Nevada Division of Environmental Protection - Bureau of Waste Management

2007 Solid Waste Management Plan

4.7 State and Local Funding

4.7.1 Solid Waste Management Authorities
Funding for solid waste management is provided primarily through the $1 fee (Tire Fee) per tire sold at retail collected by the State Department of Taxation, and distributed as follows:

Figure 7 shows tire fee revenue by fiscal year from 1994 to 2006. The upward revenue trend of 5.9% average per year from 1994-2006 is higher than the growth in Nevada's population of 5.0% average per year (Nevada State Demographer data 1994 - 2006). The upward trend in tons of solid waste disposed, 9.3% average per year from 1994-2006, is due to a combination of increasing waste importation and to the increasing construction/demolition (C&D) wastestream resulting from the construction related to Nevada's high growth rate (see Figure 3). In 1994, Tire Fee revenue brought in about 32¢/ton of waste disposed; twelve years later (2006) it amounts to 22¢/ton (Figure 8). The upper curve in Figure 8 shows the change in ratio of Tire Fee revenue per ton of waste disposed. The lower curve is the same ratio adjusted for an average inflation rate of 2.7% annually showing the original 32¢/ton in 1994 declining to 15¢/ton in constant dollars, yielding more than a 50% decrease in revenue per ton of waste disposed in 2006.

Figure 7. Revenue collected from tire fee for fiscal years 1994 to 2006.

Figure 8. Trend of revenue collected for each ton of solid waste disposed. The red line is deflated pursuant to the average inflation rate of 2.7 for years 1994-2006 (U.S. Department of Labor, Bureau of Labor Statistics, not seasonally adjusted, West urban, all items)

While the above revenue-to-waste analysis suggests that the Tire Fee revenue may have eroded to the point of insufficiency, it should be noted that the costs to regulate solid waste are not proportional to the tonnage disposed. Regulatory costs are more likely to be influenced by the number and types of facilities, and the quality, diversity and sources of solid waste.

In an attempt to address solid waste management funding needs while ensuring that imported waste supports its share of the cost for solid waste management, the NDEP proposed a modest tipping fee in the 72nd Nevada Legislative Session (2003). The proposal didn't receive the necessary support, however, and died in committee. The concept of charging a fee on waste to regulate waste is a logical revenue structure and one that has worked in many other States. It also has the added advantage of capturing revenue from imported waste, something that the current Tire Fee does not do.

The Nevada 73rd Legislature (2005) passed SB 396 (NRS 444.560, see Appendix 5), which included a provision to allow the SEC to establish a schedule of fees for disposal of solid waste or for the issuance of permits or other approvals for the operation of solid waste management facilities. This means of enhancing and maintaining program revenue has always been available to the Health Districts, both of which have supplemented the Tire Fee revenue with permit fees for solid waste haulers and management facilities. NRS 444.560 (Appendix 5) provides the opportunity to collect fees to provide a revenue supplement to the NDEP's solid waste program.

4.7.2 Local Government
Local government has the responsibilities of municipal solid waste planning, recycling program development and implementation, public information and the prevention of illegal dumping. Additionally, most of Nevada's rural governmental entities own and operate their community disposal sites. Local solid waste management may be funded through disposal fees at the landfill gate, property tax assessments, from the general fund, or a combination of these.

The high cost to operate a municipal landfill in compliance with State and Federal regulations has driven the closure of most rural landfills, leaving the remote communities faced with the dilemma of either paying for a landfill or for long-distance waste transportation. In some counties, budget shortages have led to inadequate staffing, lack of training and equipment, and insufficient operating funds; conditions that have contributed to rural landfills operating in minor violation of regulations and permit requirements.

Several rural local governments are exploring waste importation as a strategy to generate revenue, not only for their solid waste management programs, but also for general fund enhancement. When developing importation strategies, a municipality can either establish and operate its own commercial landfill, or negotiate a "host" fee with a private landfill developer that generates revenue for the County/municipality based on the tons of waste received at the landfill.

4.7.3 Items for future consideration, Sec. 4.7 - State and Local Funding

1. Evaluate funding sources and costs for solid waste management for each rural county to determine the need for financial assistance to rural local governments for solid waste management.

2. In the future the NDEP may be required to petition the SEC for authority to collect fees, pursuant to NRS 444.560 (Appendix 5), to defray the costs of managing and regulating solid waste within the jurisdiction of the NDEP.

3. A State "Bottle Bill", or beverage container redemption value, has worked in other States as a way to enhance revenue for regulatory oversight of solid waste management and rural local government assistance.