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Environmental Consultants <br />November 2, 2016 <br />File No. 02216202.00 <br />MEMORANDUM <br />15521 Midlothian Turnpike 804 378 -7440 <br />Suite 305 FAX 804 378 -7433 <br />Midlothian, VA 23113 -7313 www.scsengineers.com <br />T 0: Gary Donaldson, Orange County <br />Gayle Wilson, Orange County <br />FROM: Ryan Duckett, SCS Engineers <br />Bob Dick, SCS Engineers <br />SUBJECT: Solid Waste Enterprise Fund — Additional Considerations <br />Orange County Solid Waste Financial Plan and Rate Study <br />As an extension of the Orange County Financial Plan and Rate Study Final Report, developed by <br />SCS Engineers and submitted to the County on October 13, 2016, SCS has prepared this <br />discussion of issues that should be considered by Orange County as it addresses potential <br />changes to the current financing methods for its existing solid waste and recycling programs. <br />This memorandum presents some of these possible operational changes and offers examples of <br />other municipalities' financial parameters as a benchmarking effort to increase perspective on a <br />local, regional, and national scale. <br />PROGRAM FEE SLIDING SCALE ASSESSMENTS <br />SCS was unable to identify any municipalities within the US that apply solid waste program fee <br />assessments utilizing a sliding scale approach based on the valuation of each assessed property. <br />Based on our research and work experience for municipalities throughout the country, ad <br />valorem (proportional to property value) methodologies are not utilized to vary the amount of a <br />solid waste program fee paid by different property owners that receive consistent solid waste and <br />recycling services. Generally, when an ad valorem revenue generation methodology is desired, <br />funding is generated via the actual general property tax portion of the tax bill. A non -ad valorem <br />special assessment is a charge (or assessment) against a specific parcel of property based on a <br />specific benefit which the property has or will receive. In the case of Orange County, this type of <br />assessment aligns with the Program Fee. <br />BENCHMARKING OPERATIONAL RESERVES <br />Most local governments do not have formal operational reserves or "rainy day" funds in the <br />same way most state governments possess such funds. That is, a typical state government fund is <br />governed by state law that sets a target fund balance and dictates when to use and replenish the <br />balance. According to recent research, only 11 of the 30th largest cities in the U.S. have an actual <br />Offices Nationwide <br />