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<br />SOLID WASTE WORK GROUP SWCC RECOMMENDATIONS
<br />MOVING FORWARD -THE ENTERPRISE FUND AND A HOUSEHOLD FEE
<br />In arriving at its final recommendation, the Work Group considered different funding
<br />approaches and has recommended reliance on an annual household fee, tied, if possible, to the
<br />current 3-R Fee billing structure (aka a "4-R" fee) that would cover SWCC operation and capital
<br />requirements for upgrades integrated into the current Enterprise Fund approach.
<br />The recommendation includes moving towards complete independence from the General Fund
<br />(GF) -either immediately (as shown in Table 4 below) or over amulti-year transition period
<br />(shown in Table 6 below). Notes on each of the line items in these two tables are provided
<br />below as well. The primary difference between the two is the amount of funding sourced from
<br />the recommended per household fee.
<br />Table 4 shows the 7-Year Enterprise Fund forecast for the SWCC system with no General Fund
<br />contribution at all -starting in year 1. The bottom line shows the potential drop in General
<br />Fund support achieved for each year, with current year GF support as the baseline, and then
<br />the GF support drop shown cumulatively over the 7-year period.
<br />Table 4: 7-Year Enterprise Fund Forecast for Final Recommendation
<br />with No Ge~aeral Fund Support - GFEliminated in Year 1
<br /> Sanitatom
<br />FY 2011/12 Sanitation
<br />FY 2012!13 Sanitation
<br />FY 2013114 Sanitation
<br />FY 2014115 5anltation'
<br />FY 201511& Sanitation
<br />FY 2016f17 Sanitafion
<br />FY 20171 8 Note
<br />s
<br />Targeted Expenses
<br />-Operating $2,160,312 $2,323,518 $2,427,569 $2,514,388 $2,578,063 $2,655,405 $2,735,067 #1
<br />-New Capital Debt Retirement $364,360 $364,360 $364,360 $364,360 $364,360 $364,360 $364,360 #2
<br />Expenses Total $2,524,673 $2,687,878 $2,791,929 $2,878,748 $2,942,424 $3,019,766 $3,099,428
<br />Targeted Revenues
<br />-Current 3-R Fee $261,000 $261,000 $261,000 $261,000 $261,000 $261,000 $261,000 #3
<br />-Fixed General Fund Obligation $0 $0 $0 $0 $0 $0 $0 #4
<br />-Household SWCC Fee $2,400,000 $2,400,000 $2,600,000 $2,600,000 $2,600,000 $2,750,000 $2,750,000 #5
<br />-Account-Fees (Commercial) $0 $22,500 $33,750 $59,063 $103,359 $118,863 $136,693 #6
<br />Revenue Total $2,661,000 $2,683,500 $2,894,750 $2,920,063 $2,964,359 $3,129,863 $3,147,693
<br />NET SURPLUSI(DEFICIT) $136,327 ($4,378) $102,821 $41,314. $21,936 $110,098 $48,265 #7
<br />CUMULATIVE FUND BALANCE $136,327 $131,949. $234,770 $276,084 $298,020 $408,117 $456,382 #8
<br />
<br />POTENTIAL GF TAX DROP $2,160,000 $2,160,000 $2,160,000 $2,160,000 $2,160,000 $2,160,000 $2,160,000 ' #9
<br />CUMULATIVE GF TAX DROP- $2,160,000 $4,320,000 $6,480,000 $8,640,000 $10,800,000 $12.960,000 $15,120,000 #10
<br />Table 5 shows the 7-Year Enterprise Fund household fee required for the SWCC system when
<br />there is no General Fund contribution at all -starting in year 1. Two types of fee estimates are
<br />shown - a flat fee as well as a tiered fee. The flat fee shows the Household SWCC revenue
<br />requirement from Table 4 allocated equally to all 54,150 residential parcels. The fee increases
<br />in three steps as the required funding increases over the 7-year period. The tiered fee shows
<br />the same revenue requirement allocated proportionally among rural single-family dwellings,
<br />urban single family and multi-family parcels according to an estimated intensity of SWCC use.
<br />Again with step increases each two-year period as the General Fund contribution is eliminated.
<br />10/27/10 ORANGE COUNTY SOLID WASTE Page S of 8
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