Almost twice as much money is needed to hit recycling targets as it was 12 months ago, an MRW survey has revealed.
The 2005 State of the Nation report shows the average annual funding councils feel they need to meet the Government's demands has soared from £526,000 to £917,000.
Local authorities in the south east feel they require an average of £1,026,000 per year to meet 2005/6 targets - breaking the million-pound barrier for the first time.
The average in the north of England is £918,000, in the south-west and Wales is £848,000 and in the Midlands is £616,000.
Despite the steep rise in the cost of meeting targets, more councils believe they are receiving the necessary funding than they did last year.
Almost two-thirds of respondents to the 2005 survey believed they were receiving fairly or entirely adequate funding, compared with less than half in 2004.
Only 37% of local authorities told MRW their funding was inadequate, a drop from 52% in last year's report.
The biggest rise in costs has come from the roll-out of kerbside collection. The average council looking to spend 53% of its recycling budget on such schemes in 2005, compared with 39% in 2004.
There have also been slight increases in the costs of the vehicles, boxes, bins and bags associated with kerbside collections.
Meanwhile, councils are looking to spend less of their budget on marketing and communication campaigns and machinery than in 2004.
The rising costs of meeting targets have left councils less confident that they will meet their 2005/6 targets than they were a year ago.
Only a third of respondents to the 2005 survey said they would definitely meet their targets, compared with 40% last year.
Beyond 2005/6, more than four in five local authorities would like to see further statutory targets, with more than half of respondents feeling the average level for 2010 should be between 30% and 49%.