COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Public Works

DATE:

September 18, 2008

BOARD MEETING DATE:

October 7, 2008

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

James C. Porter, Director of Public Works

SUBJECT:

Pescadero Transfer Station Gate Fee Rate Increases

RECOMMENDATION:

Adopt a resolution:

1.

Approving Pescadero Transfer Station Gate Fee Rates; and

2.

Directing the Director of Public Works to provide notice by mail to the operator of the Pescadero Transfer Station/Materials Recovery Facility of the new gate fee rates and to provide notification to each customer visiting the facility with a flyer that identifies the new gate fee rates effective October 20, 2008.

VISION ALIGNMENT:

Commitment: Responsive, effective and collaborative government.

Goal 20: Government decisions are based on careful consideration of future impacts rather than temporary relief or immediate gain.

Setting the new Pescadero Transfer Station gate rates FY 2008-09 will decrease the subsidy from the Solid Waste Fund and provide increased recycling opportunities to Pescadero residents and the South Coast agricultural community.

BACKGROUND:

On August 12, 2008, your board approved an agreement with Allied Waste Services to operate the Pescadero Transfer Station and Materials Recovery Facility from
August 15, 2008 through August 14, 2015. That agreement provided for the reevaluation of the present gate rates in order to align the fees with the new operating agreement and additional recycling services.

DISCUSSION:

Public Works staff has evaluated the costs of operating the Pescadero Transfer Station, and the revenue received from July 2006 through June 2007. The cost during this period was $263,056 (not including Public Works administrative costs), and the revenue received from customers at the gate was approximately $36,737. The County currently subsidizes the costs of disposal and operations of the Pescadero Transfer Station by $226,319 from the Solid Waste Fund. We do not subsidize solid waste disposal costs in any other unincorporated area. The proposed rates as shown in Exhibit A will include three increases over the next twelve months that will reduce the subsidies to $250,188 in year one and $175,861 for each year thereafter. Staff is concerned that raising the gate rates above those proposed would result in increased illegal dumping on public and private lands. A gate rate increase for disposal has not occurred since the site opened in 1986. Exhibit B provides current rate information for solid waste disposal and recycling at other facilities in the County for comparative purposes. The Pescadero Transfer Station currently has the lowest costs.

The proposed series of phased rate adjustments is a result of discussions with the Pescadero Municipal Advisory Council during three meetings in 2008 that included the site operations and finances, the Request for Proposal process, new recycling opportunities and the phasing in of the proposed rate increases.

County Counsel has reviewed and approved the resolution as to form.

FISCAL IMPACT:

Public Works staff is working with the County Manager’s Office to resolve the structural deficit that currently exists in the Solid Waste Fund. Increasing the customer gate fee rates at the Pescadero Transfer Station is one of the strategies to resolve the structural deficit. The proposed rate increases when fully implemented, will reduce the subsidies to an estimated $175,861 per year. Leaving gate rates unchanged would result in an annual County subsidy of $307,603.

There is no impact on the County’s General Fund.

Attachments:

Exhibits A and B