MINUTES OF THE METRO COUNCIL BUDGET TASK FORCE SUBCOMMITTEE MEETING

November 18, 1999

Council Annex

Councilors Present:    David Bragdon, Ed Washington, and Rod Park

Others Present:      John Houser, Mike Burton, Terry Peterson and Dan Cooper

Subcommittee Chair David Bragdon convened the Council Budget Task Force Subcommittee meeting at 2:10 p.m.

INTRODUCTIONS

None.

EXECUTIVE OFFICER COMMUNICATION

Mike Burton, Executive Officer, said he wanted to make two points clear. The public needs to get money back from the garbage savings and Metro needs to get back to its real responsibility of planning. His comments are attached as a permanent part of this record. He introduced a draft resolution stating a process and prioritization for use of renegotiated contract savings.

Chair Bragdon asked if Mr. Burton’s proposal was for fiscal year beginning July 2000, or the current fiscal year.

Mr. Burton said his proposal was directed to the future fiscal year, however, he suggested the Council might enact ordinances reflecting a rate collection and change in excise taxes this year so future reserves could begin. With repeal of the excise ordinance and the new contract beginning January 1st, those savings would accumulate in the solid waste fund, but will not help with other issues such as planning. Between now and next fiscal year, department heads have been asked to freeze hiring and closely examine expenditures to produce an ending balance.

Chair Bragdon asked if Mr. Burton was saying he would dedicate the solid waste savings to local partners to be used only for solid waste.

Mr. Burton replied that the contract savings occurred because of renegotiation of the solid waste contract and felt that the public should have an opportunity to share in those savings. However, Metro has been subsidizing solid waste for years, and he said the local jurisdictions should have to request from Metro’s solid waste fund reimbursement for reduced or stabilized rates. Unused funds would be used to increase recycling and waste reduction. Local jurisdictions could be given the option to create their own new recycling and waste reduction programs.

APPROVAL OF MINUTES OF THE NOVEMBER 8, 1999 TASK FORCE MEETING

 Motion:  Councilor Washington moved to adopt the meeting minutes of the

November 8, 1999 Budget Task Force Subcommittee Meeting.

 Seconded:  Councilor Park seconded the motion.

 Vote:    The vote was 3 aye/ 0 nay/ 0 abstain. The motion passed unanimously.

DISCUSSION OF CRITERIA, PROCEDURES AND STRUCTURE FOR THE ALLOCATION OF NON-SOLID WASTE FUNDS

Chair Bragdon asked Councilor Park to follow up with questions from last week’s meeting.

Councilor Park asked Mr. Terry Peterson what our year 2005 recycling goal was.

Mr. Peterson said 56%.

Councilor Park asked Mr. Peterson if the region’s goal of 56% were achieved, how would our recycling costs be impacted?

Mr. Peterson summarized that the March 1999 forecast was the basis for the numbers provided Council Analyst John Houser. In October, that forecast was updated and released at the REM Committee meeting November 17,1999. The recycling assumptions built into that forecast will not affect the $6 million projected savings. The tip fee projections presented to Council cannot be maintained if the tonnage lessens. Either the tip fee would be increased or solid waste savings would be allocated to augment the tip fee. He said the first 550,000 tons is $23.00, with a dramatic drop to $8.00-$9.00 per ton after that. With a 56% recovery rate, it is forecasted that by year 2005, revenue tonnage would be 100,000 less tonnage than we currently have. Reduced tonnage does not necessarily mean increased cost, but per ton rate increase. The annual cost reduction in contract payments to our disposal contractor will hold irregardless of the tonnage amount. If there was less recycle recovery, our per ton disposal price would be lower and allow the tip fee to remain the same. In the alternative, if more aggressive recovery were to be undertaken, there would be pressure to increase the tip fee.

Councilor Park stated his concern over the Executive Officer’s suggestion that funding from the contract savings be provided to local partners who demonstrate reduced or stable rates. He wanted a statement that if the funds were available, they could be used. But if recycling targets were achieved, there would be little funding available to fund the Executive Officer’s suggestion. He distributed his draft ordinance repealing Metro Ordinance No. 99-824A.

CONSIDERATION OF DRAFT ORDINANCE TO REPEAL ORDINANCE 99-824

Councilor Park said based upon new information and assumptions received that if recycling goals were reduced we could save money. He felt that was not a good message to the community. If tonnage and recycling forecasts hold, Metro will have fewer excise dollars, regardless of the scenario, to carryout the planning functions and other recent requests. He proposed his draft of Ordinance No. 99-831 and asked the Subcommittee to recommend it to the Presiding Officer and the entire Council.

Councilor Washington said that much genuine effort had been put into the appropriate disposition of the solid waste savings. He felt that the focus on appropriate use of the funds was what had been done. He said there are many solid waste issues pending that need resolution and that he encouraged stopping and assessing these issues before deciding how to spend the solid waste savings. He asked Mr. Peterson to comment on what direction solid waste was taking.

Mr. Peterson said solid waste issues have been closely tracked and overall revenue tonnage can be affected by economic issues. He said the forecasts that have been made are mid-range and consistent with past trends, and do not reflect significant changes in loss of flow control, regional transfer stations or changes in the management of the 10%. These factors can impact our solid waste rates.

Mr. Dan Cooper stated that the pending lawsuit issue would be discussed in Executive Session at Council later in the afternoon.

Councilor Park asked Mr. Peterson if Metro met the 56% recycling goal in the year 2004-2005, we would have a tipping fee of $72.85, but if we did not meet the 56% recycling goal, the tipping fee would be $67.00. What was the difference?

Mr. Peterson said it was a difference of tonnage. Less tonnage was modeled to follow the increase in the recovery rate. Less tonnage drives up the tip fee. If the recycling was dramatically lowered, the tip feel could be held or reduced. He said the current tip fee could be held through 2002-2003, with a possible increase to $64.00, then $65.30 in 2005. Lower tonnage could be subsidized with the rate stabilization account.

Mr. Burton said that if the tip fee did increase, it would still be lower than it was three years ago. Also, because we had an annualized budget, it could be adjusted periodically. In response to Councilor Park’s question of increased recycling and pressure on increasing the tipping fee, he said those dollars could pay for the program’s increase in recycling.

Chair Bragdon said originally the Subcommittee was charged with addressing the expenditure portion of the solid waste savings. There currently has not been a consensus on spending the money, and the Council continues to receive diverse opinions from the community. He is supportive of Councilor Park’s position.

 Motion:  Chair Bragdon moved to recommend draft Ordinance No. 99-831 to

Presiding Officer Monroe, after minor adjustments by Mr. John Houser,

to present to Metro Council with the Subcommittee’s support for

passage.

 Seconded:  Councilor Washington.

 Vote:    The vote was 3 aye/ 0 nay/ 0 abstain. The motion passed unanimously.

Councilor Washington asked Chair Bragdon if it was correct that public testimony would not be allowed at these subcommittee meetings.

Chair Bragdon said it was correct. These are to be working sessions culminating with a recommendation to the full Council, where, if directed, any public testimony would take place.

Chair Bragdon suggested that Mr. Burton’s draft resolution be the beginning point of the next Subcommittee meeting and that going forward with Councilor Park’s draft ordinance would not preclude Mr. Burton’s resolution.

Mr. Burton said he wanted to outline for Council a plan for the intent of the savings.

Councilor Park mentioned the mechanism for returning the funds locally. Was Mr. Burton recommending the funds be returned to the local jurisdiction’s rate stabilization committee?

Mr. Burton responded that every jurisdiction has essentially the same system we have to set rates. It would need to be investigated, but he felt there was a way to send the money from solid waste fund to solid waste fund. His proposal was to restrict jurisdictions’ use of the funds to recycling or rate reduction.

Mr. Cooper explained that there were probably multiple ways of making the Executive Officer’s proposal legal within Metro’s statutory authority.

Councilor Park requested the net amount of savings be determined.

Mr. Burton said recycling was a state law, and the manner was clear: waste reduction, waste reuse and recycling.

Chair Bragdon adjourned the meeting at 1:20 p.m.

Respectfully submitted,

Patricia Mannhalter

Council Assistant

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