Waste Management faces possible $6M budget shortfall
Published: April 24, 2014
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ST. THOMAS - V.I. Waste Management Authority Executive Director May Adams Cornwall told the board Wednesday that the agency may be losing about $6 million in special fund allotments.
Cornwall said she is working with the V.I. Finance Department and the Office of Management and Budget on the matter and is hopeful that some sort of resolution can be reached before the end of the year.
The Waste Management Authority already is suffering the same General Fund allotment budget cuts as all other departments - about a 6 percent budget reduction.
However, the allotments from the three special funds that support the agency's operations also have dried up, at least for the foreseeable future.
Cornwall said the annual budget is dependent on four special funds: the Anti-litter and Beautification Fund; the Tourism Advertising Revolving Fund; the St. John Capital Improvement Fund; and the Sewer and Waste Water Treatment Fund.
The Waste Management Authority was appropriated $300,000 from the Tourism Advertising Revolving Fund to help with the clean-up and trash removal associated with each island's Carnival activities, according to Cornwall. Typically, Waste Management gets a quarterly allotment of about $75,000, she said.
For the first quarter, they got $72,500 and did not receive anything for the second quarter.
"I can't issue contracts without money," Cornwall said.
To get the job done, money will have to be funneled from another source, and Cornwall said she is working with her staff on what services will be cut to make room in the budget for Carnival clean-up.
It was a similar story with the Anti-litter and Beautification Fund. Typically, the Waste Management Authority receives about $3.1 million, Cornwall said. The agency got the first allotment of about $275,000, but again, no second-quarter allotment was received, she said.
That money covers salaries for the environmental enforcement officers and compliance officers, as well as for some solid waste division employees and services, such as the scrap metal program.
The Waste Management Authority also typically gets about $3 million a year from the Sewer and Waste Water Treatment Fund - which is a surcharge on property tax bills - Cornwall said.
"They have told us we're not getting any of it," she said.
V.I. Finance Commissioner Angel Dawson Jr. and Office of Management and Budget Director Debra Gottlieb told The Daily News on Wednesday that the reason no money has been released from that fund is because the government has not issued any property tax bills yet this fiscal year.
Two bills will be sent out this year, the 2013 and the 2014 bills, Gottlieb said. It is a revaluation year, so the bills have been delayed, she said.
The Lt. Governor's Office expects the 2013 bills to go out by June and is planning to send the 2014 bills out in August, according to Gottlieb.
Dawson and Gottlieb said that the lack of allotments does not mean there is no money in the fund but that the fund is clogged up by encumbrances from other departments and agencies. They said they are working with those agencies to liquidate any unnecessary encumbrances to perhaps free up money in the fund, which then could be released to the Waste Management Authority.
However, time is an issue. The money from the Sewer and Waste Water Treatment Fund is needed to pay the contractor that operates two of the territory's wastewater treatment plants, Red Point on St. Thomas and Anguilla on St. Croix, she said. It also covers generator maintenance at the plants and the purchase of chemicals needed to treat and suppress odor.
"We're concerned though, if we do not pay for these costs, we will not be in compliance with the consent decree," Cornwall said.
The V.I. government has been under a consent decree for violations to the Clean Water Act for many years.
Cornwall told the board Wednesday that while the Waste Management Authority is moving toward the implementation of special waste fees and tipping fees, they may not be in place soon enough to close the budget gap in this fiscal year.
The agency plans to file a petition with the Public Services Commission by the end of the month to implement special waste fees, which are assessed when certain items are brought into the territory. Cornwall said if the petition goes through as proposed, it would bring in about $2.7 million a year.
The Waste Management Authority also is working on developing tipping fees, a fee based on the weight of waste dropped off at the landfills. Cornwall said that proposal should be delivered to the Public Services Commission by the end of May.
She did not have an estimate for annual revenue generated by the tipping fees.
"I think we're the last jurisdiction in the United States to have a tip fee," Cornwall told the board.
She said if the application process goes smoothly, the new tipping fees could be in place by August, which would help address the General Fund budget cuts for this year, but not the missing special funds.
- Contact reporter Aldeth Lewin at 714-9111 or email email@example.com.