GPCRDA budget reflects higher waste disposal costs

By: K. Michelle Moran | Grosse Pointe Times | Published July 21, 2020

GROSSE POINTES/HARPER WOODS — A small surplus from the 2019-20 fiscal year is being applied toward the Grosse Pointes-Clinton Refuse Disposal Authority pension contribution for the 2020-21 fiscal year.

“We netted $2,993” as of the close of the 2019-20 fiscal year on June 30, GPCRDA Board member Terry Brennan said during a May 12 meeting via Zoom.

During the meeting, the board voted unanimously in favor of a $776,600 budget for the new fiscal year, which started July 1. The budget includes a pension contribution of $32,050, slightly higher than the contributions budgeted in recent years.

“I basically used the excess that we had (to add to the pension contribution),” said CPA Lynn Gustafson, who handles the finances for the GPCRDA. “It’s kind of an unknown with the market.”

GPCRDA Board member Bill Snyder said that the final numbers for the pension contribution “are not available until July, when the actuarial numbers come in.”

Because the GPCRDA pension plan is closed — there are no employees contributing to it now, because the incinerator is no longer operating — they need to maintain assets “equal to 120% of the actuarial accrued liability,” according to an audit report.

“We don’t know until the end of the (fiscal) year if we need to contribute to (the pension) or not,” Gustafson said. “If not, (the budgeted pension contribution) is just excess.”

Gustafson said the actual pension contribution could also be higher than the budgeted amount.

“It’s an estimate based on your years of expertise,” GPCRDA Board member Donald Parthum Jr. said to Gustafson.

The overall budget is substantially higher than it has been in recent years, when it has been around $499,000, because the member communities are paying more for trash disposal under a new contract with Waste Management. The communities had been using Detroit Renewable Power, which closed in 2019.

“This is a pass-through (charge),” GPCRDA Board Chair Brett Smith said of the higher waste disposal costs. “That’s why the income and budget are higher.”

The five Grosse Pointes and Harper Woods make up the GPCRDA.