Continue Use of WTEF beyond

Under this Option the County will begin to negotiate with Covanta immediately in order to arrive at a decision by mid 2009. The length of the agreement should be set based on terms and conditions and associated financial arrangements that best serve the County and the SWM. Outcomes of this approach allow the County to minimize new investment in infrastructure and to continue to commit increased resources to waste reduction and recycling.

The County will need to work with owners of SKRTS, MRRF and Covanta to determine other improvements needed to increase processing and recovery of materials and ensure transportation efficiencies. It also means in the immediate future that waste in excess of the WTEF capacity will be landfilled. This option allows the County to consider future alternatives for dealing with the waste that is not recycled and is being disposed of at landfills. These include possible implementation of an alternative technology or construction of a third combustion unit at the WTEF.

Option 2 - Discontinue Use of WTEF

Under this Option the County will discontinue commitment of waste to the WTEF. The County would begin to set up infrastructure needed to process and transport waste to a regional landfill. This will include new capital investments either by the County or the collection companies. As with the Option 1 it would be desirable to consider implementing additional processing to maximize recovery of materials.

A long term contract with a regional landfill would be negotiated. Starting in 2014 the County would begin transporting waste that cannot be recycled to a regional landfill. The County can continue to monitor and consider other alternative technologies and determine if such systems are cost effective in the future.

Covanta could continue operation of the WTEF by pursuing delivery of waste from other sources assuming it continues to maintain permits.

Final Draft - CHAPTER 6

6-33 April 2009

Comparison of Costs

In completing a comparison of the cost of the Options, it is important to recognize that the actual rates charged at facilities will be different. Rates are established based on allocating expenditures and allocating those expenditures based on a set of policies established by the County. In order to simplify the comparison of Options, costs are normalized over the waste handled by the entire system. In 2007 the total waste handled by the system was 248,000 tons. This includes all waste disposed at the WTEF, and Browns Island and Coffin Butte Landfills.

The other factor to consider when comparing options is that certain costs are included in all options. This includes the County’s cost to carry out waste reduction and recycling programs and services, administration and engineering, and operations of the gatehouse at all facilities. These costs are about $18 per ton and can be attributed to any of the disposal options. Costs to operate the transfer stations are $9 per ton and expenses are allocated over the entire system.

The cost to operate the WTEF is established and is known until 2014. After 2014 the terms of continued operation are expected to be similar but will not be firm until an actual contract is executed. With the bonds retired, the cost to operate the WTEF is $35 per ton. Adding the cost to transport and dispose of ash residue of $5.25 per ton, the total cost of disposing at the WTEF is $40.25 per ton. This represents the system cost to operate the WTEF but does not account for the revenue generated from sale of electricity. This revenue is about $4.2 million annually or approximately $17 per ton that is shared between the County and Covanta.

Assuming the County were to discontinue delivery of waste to the WTEF after 2014 and instead transport waste to the Coffin Butte Landfill, the cost would be between $45 and $50 per ton in today’s dollars. This does assume a new transfer station capable of receiving all or most of the County’s 300,000 tons annually would be sited and built. It may be possible to retrofit existing transfer stations and the MRRF and transport this waste stream from the different waste sheds, but more study would be necessary to verify this cost. If these facilities can be modified to provide adequate transfer capacity it may result in lower up front capital costs but may increase operations and transportation costs.

The Option to continue use of the WTEF is estimated to be $5 to $10 per ton less than use of out-of-County landfills. This does not consider the benefit of revenue from the sale of electricity. In addition, about 20% of the cost to dispose at landfills is related to the cost of diesel fuel or alternative fuels if used. This is energy not expended if waste continues to be disposed in the County.

The WTEF is subject to changes in regulations. In the past certain modifications to the facility were required to respond to such changes. Anticipating such risk the County has established a Capital Reserve Fund.

A summary of the costs and the impacts to the Marion County solid waste system for these processing and disposal options is presented in the following Table 6-5.

CHAPTER 6 - Final Draft

Table 6-5- Summary of Estimated Costs and Facilities and Transportation Impacts

SELECTED IMPACTS TO MARION COUNTY