SWAG agenda 110316 - Laserfiche WebLink

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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.