CONTRACT COMPARISON
November 20,2008
COVANTA TIP FEE
CRRA
$65/ton tip fee for Year 1 (2010).
$67.45-$75.30 estimated tip fee for Year 1 (2010). ~ Tip fee estimate for Year 1 based on Fair Market Value assumption of $23.5 million.
Tip fee changes based on CPI (Northeast Urban Less Energy) with floor (1.75) and ceiling (3.5).
Yearly tip fee determined by net cost of operations.
Every 5 years tip fee subject to reset based on market average No other municipality will be offered a contract with a lower tip fee by Covanta without extending the same to participating municipalities ("most favored nation" status).
COMMITTED TONNAGE
FACILITY OWNERSHIP
Year 2010 estimate: 18,900
Year 2010 estimate: 43,200
Committed tonnage is adjusted annually by a formula that uses rolling averages. This is to adjust for increased recycling that a town may achieve.
Committed tonnage is adjusted annually by a formula that uses rolling averages.
Private ownership by Covanta with an option for municipal purchase in year 20.
Public ownership by CRRA but no municipal ownership option.
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COVANTA
CRRA
Host benefit based on $11/ton for all accepted solid waste.
Host benefit based on property tax that facility would pay escalated at 3%/year.
Host benefit estimated at $1,600,000 for 2010.
Host benefits decline from $1.2 million over initial 5-year period to the value of property tax as escalated which is approximately $764,000 in year 5 assuming a $23.5 million Fair Market Value.
FLOW CONTROL
Contract requires no immediate action to address MSW delivery to the facility; but, Town may need to address flow control in the future if tonnage delivered to the plant shows reduction, if there is a possibility for lower cost, or if law changes require action.
Town required to pass flow control ordinance directing all MSW to facility
RESERVES
No reserves required by contract
New project reserves (estimated at $7,000,000) to be funded with current project reserves on a pro rata basis among participating towns.
HOST COMMUNITY BENEFITS
Balance of other nondedicated reserves of current project returned to towns on pro rata basis.
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