The Baxter Day Service Center has reported a $23,000 financial loss through the first eight months of 2026—a significant improvement from the $85,000 shortfall it faced at the end of 2025, Executive Director Paul Neal told the Mountain Home City Council on September 3. Neal credited the progress to cost-cutting, new funding, and efforts to increase revenue, but challenges remain in the recycling market.
Neal noted that the financial outlook would be even brighter if the center had received funds from a state recycling grant that has been suspended for more than a year. He told the council he anticipates the grant funding will resume soon. This was the second quarterly report Neal has delivered to the council since Mountain Home allocated $40,000 to the center in its 2026 budget. The city earmarked the funds with the condition that periodic updates on production, revenue, and fundraising would follow.
While the center’s overall recycling volume has risen 3% compared to last year, Neal reported that revenue from cardboard recycling—its most significant commodity—has dropped by 10%. He attributed the decline to the center’s decision last fall to start charging businesses a monthly fee for cardboard pickup. Approximately 20% of the small commercial clients canceled the service after the fees were introduced, leaving some businesses to dispose of the material on their own.
A collapsing market for certain recycled goods is another ongoing obstacle. Neal explained that PET plastic, commonly used in water bottles and comprising roughly 80% of the center’s plastic volume, has little to no market value. As a result, the center sometimes has to store or throw away PET bales rather than pay a hauler to remove them. Glass and electronics recycling also operate at a financial loss, though the center continues to provide those services as part of its commitment to being a one-stop recycling destination for the region.
Rising operational costs are an additional strain. Insurance premiums are expected to increase from $80,000 to $96,000 next year, driven in part by recent claims related to flooding at its Rossi Road facility and the loss of a company vehicle. Staffing costs are also climbing, with Neal reporting 10 employees on staff and three additional positions, including van drivers, still open.
On the positive side, the center received $189,000 from the Ozark Mountain Solid Waste District earlier this year, which was used to purchase vans and a forklift. Neal also announced a new program, “Pathways to Independence,” set to launch soon. The classroom-based initiative will provide skills training for clients aged 18 to 25 as an alternative for those not seeking outside employment.
The recent updates mark a pronounced shift from where the nonprofit stood a year ago. In October 2025, Neal requested $70,000 in annual funding from the council after presenting five years’ worth of financial losses totaling $460,000, depleted reserves, and outstanding debts. That appeal followed the center’s controversial decision to stop providing curbside recycling services in July 2025 due to high contamination rates, staffing shortages, and mounting costs. At the time, the center's decision drew mixed reactions from council members and the community.
The Baxter Day Service Center, founded in 1971, provides vocational training and employment opportunities for approximately 40 adults with developmental disabilities. Located on a six-acre campus, the organization processes about 2.5 million pounds of recyclable materials annually. Despite progress, Neal warned that profitability in recycling remains challenging given the limited market size and persistently low prices paid for materials. Medicaid remains the center’s largest funding source, though reimbursement rates have not increased in more than a decade.
Residents may continue to drop off recyclables at the center located at 1306 Rossi Road. For a list of accepted materials, the center can be reached at (870) 425-4322.