1. Rural Waste Collection Options Department of Budget and Management 01/21/2014

2. Initial Sanitation Concept Single Exclusive Franchise Agreement – One District /One Vendor to service all rural residents of Hidalgo County Concern Displacement of local haulers Residents have limited choice 2

3. Modified Sanitation Concept Multiple Exclusive Franchise Agreements Multiple Districts/Multiple Vendors to service all rural residents. (6 Districts) Concern No guarantee of small hauler displacement Choices are still limited 3

4. Public Hearing 08/27/13 - Public Hearing held to consider public input and commentary regarding the proposed rural solid waste collection program. CC Recommendation Meet with potential vendors to understand their concerns and develop project recommendations 4

5. RFI Findings 7 Vendors currently service 20,500 rural residents (56,799 total) 36% of rural households are using private haulers 64% are using a transfer station/landfill and/or illegally disposing All haulers interviewed would be willing to pay a 5% franchise fee Vendors willing to operate the transfer stations and submit franchise fees Existing sanitation model is preventing haulers from increasing customer base. Transfer stations remain open to the public 5

6. Advantages: Identical rate countywide Less vehicular traffic Fewer haulers to monitor Consistent level of service 6

7. Disadvantages Displacement of small haulers Does not promote competition Residents do not have a choice Difficult for one hauler to service areas with less density due to higher operation costs 7

8. Advantages Promotes competition Enables all haulers to stay in business Allows rural residents to choose the best options 8

9. Disadvantages More vehicular traffic Rate may fluctuate depending on hauler selected by rural resident More haulers to monitor 9

10. Recommendations Based on the RFI’s questionnaire responses and vendor interviews conducted, the following actions are recommended 1.Assess a 5% franchise fee to all waste haulers 2.Assess a fee for disposal service at the citizen collection stations 3.Consider privatizing/franchising or assessing a fee at the citizen collection stations 10

11. Assess a franchise fee to all waste haulers Utilize Non-Exclusive Franchise Agreements Open Market Concept All Waste Haulers are assessed a 5% franchise fee Competition keeps rates low Under a non-exclusive franchise system, rural county residents will have a choice of more than one waste hauler because the system is open to competition to all haulers that enter into an agreement. The waste haulers deal directly with the public in competing for rural resident customers. Rural residents get to choose the most economical vendor. 11

12. Assess a fee for disposal service at the citizen collection stations Implement a Pay As You Throw (PAYT) system – Residents pay a variable rate depending on the amount of trash disposed – Fee will be based on volume or weight Options Utilize county staff to assess, collect and operate the transfer stations or; Privatize the transfer stations and collect a franchise fee Under a Pay As You Throw (PAYT) trash program, households are charged for trash disposal based on the amount of trash they throw away, providing a direct economic incentive for residents to reduce waste. Will encourage and initiate recycling efforts 12

13. Gives rural resident another option to self haul. County would have an option to collect a franchise fee from awarded vendor Or; County can assess a fee for waste disposal at the collection stations 13

14. Advantages Allows rural residents to choose the best options County keeps control of the Sanitation Functions Encourages competition Closes the trash black market Reduces current M/O expenditures Increases revenues 14

15. Initial transition and support (illegal dumping) Potential capital costs (scale or visual) Dedicated Code Enforcement (equipment and training) 15

16. Education and Outreach Available Recycling Options Good Code Enforcement – Code Officer have to be heavily involved – Target known bad areas first – Conduct surveillance and sting operations – Stiffen penalties and repercussions 16

17. Franchise Implementation Process 1.Present sanitation program options and recommendations to Commissioners Court 2.Draft county sanitation ordinance regarding the franchising of waste haulers 3.Notify affected haulers of planned “franchise“ system program 4.Receive commentary and conduct 2 nd public hearing 5.Draft Non-Exclusive Franchise Agreements 6.Seek Commissioners Court Approval and Authorization of ordinance and agreements 7.Haulers apply for the franchise agreements 8.Commissioners Court issues franchise agreements via Court Action 9.Franchisee send monthly revenue collections report as well as monthly 5% franchise fee 10.Franchisee sends annual report to the county 11.County periodically Audits the Franchisee financial statements (via County Auditor) 17

18. Assess a 5% Franchise Fee to all the waste haulers in Hidalgo County All vendors remain in business Vendors compete for customers Rural residents choose the best options and rates Keep transfer stations open (2 options) 1.Operated by county personnel Revenues would help offset M/O costs or; Fee would be based on volume or weight 2.Operated by a Private Hauler County would collect an additional 5% Franchise Fee Qualified employees could be absorbed by the private vendor Rural residents not willing to contract can still self haul 18

19. Free Trash Collection is no economically feasible to County or Haulers By assessing a fee at the transfer stations, resident choose what’s more beneficial Rural residents will be able to pay a smaller fee when they self haul by segregating trash and thus take less to the collection station. County will encourage recycling Haulers will find themselves with more residents on the open market looking for waste p/u thus encouraging more business Revenue stream over M/O could be used to offset cost attributed to Public Awareness, Clean-Up, Code Enforcement and other initiatives 19

20.  By modifying our current sanitation functions and responsibilities, Hidalgo County will be encouraging economic development, helping to reduce fiscal deficits and encouraging environmental awareness 20

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