provide many services — such as ...waste management — that are governed by provincial legislation and standards. Most municipal revenue comes from local sources, mainly property taxes. Yet provincial transfers account for nearly one-fifth of their revenue, including contributions to cost-shared programs and unconditional funding through the Ontario Municipal Partnership Fund (OMPF).2


  • The Auditor General and the Commission on the Reform of Ontario's Public Services also recommended that greater emphasis be placed on prevention and the polluter-pay principle. This recommendation applies to Ontario's contaminated sites. The Province also recognizes that those responsible for creating pollution and waste should generally bear the costs of environmental programs and services.3
  • Hazardous Waste Fee to be revised – will raise tonnage fees; this is estimated to generate $2.5 million in 2014-15 and on ongoing basis.4
  • See Ministry expenses (all) on p. 195 – plan for 2012/13 for MOE is decrease from $536 million to $486 million
  • " OMPF discussed on pp 51ff

Minister's February 9 2012 letter to WDO Chair

  • " Re move to skills-based board
  • " New regulation made under WDA to implement a new fee-setting methodology that enables Stewardship Ontario to recover full costs of operation of MHSW from stewards & will address creation of deficits/surpluses5
    • New regulation:6
      • Prescribes new methodology Stewardship Ontario (SO) must use to finance MHSW program
      • Replaces fee based on unit/volume [so no more fee schedules]
      • Methodology applies to recovery of ongoing operating costs & accumulated deficits
      • Calculation is "share-of-cost" based on reported "share-of-sales" – i.e., stewards paying for actual costs incurred in each quarter
      • Stewards will be invoiced on actual operating costs every quarter, starting in Q2 (when deficit share invoicing begins, for those materials with deficits)
      • Calculation (see also s. 4 of Reg): quarterly reported quantity by steward as a proportion of total quantity reported to SO x actual cost for that quarter = payment obligation for following quarter
      • Notes that 7 of 9 materials in MHSW program have deficits due to several factors, incl collection volume, inadequate fee rates, higher costs than estimated [these materials are antifreeze; fertilizers; lubricating oil containers of 30 L or less; oil filters; paints & coatings & containers; pesticides; pressurized containers; single-use dry cell batteries; solvents & containers
  • Minister directs WDO to work with the tire and electronic stewardships to develop similar cost recovery and accumulated deficit/surplus recovery approach
  • Directing WDO to review/analyse all proposed IFO budgets and to monitor actual expenditures on ongoing basis & to implement monitoring/audit program to review IFOs' annual performance and achievement of plan targets
  • Industry Stewardship Plans (ISP)
    • Costs of ongoing monitoring, auditing and reporting of ISP will be paid by the plans
    • WDO directed to review its policy & procedures on ISP and consider the following when it reviews an application or approves an ISP:
      • Does ISP achieve diversion targets that are similar or better than the associated waste diversion program?
      • Fair operation of the ISP in the marketplace
      • Does ISP ensure accessibility for consumers through its delivery of services?
      • Before accepting any ISP, WDO must consult with public
      • Directs WDO to submit its proposed policy and procedures on ISP to Minister by June 1 2012
      • Consultations set for May 14 (in person) and written submissions invited from May 1-167
  • Incentive programs
    • Directs WDO to review development and implementation of financial incentives paid to service providers by Stewardship Ontario under MHSW, Electronic Stewardship, WEEE program and Ontario Tire Stewardship – reviews to be carried out in consultation with municipalities and other stakeholders

Info from Stewardship Ontario8

  • SO is the IFO identified under the WDA9 as the organization that develops, funds and operates the Blue Box program and MHSW program
  • Accumulated deficit:
    • July 2008- Dec 2009 – Deficit $573,306
    • 2010 – Surplus of $310,059; accumulated deficit $263,247
    • 2011 – Deficit of $3,309,713; accumulated deficit $3,572,960
  • Upcoming changes
    • Reviews of IFO incentive rates
    • Reviews of WDO budgets/expenditures
    • WDO boards no longer include representatives from industry even as IFO's are required to pay for greater oversight
  • Additional info from SO – general info, backgrounder, FAQ – hard copies provided10
  • MHSW rules – 201211
    • Includes fee rates for various products
    • Published Dec 2011, i.e., before Minister's letter to WDO of Feb 2012

KPMG's Waste Diversion Ontario Review of MHSW Program – Report – April 12 201212

  • Analysis of the Municipal Depot Transportation and Processing Incentive Program (MDT&PIP) [JC note: which was launched by SO in January 2012]
  • Before MDT&PIP, SO reimbursed municipalities for post-collection costs of transporting and processing phase 1 MHSW materials
  • Now, under MDT&PIP,
    • Municipalities no longer required to pay transporters & processors to manage the phase 1 MHSW materials
    • Instead, municipalities select contractors to manage the materials (from list of service providers approved by SO)
    • Municipalities participating in program must operate collection (drop-off) depots for their phase 1 MHSW and other waste – SO compensates them for a portion of costs of operating these depots via fixed hourly rate
    • There are incentive rates for transporters, processors (i.e., the prices SO will pay, on a "take it or leave it" basis)
  • SO sees launching of MDT&PIP as shift from municipally-contracted program to an open market incentive program
  • Municipalities were a customer in the old system; now, they are service providers; KPMG identifies this as a concern as municipalities continue to believe they have jurisdiction for waste management13
  • Report did not address hourly rate paid to municipalities for materials collection at municipal depots or discrete municipal collection events
  • Identified concerns
    • Materials must now be weighed and reported (in past, recorded volume in litres or estimated weight) – service providers want compensation for additional time this takes
    • New system lacks independent verification of processes, procedures, and diversion outcomes in the industry – mistrust among service providers and concerns with oversight of the program by SO suggest that a 3d party may be needed to audit companies, materials, processes the incentive program covers
    • SO may make decisions re rates in a non-transparent and exclusionary manner, making investments by providers riskier – several have said they are unlikely to make long-term investment decisions where a rate decrease is likely
    • In the past, materials other than just MHSW were collected from municipalities as a bundle and then stored at the transfer station; this does not happen with new process
    • No consensus on definition of "extended producer responsibility"
    • Industry assumes financial responsibility for waste diversion, but differences of opinion as to degree that industry (through an IFO) assumes operational responsibility – critical to precisely determine this
    • varying and conflicting views on the roles and responsibilities of stakeholders (e.g., MOE, WDO, SO, municipalities and service providers)
    • confusion re accountability mechanisms required from IFOs to WDO and MOE
    • Municipalities believe they are ultimately accountable for MHSW materials – they are the face of waste diversion to their citizens. If services are compromised, municipal government feel they would be held accountable. However SO says it is responsible once the MHSW materials are dropped off at municipal depot14 – that municipalities provide collection & depot services

Thank you to Jackie Campbell for her assistance in preparing these materials.

1 Drummond report at p. 336

2 Drummond report at p. 66. See the technical guide at Additional links re OMPF at

3 Budget at p. 104

4 Budget at p. 106

5 See Reg 542/06 amendments enacted by O.Reg. 11/12

6 Helpful slideshow at

7 – letter to stakeholders – May 1 2012

8 From Orange drop slideshow slides 20ff at

9 S. 24 of the WDA establishes the IFO. SO is designated as the IFO for the Blue Box waste diversion program under O.Reg. 273/02 and for MHSW under O.Reg. 542/06

10 See website with links –

11 Hard copy attached, see

13 At p. 2 KPMG report

14 In SO's 2012 Reporting Guide – Municipal Depot Transportation & Processing Incentive Program (MDT&PIP) they state: "Title to all Phase 1 MHSW collected by a municipality will belong to Stewardship Ontario from the time of collection, through the chain of custody, until it has been made ready for market use, purchase or safe disposal, at which point title will transfer to the processor and any monies collected will help offset the costs of processing." At

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Dianne Saxe
In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions