Minutes 02-16-2017 - Laserfiche WebLink

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2 2. Solid Waste Five Year Financial Plan and Cost Study Bonnie Hammersley reviewed the information below, and noted that this presentation has already been given to the Solid Waste Advisory Group (SWAG). BACKGROUND: The Department of Finance and Administrative Services determined that the current programs fee of$107 was not sufficient to meet Solid Waste expense requirements in subsequent fiscal years attributed in part to a dramatic shift within the Recycling industry. From fiscal years 2010-11 to the present, the recycling market has undergone significant changes which have resulted in a decrease in recycling revenues to the Solid Waste Enterprise Fund. During the same period, operating expenses for recycling operations processing has increased, as evidenced by the tons recycled. The chart below illustrates the decrease in recycling revenues and the increase in tons recycled from FY 2010-11 through FY 2015-16. The Solid Waste Enterprise Fund has had to utilize fund balance to offset the decline in recycling revenues. As a result of the unstable state of the recycling market, the County retained an independent third party consultant, SCS Engineers to confirm its' internal assessment by conducting a solid waste cost of services and rate study. SCS Engineers in collaboration with County staff developed a Five Year Financial Plan to ensure fiscal resiliency to the Solid Waste Enterprise Fund on a long-term basis while at the same time maintaining the County's record and reputation for achieving high waste reduction targets and landfill diversion. The financial analysis concluded that an increased program fee is necessary to achieve a sustainable and recurring revenue stream for the Solid Waste Enterprise Fund. The suggested method for increasing the fee is to use a multi-faceted approach with a General Fund and a Solid Waste Fund Balance contribution to modestly increase the program fee. On January 30, 2017, the County Manager presented to the Solid Waste Advisory Group (SWAG) two options that used the multi-faceted approach (Attachment C). Also, the Community Development Director will develop a communication plan to inform residents of the Solid Waste program fee. Bob Dick with SCS Engineers made the following PowerPoint presentation. He reviewed some history, noting, prior to FY 15-16, Orange County had several different fees after the closing of the sanitary landfill in 2013. He said these fees were discontinued in 15- 16, and the County introduced a comprehensive program fee to 60,000 developed parcels. He said the finance department observed a potential shortfall, and SCS Engineers was called in to look at a more comprehensive 5-year financial plan. Bob Dick made the following PowerPoint presentation: Financial Plan and Rate Study for Solid Waste Enterprise Fund Orange County, NC Presented by Bob Dick, PE and Ryan Duckett February 16, 2017 Summary of SCS' Efforts Since May 2016 SWAG Meeting • Revision of Financial Model based on Actual FY 2016-17 Budget • Budgetary Leveling throughout Financial Model • Additional Revenue/Expense Analysis • Finalize and Submit Final Report