Fort Smith sanitation revenue down 10.8% in 2009
by March 16, 2010 6:00 am 85 views
The 2009 revenue for the Fort Smith Department of Sanitation was down 10.8% — or more than $1.535 million — compared to 2008, but the 2008 comparison is difficult for several reasons.
Most of the revenue decline came from landfill operations, with that sector down $1.06 million as a result of the combination of debris from 2008 storms and the recession, said Joseph Hopper, division manager for the DOS. Hopper said 2007 came with a mid-year rate increase that covered for a dip in tonnage. And then there was 2008, with the major wind and hail storms that damaged thousands of homes in the Fort Smith region.
“We experienced two severe weather events which increased our volumes of construction and demolition debris and ultimately our revenue. 2008 would have been much more like 2007 had we not experienced the severe storms,” Hopper said in an e-mail interview with The City Wire. “The economic downturn, which started in 2008, wasn’t recognized in our landfill revenue/tonnage until 2009 because of the 2008 weather events.”
Industrial collections dipped 11.9% in 2009, with the obvious reason being the reduction in manufacturing activity in the area. Hopper said he is optimistic about 2010.
“We haven’t really gotten any indicators from our current industrial customers with regards to 2010 but we were fortunate to obtain some new (major) accounts in the latter part of 2009,” he explained.
Also new in 2010 will be about 4,700 household trash service accounts the DOS will collect beginning July 1. The Fort Smith Board of Directors voted Nov. 3 to end a contract with Altes Sanitation. Presently, Altes is the only third-party trash service handling residential waste in Fort Smith, with the DOS handling 82%, or the other 20,820 accounts.
“Considering our customer base will increase by approximately 4,730 households in July, we expect our gross revenue to increase by about $380,000 for 2010. For 2011, we should recognize a gross revenue from the additional service area of around $816,900,” Hopper said.
Although it is a small part of the overall revenue stream, recycling revenue dipped more than 60% in 2009, a direct result of the decline of the global recyclables market. Hopper said the global economic downturn resulted in less production of goods, which decreased demand for recycled materials. This downturn has a double-whammy impact on the DOS in that it cuts revenue and forces more waste into the landfill.
“Our primary goal with recycling is not to generate revenue, even though it’s beneficial when we are able, but rather to divert waste away from the Fort Smith Landfill which results in great savings over the long term with regards to landfill airspace,” Hopper said.
The DOS plans a $2 million, 12.5-acre expansion of the landfill in 2010. Fort Smith has one of the largest landfills in Arkansas and Oklahoma. The landfill, which benefited from receiving former Fort Chaffee property, has a lifespan of more than 65 years and encompasses 1,102 acres.
