Nov. 28, 2007 The hearing examiner charged with reviewing suggested fees for waste disposal in the territory is urging the Public Services Commission (PSC) to deny the proposed environmental user fee (EUF) as it currently stands and approve, temporarily, a proposed wastewater user fee (WUF).
The PSC, which is charged with regulating the Virgin Islands Waste Management Authority (WMA) which proposed the fee collection system, meets Wednesday at 5 p.m. to decide whether or not to approve the fees.
The examiner's report criticized the WMA for failing to substantiate many of the supposed expenses and the rationale underlying its fee collection system, which calls for imposing a tax by weight on all products entering the territory, as well as on products manufactured in the Virgin Islands. The plan is intended to finance disposal of solid waste in the territory.
As for wastewater, the report described as "reasonable" the WMA's plan to more than double wastewater fees to $110.97 per residence followed by annual increases of 15 percent for 15 years, but said more study is needed, especially when it comes to impact on low income residents.
The report noted that even with the increased costs, the expenses relative to wastewater treatment may not be met, even though residents in the territory could ultimately be paying up to eight times the amount stateside residents pay for the same service.
While the report claims the EUF has two "strong points" — one being that it would be difficult for the public to avoid paying the fee, and the second being it would raise the funds the WMA contends are necessary for it to be self-sufficient — the report says those positives are "overshadowed by numerous defects which render the EUF, as proposed, untenable."
The consultant hired by the PSC to review the authority's plan said the WMA had failed to substantiate exactly how much money it needs to conduct its programs, and questioned the WMA budget, 40 percent of which goes to administrative costs. "The PSC consultant concluded that WMA did not provide sufficient information for it to determine if the revenue requirements were reasonable " the report stated.
The report acknowledged that an EUF approach to funding waste disposal, or an advance disposal fee, has never been used before, but the report does not suggest abandoning that approach entirely. Instead the report calls for postponing the implementation, pending further study.
The WMA's lack of supporting evidence was cited again and again in the examiner's report, especially with regards to the EUF. It claimed no recycling plan has been put forward, no rebate program exists to reimburse importers whose products don't wind up in the waste stream. It also claims the WMA has no plan in place to tax mailed items, and no plan exists relative to assessment of a fee on goods manufactured or produced in the Virgin Islands.
The examiner says no EUF should be implemented until Oct. 1, 2008, and only then if WMA provides the following supporting documents:
— a detailed plan to bring disposal systems and programs into compliance with federal regulators and outstanding court orders;
— a detailed plan, including a cost-benefit analysis, on managing remaining landfill capacity and future waste diversion and reduction activities including alternative disposal plans once the landfills are closed;
— an audited financial statement on funds spent by the WMA since its inception in 2004;
— a budget that reflects program costs and capital costs;
— a report comparing the costs of implementing and administering the proposed EUF;
— a report on the effectiveness and cost efficiency of its operations;
— a revised fee structure which addresses needs of low income residents and includes an exemption on taxes for imports such as food and medicine;
— a revised fee structure which addresses implementation of a recycling and rebate program;
— a report on the collection and disposal of hazardous and toxic waste; and
— a report detailing mechanisms for implementing the EUF without delaying clearance of shipments into the territory, including a plan for collecting the fee for items arriving through the mail
Wednesday's PSC meeting is being held in Barbel Plaza, at the PSC headquarters on St. Thomas, and is open to the public.
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