COUNTY OF ALBEMARLE
Local Government Support Agreement Among the City of Charlottesville, the County of Albemarle, and the Rivanna Solid Waste Authority
Adoption of Resolution authorizing the County Executive to execute Support Agreement
LEGAL REVIEW: Yes
December 5, 2007
ACTION: X INFORMATION:
The Rivanna Solid Waste Authority (“RSWA”) is the authority responsible for handling the solid waste generated in the City of Charlottesville and the County of Albemarle. Until recent years, the RSWA operated without the need for direct financial contributions from either the City or the County. The primary source of revenue was tipping fees charged at the Ivy Landfill. However, almost all of the tipping fees for municipal solid waste ceased in 1998 when the last solid waste cell was closed and almost all of the tipping fees for construction and demolition debris ceased in 2001 when the last construction and demolition debris cell was closed. In 1998, to deal with the closing of the last municipal solid waste cell at the Ivy Landfill, the RSWA entered into an agreement with Allied Waste Industries, Inc. (formerly BFI) which provided that the City and the County municipal waste would be accepted at the Zion Crossroads solid waste transfer station. In addition to getting an assured tipping fee from Allied Waste, the Agreement created a “service contribution fee” that would be required to be paid by haulers delivering trash to Zion’s Crossroads from the City or the County. A requirement of the Agreement was that trash being hauled by Allied would be exempt from the service contribution fee. Also, to assure that the City residential customers were contributing to the operating costs of the RSWA, the City was required to pay the service contribution fee on its residential trash taken to Zion’s Crossroads. Since 1991, the primary source of revenue to pay for administrative and operating costs of the RSWA has been the “service contribution fee”. This source of revenue is not sufficient to cover all of the RSWA’s costs and it is likely that a direct contribution from the County and the City will be necessary to meet ongoing administrative and operating costs.
In 2001, the City began withholding its payment of the service contribution fee, notwithstanding the 1998 Agreement with Allied Waste, taking the position that it would withhold such payments until an agreement was reached with the County on how to fund the deficits of the RSWA. In 2005 an agreement was reached on how to fund the environmental remediation costs at the Ivy Landfill with those costs being shared between the County, the City, and the University of Virginia. Negotiations on how to fund the administrative and operating costs of the RSWA have been ongoing. Since 2001, the City has withheld slightly less than two million dollars in service contribution fees and has incurred more than one million five hundred thousand dollars in penalty and interest on that unpaid amount. The City paid $400,000 of the withheld funds earlier this year when the RSWA was facing a serious operating deficit but the balance is unpaid.
Goal 5: Fund the County’s Future Needs.
After years of negotiations, an Agreement is proposed to address the sharing of the RSWA’s administrative and operating expenses between the City and the County when those expenses exceed the revenues of the RSWA. The proposed Local Government Support Agreement Among the City of Charlottesville, the County of Albemarle, and the Rivanna Solid Waste Authority is attached. The following is a summary of the most relevant terms:
Section 1: The City will pay the remainder of the withheld service contribution fee within 30 days of the execution of the Agreement. The RSWA agrees that it will not charge any penalty or interest, and the City agrees that there will be no
restriction on how the RSWA may use the funds. This section also provides that the RSWA will refund a prior payment of $250,000 to the County within 30 days of the execution of the Agreement.
Section 2: For Fiscal Year 2008, the City will pay the RSWA the standard tipping fee of $62.00 per ton for all solid waste collected under the City’s curbside contract and transported to the Zion Crossroads Transfer Station. The RSWA agrees that the $62.00 fee charged to the City, which includes the service contribution fee, will not be increased in FY 2008. For future years, any increase in the tipping fee charged to the City will not increase beyond the rate of inflation. This section also contains a comparable restriction on rate increases for waste collected or contracted for collection by the City and taken to the Ivy transfer station, although the City is not currently using that facility.
Section 3: This section provides that effective July 1, 2008 the City will no longer pay the RSWA the service contribution fee, regardless of whether the City continues to utilize the service of Waste Management under the current contract or a new curbside collection contract is awarded in 2008. Due to inadequate capacity at the Ivy Transfer Station, the City agrees that solid waste collected under its curbside contract will not be taken to the Ivy Transfer Station. Last, this section provides that the City and the County will not oppose any extension of the RSWA’s existing contracts with Allied Waste or Waste Management.
Section 4: Beginning in FY 2008, the RSWA will calculate the total amount of service contribution fees billed at both the Ivy Transfer Station and the Zion Crossroads Transfer Station, and the percentage of that total that is attributable to solid waste generated within the City and the County. The City’s and the County’s percentages of the service contribution fee will then be compared to their respective percentages of the total City and County populations. If one locality’s percentage of the service contribution fee is less than its percentage of the population, an additional payment will be made to the RSWA or to the other jurisdiction so that the percentage of service contribution fee will equal the percentage of population. If either the City’s or the County’s percentage of service contribution fee exceeds its population percentage, that jurisdiction will receive a refund or credit, at the option of the RSWA, in the amount necessary to equalize the percentages. This provision remains in effect until June 30, 2010 or the full implementation of the RSWA’s strategic plan, whichever occurs first.
Sections 5-7: If, after any payments pursuant to Section 4, the RSWA still has an operating deficit, the City and the County will pay that percentage of the deficit that represents its percentage of the area population. These deficit payments are made quarterly (Section 6), and the deficit may be increased or decreased by amendment of the RSWA budget during the fiscal year (Section 7).
Section 8: The RSWA is required to develop and implement a strategic plan with the goal of becoming financially self-sufficient. This section states that it is the intent of the parties that the plan be implemented by no later than June 30, 2010.
Section 9: This section provides that this Agreement takes precedence over the 1990 Organizational Agreement that created the RSWA. Due to changes in circumstances, the 1990 Agreement no longer represents the reality of how the RSWA is operating.
This Agreement will require the County to pay approximately 70% of any operating deficit of the RSWA based on the County’s percentage of the City/County population.
Adoption of the attached Resolution would authorize the County Executive to execute, on behalf of the County, the Local Government Support Agreement Among the City of Charlottesville, the County of Albemarle, and the Rivanna Solid Waste Authority.
A – Resolution
B – Agreement
C – Exhibit 1 of Agreement
Return to consent agenda
Return to regular agenda