The Davis Burn Plant board has tentatively approved a $6.7 million budget that will likely prompt increased garbage rates for residents and garbage haulers.

Meeting Wednesday night, the board approved a 1.2 percent budget increase for fiscal 1990 and discussed raising the fees charged haulers to dump at the burn plant, from $25 to $35 a ton. The dumping fee increase is likely to cost all Davis County residents, except those living in Bountiful, about $1 more a month, said Jim Young, manager of Davis County Solid Waste and Energy Recovery Special Service District.In North Salt Lake, for example, it would raise monthly garbage rates from about $2.76 to $3.87 a month, Mayor Jake Simmons said.

The board will discuss the dumping fee increase and the possibility of charging residential customers who dump at the district's landfill in Layton at its next meeting in May. If approved, the increase would be the fourth since the plant opened and would take effect July 1. At one time, fees were projected to be only about $12.

While some board members balked at the dumping fee increase, Simmons told the board "we had better just plan on it." The district needs to generate $4.7 million in dumping fees to meet expenditures in the new budget.

Clearfield Councilman Kay Chandler objected to the idea that residential customers be charged to dump garbage at the landfill. He said that Clearfield residents were guaranteed they would not be charged to dump there if the city joined the district.

The budget increase is blamed on low natural gas prices and recent soaring interest rates. Since early 1987, falling natural gas prices have affected revenues the burn plant gets from selling steam to Hill Air Force. The steam contract is based on natural gas prices.

More recently, the district had not counted on the high interest rates. In fact, because repayment of the plant's $54 million construction debt is linked to interest rates that have risen to about 7.4 percent from 5.5 percent, the district is likely to have a shortfall on this year's budget. The budget will likely have to be reopened before the fiscal year ends on July 1, Young said.

If the trend in interest rates continues, dumping fees might have to be set as high as $45 by 1992, Board Chairman J.B. Dewell explained.

"There doesn't seem in any way to do other than what has been proposed," Dewell said.