Agenda - 04-29-2002 - 3b - Laserfiche WebLink

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5 We also note that private companies have, in the past, been known to enter markets with very low prices until the competition (or local government service) yields to them, then have raised prices to much higher levels. If the Town were no longer in the business, we would be unable quickly to provide the service due to the high capital costs of equipment and hiring and training issues we would face. Advantages • Revenue would increase by about $390,000 on an annualized basis ($300,000 next year) • Would continue relatively high level of service to business community at low cost to that sector • Would not require a reduction in work force • Would not require operational or administrative changes • Likely that existing commercial garbage collection assets would be able to absorb workload increases related to Meadowmont and Southern Village. Disadvantages • Would not reduce general fund expenditures • Businesses would have to pay a fee for service they now receive as part of their tax rate Option 3. Eliminate commercial garbage operations Under this option, the Town would discontinue its commercial solid waste collection program. The routes would be eliminated, with a concurrent reduction in the Solid Waste Services Division's work force and sale of its fleet assets. Businesses, apartments and condominiums/town-homes presently served by the Town would have to obtain refuse collection services from the private sector, at a higher cost. If the Town discontinues collection of commercial waste, then the projected savings could approach $830,000 with position reductions and a starting date of October 1, 2002, next fiscal year. Details of the cost projections are shown in the Appendix. The savings primarily result from a reduction of three positions for nine months next year, deletion of disposal costs and removal of related garbage trucks from the fleet replacement fund. Some of the proceeds from the sale of the garbage trucks would be used to pay off the balance of debt related to such trucks. As can be seen from the cost data in the appendix, total savings from personal service costs, operating costs and disposal costs are about $745,000 in fiscal 2002-2003 and $728,000 in fiscal 2003-2004. These totals would be offset by the cost of collection and disposal of the Town's own commercial waste, estimated at $20,000 annually.