Case Study

Montgomery County, MD

PFM has worked with Montgomery County, Maryland both in designing and implementing a new revenue structure for its solid waste system, and in financing large capital projects on the strength of this new credit. The County's objective was to design a structure under which the County directly charges residential and commercial solid waste generators for all or a portion of the County's disposal and other system program costs. PFM worked with the County finance and legal staff to develop a new funding mechanism, which would permit the County to directly charge users for all, or a portion of the County waste disposal system. This "System Benefits Charge" was petitioned to referendum and was approved by the County electorate in November 1995.

PFM was also asked to project the costs of three major disposal options (waste-to-energy, in-County landfill disposal, and out-of-County disposal) so that the County knew how much revenue would need to be collected through the systems benefit charge. PFM constructed a detailed cash flow model that projected cash flow for all components of the County's waste disposal system including the recycling program, composting program, transfer station, resource recovery facility, landfill, out-of-County hauls and administrative costs. PFM has recently designed the systems benefits charge methodology used by the County to charge the commercial (non-residential) sector of the county. This was implemented in 1995 following a voter referendum