Supervisors raise fee for waste haulers

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Rural Tulare County residents may have to pay more for garbage collection next year, but the majority of those living within the cities may not see an increase.

The Tulare County Board of Supervisors voted 3-2 on Sept. 11 to increase the tipping fee charged to commercial waste haulers for dumping at County landfills. The fee was increased by $3 to $34 per ton and will take effect on Jan. 1, 2013. And while haulers operating in the unincorporated communities may pass that cost onto their customers, it is unlikely residing in the County’s eight incorporated cities will have to pay more, at least for now.

Jim Vagim, government relations director of Sunset Waste Systems, said during the public hearing that unlike county waste haulers, Sunset cannot pass the cost onto cities while they are under contract. Sunset Waste Systems provides refuse collection and recycling services for Exeter, Farmersville, Lindsay and Woodlake.

“The tipping fee will create a burden for the city’s we represent,” Vagim told the Supervisors. “Unlike county haulers, we don’t have the luxury of a rate increase. We have to ask the cities to absorb that cost.”

Vagim said Sunset Waste Systems was expected to meet with city officials in Exeter, Farmersville, Lindsay and Woodlake sometime this week. According to Sun-Gazette records, contacts with the cities of Lindsay, Exeter, Farmersville and Woodlake would not expire until 2014, 2016, 2017 and 2026, respectively.

“We bring all of our materials to the County,” Vagim said. “If approved, Sunset would consider other venues for our material.”

Denise Akin, administrative analyst with the County Administrative Office, said the current tipping fee of $31 per ton was adopted by the Supervisors in 1994 and has not increased despite increases to costs associated with solid waste including labor, capital replacement and environmental regulations. And while costs have gone up, the amount of tons being brought to county landfills has decreased due to AB 939, which forced cities and counties to recycle and divert 50% of their waste from landfills. The problem is compounded for the county when you consider about half of the County’s annual tonnage of solid waste (141,000 tons) is hauled to landfills outside of Tulare County, Akin said.

“If we were able to grab all of the tonnage currently leaving the County there would still be shortfall [at the current rate],” Akin said.

Akin said the $34 fee was significantly lower than what was identified in a recent study. She said consulting firm HF&H conducted a tipping fee study beginning in 2008 and ending in 2010. Based on their review of the Solid Waste Enterprise Fund expenses and revenue, consultants suggested a tipping fee increase between $17-$41 per ton, meaning a fee of $48-$72 per ton.

“Due to the diligence of staff to identity other cost saving measures, the recommended fee is significantly lower than those proposed by the consultant,” Akin told the Supervisors.

Even at the $34 rate, Tulare County would still be the second lowest among neighboring counties. Kings County charges $75 per ton, Kern County charges $45 per ton and the Avenal Landfill charges $40 per ton. Only Fresno County was less, with a rate of $22.65 per ton.

“Tulare County would have to nearly double the amount of general refuse received annually in order to reach a rate that would be competitive with facilties outside of Tulare County,” Akin said.

Supervisor Pete Vander Poel suggested a tiered system, where unincorporated waste haulers paid the $3 while haulers serving incorporated cities paid $1.50.

“Our population is primarily urban,” Supervisor Steve Worthley said. “We won’t gain much revenue without them.”

Supervisors Phil Cox, Mike Ennis and Worthely voted in favor of the $3 increase while Supervisors Allen Ishida and Pete Vander Poel voted against.

“If the cities are reluctant to take the increase to the residents then the providers would have to absorb it,” Ishida said.

The fee was originally scheduled to take effect on Dec. 1, 2012, but Supervisors delayed the increase to Jan. 1, 2013 to give cities time to adjust their budgets or rates.

The tipping fee increase was the latest cost cutting measure to close a $5.1 million deficit in the County’s Solid Waste Enterprise Fund for the Fiscal Year 2012-13. At its Aug. 28 meeting, Supervisors approved the closure of four transfer stations and reduced operating days at the Teapot Dome Landfill. They also required licensed refuse haulers to deliver waste to a landfill within the County. The transfer station closures and reduced operating hours will go into effect Nov. 1, 2012. The closures and reduction in operating hours will cover $1.5 million of the deficit. Requiring licensed refuse haulers to deliver waste to a landfill within the County will go into effect Oct. 1, 2012.

A third measure, a landfill fee overhaul, was also approved pending review by the Tulare County Auditor-Controller. More than 20 fees are subject to review and approval. Staff estimates that the landfill fee overall measure would cover $3.1 million of the projected deficit. The remainder of the deficit – $500,000 – has been covered by measures staff put in place in the past few months, which included eliminating seven full time vacant positions, postponing equipment purchases, and reducing service contracts. Those measures saved $800,000.

Tulare County Administrative Officer Jean Rousseau said the projected operating deficit to the Solid Waste Enterprise Fund can be attributed to dated landfill fees, a reduction in material received due to recycling requirements, low interest rates, and a reduction in reserves that earn interest.

The Solid Waste division is operated as an enterprise fund within the Tulare County Resource Management Agency, whose largest services include public works and planning. Enterprise funds are used for services provided to the public through user charges, which should cover 100 percent of the cost through no subsidy from the County.

Over the past five years, Solid Waste Enterprise Fund cash was depleted due to operating inefficiencies and capital projects to fund necessary landfill expansion projects. The approved measures will begin to bridge the deficit and restore the reserves for future landfill capacity.

Worthley suggested the County continue to look at its landfill operations and consider only operating one landfill reduce cost.

“Fresno County, from Coalinga to Orange Cove only has one landfill,” Worthley said. “Should we be offering three landfills?”

Cox agreed, “We need to look real hard at the way we are doing business.”

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