The Clinton Herald, Clinton, Iowa

Top News

March 25, 2013

City to hear solid waste study results

CLINTON — The Clinton City Council during its Committee of the Whole meeting Tuesday night is expected to learn the results of a solid waste study that focuses on how the city’s solid waste services fund sank into red ink that is hovering around $1.8 million and how best to climb out of that hole.

What that study conducted by Springsted Inc. of St. Paul, Minn., shows is a plan that would bring the solid waste fund back into the black by 2018.

Much of the debt is the result of uncollected revenues and the purchase of $2 million in trucks and waste carts — capital purchases that had no established funding mechanism, the report states.

The solid waste fund saw negative operating income in fiscal years 2009 through 2012, with negative operating income projected in the 2013 budget. The report says that in addition to those operating deficits, the fund’s capital expenditures in 2011 and 2012 depleted its cash reserves, which went from $600,000 at the beginning of fiscal year 2010 to a negative position of about $1.85 million at the end of fiscal year 2012. The 2013 budget anticipates a more modest operating loss of $81,193, with little improvement in cash reserves that remain negative at about $1.8 million, the reports says.

The goal of the study is to address the major cash shortfall and examine ways for the city to ensure that its solid waste services support themselves and recover revenues sufficient to eliminate that shortfall and build a cash reserve.

“As a means of restoring cash reserves to the fund, we have estimated the city would be paying for debt service if it had  financed these capital purchases through the issuance of debt,” the report says.

The report shows that if these capital acquisitions had been financed over 10 years at 3 percent interest the annual payment would have been $292,286.

“If we include the $292,286 in our cost of services, it will combine with the current $142,447 in annual deprecation expenses to provide the enterprise with a cash surplus of $434,733 annually,” the report says. “We project that this would be sufficient to restore the solid waste fund to positive cash in 2018 and to have adequate cash reserves by 2019.”

Along with learning more about the fund's recent financial performance the council also will learn more details about the study's determinations concerning cost allocation and cost of service calculations.

Also on the committee of the whole agenda are discussion of a street vacation at 880 13th Ave. North to David Nelson, recreation department sponsorship and advertising, incentive pay for the city attorney and out of rank pay for acting department directors.

A SSMID II Fund designation request also will be discussed.

The committee of the whole meeting will follow the city council meeting, which starts at 7 p.m. Tuesday at Clinton City Hall.

Items on that agenda include a public hearing and motion concerning submission of Public Transit Grant applications, and a public hearing and action concerning the proposed form of contract and bond and estimated cost for HMA Resurfacing and Recycling Project F-2013.

The council will consider awarding that contract to Determann Asphalt Paving for $1,073,891.

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