Agenda 09/24/2024 Item #16C3 (Resolution - FY 2025 Solid Waste Rate)9/24/2024
Item # 16.C.3.
ID#: 2024-937
Executive Summary
Recommendation to approve and adopt the FY2025 fee schedules established in the annual rate resolution for residential
and commercial collection and disposal of solid waste and recycling at Collier County Solid Waste Facilities, including
the landfill, transfer station, and recycling drop-off centers as presented in the FY2025 Solid Waste Budget.
OBJECTIVE: To adopt the Fiscal Year 2025 recommended fee schedules established in the annual rate resolution to
support the solid waste collection, disposal, and recycling needs of Collier County.
CONSIDERATIONS: On September 10, 2024, the Board approved resolutions establishing the residential assessment
rate for curbside collection services in municipal service collection Districts I and II for FY2025. In accordance with the
FY2025 budget, the residential annual assessment is $255.52 per unit in both Districts; an annual increase per unit of
$6.23 ($0.52 per month) from last fiscal year. The residential assessment provides the following best value service
levels: a garbage and recycling container for use at the assessed address; twice a week collection of garbage; once a
week collection of recycling, yard waste, and bulky items; and on demand collection of electronics, tires, and household
appliances.
In accordance with the FY2025 Solid Waste Budget, the tipping fees at the landfill and transfer station will increase by
an overall average of 2.5%. The tipping fees are supported by a 2025 Solid Waste Rate Study that was completed by
Raftelis Financial Consultants, Inc. who evaluated the cost of service for waste collection and disposal services and
provided rate recommendations to recover such costs and as well as to allocate those costs to specific tipping fees. Over
70% of the Solid Waste Division’s expenses are contractual costs that increase annually depending upon published
Consumer Price Indexes (CPI). For 2025, the CPI increase for the Landfill Operating Agreement rates paid to Waste
Management Inc. of Florida will be 2.9%. The rates incorporate sustainable and long-term strategic planning to
maintain a revenue structure that aligns with the Integrated Solid Waste Management Strategy’s Guiding Principles to
sustain environmental and growth management compliance, airspace preservation, operational excellence, and best
service values. These rates provide sufficient revenue to support Board approved service levels and escalation of
contracted service fees.
There are limited changes to the fees at the County owned and operated recycling drop-off centers. Most items are free
of charge for residents to drop-off at these centers. These centers provide proper disposal of hazardous and recyclable
materials, thereby safeguarding our fragile environment and preserving the County’s pristine paradise.
These fees provide the revenue necessary to support the cost associated to collect, process, recycle, and/or dispose, of
the wide range of waste generated in the county, including municipal solid waste, biomass (yard waste), construction
and demolition materials, white goods, bulky material, tires, electronics, household hazardous wastes, and recyclable
materials such as paint, cardboard, scrap metal, glass, and plastics.
FISCAL IMPACT: The proposed landfill tipping fees and recycling center fees will provide estimated FY2025
revenues of $33,999,900 (Collier County Landfill $30,465,400; Immokalee Transfer Station $3,312,700; recycling drop-
off centers $221,800); for the Solid Waste Disposal Fund (4070). The mandatory solid waste collection and disposal
assessments will provide estimated FY2025 revenues of $36,088,800 for the Mandatory Trash Collection Fund (4073).
GROWTH MANAGEMENT IMPACT: This rate resolution is in compliance with the Growth Management Plan,
which provides for increased recycling and reuse of the solid waste stream.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, is approved as to form and
legality and requires majority vote for approval. -JAK
RECOMMENDATIONS: Recommendation to approve and adopt the FY2025 fee schedules established in the annual
rate resolution for residential and commercial collection and disposal of solid waste and recycling at Collier County
Solid Waste Facilities, including the landfill, transfer station, and recycling drop-off centers as presented in the FY2025
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Solid Waste Budget.
PREPARED BY: Kari Hodgson, P.E., Director, Solid & Hazardous Waste Management Division
Bart Zautcke, C.P.A., C.M.A., Manager - Solid Waste Operations, Finance, Solid & Hazardous Waste Management
Division
ATTACHMENTS:
1. Fiscal Year 2025 Solid Waste Rate Resolution
2. Fiscal Year 2025 Solid Waste Rate Study
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Fiscal Year 2025 Solid Waste Rate Study
February 27, 2024
Collier County
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341 N. Maitland Avenue, Suite 300
Maitland, FL 32751
www.raftelis.com
February 27, 2024
Ms. Kari A. Hodgson, P.E.
Division Director
Collier County – Solid and Hazardous Waste Management Division
3339 Tamiami Trail East Suite 302
Naples, FL 34112
Subject: Fiscal Year 2025 Solid Waste Rate Study and Financial Forecast
Dear Ms. Hodgson:
Raftelis Financial Consultants, Inc. (Raftelis) has completed the 2025 Solid Waste Rate Study on behalf of the Collier
County Solid and Hazardous Waste Management Division (Division) of Collier County, Florida (County). We have
presented the results of our analyses, assumptions, and recommendations in this report for your consideration. The
focus of the Study was to develop a forecast of solid waste operations and the corresponding expenditures and
funding needs (revenue requirements) to evaluate the sufficiency of the solid waste system (System) revenues.
Additionally, Raftelis was tasked to evaluate the cost of service for waste collection and disposal services and provide
rate recommendations to recover such costs. The accounting period beginning October 1 and ending September 30
(Fiscal Year) for Fiscal Years 2024 through 2034 represents the Study Period. However, the Division is currently in
the process of developing a long-term integrated solid waste management plan and has contracts expiring within
the Study Period (e.g., residential and commercial waste collection and disposal), which may affect the study. As a
result, Fiscal Years 2024 through 2028 represent the Forecast Period for which rate adjustments have been identified.
Our recommendation is that proposed tipping fees for Fiscal Years 2025 through 2027 be adopted while, as required
by statute, all changes to the assessment be adopted annually.
Solid Waste Rate Revenue Adjustments [1]
Recommended Rate Adjustments
Description 2025 2026 2027
Tipping Fee Rate Revenue Adjustments [2] 2.5% 2.5% 2.5%
Assessment Rate Adjustments [3] 2.5% TBD TBD
__________
[1] Assumes implementation of rate adjustments at the beginning of each respective Fiscal Year. Additional rate
adjustments have been identified in future years.
[2] Reflects estimated annual increases in revenues assuming the adoption of the recommended tipping fees as discussed
later in this report.
[3] Changes in non-ad valorem assessments require annual adoption in accordance with Florida Statute. The County’s
franchise collection agreement expires September 30, 2027. Future increases to the assessment will be reviewed
annually and, where possible, based upon the terms of the eventual contract awarded for collection services.
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Ms. Kari A. Hodgson, P.E.
Collier County
February 27, 2024
Page 2
The following is a summary of the key Study findings:
The principal drivers of the identified rate adjustments are related to increased capital funding requirements
from rate revenues (referred to as pay-go capital funding), the continued need to fund the Debris Mission
Reserve Fund, inflationary effects on operating expenses, and the need to maintain adequate cash reserves
and compliance with the adopted budget policies.
In developing the recommended rates, the following criteria were used as guiding principles:
o Rates should be sufficient to recover the costs of providing service, including operating and
maintenance expenses, reserve policy requirements including those for hurricane debris
removal, and capital funding requirements.
o The rate structure should equitably recover costs among customer groups; those who benefit
from the service pay for the service.
o Rates should be comparable with those of other Florida integrated solid waste management
systems while still meeting the individual needs of the County.
A cost-of-service analysis was performed using Fiscal Year 2023 data, of which the general findings and
strategy developed is recommended to be implemented and is discussed later in the report. Increases to the
MSW tipping fees, among others, and a unification of residential and commercial tipping fees among MSW,
biomass, and tires are recommended.
Assuming implementation of the identified rate adjustments, the County’s residential assessment for solid
waste services is expected to remain below average compared to other surveyed solid waste entities.
However, it should be noted that the County’s franchise collection agreement expires September 30th, 2027.
Significant changes to the contractual costs of collection will impact the non-ad valorem assessment. The
financial forecast generally assumes a continuation of the existing contract terms with an allowance for
inflation as delineated within the existing franchise collection contracts. A separate sensitivity analysis has
been performed to identify the potential rate impacts of a range of potential collection costs based on recent
market benchmarking and discussions with staff.
The tipping fees are projected to remain above average compared to surveyed entities. However, several fees
including C&D, commercial biomass, and commercial tire tipping fees are all recommended to be held
constant over the next 3 fiscal years (2025 through 2027).
Based on our analysis and the assumptions relied upon as delineated in this Study, the identified rate
adjustments are expected to: i) ensure adequate funding for the projected funding requirements of the
System, including capital reinvestment; and ii) meet the County’s recommended financial targets and
adopted budget guidance goals.
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Ms. Kari A. Hodgson, P.E.
Collier County
February 27, 2024
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Following this letter is a summary report documenting recent trends, principal assumptions, and findings for your
consideration. As always, we appreciate the opportunity to be of service to the County and the fine cooperation and
valuable assistance given to us by County staff in the completion of the Study.
Sincerely,
RAFTELIS FINANCIAL CONSULTANTS, INC.
Thierry A. Boveri, CGFM
Senior Manager
Trevor McCarthy, CGFM
Senior Consultant
Maurizzio Onorato
Associate Consultant
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COLLIER COUNTY, FLORIDA
FISCAL YEAR 2025
SOLID WASTE RATE STUDY AND FINANCIAL FORECAST
TABLE OF CONTENTS
Title Page No.
Letter of Transmittal
Table of Contents ........................................................................................................................ i
PRIMARY ASSUMPTIONS AND RECOMMENDATIONS
General ............................................................................................................................................................ 1
Forecast of Revenues ........................................................................................................................................ 2
Customer and Demand Forecast .................................................................................................................. 2
Projected Revenues ...................................................................................................................................... 2
Forecast of Expenditures ................................................................................................................................... 3
Operating Expenses ..................................................................................................................................... 3
Capital Expenditures .................................................................................................................................... 4
Debris Mission Reserve Fund............................................................................................................................ 5
Principal Findings ............................................................................................................................................. 6
Cash Balances .............................................................................................................................................. 7
Cost of Service and Rate Design ........................................................................................................................ 8
Rate Comparison ........................................................................................................................................ 10
Collection Contract Sensitivity Analysis ........................................................................................................... 13
Areas of Concern/Focus .................................................................................................................................. 13
Conclusions and Recommendations ................................................................................................................. 15
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COLLIER COUNTY, FLORIDA
FISCAL YEAR 2025
SOLID WASTE RATE STUDY AND FINANCIAL FORECAST
General
Raftelis Financial Consultants, Inc. (Raftelis) has completed the 2025 Solid Waste Rate Study (Study) on behalf of
the Collier County Solid and Hazardous Waste Management Division (Division) of Collier County, Florida
(County). We have presented the results of our analyses, assumptions, and recommendations in this report for your
consideration. The focus of the Study was to develop a forecast of solid waste operations and the corresponding
expenditures and funding needs (revenue requirements) to evaluate the sufficiency of the solid waste system (System)
revenues. Additionally, Raftelis was tasked to evaluate the cost of service for waste collection and disposal services
and provide rate recommendations to recover such costs. The accounting period beginning October 1 and ending
September 30 (Fiscal Year) for Fiscal Years 2024 through 2034 represents the Study Period. However, the Division is
currently in the process of developing a long-term integrated solid waste management plan and has contracts expiring
within the Study Period (e.g., residential and commercial waste collection and disposal), which may affect the study.
As a result, Fiscal Years 2024 through 2028 represent the Forecast Period for which rate adjustments have been
identified. Although rate adjustments are identified below, our recommendation is that proposed tipping fees for
Fiscal Years 2025 through 2027 be adopted while, as required by statute, all changes to the assessment be adopted
annually. The primary goals and objectives of the Study were to:
Evaluate the sufficiency of System revenues derived from existing disposal and assessment rates and identify
rate adjustments, if necessary, to fund the projected expenditures and funding requirements from rates.
Develop a pay-go capital funding plan that would fully support the financing of the Division’s capital
improvement plan (CIP) during the Forecast Period.
Maintain compliance with and meet or exceed financial policy requirements as delineated in the adopted
Fiscal Year 2024 Budget Policies, including providing annual transfers to the Debris Mission Reserve Fund.
Evaluate and make recommendations regarding adjustments in tipping fees based on the cost-of-service
analysis as performed as part of this Study.
Present scenarios of potential rate increases related to the residential non-ad valorem assessment upon the
expiration of the Division’s franchise collection agreements on September 30, 2027.
The financial forecast was developed based on information provided by County staff including, but not limited to:
i) detailed collection and disposal statistics to identify service area demands and trends; ii) the Fiscal Year 2024
capital improvement plan; iii) the Fiscal Year 2024 operating budget as adopted by the Board of County
Commissioners (BOCC); iv) financial and operational results for Fiscal Year 2023; and v) other financial or statistical
information.
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Forecast of Revenues
The revenues for the System are principally generated from the rates for solid waste service, which include revenues
from disposal tipping fees and the annual residential assessment for collection and disposal services. Such revenues
account for approximately 94% of gross revenues over the Forecast Period, while the balance of gross revenues (6%)
is generated from miscellaneous service charges, scrap sales, franchise fees, and interest income on investments.
Since most of the System revenues are generated from tipping fees and the annual residential assessment, the forecast
of revenues is primarily determined by projections of the estimated number of customers receiving service and their
demands (i.e., waste disposed).
CUSTOMER AND DEMAND FORECAST
The forecast of solid waste service revenues relied upon a review of recent historical trends in solid waste customer
account growth and tonnage statistics. The following table provides a summary of projected trends in solid waste
customer billing statistics:
Solid Waste System Billing Statistics [1]
Fiscal Year
Average Annual
Residential Accounts [2]
Waste Disposed
(Tons)
2024 143,927 530,850
2025 147,033 535,208
2026 149,970 541,840
2027 152,905 548,489
2028 155,867 555,193
Annual Growth 2.01% 1.13%
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[1] Based on historical data and population projections provided by the County.
[2] Represents average annual residential accounts for District I and District II.
Based on discussions with County staff and County population estimates, it is assumed that the County may expect
to experience average annual growth in customer accounts of approximately 2.0% per year for the Forecast Period.
Waste generation from Fiscal Years 2024 through 2028 is expected to increase at a rate of approximately 1.1% per
year as not all waste types (e.g., construction and demolition debris, biomass, tires) are anticipated to increase at the
same rate as residential customer growth. In Fiscal Year 2023, the County experienced higher C&D tonnage than
recent trends, which is likely attributable to the effects of Hurricane Ian. The forecast assumes a return to levels more
closely aligned with historical trends beginning Fiscal Year 2024.
PROJECTED REVENUES
The revenue forecast was based on: i) review of historical trends in revenues; ii) Fiscal Year 2024 operating budget;
iii) year-to-date operating results for Fiscal Year 2024; iv) customer and demand forecast as previously discussed;
v) assumed implementation of identified rate adjustments to fund the projected revenue requirements; and
vi) discussions with County staff. The following table provides a summary of projected revenues at proposed rates
over the Forecast Period.
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Projected System Revenues at Proposed Rates
Fiscal Year
Rate Adjustment
Disposal Rate
Revenues
Assessment
Rate Revenues
Other
Revenues [3] Total Revenues Disposal [1]
Assessment
[2]
2024 N/A N/A $32,401,335 $34,711,263 $4,240,831 $71,353,429
2025 2.5% 2.5% 33,553,261 36,344,873 3,972,366 73,870,499
2026 2.5% 2.5% 34,984,268 37,995,674 4,029,053 77,008,995
2027 2.5% 2.5% 36,475,402 39,706,005 4,146,530 80,327,937
2028 2.0% 2.5% 37,823,739 41,485,316 4,273,679 83,582,734
CAGR[4] 3.94% 4.56% 0.19% 4.03%
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[1] Based on estimated annual increases in rate revenues assuming implementation of the tipping fees discussed later in this report.
[2] Projected rates do not incorporate the anticipated effects associated with the expiration of the existing collection contract on
September 30, 2027.
[3] Amounts shown include revenues not derived from user rates such as landfill gas to energy sales, commercial franchise fees,
residential franchise fees, recycling revenues, and investment income.
[4] Represents the compound annual growth rate of each category of revenues.
Forecast of Expenditures
The Forecast Period expenditures can be categorized into three primary groups: operation and maintenance
(operating) expenses, capital funding, and transfers. Currently, operating expenses account for the majority or 92%
of gross revenue requirements, while transfers to fund capital reinvestment account and debris mission reserve fund
transfers account for the remaining 8%.
OPERATING EXPENSES
The forecast of operating expenses was developed based upon: i) a review of the recent trends in historical expenses;
ii) the adopted Fiscal Year 2024 budget and subsequent amendments; iii) assumed growth rates / escalation factors
of costs based on industry trends, projections of inflation by the Congressional Budget Office, and other resources;
and iv) discussions with County staff. The following chart presents the forecast of operating expenses:
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The principal operating expenses include contract collection services, contract disposal operations, and personnel,
with contracted disposal and collection accounting for approximately 70% of total operating expenses. The contracts
include the County’s landfill operating agreement with Waste Management and collection agreements with Waste
Management (District I) and Waste Pro (District II). As is common among these types of contracts, provisions allow
for the annual indexing of rates charged to the County. Thus, 70% of the System’s operating expenses are
automatically indexed by inflation and not within the control of County staff. The forecast of contractual operating
expenses has been escalated for the Forecast Period consistent with the index provisions prescribed in each contract
and estimates thereof. Other operating expenses relied upon various escalation factors ranging from approximately
2.0% to 5.0% depending on the assumed costs being escalated. Furthermore, budgeted departmental capital outlays
were reclassified as a capital expenditure included in the CIP.
Overall, operating expenses are projected to increase by an average annual rate of approximately 3.9% per year. It
should be noted that the projection of operating expenses assumes a continuation of the existing franchise collection
contracts, which expire September 30, 2027, plus an allowance for inflation as delineated within the existing
contracts. A separate sensitivity analysis has been performed to identify the potential rate impacts of a range of
potential collection costs based on recent market benchmarking and discussions with staff.
CAPITAL EXPENDITURES
Capital reinvestment and funding is integral to the continuity and quality of service delivered to customers. These
expenditures, coupled with the need to meet the growth requirements of the System, contributed to the capital
improvement plan developed by County staff.
The majority of the capital funding is associated with the renewal, replacement, rehabilitation, upgrade, and
betterment (renewals and replacements) of the existing infrastructure. The CIP also includes capital funding
associated with new infrastructure and System expansion. Major projects in the CIP include: i) master planning and
upgrade of the Immokalee site; ii) maintenance of the deep injection well for leachate disposal; iii) regular
maintenance on solid waste facilities iv) expansion and optimization of the Collier County Landfill; v) access and
planning of the Resource Recovery Business Park. The total programmed capital expenditures are estimated at
approximately $44.2 million during the Forecast Period and averages approximately $8.8 million annually. Estimates
of annual capital spending provided by Division staff have been escalated by 3.5% annually beginning in Fiscal Year
2025 to provide an allowance for inflation. The chart below provides a summary of the capital expenditures, capital
fund cash reserves, and deposits to the capital fund for the Forecast Period:
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All identified funding requirements are anticipated to be financed from internal sources derived from existing cash
reserves and programmed transfers from rate revenues to the Solid Waste Capital Fund. The CIP is a planning
document, which is presented on an appropriations basis, and the timing and completion of projects are subject to
changes or delays. As a result, it is recommended that staff continue to annually re-evaluate the financial forecast
and the need for adopted or additionally identified rate adjustments.
A major driver regarding the need for additional rate adjustments are the required deposits for capital reinvestment
from rate revenues (i.e., pay-go). The recommended rates generate an average of approximately $5.6 million per year
of pay-go funding over the forecast period and, when combined with the use of cash reserves, fully fund the capital
improvement program.
Debris Mission Reserve Fund
During Fiscal Year 2023, Raftelis was tasked with providing hurricane reserve policy recommendations for the
Division. Publicly available data from the National Oceanic and Atmospheric Administration (NOAA) on hurricane
frequency and data from FEMA regarding debris removal claims and reimbursements were analyzed and used to
develop a recommended range of cash reserves. It is recommended that the County continue building the Division’s
debris mission reserve equal to 10% of solid waste revenues, within a minimum and maximum range of $7 million
to $10.5 million in today’s dollars. It is further recommended that the County consider annually adjusting the reserve
target for inflation with an overall reassessment of the policy requirements every 5 years. For the purposes of this
study, annual transfers of $1.5 million have been recognized. Should the County reach or exceed the minimum
threshold of recommended reserves, future deposits to the Debris Mission Reserve fund could be reduced to a range
of $390,000 to $875,000.
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Principal Findings
Based on the key assumptions of the Study, the following rate revenue increases have been identified to fund the
projected needs of the System over the forecast period:
The following charts provide a breakdown of the projected revenue requirements for both the Disposal Fund (4070)
and Mandatory Trash Collection Fund (4073). These projections assume 2.5% annual increases in Fund 4073 rates
and do not incorporate the impact of the new residential collection contract when the current one expires on
September 30, 2027.
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Solid Waste Rate Revenue Adjustments [1]
Identified Rate Adjustments
Description 2025 2026 2027 2028
Tipping Fee Rate Revenue Adjustments [2] 2.5% 2.5% 2.5% 2.0%
Assessment Rate Adjustments [3] 2.5% TBD TBD TBD
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[1] Assumes implementation of rate adjustments at the beginning of each respective Fiscal Year. Additional
rate adjustments have been identified in future years.
[2] Reflects estimated annual increases in revenues assuming the adoption of the recommended tipping fees
as discussed later in this report.
[3] Changes in non-ad valorem assessments require annual adoption in accordance with Florida Statute.
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The identified rate adjustments have been estimated to produce sufficient revenues to meet the needs of the System
during the Forecast Period. The primary drivers of the projected increases in gross revenue requirements are due to
the effects of inflation on operating and maintenance expenditures, pay-go funding required to fund the capital
improvement program, the need to fund a hurricane reserve fund, and the need to maintain adequate operating
reserves and compliance with the County’s adopted budget policies.
Though rate increases through Fiscal Year 2028 have been identified, we recommend tipping fees for Fiscal Years
2025 through 2027 be adopted in conjunction with the rate design recommendations as discussed subsequently in
this report. Furthermore, as required by statute, all changes to the assessment must be adopted annually.
CASH BALANCES
The following table provides a summary of the projected cash balances by fund:
Summary of Projected Ending Balances by Fund ($000s) [1]
Fiscal Year Ending September 30,
Description 2024 2025 2026 2027 2028
Fund 4070 – Solid Waste Disposal $10,284 $10,116 $10,148 $10,498 $10,789
Fund 4071 Landfill Closure and Debris Mission Reserves 1,830 3,355 4,896 6,453 8,025
Fund 4073 – Mandatory Trash Collection [2] 12,946 13,624 14,382 14,949 15,767
Fund 4074 – Solid Waste Capital Projects 16,954 11,901 10,886 12,510 11,218
Total Fund Balance $42,015 $38,997 $40,312 $44,410 $45,799
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[1] Represents the projected ending cash balances in each respective year of the forecast.
[2] Reflects cash balances assuming 2.5% annual increases in non-ad valorem assessment are adopted annually through the
forecast period. Reserves are assumed to allow for the mitigation of rate increases as a result of the new franchise collection rates
that will be in place by fiscal year 2028. Additional adjustments will be necessary.
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As shown in the table above, it is anticipated that the use of existing cash reserves in Fund 4074 to finance the capital
needs of the System will be required. However, overall cash balances are projected to increase during the Forecast
Period primarily due to: i) the revenue requirements associated with funding the Debris Mission Reserve fund; ii) the
surplus generated to maintain the unrestricted reserve target of 45 to 90 days of operating expenses established by
adopted budget guidance policies; iii) the anticipated reimbursement from FEMA for debris removal costs associated
with Hurricane Ian assumed during Fiscal Year 2027; and iv) the assumed 2.5% annual adjustment to the residential
assessment (which is proposed for Fiscal Year 2025, subsequent years considered for adoption by the Board annually)
produces a surplus over the forecast period and may help mitigate the effects of anticipated increases in costs
associated with the expiration of the County’s contract hauler agreements on September 30, 2027.
Cost of Service and Rate Design
A preliminary cost-of-service analysis was completed during Fiscal Year 2023 to form the basis of the approach and
strategy from which the following recommendations were derived. Based on the projected revenue requirements and
identified rate adjustments, the existing rate structure was evaluated using cost-of-service principles. Municipal solid
waste (MSW), C&D, biomass, and tires are generally the primary waste streams within the County and were the
focus of this analysis.
Costs were allocated by budgetary line item to the various charges based on a rational nexus among the costs and
the respective fees. Adjustments to the allocated rates were then made to recognize: i) benefits of an integrated solid
waste operation; ii) market comparisons; iii) the existing rate structure and a phased approach to implementation of
rates; and iv) general rounding of calculated rates to the nearest cent.
Fiscal Year 2027 serves as the Test Year, which is the year for which rates were designed and calculated based upon
the projected revenue requirements identified during that year. In conjunction with the assumed uniform annual
increases of 1.5% per year for rates not identified below, the recommended rates produce annual tipping fee
revenue increases of approximately 2.5% per year. The following table presents the allocation of revenue
requirements by cost center and other major revenue requirement categories, adjustments as previously discussed,
and the recommended phased implementation plan.
Rate Design Results for Test Year 2027 ($000's) [1]
Description
Res
MSW
Com
MSW C&D
Res
Biomass
Com
Biomass
Res
Tires
Com
Tires Total
Net Revenue Requirements $15,946 $14,114 $3,579 $844 $391 $20 $126 $35,019
Adjustments (2,452) 2,033 271 73 58 2 15 0
Adjusted Net Revenue
Requirements $13,494 $16,148 $3,850 $917 $449 $22 $140 $35,019
Billing Units (Tons) 146,494 175,303 39,890 15,947 7,807 94 594
Calculated Rates FY27 $92.11 $92.11 $96.52 $57.48 $57.48 $235.74 $235.74
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[1] All tipping fees for material classes not shown above and those not equivalent to existing fiscal year 2024 rates shown above are assumed
to increase uniformly by 1.5% per year for fiscal years 2025 through 2027.
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As shown in the prior table, the following rate structure changes have been recognized:
The residential and commercial MSW tipping fees are unified into a single rate acknowledging the results of
the cost-of-service analysis and both the environmental and economic benefits of the recycling and disposal
facilities as well as the County services and programs that are shared across customer classes.
The C&D tipping fee is held constant at the Fiscal Year 2024 rate through Fiscal Year 2027.
The residential tire and residential biomass tipping fees are increased up to the existing Fiscal Year 2024
commercial tire and biomass tipping fees, respectively. The commercial biomass and tire tipping fees are
held constant.
The table below shows the recommended phased rates for fiscal year 2025 through fiscal year 2027. All tipping fees
not listed below are assumed to increase by 1.5% per year fiscal years 2025 through 2027. Together, the recommended
rates are anticipated to produce approximately 2.5% per year in additional rate revenues.
Recommended Phased Tipping Fees for FY25 – FY27
Description 2024 2025 2026 2027
Annual %
Change
Residential MSW $80.85 $84.44 $88.19 $92.11 4.44%
Commercial MSW 86.91 88.61 90.34 92.11 1.96%
C&D 96.52 96.52 96.52 96.52 0.00%
Residential Biomass 52.40 54.04 55.73 57.48 3.13%
Commercial Biomass 57.48 57.48 57.48 57.48 0.00%
Residential Tires 223.12 227.25 231.46 235.74 1.85%
Commercial Tires 235.74 235.74 235.74 235.74 0.00%
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RATE COMPARISON
For the purposes of this analysis, a comparison of solid waste charges (annual residential charges and commercial
tipping fees) with other solid waste entities was prepared to provide an indication of the competitiveness of the
existing rates charged by the County. Based on this comparison, the proposed residential assessment will remain
below the survey average. While the commercial tipping fees remain modestly above average, the recommendation
includes maintaining all but the commercial MSW rate at the existing (fiscal year 2024) fee level through fiscal year
2027.
Comparison of Solid Waste Residential Assessments and Commercial Tipping Fees [1]
Description
Residential
Annual Charges MSW C&D Yard Waste Tires
Collier County:
Existing Rates $249.29 $86.91 $96.52 $57.48 $235.74
Proposed Rates FY25 255.52 88.61 96.52 57.48 235.74
Oher Solid Waste Entities:
Broward County $487.00 $65.00 $65.00 $50.00 $130.00
Charlotte County 292.28 39.28 39.28 39.28 125.46
Hillsborough County 437.51 104.60 77.48 48.11 186.25
Lee County 307.06 63.56 63.94 39.97 160.00
Manatee County 283.80 40.00 61.00 40.00 86.00
Miami-Dade County 509.00 107.80 107.80 107.80 140.00
Monroe County 457.15 136.00 136.00 136.00 136.00
Palm Beach County 466.33 42.00 65.00 35.00 100.00
Sarasota County 233.59 59.08 58.19 46.05 290.61
Other Florida County Averages $385.97 $73.04 $74.85 $60.25 $150.48
__________
[1] Reflects current rates for service as of October 2023.
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Collection Contract Sensitivity Analysis
Collier County’s existing residential franchise collection contract expires on September 30, 2027. Based on recent
market bids and recently negotiated contract rates obtained by other local governments with similar contractual
arrangements, a sensitivity analysis was performed to provide a range of potential costs. Four scenarios were
developed as follows:
Scenario 1: Assumes a Fiscal Year 2028 collection rate of $259.00 per residential unit estimated based on a
review of market rates. Scenario 1a assumes a single adjustment in Fiscal Year 2028 while Scenario 1b
recognizes a 3-year phased approach beginning in Fiscal Year 2027.
Scenario 2: Assumes a collection rate of $194.00 in Fiscal Year 2028 based upon the initial Collier County
franchise collection rate adjusted for inflation as measured by the BLS Garbage and Trash Collection Index
and estimates thereof through Fiscal Year 2028. Scenario 2a assumes a single adjustment in Fiscal Year
2028 while Scenario 2b recognizes a 3-year phased approach beginning in Fiscal Year 2027.
Scenario Analysis - Rate Increase Assumptions
Fiscal Year Ending September 30,
Description 2025 2026 2027 2028 2029
Scenario 1 - Market Survey [1]
a. Single Increase 2.50% 2.50% 2.50% 47.00% 2.00%
b. Phased Increase 2.50% 2.50% 15.25% 15.25% 15.25%
Scenario 2 - Inflation Adjusted [2]
a. Single Increase 2.50% 2.50% 2.50% 22.50% 2.00%
b. Phased Increase 2.50% 2.50% 8.50% 8.50% 8.50%
__________
[1] Rate adjustments needed to cover collection contract cost of $259.00 per year beginning October 1, 2027.
[2] Rate adjustments needed to cover collection contract cost of $194.00 per year beginning October 1, 2027.
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Areas of Concern/Focus
1. Current contractual agreements with the County’s waste haulers will expire on September 30, 2027. Prior to
the contracts expiring, the County will either rebid or renegotiate the existing collection hauling contracts,
which is anticipated to begin as early as the current Fiscal Year. The County’s current contract rate is below
the average market rate of recently awarded contract rates. Changes to the collection contract will have a
material impact on operations, operating expenses, and future rate adjustments.
2. Recycling markets have been declining and processing costs have been increasing. Depending on the way
recyclables are handled under the waste hauler contracts in place after September 30, 2027, additional
operating costs may be incurred.
3. Any potential changes to permitted landfill height would reduce the life of the landfill and over time would
either require expansion (i.e., additional capital investment) or disposing of waste out of County at an
increased operating cost. The latter option would nearly double disposal costs under existing contracts and,
given the effects of rapid population growth contributing to increased demand for essential services and
evolving regulatory requirements, establishing alternative contractual disposal means could prove
significantly more costly than options under existing contractual arrangements.
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Conclusions and Recommendations
Based on the assumptions, considerations, and analyses as summarized herein, we are of the opinion that:
1. The County's existing rates for service are not anticipated to recover the projected revenue requirements
(System expenditure and funding needs) for the Forecast Period. Therefore, as of the date of this report, the
following rate revenue adjustments for solid waste service are identified.
a. It is recommended that the identified tipping fee adjustments for Fiscal Year 2025 through 2027 be
considered for adoption.
Identified Solid Waste Tipping Fee Revenue Adjustments [1]
Identified Rate Adjustments
Description 2025 2026 2027 2028
Tipping Fee Rate Revenue Adjustments [2] 2.5% 2.5% 2.5% 2.0%
__________
[1] Assumes implementation of rate adjustments at the beginning of each respective Fiscal Year.
[2] Reflects estimated annual increases in revenues assuming the adoption of the recommended tipping
fees as discussed previously in this report.
b. It is recommended that the assessment adjustments for Fiscal Year 2025 shown below be considered for
adoption while future rate increases will ultimately depend upon the new contractual agreement and
eventual franchise collection rates adopted by the County.
Identified Solid Waste Assessment Revenue Adjustments
Identified Rate Adjustments
Description 2025 2026 2027 2028
Assessment Rate Adjustments [1] 2.5% TBD TBD TBD
__________
[1] Changes in non-ad valorem assessments require annual adoption in accordance with Florida Statute.
The County’s franchise collection agreement expires September 30, 2027. Future increases to the
assessment will be reviewed annually and, where possible, based upon the terms of the eventual
contract awarded for collection services.
2. A cost-of-service analysis was performed and considered along with the strategic goals of the County. It is
recommended that the calculated tipping fees for the forecast period be considered for adoption.
3. The projected results and assumptions contained in this Study may vary from actual results. As such, County
staff should continue to perform annual evaluations to validate that the identified rate adjustments will be
sufficient to meet the needs of the System.
Page 2968 of 4908
Table 1
Collier County Solid and Hazardous Waste Management Department
2025 Rate Study
Solid Waste Financial Dashboard
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($ Thousands)1) Revenue Requirements - Fund 4070: Solid Waste Disposal
Operating Expenses Capital Transfers
Interfund Transfers (Non-Capital)Debt Service
Transfer to General Fund Transfer to County-Wide CIP
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
$45,000
$50,000
$55,000
$60,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($ Thousands)2) Revenue Requirements - Fund 4073: Mandatory Trash Collection
Operating Expenses Capital Funded from Rates
Disposal Expense (Transfer to Fund 4070)Capital Transfers
Interfund Transfers (Non-Capital)Debt Service
Projected Revenue Under Existing Rates Projected Revenue Under Proposed Rates
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($ Thousands)3) Ending Cash Balance - Fund 4070 Solid Waste Disposal
Working Capital Cash Balance 45 Days of O&M 90 Days of O&M
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($Thousands)4) Ending Cash Balance - Fund 4073 Mandatory Trash Collection
Working Capital Cash Balance 45 Days of O&M 90 Days of O&M
-Collection contract expires end of FY2027
-Average collection costs appox. $9 per month
-Current negotiated rates avg ~$20 per month
Page 1 of 3
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Table 1
Collier County Solid and Hazardous Waste Management Department
2025 Rate Study
Solid Waste Financial Dashboard
$0
$5,000
$10,000
$15,000
$20,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($ Thousands)7) Ending Cash Balance - Fund 4074 Solid Waste Capital
Projects
Ending Cash Balance - Disposal Ending Cash Balance - Collection
Deposits - Disposal Deposits - Collection
Capital Spending
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($ Thousands)8) Capital Improvement Program Funding Summary
Fund 4074 Cash Reserves Airspace Recovery Fund Transfers Capital Funded from Rates
Rate Revenue - Tipping Fees Fund 4070 Cash Reserves Fund 4073 Cash Reserves
Previously Issued Debt Outside Agency Grants Rate Revenue - Collections
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Amount ($ Thousands)5) Ending Cash Balance - Fund 4074 - Disposal
Ending Cash Balance - Disposal Deposits - Disposal Capital Spending - Disposal
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
Amount ($ Thousands)6) Ending Cash Balance - Fund 4074 - Collection
Ending Cash Balance - Collection Deposits - Collection Capital Spending - Collection
Page 2 of 3
Page 2970 of 4908
Table 1
Collier County Solid and Hazardous Waste Management Department
2025 Rate Study
Solid Waste Financial Dashboard
$0
$10,000
$20,000
$30,000
$40,000
$50,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($ Thousands)9) Summary of Cash Balances (Excluding Fund 4071)
Fund 4074 - Solid Waste Capital Projects - Mandatory Collection
Fund 4074 - Solid Waste Capital Projects - Disposal
Fund 4073 - Mandatory Trash Collection
Fund 4070 - Solid Waste Disposal
90 Days of O&M
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount( $ Thousands)10) Pay-Go Funding - Disposal Fund
Total Pay-Go Funding - Fund 470
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
$20,000
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034Amount ($ Thousands)11) Debris Mission Reserve Fund 4071
Ending Fund Balance Target - 10% of Revenues
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
12) Net Revenue Margin Fund 4070
Existing Rates Proposed Rates
Page 3 of 3
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