Statewide Delivery Coordinator Meeting Highlights & Cost Considerations for 2023
In the recent Statewide Delivery Coordinator meeting, standards for delivery services were discussed along with volume and cost considerations. The 2023 budget prep included updates on current service costs, labor expenses, fuel costs, and other operational factors. Key points such as cost formula goals and strategies to balance member fees were addressed to ensure equitable participation. Check out the detailed insights and projections for the upcoming year.
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Presentation Transcript
SCLS Delivery Budget Prep Update ALL DIRECTORS MEETING 5/19/22
PLSR Update SCLS is the Statewide Delivery Coordinator Meeting to establish standards across all delivery Data: Volume and Cost of Delivery by system Standards: Expectations for service (consistency, communications, measurements Coordinating the implementation of PLSR recommendations Cooperation Piloting Plotting timelines
2023 Budget Prep Current Service Update Cost Considerations (at SCLS Delivery) Cost Formula for 2023 Fees
Current Service Update Volume Stabilized; 90-95% pre-pandemic outside of Dane County; 80-85% inside Dane County Frequencies Planning to carry forward into 2023 with minor adjustments (changes to reflect volumes on Fridays and second daily stops in Dane County) Adjustments as PLSR evolves
Cost Considerations - 2023 Labor: Current year, we are 1% plus a 1-time 1% bonus For every 1% added to delivery is about $10,000 additional in cost SCLS matches up all of the personnel; Delivery does not raise salary independently Fuel: Fuel is significantly higher than last year. For the first time, it exceeds our predicted cost It is not the most significant cost (labor is), but we are about $3,000 per month beyond last year at this time.
Cost Considerations - 2023 Everything else: Post-its Supplies: Office, garage, Uncertainty over sources Vehicle purchasing: Used market is what new used to be in terms of cost and availability New market is thin and a premium cost with no incentives Selling old vehicles returns more than we have ever seen.
Cost Formula: 2023 Goals: To balance the member fee structure in a way that reflects the cost of our delivery operation and draws fees proportionally and equitably from participants Material Handling: Sorting Volume Transportation: Cost per Stop (equalized across all members/ postalization ) Base Fee: A flat base fee to participate and absorb a portion of administrative expense Deploy State Aid funds to supplement the fees proportionally to all participants and close the gap between total fees and the total cost of member service.
Cost Formula: 2023 $529,376 The cost of delivery service to members in 2022. This includes: labor hours for the primary function of delivery (both on the road and in our facility) and fleet- related expenses (fuel and mileage based maintenance).
Cost Formula: 2023 Volume ($235,801): Cost of sorting and on-site work Locations are assessed an amount based on their share of the total SCLS bin count. Examples: Baraboo: $4,389 for 1.86% LaValle: $499 for 0.22% Sequoya Branch: $14,522 for 6.2%
Cost Formula: 2023 Stop Share ($293,575): The cost of moving the materials on the road (fuel, time, maintenance) This cost is summarized and distributed EQUALLY across all stop locations The number of the stops in a given week is the charge to each location: Examples: Belleville: 5 stops is $4,111 Rosholt: 3 stops is $2,467 Middleton: 9 stops is $7,401
Cost Formula: 2023 Stop Share: Truck Discount For all stops that have a Box Truck, we employ a 40% discount to that location Why? For moving a large amount of materials in areas where there are large locations in close proximity, we are very efficient: Dane and Sauk counties Van use is less-efficient but necessary to travel long distance This knocks off about $65,000 from the stop share total
Cost Formula: 2023 Base Fee: $1,000 assessed to each location regardless of size as a participant in the network Dedicated to help offset indirect costs related to delivery: administration
Cost Formula: 2023 2022 Fees 2023 Formula Adjusted w/ state aid Difference 2022 to 2023* -$1,399 Pct. Adams $10,656 $13,508 $9,257 -13% Columbia $50,584 $64,076 $43,910 -$6,674 -13% Green $42,090 $33,609 $23,032 -$19,058 -45% Portage $27,566 $28,132 $19,278 -$8,288 -30% Sauk $46,882 $57,664 $39,516 -$7,366 -16% Wood $24,955 $32,180 $22,052 -$2,903 -12% Dane $202,356 $305,956 $209,665 $7,309 4%
Cost Formula: 2023 More Budget work to do While we are close to theses figures, there is likely to be some movement as the budget is finalized. All attempts will be made to accurately predict our cost and keep the impacts on fees low from what is seen here This demonstrates the behavior of the cost formula and the state aid that is applied. Future years will come down to just adding in our projected costs and whether the amount of state aid dedicated to delivery changes Determined by our service priorities and member feedback
Cost Formula: 2023 Thank you to our Cost Formula team for their feedback. Kerrie and Marty helped work with this formula for a number of hours at different intervals to see how the formula changes as inputs were tested.
