10 cost recovery mechanism and ring fencing lgu accounts - s

HON. SENEN C. HON. SENEN C. LLORENLLOREN

Municipal CouncilorChairman, SWM - TWG

The Original Maker of The Original Maker of CalamayCalamay

JAGNA MUNICIPAL HALLJAGNA MUNICIPAL HALL

3RD Class Coastal Municipality 2008 Population – 36,528;

# of households- 6,134 2008 Income 55M (IRA 43M; LI

12M) 2008 Allocation for SWM – 1M Total Number of Brgys. – 33 Collection area – 8 barangays

(Metro Jagna Cluster) 1 Port Facility

67%

11%

20%2%

Bio-degradable Recyclable Residuals Special Waste

JAGNA HAS AN AVERAGE DAILY OF 10 TONS

OF SOLID WASTE

A. Organization of SWM-TWG & ESWMBB. Formulation of the 10-Yr SWM PlanC. Establishment of SWM Facilities & Acquisition of Equipments D. Implementation of the Enforcement PlanE. Sustainability Mechanisms 1. Social Marketing 2. Economic Enterprise

JAGNA SWM KEY IMPLEMENTATION JAGNA SWM KEY IMPLEMENTATION STAGESSTAGES

(2002 – PRESENT)(2002 – PRESENT)

A. Organization of SWM-TWG & A. Organization of SWM-TWG & ESWMBESWMB

Letter of Intent/MOA Signing LGU- EcoGov Creation of TWG / SWM Board – 2002

Orientation of the TWG & Board-2003

B. Formulation of the 10-Yr SWM PlanB. Formulation of the 10-Yr SWM Plan

Enactment of the SWM Ordinance (initial) Waste Characterization (WACS) – 2003 Consensus Building (Brgy Level) for the 10Yr Plan – SWM – 2003 Household Survey Disposal Practices Training of Trainors (Speakers Bureau)

IEC Campaign Purok level for the 7 Barangays – Orientation of Solid Waste Management Plan and Draft Plan RA 9003 (2003)

Finalization of 10Yr SWM Plan (2nd Qtr 2004) Presentation of Plan to SWMB & Approval: Adopted by MDC & SB

Enactment of SWM Ordinance (modified)

C. Establishment of SWM Facilities & C. Establishment of SWM Facilities & Acquisition of EquipmentsAcquisition of Equipments

Establishment of Central MRF (4th 2004)

Site-selection Sanitary Landfill & Inspection (Tubod Mar – March 2005)

Establishment of Central Composting Facility (2005)

Acquisition of Vermi Worms/Shredder

Assessment of Soil, Suitability of SLF by EMB, MGB 2007 – approved 2007

Orientation/Consolidation SLF area (Feb. 2008 Tubod Mar)

MOA Signing SLF (LGU–Brgy. Tubod Mar

Acquisition of Land for SLF 2007 Acquisition of Office equipments and vehicles

D. Implementation of the Enforcement PlanD. Implementation of the Enforcement Plan

Info-drive for Business establishment (SWM orientation/business permit – Dec. 2004)

Formulation of Enforcement Plan (1st Qtr 2006)

Establishment of SWM Office and Creation of SWM Action Officer & Personnel

IEC to 7 Brgys: March 2006

Training of Brgy & Mun. Enforcers (April)

Dry Run: Full SWM Process (May 1, 2006 – Aug. 2006)

Launching August 15, 2006 (Caravan, Parade, Program)

Enactment of M.O. No. 14-04-2005 on Regulation of Buy & Sell Operation of Scrap Materials

E. Sustainability MechanismsE. Sustainability Mechanisms Social Marketing Implementation(Behavior Change Tools Mechanism)

Creation of Social Marketing Core Group (April 2006)

Social Marketing Plan Formulation (June)

Launching of Social Marketing (Sept. 20, 2006) Goyo Boy Mascot

Enacted JAGNA YOUNG ECO-SAVERS CLUB Ordinance (M.O. No. 4-05-2006)

Orientation to teachers & Students: SWM & JYESC

Implementation of JYESC (Oct. 20, 2007)

Expansion of JYESC to JCES (June 27, 2008)

Economic Enterprise (2008) (Jagna SWM Code - Art. 16, Sec. 58)

Cost Recovery Ring Fencing (June 2008) SWM Cost-Recovery Plan Finalization

Bottom Lines in Waste Bottom Lines in Waste ManagementManagement

1. Primary Objective: Waste diversion2. Revenue Objective: Recover the costs of

providing a quality, consistent and dependable SWM Program.

3. Social Objective: Improve the health and sanitation conditions and preserve the environment.

4. Social Ownership: Ensure the continuity and sustainability of dependable SWM Program.

What is Cost-Recovery?What is Cost-Recovery?

Cost Recovery is the process of passing on to the waste generators or service users the full or partial cost of collecting wastes, composting, recycling, and disposing in the landfill

For example:

Total Cost P1,000,000Recovered Costs (fees, etc.) 600,000 Subsidy 400,000 Cost Recovery Rate 60%

1. GEN MGT & Admin (Inc. IEC)

1. Collection2. Composting

3. Recycling

4. Disposal

SOLID WASTE MANAGEMENT PROCESSES

EXPENSES 2009 2010 2011

Salaries and Wages P 520,000 P 520,000 P 520,000

Fuel & Lubricants 100,000 120,000 120,000

Supplies and Materials 62,000 65,000 65,000

Seminars and Training 25,000 25,000 25,000

Repairs and Maintenance 50,000 55,000 60,000

Office Supplies 4,000 5,000 5,000

Travelling Expenses – Local 5,000 10,000 15,000

Depreciation Expenses 6,500 7,000 7,500

TOTAL EXPENSES P 772,500 P 807,000 P 817,500

DETAILS 2008 2009 2010 2011INCOME (Actual )

Vermi Cast 47, 250 P 70,000 P 80,000 P 100,000

Recyclables 8,500 10,000 11,000 12,100

Permit To Transport 5,500 8,500 10,000 15,000

Biodegradable collection fee 11,000 13,500 14,850 16,335

Households Garbage Fee:

Looc 12,960 13,000 15,600 16,000

Poblacion 12,000 12,000 15,600 17,100

Tejero 10,560 11,000 20,000 22,600

Canjulao 12,000 12,000 27,600 30,100

Pagina 10,800 11,000 16,800 20,285

Can-upao 1,500 2,000 15,600 25,000

Bunga Mar 4,500 5,000 17,000 23,500

Pangdan 3,600 4,000 14,750 21,500

Garbage Fees (Business) 180,000 200,000 220,000 242,000

TOTAL INCOME P 320,170 P 372,000 P 478,800 P 561,520

2009 2010 2011

LGU SUBSIDY PERCENTAGE

52% 41% 31.4%

COST RECOVERYRATE 48% 59% 68.6%

2009 2010 2011

EXPENDITURES P 772,500 P 807,000 P 817,500

INCOME 372,000 478,800 561,520

LGU SUBSIDY (P400,500) (P328,200) (P255,980)

What is Ring-Fencing?What is Ring-Fencing?

Ring fencing means:

Keeping the resources earmarked for implementation exclusive to the program

Plowing back revenues generated through activities to the program for use in implementation.

JAGNA SWM RING FENCING STATUSJAGNA SWM RING FENCING STATUS Jagna SWM Code – Art. 18, Sec. 60, 61 Municipal Resolution No. 12-03-2008 to open special account and separate bank account for SWM (FCB Checking Account Number 19-0106-00028-2)

COMPONENTS OF SWM RING-COMPONENTS OF SWM RING-FENCED ACCOUNTFENCED ACCOUNT

Financial Guidelines on collection, utilization, recording and reporting.

Accounting has already segregated to all SWM transactions.

Treasurer’s Office has provided a separate Official Receipt booklet for SWM collections.

As part of the business license renewal, the applicant has to pass through the SWM office for assessment of corresponding fees to be included in the annual license fees.

Legal Bases For Cost-Recovery/Ring-Legal Bases For Cost-Recovery/Ring-FencingFencing

RA 9003 (ESWM Act of 2000) authorize LGUs to impose adequate fees to pay for the cost of preparing, adopting and implementing SWM plans and programs.

RA 7160, Sec. 17 (Local Government Code)

M.O. No. 20-11-2004 (Modified SWM Ord.)

M.O. No. 4-02-2009 (JAGNA SWM CODE)

Ring fencing of SWM fund allows implementors to monitor performance and do proper budgeting and planning. Funds are more wisely used. Reliable data is available to determine the succeeding years subsidy level and for validating existing tariff rates

The system helps keep the SWM team

focused on their performance targets.

Financials are stronger due to increased revenues and controlled

expenses.

Why did Jagna decide to Why did Jagna decide to implement cost-recovery and ring implement cost-recovery and ring fencing? fencing?

High cost of providing the service

LGU has limited funds

Collection is done daily without regard for operating cost

Concern for sustainability of the program

How did Jagna do cost-recoveryHow did Jagna do cost-recovery

Cost and revenue analysis was conducted in January 2008

Action planning was conducted to address low collection efficiency of from garbage fee at 47% and high subsidy level at 77%

Formulated financial management guidelines in March 2008

Opened a separate bank account exclusively for SWM in June 2008

Attended business planning workshops in May and August 2008

Reviewed fee structure (business vis-à-vis households) in the context of polluters pay principle

Enacted the SWM code Finalized the cost-recovery plan Conducted regular review of operation

Tapping opportunities for substantial and sustainable revenue growth.

Cost recovery plan targets only operating costs and does not take into consideration capital investments required down the road

Maintaining quality of service so that people will continue paying.

The political will of the leaders and the commitment of the implementors are critical to a successful program.

Creation of SWM Board & MOA Creation of SWM Board & MOA Signing with ECOGOV and DENRSigning with ECOGOV and DENR

Jagna Central MRFJagna Central MRF

Sanitary Sanitary Landfill Landfill

SiteSite

Jagna Central Jagna Central Composting Composting

FacilityFacility

Formal Launching of SWM August 15, 2006

(Caravan at 7 Barangays Collection Area)

SWM Official ReceptaclesSWM Official Receptacles

Municipal Municipal Enforcer on Enforcer on

DutyDuty

Biodegradable Biodegradable FeeFee

Billboard (16’ x 10 ft., tarpaulin)

LAWAS PANGGA-ON, BASURA ATIMANON.LAWAS PANGGA-ON, BASURA ATIMANON.

MAGAMITPA

DELIKADO

MALATADILI NA

MAGAMIT • Pakpak sa prutas ug utanon • Sagbot, dahon, abo • Sinapsap ug sinapilya sa kahoy • Tae sa mananap (baka, baboy, kabaw, kabayo, kanding ug uban pa) • Bagaso, saw dust • Bagaw sa itlog • Tahop• Hasang, tinae ug tunok sa isda

• Battery • Bombilya/flourescent • Hupas nga medicina • Chemical Containers • Guba nga appliances • Used oil

• Sanitary napkins ug diapers • Guba nga sapatos, tsinelas ug sandals • Disposables ( plastic glass, paper plate, picnic box) • Guba nga tela ug trapo • Putos nga carton (medisina,sabon) • Cellophane ug ubang humukon nga plastic • Papel ug cartoon nga dili na magamit o lata na • Styrofoam • Ceramics • Sachets

• Papel ug carton nga maayo pa • Puthaw • Lata • Hard plastics • Botelya / Buak nga botelya • Ligid sa sakyanan • Botelya sa medisina ug ubang grapa • Newspaper• Botelya sa purified water (PET)BEMOEco Gov DENR

BROUGHT TO YOU BY: IN PARTNERSHIP WITH:

JAGNA

Creation of SWM MascotCreation of SWM Mascot

Creation of Jagna Young Eco-Savers Club Creation of Jagna Young Eco-Savers Club by virtue of M.O. No. 4-05-2006by virtue of M.O. No. 4-05-2006

Formal launching on July 17,

2007

Redemption of recyclable items

every Wednesday

SWM Garbage SWM Garbage CompactorCompactor

SWM Dump SWM Dump TruckTruck

Provincial SWM AwardProvincial SWM Award

P

C

I

JAGNA’S 3 WORDS TO JAGNA’S 3 WORDS TO REMEMBERREMEMBER

– Political Will

– Commitment

– Innovativeness