Central Otago WasteBusters may be on the brink of insolvency and the district council will consider today whether to bail it out.
The district's only recycling operation began in 2000 and the community-run, non-profit group provides a kerbside and rural drop-off collection service.
It has 38 volunteers and employs 23 fulltime and part-time staff.
The council had budgeted $578,000 for WasteBusters this financial year.
In a report to a council committee today, the council's infrastructure services manager, Jon Kingsford, said demand for WasteBusters' services had increased since the change from weekly to fortnightly rubbish collection on July 1 and it was unclear whether the group would be able to cope with continued increases in the volume of recyclable materials.
The organisation had faced financial challenges over the past 15 months and the council had already bailed it out earlier this year, advancing money when the group was facing a deficit.
At the end of last month, the council was told the group did not have enough money to meet its financial commitments.
Advancing support payments would not provide sufficient cash flow any month when a deficit was forecast and large deficits were budgeted for in October, November and January.
''This leads to the significant and very real concern that Central Otago WasteBusters are on the verge of insolvency,'' Mr Kingsford said.
He has recommended the council continue to fund the group, meeting operational deficits to keep it solvent, and review the options for future provision of recycling services in Central Otago.
In June, WasteBusters general manager Glenys Byrne aired her concerns to the council about uncertainty for the organisation once rubbish collection changed to fortnightly, because the increase in the volume of recycled material was unknown.
She said an increase would place ''huge financial pressures'' on the organisation.
