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Råd & Vink om gebyrfastsættelse på affaldsområdet
English Summary
This report Recommendations and Hints on establishing Waste Charge
Structure and Waste Charges ("Råd og Vink om fastsættelse
af gebyrer på affaldsområdet") is a review of the legal frame
for establishing municipal waste charges. The publication also considers various
subjects of importance when deciding the structure of budgets.
Background
The background for the project is a decision in the Danish Parliament
(Folketinget) from December 1996. After a debate concerning waste policy
Folketinget unanimously decided along with other elements to obligate the
Minister of Environment to ensure transparency in charges and budgets for the
individual waste activities.
On behalf of this decision the board of directors in the association of
joint municipal waste companies, Reno-Sam, discussed the matter and agreed in
the necessity of ensuring optimal transparency. Reno-Sam concluded that a legal
review and recommendations were required. On this background Reno-Sam applied
and obtained a grant from the Danish Council for Recycling and Cleaner
Technology (Rådet for genanvendelse og renere teknologi).
Legal frame
The review of the legal frame highlights and discusses the general
principles for establishing charges, covered by the following headlines:
- Warrant due to local regulations
- Budgets must ensure appliance of non-profit economy over a few years time
- A reasonable compliance with the service charged and the services
available must be applied
- Waste charges are charged to waste holder - i.e. charges covering various
waste services can only be applied to homogeneous groups of users
- Transference within the budget for later investments is accepted provided
these are well defined and related to the specific services paid for
- Graduation in charge to achieve certain – e.g. environmental - goals,
is only legal if reflecting obvious differences in actual expenses.
Discussions and considerations concerning establishing budget and charge
structure
Beside the review and discussion on the legal frame this report presents and
discusses a number of items relevant for municipalities and joint municipal
companies, when deciding structure and principles for establishing charges.
The report describes the limited possibilities for financing by taxation.
Possibilities for depreciation and transfer by using different budget principles
are also discussed. Recommendations are given as to dividing the total budget
into the different activities which it covers. Possibilities, problems and
benefits concerning the use of average charges contrary use of charges based on
actual individual costs are discussed.
Operational budget principles
Basically, budgets in municipalities and in municipal companies have a legal
obligation to follow cash flow principles. Different budget principles can be
approved by the State County (Tilsynsrådet). The report outlines some key
principles for operational budget principles to ensure that budget and account
gives a true picture. It is e.g. elements like depreciation over lifetime for
investments, observing the same principles every year, relating all cost and
income to the right period. It is also discussed how to distribute common cost
on activities.
Publication
Publication is an important tool to ensure transparency. The report
recommends that an annual publication on charges are made and combined with
additional information in the mandatory periodical waste management plans
(4-year).
The information in the short term plan could e.g. cover description of:
- How charges are determined for each activity
- What are included in depreciation and interest
- Transference
- Distribution of common costs on the individual activities.
Model budget
As inspiration the report finally presents a budget for a constructed model
of a joint municipal waste company. The budget is based on operational budget
principles and is divided into 11 separate accounts, i.e. budgets for:
- Common administration
- Interest
- Depreciation
- Collection of household waste
- Incineration
- Sum of charges from collection and treatment of household waste
- Recycling centres
- Landfill
- Composting
- Transfer station for hazardous waste
- Recycling activities
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