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Spending Your Tax Dollars: Shelby trash plan requires no public OK

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FIRST IN A SERIES: Shelby County’s planned trash and recycling center is the sole decision of 3 appointees who have to answer to no one.

The $3.2 million solid-waste and recycling center being developed for Shelby County is a taxpayer-funded concept of three men appointed to indefinite terms on a board that has no public oversight.

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After 43 years of near obscurity, Shelby County’s 109 Board – chaired by Deputy Judge-Executive Rusty Newton and including engineers Kerry Magan and Tom Rockaway – has emerged to the forefront of the public’s eye rather quickly this year by announcing its plan to spend $2.5 million of property-tax revenue to build a center on 25 acres for which it already had paid more than $600,000. The board also suggested that users would have to pay a per-pound fee to continue to deposit their garbage at this facility.

The 109 Board’s idea was to replace outdated drop-off locations in Waddy and Shelbyville with a state-of-the-art layout that would encourage recycling and provide easier access to more residents.

The board took those plans to the public at a series of meetings and paused with those plans as officials of Shelby County Fiscal Court and the city of Shelbyville reviewed whether they would respond to public requests and create curbside pickup.

But the board didn’t have to do any of this.

Although the 109 Board is funded by a property-tax assessment of 3.5 cents per $100 assessed value, those three men have the statutory authority to collect and spend tax dollars on any sort of solid-waste program they determine appropriate.

Anthony Hatton, director of the Division of Waste Management, within the Department for Environmental Protection in the Energy and Environment Cabinet, said the only way that 109 Boards have to answer to state government is if they receive grant money.

“Our Recycling Local Assistance Branch is the responsible body for making sure they [109 Boards] are compliant with the way they spend any grant money they may receive,” he said. “I am not aware of any entity they have to answer to as far as daily operations or management or things of that nature.”

Tim Hubbard, assistant director under Hatton, echoed that opinion.

“I am not aware of any entity that has any regulatory authority over them,” he said.

The fact is that 109 Boards – as special taxing districts – can do whatever they see fit with their revenue as long as they present a balanced budget to whatever government body that controls the majority of the county, such as fiscal courts.

It’s important to note that fiscal courts, while unable to tell 109 boards how to spend their money, are responsible for making sure the board keeps its finances in order – and that’s the extent of their supervisory power, Shelby County Judge-Executive Rob Rothenburger said.

“It is the responsibility of the fiscal court to make sure that they have a balanced budget,” he said. “When they turn their budgets in, and it’s balanced, it’s turned over to the Department of Local Government, the DLG, reviews it and if it’s balanced, and there’s no issue, they move on. They’re [DLG] not going to tell you how to spend your money; they don’t have the power to do that, nor would they do that.”

That’s because special taxing districts are their own governmental entities, Rothenburger said.

One of 13 boards

Shelby County established its 109 Board in 1970 and is one of only 13 counties in Kentucky that have established such boards, joining Bell, Butler, Christian, Grant, Hart, Jackson, Jefferson, McCreary, Meade, Pendleton, Pulaski, and Simpson.

109 boards were created in the 1970s by fiscal courts or other prominent government bodies to deal with solid-waste issues, according to the Solid Waste Management Resource Guidethat is prepared by the Resource Conservation and Local Assistance Branch, Division of Waste Management.

The guide explains that the legislation that governs 109 boards – so named by KRS.109.041 – gives them the power to deal with solid-waste issues however they see fit.

That includes, specifically, “plan, initiate, acquire, construct, maintain, and own and hold the permit for solid waste management facilities; enter into contracts or leases with private parties for the design, construction, or operation of a publically owned solid waste management facility, and adopt administrative regulations.”

New legislation

Recently passed legislation has changed the title of special districts to reflect that fact, requiring them now to be referred to as “special purpose government entities.”

House Bill 1 also requires special taxing districts to hold public hearings before enacting any tax or fee increase, which would be a requirement for Shelby County’s new solid-waste facility and its planned usage fee.

Legislators, such as state Sen. Paul Hornback (R-Shelbyville), have praised the new legislation – orchestrated by State Auditor Adam Edelen – who in announcing the plan established it as a way to gain more public transparency regarding special taxing districts and in letting taxpayers know what such boards do with their money.

But that’s based on the fact that HB 1 requires boards to publish their budgets in local newspapers and to post them online beginning in October 2014, when a state registry designed by the auditor’s office is expected to be launched. The bill does not require any person or agency – or taxpayer – to approve the budgets that are collected.

Proposed facility

Shelby County’s new facility is to be built on Windhurst Way, just west of KY 55 and north of Interstate 64. The board paid $655,000 for the 25-acre plot near Martinrea Heavy Stamping, and the build out of the center will cost about $2.5 million. The board’s annual budget is about $850,000 from taxes and recycling revenue and pays for employees at both facilities, which would be closed.

But that revenue flow may prove insufficient, and the board has generated much public debate by suggesting it would charge 3 to 5 cents per pound additionally for residents to dump non-recyclable trash.

Board members push their plan based on their assessment that the facility would be more central to residents, that one-site trash and recycling is advantageous, that the county has outgrown the Convenience Center in Waddy and that the facility is unsafe because railroad tracks must be crossed to gain entrance.

Critics have suggested a curbside plan for residents would be a better use of public money, and some didn’t like the move from Waddy or the possible new fees.

This new facility would be subject to all environmental guidelines in place now, including an annual inspection.

We have to comply with all the regs of the Kentucky Division of Solid Waste Management as well as the Division of Water,” Newton said.

“The Kentucky Division of Environmental Protection is the office that we have to answer to in relation to our old landfills because we’re constantly monitoring and inspecting those for any types of leaks or exposures from trash that was put in there in the past. They will generally inspect us once a year.”

But that’s it. Other than grants and environmental issues, the 109 Board is in complete control of its actions and expenditures.

“”We have to follow what [KRS] 109 instructs us to do, and that is to reduce the amount of trash going into the landfills,” Newton said.

“The way to do that is to promote more recycling, and the new facility will enable us to do that.”