Okaloosa County BOCC — September 6, 2016 — ISP Report Solid Waste — reading text

NORTHWEST FLORIDA STATE COLLEGE 100 College Boulevard, E. , Niceville, FL 32578-1295 , (850) 678-5111 , www.nwfsc.edu June 24, 2016 Mr. John Hofstad County Administrator Okaloosa County Administration Building 1250 N. Eglin Parkway, Suite 102 Shalimar FL 32579 Dear Mr. Hofstad: I am pleased to present the report "Management Control Review of the Solid Waste Section of the Okaloosa County Public Works Department" prepared by the Institute of Senior Professionals at Northwest Florida State College . The investigative and writing team composed of Chairman, Dick Schoditsch, and members Don Bohler, Bob Garcia, Phil Hoge, Tom Reynolds, and Loyal Weaver have prepared a thoughtful, thorough report that was reviewed and approved at the ISP's meeting on June 21, 2016. We hope this report will assist you in your role as County Administrator and will provide discussion points for your County Commissioners .. Sincerely, Sasha L. Jarrell, Ph.D. Interim President SU:cl NWF State College Fort Walton Beach Campus · (850) 863-6500 Chautauqua Center, DeFuniak Springs · (850) 200-4100 Hurlburt Center, Hurlburt Field • (850) 200-4190 Robert L. F. Sikes Education Center, Crestview· (850) 200-4141 South Walton Center, Santa Rosa Beach , (850) 200-4160 An Equal Access/Equal Opportunity Institution Management Control Review of the Solid Waste Section of the Okaloosa County Public Works Department June 21, 2016 Institute for Senior Professionals Nort11wes l Florida Sta te College MANAGEMENT CONTROL REVIEW OF THE SOLID WASTE SECTION OF THE PUBLIC WORKS DEPARTMENT Introduction By Jetter dated February 5, 2016 to the Institute for Senior Professionals (ISP) Chair Michael Flynt, Okaloosa County Administrator John Hofstad asked ISP to review the Solid Waste Section of the Public Works Depaiiment. Through discussions with County Administrator Hofstad and Deputy County Administrator Godwin, the scope of work presented in the request letter was modified and ISP was asked to conduct a management control review of the Section. In addition to the overall review, we were asked to give emphasis to cash handling practices at the Baker Transfer Station and the currency of payments by private waste haulers. In the course of our study, we became aware that the Environmental Regulatory Manager performed various other services such as: Mosquito Control; Stormwater Permitting and Infrastructure; HazMat Function; and Compilation of Flood Zone information. However, we limited our study to the solid waste and recycling areas. Upon approval by the ISP Board at its meeting of February 16, 2016. a team consisting of: Dick Schoditsch; Don Bohler; Bob Garcia; Phil Hoge; Tom Reynolds; Loyal Weaver; and Wayne Smith was formed and began work. Over the course of the next several months, the team interviewed the following individuals associated with Okaloosa County: John Hofstad, County Administrator Kay Godwin, Deputy County Administrator Jason Autrey, Public Works Director Jim Reece, Solid Waste and Recycling Coordinator Scott Bitterman, County Engineer Gayle Edge, Program Technician II Janet Thompson, Program Technician II Scott Henson. Environmental Regulatory Manager Darrell Roper, Landfill and Recycling Foreman Scott Wolf, Weighmaster Janie Gilmore, Recycling Equipment Operator (Scale Operator @Baker Transfer Station) 1  Gary Stanford, Clerk of Courts Finance Director Sam Scallan. Clerk of Comis Inspector General The team conducted site visits to the South Okaloosa County Transfer Station, the Wright Landfill and the Baker Transfer Station and Landfill. At the South Okaloosa County Transfer Station, we held brief discussions with Waste Management employees. We also monitored, either in person or by video link, the BCC workshop on May 5, 2016, wherein criteria for the new solid waste contract were discussed. Additionally, we also reviewed the current Residential Solid Waste and Recycling Collection Franchise Agreement with Amendment, The Solid Transfer Station Operation Agreement with Amendment, Okaloosa County Ordinance I 0-11, and Waste Water Quality and Compliance Monitoring reports. We did not review the proposed Inter-Local agreement as that was in the draft stage at the time of our study. Attachments I .Initial Request from Okaloosa County 2.E-Mail from Kay Godwin dated Feb. 28, 2016 3.Current Organizational Chaii 4.Memo Request from DEP, Division of Waste Management dated Dec. 23, 2014 5.0kaloosa Response with Recycle Plan dated Sept. 3, 2015 FINDINGS AND RECOMMENDATIONS This section presents findings learned from personal interviews, site visits, and document reviews. Areas of concern, consistent with the project objectives and scope, are described. As appropriate, recommendations are presented that address the areas of concern. In general, the County's solid waste and recycling operations are operating satisfactorily and there are no reports of Waste Management, Inc. (WM) not operating within the guidelines of its contracts. However, there arc provisions in the contracts for liquidated damages if WM does not fulfill its obligations. 2 While some public entities operate their own solid waste and recycling operations, it was determined that, cmTently, the best course for the County is to continue to contract a commercial company to handle collection, transfer and disposal operations. No indications of fraud or abuse were detected, but several areas of potential risk exposure were uncovered because of the lack of management controls. This report focuses on those areas of concern. This section is organized by areas of activity. Transfer Stations Okaloosa County uses two transfer stations to serve its commercial contractors and residents. Solid waste (trash), recyclables, and bulk waste are collected and trucked to the transfer stations where it is weighed, and tipped (dumped) on the transfer station floor. From there the waste is transfen-ed to other trucks for disposal in a landfill or recycling center. Waste Management, Inc. of Florida (WM) operates the South Okaloosa transfer station and county employees operate the Baker transfer station. Twice a year the Florida Department of Agriculture (DOA) checks the accuracy of scales at the South Okaloosa transfer station and the Baker transfer station. The DOA sends the County (and WM) a report of the scale accuracy test results. Twice a year, the County has Fairbanks Scales, Inc. (FS) check the Baker scales and make any necessary adjustments. The FS calibrations are done soon after the DOA tests. The County's contract with WM requires it to test scale accuracy at least every 90 days and to keep records of those tests on file at the scale house. WM's revenue is largely determined by the tipping fees at the transfer stations. Therefore, anything that can be done to increase the tonnage crossing the scales is to its benefit and this is the area where potential abuse would have the highest pay off. Areas of concern: • While there are several accuracy checks, the scales could be adjusted in WM's favor between the twice yearly periods when the DOA and the FS tests are conducted o Adjustment of the Baker scales to favor WM would require cooperation of county employees o The County does not conduct any random, spot checks of scale accuracy at either transfer station nor does it examine the scale test logs at the South Okaloosa transfer station • Commercial truck tare weights are entered into the Waste WORKS solid waste management software system and outbound trucks (after tipping) are not weighed to verify the actual tare weight. 3  o Haulers could not tip all of their load which would increase the number of trips through the transfer station, thereby inflating the actual tonnage crossing the scales o WM could also add weight to their trucks (over the tare weight in the system) which would inflate the actual waste tom1age o Reportedly, WM verifies the tare weight of its trucks every three months, but no one from the County has seen any records of those verifications o Interviewees state that the County has never conducted any physical inspection of WM commercial trucks to check tipping practices or verify tare weights • The South Okaloosa WM Weighmaster could indicate that their truck is carrying solid waste even though it is carrying recyclables; the county scale operator could do the same at the Baker transfer station o WM gets paid the tonnage tipping fee and still can recover some money from the recyclables o No tipping fee is paid for recyclables • Non-commercial trucks that pay in cash could not go over the scales (or the scale is temporarily disabled); therefore, no record of the transaction is created in the system. The haulers could get an "off - line receipt" to take to their customers o This would require cooperation of drivers, the Weighmaster (and/or scale operator), and maybe other employees at the transfer station • All payments from haulers that do not have an account are made by cash or check. No credit cards are accepted. While there are cash verification procedures in place (matching receipts automatically printed from the system), the lack of credit card acceptance is an inconvenience for the haulers and the Weighmaster (or the scale operator) and cash handling always has a risk of abuse o The County Clerk of Courts Inspector General has implemented a procedure to conduct spot checks two times per year of all cash handling procedures throughout the County • The minimum tip fee, which is $1.64 for citizens, appears to be low o Total tipping charges are carried out to the nearest cent, which requires scale operators to have coin change on hand for haulers paying in cash • There are no cameras to record operations at the Baker scales, transfer station or landfill o Without camera coverage, there is no way to review operations which increases the opportunity for potential abuse o Since the Baker scale operator handles cash and is alone most of the time, there is a safety issue which is exacerbated by the lack of camera coverage Recommendations: • The County should conduct random spot checks of scale accuracy and WM truck tare weights o Use independent contractors, as needed to provide the necessary equipment and expertise 4  o At Baker, the calibrations done by the contract scale company, currently FS, should be scheduled away from the DOA tests and done on a more random basis • If the DOA indicates the need for adjustment, the County would need to adjust the schedule to respond • Conduct random, "drop - in" observations of transfer station