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Consultants tell Merced Council rates need modest annual bumps to avoid depleting solid-waste fund
Summary
Consultants for Merced City presented two five-year solid-waste rate scenarios — roughly 4.5% or 5.3% annually — and told council the fund will be depleted in the long run without action; staff will return with Proposition 218 notice options after further direction.
Merced City heard a detailed five-year financial review of its solid-waste operation on Jan. 20, with consultants recommending modest annual rate adjustments to keep the service solvent.
G. Schultz of R3 Consulting said the city’s current solid-waste revenues fall short of projected expenses and that “we are recommending rate adjustments somewhere between 4.5 and 5.3% corresponding to the two options that we put before you this evening.” Schultz emphasized that the study models operating- and capital-cost growth and that the fund’s reserves would be drawn down without a multi-year rate plan.
The consultants presented two options: a uniform 5.3% annual adjustment across classifications for up to five years, or a 4.5% option that staggers higher increases in later years. Staff and…
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