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Management Audit of the Guam Solid Waste Authority

Guam Public Utilities Commission (PUC) | , International | Completed: 2020

Management Audit of the Guam Solid Waste Authority | 100_5056

The U.S. Territory of Guam is home to a population of 164,229 as well as a large U.S. military base and an active tourism industry centered around cruise ships arriving at the port. Solid waste management on Guam is provided by the Guam Solid Waste Authority (GSWA). The GSWA had historically operated a non-compliant dumpsite for the island's refuse and a collection system to serve residents. In 2008 due to long-standing environmental problems at its open dump, as well as failed management of the collection operation, the GSWA was placed in receivership by the U.S. Federal Court and an independent solid waste manager was assigned to close the old dump, open a new Class I landfill, and modernize waste collection practices. The GSWA exited the receivership in 2019, at which time it returned to the oversight framework established by the Guam Public Utilities Commission (PUC). The PUC is obligated to perform a management audit of all utilities on a recurring basis, including the newly independent GSWA. MSW Consultants was retained by the PUC to conduct the management audit, perform a rate sufficiency analysis, and a comparative analysis of manpower and staffing for the GSWA's collection operation. MSW Consultants performed initial interviews with the Authority's management team while benchmarking the organizational structure and manpower against five other similar communities in the United States. MSW Consultants compared collection system aspects such as customer base, services provided, tonnage quantities, route configurations, and equipment inventories. The Authority's third-party service contracts were reviewed by MSW Consultants staff members and the landfill operations contracts by a landfill engineer working as a sub-consultant. In addition to reviewing the management structure, MSW Consultants analyzed the historical and projected financial data for the Authority's operations in order to determine if rates were sufficient to cover expenses and meet fund balance requirements for a ten-year period. MSW Consultants reviewed and updated the rate model provided by the Authority, in the process of making it more accurate and dynamic in order to model various financial scenarios.

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