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HomeMy WebLinkAboutMINUTES - 07211987 - 2.4 TQ, BOARD OF SUPERVISORS FROM: Phil Batchelor, County Administrator C itra Mark Finucane, Health Services Director DATE: July 20, 1987 co " ,lry SUBJECT: � Hazardous Waste Tax SPECIFIC REQUEST(S) OR RECOMMIENDATION(S) & BACKGROUND AND JUSTIFICATION RECOMMENDATIONS: 1. Conclude that because the hazardous waste tax has not been increased since 1984 it is timely to increase it and change the method of imposing the tax from a tonnage basis to a percentage of gross receipts. 2 . Acknowledge receipt of the attached draft ordinance increasing the hazardous waste tax to 100 of gross revenue, subject to defining precisely what is included in gross revenue, and order that the ordinance be placed on - the determination calendar for July 28, 1987 for introduction and on the agenda August 4 for adoption. 3 . Authorize the County Administrator, as a part of the Board' s 1988 Legislative Program, to seek amendments to SB 501 (Chapter 244, Statutes of 1981) such as to insure that the County will be able to continue to tax the operation of the IT facility in Martinez if and when its pending modernization is approved. 4. Request County Counsel to report to the Board on any current requirements that an owner of property. reveal to a prospective buyer of the property whether any hazardous waste may be located on the property and the extent to which the Board of Supervisors has jurisdiction to impose such a requirement. 5 . Request County Counsel to report to the Board on the extent to which the Board has the authority to increase the penalties for illegal dumping of hazardous wastes.. BACKGROUND: . On July 12, 1983 , the Board of Supervisors adopted Ordinance 83/26. The Ordinance established a tax on the disposal of hazardous waste at Class I landfills in Contra Costa County. This tax was imposed pursuant to legislation authored by Senator Boatwright--SB 501 (Chapter 244, Statutes of 1981) . ThJJJe tax is CONTINUED ON ATTACHMENT: _X YES SIGNATURE: "/ X RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COM�M��ITTEE X APPROVE OTHER ,SIGNATURE(S 1: ACTION OF BOARD ON July 21 , 1987 APPROVED AS RECr1A1ML.NDEO X OTHER VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A TRUE X UNANIMOUS (ABSENT ? AND .CORRECT COPY OF AN ACTION TARN AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN. CC: County Administrator ATTESTED �9f !deal th Services Director PiLB3TCELOR, CLERK OF THE BOARD OF County Counsel SUPERVISORS AND COUNTY ADMINISTRATOR IT Corporation Richmond Sanitary Service BY JKsf, ,DEPUTY M382/7-83 - Page 2 imposed on the two Class I sites in the County--IT' s facility near Martinez, and the Richmond Sanitary Service' s Class I facility in Richmond. Ordinance 83/26 specified that the tax was to be effective September 1, 1983 . The tax is due and payable monthly, 90 days after the end of the calendar month for which the tax is due. Initially, the tax was set at $2.25 per ton of untreated hazardous waste and $1.75 per ton of treated hazardous waste. The distinction in price was made to encourage the treatment of hazardous waste prior to disposal. Our records indicate that there was some difference of opinion on the Board regarding the level at which the tax should be imposed, as well as some considerable discussion about the methodology to be used. At the time the tax was originally imposed the amount of the tax was calculated on a dollar amount per ton, as was already being done in Solano County. Because the bulk of the revenue was expected to come from the IT Corporation, it was agreed to fix the tax at approximately the same level Solano County was then imposing on IT' s Benicia facility, which was $2.00 per ton. Rather than imposing a straight $2 . 00 per ton tax, the Board agreed to impose a differential tax depending on whether the hazardous waste was treated or untreated. This was done to encourage the treatment of hazardous waste prior to its disposal. Therefore, the initial tax was set at $2.25 per ton for untreated hazardous wastes and $1.75 per ton for treated hazardous wastes. At that time, Solano County estimated that their $2 . 00 per ton tax equalled about 6 percent of gross revenue. The tax was imposed effective September 1, 1983 and generated a monthly average of $27,859 in net revenue to the County during the 1983-1984 fiscal year. With the intense budget pressures facing the County at the beginning of the 1984-1985 fiscal year, every possible fee and tax revenue source was explored. One of these was an increase in the hazardous waste tax. Over the objections of industry, including those who would , ultimately have to pay the tax, the Board of Supervisors on October 16, 1984 increased the tax to $3 .47 per ton of untreated hazardous waste and $2 . 97 per ton of treated hazardous waste. These increases were made effective. December 1, 1984. It appears that the Board' s intent was to maintain the hazardous waste tax at a level which was comparable to that imposed by Solano County since IT operated facilities in both counties. During the 1982-83 fiscal year, Solano County' s tax was at $2.00 per ton. Their tax called for a maximum cap on revenue each fiscal year. This figure was adjusted annually based on the consumer price index. During the 1982-83 fiscal year, the maximum was $300,000. It was this $2.00 per ton figure that Contra Costa County used in initially setting the tax at $2. 25 per ton of untreated hazardous waste and $1.75 per ton of treated hazardous waste. Effective July 1, 1983, the Solano County tax increased to $2 . 30 per ton. Effective July 1, 1984, the Solano County tax increased to $2. 41 per ton and the maximum increased to $314,400. This is the level Solano County' s tax was when Contra Costa County increased their tax by 50o to $3 . 47 per ton of untreated hazardous waste and $2. 97 per ton of treated hazardous waste. Page 3 Effective July 1, 1985, Solano County' s tax was increased to $2. 55 per ton. Contra Costa County probably should have considered an increase in the tax during the 1985-86 fiscal year, but did not do so. In January, 1986, Solano County increased their tax to 10% of gross receipts. This tax continued only until the summer of 1986, at which point IT' s Benicia facility was ordered shut down by the State Department of Health Services. Contra Costa County was unaware that Solano County had increased their tax to a full 10% of gross revenue, a fact that probably will not occur again since the Boards of Supervisors are now holding joint sessions which encourages communications among county staff as well. The attached chart summarizes the rate of tax in Solano and Contra Costa counties. Although there is again resistance from industry to increasing the tax, this time to an absolute 10% of gross revenue, this office believes the County' s fiscal situation requires that we recommend such an increase. During the past year or so, each of the other counties has also increased its tax to 10% of gross revenue, although the precise definition of gross revenue has differed from county to county. County staff are still negotiating an appropriate definition of "gross revenue" with IT Corporation and will suggest a more specific definition when the Ordinance is before the Board for adoption next week. We have also asked County Counsel to explore the extent to which this tax increase can be imposed by the Board in the absence of a vote of the people. It appears that it must be placed on the ballot. The first opportunity to do this will be in November, 1987. h COMPARISON OF HAZARDOUS WASTE TAX IN SOLANO AND CONTRA COSTA COUNTIES SOLANO COUNTY CONTRA COSTA COUNTY Effective 10/1/82 $2. 00 per ton* Effective 7/1/83 $2. 30 per ton** Effective 9/1/83 $2. 25 per ton untreated $1.75 per ton treated Effective 7/1/84 $2 .41 per ton*** Effective 12/1/84 $3 .47 per ton untreated $2 . 97 per ton treated Effective 7/1/85 $2 . 55 per ton Effective 1/1/86 10% of gross revenue Effective Summer Facility closed of 1986 down by SDHS Order *$200,000 maximum **$300,000 maximum ***$314,400 maximum.