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HomeMy WebLinkAboutSWAB minutes 121202 Solid Waste Advisory BoardammoRegular Meeting December 12 , 2002 Government Services , Hillsborough Approved January 9 , 2003 The Orange County Solid Waste Advisory Board met on December 12 , 2002 at the Government Services Building in Hillsborough at 6 : 00 p . m . A light dinner was provided . Members in attendance were : Jan Sassaman ( Chair) Remus Smith, Albert Vickers . Also attending were , BJ Tipton (UNC) , Barry Jacobs ( Commissioner , liaison) Phil Prete (Town of Carrboro staff) . Orange County staff in attendance : Gayle Wilson, Rebecca Holdway , Blair Pollock, and Mary Watkins . Others included : Joe Cook and Jeff Hughes from the Institute of Government . Special guest : Torn Smith from Prince William County , VA . The meeting was called to order by the Chairman at 6 : 15 p . m . Jan announced the resignation of Brian Ketchem , Hillsborough Representative . Absent a quorum, no votes were taken and this meeting served as a working session of the Board . 1 . Adoption of Minutes from October loth and November 14th Meetings . The Minutes of October and November were tabled due to the lack of a quorum . 2 . Report re : Feedback from Carrboro regarding process for proceeding with County Commissioner review and obtaining input from towns and public . Jan Sassaman noted that the second item of business was that each representative was going back to their respective jurisdictions to get feedback talking with Town manager or elected officials on what we are doing and get ideas on what they wanted us to do . Carrboro was supposed to give this report but will be postponed until next meeting . 3 . Non -Residential Fee Issues — Prince William County Virginia Experience — Tom Smith , Solid Waste Division Chief. Jan introduced Tom Smith, Division Chief of the Solid Waste Management of Prince William County , VA . The members of the SWAB board introduced themselves to Mr . Smith . Mr . Smith gave a presentation on his experience and Prince William County ' s experience in developing a fee structure to finance their Solid Waste operations . Every community is different . The situation in Orange County is probably different from Prince Williams ' s but at least you can get an idea on the thought process we (Prince William) went through to end up were they how have a Solid Waste user fee which is billed to every property in the County [including non -profit agencies ] . Prince William County is a suburb of Washington, DC ; located about 30 smiles south . I - 95 goes through the County . There is a mix of residential and retail properties , including about 60 % residential , 40 % business type properties . We are trying to attract high-tech companies . AOL is in the County , which may be good or bad , depending on how you look at it . There are 300 , 000 residents and it ' s growing . The government is an elected county board , 7 districts and one at- large ( eight-member board) . Each board member has an equal vote , under an appointed county executive form of government . 1 Solid Waste Advisory Board- - Regular Meeting December 125 2002 Government Services , Hillsborough Approved January 9 , 2003 Prince William County began operating the landfill in 1969 as one of the first permitted landfills in the State of Virginia . One of the differences between Prince William and Orange is that all the collections including both residential and commercial are done by private companies . There are no municipal (public) collections of waste . Two cities located within the county are totally independent from the county . They have their own tax rate , their own planning office , etc . They handle their own waste as they see fit . [They do not pay the County' s waste assessment fee . ] ided to expand the existing landfill . The county purchased In 1988 the county dec approximately 800 acres of land bringing the site to almost a thousand acres . To do that, the county had to borrow money as a revenue bond for $ 123 million, of which $ 18 million is still outstanding . We have an integrated system, similar to most governments who have recycling programs and yard waste programs . We have a unique situation with Fairfax County to our north, where we utilize a new waste energy facility . We work together on yard waste compost . We have a regional yard waste compost facility where Fairfax County brings yard waste to Prince William and Prince William ' s trash goes to Fairfax waste facility for disposal . It ' s called the 'trash trade ' . When we expanded the landfill we wanted to have a long -term solution, so we made plans to extend the landfill to 2050 . We had gate fees to cover the entire system . The County ' s tipping fee covered the recycling program (dropoff sites and materials recovery facility but no curbside) , household hazardous waste program and the yard waste program . The fee covered everything . That was the primary source of revenue . The county did have a flow control ordinance which required that all trash generated within the county would be delivered to the county landfill , which fell apart due to a Supreme Court decision [ Carbone 19961 . The City of Manassas within the county decided to go its own with trash disposal . They allowed Waste Management to build a transfer station within that city . The large [privately owned] landfills located south of the county and central Virginia were developing . The County began to lose trash to other facilities . With the loss of trash flow, the landfill tipping fee revenues begin to drop . The number of haulers dropped from 19 down to 6 . The big guys were buying up the little guys . Four big haulers and two little ones survived this crisis . Working with two citizen committees (one is made up of representatives of each jurisdiction of the county and the other with one with citizens who live around the landfill) whose primary issues were the landfill and how it operates . These committees recommended that the County (for the short-term) import trash . The rates were dropped , trash flow increased and the revenue increased enough to pay the bills . Trash was imported from as far away as New York, Pennsylvania, Maryland and the District of Columbia . Trash could be intercepted off I - 95 before going to the southern landfills . A 2 Solid Waste Advisory Board - - Regular Meeting December 12 , 2002 Government Services , Hillsborough Approved January 9 , 2003 marketing person was hiring to Help bring in trash, which actually produced more revenue for the County . We looked at several long -term options for the landfill : ( 1 ) Get out of the business and sell ; (2 ) Lease out the operation to the Private sector ; (3 ) Close the landfill altogether ; (4 ) Consider alternative funding ; ( 5 ) Generate Fees and (6) Impose a tax levy . We developed pros and cons with each citizen committee for each option . 1 . Our citizens did not want to sell the land because they would lose control . 2 . The Private sector operator — they did not see that that solves the problem (the County would incur similar costs as before and the private contractor would still likely want to import trash to malice the money) . 3 . Close the landfill — there would still be debt payment to worry about, there would be closure cost, the landfill would be closed earlier than anticipated due to increased waste brought in . 4 . 5 , or 6 The Countywide user fee , the biggest con was this new fee on the tax bill . Many elected officials would think negatively about adding such a fee . This would be a new fee that would be added to the tax bill . With the options available , the two committees conducted surveys with the private sector businesses , meet with the Chambers of Commerce , held public meetings , and met with several Homeowners Associations . Flyers were made available at the Public Library to let them know the options and situations . The feedback from citizens was : ( 1 ) the importing of trash and what is it going to do to the life of the landfill . (2 ) Would a fee imposed to cover landfill costs affect the prices changed by the private haulers (3 ) charge a fee or tax just to cover the landfall , (4) why should the county be in this business . After further discussions with the Board , four options were considered . With the four options a matrix was developed with each of these issues that were expressed as concerns or impacts from the citizen ' s ( 1 ) Solid Waste Fee — keep the truck traffic local (i . e . don 't import trash) . If the fee was left at $ 70 . 00 (per household) with no tipping fee . One of the benefits of having this fee would be to stabilizing the revenue . (2 ) Continue to import trash and keep the higher volume of truck traffic . The larger haulers haul more trash and charge higher prices . The smaller guys have nowhere else to go . ( 3 ) Blended User Fee — where some of the cost would be added to the tax bill but some fees would still come from the landfill . The larger haulers liked this idea . (4 ) General Fee Subsidy - tax increase or levy 5 % on the assessed value for the property . A couple of public hearings were held before the Board of Supervisors . This plan was worked on for 2 1 /2 years before it was presented . Most citizens supported keeping the landfill . Other systems were researched which both had generator fees . We worked very closely with the County Attorney ' s office for legal advice . The rate was based on a single family home as the primary measure of waste generation . The amount of waste generated for a single family home . Each home on an average generates a total of 1 . 3 tons of trash each 3 Solid Waste Advisory Board- -Regular Meeting December 12 , 2002 Government Services , Hillsborough Approved January 9 , 2003 year . Finally a decision was made to bill all the non- residential facilities . A survey was sent to each large business facility on how much waste was generated in a year . It was estimated on the usage from the businesses where they did not respond to the survey . In order to do the solid waste billing , the computerized financial billing system had to be upgraded to go along with the assessment system of the county in order to generate fees to be taxed . It took about 2 1/2 years to go through the entire process of setting this up , with how much to charge on the tax bill , getting the system up and running with the finance office and the assessor ' s office . All the long-terms options were evaluated before settling on the one that would be suitable for the county . Every inhabitable structure gets billed . The county implemented a user fee , which was approved by the state . An ordinance was developed to implement the fee structure . Questions were asked of Mr . Smith to differentiate between townhouses and an apartment attached to a house . He explained that duplexes are a single - family dwelling and each dwelling was taxed as such . An adjustment can be made if a building is vacant for at least 6 months out of a year . The owner must apply for the adjustment In his conclusions Mr . Smith recommended that the SWAB board look at as many options as possible . Never say " it won ' t work" . Try to look at all options . Make sure that you have , as many citizens as possible are involved as they are all stakeholders in this process . This will not be an easy issue , since you are thinking of attaching another fee to whatever is already assessed . Evaluate all the options . Get the media involved . Understand your politics . Consider what is best for the county . What does it cost to run the landfill ? Have the citizens understand that whomever benefits from the system should pay for it . Think long -term . Comments and questions were solicited from the board [ and staff] . Gayle Wilson asked how many counties around the nation are having the same problem . Mr . Smith responded he did not know the figures , but there are a lot . Mr . Smith explained that every drop is taxable . An ordinance is in effect in VA to get the fees and who will pay . Every hauler is charged fee . A lengthy discussion followed with questions how the Virginia system is handling card board , plastic bottles , metal , etc . It was also asked how the landfill is operating at this time . Mr . Smith stated that it is now operating on a 32 % basis and the goal is 40 % . Haulers are being fined $ 1 , 000 per violation if they are caught hauling waste in from out of county illegally mixed with in- county waste . Citizens are involved and will patrol the landfill for non- compliance and will report the violator . It was noted that the only facility not being serviced is the [Quantico ] Marine base , they dispose of their own waste . 1 . Alternative Financing recommendations — SWAB Process and Schedule for Reporting to Board of County Commissioners . Jan stated that he met with Mr . Jacobs last month to 4 Solid Waste Advisory Board- - Regular Meeting December 12 , 2002 Government Services , Hillsborough Approved January 9 , 2003 find out his opinion on what the SWAB is thinking . We talked about trying to get closer communication with the Commissioners . Barry suggested that we get up a work session with the Commissioners . The very earliest would be January . Barry suggested that at the work sessionswe walk the Commissioners through the process . Barry also suggested that we also have the County Attorney attend these meetings to get his input on how to proceed and advise us on legal questions . Jan suggested that Gayle be responsible for getting the County Attorney to the next meeting . Gayle responded that he would ask, but the Commissioners would be the ones that would make sure he was in attendance . One of the things Jacobs and Sassaman discussed was the 61 % recycling goal and as a [ SWAB ] board we have officially put our stamp on that percentage . I got the sense that the BOCC ) board was pretty much committed to that goal . We are talking about a goal — something that we are going to shoot for . We talked about the timing and implementation of that goal . How pushing the implementation back later on in time would affect our fiscal needs . We talked then about the analysis as it was last month with two basic scenarios ( a) looking at scheduled implementation somewhat later than was originally planned and (b) 61 % by the year 2006 was probably not within the ream of the achievable . Barry suggested that we develop a chart showing a continuum of where we are now at approximately 45 % recycling up to 61 % . Show the mechanisms needed for each incremental increase in recycling such as the MRF , new programs , pay as you throw, etc . At each incremental step show the reduction and the cost of each incremental reduction . We talked about our need to get a better sense of what the Board of Commissioners wanted in general . Barry suggested that we prepare a semi - annual report to the Board and use that as an opportunity to let them know what we are doing and to provide a vehicle for a dialog with them and finally he indicated that the Board would probably like to see a calculation about any fees that we would suggest that we would recommend such as availability fees , taxes , etc . for the solid waste operations would relate to the overall tax rate . Mr . Jacobs stated that the Board had not discussed much in the way other than operational decisions . We have not had much of philosophical discussion about anything related to solid waste . We talked about the purchase of a grinder and implementing the [regulated recyclable materials ] ordinance , but we haven ' t looked at a big picture level since a recommendation was made not to hire a consultant , which was a year ago . That was why I suggested a work session with the Commissioners to get them up to speed on what is happening . Jan asked Gayle what he thought would be the best approach for the work session . Gayle it would be February before we would be ready to have a responded that he thought discussion with the Board of Commissioners and be reasonably prepared to answer a lot of the questions that we would expect them to ask and we can ask the University (Environmental Finance Center , i . e . Jeff Hughes , Joe Cook) to present with us . Gayle 5 Solid Waste Advisory Board- - Regular Meeting December 12 , 2002 Government Services , Hillsborough Approved January 9 , 2003 reiterated that he thought February would be the best month to talk with the Board and receive further direction and guidance and summarize the work we have done so far and review its assumptions . We can talk about the plan and its impact and its cost . Most importantly , the consequence of doing nothing in next years solid waste budget . If we had a meeting with the Board of Commissioners and the only point we were able to make was that without some reduction in services we couldn ' t continue at the current rate without some type of additional income . The Board may proceed to show interest in one of these scenarios [implementing the plan or continuing status quo ] and proceed toward implementation or they may say we like this , " It is too complicated . What can we do to buy us time to work through the details ? " or they may say [for example] , " Gayle , cut your budget $ 800 , 000 next year because you don ' t have the money . " We do need to have a meeting with them and show them where we are financially . We haven ' t had a talk with them in some time and frankly the staff is interested in what they are thinking . Mr . Jacobs gave the dates for the scheduled work sessions . He stated that if we wanted to make budget statements that would affect next fiscal year , the Commissioner would like to make decisions as early as * possible depending on the new sales tax . Gayle stated that February 26"' would be good timing for SWAB to attend the Board of County Commissioners work session . Mr . Jacobs suggested that Gayle contact the Assistant County Manager about this date for scheduling SWAB attendance at the meeting . It was the consensus of the SWAB that they would made a presentation to the BOCC in which it would be explained in detail the purpose of the MRF , the necessity for it { if the waste reduction goals are to be met] and its capabilities , how it would be different from the [failed] one in Alamance County . Mr . Jacobs added that we need to sell the Commissioners on this . It was also suggested that the information to the Commissioners be very thorough and precise and to leave no stone unturned . Al Vickers suggested that of the issues before the board it would be difficult to know which items to cut . He suggested that a discussion of the following would be helpful ( 1 ) the current solid waste management plan , implementation, cost (2 ) minimal cost of maintaining the status quo without increasing recycling and just trying to hold where the county is , (3 ) what level of collection and processing it would take to achieve the goal in the solid waste management plan . This would show what the enhanced processing facility [MRF ] would be giving you in accomplishing the goals . 4 . Continuation of discussion of non - residential funding scenarios and customer group impacts . Joe Cook (Institute of Government) distributed a handout for the meeting which contained the following information Scenarios for December 12 , 2002 SWAB Meeting 6 Solid Waste Advisory Board - - Regular Meeting December 12 , 2002 Goveriu-nent Services , Hillsborough Approved January 9 , 2003 The document outlined several different alternative - funding scenarios for the Orange County Solid Waste Department for the fiscal years 2003 - 04 to 2010 - 11 Scenarios Presented : 1 . No new sources of revenue (move to deficit or very high (theoretical ) tipping fee . 2 . Fees or taxes change each year to balance the budget in that year . 3 . Property taxes increase in 03 - 04 , but no fees . 4 . Availability fees are implemented in 03 - 04 , but no property taxes . 5 . Property taxes increase in 03 - 04 to cover general services , but availability fees are implemented cover all other specific service areas e . g . curbside recycling , multifamily , rural curb , commercial . . 6 . Availability fees are implemented in 03 - 04 , but no property taxes . Fees are raised in 09 - 10 to balance the budget [because landfill closure costs combined with loss of landfill revenues drives ' deficit ' higher at that point . ] Assumptions : 1 . Service Level "A " — expansion of rural curbside service , MRF , commercial recycling expansion, etc . that is the implementation of the plan to meet/approach the goal 2 . Landfill Closure Fund — begin separate sinking fund contributions start in 02 - 03 to cover projected closure costs in 09 - 10 ($ 2 . 513 million) 3 . Greene Tract — OCSW receives reimbursement for southern Greene Tract in 3 equal installments ( $ 272 , 253 ) in 04 - 05 , 05 - 06 and 06 - 07 . Revenue from the Greene Tract reimbursement is contributed to the Landfill Closure Fund, lowering the contribution needed and thereby lowering the proposed general service fee . 4 . The total assessed value of taxable properties increases 2 % per year . 5 . The number of all customers is assumed to grow at 2 % per year . Though the total number of rural households is assumed to grow at 2 % per year, the percentage of these households that receive curbside service jumps dramatically 2006 - 07 as a result of aggressive expansion of recycling services from the 40 - 50 % that now receive service to as physically close to 100 % as achievable , some units will remain unserved due to inaccessibility . 6 . According to the OC Tax Assessor ' s office , there are 121 mobile home parks in the county with approximately 2 , 510 spaces . Assuming a 7 % vacancy rate , we assume that there are 2 , 334 mobile home customers in the county . For now, they are all assumed to be in the unincorporated area, and since they will likely receive service as a multifamily customer, they are included in the count of unincorporated multifamily customers . NOTE : This has been amended to include these customers as rural single family curbside customers . 7 . Although projections are based on 2002 - 03 data, any new sources of revenue would begin in 2003 - 04 . 8 . An important change from previous projects is the estimated fund balances . Previous models showed a beginning fund balance in 2002 - 03 of $ 3 . 14 million . The most recent county budget shows that approximately $ 3 million will be appropriated from the SW fund balance , 7 Solid Waste Advisory Board- -Regular Meeting December 12 , 2002 Government Services , Hillsborough Approved January 9 , 2003 leaving only approximately $ 140 , 000 remaining as the beginning fund balance for 2003 - 04 . To be conservative , we assume a 03 - 04 starting fund balance of $ 300 , 000 , split equally between the equipment reserve and the solid waste fund . Scenario 1 : What is the effect of a sinking fund to cover landfill closure costs ? A graph showed the cash flow deficit for two different situations . Both assume no new sources of revenue . The first is the situation presented to SWAB at the last meeting — without a landfill closure fund . The second situation assumes that , beginning in 2002 - 03 , the department begins saving for the landfill closure expense , estimated at $ 2 . 513 million in 2009 - 10 . It was also noted that reimbursements for the southern Greene Tract are put into this sinking fund to reduce the contributions . The graph showed that the sinking fund increases the deficit over the period 2002 - 03 to 2008 - 09 , but avoids part of the much bigger deficit spike in 2009 - 10 . Specifically , it avoids the $ 2 . 5 million landfill closure costs , but does not avoid the approximately $ 1 . 7 million deficit that is primarily due to lost tip fee revenue when the landfill closes . This again points to the need for some alternative sources of revenue . Scenario 2 : What fees or property tax increases would be necessary each year to balance the budget? The table on the handout showed what fees would be for a particular type of customer in order to balance the budget each year . For example , an urban curbside customer in 02 - 03 would pay $ 3 . 16 for general services (administrative , landfill , hazardous waste , etc . ) and $ 55 . 96 to cover urban curbside services , a total of $ 59 . 12 . It was noted that fees jump in 2009 - 10 because of lost tip fee revenue coupled with landfill closure . Another table in this scenario showed the amount that proper taxes would need to be raised to substitute for the service area [availability] fees calculated in the previous table . For example , if it were decided to cover urban curbside services with a general property tax increase while charging availability fees for all other service areas , the County would need to raise property taxes by $ 0 . 0101 per $ 100 of property value . This is the equivalent of charging all urban curbside customers $ 59 . 12 . Scenario 3 : Increase Property Taxes in 2003 - 2004 , No Availability Fees . This chart showed a property tax increase in 2003 - 04 which equals $ 0 . 0302 $ per $ 100 evaluation . Property taxes are raised once , in 2003 - 2004 to cover all solid waste program deficits . The property tax increase needed to balance the solid waste budget actually fluctuates , but the county commissioners [practically] cannot adjust taxes each year, therefore one needs some sort of average . Looking back at scenario 2 , you can see that the property tax increase needed to cover all services jumps dramatically in 200940 (from $ 0 . 0364 to $ 0 . 0531 ) because of the loss of landfill tip fee revenue . This scenario assumes that , rather than generate too much revenue during the first six years that won' t be spent until the eighth year , a second tax increase will need to be made in 200940 . Thus , the tax increase in 2003 - 04 is set as the average of the increases needed over the period 2003 - 04 to 2008 - 09 . 8 Solid Waste Advisory Board- - Regular Meeting December 12 , 2002 Government Services , Hillsborough Approved January 9 , 2003 Because the property tax increase is an average , half of the period (03 - 04 to 05 - 06) , the property tax increase would generate some excess revenue that increases the size of the solid waste fund . From 06 - 07 to 08 - 09 , though, this tax increase is insufficient to balance the budget and the cash flow is in deficit . The solid waste fund built up over the previous three years is used to cover this deficit , though, and remains at a healthy 26 % of expenditures at the end of 08 - 09 . In 2009A 0 , the fund balance is completely depleted , and another tax/fee increase would be necessary . Scenario 4 : Implement availability fees in 2003 - 2004 , No property tax increase . This table shows that County implementing availability fees in 2003 - 04 and does not increase property taxes . The fees were chosen, as the average fees needed to balance that service area ' s budget over the period 03 - 04 to 08 =09 . Fees were then rounded up to the closest $ 0 . 50 (for example , $ 64 . 15 is rounded up to $ 64 . 50 ) . It is assumed that fees/taxes would need to be increased again in 09 - 10 . The . solid waste fund balance grows over the period 03 - 04 to 06 - 07 , and is enough to cover the deficits in 07 - 08 and 0 & 09 . The deficit spikes in 2009405 though, and the solid waste fund is depleted . Another fee increase would be needed at that point . Scenario 5 : Increase property taxes in 2003 - 04 to cover general services , implement availability fees in 2003 - 04 . This table showed property taxes are increased in order to cover the general services , but availability fees are charged for all other services areas . Again, the tax increase and the fees were calculated, as the average of the tax/fee needed to balance that service area ' s budget from 03 - 04 to 08 - 09 . Neither fees nor taxes are raised again , though the fiscal situation gets much worsen in 0940 . Scenario 6 : Implement availability fees in 2003 - 2004 Raise Fees in 2009 - 10 , No property tax increase . The table assumes that availability fees are implemented in 03 - 04 and raised again in 09 - 10 . Property taxes do not increase . The initial fee is calculated as the average fee needed over 03 - 04 to 08 - 09 , and the fee increase is calculated, as the average fee needed in 09 - 10 to 10 - 11 . A lengthy discussion followed on how these scenarios could be presented to the Commissioners in a way they will understand what Solid Waste is trying to do and how it will be done . It was the general consensus that this would be presented on January 26t" to the Commissioners . A presentation similar to the one presented by Prince William County will be presented at the next meeting for critique for the work session with the BOCC . The meeting adjourned at 9 : 10 p . m . The next meeting is scheduled for Thursday January 9 at Southern Human Services Center on Homestead Road at 7pm . 9