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  • San Juan County Solid Waste:

    Funding

  • Solid Waste FundingCurrent Solid Waste RevenueRate Structure used to collect revenueCost of ServiceCurrent Funding ProblemsSolutions

  • Current Revenue SourcesPrimary Source of Revenue is Garbage Tipping Fee (86.6%)Excise Tax is used to Support Capital Expenses (9.8%)Grants (HHW, Litter, Composting)(1.7%)Recycling Revenue (2%)Miscellaneous Fee Revenue (HHW, unsecured loads)

  • Service Rate By Customer Class April 2008Self Haul$7.50 per can$278 per ton10% to Capital Fund (Disposal District)3.4% to State Refuse TaxTown of Friday Harbor$187 per ton (largest SJI customer)None to Capital (except portion of fund shift)San Juan Sanitation$187 per ton (effective rate) $157.40 Tipping fee+ 10% of Gross Revenue to Capital Fund

  • Service Rate continuedRecycling Customers Drop off at transfer stations NO FEEPost Office junk mail NO FEEOther Customers HHW CollectionAnnual collection events MINIMUM FEEFacilities for Used Oil, Anti-freeze, vehicle batteries NO FEELitter ControlRoadside, beaches, volunteer coordination NO FEEOther Subsidized ActivitiesComposting workshops, e-waste events, weed control, lions club reuse NO FEE

  • Rate History

  • Factors that Control RatesCost of InfrastructureLand, Buildings, EquipmentDebt on CapitalMaintenance of Infrastructure

    Cost of OperationsCollectionProcessingDisposalOverhead

  • Factors that Control CostsPolicyLevel of ServiceEfficiency of OperationGeographyVariable CostsLaborFerry ServiceDisposal, Transportation and Processing Contracts

  • Cost of Service

  • Cost AllocationHow to calculate the appropriate share of costsBased on Tonnage?Based on Time?Based on number of Trips?

  • Rate Development ConceptsRevenue Requirements compares revenue to expenses to determine overall rate.Cost of Service - determines revenue requirements for customer classes based on level of service.Rate Structure method used to allocate the cost of service to various customer classes, based on the governing bodies policies, that balances revenue and expenses.

  • Revenue ProblemsNo Revenue for new capital facilities No Revenue for equipment replacementNo Operating ReserveIncreases in recycling can drive up cost without providing increased revenue.

  • Recommended Full Cost Accounting Changes From 2005 AnalysisFund Capital and depreciation costs at approximately $167,000 per year (further definition of need)

    Establish a Reserve equal to a minimum of two months operations plus one year of capital i.e. $620,000

  • Potential Rate Structure Changes(2005 recommendations)Increased Minimum Fee For Self Haul ($9.58 or $11.67)Initiate an Administration Fee ($7.04)Charge an excise tax per developed parcel to support Recycling, Reserves and CapitalCharge A Tipping Fee For Recycling

  • Rate Structure IssuesRecycling SubsidyGarbage classes pay for most recycling costsSelf Haul ServicesTransfer cost are higher for self haul due to low volume per tripDiscount Rates for Large Customers Which Class Will pay for Capital and Reserve

  • Recycling SubsidyReduces impedimentsEncourages separation from garbagePeople that choose not to recycle still pay for the public benefit of the system.

  • Self Haul ServicesIssuesSmall volume of waste Relatively high service time on siteLess manageable regarding timing

    Cost of Service Analysis (2005)$6.16 per can based on weight$9.58 per can based on service time @ facility$11.67 per can if administration is based on number of trips to the transfer station

  • Discounted Rates For Large Volume CustomersTown and Franchise pay lessDo not pay for the recycling portion of the programCost less to provide transfer service due to large loadsTown does not contribute directly to the capital fund (operations does support capital)

  • Options for Rate Structure ChangeTipping FeesUsers Pay by Weight or VolumeAdministrative FeeTaxesGeneral Property TaxNew Parcel TaxIncrease Existing Excise TaxCould apply to all residents of Disposal District or only to users of the system

  • Base Rate ConceptMany public utilities have a two tiered rate structure: Base Rate All customers pay. Covers fixed costs and infrastructure. May cover cost of recycling system and other free services. Volume Rate Customers pay according to how much they use the system. Covers operating costs.

  • Applying a Base RateApply to all potential customersParcel FeeApply only to current usersExcise TaxAdministration feeApply only for specific servicesFee for use of recycling services

    Apply to all servicesAnnual fee to use facilities

  • Costs included in a base rate?Debt ServiceFuture Capital Facilities and EquipmentCreating a Reserve Fund Landfill MonitoringRecycling ProgramSubsidized Services

  • Per Parcel Example

    Sheet1

    Activity2006 Expenditure% of TotalPer TonRevenue

    Garbage Transport & Disposal$982,28537%$81.38Tipping Fee

    Garbage Transfer$562,33421%$46.59Tipping Fee

    Debt$260,05710%$16.95NONE

    Administration$203,9268%$13.29NONE

    Recycle Transport & Processing$153,0366%$46.79Sales $19K

    Recycle Transfer$123,9055%$37.88NONE

    HHW and Litter$106,5794%$6.95Grants $90K

    Landfill Monitoring$90,2773%$5.89NONE

    Engineering and Professional Service$83,3683%$5.43NONE

    Taxes$70,8903%$4.62NONE

    Total$2,636,657$218.43

    Cost per Ton Garbage$181.11$218.54

    Cost per Ton Recycle$137.80$450,746.89

    $37.43

    Average Fee Required$218.43

    20052006

    Garbage1163079.05%1207178.68%

    Recycle308320.95%327121.32%

    Total14713153424.28%

    $914,569$51.55

    $91.81

    $1,722,088$142.68

    Sheet2

    Solid Waste Fee Schedule

    Type of ServiceUnitsCurrent FeeProposed Fee

    Self Haul by weightTon$260$278.00

    Self Haul per canEach$7$7.50

    Town of Friday HarborTon$175$187.00

    San Juan SanitationTon$175$187.00

    Garbage by Volumeyard$35$37.50

    AppliancesEach$17$18.00

    Refrigeration Unit (Residential)Each$44$47.00

    Oil (over 5 gallons)Gallon$0.11$0.12

    Household Hazardous Wastepound$0.05$0.05

    Household Hazardous WasteMinimum$7$7.50

    CESQG **Waste5 Gallons$20$21.00

    CESQG** Waste55 gallons$210$225.00

    Steel for RecyclingTon$130$139.00

    Minimum Garbage FeeTrip$7$7.50

    Litter Clean-upNo FeeNo Fee

    Beach Clean-upNo FeeNo Fee

    Noxious WeedsNo FeeNo Fee

    Commingled RecyclablesNo FeeNo Fee

    BatteriesNo FeeNo Fee

    Sheet3

    Cost of ServiceTotal CostAll ParcelsDeveloped Parcels

    Garbage Transport & Disposal$982,285

    Garbage Transfer$562,334

    Debt$260,057$14.66$26.10

    Administration$203,926$11.49$20.47

    Recycle Transport & Processing$153,036$8.63$15.36

    Recycle Transfer$123,905$6.98$12.44

    HHW and Litter$106,579$6.01$10.70

    Landfill Monitoring$90,277$5.09$9.06

    Engineering and Professional Service$83,368$4.70$8.37

    Taxes$70,890

    $57.56$102.50

    Capital$167,000$9.41$16.76

    Reserve$83,000$4.68$8.33

    Total Parcel Fee$71.65$127.60

  • Administrative Fee Example

  • Questions to AnswerMethod for funding Capital and Reserve? Through Tipping Fee or Base Rate?If Base RateExcise, Parcel, Administrative Fee etc.Which Services Should a Base Rate Cover?Capital, Reserve, Recycling etc.

  • Cost of Services

    Activity

    2006 Expenditure

    % of Total

    Cost Per Ton

    Garbage Transport & Disposal

    $982,285

    37%

    $81.38

    Garbage Transfer

    $562,334

    21%

    $46.59

    Debt

    $260,057

    10%

    $16.95

    Administration

    $203,926

    8%

    $13.29

    Recycle Transport & Processing

    $153,036

    6%

    $46.79

    Recycle Transfer

    $123,905

    5%

    $37.88

    HHW and Litter

    $106,579

    4%

    $6.95

    Landfill Monitoring

    $90,277

    3%

    $5.89

    Engineering and Professional

    $83,368

    3%

    $5.43

    Taxes

    $70,890

    3%

    $4.62

    Total

    $2,636,657

    Cost per Ton Garbage

    $181.11

    Cost per Ton Recycle

    $137.80

    Average Fee Required

    $218.43

  • Rate StructureWhat services require a feeGarbage Tipping (95% of Revenue) Appliances, Household Hazardous Waste Who pays the tipping fee (Customer Class)Self haulTown (partial rate)Franchise hauler (partial rate + percent of gross income)What is FreeRecyclingWeed disposalLitter Disposal

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