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Trash Authority Mulls Another Rate Hike
By Amanda Martinez
SUN Staff Writer
After thousands of dollars paid to an outside accountant and months of work, the North Central Solid Waste Authority Board knows how much money it has in the bank, but Authority Board members now have to revisit old conversations and come up with new solutions to old, stead-fast problems.
During the regular Authority Board meeting Oct. 18 members discussed the possibility of raising rates, more free visits to transfer stations for city of Española and Rio Arriba County customers and the need to open more collection stations.
Third-party accountant Ed Fierro, of Las Cruces-based accounting firm Fierro & Fierro, P.A., said the Authority must look at its insurance costs, employee salaries and fleet maintenance and repair costs.
“You are surviving, but you are not making enough to make improvements to your overall operations,” he said.
A conversation about cutting costs was not on the meeting’s agenda, but rather arose during County Manager and Board Chairman Tomas Campos’ monthly report.
Campos and Española City Councilor John Ricci said they wanted to increase the number of annual free trips residents can take to the transfer station.
Currently, monthly County customers receive one free punch a year and self-hauling customers receive 18 punches a year. City residents receive two free punches with the option picking up an additional two free visit punch card at city hall.
Fierro said in his opinion, the difference between giving residents two or four free punches will probably make no difference to the Authority’s bottom line.
An aging fleet in need of constant repair will.
“What, in my opinion, what is bad is that the repair and maintenance costs are way too high and that’s because you are trying to deal with an old fleet ,” Fierro said. “Well, let’s upgrade the fleet. We'll do we have $300,000 extra a year for the next five years to improve the fleet? $1.5 million? No, we don’t have that.”
On a cash basis, the Authority spends $326,652 on vehicle repair and maintenance each year.
Employee benefits
Fierro also said management needs to look at employee benefits.
“They are getting Cadillac in coverage,” he said.
According to the Authority’s budget, it has an operating cash budget of $4,839,195 a year and has about $1.8 million in the bank.
Of that total, $1,640,093 goes to employee salaries. Tack on an additional $612,797 for employee benefits and $120,449 in payroll taxes, which includes Social Security, Medicare and state unemployment taxes.
Benefits and taxes account for about 15 percent of the total Authority budget.
As a business owner, Fierro said that amount is unsustainable.
Campos said a rate increase is likely the solution.
“Let me tell you, another scenario that is coming down the road, it is obvious looking at our books, there is probably a rate increase,” Campos said. “That is the only way this entity makes money.”
The Authority raised prices Jan. 1 from about $18 to $20 for County residents receiving door-to-door trash collection services.
Ricci said some sort of rate study must be done to determine the true cost as door to door collection in the city and the County before this can happen.
The Board cannot take the rate increase to residents without proving they are necessary, he said.
“We are in order, but we are short and we are wanting to take care of our community,” Ricci said. “We have our concerns about the illegal dumping and we got to get a handle on that. The only way we are going to generate extra income is with a rate increase.”
The Board took no action and made no decisions as to when, or if, they will hire an outside company to conduct a rate study.
Fierro said Authority staff is already too overloaded with work to take on the job.
Alleged fraud, abuse
Authority General Manager Peter Fuller said he could not comment about recent allegations of fraud and mismanagement of Authority funds.
A payment order for Fierro’s services in August showed he did work concerning alleged fraud and mismanagement of Authority money.
Fuller said those documents have been turned over to the New Mexico Office of the State Auditor and he cannot comment until the 2015-2016 and 2016-2017 Authority audits are made public.
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