S.T.
you are a wonderful granddaughter!
yes, this is very normal. elderly people get into brain loops and logic has nothing to do with it. don't expect that being reasonable will have any effect. it doesn't mean he's losing it (although some mild dementia would be expected at his age) but this is just a pattern he's seized on and running with.
within reasonable limits, work with him. trashcans with good lids, a big bright trash collection schedule on the fridge, big Xs on the calendar and a promise that you will be there on the right days to help, etc. if he's really out of hand and trash getting knocked over (or, gods forbid, he accuses the neighbors of underhanded garbage sabotage) it may be time to intervene in his living arrangements. hopefully that's not the case yet.
but you rock for taking such good care of him.
khairete
S.