LOL...we had the same thing here in California thirty years ago. The curbside recycling programs were so successful that the amount of waste going to the dump went way down and the garbage company had to jack rates way up.
I never could figure that out, though. Maybe their contract stipulated they were paid by the ton collected.
Same thing with water usage, government tells public to cut done on water use during a drought, the water company Jack’s up rates
People cut their water use and the water department lost money.
The solution? Increase water rates.