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Home My WebLink AboutSWAG agenda 110316Agenda Solid Waste Advisory Group November 3, 2016 — 5:30 p.m Solid Waste Oaerations Center 1. Call to Order —Chair 2. Approve Meeting Summary September 16, 2016 — Chair, Attachment 3. Solid Waste Enterprise Fund Financial Planning (Revised) Final Report — Bob Dick, Project Manager and Ryan Duckett, Staff Engineer - SCS Engineers, PC, Attachment Note: September SWAG follow -up items are not yet complete will be distributed prior to the meeting. 4. Financial Plan — Options & Recommendations - Bonnie Hammersley, County Manager 5. Pending Matters a. County Waste Reduction Goal Setting — JD Freeman, Carrboro Public Works Director, Lance Norris, Chapel Hill Public Works Director, Ken Hines, Hillsborough Public Works Director and Gayle Wilson, County Solid Waste Director, BJ Tipton, UNC Solid Waste Program Manager, Attachment 6. Updates /Status Reports a. First Quarter FY 2016/17 Solid Waste Program Data Report — Cheryl Young, County Research & Data Manager b. Status of Eubanks Road Waste & Recycling Facilities Improvements — Gayle Wilson, County Solid Waste Director c. Waste Composition Study Update — Blair Pollock, County Solid Waste Planner d. Shred -a -thon Update — Blair Pollock, County Solid Waste Planner e. County Mattress Disposal Program — Gayle Wilson, Solid Waste Director, Attachment 7. Public Comment— Chair 8. Next Meeting —There are no additional meetings scheduled. Please bring your calendars. 9. Adjourn — Chair Dinner will be provided Memorandum To: Solid Waste Advisory Group From: JD Freeman, Carrboro Public Director Lance Norris, Chapel Hill Public Works Director, Wendy Simmons, Chapel Hill Solid Waste Services Manager Ken Hines, Hillsborough Public Works Director Gayle Wilson, County Solid Waste Director, Allison Lohrenz, County Recycling Programs Manager, Blair Pollock, County Solid Waste Planner, Cheryl Young, County Research & Data Manager BJ Tipton, UNC -CH Solid Waste Program Manager Date: November 3, 2016 Subject: SWAG Follow -up: County -wide Waste Reduction Goal At the September 16, 2016 SWAG meeting the Group requested that staff discuss what waste reduction goals are possible /reasonable for the SWAG to consider, should the goal be incremental and should the goal be open -ended or defined by deadlines? Town and county staffs met and engaged in a wide - ranging discussion of the various issues related to setting a new goal. A general consensus was reached among staff and an overview of our discussions and conclusions is provided below. 1. Waste Reduction Definition and Calculation Staff first confirmed what the waste reduction goal actually represents. It is the amount of waste per capita from a county that is currently calculated and reported by the State Division of Solid Waste Management as disposed in a landfill as compared to the amount of waste disposed per capita from a base year of 1991/92. For Orange County, 131,067 tons were reported as disposed in FY 1991/92 (1.36 tons per capita) versus 69,281 tons disposed for FY 14/15 (0.495 tons per capita) for a waste reduction rate of 64 %. 2. Illustration of Additional Tonnaee Reduction Necessary to Achieve Higher Goals The amount disposed by Orange County residents, businesses, and construction projects throughout the county and UNC last year was 69,281 tons of waste in landfills. This averages out to 990 pounds per County resident, or a waste reduction rate per person of 64 %. The waste reduction rate is compiled from data of the base of 1991 -1992 when the average pounds disposed by resident was 2,720 pounds. The table below shows the additional amount of waste that would have to be diverted from landfilling to achieve a 70 %, 80% and 90% waste reduction rate. Waste Reduction Rate desired Additional Tons needed to be Diverted 70% 11,908 80% 30,799 90% 50,040 3. University Waste Reduction Obiective The University announced a zero waste initiative. Their goal as stated in the Gazette (10/12/16) is a targeted 95% reduction including cutting total incoming waste by 50% and then recover 90% of remaining waste through recycling and composting. No plans have been adopted or developed that communicate how such a policy would be implemented or the objective achieved and in what time period. The University's current recovery rate is 47 %. Their per capita waste reduction to landfill rate from the base year of FY 1991 -92 is 42% (not counting coal ash). 4. General Staff Observations ➢ Staff detects no perception from public or elected officials of interest in reducing or eliminating existing programs or services. ➢ Current programs are working at a commendable level of efficiency and cost - effectiveness. ➢ It is essential to resolve the current $2,000,000 budget gap and implement a new financial plan before seriously contemplating further investment in waste reduction programs. ➢ The "low hanging" waste reduction fruit has already been harvested; additional substantive waste reduction will be increasingly expensive and challenging and will require creativity and innovation. ➢ A careful and systematic process will be necessary to identify future direction of waste reduction programs and achieve more assertive goals. ➢ Any existing program or service reductions are likely to result in increased tons disposed and a decrease in local waste reduction goal attainment. 5. General Program Planning Components toward Achieving Additional Waste Reduction ➢ More education and outreach. ➢ New programs and services. ➢ Examine new and improved collection or processing methodologies. ➢ Improvements to existing programs and services. ➢ New or different regulations, ordinances, and potential enforcement. ➢ New and better markets for the sale of recyclables. ➢ Pursue new materials or focus on materials identified as available in larger amounts through waste composition study. ➢ Focus on or pursue new or currently underserved waste generation sectors (Commercial). ➢ New or improved expanded disposal or processing facilities. ➢ Consider enhanced influence or oversight of private waste collection services. ➢ Continued cooperation and collaboration between the Towns, County, University, and UNC Hospital. 6. How to Identifv Additional Reasonable Waste Reduction ODDortunities ➢ Examine waste characterization data o What potential recyclable materials remain in the waste stream, in what quantities and from which service sectors? ➢ Establish process to convert waste characterization data into new or improved program options • Determine recovery potential for these identified materials. • Develop programmatic means and methods for capturing targeted materials. • Identify facility improvements or new facilities that enable materials collection, processing and /or transfer. • Determine cost estimates for new or improved programs and availability of funding. • Confirm markets for these identified materials. • Consider public acceptance for potential program enhancements. • Conduct pilot studies of programs as necessary. ➢ Consider proven technologies that may aid in waste reduction progress. ➢ Examine how to make enforcement more effective and productive. 7. Refine Process to Develop Strategies for Goal Identification and Implementation ➢ Complete waste characterization study. ➢ With assistance of recycling consultant, staffs perform the analysis and construct a draft plan following the elements noted in section 6 above. o Analysis likely to take one to two years. ➢ Staff recommends a mix of program and service options and, based on estimated tonnage capture or reduction at the source, recommends a corresponding new waste reduction goal. o Includes funding requirements and source(s) that are consistent with adopted solid waste financial plan. ➢ Recycling Plan Adoption and Implementation ( SWAG /Managers /Staffs /Jurisdictions elected bodies) • Include goal achievement timelines and deadline as /if desired (not required). • Propose new goal be established by additional tonnage diverted from disposal. • Conduct public workshops, forums or other outreach as necessary to obtain public input. • Assumes significant supporting education and outreach for public understanding and acceptance. ➢ Achieve new waste reduction goal —continue to lead state and region in waste reduction. Note: This strategy does not include the necessary political process and represents only the more technical and operationally associated staff viewpoints. Should the SWAG agree with the staff approach a political and public input process would of necessity have to be established to guide, monitor and provide the necessary decision making. 3 Cnnrlusinn The staffs' have reached a general consensus that a more deliberate solid waste reduction plan development process should be established. This is due to the potential budgetary impacts on the solid waste enterprise fund, the careful and methodical analysis necessary to formulate new cost - effective programs, services and policies, the examination of market risk and the need to develop realistic public and elected official waste reduction expectations. In staff's opinion, the development of a well thought - out strategic waste reduction plan is required that will inform the SWAG and the elected boards of what waste reduction objectives could be pursued and at what cost. Following the completion of the waste composition study in April 2017, the staff's recommend devoting the next one to two years to preparing such a strategic plan, with the aid of a professional consultant as necessary. It is believed that a minimum of one year and probably longer would be required, which would also allow time for implementation of the new financial plan to be initiated, paving the way for consideration of additional investments in waste reduction and perhaps even opportunities for new revenue. Adoption of a new waste reduction goal and the careful examination of solid waste management regulatory, operational, market, policy, funding, public acceptance factors, coupled with waste composition data, are interdependent. Options for further waste reduction should be based on data and technical analysis, staff knowledge and experience and consultant technical expertise, while avoiding unnecessary financial risk for the enterprise fund. In the interim, staffs' suggest maintaining the existing 61% waste reduction goal, or if the SWAG feels so inclined, adopt an interim goal of 65% that may be achieved by improved application of and /or enhanced education for current programs and services and limited additional expenditures. 4 10 -29 -2015 URBAN RECYCLING PROGRAM SUMMARY BY JURISDICTION* TOTAL SINGLE- URBAN CURBSIDE COLLECTION PROGRAM ** MUTLI- FAMILY COLLECTION' COMMERCIAL COLLECTION' STREAM COLLECTION ANALYSIS TONS TONS TONS TONS o� SETOUT RATE SETOUT RATE SETOUT RATE SETOUT RATE % CHANGE FROM PREVIOUS YEAR PARTICIPATION RATE PARTICPATIO N RATE PARTICPA TION RATE PARTICPATIO N RATE % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR CARRBORO FY 14/15 FY 15/16 FY 16/17 FY 13/14 CHANGE SETOUT SETOUT SETOUT SETOUT % CHANGE PARTICIPATION PARTICPATIO PARTICPA PARTICPATIO % CHANGE FY 13/14 FY 14/15 FY 15/16 FY 16/17 % CHANGE 1,098 1,418 1,366 1,439 % CHANGE CHAPEL HILL TONS TONS TONS TONS FROM RATE RATE RATE RATE FROM RATE N RATE* TION RATE N RATE FROM TONS TONS TONS TONS FROM TONS TONS TONS TONS FROM 66% TONS TONS TONS PREVIOUS PREVIOUS PREVIOUS RATE RATE SETOUT RATE FROM RATE N RATE TION RATE N RATE FROM TONS TONS TONS TONS FROM TONS TONS TONS TONS FROM 65% TONS PREVIOUS PREVIOUS YEAR TONS FROM RATE RATE RATE SETOUT RATE FROM RATE N RATE TION RATE N RATE 257 TONS TONS TONS TONS 4th Quarter TONS YEAR TONS TONS 0 66% YEAR PREVIOUS YEAR PREVIOUS PREVIOUS PREVIOUS YEAR FY 13/14 FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 FY 13/14 FY 13/14 FY 14/15 FY 15/16 FY 16/17 FY 13/14 FY 13/14 FY 14/15 FY 15/16 FY 16/17 PREVIOUS FY 13/14 FY 14/15 FY 15/16 FY 16/17 1st Quarter 1st Quarter FY 14/15 359 329 361 10% 81% 50% 37% 48% 32% - 85% 66% 87% 31% 95 90 85 99 17% 46 55 48 46 -4% 2nd Quarter 8 358 378 #DIV /0! #DIV /0! 79% 50% 43% #DIV /0! #DIV /0! 7717. 85% 77% #DIV /0! #DIV /0! 94 86 87 #DIV /0! #DIV /0! 52 54 53 #DIV /0! #DIV /0! 3rd Quarter 350 362 #DIV /0! #DIV /0! 76% 51% 50% #DIV /0! #DIV /0! 0 84% 83% #DIV /01 #DIV /01 86 81 84 #DIV /0! #DIV /0! 49 54 52 #DIV /0! #DIV /0! 4th Quarter 347 351 #DIV /0! #DIV /0! 80% 48% 43% #DIV /0! #DIV /0! 0 85% 82% #DIV /0! #DIV /0! 94 86 94 #DIV /01 #DIV /0! 49 57 44 #DIV /0! #DIV /0! Annual 6 1,413 1,420 1 #DIV /0! #DIV /0! 79% 50% 43% #DIV /0! #DIV /0! o 85% 77%1 #DIV /0! #DIV /0! 368 1 344 350 1 #DIV /0! #DIV /0! 1 1961 220 197 #DIV /01 #DIV /0! TOTAL SINGLE- URBAN CURBSIDE COLLECTION PROGRAM ** MUTLI- FAMILY COLLECTION * ** COMMERCIAL COLLECTION' STREAM COLLECTION ANALYSIS TONS TONS TONS TONS o� SETOUT RATE SETOUT RATE SETOUT RATE SETOUT RATE % CHANGE FROM PREVIOUS YEAR PARTICIPATION RATE PARTICPATIO N RATE PARTICPA TION RATE PARTICPATIO N RATE % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR HILLSBOROUGH FY 14/15 FY 15/16 FY 16/17 FY 13/14 CHANGE SETOUT SETOUT SETOUT FY 14/15 %CHANGE PARTICIPATION PARTICPATIO PARTICPA PARTICPATIO %CHANGE FY 13/14 FY 14/15 FY 15/16 FY 16/17 % CHANGE 1,098 1,418 1,366 1,439 %CHANGE CHAPEL HILL 46% 0 487 38% CHANGE SETOUT SETOUT SETOUT 25% %CHANGE PARTICIPATION PARTICPATIO PARTICPA PARTICPATIO FROM 289 252 251 0% FROM 1,237 1,410 1,481 - FROM 66% TONS TONS TONS TONS FROM RATE RATE RATE SETOUT RATE FROM RATE N RATE TION RATE N RATE FROM TONS TONS TONS TONS FROM TONS TONS TONS TONS FROM 65% TONS TONS TONS TONS FROM RATE RATE RATE SETOUT RATE FROM RATE N RATE TION RATE N RATE 257 TONS TONS TONS TONS 4th Quarter TONS TONS TONS TONS 0 66% PREVIOUS PREVIOUS YEAR PREVIOUS PREVIOUS PREVIOUS 80% FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 298 FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR PREVIOUS PREVIOUS YEAR FY 15/16 FY 16/17 YEAR 1st Quarter FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 48% FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 14/16 FY 14/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR 1st Quarter - 8 869 902 —77. 64°0 45°o 3-677. 48 ° 35 °0 - 7717. 6-57. 8117. 24% 196 81 18 9 —1-67 16 9 168 205 22°0 2nd Quarter 0 0 0 0 0 1 24 2 # D I 4 38 1 =77M7 . 3rd Quarter 0 0 0 0 0 26 40 1 . 4th Quarter 6 0 0 0 # o o I —771 155 1 IV 0. I # . nnua V 0 0 4U%I.l o 0 D 4 IV 0. I #DIV TOTAL SINGLE- URBAN CURBSIDE COLLECTION PROGRAM" MUTLI- FAMILY COLLECTION * ** COMMERCIAL COLLECTION' STREAM COLLECTION ANALYSIS TONS TONS TONS TONS o� SETOUT RATE SETOUT RATE SETOUT RATE SETOUT RATE % CHANGE FROM PREVIOUS YEAR PARTICIPATION RATE PARTICPATIO N RATE PARTICPA TION RATE PARTICPATIO N RATE % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR HILLSBOROUGH FY 14/15 FY 15/16 FY 16/17 FY 13/14 CHANGE SETOUT SETOUT SETOUT FY 14/15 %CHANGE PARTICIPATION PARTICPATIO PARTICPA PARTICPATIO % CHANGE FY 13/14 FY 14/15 FY 15/16 FY 16/17 % CHANGE 1,098 1,418 1,366 1,439 % CHANGE 67% 46% 0 487 38% - 80% 659/. 0 25% 312 297 271 298 10% FROM 289 252 251 0% FROM 1,237 1,410 1,481 - FROM 66% TONS TONS TONS TONS FROM RATE RATE RATE SETOUT RATE FROM RATE N RATE TION RATE N RATE 273 TONS TONS TONS TONS 3rd Quarter TONS TONS TONS TONS -100% 65% 42% 0 PREVIOUS PREVIOUS PREVIOUS 79% 0 281 266 266 257 284 283 o 4th Quarter 1,163 1 1,351 1 1,490 0 66% PREVIOUS PREVIOUS YEAR 80% FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 298 FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 YEAR 1st Quarter - 166 168 176 5% 55% 41% 31% 46% 48% - 76°0 65% 78% 20% 27 25 5 7 21% 32 39 35 57 62% 2nd Quarter 0 0 0 0 0 26 24 # 36 38 3 I 3rd Quarter 0 o o 0 0 1 24 2 # D I 4 38 =77M7 # I 4th Quarter 0 0 0 0 ° 26 40 75'71771— nnua 6 ° o o # 0 0 I —771 155 1 —771777 . TOTAL SINGLE- URBAN CURBSIDE COLLECTION PROGRAM ** MUTLI- FAMILY COLLECTION' COMMERCIAL COLLECTION' STREAM COLLECTION ANALYSIS TONS TONS TONS TONS % CHANGE FROM PREVIOUS SETOUT RATE SETOUT RATE SETOUT RATE SETOUT RATE % CHANGE FROM PREVIOUS YEAR PARTICIPATION RATE PARTICPATIO N RATE PARTICPA TION RATE PARTICPATIO N RATE % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR TONS TONS TONS TONS % CHANGE FROM PREVIOUS YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 FY 13/14 FY 14/15 FY 15/16 FY 16/17 FY 13/14 FY 14/15 FY 15/16 FY 16/17 FY 13/14 FY 14/15 FY 15/16 FY 16/17 FY 13/14 FY 14/15 FY 15/16 FY 16/17 1st Quarter 1,098 1,418 1,366 1,439 5% 67% 46% 0 487 38% - 80% 659/. 0 25% 312 297 271 298 10% 241 289 252 251 0% 2nd Quarter 1,237 1,410 1,481 - 100 °0 66% 45% o #DIV 0. 807. ° 77M77= #D 307 282 279 -100% 273 287 - -1 o 3rd Quarter 1,198 1,384 1,422 - -100% 65% 42% 0 79% 0 281 266 266 257 284 283 o 4th Quarter 1,163 1 1,351 1 1,490 0 66% 46% 0 80% ° 308 283 0 261 298 o Annual 5,760 1,439 0 % 457. 0 0 0 0 0 * Due to the integrated nature of recycling collection operations throughout the county which helps to ensure efficient and optimal collection services, there is some minor overlap of collection services by program areas, e.g. The commercial recycling route collects some multi - family locations. To the extent possible, these variations in service collection are apportioned to each specific program accordingly. ** The total tons by jurisdiction in the Urban Curbside Collection program is apportioned according to the participation rate and number of homes by jurisdiction. This assumes that each cart collected at the curb has the same average weight when collected. * ** Tons are apportioned in the Multi - Family and Commercial programs based on the average number of carts collected in each jurisdiction at each MF /Commercial site for that quarter. This assumes that each cart collected at each site has the same average weight when collected. NOTES: Participation Rate - the proportion of households served that take part in the curbside collection program at least once per month. Setout Rate - the proportion of households that set out their recycling cart in any given week. 10 -29 -2015 OTHER COLLECTION PROGRAMS RURAL CURBSIDE COLLECTION PROGRAM NOTE: it is not possible given current data collection constraints to gather particpation rates in the rural program. 24 -HOUR DROP -OFF SITES - SINGLE STREAM* BRADSHAW QUARRY o EUBANKS RD �o SETOUT SETOUT SETOUT %CHANGE % CHANGE CHANGE CHANGE % CHANGE % CHANGE TOTALFOR FROM TOTALFOR TOTAL FOR %CHANGE RURAL CURBSIDE TONS TONS TONS TONS CHANGE RATE RATE RATE SETOUT RATE FROM 1 308 CARRBORO PLAZA FROM CEDAR FALLS FROM HAMPTON POINT (HOME DEPOT) PREVIOUS MEADOWMONT PREVIOUS UNIVERSITY MALL PREVIOUS COLLECTION FROM PREVIOUS PREVIOUS YEAR FY 13/14 FY 14/15 FY 15/16 FY 16/17 PREVIOUS FY 13/14 FY 14/15 FY 15/16 FY 16/17 PREVIOUS YEAR 1st Quarter 435 422 588 712 21% 38% 41% 44% 45% 2% 2nd Quarter 486 451 607 0 -100% 35% 44% 44%1 130 1 -100% 3rd Quarter 396 484 615 0 -100% 35% 40% 44% 123 -100% 4th Quarter 442 590 601 0 -100% 40% 42% 44% 44 -100% Annual 1,759 1,947 2411 712 -70% 37% 42% 44% 34 -100% NOTE: it is not possible given current data collection constraints to gather particpation rates in the rural program. 24 -HOUR DROP -OFF SITES - SINGLE STREAM* * Corrugated cardboard is not included in the single- stream tonnage. Cardboard is collected separetely from single stream in an integrated manner across program and jurisdictional boundaries and is included in the annual repor TOTAL SINGLE - STREAM FOR ALL DROP -OFF SITES BRADSHAW QUARRY o EUBANKS RD �o % CHANGE %CHANGE % CHANGE %CHANGE % CHANGE CHANGE CHANGE % CHANGE % CHANGE TOTALFOR FROM TOTALFOR TOTAL FOR TOTAL FOR TOTAL FOR PREVIOUS 1st Quarter FY 2013/14 FY 2014/15 FY 2015/16 FROM YEAR FROM 501 FROM 1 308 CARRBORO PLAZA FROM CEDAR FALLS FROM HAMPTON POINT (HOME DEPOT) PREVIOUS MEADOWMONT PREVIOUS UNIVERSITY MALL PREVIOUS 351 FY13 /14 FY14 /15 FY15 /16 FY16 /17 PREVIOUS PREVIOUS YEAR YEAR YEAR YEAR FY13 /14 FY14 /15 FY15 /16 FY16 /17 FY13 /14 FY14 /15 FY15 /16 FY16 /17 FY13 /14 FY14/15 FY15/16 FY16 /17 FY13/14 FY14 /15 FY15 /16 FY16/17 1st Quarter 121 108 92 99 8% 61 49 26 29 11% 130 129 80 91 14% 50 39 30 41 38% 138 123 80 75 -6% 2nd Quarter 115 119 107 0 1 -100%1 68 44 28 0 -100%1 147 125 99 0 -100%1 53 37 34 0 1 -100%1 169 109 94 0 1 -100 o 3rd Quarter 119 70 96 0 -100% 58 42 31 0 -100%1 124 105 81 0 -100% 52 37 35 0 1 -100%1 137 98 91 0 -100% 4th Quarter 115 102 101 0 -100%1 62 33 32 0 100% 125 79 90 0 100% 55 33 38 0 100% 149 84 89 0 100% Annual 469 1 398 1 395 99 _75%I 249 1 168 118 29 75% 527 439 350 91 74% 210 145 137 41 70% 593 413 354 75 -79% * Corrugated cardboard is not included in the single- stream tonnage. Cardboard is collected separetely from single stream in an integrated manner across program and jurisdictional boundaries and is included in the annual repor TOTAL SINGLE - STREAM FOR ALL DROP -OFF SITES WASTE & RECYCLING CENTERS RECYCLING - SINGLE - STREAM* BRADSHAW QUARRY o EUBANKS RD �o FERGUSON RD %CHANGE HIGH ROCK %CHANGE WALNUT GROVE CHANGE CHANGE % CHANGE TOTAL FOR TOTALFOR FROM TOTALFOR TOTAL FOR TOTAL FOR TOTAL FOR PREVIOUS 1st Quarter FY 2013/14 FY 2014/15 FY 2015/16 FY 2016/17 YEAR 1st Quarter 501 448 1 308 336 9% 2nd Quarter 551 434 363 - -100% 3rd Quarter 490 351 333 - -100% 4th Quarter 506 331 350 -100% Annual 2,048 1,563 1,353 336 -75% WASTE & RECYCLING CENTERS RECYCLING - SINGLE - STREAM* * Corrugated cardboard is not included in the single- stream tonnage. Cardboard is collected in an integrated manner across program and jurisdictional boundaries and is included in the annual repor TOTAL SINGLE - STREAM FOR ALL WASTE & RECYCLING CENTERS BRADSHAW QUARRY o EUBANKS RD 0 CHANGE FERGUSON RD %CHANGE HIGH ROCK %CHANGE WALNUT GROVE %CHANGE CHANGE % CHANGE TOTAL FOR TOTALFOR PREVIOUS FY 2013/14 FY 2014/15 FY 2015/16 FY 2016/17 1st Quarter 372 470 348 298 -14% 2nd Quarter 356 1 474 1 376 1 -100% 3rd Quarter 315 391 350 -100% 4th Quarter 342 387 372 1 - -100% Annual 1, 384 1,723 1,447 FROM FROM FROM FROM FROM PREVIOUS PREVIOUS PREVIOUS PREVIOUS PREVIOUS YEAR FY13 /14 FY14/15 FY15/16 FY16/17 YFAR FY13/14 FY14 /15 FY15 /16 FY16 /17 FY13/14 FY14/15 FY15 /16 FY16 /17 YEAR FY13/14 FY14/15 FY 15/16 FY 16/17 YEAR FY13 /14 FY14 /15 FY15 /16 FY16 /17 YEAR 1st Quarter 53 64 56 43 -24% 112 109 77 79 3% 88 105 70 67 -4% 75 79 52 44 -14% 44 114 93 65 -30% 2nd Quarter 56 71 63 0 1009/. 125 1 104 75 0 -100% 94 108 82 0 1 -100%1 81 1 77 1 58 0 -100%1 0 1 112 1 98 0 1 -100% 3rd Quarter 52 60 54 0 -100%1 109 94 82 0 - 100% 87 80 67 0 100% 66 63 60 0 -100% 0 95 87 0 -100% 4th Quarter 55 63 60 0 -100%1 118 87 82 0 -100% 92 79 78 0 -100% 77 63 57 0 -100% 0 95 96 0 -100% Annual 215 258 233 43 -82% 464 395 316 79 -75% 362 372 297 67 1 -77%1 299 1 282 226 44 -80% 44 415 374 65 -837. * Corrugated cardboard is not included in the single- stream tonnage. Cardboard is collected in an integrated manner across program and jurisdictional boundaries and is included in the annual repor TOTAL SINGLE - STREAM FOR ALL WASTE & RECYCLING CENTERS 0 CHANGE FROM TOTALFOR TOTAL FOR TOTAL FOR TOTALFOR PREVIOUS FY 2013/14 FY 2014/15 FY 2015/16 FY 2016/17 1st Quarter 372 470 348 298 -14% 2nd Quarter 356 1 474 1 376 1 -100% 3rd Quarter 315 391 350 -100% 4th Quarter 342 387 372 1 - -100% Annual 1, 384 1,723 1,447 -100% ,:- A-- Final Report Financial Plan and Rate Study for Solid Waste Enterprise Fund Prepared for: GRANGE COUNTY NORTH CAROLINA Solid Waste Management Department 200 South Cameron Street Hillsborough, NC 27278 (91 9) 732-8181 Prepared by: SCS ENGINEERS, PC 15521 Midlothian Turnpike, Suite 305 Midlothian, Virginia 23113 (804) 378 -7440 November 4, 2016 File No. 02216202.00 Offices Nationwide www.scsengineers.com Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Table of Contents Section Page ExecutiveSummary ........................................................................................................... ...........................ES -1 ProjectObjectives .................................................................................................. ...........................ES -1 EnterpriseFund ............................................................................................ ...........................ES -1 RateModel Scenarios ........................................................................................... ...........................ES -3 ModelResults ............................................................................................... ...........................ES -3 Findings and Recommendations .......................................................................... ...........................ES -4 1.0 Introduction ............................................................................................................... ............................... 1 1.1 Project Scope of Work ................................................................................. ..............................1 1.1.1 Data Collection and Review ............................................................ ..............................1 1.1.2 Staff Communications ........................................................................ ..............................2 1.2 Solid Waste Ordinances .............................................................................. ..............................2 1.2.1 Regulated Recyclable Materials Ordinance ................................ ..............................2 1.3 Collection of Solid Waste and Recyclable Material .............................. ..............................2 1.3.1 County Solid Waste Collection Program ...................................... ..............................3 1.3.1.1 Residential ................................................................... ..............................3 1.3.1.2 Commercial .................................................................. ..............................5 1.3.1.3 Institutional .................................................................. ............................... 5 1.3.2 County Recyclable Material Collection Program ........................ ..............................5 1.3.2.1 Residential ................................................................... ..............................5 1.3.2.2 Commercial .................................................................. ..............................7 1.3.2.3 Institutional .................................................................. ............................... 7 1.3.3 OCR Recyclable Material Processing and Marketing ................ ..............................8 1.4 Solid Waste Programs Fee .......................................................................... ..............................8 1.5 Collected Recyclable Material Tonnage and Revenue .......................... ..............................8 1.6 Solid Waste Disposal ................................................................................... ..............................9 1.7 Household Hazardous Waste and Electronics Recycling .................... ............................... 10 1.8 Food Waste Collection ............................................................................. ............................... 10 1.9 County Solid Waste Management Department Staffing ................... ............................... 11 1.10 Vehicles .......................................................................................................... .............................11 1.11 Public Education and Outreach ............................................................... ............................... 12 2.0 Cost of Service Analysis ........................................................................................ .............................14 2.1 Budget and Management Practices Overview ...................................... .............................14 2.1.1 Enterprise Fund ............................................................................... ............................... 14 2.1.2 Billing ................................................................................................. .............................15 2.1.3 Budget Overview ........................................................................... ............................... 16 2.1.4 Reserves ............................................................................................. .............................18 2.1.5 Rate Model ..................................................................................... ............................... 18 2.1.6 Methodology Overview ............................................................... ............................... 18 2.1.7 Model Scenarios ............................................................................ ............................... 19 2.1.8 Model Results .................................................................................... .............................20 2.1.9 Division Budgetary Leveling .......................................................... .............................20 3.0 Potential Solid Waste Operational Changes .................................................... .............................21 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 3.1 Optimize Collection Center Hours /Days of Operations .................... ............................... 21 3.1.1 Collection Center Use by Month ................................................. ............................... 21 3.1.2 Collection Center Use by Day of Week ................................... ............................... 21 3.1.3 Collection Center Use by Time of Day ...................................... ............................... 22 3.2 Consider a Reduction in Curbside Recyclables Collection Frequency ............................ 23 3.2.1 Other Considerations ...................................................................... .............................23 4.0 Potential Solid Waste Program Financing Alternatives ................................... .............................25 4.1 Collections of Assessed Fee ....................................................................... .............................25 4.2 Modification of Organics Collection Program Funding Structure ....... .............................26 4.3 Major Weather Event /Storm Debris Handling ...................................... .............................26 4.4 Regulated Recyclable Materials Ordinance .......................................... .............................26 5.0 Findings and Recommendations ........................................................................... .............................28 5.1 Revenue Increase Strategies ................................................................... ............................... 28 5.2 Expense Reduction Strategies ................................................................... .............................29 5.3 Rate Benchmarking ...................................................................................... .............................29 6.0 References ................................................................................................................ .............................31 List of Exhibits No. Page Exhibit I. Solid Waste and Recycling Centers by Location and Customer Counts by Fiscal Year................................................................................................................ ............................... 3 Exhibit 2. Solid Waste and Recycling Center Locations ......................................... ............................... 4 Exhibit 3. Solid Waste and Recycling Center Customer Counts by Fiscal Year . ............................... 5 Exhibit 4. 24 -Hour Recycling Drop -off Sites by Location ....................................... ............................... 6 Exhibit 5. 24 -Hour Recycling Drop -off Site Locations ............................................. ............................... 7 Exhibit 6. Recyclable Material Tonnages and Revenue ......................................... ............................... 9 Exhibit 7. Orange County Solid Waste Management Department Website ..... .............................12 Exhibit 8. Orange County Solid Waste Management on Social Media ............ ..............................1 3 Exhibit 9. Revenue Tier Streams and Associated Accounts .................................... .............................15 Exhibit 10. Commissioner Approved Fee Schedule — FY 2015- 16 ........................ .............................16 Exhibit 11. Distribution of Department's Operating Revenues and Expenses by Fiscal Year........ 17 Exhibit 12. Scenario Modeling Results — Projected Fund Budgetary Gap ........... .............................20 Exhibit 13. Recycling Center Customers by Day of Week in FY 2015- 16 ........... .............................22 Exhibit 14. Recycling Center Customers per Hour by Day of Week FY 2015 - 16 ...........................22 Exhibit 15. Recycling Center Customers by Hour of Day in FY 2015- 16 ............. .............................23 Exhibit 16. Average Personnel Direct -Cost per Person ............................................ .............................24 Exhibit 17. Budgeted Solid Waste Management Department Revenue Components as Portions of Total Revenue (FY 2016- 17) ................................................ .............................25 Exhibit 18. Tons Disposed at Orange County C &D Landfill by Year .................... .............................27 Exhibit 19. Comparison of Annual Fees ....................................................................... .............................30 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Appendices A Department Organizational Chart B Department Fleet Asset List C List of Model Assumptions D Estimated Department Revenue Projections E Estimated Department Expense Projections F Financial Model Output Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund EXECUTIVE SUMMARY In March 2016, Orange County, North Carolina (County) retained SCS Engineers (SCS) to conduct a solid waste cost of services and rate study (Study) and to develop a Financial Plan for the County's Solid Waste System (System). Based on data and information provided by County staff, a Pro Forma rate model (Rate Model) was developed, which enabled SCS to prepare projections of financial performance of solid waste and recyclable material collection and disposal for the selected planning period (FY 2016 -17 through FY 2020 -21) and model different possible rate structures. PROJECT OBJECTIVES The overall objective of a cost of service and rate study is to calculate the solid waste fees and assessments required to adequately recover the costs of providing solid waste and recycling services to the County's residents, businesses, and other institutions. Based on its solid waste industry experience, SCS developed a series of critical tasks that provided a foundation for the conduct of the Study and development of the Financial Plan. This methodology is discussed in Section 2 of this report. Enterprise Fund The County has established the Solid Waste Enterprise Fund (Fund) to account for all Solid Waste Management Department (Department) solid waste and recycling program operations, which are financed and operated in a manner similar to private business enterprises. The Fund includes potential revenue from approximately 33 distinct sources (line items under the Budget Accounts), which can be associated with one or more of the four cost centers (Divisions) within the Department. The Fund includes potential expenses from approximately 47 distinct general sources (line items under the Budget Accounts) and five capital sources from five accounts, which can be associated with one or more of the Divisions within the Department. The Solid Waste Program Fee is a single, county -wide fee assessed on each improved property within the County, including the municipalities and the portion of the Town of Chapel Hill located within Durham County. The current fee is $107.00 per parcel annually, but is adjusted annually as part of the Department's budgeting process based on estimated system expenditures, minus all revenue, and divided by the number of taxable parcels. The table below (and also in Section 2.1.3, Exhibit 11) below shows the distribution of the Department's revenues and expenses for the past four fiscal years and the budget for current FY 2016 -17 by division. As shown, annual expenses have increased from the previous to the current fiscal year with the Solid Waste Enterprise Fund running a net deficit each year since FY 2012- 13. The table also shows the amount and percentage of the revenues over the past 4 years that were made up of transfers from the General Fund and Appropriated Fund Balance. The final row of the exhibit shows the additional net revenues and deficits added to the amount transferred from the General Fund. ES -1 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Distribution of Department's Operating Revenues and Expenses by Fiscal Year Notes: 1. Projected past budgetary figures provided by County staff to SCS. 2. Unaudited, preliminary actuals based on discussions with County staff (subject to change). 3. Approved budgetary figures, with Program Fee revenue applied proportional to expenses across Divisions (see leveling factors given in Appendix E). The $2,004,719 in revenue from the General Fund was allocated to the Sanitation Services Division based on historic precedent. 4. This table reflects the resulting restructuring of expense and revenue allocations between the Divisions which occurred as a result of the closure of the Orange County Landfill in FY 2012-13. 5. The Solid Waste Programs Fee was reallocated for distribution from the Recycling Services Division to the Environmental Support Division in FY 2016 -17. ES -2 FY 2012 -13 FY 2013 -14 FY 2014 -15 FY 2015 -161 Projected Budget FY 2015 -162 Preliminary Actuals FY 2016 -173 Revenues by Division ($) Environmental Support 106,047 104,188 770,848 150,000 NA 1,369,717 Landfill Services 3,716,514 1,187,249 1,086,812 1,167,217 NA 1,100,382 Recycling Services 4,732,514 3,512,839 3,803,287 5,531,343 NA 3,925,073 Sanitation Services 2,262,285 3,217,411 4,297,213 4,602,133 NA 3,814,743 Other (Appropriated Fund Bal.) NA NA NA 630,503 NA 1,780,040 Total Department Revenues 10,816,933 8,021,688 9,958,160 12,081,196 10,078,956 11,989,955 Amount that is Transfer from General Fund (Included Above) 1,594,226 1,869,496 1,856,543 1,718,018 1,718,018 2,004,719 Amount that is from Appropriated Fund Balance (Included Above) NA NA NA 630,503 NA 1,780,040 Total Revenue Not Generated by Solid Waste Enterprise Fund 1,594,226 1,869,496 1,856,543 2,348,521 1,718,018 3,784,759 Portion of Revenue Not Generated by Solid Waste Enterprise Fund ( %) 14.7 23.3 18.6 19.4 17.0 31.6 Expenses by Division ($) Environmental Support 2,098,096 2,268,392 2,487,479 2,169,700 NA 2,237,464 Landfill Services 2,218,634 3,032,197 2,347,938 1,410,322 NA 1,117,414 Recycling Services 2,752,628 4,875,031 4,291,804 5,594,727 NA 5,450,893 Sanitation Services 3,289,081 2,302,832 2,570,585 2,906,448 NA 3,184,184 Total Department Expenses 10,358,439 12,478,452 11,697,806 12,081,196 10,790,064 11,989,955 Net Revenues ( +) / Deficits ( -) +458,494 - 4,456,764 - 1,739,646 0 -711,108 0 Notes: 1. Projected past budgetary figures provided by County staff to SCS. 2. Unaudited, preliminary actuals based on discussions with County staff (subject to change). 3. Approved budgetary figures, with Program Fee revenue applied proportional to expenses across Divisions (see leveling factors given in Appendix E). The $2,004,719 in revenue from the General Fund was allocated to the Sanitation Services Division based on historic precedent. 4. This table reflects the resulting restructuring of expense and revenue allocations between the Divisions which occurred as a result of the closure of the Orange County Landfill in FY 2012-13. 5. The Solid Waste Programs Fee was reallocated for distribution from the Recycling Services Division to the Environmental Support Division in FY 2016 -17. ES -2 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund RATE MODEL SCENARIOS SCS developed two Rate Model scenarios to evaluate impacts to the Enterprise Fund financial situation over the 5 -year planning period. Depending on the individual scenario, the Model assesses net revenue needs if the Program Fee, other revenues, and operating costs equal those in the Budget for FY 2016 -17 with inflation factors applied, known capital items accounted for, and other adjustments made to specific line items as detailed in Appendix C: • Scenario 1 — Scenario 1 assumes status quo for the Department Solid Waste Program Fee ($107 per year). This scenario is intended to be used as a baseline or "Status Quo" scenario to enable comparison with Scenario 2. Scenario 2 — This scenario serves as an assessment of the required increase in the Program Fee to balance projected operating expenses and revenues for solid waste and recycling services. Scenario 2 assumes the Program Fee balances the Fund's annual budget if other revenues and operating costs equal those projected in the Budget for FY 2016 -17, dependent on the sub - scenario. This iteration serves as a "break- even" analysis. Model Results The table below (and also in Section 2.1.8, Exhibit 12) shows the Modeled Budgetary Gap for Scenario 1 and the break -even Program Fees for Scenario 2 for FY 2016 -17 to FY 2020 -21. Note that the Program Fee was back - calculated using an optimization algorithm. Complete financial model results highlighting the Fund's projected annual net revenue /deficits are presented in Appendix F. Scenario Modeling Results Scenario FY 2016 -17 FY 2017 -18 FY 2018 -19 FY 2019 -20 FY 2020 -21 1 — Status Quo Budgetary Gap with $107 Program ($1,780,040) ($2,015,497) ($2,064,603) ($2,345,290) ($2,593,011) Fee 2 — Break Even Program Fee with $0 Budgetary $137 $140 $141 $145 $148 Gap Note: Negative values indicate a projected gap. ES -3 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund FINDINGS AND RECOMMENDATIONS Our findings and recommendations, including revenue increase strategies, expense reduction strategies, and rate benchmarking from the Study are presented in Section 5 and summarized below. SCS offers the following findings and recommendations for the County's consideration: • As outlined in Scenario 1, the Fund's current financial structure is unsustainable and maintaining the current Program Fee amount ($107) along with the Status Quo program services will yield significant annual deficits over the next 5 -year period, even with the current practice of General Fund contributions. • The exercise of allocating monies from the Fund's balance ( "Reserves ") to cover the annual budget deficit each year will deplete the entire Fund balance in approximately 5 years at the current rate of spending. • The Pro Forma Rate Model developed as part of this cost of service study should be updated annually and used for long -term financial forecasting of the Fund and to evaluate the likely impact of proposed Department operational changes. • Based on a cursory review of the program, SCS did not identify any notable inefficiencies within the Department operations. SCS recommends the County conduct a more in -depth review of its program on a routine basis to identify opportunities for revenue increase and expense reduction. ES -4 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 1.0 INTRODUCTION In March 2016, Orange County, North Carolina (County) retained SCS Engineers (SCS) to conduct a solid waste cost of services and rate study (Study) and to develop a Financial Plan for the County's Solid Waste System. Based on data and information provided by County staff, a Pro Forma rate model (Rate Model) was developed, which enabled SCS to prepare projections of financial performance of solid waste and recyclable material collection and disposal for the selected planning period (FY 2016 -17 through FY 2020 -21). Orange County Solid Waste Management Department (Department) solid waste and recycling program operations are organized under the following cost centers, or Divisions: • Environmental Support Services • Landfill Services • Recycling Services • Sanitation Services The Environmental Support Services Division consists of various Department support elements including planning and administrative functions, utilities, maintenance, education and outreach, and enforcement. The Landfill Services Division is responsible for the operation of the construction and demolition (C &D) landfill, scales and weighing, incoming waste materials inspections, maintenance and monitoring of the three closed landfills, oversight of temporary storm debris management sites, and general Eubanks Road site grounds maintenance and security. The Recycling Services Division manages a variety of recycling programs, services, and facilities. Finally, the Sanitation Services Division is responsible for Waste and Recycling Center operations, collection of waste from County buildings and schools, and the collection of bulky waste items. 1.1 PROJECT SCOPE OF WORK The overall objective of a cost of service and rate study is to calculate the solid waste fees and assessments required to adequately recover the costs of providing solid waste and recycling services to the County's residents, businesses, and other institutions. Based on its solid waste industry experience, SCS developed a series of critical tasks that provided a foundation for the conduct of the Study and development of the Financial Plan. This methodology is discussed in Section 2 of this report. 1.1 .1 Data Collection and Review The County provided historical and background information on operations and practices. This included: • Detailed financial reports and budgets • Solid waste and financial policies • Historical waste and recyclable material flow • Personnel rosters and organizational charts Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund • Vehicle improvement plans • Vehicle maintenance plans and anticipated costs • Solid waste agreements • Planned and potential capital improvement projects • Program fee drivers, memorandums, and other narratives 1.1.2 Staff Communications SCS held a project kickoff teleconference to initiate the Study, which provided a forum to confirm the scope of services, discuss data needs, and identify key issues for County staff. During the course of the Study, SCS conducted a series of additional conference calls with County staff managing different facets of the overall System. These conference calls, along with routine email communications, gave SCS an opportunity to review Study progress, verify overall assumptions, and receive useful input from County staff. In addition, SCS representatives gave a presentation of initial Study findings at a County Manager's Meeting on 5/10/16 as well as a meeting of the Solid Waste Advisory Group (SWAG), a group of public and private solid waste stakeholders from various County and Town organizations on 5/25/16. SCS met with the County Manager and other County leaders again on 8/3/16 to review the financial analysis and conclusions and recommendations from the study. 1.2 SOLID WASTE ORDINANCES Chapter 34 of the County Code contains the County's solid waste ordinances. Ordinances fall under three articles related to general solid waste topics, collection and disposal, and regulated recyclable material. 1.2.1 Regulated Recyclable Materials Ordinance Of particular note is the Regulated Recyclable Materials Ordinance (RRMO), which went into effect on October 1, 2002. The RRMO requires that C &D projects have a waste management plan in place. It also mandates that certain bulky materials such as scrap metals, clean wood, pallets, and corrugated cardboard from commercial waste streams be recycled and not disposed of in a landfill. Applications for self -haul of recyclable material are available through the Department for a fee. There is also a charge of $25 per vehicle for a Collector's License which is applied to a vehicle used to haul C &D waste within the County with a Gross Vehicle Weight of greater than 9,000 pounds. Open burning of solid waste and C &D is prohibited within the County. 1.3 COLLECTION OF SOLID WASTE AND RECYCLABLE Collection of solid waste and traditional recyclable material (bottles /cans, mixed paper, OCC, etc.) occurs through a variety of facets (curbside collection, staffed drop -off centers, 24 -hour drop -off centers, etc.) within Orange County. Orange County is somewhat unique in the municipal world in that it operates municipal curbside recyclable material collection programs but not curbside solid waste collection. Communities in the United States tend to rely on private, Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund solid waste haulers to provide both of these collection services for their citizens. Many urban, metropolitan municipal solid waste departments continue to provide collection services using municipal employees. Nationally, a large majority of the remaining solid waste programs have transitioned to contracted private haulers, primarily as a cost and risk reduction opportunity. 1.3.1 County Solid Waste Collection Program The County provides solid waste collection services to its residents through drop -off collection facilities and governmental institutions via direct collection. Commercial solid waste collection is provided through private enterprise within Orange County. 1.3.1.1 Residential The Department does not provide curbside solid waste collection. Solid waste collection services are provided to County residents at the five drop -off Solid Waste and Recycling Centers located throughout Orange County (refer to Exhibit 1 and Exhibit 2). Municipal Solid Waste (MSW), scrap tires, white goods, scrap metal, clean wood waste, yard waste, and bulky waste is handled by the Sanitation Services Division at these sites. Exhibit 1. Solid Waste and Recycling Centers by Location and Customer Counts by Fiscal Year Center Letter Address FY 2011 -12 FY 2012 -13 FY 2013 -14 FY 2014 -15 FY 2015 -16 1514 Eubanks Rd, Eubanks A Chapel Hill, NC 154,760 158,637 161,128 126,405 121,467 27516 1616 Ferguson Rd, Ferguson B Chapel Hill, NC 94,535 88,535 89,867 71,200 72,151 27516 6705 Bradshaw Quarry Rd, Bradshaw C Mebane, NC 35,376 38,265 40,825 37,888 39,113 27302 7001 High Rock High Rock D Rd, Efland, NC 68,582 79,289 70,992 68,102 66,747 27243 3605 Walnut Walnut Grove Church Rd, Grove E Hillsborough, NC 154,238 117,743 133,054 142,485 134,829 27278 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 2. Solid Waste and Recycling Center Locations Note that the Walnut Grove Church Road Center was modernized into a "District Center" in 2013 via paving as well as the installation of compactors, dual loading heights, household hazardous waste (HHW) collection, clothing drop off, plastic bag recycling, and food waste collection containers. Additional Solid Waste and Recycling Centers are being considered for future modernization, including the Eubanks Road Center which is slated for reconstruction into a District Center. The Department collects data on Solid Waste and Recycling Center customer attendance through continuous customer counts. The customer counts are shown in tabular format in Exhibit 1 and in graphical format in Exhibit 3. 4 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 3. Solid Waste and Recycling Center Customer Counts by Fiscal Year 0 u L v E 0 V, 3 v 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 FY 11 -12 FT 12 -13 FY 13 -14 FY 14 -15 FY 15 -16 1.3.1.2 Commercial 520,000 500,000 n _ 480,000 0 -----Bradshaw fD CD — &—Eubanks 460,000 a = 0 Ferguson 440,000 c --X—High Rock 420,000 21- --*—Walnut Grove 0 400,000 }Total 380,000 The County does not provide solid waste collection services for its commercial establishments. Commercial waste from businesses and multi - family residences (e.g., apartments and condominiums) is collected by a combination of national and regional private companies and billed directly to customers by these companies. 1.3.1.3 Institutional Solid waste collection services are provided to County buildings by the County's Sanitation Services Division. The Division also collects waste from the Orange County schools and bulky waste from both the Orange County schools and Chapel Hill - Carrboro City schools for a fee. These contracts with the school systems account for a portion of the revenue into the Solid Waste System. 1.3.2 County Recyclable Material Collection Program Recycling services are currently administered within the County by Orange County Recycling (OCR), a division of the Department. In 1997, Orange County and the incorporated municipalities of Chapel Hill, Carrboro, and Hillsborough each adopted a solid waste reduction goal of 61 % per capita. The efforts of OCR have resulted in one of the top solid waste reduction rates in the state of North Carolina. 1.3.2.1 Residential Orange County's first recycling program commenced in 1987 with the construction of five unstaffed drop -off sites which accepted glass bottles, aluminum cans, and newspapers. Since that time, recycling has expanded in the County to include additional recyclable material collection at the Solid Waste and Recycling Centers and curbside collection in both urban and rural areas. Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Urban curbside collection began within the County in the Towns of Chapel Hill, Carrboro, and Hillsborough by a private contractor in 1988. Weekly urban curbside recyclables collection is now provided by OCR via a contracted private hauler in the three towns and the portion of Chapel Hill located in Durham County. Residential curbside service began in select rural areas of Orange County in 1993, and in 2015 the Department commissioned a collection route optimization study which also assessed the feasibility of implementing curbside recyclables collection in rural households which were not previously offered the service. The study concluded that the new households could be incorporated in a single phase and in 2016 the remaining 6,800 rural households which previously did not receive curbside recyclables collection service were added to the rural curbside program. All County residents may drop off recyclable materials at the five Solid Waste and Recycling Centers located throughout the County or the five 24 -Hour Recycling Drop -off Sites as shown in Exhibit 4 and Exhibit 5. Exhibit 4. 24 -Hour Recycling Drop -off Sites by Location Center No. Address Cedar Falls Park 1 401 Weaver Dairy Road, Chapel Hill, NC 27516 University Mall 2 201 Estes Drive, Chapel Hill, NC 27514 Meadowmont 3 Hwy 54 East (behind Harris Teeter), Chapel Hill, NC 27517 Carrboro Plaza 4 104 NC 54, Carrboro, NC 27510 Hampton Pointe 5 625 Hampton Point Blvd, Hillsborough, NC 27278 M Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 5. 24 -Hour Recycling Drop -off Site Locations 1.3.2.2 Commercial Orange County took over commercial recyclables collection from a private contractor in 2000. County commercial recycling services are provided at no direct cost to participating businesses at select commercial recycling locations. The County provides carts and collection services to the participating businesses. Commercial establishments may also drop off old corrugated cardboard (OCC) for no charge at the five 24 -Hour Recycling Drop -off Sites if they produce fewer than 50 boxes per week or at the Landfill where there is no limit. County commercial establishments may also contract with private contractors for recyclable material collection. Orange County provides technical assistance to local businesses and other non - residential entities on request at no charge. 1.3.2.3 Institutional Recyclable material collection services are provided by OCR to local, state, and government buildings; pedestrian containers located in area parks and downtown Chapel Hill, Carrboro, and Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Hillsborough; convenience stores; and gas stations. OCR also collects recyclable material twice weekly from the Orange County schools (a service started in 2010) and Chapel Hill - Carrboro City schools (2011) for a fee. Contracts with the school systems and other municipal sources account for a portion of the revenue into the Solid Waste System. 1.3.3 OCR Recyclable Material Processing and Marketing All collected recyclable material is consolidated at the recycling area of the Orange County Landfill. The recycling area consists of a large concrete pad (about 15,000 square feet) that is partially covered upon which collected recyclables are dumped from the collection vehicles. Waste Industries, the private hauler contracted to collect recyclable material curbside from urban residences, delivers the recyclables to the recycling area at the Landfill. Prior to June 2012 a two- stream program strategy was employed in which fiber was transferred and sold to Sonoco in Durham, whereas commingled cans and bottles were transferred and sold to FCR/ReCommunity in Greensboro. Beginning in July 2012, the material has been delivered to the recycling area as a single- stream, inspected by County staff for contaminants, and loaded into walking floor trailers and transported to the Sonoco MRF in Raleigh where it is processed and sold. Electronics are transported to GEEP in Durham, NC, and rigid plastics are transported to Blueridge Plastics in Eden, NC; Sonoco in Raleigh, NC; or other plastics recyclers in the region depending on market value at the time of discard. There is one (1) County employee that manages the quality control and loading of single stream material. Two (2) County employees transport single stream and rigid plastic to their respective destinations. The electronics recycling vendor currently collects the County - prepared electronic recycling material at the landfill property and transports the material to their property for further processing and sale to end users. 1.4 SOLID WASTE PROGRAMS FEE The County charges all eligible properties an annual fee of $107.00 for the solid waste and recycling program services provided by the Department. This Solid Waste Program Fee is charged to cover the costs of collecting, handling, and disposing and/or recycling of the County's solid waste and recyclable material. The fee, which was implemented in 2015, is included with the annual tax bill levied on approximately 61,000 improved properties within the County. As noted in Section 1.1, one of the purposes of this Study is to estimate the appropriate Fee amount over the 5 -year planning period to cover the costs of the County's solid waste and recycling programs. A 3 -R fee and Waste and Recycling Center fee were implemented as user fees, both of which have since been replaced by the Solid Waste Programs Fee. 1.5 COLLECTED RECYCLABLE MATERIAL TONNAGE AND REVENUE Exhibit 6 shows the last five fiscal years of recyclable material weight data and revenue. The data shows that recycling revenues in the County have been decreasing despite increased collection of recyclable material. This is primarily due to a decrease in the strength of the commodities market. Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 6. Recyclable Material Tonnages and Revenue 16,000 15,500 15,000 a 14,500 u d = 14,000 0 13,500 13,000 12,500 1.6 FY 2010 -11 FY 2011 -12 FY 2012 -13 FY 2013 -14 FY 2014 -15 Fiscal Year - Tons $ Revenue Source: Orange County, 2015 -16 SOLID WASTE DISPOSAL $900,000 $800,000 $700,000 $600,000 $500,000 M ao $400,000 CD CD $300,000 r $200,000 $100,000 $0 Municipal solid waste collected from the Solid Waste and Recycling Centers and County institutions is delivered to the City of Durham Transfer Station where the Department is charged $42.50 per ton. Yard waste is delivered by residents and the area Towns to the Landfill where it is mulched and sold to the community. The County owns and operates a Construction and Demolition (C &D) Landfill at 1514 Eubanks Road. It is located at the site of the old Orange County MSW Landfill (Landfill) which closed on July 1, 2013, and two other co- located landfills (one C &D unit and one MSW unit). C &D debris, stumps, land clearing waste, mobile homes, mattresses/box springs (currently transported to Purpose Recycling), yard waste, clean wood waste, and stockpiled tires are accepted at the landfill and on -site collection center for various fees. Old corrugated cardboard (OCC), oyster shells, electronics, residential /commercial tires, large appliances, and scrap metal are accepted from residents for free. Department staff strictly enforces the Regulated Recyclable Materials Ordinance at the C &D Landfill. Contaminated loads (loads containing both recyclable and non - recyclable C &D waste) brought to the C &D Landfill will be charged double the tipping fee of uncontaminated loads. Alternatively, the Department staff requires sorting of recyclable materials from contaminated loads upon arrival at the C &D landfill. 0 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 1.7 HOUSEHOLD HAZARDOUS WASTE AND ELECTRONICS RECYCLING The Recycling Services Division operates Toxicity Reduction Improvement Programs (TRIP) to collect County residents' household hazardous waste (HHW) and electronics for disposal and /or recycling. Materials accepted at the five Solid Waste and Recycling Centers include: • Electronics • Automotive and Boat Batteries • Household Batteries • Oil Filters • Motor Oil • Kerosene, transmission fluid, gear oil, heating oil, Coleman fuel, and diesel fuel • Antifreeze The Walnut Grove Church Road Solid Waste and Recycling Center accepts HHW items not accepted at other Solid Waste and Recycling Centers. In addition to the Walnut Grove Center, Orange County operates a HHW collection center on the Eubanks Road Landfill, soon to be incorporated into the Eubanks Road Waste and Recycling Center to allow for extended hours of operation. Materials accepted only at the HHW Collection Center and Walnut Grove Church Center include the following: cooking oil; lawn, garden, and pool chemicals; household cleaners and chemicals; paint, sealant, and solvents; partially - filled aerosol cans; automotive chemicals; automotive fluids such as gasoline, mixed gas, and brake fluid; fluorescent light bulbs, including tubes and compact fluorescent lightbulbs (CFLs); thermostats and thermometers containing mercury; helium tanks (up to 3- gallons); and propane tanks (1 gallon). Commercial entities may also drop off their HHW if they produce less than 220 pounds per month at the Eubanks Road HHW Collection Center. Many painting contractors use this facility. Businesses with more than 75 pounds of HHW must set up an appointment prior to arriving at the collection center. 1.8 FOOD WASTE COLLECTION According to a 2013 survey in the United States, there are more than 214 source - separated organics collection programs in operation and the effort to separately manage waste organics is gaining traction in recent years. That number is up from only 20 programs in 2005. Consequently, Orange County can be considered as an "early adopter." The County contracts with a private hauler (currently Brooks Contracting of Gladstone, NC) to collect and compost food waste and other compostable organic material from select local businesses at no charge. This program accepts source- separated organic materials such as kitchen and produce department prep waste, post- consumer plate waste, and other compostable organic materials from local restaurants, grocery stores, and food service establishments for composting. Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Residents may also drop -off their source - separated food waste into separate containers designated for composting at the Walnut Grove Church Road Solid Waste and Recycling Center. This is currently the only waste and recycling center that accepts residential food waste for composting, although wood waste composting will be incorporated into the Eubanks Road Waste and Recycling Center upon its completion. Orange County Solid Waste also sells compost bins for $50.00 apiece at the administration building on Eubanks road. The compost produced by Brooks meets the Class "A" rating by the State of North Carolina, the highest regulatory ranking available for compost. The product is suitable for unrestricted use on agricultural crops, landscaping plants, turf, or ornamentals. It is sold at a cost of $30.00 per yard to residents. The County also maintains two outdoor composting demonstration sites for educational purposes, and instructional classes are held at the sites at least four times per year. Orange County Solid Waste can also help set up or teach composting programs for interested organizations. These programs are free to Orange County residents and businesses. 1.9 COUNTY SOLID WASTE MANAGEMENT DEPARTMENT STAFFING The Department is responsible for the overall management of the County's solid waste program. It is currently staffed with approximately 64 total positions. As shown in Appendix A, from a personnel standpoint, the Department is subdivided into three sections (note this breakdown differs from the breakdown of administrative Divisions within the department): • Environmental Support • Solid Waste Operations • Recycling Operations Mr. Gayle Wilson serves as the Solid Waste Management Director. Additional managerial positions within the Department include Solid Waste Planner, Administrative Officer, Management and Program Specialist, Solid Waste Operations Manager, Solid Waste Engineer, Heavy Equipment Mechanic Supervisor, Solid Waste Collection Services Manager, Environmental Enforcement Supervisor, Recycling Programs Manager, Recycling Programs Supervisor, and Solid Waste Field Services Supervisor. 1.10 VEHICLES The Department and its contractors provide collection services to residences and businesses within the County using a combination of trucks for recyclables, residential solid waste (from collection centers), institutional solid waste, yard waste, food waste, and bulky waste. The Department has a long -term fleet replacement plan. Appendix B lists the current Department fleet inventory by division. The Department maintains a vehicle fleet separate from the main County fleet in regards to acquisition, maintenance, and utilization, the only department within the County government infrastructure to do so. A Fleet Management Review was conducted by Chatham Consulting, Inc., in 2012 which offered observations and recommendations to increase the efficiency of the operations of the Department fleet. Chatham observed that fleet operations are "Safe & Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Economic" and that fleet vehicles are well maintained. The Department is preparing to commence an additional fleet study with CST Fleet Services to benchmark repair efforts and maintenance scheduling. 1.1 1 PUBLIC EDUCATION AND OUTREACH The Department deploys a comprehensive environmental education and outreach services program, which provides information to the public on the range of services the Department provides, associated costs, and efficiency measures implemented. The Department's efforts includes providing classes, community talks, brochures, a Department web site (Exhibit 7), social media (Exhibit 8), and support of volunteer cleanup efforts. Exhibit 7. Orange County Solid Waste Management Department Website ,i �,t• . ORANGE COUNTY Search. NORTH CAROLINA Bane � devar4ne ..akd Warte Mmiap nt Solid Waste Management Department The. 0,-9e. C—nty :ReAd ww'. Manageieiani peparinxat ix rrspnnnhle Iw uperatrny the Oraruye C.-rIty I.and11l, Orange Grn.nty SM" Waste Ccn+.enlenee C ntar8 and Orange Cominrinitr Reryrkng pr j—s. ILLJJ1 , for yha ]pls deparlrneni.i h.hd,1y - hndule. Q,k hefe for a WA— nl Orange C. —ty's R.:y hny prugrem f.kk he, far iMartnatlnn regarding the sobd Write ndvlwry Geaup ._ ::.r rnoMnly r"4r'Seryl Th? ^!SSRilye QVISe (Ip Wn and conta(t Intonn on) serves tlfe lda0 ng func Ons! + Iandem accounts • sou Wpate. pray — rapndanlrllatr.ZWn [. 5 +n •nld 9n � for R. !f 5 .ntl k •'v lino 'rtes • eoucaw and gutreactl + hnannna anrj budhcl- . tra,W g program performance [str]rls!ssP 12 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 8. Orange County Solid Waste Management on Social Media L SOLID WASTE MANAGEMENT COUNTY - • - -'�I Timeline About Photos Reviews More - c�t ® Orange County NC Solid Waste Management <.pnl i- _ - - - 103 people likethis Everwondered whattodo with your plastic bags? Find out here! #recycle #reuse #plasticbags a people have been here ht[psllorange OUntyncsol[dwaSte_tUmb[LCOmf_ Ar- you- Iread -o... Open S:DOAM -5 0OPM What to d0 with those desk' plastic Get additional info lags I'm aplaarde Ityou read our most recent post you knowthetwe Invite trends to like this Page bag, bnf yoo touched on the impodance of NOT putting plastic Can always bags in your recycling bin .I knowyou must be... PBBa6 W ®1 ® 5.0 015 stars - 1 review OP,gr,GECAUfYTi NLSOL0W'HSTE.TUMBLROON Oe,u Reviews AMU } i+ Like ■Comment A Share 03 9 ii Wnte a comment.. ® Orange County NC Solid Waste Management 1207 Eubanks Rd 9 save April r'. al I1:!.9am M Chapel Hill, NC Ever wonderetl how your recyclabfes get recycletl7 Here's a first peek into _ (91 91 9 66 -2786 mo.�,.�in�,.r,.ra��Nr�..�m 13 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 2.0 COST OF SERVICE ANALYSIS Since the cessation of waste acceptance at the County's sanitary landfill in June 2013, the expenses associated with the County's existing solid waste management and recycling programs and facilities have exceeded the revenues generated by these programs and facilities. SCS reviewed historical program and facilities expenses (both operating and capital) as well as the historical revenues from various sources that have served to cover these expenses for the past several years. SCS projected the costs necessary to continue implementing these programs and operate existing facilities over the next 5 years (through FY 2020 -21). SCS also projected the revenues likely to be realized during this timeframe in order to develop a "cost -of- service" analysis to identify potential funding deficits or surpluses. A brief overview of the Department's current budget and management practices, along with a description of SCS' assumptions and findings related to this cost -of- service analysis are discussed below. 2.1 BUDGET AND MANAGEMENT PRACTICES OVERVIEW 2.1.1 Enterprise Fund The County has established the Solid Waste Enterprise Fund (Fund) to account for all Department solid waste and recycling program operations, which are financed and operated in a manner similar to private business enterprises. In other words, the County's intent is that the Fund be managed such that the costs of implementing these programs and facilities (operating and capital expenses, including depreciation) are covered by the monies in this Fund. Money is allocated to this Fund through user charges and revenues generated by the solid waste and recycling programs and facilities supported by the Fund, with limited revenue allocated from the General Fund. The Fund includes potential revenue from approximately 33 distinct sources (line items under the Budget Accounts), which can be associated with one or more of the four cost centers (Divisions) within the Department. Most of these sources contribute revenue into only one of the Divisions. However, line items for some sources contribute revenue into multiple Divisions. For general reference purposes, SCS divided revenue sources into three categories or tiers of sources; primary, secondary, and ancillary. Exhibit 9 displays the three tiers and core revenue streams associated with each. 14 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 9. Revenue Tier Streams and Associated Accounts Tier Definition Example Revenue Accounts Primary' Greater than $1 Million per County Solid Waste Program Fee, County General year Fund Contribution, Appropriated Fund Balance Secondary Greater than $100K per Contribution from Equipment Reserves, Landfill year but less than $1 Fees, Recycling Tip Fees, Sanitation Waste Million Collections, Tire Tax Reimbursement, Sale of Recyclable Material, C &D License /Permit Ancillary Less than $100K per year Sale of Fixed Assets, White Goods Reimbursement, Clean Metal and White Goods Recycling, Mulch Sales, Grants, LFG Recovery, Disposal Tax Reimbursement, Compost Sales, Mattress Disposal Fees, etc. Note: 1 . The Appropriated Fund Balance has historically been an Ancillary or Secondary Tier line item account; however, the FY 2016 -17 Preliminary Budget relies on this line item account as a Primary Tier. The Fund includes potential expenses from approximately 47 distinct general sources (line items under the Budget Accounts) and five capital sources from five accounts, which can be associated with one or more of the Divisions within the Department. The four largest contributors to expenses are Permanent Salaries (22 %), Miscellaneous Contract Services (13.8 %), Contribution to Equipment Reserves (11.1 %), and Vehicles (6.6 %). Historically, the County General Fund has contributed to the Enterprise Fund budget, accounting for roughly 65 percent of the Sanitation Division budget following its transfer from the Public Works Department to the Solid Waste Management Department in FY 2007 -08. The reduction of Enterprise Fund revenue over the past three years or so is attributed to the closure of the MSW Landfill and the decline of recyclable material prices in the commodities market. 2.1.2 Billing The Solid Waste Program Fee is a single, county -wide fee assessed on each improved property within the County, including the municipalities and the portion of the Town of Chapel Hill located within Durham County. The current fee is $107.00 per parcel annually, but is adjusted annually as part of the Department's budgeting process based on estimated system expenditures, minus all revenue, and divided by the number of taxable parcels. A collaborative discussion by the Board of County Commissioners (BOCC) follows this exercise, at which time budgets are finalized. The Tax Administration Department manages billing and collection of tax payments for the County, including billing and collection of the Programs Fee. This service incurs charges by the General Fund to the Solid Waste Enterprise Fund. The C &D Landfill accepts certain types of waste from commercial and residential customers for various fees depending on the material. A schedule of fees for various materials as well as other Program fees can be found in Exhibit 10. These charges are incurred by the customer upon disposal. 15 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 10. Commissioner Approved Fee Schedule — FY 201 5 -1 6 Department/ Pro ram Destination Current Fee Approved Fee Change* Last Revesion Solid Waste Enterprise Fund Solid Waste Programs Fee (30) NA $107.00 New Landfill 2013 Construction & Demo $40.00 /ton 2012 Clean Wood /Vegetative Waste $1 8.00 /ton 2009 Stumps & Land Clearing Waste $40.00 /ton 2012 Disposal of Mobile Homes $200.00 /unit 2010 Conventional Yard Waste Mulch $25.00/3 cubic yard 2012 Decorative Red Mulch & $28 /one cubic yard scoop 2009 Tires (stockpiled tires /no state $1 00.00 /ton 1997 Appliances (White Goods) No charge Scrap Metal No charge Cardboard No charge IMattress Recycling Fee $10 per piece 2013 Environmental Support Regulated Recyclable Materials $25.00 /vehicle 2002 Regulated Recyclable Materials $250.00 /application 2002 Regulated Recyclable Materials 10% of assessed building 2002 Regulated Material Permit - 8% of Applicable Building 2008 Regulated Material Permit - 5% of Applicable Building 2008 Sanitation - School Refuse Collection 6 cubic yard $31.00 2010 8 cubic yard $33.00 2010 Non - scheduled pick -up $40.00 2010 Community Relations /Visitors Bureau Occupancy Tax Rate 3% of gross receipts 2008 Note: *Any fee changes will be included in this column; a blank beside each fee means there is no fee change in FY 2015 -16. 2.1 .3 Budget Overview Exhibit 11 shows the distribution of the Department's revenues and expenses for the past four fiscal years and the budget for current FY 2016 -17 by division. As shown, annual expenses have increased from the previous to the current fiscal year with the Solid Waste Enterprise Fund running a net deficit each year since FY 2012 -13. The exhibit also shows the amount and percentage of the revenues over the past 4 years that were made up of transfers from the General Fund and Appropriated Fund Balance. The final row of the exhibit shows the additional net revenues and deficits added to the amount transferred from the General Fund. Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 1 1 . Distribution of Department's Operating Revenues and Expenses by Fiscal Year Notes: 1. Projected past budgetary figures provided by County staff to SCS. 2. Unaudited, preliminary actuals based on discussions with County staff (subject to change). 3. Approved budgetary figures, with Program Fee revenue applied proportional to expenses across Divisions (see leveling factors given in Appendix E). The $2,004,719 in revenue from the General Fund was allocated to the Sanitation Services Division based on historic precedent. 4. This table reflects the resulting restructuring of expense and revenue allocations between the Divisions which occurred as a result of the closure of the Orange County Landfill in FY 2012-13. 5. The Solid Waste Programs Fee was reallocated for distribution from the Recycling Services Division to the Environmental Support Division in FY 2016 -17. 17 FY 2012 -13 FY 2013 -14 FY 2014 -15 FY 2015 -161 Projected Budget FY 2015 -162 Preliminary Actuals FY 2016 -173 Revenues by Division ($) Environmental Support 106,047 104,188 770,848 150,000 NA 1,369,717 Landfill Services 3,716,514 1,187,249 1,086,812 1,167,217 NA 1,100,382 Recycling Services 4,732,514 3,512,839 3,803,287 5,531,343 NA 3,925,073 Sanitation Services 2,262,285 3,217,411 4,297,213 4,602,133 NA 3,814,743 Other (Appropriated Fund Bal.) NA NA NA 630,503 NA 1,780,040 Total Department Revenues 10,816,933 8,021,688 9,958,160 12,081,196 10,078,956 11,989,955 Amount that is Transfer from General Fund (Included Above) 1,594,226 1,869,496 1,856,543 1,718,018 1,718,018 2,004,719 Amount that is from Appropriated Fund Balance (Included Above) NA NA NA 630,503 NA 1,780,040 Total Revenue Not Generated by Solid Waste Enterprise Fund 1,594,226 1,869,496 1,856,543 2,348,521 1,718,018 3,784,759 Portion of Revenue Not Generated by Solid Waste Enterprise Fund ( %) 14.7 23.3 18.6 19.4 17.0 31.6 Expenses by Division ($) Environmental Support 2,098,096 2,268,392 2,487,479 2,169,700 NA 2,237,464 Landfill Services 2,218,634 3,032,197 2,347,938 1,410,322 NA 1,117,414 Recycling Services 2,752,628 4,875,031 4,291,804 5,594,727 NA 5,450,893 Sanitation Services 3,289,081 2,302,832 2,570,585 2,906,448 NA 3,184,184 Total Department Expenses 10,358,439 12,478,452 11,697,806 12,081,196 10,790,064 11,989,955 Net Revenues ( +) / Deficits ( -) +458,494 - 4,456,764 - 1,739,646 0 -711,108 0 Notes: 1. Projected past budgetary figures provided by County staff to SCS. 2. Unaudited, preliminary actuals based on discussions with County staff (subject to change). 3. Approved budgetary figures, with Program Fee revenue applied proportional to expenses across Divisions (see leveling factors given in Appendix E). The $2,004,719 in revenue from the General Fund was allocated to the Sanitation Services Division based on historic precedent. 4. This table reflects the resulting restructuring of expense and revenue allocations between the Divisions which occurred as a result of the closure of the Orange County Landfill in FY 2012-13. 5. The Solid Waste Programs Fee was reallocated for distribution from the Recycling Services Division to the Environmental Support Division in FY 2016 -17. 17 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 2.1.4 Reserves The unaudited ending balance for the Solid Waste Enterprise Fund is forecasted at $8,867,042 on June 30, 2016. This balance includes long -term commitments and $3,492,631 of Equipment Reserves balance. This amount represents the ending Fund balance without loan proceeds including those from building construction, rural expansion cart procurement, a rural truck purchase, Eubanks Road W &R Center loan, balance from closure of the Orange County Landfill, and another prior loan. The total estimated Fund balance is $12,751,990 when these additional loan proceeds are accounted for. Use of Fund balance has been required in order to balance the Department budget over the past several fiscal years including the current FY 2016 -17. The goal of the Department is to enable the Fund to be structurally viable and sustainable without contributions from the General Fund or allocations from the Fund balance. 2.1.5 Rate Model At the outset of the work effort, SCS developed a Microsoft Exce1TM spreadsheet- based, pro - forma model (Rate Model) to assist in the completion of the financial analysis. This model includes the following facets: • An analysis of operational expenditures (facility operation, staffing, recycling tonnages, tipping fees, etc.); refer to Appendix E for 5 -year estimated Department expense projections. • Analysis of capital outlays (equipment replacement and capital projects). • Revenue analysis (annual revenue projections, net expenditures, and rate plan to provide sufficient revenues); refer to Appendix D for 5 -year estimated Department revenue projections. • Rate Benchmarking Analysis. 2.1.6 Methodology Overview The following methods were utilized by SCS to conduct the cost of service analysis: • Collect Historical Actual Expenses and Revenues for the County System — This task involved gathering available historical actual revenue and expense data for the Fund, compiling these into a financial database, and incorporating the data into the Rate Model. • Develop the "Test Year" — The second task was the development of an annual revenue requirement for a "Test Year ". The revenue requirement represents the total revenue for the System needed to recover all System costs. SCS worked with County staff to select a period that reflected a typical year for the System. Budgetary expenses for FY 2016 -17 were used as the basis of the Test Year for the Study. SCS then worked with County staff to make these costs more representative of anticipated conditions during the upcoming 5 -year financial planning horizon. The resulting Test 18 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Year was used as the basis for forecasting expenses for the 5 -year forecast (FY 2016- 17 to FY 2020 -21). • Develop Revenue Requirement Projection — After developing the revenue requirement for the Test Year, SCS worked with County staff to project changes in anticipated costs due to inflation, labor increases, facility and vehicle maintenance, planning costs, etc. This resulted in a 5 -year revenue requirement forecast for the entire sanitation program including collection, recycling, disposal of solid waste, public education, etc. • Revenue Offsets — SCS worked with County staff to identify revenue sources and develop estimates for the sale of recyclables, C &D permit revenues, C &D tipping fees, mulch and compost sales, LFG recovery, etc. • Determination of the Number of Customer Units — SCS worked with County staff to develop reasonable estimates of future number of customers over the next 5 -year period. • Calculation of the Annual County Solid Waste Programs Assessed Fee — SCS distributed the revenue needs across the four Divisions to estimate the cost of service and calculate the annual Program Fee needed to balance the budget. Appendices D and E identify projected revenues and expenses, respectively, by service area used in the Model for the Department for FY 2016 -17 through FY 2020 -21. 2.1.7 Model Scenarios SCS developed two Rate Model scenarios to evaluate impacts to the Enterprise Fund financial situation over the 5 -year planning period. Depending on the individual scenario, the Model assesses net revenue needs if the Program Fee, other revenues, and operating costs equal those in the Budget for FY 2016 -17 with inflation factors applied, known capital items accounted for, and other adjustments made to specific line items as detailed in Appendix C: • Scenario 1 — Scenario 1 assumes status quo for the Department Solid Waste Program Fee ($107 per year). This scenario is intended to be used as a baseline or "Status Quo" scenario to enable comparison with Scenario 2. • Scenario 2 — This scenario serves as an assessment of the required increase in the Program Fee to balance projected operating expenses and revenues for solid waste and recycling services. Scenario 2 assumes the Program Fee balances the Fund's annual budget if other revenues and operating costs equal those projected in the Budget for FY 2016 -17, dependent on the sub - scenario. This iteration serves as a "break- even" analysis. EM Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 2.1.8 Model Results Exhibit 12 shows the Modeled Budgetary Gap for Scenario 1 and the break -even Program Fees for Scenario 2 for FY 2016 -17 to FY 2020 -21, all of which reflect a continuance of the General Fund contribution. In addition to developing the Test Year revenue requirements, SCS forecasted the annual revenue requirement for FY 2016 -17 to FY 2020 -21 based on the projected annual expenses. The assumptions used to develop the forecast for Fund reserves and expenses are presented in Appendix C. These forecasted revenues and expenses were utilized with the Rate Model to calculate the Fund's potential annual net revenue /deficit or break -even Program Fee, depending on the scenario. Note that the Program Fee was back - calculated using an optimization algorithm. Complete financial model results highlighting the Fund's projected annual net revenue /deficits are presented in Appendix F. Exhibit 12. Scenario Modeling Results — Projected Fund Budgetary Gap Scenario FY 2016 -17 FY 2017 -18 FY 2018 -19 FY 2019 -20 FY 2020 -21 1 — Status Quo Budgetary Gap with $107 Program ($1,780,040) ($2,015,497) ($2,064,603) ($2,345,290) ($2,593,011) Fee 2 — Break Even Program Fee with $0 Budgetary $137 $140 $141 $145 $148 Gap Note: Negative values indicate a projected gap. 2.1.9 Division Budgetary Leveling SCS developed a methodology to present the net revenue and expense output by the Model as if the Program Fee contribution in the various Scenarios were disbursed across all four Department Divisions, rather than solely through the Environmental Services Division. Allocations to the respective Department Divisions were made proportionally based on the expenses of those divisions and were calculated with the net output of the Model. This "Division Budgetary Leveling" should be considered for clarity and reference purposes only and is not a financial recommendation. 20 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 3.0 POTENTIAL SOLID WASTE OPERATIONAL CHANGES At the outset of the Study, the County expressed an interest in a brief review of the feasibility of future solid waste operations and financing options. The following discussion is intended to provide a description of the potential options to implement System operational changes intended to achieve the goals of revenue increase and expense reduction, in terms of potential advantages and disadvantages to the County. As County staff have noted, multiple small operations changes can aggregate into large impacts on Department effectiveness and efficiencies which could translate into reduced expenses. In this section SCS enumerates minor and miscellaneous cost saving and revenue generating items. 3.1 OPTIMIZE COLLECTION CENTER HOURS /DAYS OF OPERATIONS One of the duties of collection center attendants is to record customer attendance on an hourly basis. The Eubanks and Walnut Grove waste and recycling centers received the most customers in FY 2015 -16, with yearly customer counts of approximately 145,000 and 136,000, respectively. Note that these centers are open for a total of 59 hours per week, while the remaining three centers are only open for 27 hours per week. The Bradshaw center is the least used with approximately 38,000 customer visits in FY 2015 -16. 3.1 .1 Collection Center Use by Month Consider making monthly or seasonal adjustment to waste and recycling center times of operations based on customer participation. In general, time of year does affect collection center use, with more customer participation apparent in the summer and less in the winter. 3.1.2 Collection Center Use by Day of Week Peak customer attendance occurs on Saturdays, although there is also high attendance on Tuesdays. Peak customer "density" occurs on Sundays by far. The order of most customer visits by day of week to least visits by day of the week is as follows: Saturday, Tuesday, Friday, Sunday, Thursday, and Monday (there are no collection centers open on Wednesdays). The order of busiest or most customer -dense (as determined by most customer visits on a per open hour basis) day of week to least busy day of the week is as follows: Sunday, Saturday, Tuesday, Friday, Thursday, and Monday. If the County were to conduct collection center operations in order to minimize the ratio of operating cost to number of customers served, it should be done with consideration for the busy and less busy days. Customer visits by day of week is displayed in Exhibit 13 and peak customer density is summarized in Exhibit 14. 21 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 13. Recycling Center Customers by Day of Week in FY 201 5 -1 6 700 600 `m 500 E 0 400 V m 300 E 200 Z 100 0 Source: Orange County, 2015 -16 — Bradshaw — Eubanks — Ferguson —high Rock — Walnut Grove* Exhibit 14. Recycling Center Customers per Hour by Day of Week FY 201 5 -1 6 90 p 80 x d 70 n m 60 E 50 0 40 v 30' E 20 Z a 10 4 0 S�c,�A ad aai cep _ J4�baA a �aa le" lea ` jai —Bradshaw —Eubanks — Ferguson —High Rock — Walnut Grove Source: Orange County, 2015 -16 3.1 .3 Collection Center Use by Time of Day Current waste and recycling centers are free for use by the public during various periods between the hours of 0700 and 1800. The collection centers require an attendant to open and close the center at the beginning and end of every day. Exhibit 15 shows that for each site, on average customer attendance steadily increases each hour in the morning until 1100 and then jumps up around lunch time. Counts steadily fall for the rest of the day starting around 1300 for Eubanks and Ferguson, 1400 for Bradshaw, and 1500 for High Rock. Note that hourly customer count data was unavailable for the Walnut Grove site. If the County were to alter the hours of operations of the collection centers, it would be best to open later in the morning (rather than close earlier in the afternoon) in order to maximize the number of customers served while minimizing costs. 22 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 15. Recycling Center Customers by Hour of Day in FY 201 5 -1 6 70 = 60 W °' 50 a 0 40 N 7 U 30 a 20 0 Z m 10 4 0 boo o°o goo goo °o �o boo 0°0 1 °0o 0 0 ti ti ti ti ti o oho. ��oQo,��ao.��o.yy��,y�o,��oo, Source: Orange County, 2015 -16 — Bradshaw — Eubanks — Ferguson —High Rock 3.2 CONSIDER A REDUCTION IN CURBSIDE RECYCLABLES COLLECTION FREQUENCY Orange County provides a high level of service in its collection of recycling. Currently it provides weekly collection service. Many communities across the nation have piloted less frequent collection service (e.g., every other week or monthly) as a means of reducing overall collection costs, while at the same time continuing a form of scheduled curbside collection service. These cost savings have to be balanced against lower recycling rates by customers. In areas where curbside service has been reduced, many communities continue to operate recycling collection centers. Many citizens would likely travel to the collection centers on at least a weekly basis to dispose of their solid waste and could recycle on the same trip. 3.2.1 Other Considerations Orange County should consider evaluating its solid waste program on an ongoing basis internally and/or using third party entities. Examples of considerations could include: 1. Analyze and update collection fees for institutions. 2. Continually audit department staff job responsibilities. 3. Consider additional user charges for HHW /special material management /processing. 4. Evaluate /update fees and policies at the C &D landfill. 23 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 5. Based on fleet audit, assess the need for underutilized equipment and continue to encourage the sharing of equipment among different Divisions within the Department. 6. Continue to consider consolidation of additional resources between two or more Divisions within the Department. 7. Consider the additional sharing of resources of other municipalities and other public and private entities. For example, salaries and other personnel benefits make up one of the largest source of expense throughout all four Divisions within the Department. Reducing the personnel force can have a large effect on Department expenses. The below chart calculates the per person costs for the 64 employees funded by the Department. SCS calculated that an average employee's total expenses within the Department equates to approximately $1 of the Program Fee (or approximately $61,000), as demonstrated in Exhibit 16. Exhibit 16. Average Personnel Direct -Cost per Person Account Description FY 2016 -17 Expense ($) Permanent Salaries 2,602,977 Overtime 42,277 Holiday Pay 37,006 Longevity 30,015 Temporary Personnel 129,694 Social Security 176,202 Medicare 41,209 Medical Insurance 571,099 Med Insurance Payment In Lieu 3,600 HSA Contribution 16,992 Dental Insurance 21,228 Life Insurance 6,571 Retirement 196,641 Non -Sworn 401 (K) 45,046 Total Personnel Direct Costs 3,920,557 Total Personnel Direct Cost /Person 61,259 24 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 4.0 POTENTIAL SOLID WASTE PROGRAM FINANCING ALTERNATIVES The use of the Appropriated Fund Balance as a consistent revenue component highlights the need for financing alternatives, as the Appropriated Fund Balance consists primarily of loans and other borrowed monies previously sequestered for other purposes. The Balance as a portion of total revenue budgeted for FY 2016 -17 is shown in red in Exhibit 17 below. Exhibit 17. Budgeted Solid Waste Management Department Revenue Components as Portions of Total Revenue (FY 2016 -17) ■ County 5W Programs Fee ■ Appropriated Fund Balance i General Fund Contribution ■ Other Funding Sources Additional Solid Waste Program financing alternatives are outlined below. 4.1 COLLECTIONS OF ASSESSED FEE Currently, Orange County budgets for the successful collection of the Solid Waste Programs Fee from 97 percent of the 61,000 assessed properties. The losses from the additional 3 percent not collected translates to 1,830 delinquent properties, or $195,810 in lost revenue annually at a Fee rate of $107 per property. The Solid Waste Management Department could share resources with the Tax Administration Department to collect on the additional 3% of properties. Currently there is an Environmental Enforcement Supervisor and Solid Waste Enforcement Officer on the Solid Waste Staff, in addition to number administrative and managerial positions within the personnel hierarchy. These personnel assets could be utilized to collect additional assessed fee from delinquent property owners, potentially through an incentive system. 25 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 4.2 MODIFICATION OF ORGANICS COLLECTION PROGRAM FUNDING STRUCTURE Commercial curbside collection and residential drop -off collection of food and other organic wastes currently cost the Department $80 per ton per its contract with Brooks Contracting. The Department could encourage residents to compost at home to reduce expenditure by the Department and keep the waste closer to its point of origin for direct reuse. The Brooks composting facility is located an hour southeast of the Town of Chapel Hill, approximately 36 miles away. Significant cost is incurred by the contractor to haul the material to the windrow composting site from the point of collection, and then back to the Orange County Landfill so the finished compost can be solid to residents. Efficiencies are to be gained by changing the approach to the commercial collection efforts and bolstering the home composting program already in place. Additionally, the program funding structure could be changed to implement cost sharing by the largest utilizers of the commercial organics collections program, which could bear some or all of its costs. This would shift the burden of paying for the program from the Programs Fee or general fund to the entities that benefit most from the program. County businesses utilizing the program could pay a flat monthly fee or, alternatively, pay according to the quantity of organics disposed through the program. 4.3 MAJOR WEATHER EVENT /STORM DEBRIS HANDLING Currently the Department handles staging, clearing, and disposal operations for the cleanup of storm debris from major weather events such as tornados, hurricanes, ice storms, and major thunderstorms. Funding for these efforts is not provided via emergency allocations from the General Fund, and the Department generally absorbs the costs. Financial resources should be allocated for these non - routine events so that the cost burden is not transferred to the Department. Additional monies may be allocated into a hypothetical renewal and extension (R &E) fund to cover costs associated with unexpected weather or natural disaster events. 4.4 REGULATED RECYCLABLE MATERIALS ORDINANCE The institution of the Regulated Recyclable Materials Ordinance (RRMO) in October 2002 may have had the unintended side effect of reducing the tonnage of material disposed at the C &D Landfill (without directing this material for recycling). It is possible that the sorting and permitting requirements of the RRMO coupled with the timing of the global economic recession may have caused a decrease in tonnages that has not rebounded as of FY 2015 -16 as shown in Exhibit 18. Although the RRMO does produce additional revenue from contractor licensing fees, the tipping fee revenue and economies of scale lost from the decline in the tonnage of C &D waste disposed (from roughly 30,000 TPY to 6,000 TPY, an 80% decline that equals approximately $960K in lost revenue at the current tipping fee of $40 /ton) outweighs the licensing fee revenue of $120K considerably. 26 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Exhibit 18. Tons Disposed at Orange County C&D Landfill by Year 30,000 25,000 a 20,000 v 0 CL 0 15,000 v m 10,000 0 u 5,000 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 14/15 15/16 Fiscal Year 27 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 5.0 FINDINGS AND RECOMMENDATIONS This findings and recommendations, including revenue increase strategies, expense reduction strategies, and rate benchmarking from the Study are presented below. SCS offers the following findings and recommendations for the County's consideration: • As outlined in Scenario 1, the Fund's current financial structure is unsustainable and maintaining the current Program Fee amount ($107) along with the Status Quo program services will yield significant annual deficits over the next 5 -year period, even with the current practice of General Fund contributions. • The exercise of allocating monies from the Fund's balance ( "Reserves ") to cover the annual budget deficit each year will deplete the entire Fund balance in approximately 5 years at the current rate of spending. • The Pro Forma Rate Model developed as part of this cost of service study should be updated annually and used for long -term financial forecasting of the Fund and to evaluate the likely impact of proposed Department operational changes. • Based on a cursory review of the program, SCS did not identify any notable inefficiencies within the Department operations. SCS recommends the County conduct a more in -depth review of its program on a routine basis to identify opportunities for revenue increase and expense reduction. 5.1 REVENUE INCREASE STRATEGIES Because such a large component of the County's System is correlated with urban and rural curbside recyclable material collection or drop -off, Orange County has historically relied heavily on receiving substantial revenue from the sale of recyclable material to secondary markets. SCS recommends the Department consider a long -term goal to set up an R &E fund to weather the fluctuations in the recyclable commodities market and level any market pricing fluctuations over extended timeframes. Other revenue increase strategies identified include: • Increasing the collection of the Program Fee assessment • Charging commercial entities for organics collection services • Allocating funds from the General Fund to help cover the costs of storm event cleanup • Making efforts to increase waste disposal at the C &D Landfill to capture economics of scale. Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 5.2 EXPENSE REDUCTION STRATEGIES SCS performed a cursory overview of Department programs to identify opportunities to reduce expenses in order to reduce the quantity of General Fund monies to Enterprise Fund. Expense reduction strategies identified include: • Commercial curbside collection and residential drop -off collection of food and other organic wastes currently cost the Department $80 per ton under its contract with Brooks Contracting. The Department could encourage residents to compost at home to reduce expenditure by the Department and keep the waste closer to its point of origin for direct reuse. Alternatively, the County could shift the costs of the program to its largest benefiters, business entities. • Reduce debt servicing costs by continuing to contribute to an equipment reserve fund with which replacement equipment is purchased outright. Consider implementation of an R &E fund as a long -term objective to pay for unexpected costs outright, rather than relying on debt financing. • Consider altering Waste and Recycling Center hours or days of operations to minimize down -time and reduce staff /maintenance costs per customer served. • Establish a long -term financial plan that provides a sustainable financial structure for the Fund. This plan should be formed as a result of a continued evaluation of Department programs to identify issues and inefficiencies (if any exist), optimize the structure of the Department, and find opportunities to further share resources among the four Divisions, in addition to other tasks to increase the effectiveness of the implementation of solid waste and recycling services. 5.3 RATE BENCHMARKING Exhibit 19 graphically illustrates a comparison of the County's FY 2015 -16 Program Fee of $107 with other North Carolina Counties' cumulative Solid Waste Fee rates. As shown, the annual solid waste fees for various municipalities range from a low of $15 to approximately $250. It is unclear what governmental subsidies exist for the communities with the lower fees or what services are provided for the corresponding fees. It is also important to consider the level of service offered by Orange County and the emphasis on environmental justice in regards to waste reduction and recycling, including the achievement of a 64 percent recycling rate. It is not likely to be matched by many, if any, of these jurisdictions. Benchmarking of solid waste agencies is often difficult to accomplish since levels of service and internal charges and subsidies are often difficult to discern from one municipal system to another. As such, most benchmarking programs often deal with individual facilities (e.g., landfills, transfer stations, etc.). There is currently a lack of benchmarking data available in the solid waste industry. SWANA has conducted the most recent benchmarking studies, but these were focused on landfill operations. 29 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Mecklenburg Caldwell Wa ke Surry W ison Cram Wayne- Cumberland I mde11 Franklin Yad kin Al Iegh any Burke Cleveland Johnston Srta my Hamett Pitt M acorn Swain Chemkee Li ncoln Granville Greane Lenoir Jackson Caswell e Wati3uga 0 Robeson Lee Edgecom be Duplin Beaufort Haywood N ash Vanim Clrarge Polk Hoke- Warren Ruth erford Chatham Perquimans H ertfcrd Blad En Ash e 6rrha m Pascluotan k Richmond Chowan M artin Madison G ate s. Cartaret Halifax Tyrrell Northampton Washington Col um bus Curritur=k Pend ar Exhibit 19. Comparison of Annual Fees 5C 100 150 21 C 250 300 Rate ($J Source: NCDEQ Division of Environmental Assistance and Customer Service, FY 2014 -15 30 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund 6.0 REFERENCES Orange County, Approved- Adjusted Budgets, FY 2013 - 2016. 2. Orange County, Chapter 34, Solid Waste Management, Code of Ordinances, 2016. 3. Orange County, Preliminary Solid Waste Program Fee Drivers, February 2016. 4. Orange County, Solid Waste Fund Revenues /Reserves FY 201512016, March 15, 2016. 5. Orange County, Summary of Report on Solid Waste Fees in Select NC Counties, January 29, 2015. 6. Rogoff, Marc J., Solid Waste and Recycling: Planning of Solid Waste Recycling Facilities and Programs, Waltham, MA, William Andrew, 2013. 7. NCDEQ Division of Environmental Assistance and Customer Service, Solid Waste Fee Use in North Carolina (Draft Report), NC DENR Local Government Recycling Assistance Team, FY 2014 -15. Additional internal Orange County data and documents not listed here. 31 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Appendix A Department Organizational Chart Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund Table 1 . Department Organizational Chart and Staffing Sal id Waste Management Director (1) (3 55) Environmental Suppc t I Solid Waste Planner AdministrativeOffim 19nagementand Progra Specialist (845) (854) I---= MM" ReoydingEdu cation and Ad m i n istrativs, Assists nt I I Office Assists ntII Outrea ch Coordi nator (1) (0.875) 11) Disposal Operations llsm) (832) (853) Solid Waste Engi neer {1) {833) v3' EquipmentOperat Landfill Inspector 1 Weigrh master (2) (840) lC) {'841.844] ;8 . New) A -1 Sol id Waste Operations SDI id Waste Operations Manager i1) 1843) Equipmentl4laintenance I I Sanitation Operations I I Permitting /Enforcement Heavy Equipment Solid Waste Collection Environmental Mecha.ninSuparvisx SaricesNlanagef EnfoccementSupervisor 11) 11) {1) {8t§5j (80�) {8481 Heavy Equipment Solid Waste Field Services Solid Waste Enforcement Meehan is I Su per+isir Offi car f3) (1) i'1) {$38,859,1038) (547) (887) 77287.109B. ce CenterOparator E(542.544. ector Driver (14) 03,704,705,708,707, 5413.550) 7,1124.1123.NEW. NEW) (703; -825 to .75 FTE) {1123; .825 to .75 FTE) Reoyd i ng Operations Recycl ing Programs Managef (1) {8413) RecydingPragrams Solid Waste Field Services Su pervisar Supervisor (1) (1) t847) (980) Sol id Waste Collector Driver Solid Waste Materials (10) Transfer Operator 852,883,898,897,978 977,978, (2) 979. NEW. NEW) (851.891 } Recycl ing 1`0atefi9Is Solid Waste Collector Handler Dwiver (s9eo,s94; (8 50) Recycl ing Materials Handler (1) {8M) envy EquipmentOpeFatca (4) '8';5,839,834,837) Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Appendix B Department Fleet Asset List Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund Table 1. Department Fleet Asset List Division Type ID(s) Vehicle Description Environmental Support - Enforcement Vehicle 566 Dodge Durango SUV Environmental Support - Administration Vehicle 885 Dodge Grand Caravan Van Environmental Support — Administration Vehicle 683 Ford Taurus Sedan Environmental Support - Enforcement Vehicle 684 2006 Dodge Pickup Environmental Support - Administration Vehicle 848 Dodge Durango Environmental Support — Vehicle Support Vehicle 688 2006 Ford F -350 Service Truck Environmental Support — Vehicle Support Vehicle 689 2006 Ford F -350 Service Truck Environmental Support — Vehicle Support Vehicle 586 International 4200 Service Truck Landfill Vehicle 687 2006 Dodge 4X4 Pickup Landfill Vehicle 880 Ford F -250 4X4 Pickup Landfill Vehicle 854 Ford 4X4 Pickup Landfill Vehicle 685 2006 Dodge 4X4 Pickup Landfill Equipment (MSW) 227 New Holland T4030 Tractor Landfill Equipment (C &D) TBD CMI 3 -75 Compactor Landfill Equipment (C &D) TBD CAT Articulating Truck Landfill Equipment (C &D) TBD CAT D6R Dozer Landfill Equipment (C &D) TBD CAT 325D Hydraulic Exvac Recycling — Ordinance Area Equipment 433 CAT 315 Excavator Recycling Equipment 460 CAT 924GZ Wheel Loader Recycling — Ordinance Area Equipment 435 Bobcat Skidsteer Recycling — Ordinance Area Equipment 490 Powerscreen 4026 Conveyor Recycling — Ordinance Area Equipment 452 CAT 963D Track Loader Recycling — Ordinance Area Equipment 463 PP Horizontal Grinder 7400 Recycling — Ordinance Area Equipment 853 Landfill Rec- Pickup Recycling — Ordinance Area Equipment 451 Rosco Sweeper Pro Recycling — Universal Services Vehicle 855 Ford F -250 Pickup Recycling — Universal Services Vehicle 1779 Freightliner FL -120 Roll -off Truck Recycling — Universal Services Vehicle 1781 Peterbuilt/Heil Frontloader Truck Recycling — Universal Services Vehicle 1681 2007 Freightliner Roll -off Truck Recycling — Universal Services Vehicle 1486 Izsuzu NPR Glass Flatbed Truck Recycling — Universal Services Vehicle 851 Labrie Crane Carrier Recycling Truck Recycling — Universal Services Vehicle 1639 GWC W4500 Box Recycling Truck Recycling — Universal Services Vehicle 872 Peterbuilt/Heil Frontloader Truck Recycling — Universal Services Equipment 1776 Bobcat Skidsteer Recycling — Universal Services Equipment 450 Clark CMP25 REI Plastic Compactor Recycling — Universal Services Equipment 428 Clark CMP25 Off -road Fork Lift Recycling — Universal Services Vehicle 432 2006 Dodge 4X3 Pickup Recycling — Universal Services Vehicle 1637 Freightliner Multi- family Recycling Truck Recycling — Universal Services Equipment 897 Rudco RP -400 Stationary Compactor Recycling — Universal Services Equipment 581 WG SWCC OCC Compactor Recycling — Universal Services Equipment WG SWCC SS Compactor Recycling — Universal Services Vehicle 930 Dodge 2500 Pickup Truck Recycling — Universal Services Vehicle 1491 Manac Walking Trailer Recycling — Universal Services Vehicle 887 Peterbuilt Road Tractor Recycling — Universal Services Vehicle 846 Freightliner Road Tractor Recycling — Multifamily Equipment 467 Bobcat Model 863 Skidsteer Multifamily Recycling — Multifamily Vehicle 942 Freightliner Commercial Recycling Truck Recycling — Urban Curbside Vehicle 1686 Dodge 1500 Pickup Recycling — Rural Curbside Vehicle 923 Labrie Crane Carrier Top Select 1000 Recycling Truck Recycling — Rural Curbside Vehicle 924 Labrie Crane Carrier Top Select 1000 Recycling Truck Recycling — Rural Curbside Vehicle Recycling Truck (TBD) Recycling — Rural Curbside Vehicle Recycling Truck (TBD) Recycling — Rural Curbside Vehicle 850 Transit Connect Van Recycling — Rural Curbside Equipment 429 CAT 906H Compact Loader Recycling — Rural Curbside Vehicle 431 2009 MAC 48' Walking Floor Trailer Sanitation — Replacement Vehicle 232 International Dump Truck Sanitation — Replacement Vehicle 679 Sterling Dump Truck Sanitation — Replacement Vehicle 919 Chevy Equinox Sanitation — Replacement Vehicle 852 Ford F250 Pickup Sanitation — Replacement Vehicle TBD Peterbuilt Front Loader Sanitation — Replacement Vehicle 881 Peterbuilt Front Loader Sanitation — Change Vehicle 780 Peterbuilt Front Loader to Roll -off Sanitation — Change Vehicle 844 International SwapLoader Roll -off Sanitation — Replacement Vehicle 922 Freightliner Roll -off Sanitation — Replacement Vehicle 927 Freightliner Roll -off Sanitation - Replacement Equipment 7060 Bobcat Skidsteer Sanitation - Replacement Equipment 7061 Case Skidsteer Sanitation - Replacement Equipment 7062 Bobcat Skidsteer Sanitation - Replacement Equipment 7063 Bobcat Skidsteer Sanitation - Add Equipment 7064 Bobcat Skidsteer Sanitation — Replacement as Needed Equipment 00 -01 Hudson Trailer Sanitation — Replacement as Needed Equipment 7065 Contral Trailer Sanitation Equipment C -5 Bakers Compactor Bulky Waste Sanitation Equipment C -1 Bakers Compactor MSW Sanitation Equipment C -2 Bakers Compactor MSW Sanitation — Add Equipment TBD Bakers Compactor Bulky Waste Source: Orange County, 2016 B -1 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Appendix C List of Model Assumptions Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund LIST OF MODEL ASSUMPTIONS GENERAL • The County provided FY 2016 -17 Budget values for revenues and expenses associated with the Enterprise Fund. SCS compared these values with the previous 3 years of "Past Actual" values for FY 2012 -13, 2013 -14, and 2014 -15, as well as the FY 2015 -16 Original Budget and Revised Budget values, to assess the reasonableness of the Budget. Obviously, certain revenues and expenses have been dramatically changed since the closing of the County's sanitary landfill in June 2013. Generally speaking, SCS concluded that the FY 2016 -17 Budget values for the anticipated revenues and operating expenses that the County provided were appropriate and reasonable based on our understanding of the County's solid waste and recycling programs and facilities operating under each of the four divisions. Furthermore, SCS concluded that the FY 2016 -17 Budget values for approximately 33 revenue line items and 50 operating expense line items were appropriate to serve as the baseline, or "Test Year" for projecting the subsequent four future fiscal year revenues and operating expenses. The exact manner in which these projections were accomplished is described below. • Line item accounts that had a value of zero for the FY 2016 -17 Budget were anticipated to be zero for all future years and, thus, were essentially excluded from the analysis. Only Revenue and Expense account line items with a value greater than zero were included in this analysis. • Future projections for line items are escalated using the annual inflationary factor of 2.1 %, which represents a calculated average of historical CPI. • For purposes of characterizing annual deficits within the Enterprise Fund as being funded by revenue that would originate from potential increases to the County's property tax rate (per $100 of assessed value), SCS assumed that each $0.01 incremental increase to the tax rate yielded $1,655,660 in annual revenue. REVENUES Future projections for the 33 revenue line item accounts for the four subsequent fiscal years (FY 2017 -18, FY 2018 -19, FY 2019 -20, and FY 2020 -21) are either maintained constant or escalated using the annual inflationary factor and the Test Year as the baseline, unless noted in the table below as being handled differently. • County Solid Waste Programs Fee: The current fiscal year (FY 2015 -16) is the first year in which this revenue line item account has been in effect and SCS understand it reflects the initial Program Fee of $107 applied to 60,178 parcels. Projections for the four future fiscal years were escalated by 1.1 %, which is the projected annual population growth, to reflect the fee being assessed for additional parcels. C -1 Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund General Fund Contribution: SCS understands that the County has established a precedent since FY 2007 -08 of utilizing contributions from the General Fund as revenue into the Sanitation Services Division. SCS' analysis was structured to assume that the contribution from the General Fund for the Test Year and four subsequent fiscal years is maintained at approximately $2 million per year. • Appropriated Balance Fund: SCS understands that the Appropriated Fund Balance line item account is used to balance the budget. It reflects load proceeds, Program Fee rounding, and other general fund transfers. While the County provided the value for the FY 2015 -16 Budget as approximately $1.7 million, SCS opted to only account for known debt - financed endeavors in future fiscal years, which includes loans for convenience center construction costs in FY 2018 -19 and FY 2020 -21 ($804,784 and $904,255, respectively). No other loan proceeds or general fund transfers were included beyond the Test Year. Also note that the $345,432 loan portion of the FY 2016 -17 Appropriated Fund Balance line item was included in the Revenues for both Scenarios for that year. • Contributions from Equipment Reserves: Note that one of the largest revenue line item accounts is the Contributions from Equipment Reserves, which has historically varied significantly from year to year and will likely do so in future years. SCS utilized values that were provided by the County as projected revenues for this line item account for the four subsequent future fiscal years. • Landfill Gas Recovery Revenue: SCS applied a deflationary factor of -3% to projected landfill gas recovery revenues to account for closure of the Orange County Landfill. EXPENSES Future projections for the 50 operating expense line item accounts for the four subsequent fiscal years (FY 2017 -18, FY 2018 -19, FY 2019 -20, and FY 2020 -21) are escalated using the annual inflationary factor and the Test Year as the baseline, unless noted below as being handled differently. • Landfill Fees: The solid waste collected by the County is currently hauled and tipped at the transfer station in Durham. SCS assumed that, in addition to escalating annual costs by an inflationary factor, the Landfill Fees operating expense line item account will be impacted by a $2 /ton tipping fee increase (from $42.50 to $44.50) in FY 2018 -19, which is a 4.7% increase. • Debt Service Principal /Debt Service Interest: Debt servicing line items including debt service to principal and debt service to interest were escalated but kept in the same proportion. • Contributions to Equipment Reserves: Note that one of the largest operating expense line item accounts is the Contributions to Equipment Reserves, which has historically varied significantly from year to year and will likely do so in future years. SCS C -2 Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund utilized values that were provided by the County as projected costs for this line item account for the four subsequent future fiscal years. SCS assumes the existing equipment reserve fund will be incorporated into any future R &E Fund. • Capital Expenses — IT Equipment and Furnishings: The limited expenses of IT Equipment and Furnishings were assumed to be $5,000 and $1,000 annually in the four years succeeding the Test Year. • Capital Expenses — Equipment and Vehicles: The costs for replacing the County's vehicles operated within the Solid Waste Department is expected to be financed through various mechanisms including the Equipment Reserves Fund and debt - servicing, thus, these line items are handled under separate line items in capital expenses as lump sum costs provided by the County. • Capital Expenses — Construction: The costs for upgrades to the County's solid waste and recycling convenience centers that are anticipated to occur in FY 2017 -18 and FY 2019 -20 are expected to be debt - financed and, thus, are handled in capital expenses under the Construction line item account as lump sum costs with correlating amounts introduced into the revenues in the Appropriated Fund Balance line item account as loan proceeds. OTHER ASSUMPTIONS • Program Fee kept at $107 /year and appropriated fund balance used to balance budget for status quo Scenario 1 for FY 2016 -17 ONLY. C -3 Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund Table 1. Budget Revenue Accounts Budget Revenue Accounts Description Projection Assumption 422050 C &D License /Permit Apply Inflation Factor Only 439000 Sanitation Waste Collections Apply Inflation Factor Only 460000 Interest On Investments Apply Inflation Factor Only 470001 Sale Of Fixed Assets Hold Constant Only 479051 Clean Metal And White Goods Hold Constant Only 479052 Clean Wood Out Hold Constant Only 479053 Occ (Municipal) Collections Hold Constant Only 479058 Recycling Tip Fees Hold Constant Only 479061 Tire Tax Reimbursement Hold Constant Only 479062 White Goods Reimbursement Hold Constant Only 479063 Mattress Fee Hold Constant Only 479065 Sales Mulch Hold Constant Only 479066 Sales Compost Hold Constant Only 479068 Sales Of Recycling Material Hold Constant Only 479073 Solid Waste Disposal Fee (NC) Hold Constant Only 479074 Landfill Gas Recovery Apply 3% Decrease Only 479079 State Electronics Mgmt Funds Hold Constant Only 479080 Ncdeao Grant Funds Hold Constant Only 479085 County Sw Programs Fee Apply Population Growth Factor Only 479810 Disposal Tax Reimbursement Hold Constant Only 489996 County Gen Fund Contribution Hold Constant Only 489999 Contribution From Equip Resrvs County Provided 499900 Appropriated Fund Balance County Provided 499999 Miscellaneous Revenue Apply Inflation Factor Only 499999 Landfill Fees Hold Constant Only 682001 Landfill Fines (Penalty Surcharge) Hold Constant Only Table 2. Budget Expense Accounts Budget Expense Accounts Description Projection Assumption Capital Expenses 510000 Permanent Salaries Apply Inflation Factor Only 510100 Overtime Apply Inflation Factor Only 510102 Holiday Pay Apply Inflation Factor Only 510200 Longevity Apply Inflation Factor Only 511000 Temporary Personnel Apply Inflation Factor Only 511003 Student Interns Apply Inflation Factor Only 520000 Social Security Apply Inflation Factor Only 520001 Medicare Apply Inflation Factor Only 520100 Medical Insurance Apply Inflation Factor Only 520101 Medical Insurance Payment In Lieu Apply Inflation Factor Only 520110 HSA Contribution Apply Inflation Factor Only 520150 Dental Insurance Apply Inflation Factor Only 520160 Life Insurance Apply Inflation Factor Only 520200 Retirement Apply Inflation Factor Only C -4 Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund Budget Expense Accounts Description Projection Assumption Capital Expenses 520305 Non -Sworn 401(K) Apply Inflation Factor Only 530100 Training /Development Apply Inflation Factor Only 530500 Personal Mileage Apply Inflation Factor Only 540000 Telephone Apply Inflation Factor Only 550000 Postage Apply Inflation Factor Only 560000 Vehicle Maintenance Apply Inflation Factor Only 570000 Building Repairs Apply Inflation Factor Only 571000 Equipment Repairs Apply Inflation Factor Only 581000 Equipment Rent Apply Inflation Factor Only 590000 Duplicating Apply Inflation Factor Only 591000 Printing Apply Inflation Factor Only 600000 Advertising Apply Inflation Factor Only 610000 Dues Apply Inflation Factor Only 611000 Subscriptions Apply Inflation Factor Only 620000 Departmental Supplies Apply Inflation Factor Only 621000 Office Supplies Apply Inflation Factor Only 621050 Vehicle Supplies Apply Inflation Factor Only 630000 Prof. Contract Services Apply Inflation Factor Only 630003 Misc Contract Services Apply Inflation Factor Only 641000 Bonds & Insurance Apply Inflation Factor Only 641005 Workers Compensation Apply Inflation Factor Only 650000 Electricity Apply Inflation Factor Only 651000 Water and Sewer Apply Inflation Factor Only 652002 Propane Gas Apply Inflation Factor Only 670000 Uniforms Apply Inflation Factor Only 682000 Landfill Fees Apply Inflation Factor and Increase by $2 to $44.50 in FY 2018- 19 682004 NC Solid Waste Disposal Tax Apply Inflation Factor Only 682005 Processing Fee Apply Inflation Factor Only 690000 Charges By General Fund Apply Inflation Factor Only 700100 Debt Service Principal Proportion Based on County Provided (Total Debt Number * 63 %) 700101 Debt Service Interest Proportion Based on County Provided (Total Debt Number * 37 %) 720015 Retiree Health Apply Inflation Factor Only 910050 Contribution To Equip Reserves County Provided 800000 Equipment County Provided 800100 It Equipment $5K in FY 2016 -17; Inflation Factor Applied Thereafter 801000 Furnishings $1 K in FY 2016 -17; Inflation Factor Applied Thereafter 802000 Vehicles County Provided 880000 Construction County Provided C -5 Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund Table 3. General Assumptions and Quantities Item Input Description Quantity Units /Description Comments /Source GENERAL ASSUMPTIONS I Consumer Price Index 2.1% Annual CPI - 12 YearAverage U.S. Department of Labor SCS Provided 2 VohiclesiEquiprnent Varies Coun ty Provided Replacement Schedules County Provided 3 Customer Growth Rate 1.10% Estunated Growth Rate " 4 Number of Parcels 60,178 Parcels 97% oftotal assumed for budgeting purposes)" 5 Landfill Gas De- escalation Rate -3.0% Assumes decline in LFG sales revenue at closed.L.andffi SCS Assumptions 6 Property Tax Revenue Generation Factor $ 1,655,660.00 Property Tax revenue yearly per I cent rate increase County Provided REVENUE 7 Rec fables Varies er ton (—$140,000/year) Com Provided 8 Tipping Fee at Orange 8.1 C &D $ 40 $ 18 Perron County Provided _ " 8.2 Vegative Waste /Clean Wood per ton ($20 plamed FY 2016 -17 8.3 Tires (stoc fled ) $ 100 Perron " 8.4 Pick-up Trailer $ 22 per load " 8.5 car $ 10 rton 8.6 Mattress/Box Spriings 10 per Piece " 9 YealyFees for Scenario Mode 9.1 Yearly Fee - Status Quo: Scenario I $ 107.00 per parcel (- 60,178 parcels in Test Year) Coutrty Provided 9.2 Yearly Fee - Scenario 2: Break Even Scenario Calculated 10 Transfer from Gereral Fund $ 2,004,719.00 —$2 Mil -35 %Net ease; 65% ofSandation Division) County Provided 11 Defauk Appropriated Fond Balance Transfer $ 1,680,040.00 —$1.7 Mil bans, round' etc.; covers budget shortfall)" EXPENSES 12 T Fee : SCS Ass [ions 12.1 MSW Current $42.50 C' of Durham TS ( —$565K FY 15 -16, —42 TPD Corn Provided 12.2 MSW Anticipated $44.50Pro'eeted City of wham TS starting FY 2018 -19 " C -6 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Appendix D Estimated Department Revenue Projections Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund Table 1. Estimated Department Revenue Projections Budget Accounts Description FY'2016 -17 BUDGET FY2017 -18 PROJECTED FY2018-19 PROJECTED Budget Accounts Description Environment al Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation services (3530) Total Revenues Environment al Support (3590) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Revenues Environment al SLipPtlrt iM000 Landfill Services (3510) Recycling Services (3520) Sanitation Services 13530} Total Revenues 422050 C&DLeema?ermit 124,000 130,445 4390M Sanity on MIA2 Co-llect om 120,000 122.530 104,562 74.522 1'4..54 1'1.2,530 {?5.113 107.073 '6.49: 183,166 12511.3 439,000 5anitattion' la�teColleatms 98,509 74,0404 168,509 1005 -7 71.4'76 172,953 142,697 ?_'.983 17500 464009 11teres -t on In'MrUna3t, 15,000 15,040 15 316 50,044 15,316 15,639 50,044 15,639 470D01 Sale OfFinad 7,944 49,044 34,404 86,940 7,040 49,004) 3014D4 967940 7,949 479053 49,4044 34,0474 86,044 479051 Clean Metal And Wkte Goac1 i -1. X i 507000 12,000 50.000 12,040 479058 50,009 50,000 210,000 50,040 50,040 479052 Clexa ood Chat 210,009 479961 97000 9.11U, 150,4411 9,009 97940 150,4001) 97000 479662 9,000 4'79053 occ ci Collect= 55,009 12,000 12 5r 0 55,ODDI 12.000 479063 12.040 12,000 12.000 479058 F- 1-11n9 Tip Few 20,000 210,000 479065 210.,11, 210,000 210,000 210,440 210,400 479061 Tim Tax RMMn r reMEat 150,0M 150.00 0 150,040 150,0MI 479068 SLes 0fRecychngMatmal 1 50,000 159 000 479062 A` me Cxwd_. Remtsursemlent 55,040 55,949 4794073 Solid Waste Eh:poml Fee (NQ 55,040 --n-2011 55,040 1 55,040 13,474' 557040 479063 Mattress Fee 479,074 Lardfill Gas' -ery 20,000 ?1,497 20,000 PI 31,487 20,000 30,543 20,040 30,543 20,040 State EectromcsMemtFunds 20,000 479065 Salts hfulch 8,000 47,500 47,500 8,040 47,549 bk� Grant F,mds 47,540 35,000 47,540 35.11r(1 47,500 479+0M Sates Co®p 35,000 21,450 County Svc Programs Fee 21,4547 21,450 6,653,333 21,450 21,4540 61727,073 21,450 479068 Sat- .CtfRec5rli Matenal 125,840 1 1_5,849 125,800 125,800 County Gm Fund Co=nbut m 125,840 125,800 479073 Solid Waste Drposal Fee (NQ 12,400 2.004,714 2,044,719 12,404 error an From Eqmp 12 -661 P 1 =-66.1 12.928 . , 12" 479074 Landfill Gas Reem -my lai Apprnated Fund Balance 34,500 NA NA 34.500 4r,4.' . 33.465 NA NA 33.465 0 32.461 MLnellamemtsRmvnue 32,461 479479 State Elecctr=5 ME= fuac s :.Ss= 87000 5:979 3.00 0 5.979 44999{1 5.000 87000 87040 8,000 479080 Ncdeao Caand Fu a -. 235,640 682001 357000 3 5.00 0 3 SA0 0 35 940 35 904 REVEN E SI-Ml 35 440 479085 County SwPmgrams Fee 6,439,046 1'_,2 +1,065 6,880.8'_3 310,222 6.439,046 6,549)876 11,537,036 6,549,876 6.581.434 6,581,484 479814 Disposal Tax Fombmemait 34,000 3,.:1.0091 30,43E 30,000 34.4D4 30,000 489996 County Gen Fund C onrnbut cn 2,OD4,719 47---,, 2.01)4.714 2,004;719 2.444.719 2,004319 489999 Crmtnbutim From EgiupResn -s 26,117 187,190 100.993 47 Ci 176,501 29,366 282?11 486;775 63415 367,329 749,110 280.764 1.460,618 4999M Apprnpaiated Fund Bilance NA NA 'TA NA 1.750.04 '_ETA NA NA NA 844;784 1;A NA ETA NA 0 499999 h4iscellanemz RL-enue 5,504 5,540 5,616 5,616 5734 5,734 499999 LanditllFees 235,600 235604 235,600 235,600 235.600 235640 682001 LmdfillFines(Penallt3 Surdxarp) 600 45H 600 600 �92 600 600 EL ENE SUM 6 G7 163 ++74'_90 997,743 2,104,719 ' 11 89,9)5 6 31'23 341,892 11811 +4 '_ 11) 19+ 11,21 '_48 678,918 IA--4':9: ?9_' '_.,388.466 11,410,X27 Budget Accounts Description FY2010 -20 PROJECTED FY2020 -21 PROJECTED Environment al support (3500) Landfill services (3510) Recycling Services (3520( Sanitation services (3530) Total Revenues Environment al support (3540) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Revenues 422950 C&D heensaPermrt 127,751 1_'7.751 130,445 130,445 4390M Sanity on MIA2 Co-llect om 104,562 74.522 1'4..54 107.073 '6.49: 183,166 460000 BAEML -t On ln.E,-tnaenta 15,969 lv. 6 ' 16,346 16,346 479051 Clean Mer:.And iy. kte Gaxla 50,044 50.:IC0 50,044 50,900 479052 Clean W' 43ut 9,000 9..n,!1 9,000 9,000 479053 Occ (bl micipal} collecaom 12,000 i -1. X i 12,000 12,040 479058 Rec�rling Tip Fees 210,000 '105',0 i_ 210,040 210,009 479961 Tire Tax Reimbui:eenent 150,4411 :).7C: 150,4001) 150,949 479662 Mute Goods Fambumemmt 55,009 55,ODDI 55.040 479063 MattrefsFee 20,000 'O..iC: 20,000 20,000 479065 Saes Mu b-h 47,504 -- .=1;1' 47,509 47,509 e.e aanpo 21,450 21,450 479068 SLes 0fRecychngMatmal 125,800 1_'9.500 125,800 125,800 4794073 Solid Waste Eh:poml Fee (NQ --n-2011 B201 13,474' 13,479 479,074 Lardfill Gas' -ery ?1,497 31,487 30,543 30,543 479,079 State EectromcsMemtFunds 8,004 8,000 8,000 8,040 479080 bk� Grant F,mds 35,000 35.11r(1 35,000 35,000 479085 County Svc Programs Fee 6,653,880 6,653,333 6,727,073 61727,073 lksperal lax Keambursexne= 489996 County Gm Fund Co=nbut m 2,404,719 2,004 ? 719 2.004,714 2,044,719 error an From Eqmp P . , 499900 lai Apprnated Fund Balance INA NA NA NA 4r,4.' . '4A NA NA NA 0 499999 MLnellamemtsRmvnue 5,855 :.Ss= 5:979 5.979 44999{1 Tmdfill Fees 235,600 235.600 235,600 235,640 682001 Landfill Fines (FeuxltySurdmxge) 600 6C0 600 600 REVEN E SI-Ml 6,84#401 310,888 1,762,249 2,4469,473 1'_,2 +1,065 6,880.8'_3 310,222 1,713,_276 2,632,716 11,537,036 row Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Appendix E Estimated Department Expense Projections Orange County, NC Financial Plan and Rate Study for Solid Waste Enterprise Fund Table 1. Estimated Department Expense Projections ACCOUNT NUMBER DESCRIPTION PROJECTED PROJECTED FY 2019-201$) FY 2020 -21 ($) Environment al Support (35001 Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Expense Environment sl Support {3500) Landfill Services (35101 Recycling Services (35201 Sanitation Services (35301 Total Expmse 510DOD Permanent Salaries 825.304 247,186 91 709,828 2,771.111 842,705 252,397 1,009,640 724,793 2,829,535 510100 Overtime 4,629 1,876 18,164 20,339 45,038 4,726 1,915 18,547 20,768 45,957 510402 Holiday Pay 2,036. 2,627 19,929 14.994 39,396 2,078 2;683 20.349 15,116 40,227 510200 Longevity 17,601 1,417 8,955 3.981 31,954 17,972 1447 9,144 4,064 32,627 5110n0 Temporary Personnel 9,563 2 862 48138 77 509 136,071 9,765 2,922 49,153 79,143 140,982 511003 Student lntems 11,711 0 0 D 11711 11,957 0 ❑ 1 D 11,957 5200OD Social Security 53,266 15,870 67,207 51,241 187,583 54,389 16,264 68,624 1 52,321 191,538 520001 Medicare 12,458 3,711 15,718 11,984 43,871 12,721 3,789 16,049 1 12,237 44,796 520100 Medical lraur- 127,58❑ 51,688 228,776 199,944 607,988 13D,270 52,778 233,599 204,161) 620,806 520101 Meal Ins Pmt In Lieu 1,278 0 1,278 1,278 3,833 1,304 D 1,304 1,304 3,913 52011❑ Hsa Contribution 4,522 2,261 6,291 3,015 18,090 4,618 2.,309 8,466 3,078 18,471 52015D Dental Insurance 4,663 1,614 8,648 7,713 22,599 4,761 1,646 8,791 7,876 23,076 520160 Life Insurance 1,789 598 2,763 1,906 1 6,995 1,626 611 21760 1,946 7,143 520280 Retirement 61,594 18,350 75,699 54,30D 209,343 62,893 18,737 76,682 55,444 213,756 520305 NonSwom 401(x) 9,895 3,426 10,268 16.366 47,956 10.104 3,4913 18 654 16,711 4B.967 530100 Tramingl[] + elopment 22 368. 6,643 6'769 4,948 40,728 22,W 6,783 6,911 5,053 41,587 53050D Personal Mleage 0 0 0 211 211 0 D D 215 2.15 540000 Telephone 18,982 0 7,367 16,342 42,690 19,362 0 7,522 16,686 43,590 550DOD Postage 41,743 0 0 0 41,743 42,623 0 0 0 42,623 560000 Vehicle Maintenance 9,581 7,346 251,350 136,949 405,227 9,783 7,501 256,650 139,837 413,771) 570000 Building Repairs 19,498 1 2,560 13,840 37,701 73,600 19,909 2,614 14,131 38,496 75,151 571000 Equipment Repairs 7,346 62,811 122,215 50,967 1 243,339 7,501 64,135 124,792 52,042 1 248,470 581000 Equipment Rent 3,098 363 2,555 3,603 9,639 3,163 391 2,699 3,679 9,842 59000D Duplicating 1,065 0 0 D 1,065 1,087 0 0 D 1,087 591000 Printing 15 916 0 0 8,517 24 432 16 251 0 0 8,696 24,948 60000D Advertieing 64195 0 0 D 64195 65.548 0 D 0 65548 610DOO Dues 4,929 9,094 719 919 15,660 5,633 9,285 734 938 15,990 611000 Subscriptions 176 0 0 D 176 179 D 0 D 179 62OOOD Departmental Supplies 42,88❑ 27,602 135,544 58,376 264,401 1 43,784 28,184 138,402 59,687 269,976 621000 Office Supplies 2,661 0 0 ❑ 2,661 2,718 0 0 0 2,718 621050 Vehicle Supplies 11,657 1 48,637 269,534 134,718 464,546 11,903 49,662 275,216 137,558 474,34D 630QOD Prof. Contract Services 5,509 471,161 63,876 ❑ 540,546 5,625 481,095 65,222 0 551,942 690003 Misc Contract Services 29,496 27,999 1,673,1D6 11,8BT 1,742.483 30,120 28,589 1,708,380 12,131 1;779,220 641000 Bonds 8 Insurance 34,477 0 0 D 34,477 35,204 D 0 0 35,204 641005 Workers Compersatiun 50,326 0 0 D 51)326 51,3813 D 0 ❑ 51,388 650000 Elechicity 39,922 0 0 30,142 71)064 40.764 D 0 30 777 71,541 651000 Water and Sewer Q 0 0 6,388 6,388 0 D 0 6,522 6,522 652002 Propane Gas 6,D68 0 3,194 Q 1 9,262 6,196 0 3,261 a 9,457 67000D Jn1otms 3,168 1,833 9,049 8,358 22,406 3,233 1,872 9,240 6,534 22,879 682000 Landfill Fees 0 0 0 645,124 645,124 0 0 0 658,726 658,726 682004 NC Solid Waste Disposal Tax 0 13,201 0 0 13,201 0 13,479 0 0 13,479 682005 Processing Fee 0 0 149,043 0 0 0 152,185 4 69000D Ctwges By General Fund 551,818 0 Q 0 551,81 D 563,444 D 0 D 563,444 700100 Debt Service Principal 106.461 0 250,253 316,605 673,318 106,461 D 250,253 364,161 720,874 700401 Debt Service Interest 0 146,974 185,942 395,441 62,524 0 146,974 213,872 423.371 720015 Retiree NeaHh 62172 3,249 ST, 129 141,704 19,557 63,463 3,318 58,334 144,691 910051) Contribution To Equip Reserves M2,375,156 458,150 1,019,502 311,906 1,541,817 52,259 158,150 4,442,330 332,832 1,585,574 Operating Expenses Subtotal 1,253 078 5, 064 1 3,200,932 12,318,18a 2,420 568 1. 76 163 S,749,892 3 347,669 12,642,097 80DOOD Equipment' 0 1 0 1 0 1 0 D 0 0 0 6 0 800100 It Equipment` 5,213 1 0 1 0 1 D 5,213 5,323 D 0 C 5,323 80100❑ Fumishings' t,D43 0 Q D 1,043 1,065 D 0 0 1,065 802000 Vehicles' Q 0 858,781 359,832 1,218.613 0 D 867,473 521,904 1,329,377 88000D Construction" Q 1 0 1 0 1 904,255 964,255 0 D D 0 0 Capital Expenses Sulatotall 6,256 1 1 858,784 1 1,264,087 2,129,124 6,388 0 807,473 521.904 1.335,755 SOLD WASTE Total Expenses 1 $2,3131,412 1 $1,253,078 1 $6496,845 1 $4,465.019 1 $14,596,354 $2,426,955 $1,276,163 S6,557,365 $3,869,563 $14,130,047 �e rer�rrg row iu.o 5.o y�.o .ri o it a n.a �v.o cr .r. Varies widely from year l6 Year E -1 Orange County, NC Financial Plan & Rate Study for Solid Waste Enterprise Fund Appendix F Model Output Table 1. Scenarios 1 and 2 SCENARIO 1 - Status Quo: $107 Fee (Includes General Fund Contt ribution "' $2 Million) PROJECTED BUDGET PROJECTED PROJECTED FY 2016 -17 FY 2017 -18 FY 2018 -19 Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Tota12 Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Program Fee Revenue 1,201,600 600,092 2,927,330 1,710,024 6,439,046 1,195,659 573,324 2,779,878 1,961,015 6,509,876 1,160,497 742,053 3,022,360 1,656,574 6,581,484 Other Revenues 168,117 500,290 997,743 2,104,719 3,770,869 321,347 341,892 1,181,154 2,106,195 4,755,372 211,168 1,371,665 678,918 1,650,292 2,388,466 4,928,843 Total Revenues 1,369,717 1,100,382 3,925,073 3,814,743 10,209,915 1,517,006 915,217 3,961,031 4,067,210 11,265,248 1,420,972 4,672,651 4,045,040 11,510,327 Total Expenses 2,237,464 1,117,414 5,450,893 3,184,184 11,989,955 2,439,253 1,169,634 5,671,206 4,000,651 13,280,744 2,393,635 ($1,021,970) 1,530,554 6,233,901 3,416,840 13,574,930 Net Revenues (Deficits) 1 ($867,747) ($17,032) ($1,525,820) $630,559 1 ($1,780,040) ($922,248) ($254,417) ($1,710,175) $66,559 1 ($2,015,497) ($109,583) ($1,561,250) $628,200 1 ($2,064,603) Scenario 1: Budget Gap ($1,780,040) ($2,015,497) SCENARIO 1 - Status Quo: $107 Fee (Includes General Fund Contribution "' $2 i Million) PROJECTED PROJECTED FY 2019 -20 FY 2020 -21 Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Tota12 Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Program Fee Revenue 1,085,588 571,227 2,961,646 2,035,419 6,653,880 1,155,432 607,559 3,121,849 1,842,233 6,727,073 Other Revenues 150,720 310,888 1,762,249 2,469,073 5,597,184 153,750 310,222 1,713,275 2,632,716 4,809,963 Total Revenues 1,236,308 882,115 4,723,895 4,504,492 12,251,065 1,309,182 917,781 4,835,124 4,474,948 11,537,036 Total Expenses 2,381,412 1,253,078 6,496,845 4,465,019 14,596,354 2,426,955 1,276,163 6,557,365 3,869,563 14,130,047 Net Revenues (Deficits) ($1,145,104) ($370,963) ($1,772,951) $39,473 1 ($2,345,290) ($1,117,773) ($358,382) ($1,722,241) $605,385 1 ($2,593,011) Scenario 1: Budget Gap ($2,345,290) ($2,593,011) ($2,064,603) SCENARIO 2 - Break Even Scenario PROJECTED BUDGET PROJECTED PROJECTED FY 2016 -17 FY 2017 -18 FY 2018 -19 Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Tota IZ Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Program Fee Revenue 1,533,776 765,985 3,736,574 2,182,751 8,219,086 1,565,842 321,347 1,887,189 750,829 3,640,544 2,568,157 8,525,372 1,524,544 211,168 1,735,711 974,834 3,970,470 2,176,239 8,646,087 Other Revenues 168,117 500,290 997,743 2,104,719 3,770,869 341,892 1,181,154 2,106,195 4,755,372 678,918 1,650,292 2,388,466 4,928,843 Total Revenues 1,701,893 1,266,275 4,734,317 4,287,470 11,989,955 1,092,721 4,821,698 4,674,352 13,280,744 1,653,753 5,620,762 4,564,705 13,574,930 Total Expenses 1 2,237,464 1,117,414 5,450,893 3,184,184 11,989,9551 2,439,253 1 ($552,064) 1,169,634 5,671,206 4,000,651 13,280,7441 1 2,393,635 11 ($657,923)1 1,530,554 6,233,901 3,416,840 13,574,930 Net Revenues (Deficits) 1 ($535,571) $148,861 ($716,576)1 $1,103,286 $0 ($76,913) ($849,508)1 $673,701 $0 $123,198 1 ($613,140)1 $1,147,865 1 $0 Scenario 2: Deficit /Surplus w/ General Fund $0 Scenario 2: Break -Even Program Fee w/ General Fund $136.58 $0 $140.13 SCENARIO 2 - Break Even Scenario PROJECTED PROJECTED FY 2019 -20 FY 2020 -21 Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total2 Environmental Support (3500) Landfill Services (3510) Recycling Services (3520) Sanitation Services (3530) Total Program Fee Revenue 1,468,225 772,567 4,005,536 2,752,843 8,999,170 1,600,803 841,749 4,325,194 2,552,338 9,320,084 Other Revenues 150,720 310,888 1,762,249 2,469,073 5,597,184 153,750 1,754,554 310,222 1,713,275 2,632,716 4,809,963 Total Revenues 1,618,945 1,083,4561 5,767,784 5,221,915 14,596,355 1,151,971 6,038,469 5,185,053 14,130,047 Total Expenses 2,381,412 1,253,078 6,496,845 4,465,019 14,596,354 2,426,955 1 ($672,402) 1,276,163 6,557,365 3,869,563 14,130,047 Net Revenues (Deficits) 1 ($762,467) ($169,623) ($729,061)1 $756,896 $0 ($124,193) ($518,896)F $1,315,491 $0 Scenario 2: Deficit /Surplus w/ General Fund $0 Scenario 2: Break -Even Program Fee w/ General Fund $144.71 $0 $148.24 $0 $140.57 1. The FY 2016 -17 Other Revenues are presented in a manner to be consistent with the County's preliminary budget. The four Projected Years include loan proceeds associated with two collection center construction projects under the Appropriated Fund Balance line item account. The four Projected Years also include contributions from equipment reserves as a separate line item account. Note that these items (loan proceeds and contributions from equipment reserves) were considered part of the Appropriated Fund Balance for FY 2016 -17, which was set to zero, and therefore are effectively excluded as Other Revenues within the model for that year. 2. FY 2017 -18 and FY 2019 -20 "Other Revenues" and "Total Revenues" "Total" Column cells include loan proceeds for convenience center construction of $804,784 and $904,255, respectively. These figures do not appear in the individual Division columns. 3. As a budgetary leveling exercise, SCS developed a methodology to present the net revenue and expense output by the Model as if the Program Fee contribution in the various Scenarios were disbursed evenly across all four Department Divisions, rather than solely through the Environmental Services Division. The "Leveling Factors" used for this exercise can be seen in Appendix E. F -1 Environmental Consultants November 2, 2016 File No. 02216202.00 MEMORANDUM 15521 Midlothian Turnpike 804 378 -7440 Suite 305 FAX 804 378 -7433 Midlothian, VA 23113 -7313 www.scsengineers.com T 0: Gary Donaldson, Orange County Gayle Wilson, Orange County FROM: Ryan Duckett, SCS Engineers Bob Dick, SCS Engineers SUBJECT: Solid Waste Enterprise Fund — Additional Considerations Orange County Solid Waste Financial Plan and Rate Study As an extension of the Orange County Financial Plan and Rate Study Final Report, developed by SCS Engineers and submitted to the County on October 13, 2016, SCS has prepared this discussion of issues that should be considered by Orange County as it addresses potential changes to the current financing methods for its existing solid waste and recycling programs. This memorandum presents some of these possible operational changes and offers examples of other municipalities' financial parameters as a benchmarking effort to increase perspective on a local, regional, and national scale. PROGRAM FEE SLIDING SCALE ASSESSMENTS SCS was unable to identify any municipalities within the US that apply solid waste program fee assessments utilizing a sliding scale approach based on the valuation of each assessed property. Based on our research and work experience for municipalities throughout the country, ad valorem (proportional to property value) methodologies are not utilized to vary the amount of a solid waste program fee paid by different property owners that receive consistent solid waste and recycling services. Generally, when an ad valorem revenue generation methodology is desired, funding is generated via the actual general property tax portion of the tax bill. A non -ad valorem special assessment is a charge (or assessment) against a specific parcel of property based on a specific benefit which the property has or will receive. In the case of Orange County, this type of assessment aligns with the Program Fee. BENCHMARKING OPERATIONAL RESERVES Most local governments do not have formal operational reserves or "rainy day" funds in the same way most state governments possess such funds. That is, a typical state government fund is governed by state law that sets a target fund balance and dictates when to use and replenish the balance. According to recent research, only 11 of the 30th largest cities in the U.S. have an actual Offices Nationwide MEMORANDUM to Orange Co. November 2, 2016 Page 2 rainy day fund. Instead, most local governments use budget surpluses or unreserved fund balances as a rainy day fund, but one without the constraints of a formal fund policy. Searching in the public finance literature for guidance when a jurisdiction wants to establish a policy on reserve fund balances can be confusing. Unlike state funds, local reserve funds for solid waste agencies, in SCS' opinion, are diverse and varied. It is not uncommon to see a group of solid waste agencies with a zero fiend balance and a nearly identical group of jurisdictions with fund balances at 70 to 80 percent of operational expenses. The average seems to be in the range of 15 to 25 percent of annual operational expenses, or 3 months of budget spending. The differences among municipalities and lack of benchmarking data seem to be centered on the following basic issues: • Political Decision Making — Politicians are bombarded with problems that an individual or an interest group wants solved on a short-term basis. Thus, most local solid waste agencies in the U.S. oftentimes fail to plan beyond 1 year at a time, particularly in terms of their budgets, which are universally annual budgets. Different Business Lines — Solid waste agencies differ in the types of business lines and service programs offered — some only deal with collection, or transfer station operations, or those that provide an integrated system (collection, recycling, transport, and disposal). Those with landfill disposal responsibilities oftentimes need to provide reserve funds for landfill contingencies (liner and contamination remediation emergencies, closure, and post closure). Some of these require state mandated reserve funds pursuant to state and federal landfill regulations. Revenue Stabilization — Many local solid waste agencies attempt to secure enough reserve funds to stabilize operational revenues to minimize the need for ever increasing rate increases. Based on SCS experience, there is no uniformity across the country for the level of these funds as a percentage of operational expenses. The amounts in these fiends are usually developed as part of overall rate study for the agency. Overall Community Financial Polices — Again, local communities vary in the types of standard financial policies related to their General Fund and Enterprise Funds. Based on our understanding, there are no uniform benchmarks across the country. Those with more conservative financial leanings tend to require their individual departments to match the requirements of the General Fund. For example, a recent rate study completed by SCS for a client in St. Louis, Missouri required the reserve fund for solid waste services to match the overall requirement of 100 percent of the annual operational expenses. In comparison, another rate study completed for a community in Virginia Beach, VA used a 25 percent reserve funds rate goal which aligned with that of the General Fund. MEMORANDUM to Orange Co. November 2, 2016 Page 3 Over the course of the development of the Orange County Financial Plan and Rate Study, the use of the Solid Waste Reserve Fund (Appropriated Fund Balance), as a source of revenue for the Solid Waste Department was projected as a short-term solution to balancing the budget and avoiding a deficit amounting to a significant portion of current revenues. SCS benchmarked the solid waste reserve funds of other Counties in North Carolina and on a national scale utilizing a twofold approach as follows: • SCS contacted Counties surrounding Orange County, specifically the counties of Wake, Durham, Chatham, Alamance, Caswell, and Person, and interviewed the appropriate staff directly regarding policies and practices related to solid waste reserve fund. SCS acknowledges that half of these Counties did not maintain a reserve fund specifically for solid waste activities. Refer to Exhibit 1 for a comparison of the solid waste reserves maintained by the various counties. • SCS gathered available public information on solid waste reserve funds held by a variety of municipalities on a national scale. Exhibit 1. Local County Reserves Assessment County Data Year Solid Waste Reserves (Millions) Reserves as % of Annual Expenses Wake Current $23.3 75 Alamance FY2016 $17.7 490 Orange Current $8.9 74 Chatham Current $3.21 100 Caswell FY2014 NA NA Durham Current NA (Env. Fund Only) NA Person Current NA NA Note: 1. Most recent number given by Finance Dept. SCS examined municipalities throughout the country with publicly accessible solid waste budgets and solid waste reserve quantities. These cities and counties represent the top municipalities found via an internet search of keywords "Solid Waste Reserve ". Note that data on this topic is limited and in some of the chosen cases data was not available for the present year; however, six of the eight examined municipalities had data available at least as current as FY 2015. Exhibit 2 below shows the reserves, solid waste expenses, and percentages solid waste reserve funds make up of solid waste expenses for the most recent year in which data was available. MEMORANDUM to Orange Co. November 2, 2016 Page 4 Exhibit 2. Solid Waste Reserves Assessment (National Scale) Municipality Data Year Solid Waste Reserves Expense Reserves as % of Expense Island County, WA FY 2016 Budget $8,642,147 $7,948,930 108.7 City of Weston, FL FY 2017 Adopted $2,032,491 $2,102,000 96.7 Orange County, NC FY 2016 -17 Adopted $8,867,042 $11,989,955 74.0 City of Porterville, CA FY 2016 -17 Estimate $3,562,164 $6,206,240 57.4 City of Franklin, VA FY 2015 -16 $560,000 $1,402,353 39.9 City of Kerman, CA FY 2014 -15 Projected $402,558 $1,074,135 37.5 City of Denton, TX FY 2015 Proposed $7,573,202 $27,802,592 27.2 City of Brentwood, CA FY 2012 -13 $2,763,641 $10,529,359 26.2 Fairfax County, VA FY 2010 $33,235,902 $128,922,894 25.8 Mean $7,776,741 $23,754,566 52.4 Median $3,562,164 $7,948,930 38.7 The data appears to indicate that most municipalities (that have them) maintain their solid waste reserves at a level between 25 and 50 percent of annual solid waste expenses. Outliers with reserve funds at or exceeding the annual levels of solid waste total spending may be attributed to programs with large, costly facilities requiring financial assurance or other contingency funds (for example, upcoming landfill closure). NC COUNTY SOLID WASTE EXPENSE ASSESSMENT SCS reviewed North Carolina county solid waste department budgeted expenses using information published on county websites in the form of the proposed budget, approved budget, or other financial documents. Using this information, solid waste department /program spending was calculated on a per capita basis. The results of this review are presented in Exhibit 3 below. A listing of basic services offered through each County solid waste program is included to enable a rough comparison of the value delivered per unit cost for each program. The presence of a County -owned revenue - generating disposal facility (such as a landfill or transfer station) in each County was also noted if applicable for comparison purposes to differentiate programs with solid waste fees that may be "subsidized" by such revenue - generators. MEMORANDUM to Orange Co. November 2, 2016 Page 5 Exhibit 3. NC County Solid Waste Expense Assessment Based on a cursory review of the results of this data - gathering exercise, in general it appears that solid waste spending per capita correlates with services offered and may be greatly affected by the presence (or lack thereof) of an MSW disposal facility such as a landfill or transfer station. FEE ASSESSMENT AND WASTE RECYCLING AND REDUCTION /DIVERSION RATE Local Program Fee(s) and Recycling Rate Assessment SCS contacted the solid waste departments of counties local to Orange County to obtain current program fees assessed and compare to the most recently - calculated (FY 2014 -15) waste disposal change from the FY 1991 -92 baseline in order to benchmark with Orange County's program. Solid Owns Waste MSW Data Expenses Solid Waste Disposal County Year (Millions) Spending /Capita Solid Waste Program Services Facility? SW & Recycling Drop -off (5 CCs & 5 Recycling Stations), Curbside Recycling Orange Current $12 $85 Collection, C &D LF, Environmental No Programming, MSW LF PCC, HHW Facility Chatham Current $3.2 $48 SW & Recycling Drop -off (1 1), Main No Recycling Facility Caswell FY2014 $0.8 $35 MSW LF, SW & Recycling Drop -off (9 Yes Sites) SW & Recycling Drop -off (1 1 Full Wake Current $14.8 $32 Service Sites, 6 Additional Sites), TS, Yes MSW LF, Closed LFs MSW LF, MSW TS, SW & Recycling Buncombe FY2017 $6.5 $26 Drop -off (at TS & LF), Friday HHW Yes Drop -off Alamance FY2016 $3.6 $23 MSW Landfill, SW & Recycling Drop -off Yes (3 Sites) SW & Recycling Drop -off (4 Full- Service Mecklenburg FY2017 $21.9 $22 & 8 Recycling Stations), "Compost Yes Central ", MRF, HHW Drop -off at CCs Randolph FY2017 $2.4 $17 SW & Recycling Drop -off (4 w/Fee & 2 Yes Recycling Stations), TS Person Current $0.5 $13 MRF/Drop -off Center No Davidson FY2015 $1.9 $12 SW & Recycling Drop -off (1 1 CCs), Yes MSW LF SW & Recycling Drop -off (4 Sites), Durham Current $2.3 $8 HHW Facility, Curbside Recycling No Collection Guilford FY2017 $1.5 $3 Scrap Tire and White Goods Collection Partnership Facility with City Based on a cursory review of the results of this data - gathering exercise, in general it appears that solid waste spending per capita correlates with services offered and may be greatly affected by the presence (or lack thereof) of an MSW disposal facility such as a landfill or transfer station. FEE ASSESSMENT AND WASTE RECYCLING AND REDUCTION /DIVERSION RATE Local Program Fee(s) and Recycling Rate Assessment SCS contacted the solid waste departments of counties local to Orange County to obtain current program fees assessed and compare to the most recently - calculated (FY 2014 -15) waste disposal change from the FY 1991 -92 baseline in order to benchmark with Orange County's program. MEMORANDUM to Orange Co. November 2, 2016 Page 6 Local counties contacted include Chatham, Durham, Alamance, Caswell, Person and Wake. Additional benchmarking data collected includes Total Public Recycling Rates on a per capita basis obtained from the NC Solid Waste and Materials Management Annual Report for FY 2012- 13 and the Waste Disposal Rate on a per capita basis obtained from the NC County Waste Disposal Report for FY 2014 -15. The results of this exercise are tabulated in Exhibit 4 below. Exhibit 4. Local County Recycling and Fee Assessment County Data Year FY 13 -14 Total Public Recycling Rate (lbs /person) FY 14 -15 Waste Reduction (compared to FY 91 -92) FY 14 -15 Waste Disposal Rate (tons /person) Total Residential Solid Waste Fee Durham Current 120.9 13% 1.02 $158.81 Chatham FY2014 85.7 39% 0.51 $125 Orange Current 273.5 64% 0.50 $107 Caswell FY2014 13.4 -318% 1.05 $84 Wake Current 137.8 22% 1.00 $20 Alamance FY2016 87.8 22% 0.71 $0 Person Current 117.3 -50% 1.20 NA Note: A negative value in the Waste Reduction column indicates an increase in waste disposal relative to the baseline year. The data shows that Orange County has achieved a level of waste reduction that is amongst the highest in the state, significantly higher than that of any local counties. This accomplishment was achieved despite its low solid waste assessed fee as compared to Chatham and Durham Counties. NC County Program Fee(s) and Recycling Rate Assessment Orange County provided SCS with data from the NCDEQ Division of Environmental Assistance and Customer Service listing North Carolina counties, their published fee amounts, and their most recently - calculated (FY 2014 -15) waste disposal change from the FY 1991 -92 baseline. Results of this exercise are shown in Attachment A. Note that some of the fee amounts listed in this analysis may differ from those shown in Exhibit 19 of the Financial Plan and Rate Study Report due to the methodology used to calculate the Solid Waste Fee (additional fees such as Recycling Fees and Collection Fees were added to the Solid Waste Fee to produce a cumulative rate for the Report exhibit). MEMORANDUM to Orange Co. November 2, 2016 Page 7 National Program Fee(s) and Recycling Rate Assessment Orange County not only maintains a level of waste reduction and recycling that is one of the highest in North Carolina, but it also has one of the strongest waste reduction and recycling programs in the nation. SCS examined other municipalities in the state and around the country that claimed a similar rate and compared the Orange County Program Fee to rates assessed by these other municipalities, which are outlined in Exhibit 5 below. For purposes of this exercise, counties and cities with recycling rates between 55 and 70 percent were considered comparable to Orange County. Note that it is difficult to control for the differing methodologies for calculating recycling rates across jurisdictions. Exhibit 5. Recycling /Diversion Rate and Fee Assessment (National Scale) Note: All Counties shown (other than Orange County) maintain solid waste curbside collection programs. Data is from FY 2016-17 for all Counties except Montgomery County, MD, the data for which is from FY 2015 -16. The data appears to indicate that populous counties with high reported waste recycling rates impose solid waste fees that are greater than that assessed by Orange County to pay for services offered. On the whole these counties appear to charge significantly more than Orange County; however, many offer curbside solid waste collection and it is difficult to determine the overlap of services offered by large urbanized areas within the examined counties. Total Residential Solid Residential Waste Rate Waste Fees Assessed Solid Solid Waste Disposal Municipality Name Rate (SCS Adjusted) Waste Fee Spending /Capita Facility? Disposal ($57 ) + Brevard Traditional Collection ($128.21) + $106,765,144/550,823 County, FL Recycling 58% Impact ($160 ) [Excludes $345 = $193 Landfill Rate Solid Waste Collection Fee] Prince George's MRA Rate 59% Solid Waste Services $319 $97,625,100/890,081 Landfill County, MID Charge $110 = $110 Disposal Charge ($49.52) Montgomery Waste Diversion o 62% + Base System Benefit Charge ($29.71) + $205 $106,157,817/1,017,000 Transfer County, MD Rate Incremental Systems = $104 Station Benefit Charge ($125.88) Collier Traditional Disposal and Admin Fees: $64,668,500/339,642 County, FL Recycling 56% District 1 ($188.29) $183 = $190 Landfill Rate District II ($177.34) Charlotte Traditional Standard Sanitation Fee ($12,842,747 + County, FL Recycling 59% ($148) $148 $27,208,798)/164,736 Landfill Rate = $243 Waste Orange Reduction o 64 /o Program Fee ($107) $107 $11,989,955/140,352 NA County, NC & Recycling = $85 Rate Mean 60% $218 $147 Note: All Counties shown (other than Orange County) maintain solid waste curbside collection programs. Data is from FY 2016-17 for all Counties except Montgomery County, MD, the data for which is from FY 2015 -16. The data appears to indicate that populous counties with high reported waste recycling rates impose solid waste fees that are greater than that assessed by Orange County to pay for services offered. On the whole these counties appear to charge significantly more than Orange County; however, many offer curbside solid waste collection and it is difficult to determine the overlap of services offered by large urbanized areas within the examined counties. MEMORANDUM to Orange Co. November 2, 2016 Page 8 REFERENCES Marc Rogoff, Solid Waste Rate Setting and Financing Guide, Kansas City: American Public Works Association, 2007. 2. Marc Rogoff, Solid Waste Recycling and Processing, Second Edition, Elsevier, 2014. 3. Marc Rogoff and Laurel Urena, The Use of Special Assessments for Solid Waste Management, Florida American Public Works Association Reporter, Winter 2017 (in press). 4. Justin Marlowe, What's the Point of Rainy Day Funds, Governing, June 2013. 5. Various Municipal Websites. Pender Columbus Washington Northampton Tyrrell Halifax Madison Gates Carteret Martin Chowan Pasquotank Durham Perquimans Hertford Bladen Ashe Chatham Warren Rutherford Polk Hoke Orange Vance Nash Haywood Robeson Lee Edgecombe Duplin Beaufort Watauga Lenoir Jackson Caswell Greene Lincoln Granville Swain Cherokee Macon Pitt Harnett Stanly Johnston Cleveland Burke Yadkin Alleghany Franklin lredell Cumberland Wayne Craven Wilson Surry Currituck Wake Caldwell Mecklenburg Richmond Attachment A NC County Program Fee and Recycling Rate Assessment Waste Quantity Change from FY 1991 -92 to FY 2014 -15 -100% -50% 0% 50% 100°% $0.00 $50.00 $100.00 $150.00 $200.00 $250.00 $300.00 Solid Waste Fee (FY 2014 -15) Note: Negative waste change values indicate a decrease in waste production relative to the FY 1 991 -92 baseline. Pender Columbus Washington Northampton Tyrrell Halifax Madison Gates Carteret Martin Chowan Pasquotank Durham Perquimans Hertford Bladen Ashe Chatham Warren Rutherford Polk Hoke Orange Vance Nash Haywood Robeson Lee Edgecombe Duplin Beaufort Watauga Lenoir Jackson Caswell Greene Lincoln Granville Swain Cherokee Macon Pitt Harnett Stanly Johnston Cleveland Burke Yadkin AI l egha ny Franklin Iredell Cumberland Wayne Craven Wilson Surry Currituck Wake Caldwell Mecklenburg Richmond $268.0 -28 -2 -38% -26 -27 -31% -29% -25 -2 -39% 7% $218.0 $215.00 $204.50 $200.00 89.75 .00 -87% - 6 % 15% $ $18 $18().00 $18().00 5172.(0 $168.0 144.00 39.00 DO 13% 7% 13% 1% % $ 5130.00 $130.00 $13().00 $130.00 $125- $120.0 $120.0 $110.00 $110.00 $107.00 $105.00 $96.00 92.00 0.00 0.00 0.00 W.00 0.00 9% 43% -39% 4% -20% -27 -17% -Z5 -40% -25% -47 -34 -38% -38% -31% -,8% -48% -21% -32% -39% -39% -22% 64 a 4% 14% "o 15% 6% -8% -11% 17 $ $ $ $ $87.00 $82-.00 $8A.00 $84.00 $82-00 $8100 $8100 $75.0 $75.0 $72.0 $71.0 $70.00 $69.00 $65.00 $62.00 $60°60 $60.00 $60.00 $55.00 $52.00 $48.00 45.00 .00 318% 14% 7% 4% 20 99% 13% -8% 40% 36-00 $3 $30.00 $25.0 $20.00 $17.75 $15.00 $14.00 9% -5% -11% 44% $0.00 $50.00 $100.00 $150.00 $200.00 $250.00 $300.00 Solid Waste Fee (FY 2014 -15) Note: Negative waste change values indicate a decrease in waste production relative to the FY 1 991 -92 baseline. Pender Columbus Washington Northampton Tyrrell Halifax Madison Gates Carteret Martin Chowan Pasquotank Durham Perquimans Hertford Bladen Ashe Chatham Warren Rutherford Polk Hoke Orange Vance Nash Haywood Robeson Lee Edgecombe Duplin Beaufort Watauga Lenoir Jackson Caswell Greene Lincoln Granville Swain Cherokee Macon Pitt Harnett Stanly Johnston Cleveland Burke Yadkin AI l egha ny Franklin Iredell Cumberland Wayne Craven Wilson Surry Currituck Wake Caldwell Mecklenburg Richmond Memorandum To: Solid Waste Advisory Group (SWAG) From: Gayle Wilson, Solid Waste Director Subject: Mattress Disposal Date: September 16, 2016 75 At the Board of Commissioners' (BOCC) request a memorandum (attached) was prepared offering options for improving the county's mattress disposal program. It was believed by some commissioners that our program was not providing the level of service necessary for the residents across the county and that this insufficient level of service was resulting in mattresses being illegally dumped. The original memorandum noted that staff was unable to verify that such illegal dumping was taking place in any substantial way, however the BOCC wanted to consider options for improvement anyway. Several options were presented to the BOCC and discussed at their June 9 budget work session. It was noted by one or more commissioners that the options presented to make program improvements were too costly and that there had to be other less costly options. It was suggested that staff could use seasonal labor or interns. It was also suggested that the existing Waste & Recycling Center staff could perform the handling of the mattresses. Further, it was noted that sheds could be constructed in which residents could place their mattresses. These suggestions were previously considered and were somewhat problematic. Staff has however, developed two additional options (one a variation of the original 1a), but they also have costs that may exceed BOCC expectations. Staff wishes to reiterate that mattresses are a special waste material that requires special handling, even more so for recycling them, so it is difficult to avoid increasing labor costs for increasing resident convenience and availability. Handling large and sometimes wet mattresses are also physically demanding. 1aa — Permanent mattress disposal at Walnut Grove and Eubanks Waste & Recycling Center This option provides a permanent mattress disposal option at both of the District Waste & Recycling Centers (W &R Center), in addition to the existing landfill location Details: a. During existing landfill facility hours (7 am -3 pm weekdays and 8 am -noon Sat) mattresses /box springs would be received just as we do now (not at the Eubanks W &R Center) except that mattresses coming from residents will not be charged the fee even though they'll have to cross the scales; only non - residential mattresses (UNC or apartment management companies for example) will be charged $10 /unit b. When the landfill facility is closed (after 3 pm weekdays and noon on Saturdays; and Sundays) residents may bring mattresses to the Eubanks Rd. W &R Center 76 L Mattresses delivered to the landfill facility will be recycled as they are now if clean and dry ii. Mattresses delivered to the Eubanks W &R Center will be hauled to the transfer station c. Walnut Grove would receive mattresses during all of its current operational hours and the units will be hauled to the transfer station and not recycled d. Mattresses delivered to the Eubanks W &R Center during landfill facility hours will be redirected to the landfill (no charge) e. Eubanks W &R Center will not accept mattresses until the new center is constructed an open for business f. No fee will be charged to residents at either Eubanks or Walnut Grove W & R Centers or at the landfill location g. Fee will be charged to non - residential customers at landfill location; non - residential customers are not authorized to use W &R Centers Estimated Operating Cost for FY 16/17: $35,566 Includes signage, advertising, additional hauling and tipping fees, increased non - permanent staffing Capital Cost: $9,294 One time purchase of two (2) 30 yard roll -off containers Accept mattresses at Eubanks and Walnut Grove W &R Center only on Fridays, Saturdays and Sundays This option provides permanent weekend only mattress disposal service at both of the District W &R Centers. Mattresses delivered to the Eubanks W &R Center during landfill facility hours would be redirected to the landfill (no charge) Eubanks W &R Center would not accept mattresses until the new center is constructed and open for business a. Walnut Grove would receive mattresses Fridays, Saturdays and Sundays b. Mattresses delivered to either of the two (2) W &R Centers would be hauled to the transfer station and not recycled c. During existing landfill facility hours (7 am -3 pm weekdays and 8 am -noon Sat) mattresses /box springs would be received just as we do now (not at the Eubanks W &R Center) except that mattresses coming from residents will not be charged the fee even though they'll have to cross the scales; only non - residential mattresses (UNC or apartment management companies for example) will be charged $10 /unit d. When the landfill facility is closed (after 3 pm on Friday and noon on Sat; and Sunday) residents may bring mattresses to the Eubanks Rd. W &R Center i. Mattresses delivered to the landfill facility will be recycled as they are now if clean and dry 77 ii. Mattresses delivered to the Eubanks W &R Center would be hauled to the transfer station e. Mattresses delivered to the Eubanks W &R Center during landfill facility hours by residents would be redirected to the landfill (no charge) f. Eubanks W &R Center would not accept mattresses until the new center is constructed and open for business g. No fee would be charged to residents at either Eubanks or Walnut Grove W & R Centers or at the landfill location h. Fee would be charged to non - residential customers at landfill location; non - residential customers are not authorized to use W &R Centers Estimated Operating Cost for FY 16/17: $33,955 Includes signs, advertising, increased hauling and tipping fees, increased non - permanent staffing Capital Cost: $9,294 One time purchase of two (2) 30 yard roll -off containers By continuing to use the existing landfill facility mattress disposal /recycling location during landfill hours costs have been reduced for handling mattresses at the centers as per the original memorandum. It is staff's desire to obtain input from the SWAG on this topic. Attachment: Original Memorandum of May 27, 2016