Questions and Concerns About the Frederick County Incinerator

These incinerator concerns have been sent to officials, politicians and candidates in Frederick County, Carroll County and the State of Maryland; the Northeast Maryland Waste Disposal Authority, and others.

Costs

Kirby Delauter doesn't think the incinerator is going to cost Frederick anything!

Sent 08/29/10:

In this recording, go to 34:30... (Discussion starts at 27:50)

Someone needs to tell Kirby to read Article XV of the service contract!

1.)The Counties will be paying over $22M PER YEAR in operating fees alone. (To start.)

2.)And then there are those pesky passthrough costs of several MILLION DOLLARS per year.

3.) And don't forget about Uncontrollable Circumstances, and Major Maintenance and retrofits. (A blank check to Wheelabrator.)

4.) And in case anyone forgets, these costs on in addition to the estimated bond debt of $33 MILLION DOLLARS PER YEAR FOR 30 YEARS.

5.) And then the Counties have to pay any "administrative fees" the NMWDA bills.

Please don't tell me he is calling himself a fiscal conservative!

BTW, and in the signed contract the NMWDA has given itself MORE MONEY than originally planned. For brokering the deal they will be getting $517,800 PER YEAR from Wheelabrator and that escalates at 3% per year just like the operating fees!

Incinerator Finances

Sent 07/08/10 by Carroll County resident to Frederick County Board of County Commissioners:

I understand that you are considering hiring a consultant to evaluate the finances of the incinerator. If you do hire somebody, please ask them to do a “what if” analysis of your cost per ton if Carroll County terminates the partnership with you. The correct answer is the $45.11 which is the planned with Carroll involved will go to $104.02 per ton without Carroll. This is in addition to the $76 tip fee you are currently charging for a total of $180.02 per ton you will need to recover in tip fees in 2015.

You should also ask your consultant to read the financing part of the contract and explain to you why the Authority can refund to the contractor any unspent portion of the $73 million from Wheelabrator but you, the counties, will have to pay operating charge # 2 (repayment of the non-loan with the 3% non-interest) for 20 years.

The total planned repayment is $111.8 million (I added all 20 payments as shown on line 149 of the spreadsheets) REGARDLESS of the amount spent. This means that if they spend $73 million or $50 million or $25 million or nothing at all, you will pay the Authority $111.8 million. I also have an email from Robin Davidov that says the payments of the $73 million are fixed. Let me know if you would like me to forward it to you and I will.

Lastly, you may want to pick up a copy of the Carroll County Times Sunday [July 18] – they are running a front page story on the incinerator and the positions of the candidates for Carroll County Commissioner. I think you will find very limited support for the incinerator. www.carrollcountytimes.com

For what its worth, those of you who voted to proceed on the incinerator contract have been misled by the NMWDA with rosy best case assumptions, deceptive contract language, and briefings that focused on easy financing and electricity generation. They sold you on the idea of generating electricity and solving your MSW problem at the same time. They did not divulge the enormous increase in tip fees. Instead they came up with the partnership idea with Carroll County to create an artificially lower per ton cost ($45.11) for Frederick County so you would approve the project.

Now that we understand the finances over here in Carroll County, we are not going to subsidize your incinerator for the next 30 years.

Sent 07/09/10 by Frederick County resident:

The request to hire an objective outsider to do this evaluation was requested two years ago by, among others, [Frederick County residents' names removed], and a crew of supporters. Only after the BOCC has been squeezed hard enough to make them squeal, is this being considered.

A lot of taxpayer's money could have been used in more productive ways, than paying MILLIONS out to Wheelabrator, over the past year or so ( for what other than banking our money....)

So, kudos to any of us who have whined, bitched and complained, trying to get the BOCC to justify their decisions to date.

Maybe it will all start to make real sense.

Who will be the objective third party?

Response from Frederick County Commissioners President Jan Gardner, sent 07/10/10:

To clarify —

The outside consultant being hired by the county is in response to questions about the assumptions in the financial analysis for WTE such as the variation in the heating values, the electricity generated and the sales revenue from the electricity. This is an analysis, by an independent third party not affiliated with the Authority, who will review the reasonableness of the financial assumptions and potentially run some additional sensitivity analysis to respond to specific questions about the assumptions in the financials. The previous request from [Frederick County resident name removed] et al, was to hire a consultant to evaluate "other alternatives" to WTE and was not a focus on the assumptions in the financial review. What is moving forward is an independent review of the financial assumptions.

The outside consultant being used is Municipal and Financial Services Group.

As shared in previous e-mails, the county is not paying out any money to Wheelabrator for the design, engineering or permitting for the WTE. The costs to design and permit the project are Wheelabrator's costs. These costs are not being invoiced to the county and are not being paid by the county.

To oversimplify the financials — The County is not spending money up front for the design, permitting or construction of the WTE facility. The Authority will issue bonds to pay for the design, permitting and the construction of the facility as well as set up a reserve account. The bonds will be paid for entirely or almost entirely depending upon the assumptions by the revenue from the sale of electricity generated by the facility. The county (or counties) will have to pay for the operating costs of the WTE facility just as we have to pay for the operating costs of our existing landfill, transfer station and shipping our waste to out of state landfills. The operating costs are projected to be less than our current operating cost to ship our waste to out of state landfills. The cost per ton is approximately $10 less per ton than our current cost of disposal. Again, this is oversimplified and there are variations of the financials based on the assumptions used. We are independently reviewing these financial assumptions noting that they have been previously reviewed by county finance staff and the county's outside financial consultant (different than the independent consultant referenced above). There are questions about the financial assumptions and this is an effort to have someone independent review and answer these questions.

As always, thank you for your interest in this project.

Regards,

Jan Gardner

Follow-up sent 07/11/10:

[Jan said:] "As shared in previous e-mails, the county is not paying out any money to Wheelabrator for the design, engineering or permitting for the WTE. The costs to design and permit the project are Wheelabrator's costs. These costs are not being invoiced to the county and are not being paid by the county."

On pg 50 of the contract for the NMWDA's Regional Trash Incinerator:

SECTION 4.5. AUTHORITY TERMINATION OPTION DURING THE DEVELOPMENT PERIOD.
(A) Convenience Termination Option Prior to Construction Commencement Date. The Authority shall have the right any time prior to the Construction Commencement Date, exercisable in its sole discretion for any reason upon seven days' written notice to the Company, to terminate this Service Contract. Upon any such termination, the Authority shall reimburse the Company for 100% of its Cost-Substantiated costs incurred directly to third parties from the Contract Date to the Termination Date hereunder, which are directly related to the performance of the Company's obligations, and which are necessary to be performed prior to the Construction Commencement Date, and, except as set forth in subsection 5.3(E), subject to a maximum amount of Three Million Dollars ($3,000,000.00).

In the MOU between Frederick and Carroll Counties ...

Should the both Counties elect not to go forward with the Project prior to financing, the [Authority] will stop work on the Project, and the Counties will reimburse the [Authority] for actual design, engineering and permitting work performed by the [Authority] but each County’s obligation will not exceed $1.5 million. Should Frederick County elect not to go forward with the Project, before Carroll County elects not to go forward with the Project, Frederick Country will be responsible for reimbursing the project costs. If Carroll County elects not to go forward, and Frederick County cannot find a substitute equity partner, Carroll County shall pay the project costs.

Reply by Jan Gardner 07/11/10:

My point remains the same. I have copied and pasted a response sent to you several months ago (March 2010) on this subject. Many of the questions being asked are being asked multiple times. The answer remains the same.

I am writing to clarify some mis-understandings. It is apparent that you and others do not understand the requirements in the agreement between Frederick County and the NMWDA. First, Section 4.2 of the contract between the NMWDA and the County is related to billing statements for the operation of the facility after it is constructed and processing waste and generating electricity. It has nothing to do with costs that Wheelabrator incurs in the design and permitting of the project, which contrary to what you have asserted, have not been invoiced to the County or the NMWDA.

The $739,549 is the amount of money Wheelabrator has spent so far on third party consultants for the design and permitting of the WTE facility. There is no profit for Wheelabrator in this figure. It is not a fee charged to the NMWDA or Frederick County, it is Wheelabrator's expense; therefore it has never been invoiced to the County or the NMWDA. Frederick County is not being invoiced and is not paying these expenses. These are Wheelabrator's costs to develop this project.

Based on the provisions in our agreements with the NMWDA and the Memorandum of Understanding between each (Frederick & Carroll) County and the NMWDA, the Counties are required to reimburse Wheelabrator, through the NMWDA, for its project development costs that are incurred after the service agreement was executed, up to $3 million, if the Counties cancel the project.

This is a design-build-operate project, which the NMWDA entered into an agreement with Wheelabrator to complete. The cost to design and permit the project will be substantially greater than the $3 million cap, which the Counties would be responsible for if they decide to cancel the project.

According to our DUSWM, the amount of money that Wheelabrator has expended in the first 3 months of this year for the design of this facility is not unusual. In fact, it is less than the $845,639 the County expended for the design of the Ballenger-McKinney ENR WWTP project for the same time period two years ago and this was a large, but somewhat smaller project. What is the basis for your suggestion that Wheelabrator's costs to date are higher than they should be?

The BoCC approved the Energy Recovery Agreement with the NMWDA as did Carroll County and the NMWDA executed its agreement with Wheelabrator. The execution of the agreements require the facility development to proceed. This is exactly what is happening and the parties to the agreements are doing what they are required to do under these agreements.

I realize that you and others disagree with the decision of both Counties to move forward with the WTE project. I fully respect your difference of opinion. I again encourage everyone to cease the assusations and negative comments toward individual people and to work hard to end the inaccurate representation of information including about the contractural agreements. I urge thoughtful, respectful and factual debate.

Regards,

Jan Gardner [with Kirby Delauter, Frederick County commissioner candidate, in agreement]

Also sent to Jan Gardner, 07/11/10:

Jan,

Unless a separate agreement with Wheelabrator states in writing that they're offering this $50,000 study to Frederick County pro bono, I think it's very misleading (though technically accurate) to state that "These costs are not being invoiced to the county and are not being paid by the county."

Unless they've signed another contract with us to do this work for free, we're simply putting in on our "credit card" with them, right? That card (as all cards) will need to be paid back over time either with bonds for the WTE project (if a new board continues down this road) OR it will need to be paid back with another source of County funds.

But, the county taxpayers WILL be paying this cost.

I agree with [name removed]'s wise statement: "What would make the most political and financial sense at this point would be to call a moratorium on any more spending on the project until the new boards of commissioners in both counties are elected. Otherwise, the $50,000 on an "independent" study is just more good money after bad."

Reply by Jan Gardner:

In no way can the financing for the expenditures to design, permit, or construct the WTE be considered analogous to a "credit card" or even a "mortgage". The WTE facility will be financed by revenue bonds issued by the Authority. These bonds will not be leveraged against the taxing authority of the county, will not impact the debt affordability of the county, and will not be paid or obligated to be paid for by general taxation.

It appears there continues to be little understanding of the financing arrangements (based on a comparison to using a credit card) and the fact that the electricity revenue from this WTE facility will pay most or all of the revenue bonds (ie the revenue to pay the bonds).

This further points to the actual value of doing the financial analysis of the assumptions because it can also include a discussion of the use of revenue bonds and how they work and maybe improve the general understanding of the financing mechanism, the financial risk to taxpayers, etc.....

Incinerator Finances — the cap really isn't $3M [continued from above]

Sent 07/12/10:

Jan & Kirby — The terms of the contract are the ruling authority. What you call "free" must be reimbursed to Wheelabrator if the service contract is cancelled. (Again, please reference the service contract and the MOU between Frederick and Carroll Counties as provided below.)

No one is questioning if the costs are "unusual". For two reasons it should be evaluated if it is good use of taxpayers money (hundreds of thousands of dollars) to move forward with the design phase at this time:

The location of the trash incinerator at the McKinney site is not established by the courts and by MDE. (And much of the money spent appears to be site specific.)
Elections are less than 4 mos. away. It would be fiscally prudent to halt the spending until the new commissioners in Frederick and Carroll Counties decide the direction they want to take.

Would you please provide an update to the March 12, 2010 spreadsheet as I have attached here? Thank you.

Also, did you happen to see that pursuant to Section 5.3(E) it really isn't a cap of $3 Million?

(E) Limitation on Company Permitting Expenses. In the event that [Wheelabrator ] incurs third party costs to obtain Governmental Approvals necessary to commence construction of the Facility in the amount of Three Million Dollars $3,000,000.00, [Wheelabrator] shall give written notice of such event to the Authority and shall provide an estimate of the additional amount of third party costs which it reasonably believes will be necessary to obtain such Governmental Approvals. If the additional amount estimated by [Wheelabrator] exceeds Two Hundred Thousand Dollars $200,000.00, the Authority shall have the right to request an accounting of the third party expenses that total the Three Million Two Hundred Thousand Dollars $3,200,000.00. [Wheelabrator] shall not be required to expend above Three Million Two Hundred Thousand Dollars $3,200,000.00 in third party costs to obtain all necessary Governmental Approvals unless, (1) the Authority agrees in writing to increase the Three Million Dollar $3,000,000.00 limitation set forth in subsections 4.4(B) and 4.5(A) (e.g.,[Wheelabrator] will be required to spend up to Three Million Four Hundred Thousand Dollars $3,400,000.00 in third party costs if the Authority increases the Three Million Dollar $3,000,000.00 limitation set forth in subsection 4.4(B) and subsection 4.5(A) to Three Million Two Hundred Thousand Dollars $3,200,000.00), and (2) the parties agree to an appropriate adjustment to the Fixed Design-Build Price and the Construction Schedule to reflect the additional work to be undertaken by [Wheelabrator]. It shall not be a breach of this Service Contract and the Design-Build Price shall continue to escalate if [Wheelabrator] fails to diligently undertake necessary permitting work if it has expended Two Hundred Thousand Dollars $200,000.00 or more of third party costs above the Three Million Dollars $3,000,000.00 (or the amount modified by the parties) limitation, nor shall it be a breach of this Service Contract if the Authority declines to increase such limitation.

Response from Jan Gardner, 07/12/10:

Since you have read the contract, I have to assume you recognize that what you are asking for is a breach of contract!

Sent 07/12/10 to Jan Gardner:

On 5/7/08 Ms. [Robin] Davidov made the following statement, "Under no circumstances is this a one sided agreement, the County holds most of the cards." But Jan, are you saying now, that is not true?

Will you please forward the section of the contract to which you reference?

How about an update of expenses, please?

Reply from Jan Gardner, 07/12/10:

You have proposed a breach of contract. Responsible parties do not intentionally breach contracts.

Sent to Jan Gardner 07/12/10:

Jan - Are you saying Frederick and Carroll Counties don't "hold most of the cards" as was suggested?

Again, please provide information from the contract wherein it states this would be a breach of contract and what the resulting penalties would be.

Are you saying that you agreed to a contract which allows Wheelabrator to spend hundreds of thousands of dollars prior to the assurance of the site approval? If this is the case, then this is another reason this is a contract which is not in the best interests of the citizens of Frederick and Carroll Counties.

This contract should be cancelled if you have no control over the timing and the amount of expenditures. Please consider your fiduciary responsibilities as well as the perceived contractual obligations.

Reply from Jan Gardner:

The WTE project is moving forward. Both counties have voted to advance the WTE project and have signed contracts (collective) that advance the project and require Wheelabrator to move forward with the permitting, design and engineering. The site has been approved and a site lease has been approved. The project can be cancelled with a penalty of up to $3.0 million. The project is advancing as outlined and required in the contracts.

Incinerator Finances — what breach of contract? [continued from above]

Sent 07/27/10 to Jan Gardner:

The BoCC has approved the McKinney site, but there are many more steps before that location should be considered a "done deal".

The ruling of consistency of the Solid Waste Management Plan ("SWMP") under the old Comp Plan has not yet been heard by the Circuit Court. The issue of consistency of the SWMP under the new Comp Plan has not yet been heard by the Frederick County Planning Commission ("FcPc"). And since there are inconsistencies between the 2 documents, even if the FcPc votes for a certificate of consistency that will need to go thru a judicial review. This alone will take a few months.

THEN if the court hands down a ruling of consistency between those 2 documents the SWMP needs to go to public hearing. Then it has to go to the Md. Dept of Environment for approval which will include more public hearings.

There are citizens in this county who already have reasons why the SMWP should not be approved by the MDE. And I understand that recently some county SWMPs in Md. have not been approved.

Therefore, the BoCC approving the lease also seems to be premature.

Again, I ask for you to please provide from the contract wherein it states the breach and the penalties which you reference.

Also, we would appreciate an update of the amount spent to date by Wheelabrator. (Please see attached.)

PS - There is not a penalty to cancel the contract. And please note that the amount of reimbursement can be greater than the $3M. Perhaps instructions should be given to the NMWDA not to increase the reimbursement cap?

Sent 07/27/10 to Jan Gardner:

Jan — I reviewed Article XVI (Breach, Default, Remedies and Termination) in the Service Contract). (Begins on pg. 169.)

I didn't see what you are calling a "breach of contract" if Wheelabrator was told to stop spending money before the site is approved by the courts and indirectly, by the MDE. Where is the "requirement" to let them spend hundreds of thousands of taxpayer dollars?

It seems reasonable for you to STOP the spending until after the election, especially since the site issues will not be resolved prior.

Can we all have an update on the amount of money Wheelabrator has spent to date, please? (Please see attached.)

Also, why is the executed copy of the service agreement dated 1-21-10 different than the redline document (labeled Revised Final Draft of June 30, 2009) on the County website?

Sent 08/19/10 to Jan Gardner:

Jan,

Since Mr. Mathias was able to prepare a legal opinion about Mr. Locke's conflict of interest, has the Frederick County legal team prepared a written opinion about what you claim is a breach of contract if Wheelabrator is directed to stop spending money until the new boards are put into place?

PS: What's the update please of the amount of money Wheelabrator has spent to date? (Please see attached.)

More from Marion County, Oregon

Sent 07/05/10:

The following is part* of comments submitted as testimony for a 1/20/10 public hearing held by the Marion County Board of Commissioners to consider adoption of the 2009 Marion County Solid Waste Management Plan from Joseph Miller Ph.D Member, Board of Directors Oregon Chapter, Physicians for Social Responsibility (812 SW Washington Street, Suite 1050 Portland, Oregon 97205) and Associate Professor of Psychology Emeritus Saint Mary's College Notre Dame, Indiana 46556:

CONTINUED RELIANCE ON INCINERATION IS AN ECONOMIC THREAT

Incinerators pose major economic threats to communities. Early this month the Mayor of Harrisburg, Pennsylvania indicated that the city could run out of money in three months, largely because of payments that are due on $288 million in debt the city has racked up across time on its WTEF incinerator and various retrofitters and incinerator retrofits [5]. While trade industry proponents assert that the current Harrisburg incinerator -- retrofitted and operated by Covanta -- is "among the world's most innovative" and "state of the art," one proponent notes that "bottom line [the incinerator] is not making enough revenue to cover operations and debt." [6]

Harrisburg's financial status and the financial status of any other city or county that owns a WTEF incinerator will take additional hits in coming years as federal and state regulators tighten regulations on large industrial combustion facilities to reduce emissions that contribute to global warming, smog, and health impairment. Peter Montague made exactly this point in 2006 in his chronology of the Harrisburg incinerator when he noted that "if regulations on ultrafine particles, or mercury, or other emissions from the incinerator are tightened at any time during the next 30 years -- as seems inevitable -- additional retrofits and additional debt will become necessary" [7].

Stricter federal regulations are exactly what is playing out as the EPA announced in September, 2009 proposals to reduce greenhouse gas emissions from large, stationary industrial facilities [8,9]; proposals in January, 2010 to strengthen emission standards for pollutants that contribute to smog [10,11]; and preliminary remediation goals for dioxin in soil in January, 2010 [12,13]. The EPA also announced earlier this month that it is "working to complete a dioxin risk assessment that has been under review for years. The goal is to have the assessment finished by the end of 2010. When it’s finished, the EPA will use it as its scientific foundation for future decision-making about dioxins in the environment" [12].

The EPA dioxin risk assessment currently in progress is partially due to a call by more than 100 organizations to President Obama in January of 2009 to mandate the EPA to evaluate previously blocked federal regulations for dioxins [14]. Such regulations can be expected to further increase the pollution control and operational costs of, and cost projections for, incinerators and ash monofills, and impact the feasibility and cost projections for proposals for the "beneficial use" of incinerator ash. If Continuous Emissions Monitors (CEMs) for dioxins [15] were mandated in the United States as they are in some parts of Europe, WTEF incinerators would be even more costly to operate, but they would also emit fewer dioxins.

Contracts and the need to pay operational expenses and retire debt require that incinerators receive at least a stable and minimum amount of waste. Changes in our economy and society, however, increasingly threaten the ability of communities to meet their contractual obligations to supply a mimimum amount of waste to feed incinerators. Under such conditions, communities have to either pay higher tipping fees, import waste from greater distances, and/or pay financial penalties. Interrelated factors that jeopardize the ability of communities to meet their contractual obligations to feed incinerators include:

decreases in the magnitude of the waste stream due to changes in the economy, employment and consumption
decreases in population resettlement due to the economy
increased commitments to conserving resources, energy, and water by residents, businesses and consumers
increased concerns about the health and environmental effects of pollutants and global warming gases
decreases in the production of goods and the size and weight of packaging
increases in extended producer responsibility for packaging

Re the above, The Washington Post reported last April that in a number of communities across the nation, disposal is down and reuse and repair are up [16]. To cite just two additional examples, San Bernardino County, CA reported a 19 percent decline in the total waste tonnage between 2005 and 2008 [17], and "towns served by the Connecticut Resources Recovery Authority’s Mid-Connecticut trash-to-energy facility in Hartford will see their tipping fees ... increase to $69 per ton starting July 1 because the volume of garbage the plant takes in is down [by 8%] compared to last year" [18].

Also re the above, OPB recently reported that because of the recession, diminished work opportunities, and other factors fewer people moved into Oregon in 2009 than in recent years [19].

It should be noted that the recommendations in Chapter 6 of the Solid Waste Management Plan are predicated upon more and more people moving into Marion County, and projected yearly increases in the amount of waste each person discards. Both assumptions look increasingly questionable.

THE HEALTH IMPAIRING EFFECTS OF INCINERATORS AND INCINERATOR ASH

Both the national and Oregon Physicians for Social Responsibility (PSR) are signatories along with hundreds of national, state/regional, and local organizations to the "No Incentives for Incinerators Sign-on Statement" [20]. The statement asserts, in part, that: "Incinerators are a toxic technology. Even the most technologically advanced incinerators release hundreds of distinct hazardous byproducts including dioxins, heavy metals, and halogenated organic compounds in the form of toxic air emissions, particulates and ash."

An extensive and growing literature exists on the health impairing effects of the pollutants emitted from municipal waste incinerator stacks and present in incinerator ash. Contributing to this literature have been organizations such as the British Society for Ecological Medicine [21]; Prevent Cancer Now [22,23]; the Global Alliance for Incinerator Alternatives [24]; the Irish Doctors Environmental Association [25]; and a coalition comprised of the Pembina Institute in collaboration with the David Suzuki Foundation, Sierra Legal, Toronto Environmental Alliance, Canadian Environmental Law Association and Great Lakes United [26].

WAYS IN WHICH REGULATIONS (AND CLAIMS) CAN BE INADEQUATE, INCOMPLETE, MISLEADING

Representatives of incinerator corporations assert that the emissions from their facilities meet federal and state regulations, and thus imply that the emissions are safe, and do not impair health or the environment. What they do not say is that there are all sorts of ways in which these regulations are known to be inadequate, incomplete and misleading. For example [27-29]:

while some pollutants are monitored, other pollutants are completely unmonitored
monitoring may be continuous, but it may also be only on a six-hour basis once every year. Extrapolations made from such infrequent samples can dramatically underestimate day-to-day emissions.
interactions and synergistic effects among chemicals are unexplored, even though research indicates such effects can be major
timing of exposure is sometimes very important, and chemicals may have different effects at different points in development
dosage effects may not be linear, and low doses can sometimes have greater effects than high doses

Re pollutants that are unmeasured, one of the most health impairing and deadly forms of particulate air pollution -- ultrafines -- are neither regulated nor measured under current regulations, and are released in vast quantities by incinerators. Such particles are incredibly small (between 1 nanometer or billionth of a meter and 100 nanometers, i.e., 1/100,000th to 1/1000th the width of a human hair) and have a very large surface area relative to their volume. Airborn toxins attach to this surface. Such ultrafines then get lodged in our lungs, or enter our blood stream creating various types of respiratory, circulatory and other health problems. [30]

More and more such ultrafine particles are being emitted from incinerators, because more and more products containing nanotechnologically engineered ultrafine sized materials are entering the waste stream. There are currently more than 800 such products [31]. As these products are discarded and incinerated, there is every reason to believe that the increased levels of ultrafine particulates that are emitted, and the properties of these ultrafines, will create increased levels of health impairment.

Engineered nanomaterials have unique properties. The organization Food & Water Watch, for instance, notes in "Sweating the Small Stuff" that "nanoscale materials are very different than their larger counterparts, with distinct electronic, magnetic, chemical and mechanical properties," and that "nanoparticles have the potential to bypass the blood-brain barrier" ... "the potential to pass the placental barrier" .... [and that] "once in the bloodstream, nanomaterials can circulate throughout the body and be taken up by organs and tissues." [32]

"Sweating.... " also notes that "the European Commission Scientific Committee on Emerging and Newly Identified Health Risks reported [3/10/06] that 'experts are of the unanimous opinion that the adverse effects of nanoparticles cannot be predicted (or derived) from the known toxicity of material of macroscopic size, which obeys the laws of classical physics.' " [32]

Because of their nano size and unique properties, and because they are unregulated, many groups have called for urgent precautionary research, regulation and oversight of engineered nanomaterials throughout their cycle of production, use, and disposal. These groups include the Environmental Working Group, the Royal Commission on Environmental Pollution (UK), the Silicon Valley Toxics Coalition, the Project on Emerging Nanotechnologies, the ETC Group, Friends of the Earth Europe, Food & Water Watch, the Soil Association (UK), the Science & Environmental Health Network, and many others [33], as well as former EPA official J. Clarence Davies [34], and insurance companies [35,36].

References:

[5] Harrisburg Mayor Linda Thompson inherits a city that's running out of money, according to a consulting firm - The Patriot-News 1/5/10

[6] Trade publication ranks Harrisburg incinerator among the world's most innovative - The Patriot-News 12/8/09

[7] Money to Burn - Peter Montague - Rachel's Democracy & Health News #884 12/7/06

[8] As Hill Debate on Climate Flounders, EPA Plows Ahead on Emission Rules - New York Times 9/10/09

[9] EPA New Source Review: Fact Sheet 9/30/09

[10] U.S. wants to toughen smog standards, putting clamp on Oregon cities - Scott Learn - The Oregonian 1/7/10

[11] EPA Strengthens Smog Standard/Proposed standards, strictest to date, will protect the health of all Americans, especially children 1/7/10

[12] Updated story: EPA seeks input on interim dioxin cleanup goals - Midland Daily News (MI) 1/1/10

[13] Development of Draft Recommended Interim Preliminary Remediation Goals for Dioxin in Soil - Superfund - US EPA

[14] Over 100 Organizations Call on Obama to Take Action on Dioxins - Center for Health, Environment and Justice 1/16/09

[15] Continuous Emissions Monitors (CEMs)

[16] A Trashed Economy Foretold: Intake at Landfills Has Been Falling - Washington Post 3/14/09

[17] There's even less trash in this economy - The Press-Enterprise (Riverside County, CA) 2/9/09

[18] Recession has brought decrease in trash, some hikes in fees 5/24/09

[19] Company's Data Shows Fewer People Moving To Oregon - OPB News 1/5/10

[20] No Incentives for Incinerators Sign-on Statement - Global Alliance for Incinerator Alternatives (GAIA) 2007

[21] The Health Effects of Waste Incinerators: 4th Report of the British Society for Ecological Medicine, Second Edition 6/08

[22] Incineration and Links to Cancer - Prevent Cancer Now 1/09

[23] Health Effects of Incineration - Prevent Cancer Now 1/09

[24] Incinerators Trash Community Health - Global Alliance for Incinerator Alternatives (GAIA) 6/08

[25] Irish Doctors Environmental Association: Incinerators and their Health Effects 6/15/06

[26] Incineration of Municipal Solid Waste: An Update on Pollution - Pembina Institute in collaboration with the David Suzuki Foundation, Sierra Legal, Toronto Environmental Alliance, Canadian Environmental Law Association and Great Lakes United 5/07

[27] Can Chemicals Be Regulated? - Peter Montague - Rachel's Democracy & Health News #993 1/8/09

[28] Section on "Synergistic Effects" in "The Health Effects of Waste Incinerators: 4th Report of the British Society for Ecological Medicine, Second Edition" 6/08

[29] Incinerators Trash Community Health - Global Alliance for Incinerator Alternatives (GAIA) 6/08

[30] The Deadliest Air Pollution Isn't Being Regulated or Even Measured - Peter Montague - Rachel's Democracy & Health News #915 7/12/07

[31] Nanotechnology-Related Environment, Health, and Safety Research: Examining the National Strategy - Environmental Health Perspectives, Volume 117, Number 4, April 2009

[32] Sweating the Small Stuff: Nanotechnology Needs Research and Regulation - Food & Water Watch 1/07

[33] Precautionary Concerns about the Potential Adverse Effects of Incinerating Engineered Nanoscale Materials in the Waste Stream (Section 9) - Joseph Miller 1/09

[34] Former EPA Official Calls For New Environmental & Consumer Protection Agency: Technological Advances Require New Oversight - Project on Emerging Nanotechnologies 4/28/09

[35] Nanotechnology: The Smallest Big Risk - Joshua Hackett - Endurance Reinsurance Corporation of America Fall/09

[36] Insurers scrutinize nanotechnology - Environmental Science & Technology 9/24/08

*Edited in part to contain information of general interest. (Emphasis to this excerpt was added by me.) I will forward the complete testimony to anyone interested.

Money "sloshing around" — the winners and losers

Sent 06/25/10:

In attending the WasteNot Carroll County meeting this week, I had a chance to see a poster created by one of its citizens...

WINNERS

CONSTRUCTION COMPANIES - ($400 MILLION)
COUNTY GOV'T – (TRASH REDUCED TO 30% OF WEIGHT AND MAY BE ABLE TO BUY ELECTRICITY CHEAPER) & (IT'S A SILVER BULLET SOLUTION - it seems easy!)
BOND HOLDERS – ($37.2 MILLION PER YEAR)
UNDERWRITERS, LAWYERS, ETC. – ($13.6 MILLION ONE TIME FEE)
FREDERICK COUNTY – (CARROLL COUNTY SUBSIDIZES PART OF THEIR PLANT NET OPERATING COST)
WHEELABRATOR – ($30 MILLION PLUS 3% INCREASE FOR 30 YEARS)
NORTHEAST MARYLAND WASTE DISPOSAL AUTHORITY – (OWNS THE PLANT AND COLLECTS $552,000 PER YEAR)
ELECTRIC COMPANIES – (BUY 377,00 MEGAWATTS OF ELECTRICITY AT WHOLSALE AND SELL AT RETAIL)
TRUCKING COMPANIES – (CONTRACTS TO HAUL TRASH AND ASH)

LOSERS — WE ARE — THE CITIZENS!

WHY?

WE GUARANTEE BONDS AND PAYMENTS TO PLANT CONTRACTOR
WE PAY FOR ALL REVENUE SHORTFALLS AND COST INCREASES
WE ARE THE UNLIMITED FUNDING SOURCE OF LAST RESORT
WE BEAR ALL THE FINANCIAL RISK FOR THE WTE PLANT

*Please see the email below to Mr. Mark Lyons, Wheelabrator's Project Manager for the NMWDA's Regional Incinerator for Frederick County. No, he did not answer any of the questions asked.

Snt 03/06/09:

Mr. Lyons,

Some months ago I sent this clip to numerous people, and a couple people were shocked that I was implying this could possibly happen in Frederick! (Gasp, how could I think about talking about the money which will be dangling in front of people's noses!)

On page 2,

So why would anyone in their right mind want to build an incinerator? The answer is simple: money. Lots of money.

An incinerator costs anywhere from $100 million to $500 million to build. For argument's sake, let's say an incinerator costs $200 million. That money comes from the public treasury. Local governments do not often see such large bundles of money flowing their through budgets -- so an incinerator offers a unique opportunity for local politicians and their friends to take their cut, and it's perfectly legal. Bankers, accountants, lawyers, engineers, consultants, realtors and political "fixers" can all scoop off their small percentage. Even one tenth of one percent of $200 million is $200,000 dollars. So an incinerator project causes money to slosh around in the local economy in ways that no other public works project is ever likely to do. At election time, some of that money may kick back as campaign contributions to the officials who made the decision to incinerate local waste. All perfectly legal. But not good for democracy, human health, the natural environment, or the future. [emphasis added]

Low and behold, I have information there was a quiet breakfast meeting at Dutch's Daughter's restaurant with Wheelabrator and Whiting-Turner Contracting. (Were you in attendance Mr. Lyons?) This was prior to ANY PUBLIC HEARINGS and I understand the attached information (a bit biased towards the incinerator industry, wouldn't you say?) was distributed.

I see this document does not mention Wheelabrator's hundreds of legal actions.

Why does it not talk about the 30 years of subsidies which will be necessary to keep this facility online? Subsidies which will be paid through property owners and the haulers via their tipping fees?

If this proposed incinerator is "compatible" with recycling, where in the contract are there penalties for burning recyclable materials? (And actually, aren't there bonuses to Wheelabrator for the more material burned, regardless of what the composition of it is?)

If the ash is safe for landfill cover, why did you not mention the places which ban incinerator ash for this purpose?

What local water protection groups would agree with the statement that this incinerator will "help improve water quality in the Potomac River"?

Why are you saying this will preclude the need for a new landfill since there will still be non-processable waste prior to incineration (10-15%) , and even if the ash were to be used for landfill cover, it's still going into the landfill.

With a shared bond payment of over $30M per year for over 30 years, and operating and maintenance costs which can easily be estimated to be at least $30M per year, how can this be a "competitive" in cost? Where is the comparison information from which you cite?

Then this document discusses the jobs and money which start to flow during the construction phase. But of course, it's fairly well known that "green jobs" would be larger in number for members of this community. But that wouldn't assure millions of dollars going to Wheelabrator's office in New Hampshire for the next 20-30 years, now would it?

Mr. Lyons, will you please send a distribution list of everyone who received this document so complete and accurate information can also be provided?

Still looking forward to your responses, or those from Wheelabrator's or Waste Management's Media Relations Dep't.

Sent 03/02/09:

Over the weekend I received several inquiries if there has been any action by the "outraged" BoCC about the Wheelabrator press release dated 2/3/09? Has a retraction been issued by Wheelabrator?

Further, during the hearings of the week of Feb. 16th, [name removed] made a statement that she believed there should be full disclosure by Wheelabrator about several items, including emission violations, paid and unpaid fines, legal battles, fatal and non-fatal accidents, etc.

Someone sent me a list of lawsuits against Wheelabrator. It appears most of these do not have to do with its incinerator operations, but it is still alarming to consider inviting a company to this community which has been involved in such a larger number of legal actions. Is there an explanation of 522 lawsuits to which Wheelabrator or one of its subsidiaries has been involved?

Mr. Lyons, will Wheelabrator be voluntary providing the other disclosures [name removed] has requested?

Awaiting your response.

Sent 02/09:

Mr. Lyons, your silence speaks volumes.

Here is a link to the press release you generated.

To which news organizations did you send this press release? And while we're on the subject, will you please explain the bullet points in this list of disclaimers? Sounds like excuses for Wheelabrator to drain more money from this community.

In particular, will you please see what I put in bold and explain how this supports claims by Ms. Davidov and Comm. Gardner that a trash incinerator is compatible with recycling?

Again, we look forward to your response.

The Company, from time to time, provides estimates of financial and other data, comments on expectations relating to future periods and makes statements of opinion, view or belief about current and future events. Statements relating to future events and performance are “forward-looking statements.” The forward-looking statements that the Company makes are the Company’s expectations, opinion, view or belief at the point in time of issuance but may change at some future point in time. By issuing estimates or making statements based on current expectations, opinions, views or beliefs, the Company has no obligation, and is not undertaking any obligation, to update such estimates or statements or to provide any other information relating to such estimates or statements. Outlined below are some of the risks that the Company faces and that could affect our financial statements for 2008 and beyond and that could cause actual results to be materially different from those that may be set forth in forward-looking statements made by the Company. However, they are not the only risks that the Company faces. There may be additional risks that we do not presently know or that we currently believe are immaterial which could also impair our business. We caution you not to place undue reliance on any forward-looking statements, which speak only as of their dates. The following are some of the risks that we face:

competition may negatively affect our profitability or cash flows, our price increases may have negative effects on volumes and price roll-backs and lower than average pricing to retain and attract customers may negatively affect our yield on base business;
we may be unable to maintain or expand margins if we are unable to control costs or raise prices;
we may not be able to successfully execute or continue our operational or other margin improvement plans and programs, including pricing increases; passing on increased costs to our customers; reducing costs due to our operational improvement programs; and divesting under-performing assets and purchasing accretive businesses, any of which could negatively affect our revenue and margins;
weather conditions cause our quarter–to-quarter results to fluctuate, and harsh weather or natural disasters may cause us to temporarily shut down operations;
inflation, higher interest rates and other general and local economic conditions may negatively affect the volumes of waste generated, our financing costs and other expenses;
possible changes in our estimates of costs for site remediation requirements, final capping, closure and post-closure obligations, compliance and regulatory requirements may increase our expenses;
regulations may negatively impact our business by, among other things, restricting our operations, increasing costs of operations or requiring additional capital expenditures;
climate change legislation, including possible limits on carbon emissions, may negatively impact our results of operations by increasing expenses related to tracking, measuring and reporting our greenhouse emissions and increasing operating costs and capital expenditures that may be required to comply with any such legislation;
if we are unable to obtain and maintain permits needed to open, operate, and/or expand our facilities, our results of operations will be negatively impacted;
limitations or bans on disposal or transportation of out-of-state, cross-border, or certain categories of waste, as well as mandates on the disposal of waste, can increase our expenses and reduce our revenue;
fuel price increases or fuel supply shortages may increase our expenses or restrict our ability to operate;
increased costs to obtain financial assurance or the inadequacy of our insurance coverages could negatively impact our liquidity and increase our liabilities;
possible charges as a result of shut-down operations, uncompleted development or expansion projects or other events may negatively affect earnings;
fluctuating commodity prices may have negative effects on our operating revenue and expenses;
trends toward recycling, waste reduction at the source and prohibiting the disposal of certain types of wastes could have negative effects on volumes of waste going to landfills and waste-to-energy facilities; [emphasis added]
efforts by labor unions to organize our employees may increase operating expenses and we may be unable to negotiate acceptable collective bargaining agreements with those who have been chosen to be represented by unions, which could lead to labor disruptions, including strikes and lock-outs, which could adversely affect our results of operations and cash flows;
negative outcomes of litigation or threatened litigation or governmental proceedings may increase our costs, limit our ability to conduct or expand our operations, or limit our ability to execute our business plans and strategies;
problems with the operation of our current information technology or the development and deployment of new information systems could decrease our efficiencies, increase our costs, or lead to an impairment charge;
the adoption of new accounting standards or interpretations may cause fluctuations in reported quarterly results of operations or adversely impact our reported results of operations; and
we may reduce or eliminate our dividend or share repurchase program or we may need to raise additional capital if cash flows are less than we expect or capital expenditures or acquisition spending are more than we expect, and we may not be able to obtain any needed capital on acceptable terms.

Additional information regarding these and/or other factors that could materially affect results and the accuracy of the forward-looking statements contained herein may be found in Part I, Item 1 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2007.

Sent 02/25/09:

Mr. Lyons,

In addition to answering the previous questions asked, will you please explain what press release you or Ms. Davidov distributed? (I'd ask Ms. Davidov, but emails are bouncing back from her email address.) And preferably please attach a copy here.

Also, it seems like a retraction about this being "a done deal" seems to be in order, and of course this should be sent to ALL news organizations. We hope to hear of your timely response in doing so.

Looking forward to your reply,

Caroline Eader

Sent 02/24/09:

Hi All:

I know this may be late in the game, but whatever apologies for mistakes or miscues related to or by Wheelabrator re the releases are false.

The only way a Press Release gets on PR Newswire is by being sent to that service as a full release by the originator, in this case Wheelabrator. Or NMWDA. I use services like that all the time.

It's a paid service for press releases.

No accidents here.

HAMPTON, N.H., Feb. 3 /PRNewswire-FirstCall/ -- The Northeast Maryland Waste Disposal Authority, in conjunction with the Frederick County Division of Utilities and Solid Waste Management and Carroll Country Department of Public Works, has selected Wheelabrator Technologies Inc., a wholly owned subsidiary of Waste Management, Inc.

Sent 02/09:

Yes, and note the date of the news report, Feb. 16th. Being in the communication field myself, the release from Wheelabrator would have been developed days earlier on average, then submitted to the media at the latest the day before this article dropped. So, in essence, the release would have been developed most probably two weeks ago. Something smells here.

Sent 02/24/09:

Mr. Lyons,

Everyone on this email string has now seen the letter you wrote to Comm. Jan Gardner dated 2/20/09.

So, it's the Gazette's fault that Wheelabrator appears to be licking its chops in regard to placing the first incinerator in over a decade in Frederick, Maryland? As asked below, "What is inaccurate? What [you] said or the fact [you] said it?"

And then who is to blame for the "Waste & Recycling News" and the "iStockAnalyst" articles? Surely not the Gazette?

Any clarification you provide would be helpful.

Sent 02/24/09 to Jan Gardner:

Thank you Commissioner Gardner for sharing the letter from Mr. Lyons of Wheelabrator. It is a pretty transparent attempt to deflect from Wheelabrator’s clear effort to pressure the county by pre-announcing victory. They know contract award/selection is not quite the same as a signed contract.

I am reminded of the movie Casablanca, Captain Renault has just shut down Rick’s place on the pretext of illegal gambling. He is “shocked and dismayed” to discover gambling on the premises. That is until he is handed his winnings on his way out the door. Mr. Lyons dismay at “a grossly inaccurate statement attributed to me” could be seen in the same way.

What is inaccurate? What he said or the fact he said it? Let’s stop this before he gets to the door with our money.

Reply from Jan Gardner, 02/24/09
Subject: Wheelabrator Announces LTE Plant Win

Both Comm. Jenkins and I made statements at the beginning of last Thursday's public hearing expressing our outrage and concern about the inappropriate and factually incorrect comments attributed to Wheelabrator in last week's Gazette. I have also taken exception to some of their press releases which also imply that a decision has been made.

No decision has been made by the Frederick County Commissioners regarding whether to proceed with WTE.

Please see the attached letter, received yesterday from Wheelabrator on this topic.

Regards,

Jan

[See Wheelabrator's press release].

Incinerator revenue bonds

Sent 07/13/10:

[Jan said:] "... the fact that the electricity revenue from this WTE facility will pay most or all of the revenue bonds (ie the revenue to pay the bonds)."

Although issued by the Authority, the Revenue Bonds will be paid in full by the respective Counties.

Revenues will include electricity and ferrous sales, tipping fees and Service Benefit Charges (SBC are found on property owners tax bills.)

The highest electricity revenues (which have been provided) by Mont. Co's 1800 TPD trash incinerator is $26.4M. (Overall revenue from electricity & ferrous revenue = $28.6M)

The overall debt service is estimated to be $37.1M/yr. (Please see attached PDF on Montgomery County's incinerator and analysis.)

In addition to the debt service the counties will need to pay the $23M+ in operating fees (This gets paid first and foremost per the contract), and ongoing maintenance and retrofits.

pg. 59 SECTION 6.1. GENERAL BOND RESOLUTION.
(A) Issuance of Revenue Bonds. The General Bond Resolution shall provide for the issuance of Revenue Bonds by the Authority, subject to the requirements of Applicable Law, for the purpose generally of providing funds for the capital purposes of the Facility. These purposes shall include the payment of the Design-Build Price to the Company, the costs of Capital Modifications to the Facility, other improvement and capital asset costs, and costs of issuance, capitalized interest and reserves associated with the issuance of and security for the Revenue Bonds. The Revenue Bonds shall be secured by the Facility Revenues and the covenants of the Authority undertaken with respect thereto under the General Bond Resolution. The Authority shall use good faith efforts to issue Revenue Bonds at the times and in the amounts required to provide funds for the payment of the Design-Build Price to [Wheelabrator] hereunder. The Authority otherwise shall have sole discretion to determine the maturity, interest rates, redemption provisions, tax-exempt or taxable status, security, timing and method of issuance, issue size, and all other terms and conditions of the Revenue Bonds and their offering and sale. The Authority also shall have sole discretion to refund, refinance or restructure the Revenue Bonds and to convert Revenue Bonds from a variable to a fixed interest rate mode or the reverse at any time without the consent of the Company. The Company shall, at its cost and expense, assist the Authority and the Counties in connection with the issuance, refunding and conversion of Revenue Bonds in accordance with customs and practices prevailing in the public finance industry for facility vendor participation in securities transactions of this nature including providing necessary representations, warranties, opinions and further assurances.

(B) Flow of Funds. The General Bond Resolution shall provide that all Facility Revenues shall be deposited in a revenue fund for application to the following purposes in the following general order of priority: (1st) to the payment of Facility Operating Expenses (including the Service Fee, except any revenue sharing component of the Service Fee and the Fixed Escalation Component of the Base Operation Fee); (2) to the payment of debt service on the Revenue Bonds to the extent not provided for from capitalized interest or other sources (debt service may include scheduled payments due under any interest rate stabilization arrangement (swap) and credit support fees); (3) to the payment of the Fixed Escalation Component of the Base Operation Fee; (4) to the replenishment of the debt service reserve fund under the General Bond Resolution; (5) termination or other unscheduled payments due under any interest rate stabilization agreement; and (6) to the Company, payment of any revenue sharing components of the Service Fee and of any other amounts to which [Wheelabrator] is entitled hereunder. The General Bond Resolution may establish additional funds and accounts and provide for deposits in such funds and accounts and for the application of Facility Revenues to additional purposes in such order and manner as may be consistent with similar financing transactions or required by the securities markets, as long as (1) the Revenue Bonds are structured so that Facility Operating Expenses (other than any revenue sharing component of the Service Fee and the Fixed Escalation Component of the Base Operation Fee) are paid before debt service on the Revenue Bonds and (2) such additional fund or account has a lower priority in payment than the payment due the Company under item (6) above.

Incinerator — Problems with financial analysis

Sent 07/14/10 to Carroll County Commissioner Mike Zimmer:

The reason that no technologies other than types of incineration showed up when there was an RFP several years ago is that the NMWDA limited the scope to thermal technologies. Dr. Mel Finstein, formerly of Arrow Bio, now with American Anaerobic Digestion, Inc., has confirmed to me that his company did not respond to the RFP because of this limitation. He wrote to me today:

I distinctly recall writing a letter to the NMWDA saying that I would not respond to their RFP because they clearly sought an incinerator. NMWDA should have that letter on file, or explain why not.

Commissioner candidate Bob Craig has requested a copy of the RFP, but the NMWDA has ignored his request, along with many others. I know that transparency is important to you....so would you please urge Robin Davidov to cooperate with residents?

Two of the many problems with the process so far have been:

Lack of transparency from the NMWDA
Lack of the identification and vetting of all possible alternatives

Mel Finstein went on to say that Were the NMWDA serious about anything other than incineration, a discussion would be in order. Companies are not going to waste their time responding to an RFP that excludes them.

So, it is inappropriate to request of commissioner candidates (and citizens) that they come up with "specifics of a new technology" when no serious study has been undertaken on any but incineration! You are not playing on a level playing field when you ask such a question. I sincerely hope that the new BOCCs for both Carroll and Frederick Counties look to all possible options in a professional and responsible manner. Commissioner Gardner has not been able to respond to Caroline's question about feasibility studies for other options because there aren't any!

From the Frederick News Post forum

Sent 08/13/10:

Originally posted by: cjenkins [Charles Jenkins, state delegate and former Frederick County commissioner]:

Bob White is a class act, through and through. I visited his home this afternoon specifically to discuss WTE (he had no idea I'd be showing up). We had a nice half hour visit and I expressed my concern about his position. He listened, I listened. What I took from my visit is that Bob is not such an idealogue that he won't listen to reason and argument if the decision is put on his shoulders and he'll be reaching out to Mike Marschner for additional information. Bob was on the FCPC when they ultimately found the Solid Waste Management Plan consistent with the Comprehensive Plan, clearing a low hurdle for the project. I told Bob I have tremendous respect for him and for his service to the County, but the issue of WTE is of paramount importance to me and to the long-term interest of the County.

Response by Caroline Eader:

I hope you talked about the contractual and financial terms. Things like the fact that the spreadsheets use a 750khw/ton when there's not plant in the world which reaches that number. (702 kwh/ton is the highest we've been told of.) That the supposed "guarantee" is not guaranteed if the heat value of our trash falls below a certain BTU. (And that the materials with the highest BTUs are the most recyclable.)

And did you talk about the Capital Contribution by Wheelabrator? Do you have any concern that the $73M million Wheelabrator is willing to provide MUST be paid back to them in the form of monthly payments (starting at $3.5M per year) for 20 years? And the payments are based upon $73M, even if the whole $73M is not used? That the contract specifically states they get back any unused funds, but there are no provisions to lower our payments if that happens?

And did you talk about the fact the NMWDA changed the cost-index they have in the first draft, and by doing so increased the payment to Wheelabrator by $26M? And did you discuss any concerns you might have about the $500,000/year payment from Wheelabrator that NMWDA figured into the contract for themselves? And how about the fact that if the plant is burning at over 92% of capacity Wheelabrator gets half the electricity revenue. Why is that?

Mr. Jenkins, since you agreed to this contract, I'm hoping you can share with us all the wonderful terms and agreements which makes this of "paramount importance" for the citizens of Frederick County to finance.

A Vision of Frederick County's Future? Incinerator = bankruptcy or just higher SBCs?

Sent 05/12/10:

"The MSRB's Taylor said the incinerator financing from the beginning was 'silly.' 'Anybody who's studied incinerator bonds for the last 30 years would find most of them had great difficulties, if not defaults,' he said. 'Where were Harrisburg's brains?'"

Special report: The incinerator that may burn muni investors

HARRISBURG, Pennsylvania (Reuters) - The story of how Pennsylvania's capital city Harrisburg has lurched toward the precipice of financial ruin is a cuckoo tale involving one man's vision of creating a hub for museum lovers, a possible FBI investigation, and a $45,000 tomahawk that may or may not have been owned by Chief Crazy Horse.

But if this historic city of nearly 50,000 does end up defaulting on its debt -- a move that would send shockwaves through the $2.8 trillion municipal bond market -- most of the blame can be placed squarely on a single incinerator.

A financing scheme to fund its state-of-the-art trash-burning plant has left the 150-year-old Harrisburg scrambling to pay $68 million of interest this year. The payments exceed the annual city budget by some $3 million and the city council has recently begun to explore a possible bankruptcy filing, an event that would cast a shadow far beyond the Keystone state.

Municipal bankruptcies are extremely rare. The tax-exempt municipal bond market, where states, counties, cities and towns borrow money to pay for roads, schools, bridges and hospitals, is generally considered a safe investment with a far-lower default rate than the corporate bond market.

As the recession has continued to grind away at state and local government revenue, however, fears of a spike in defaults have risen, unsettling investors and shining an unwelcome spotlight on Harrisburg's financial woes.

The Harrisburg Authority, a municipal entity dedicated to building and financing public works such as sewers, missed a $425,282 payment due May 1 on some of its $282 million of incinerator debt because its reserve fund is depleted.

The city, the surrounding Dauphin County and bond insurance company Assured Guaranty Municipal Corp back some of the authority's debt and Assured made the May payment. But that still leaves Harrisburg residents on the hook for a large part of the costs of the bonds.

Adding to the financial morass is Harrisburg's long-serving former mayor, Stephen Reed, who dreamed of bolstering the area's economy by acquiring relics from the American West. He acknowledges that he directed funds from the authority and toward his vision of turning the city into an oasis of themed museums.

It hasn't worked out that way.

LIVING UNDER A CLOUD
To understand how a lone incinerator could create such a burning financial crisis, go back to 2003. That year, the federal government called for the plant to be shut down -- it was releasing dioxin, which is linked to cancer and birth defects. The trash burner had also raised the ire of activists, who pointed out that some of the area's poorest families lived directly under its clouds.

In response, the Harrisburg Authority revamped the nearly 40-year-old incinerator. Called the "Harrisburg Resource Recovery Facility," the fixed-up plant reopened in 2008 and was expected to burn more cleanly, while raising cash from trash collected across Dauphin County. There are 87 such waste-to-energy plants in the United States and many, including Harrisburg's, also harvest ferrous metals from the trash to sell, bringing in much-needed revenue.

The authority's financing for the incinerator was a Rube Goldberg contraption. According to data supplied by Harrisburg Controller Dan Miller, the authority issued 11 sets of bonds to build, refinance, expand or repair the incinerator between 1969 and 2003. The largest was $125 million in 2003.

Half of this year's scheduled payments, $34 million, is supposed to go to Bear Stearns, now a part of JP Morgan Chase, for a working capital loan on the retrofitted incinerator. But it is another loan that has many people confused.

The authority did not issue a performance bond, a type of insurance on the contractor finishing work on a project. As a result, it was caught short when the contractor pulled out. Citizens and officials want to know why such a standard bond was never issued.

The authority had to turn to Covanta Energy, the new operator, to finish the work and borrowed nearly $22 million from the company. According to a Covanta filing, the company authorized a loan of up to $25.5 million.

The Covanta filing said that $19.8 million of Harrisburg's debt remains outstanding and that the city is negotiating forbearance for a $600,000 payment that was due April 1.

That was only the second scheduled payment due on the debt in 2010. Altogether, the authority was supposed to make four payments this year to the energy company for a total of $2.55 million, said authority Executive Director Michelle Torres.

Citing the city's "precarious financial condition with substantial obligations," Covanta said it intends "to work with the city of Harrisburg and other stakeholders to maintain our position in the project and to protect the recovery of our advance."

WANT TO SWAP?
Then there are the swaps.

Harrisburg is one of a multitude of municipalities in Pennsylvania that purchased swaps to hedge against interest rate risk.

The Harrisburg Authority entered into three swaps for its 2003 bonds in the hopes of lowering net interest costs on the debt. Two swaps mature by 2013 and one will run until 2033, according to the authority. Beginning in 2005, the authority began making payments on the agreements it had made with the Royal Bank of Canada.

Typically, if an issuer cannot make a payment the counterparty is free to end the swap and issuers pay steep termination fees. The Harrisburg Authority put guaranties on its swap payments.

As a result, if it could not make a scheduled swap payment, then the city would. If the city could not, then Dauphin County would. That's what happened last summer, and the county is suing the city and the authority to recoup $775,652.93 for a June 1, 2009 swap payment.

Swaps, and their hefty termination fees, are currently under the regulatory microscope as the economic recession makes cash scarce for state and local governments.

Pennsylvania's auditor general has launched a campaign to convince local governments to avoid swaps, or to end current agreements, and the state legislature is looking into banning them altogether. Last year, many of the state's school districts, which had been desperate for cash, were burned by swaps that included large termination fees that are, as the Auditor General Jack Wagner put it, "lining pockets on Wall Street."

The U.S. Congress is also mulling new disclosure and fiduciary responsibility requirements for swaps and other financial instruments that cities and states use, but don't always understand. And for more than two years, since the bond insurance industry melted down and the credit market froze, House Financial Services Committee Chairman Barney Frank has proposed legislation to create safeguards for municipal bond issuers.

Still, few of those protective measures have yet become law and the reality is that many financial instruments are puzzling for those whose feet never tread on Wall Street.

"Finance officers may yell at me, but the truth is that they didn't go to Wharton," said Christopher "Kit" Taylor, who was head of the Municipal Securities Rulemaking Board (MSRB) for decades until 2007. He was referring to the University of Pennsylvania's prestigious business school.

THE MUSEUM DREAM
Alongside that tomahawk, wagon wheels, rifles, saddles, Indian effigies, photographs, furniture and a stuffed buffalo have all been gathered in a Harrisburg brick warehouse to fill a museum that was never built. The artifacts, together with thousands of others ranging from a Civil War machine gun to an ancient Sumerian necklace, were purchased by Reed when he was mayor, as part of his dream of turning the former industrial town into a museum hub.

The museum featuring Western memorabilia would commemorate the city's role in America's westward migration, even though Harrisburg, which runs along the Susquehanna River just off the Appalachian Trail, is located more than 1,000 miles away from the Alamo and other iconic landmarks of the Old West.

Needing cash, the city has only been able to sell a small portion of the artifacts. A Dallas auction house recently took just 850 items, suggesting the remainders -- the vast majority of the total collection -- have little value. The city did establish a small National Civil War Museum, ringed by a largely empty parking lot on a hill, which must compete with a more popular museum nearby at the famous Civil War battleground of Gettysburg.

Reed, who lost a re-election battle in November after 28 years in office, said a total of $15 million was spent on the artifacts. The money came from a special projects fund supported by fees earned on bonds issued by the Harrisburg Authority for capital projects. Reed contends that none of what he spent was related to the incinerator bonds.

Eric Papenfuse, a former member of the authority's board, says those numbers are wrong. Papenfuse runs his Midtown Scholar used book store and coffee house in a remodeled movie theater across from the Broad Street Market, where members of the Pennsylvania Dutch community sell meats, produce and pastries.

Papenfuse contends at least $30 million was spent on the artifacts, which should never have been purchased with funds from an organization whose mission is to improve public infrastructure.

"This entire thing was the wrong spending of public funds," said Papenfuse, who ran unsuccessfully for city council last November.

Reed confirmed that larger items were collected from vendors around western states by his aide John Levenda, who rented a truck and was sometimes accompanied by a uniformed Harrisburg policeman.

He argued this had saved the city "considerable sums" that would have been spent on shipping and packaging, according to a September 7, 2004 letter from the mayor to the authority that was published by Papenfuse during his election campaign.

Alarmed by the spending, Papenfuse contacted the Federal Bureau of Investigation, which, he said, was already looking into claims of corruption in Harrisburg city government. The bureau told him it would look into the matter, but then cut its ties with him after he went public with the accusations during his run for city council, Papenfuse said.

The FBI refused to confirm or deny the existence of any investigation into Harrisburg's finances.

ECONOMIC REVIVAL

Reed rejected criticism that the city should never have spent bond fees on such items, because he believes his vision could have brought in money and helped the town flourish.

"The whole point wasn't historic preservation," he said. "It was designed to boost tourism in our local economy."

That local economy was all but dead in the 1970s and early 1980s -- until Reed became mayor while still in his thirties -- as it suffered from people moving out of the urban core.

Now, on warm spring nights independent bars and restaurants along Second Street, steps from the capitol building, throw open their windows and doors and put tables out on the sidewalks. According to city documents, Harrisburg had 8,658 businesses on its tax rolls in 2008, more than four times the 1,903 businesses in 1982.

Residents say it's ironic that during this awakening, the city faces the prospect of bankruptcy.

Still, prosperity has been uneven. In the shadow of the incinerator, people mill through rows of subsidized housing during the middle of the day. Vacant homes line the main road that leads to the Civil War museum. The city's median income in 2008 was $34,037, well below the statewide level of $50,713, according to City-data.com.

Reed, who now consults on economic development and government relations, said there is no connection between the artifacts and Harrisburg's crippling incinerator debt.

He argued his debt-reduction plan failed because of opposition from the current mayor, Linda Thompson, a former city council member who used the debt crisis to criticize Reed during her successful campaign in 2009.

Asked in a February interview whether Harrisburg would file for Chapter 9 bankruptcy, Thompson replied: "Absolutely not."

She said Pennsylvania Governor Edward Rendell has for now ruled out a state takeover of Harrisburg's finances under what is known as "Act 47." In the meantime, Thompson has suggested leasing or selling Harrisburg's assets such as parking lots.

TRASH-O-NOMICS

Collecting enough trash to make the incinerator cost effective has been a problem. The burner is designed to process 800 tons per day of solid waste, generating 24.1 megawatts of energy. Instead, according to recent authority reports, it processed 656 tons per day in March and 602 tons per day in February. In April, the local newspaper reported that haulers were dumping collected garbage in illegal sites to avoid paying the "tipping fees" for leaving it at the incinerator, shorting the authority of at least $300,000 annually. According to The Patriot News, a county employee paid $15.47 per hour now follows the trucks to ensure they make it to the incinerator.

The MSRB's Taylor said the incinerator financing from the beginning was "silly." "Anybody who's studied incinerator bonds for the last 30 years would find most of them had great difficulties, if not defaults," he said. "Where were Harrisburg's brains?"

TARNISHED REPUTATIONS

Filing for rarely used Chapter 9 municipal bankruptcy is a multi-step process that takes months to complete and that few cities or counties have ever undergone. For Harrisburg, the consequences of being unable to make the payments due before the end of the year have already begun raining down.

City Controller Miller told Reuters the city should consider bankruptcy, or negotiate a reduction of the debt with bondholders, but added that he is not sure how Harrisburg plans to handle the problem. "The mayor doesn't speak to me," he said.

He is urging the city not to sell its parking assets because they generate about $18 million a year, or about a third of general fund revenue. If those fees disappear, Harrisburg would likely have to impose a massive tax increase, he said.

Last month, the city council approved measures on how leases and sales of assets could be conducted, but with heavy restrictions, including barring any lease or sale until Harrisburg fully explores the option of bankruptcy.

Mayor Thompson reportedly is hiring a financial adviser and expects to have a plan in place by June.

But rating agency Moody's Investors Service says the incinerator debt will remain a burden for Harrisburg that "will stress the city's finances for the foreseeable future, negatively affect its creditworthiness, and jeopardize its future access to the public credit markets."

In the meantime, Harrisburg residents are stewing.

Ann Knaus, who has lived in Harrisburg eight years and lobbies the state government for the Natural Resources Defense Council, likens the incinerator to the so-called Big Dig in Boston -- the tunnel Boston took 16 years to build that went more than $10 billion over budget and is often considered the costliest highway project in U.S. history.

Her husband, Kurt, said he worries about what a default would do to Harrisburg's reputation and that of Pennsylvania.

"It doesn't say much about a state when the capital goes bankrupt," he said.

(Additional reporting by Jon Hurdle in Harrisburg and Karen Pierog in Chicago, editing by Jim Impoco and Claudia Parsons)

Wheelabrator Frederick Project Operation Fee

Sent 04/12/10 to Robin Davidov, executive director, Northeast Maryland Waste Disposal Authority:

Ms. [Robin] Davidov — Perhaps you could supply the fully executed contract showing the current Base Operation Fee in support of the statement from Mr. Lyons?

If you see here (from the County website), Section 15.3 shows the Base Operating fee went to $19,878,455.00 — an increase from the $19,211,455 in the Jan. 2009 draft contract:

Service Contract (1-26-09 compared to 7-2-09)

The Base Operation Fee represents the Company’s compensation for providing the Operation Services including the combustion of the Tonnage of Processible Waste equal to or below the annual waste processing threshold determined in accordance with Appendix 20. The annual Base Operation Fee shall be the sum of the Indexed Escalation Component of the Base Operation Fee and the Fixed Escalation Component of the Base Operation Fee. The annual Indexed Escalation Component of the Base Operation Fee shall be Nineteen Million Eight Hundred Seventy-Eight Thousand Four Hundred Fifty-Five Dollars ($19,878,455.00).

Also, when will those additional spreadsheets be provided in regard to the range of KWh/ton as allowed in the Service Contract?

Subject: FW: Wheelabrator Frederick Project Operation Fee
Date: Mon, 12 Apr 2010 14:17:14 -0400
From: Robin Davidov, executive director, Northeast Maryland Waste Disposal Authority
cc: Mike Marschner, director of Frederick County's division of Utilities and Solid Waste Management, and J. Michael Evans, Carroll County commissioner

I have responded several times that the Base Operating Fee is $19,211,455. In order to prove this to you, I have attached a confirmation from Wheelabrator.

Regards, Robin

From: Mark Lyons at Waste Management
Sent: Monday, April 12, 2010 12:20 PM
Subject: Wheelabrator Frederick Project Operation Fee

This e-mail message will confirm that the Indexed Escalation Component of Wheelabrator’s Base Operations Fee under the Frederick WTE project service contract is $19,211,455, not $19,878,455.

Please let me know if you have any questions. Thank you.

Harvey, you're wrong again

Sent 05/29/10 to Harvey Alter and others:

The contract does not support what you claim in your letter to the editor. I'm afraid you're the one spreading the misinformation.

Harford's tra$h incinerator

Sent 06/04/10:

Comm. Zimmer - I find it interesting that now you hear the Harford trash incinerator was designed to last just 20 years. I've never heard this before, and in fact on the Harford website it states, "The normal useful life of such facilities is at least 30 years..." (emphasis added)

So, "these facilities" are suppose to have "at least" a 30 year life, but this one is only going to have been in service 28 years before it's worn out.

So again, I must ask does anyone have the specs for the facility the NMWDA wants to put in Frederick County, AND does anyone think the contract should be amended to include a guarantee from Wheelabrator that this "new" facility will last at least 30 years? (And of course any such guarantee cannot have an "out" like the electricity revenue guarantee does.)

And please don't forget that whatever else the website claims, the Harford Final Environmental Assessment states, "The existing facility is approaching the end of its useful life which will make complete upgrades uneconomical and unsuccessful at achieving an increase in operational efficiency." And who is paying for the deconstruction of this facility?

Also, I would like to caution you about what you may read since I received an email advertising a tour of the Harford facility which stated,"Turning Trash into Money. " However, you'll see by the spreadsheets attached here that Harford also must subsidize it's 360 TPD trash incinerator by several million dollars per year.

And thank you Comm. Zimmer for your help in obtaining these spreadsheets for Harford Co.'s trash incinerator. How are we coming in getting the live Excel spreadsheets for the financial projections for our project?

Beware of politicians who want to use public funds for the benefit of private industries.

Sent 05/28/10 by Carroll County Commissioner Michael Zimmer:

Friends,

Some time ago I suggested that a review of Harford County situation and the Durham region of Ontario Canada would be useful context to the notion of whether WTE remained a viable choice or not.

Both are in the process of building a new WTE plant that will burn MSW from multiple jurisdictions. In other words their choice is the same as the direction set by the current majority of both Boards in our situation.

One of the best ways to evaluate the status of those other jurisdictions would be to review their web sites. Harford’s is located at http://www.harfordcountymd.gov. At that site if you enter a search for waste to energy it will pull up a boat load of information regarding their current practices and future plans. Incidentally, it has been suggested that their current plant which uses old technology was designed with a useful life of 30 years. I’m informed that that’s not correct. The original design was for a 20 year useful life. Assuming my information is correct then it would seem that Harford citizens are getting a bit of a bonus out of this plant. If someone from either the Authority or Harford County could confirm this information that would be good for all concerned.

The Durham region of Ontario Canada is also an excellent example of a collection of jurisdictions that have embraced WTE as a long term and cost effective solution to their MSW needs. Their site can be found at http://www.durham.ca. The preferred search term for that site would be waste from energy. It is curious how different groups use similar yet slightly different terms from time to time.

I certainly welcome civil discussion on the policy implications of WTE. Thankfully most folks seem to welcome that approach.

Turning Trash into Money (Harford County Incinerator)

Sent 04/21/10 to Robert B. Cooper, P.E, director of Public Works, Harford County:

Hello Mr. Cooper,

Would you be so kind as to forward the Annual Statements for this facility so we can review the numbers for this "Turning Trash into Money" facility?

Thank you for your time.

Sent 04/22/10:

Click here to review the Final Environmental Assessment.

If you scroll to 29: "The existing facility is approaching the end of its useful life which will make complete upgrades uneconomical and unsuccessful at achieving an increase in operational efficiency."

See Resource Destroying Facility article.

Sent 03/29/10 by Carroll County Commissioner Michael Zimmer:

Were you aware that Harford County is in the process of siting a new and larger replacement plant? How does that figure into your suggestions [not shown]?

Sent 04/26/10 from Carroll County Commissioner Michael Zimmer:

I don’t find any validity to the assertions you have made [e-mail not shown]. The Army wants more steam energy to heat and cool Aberdeen Proving Ground. The BRAC process has led to more jobs to be directed to Aberdeen. This means more buildings needing hvac energy. Baltimore County and Harford County have growing needs for msw disposal. This is the classic win-win-win scenario.

It kind of reminds me of a project that could be built a bit to the west of Harford County.

Sent04/26/10 to Carroll County Commissioner Mike Zimmer; Frederick County Commissioners; Mike Marschner; Ron Hart, county manager; and others:

[re: Resource Destroying Facility article]

And please note these comments,

"The normal useful life of such facilities is at least 30 years..."

"The existing combustion and process equipment will approach its projected service life in 2016..."

"The Harford County Waste to Energy Facility, now an Authority owned facility, began operations in 198 8— from the NMWDA website

So, "these facilities" are suppose to have "at least" a 30 year life, but this one is only going to have been in service 28 years when it's worn out.

Comm. Zimmer — will the NMWDA's trash incinerator which is to be located in Frederick reach its "projected service life" before the bonds are paid off? I didn't see any guarantees in our contract about the life expectancy of this facility.

Fairfax doesn't have enough trash for its incinerator

Sent 05/16/10:

Several people sent me this article. (Thanks to all of you.)

"Municipalities rushed to build expensive incinerators in the 1980s through bond referendums, but a 1994 U.S. Supreme Court decision stopped local governments from controlling trash collected within their boundaries. Soon, the cost of trash burners exceeded revenue in many areas, and large landfills built by private companies in central Virginia offered trash haulers lower disposal rates, undercutting the incinerators by as much as half.

Fairfax responded by slashing its prices, and government subsidies helped get the plant back in the black."

And although the tone of this article seems to be "Rah rah for trash incineration" I notice the bottom-line is that Fairfax doesn't have enough trash to feed the beast with "people buying less and consuming less." Duh.

D.C.'s trash is now Fairfax facility's treasured commodity

Harold Taylor, a Fairfax County employee, handles trash at the massive trash-to-energy plant in Lorton. Because of the economic downturn, trash collection dipped 15 percent in the county in the past two years, as people hung on to items they might have discarded in better times. An agreement with the District is helping to ameliorate the situation. (Jahi Chikwendiu/the Washington Post)

By Derek Kravitz
Washington Post Staff Writer
Saturday, May 15, 2010

Fairfax County is in need of trash -- and a lot of it.

With collection of trash and recyclables in the county falling by about 15 percent over the past two years because of the economic slowdown, Fairfax has had to ramp up business at its massive waste-to-energy facility in Lorton by agreeing to take in all of the residential garbage collected in the District, to the tune of 200,000 tons a year.

The agreement, a revision of a previous contract that took effect this month, gives Fairfax and Covanta Energy, the private contractor that operates the county's waste plant, an additional $2.2 million-a-year revenue stream.

Fairfax operates the largest waste-to-energy facility in the Washington region, on a 23-acre site in the far southeastern part of the county that once was home to a prison. The I-95 Energy/Resource Recovery Center's four furnaces handle about 3,000 tons of garbage a day, virtually all of the residential and commercial trash collected in Fairfax and the District that doesn't head directly to a landfill.

At its height several years ago, the plant processed about 1.1 million tons a year. But with people buying less and consuming less, the trash haulers have seen their totals drop. Last year, the Lorton facility processed 992,000 tons of trash and recyclables, about 75 percent of it coming from Fairfax's 1 million residents. Its capacity is about 1.2 million tons annually, depending on such variables as rainfall during the year (with more moisture, garbage becomes heavier).

To get the extra garbage and to reflect current market conditions, Fairfax reduced its trash "tipping" fees -- which jurisdictions charge to dump a truckload of trash at incinerators and landfills -- from $31 a ton to $29.

"We've leveled off, but we want to operate at as close to capacity as possible," said Joyce Doughty, director of Fairfax's Division of Solid Waste Disposal and Resource Recovery. "We heard D.C. was looking, and it worked out in our models, so we were happy we were able to accommodate."

District officials say the deal allows them to avoid hauling their extra waste to a private landfill 120 miles away, near Richmond.

This is the environmentally right thing to do," said Linda Grant, a spokeswoman for the D.C. Department of Public Works. "We can reduce our carbon footprint by using the waste-to-energy facility rather than a landfill. By using the Fairfax facility, we are providing them with the trash they need to meet their electricity-production goals."

The $29 tipping fee is "very low, historically, for that facility," said Steve Yob, president of the Virginia chapter of the Solid Waste Association of North America.

The Fairfax-District agreement increases the amount of garbage Fairfax gets from its urban neighbor to 200,000 tons a year, up from 125,000 tons. The two localities are entering the third year of a five-year contract.

One of the largest facilities of its kind in the country, the Lorton plant is the biggest owned by New Jersey-based Covanta Energy. It sells about $20 million worth of energy the plant produces, in the form of steam that turns wind turbines, to Dominion Virginia Power.

The county hauls trash from only about 12 percent, or 44,000 households, in Fairfax, but the Lorton plant is responsible for almost all of the county's residential and commercial trash and recycling through contracts with dozens of private firms.

Virginia Gov. Robert F. McDonnell (R), who has made economic development one of his chief objectives, toured the Lorton plant on Wednesday accompanied by Covanta's chief executive. He called the 20-year-old facility "part of the overall solution." Fairfax County Board of Supervisors Chairman Sharon S. Bulova (D), who called the plant "innovative," put it more bluntly: "We need to keep it fed."

Municipalities rushed to build expensive incinerators in the 1980s through bond referendums, but a 1994 U.S. Supreme Court decision stopped local governments from controlling trash collected within their boundaries. Soon, the cost of trash burners exceeded revenue in many areas, and large landfills built by private companies in central Virginia offered trash haulers lower disposal rates, undercutting the incinerators by as much as half.

Fairfax responded by slashing its prices, and government subsidies helped get the plant back in the black. It is still profitable. And the region's unprecedented population growth over the past decade has spurred business. Just five years ago, Montgomery County projected that its solid-waste incinerator, opened in 1995 in rural Dickerson near the Frederick County line, had reached its limit. Excess garbage was piled on rail cars and trucks and carted to southern Virginia.

But then the downturn came, and trash volume plummeted. Landfills that once were expected to run out of space in a matter of months gained new life. Discarded refrigerators, sofas, clothing, shoes, batteries -- all were granted a reprieve by cash-conscious consumers.

Still, Yob said, "waste-to-energy plants make a lot of sense, especially in an area with a concentrated population, like D.C. You can't really put landfills anywhere that close to the urban areas."

Large incinerators have also been helped by time: Many initial investments in such facilities have recently been paid off or are nearing the end of their decades-long contracts, allowing localities to lower costs and bring in new customers.

"They definitely wouldn't have built something this big," Amarjit S. Riat, assistant director of the I-95 Landfill Complex, where the plant is located, said as a crane scooped up heaps of trash from a 30-foot-tall pile inside a hot, concrete-enclosed loading station. "But there's always going to be trash."

When it was built in 1990, it cost $250 million. Today, that figure would be $750 million.

Jan, where is that open and transparent government?

Sent 06/11/10 to Jan Gardner, Frederick County commissioner president; Frederick and Carroll county commissioners; and Linda Thall, senior assistant county attorney; and others:

Attached please find a Maryland Public Information Act request regarding the disclosure of the expenses for the design and development phase of the NMWDA's Regional Incinerator.

It certainly is disappointing that an official request needs to be issued rather than Frederick County having an open and transparent process of allowing citizens to know how much money is being spent on the trash incinerator 4 of its commissioners want placed in Frederick County.

"Politics is the art of preventing people from taking part in affairs which properly concern them." — Paul Valery

Sent 06/07/10 to Jan Gardner, Frederick County commissioner president; and Linda Thall, senior assistant county attorney:

Subject: FW: How much has been spent to date? ($740K and counting...)

There has been no update of costs since March 12, 2010.

Jan, would you prefer for me to send an official Maryland Public Information Act Request in order to obtain this information?

Sent 05/24/10 to Frederick and Carroll county commissioners:

Subject: How much has been spent to date? ($740K and counting...)

Hello Commissioners:

I'd like an update on the amount Wheelabrator has currently spent to date please, and as asked below, who are these vendors and what exactly are Frederick and Carroll County getting for this expenditure;

AND has anyone looked at the executed contract between NMWDA and Wheelabrator to see if the operating fee starts at $19.2M, or $19.8 million dollars?

Sent 04/05/10 to Frederick County Commissioners, Carroll County Commissioners, commissioner candidates and others:

Ms. Thall — Thank you very much for answering the billing statement question. For the record, I will be requesting monthly updates of Wheelabrator's expenditures as attached here.

Commissioner [Jan] Gardner — As Mr. Twigg expresses the public wants information, whether the tool to get this information is a FOIA or a Md. PIA. As commissioners of our counties you all have fiduciary responsibilities and therefore the citizens want to see how much money is being spent on this project prior to a new board being elected this fall.

Commissioners [Lennie] Thompson and [Blaine] Young — You seem to have misgivings about the McKinney site and how the elections in the fall might affect this project. Are you concerned enough about the excessive expenditures at this point in time to make a motion to halt the spending until December 1st? Especially since this specific location is an issue still making its way through the courts?

[Thompson] "...with the departure of Commissioner/Delegate Jenkins and the arrival of Commissioner Young, a majority of the County Commissioners are opposed to the McKinney site. If there is going to be a volte face on waste to energy, it will be far less costly if it happens sooner rather than later;"

---------- Forwarded message ----------
From: Thall, Linda
Date: Thu, Apr 1, 2010 at 9:50 AM
Subject: RE: Jan, where is that open and transparent government?

This message is in response to your March 24, 2010, Public Information Act request to Commissioner Gardner for copies of billing statements and supporting documentation and the Annual Settlement Statement as described in more detail in your letter. I have been advised by the Northeast Maryland Waste Disposal Authority that no such records exist at this time. Accordingly, there are no records that can be provided in response to your request.

Linda B. Thall
Senior Assistant County Attorney

Jan, please correct your misstatement of the "penalty"

Sent 03/13/10 to Jan Gardner:

Jan, If the NMWDA's Regional Trash Incinerator contract is canceled there is no "$3M penalty" as I've heard you state on Channel 19 and which has appeared in a couple different newspaper articles.

The contracts simply state that services to-date must be paid. (Up to $3M.) I'd suggest you look at the monthly statements (which I've been asking to receive from John Kroll for over a month), then you would know what has been spent to-date. Or should I simply prepare a Maryland Public Information Act request in order to inform the citizens of this County how their money is being spent?

If you read the contracts, you will see the terms for yourself...

This is from the contract between the NMWDA and the County:

Section 4.2 Billing of the [Disposal Fee].
(a) County Statements. For each Billing Period, the [Authority] shall render a statement (a “Billing Statement”) to the County setting forth the [County’s Fees] and any other amounts due under this Agreement for the Billing Period. For purposes of the Billing Statement, the County’s Proportionate Share of all costs shall be deemed to be sixty percent (60%), which shall be recalculated pursuant to Section 4.1(c) for the Annual Settlement Statement, as described more fully in Section 4.3. The [Authority] shall render such Billing Statement by the 25th day of the Billing Period following the Billing Period to which the Billing Statement applies, for all components of the [County's Fees]. During the first Billing Period, the [Authority] will issue a Billing Statement pursuant to which the [County's Fee] is equal to the Debt Service for the first Billing Period, and each following Billing Statement shall contain the Debt Service amount for the Billing Period following the Billing Period for which the Billing Statement is issued, so that the Debt Service for each Billing Period is paid in advance. The County shall pay the [Fee] amount listed on the Billing Statement and any other payment balance due to the [Authority] within fifteen (15) days of its receipt of the Billing Statement. Upon the written request of either the [Authority] or the County, the Billing Statement shall be prepared by the certified public accountant that prepares the [Authority's] financial statement or another accountant mutually agreeable to the parties. The cost of such preparation is a Variable Cost allocated 100% to the County.

And here's pg 50 of the contract for the NMWDA's Regional Trash Burner:

SECTION 4.5. AUTHORITY TERMINATION OPTION DURING THE DEVELOPMENT PERIOD.
(A) Convenience Termination Option Prior to Construction Commencement Date. The Authority shall have the right any time prior to the Construction Commencement Date, exercisable in its sole discretion for any reason upon seven days’ written notice to the Company, to terminate this Service Contract. Upon any such termination, the Authority shall reimburse the Company for 100% of its Cost-Substantiated costs incurred directly to third parties from the Contract Date to the Termination Date hereunder, which are directly related to the performance of the Company’s obligations, and which are necessary to be performed prior to the Construction Commencement Date, and, except as set forth in subsection 5.3(E), subject to a maximum amount of Three Million Dollars ($3,000,000.00).

A correction on your part would be appreciated.

Some people have not been getting the truth correct

Sent 05/17/10:

Hello Frederick and Carroll Counties:

I've received correspondence and phone calls that County officials and staff are telling citizens that construction of NMWDA's trash incinerator cannot be stopped.

Whether making such statements are by ignorance or by device, it is incorrect to say the NMWDA's trash incinerator is a done-deal.

Fiscally responsible officials would stop the spending (heading toward $1M) immediately since a new Board of Commissioners will be making the ultimate decision to fund the project and to incur $600,000,000 of debt on behalf of the two counties.

The section of the contract which includes the terms to cancel the project is included in the email [directly above].

"Touchy-feely" in Billions of Dollars

Sent 03/11/10 to Harvey Alter, Frederick County Solid Waste Advisory Committee:

Mr. Alter, as a member of the County's Solid Waste Advisory Committee I would advise you to please read the 19 pages of financial obligations for the NMWDA's Regional Trash Incinerator before you write your next letter to the editor.

The residents of this County will need to subsidize this Waste-of-Energy facility by tens of millions of dollars every year for 30 years.

You may also want to do to some research on pollutants. For example, as you can see here the Harford facility releases nearly 200 toxic chemicals, but the State of Maryland only regulates 12 of them. This is the science.

And no one that I know has said recycling has no cost associated with it, but here is some information about what you may consider "touchy-feely" activity:

Value of Unrecovered Material

During a Feb 4th APR Web Seminar on Recycling and the Economy, panelist Jerry Powell of Resource Recycling Magazine presented some interesting national figures on the value of non-recycled (disposed) material.

Paper: Recycling rate of 57% results in $3.1 Billion worth of material disposed annually
Aluminum cans: Recycling rate of 55% results in $1.3 Billion worth of material disposed annually
Plastic bottles: Recycling rate of 27% for HDPE, 29% for PET results in $1.6 Billion worth of material disposed annually
Steel cans: Recycling rate of 65% results in $0.4 Billion worth of material disposed annually
Glass bottles: Recycling rate of 28% results in $0.21 Billion worth of material disposed annually

Looking for more information on recycling's impact on the economy? Need resources to help understanding recycling as a material and feedstock development process, not just solid waste management? See APR's February 4 Web Seminar — Recycling and the Economy.

Regarding the "subsidy" discussion below:

Montgomery County, after counting the electricity revenue from its incinerator, pays an additional $30,000,000 - $35,000,000 per year to the NMWDA for operational, maintenance and debt service costs.

"A subsidy sub·si·dy (s?b's?-d?) is a form of financial assistance paid to a business or economic sector. Most subsidies are made by the government to producers or distributors in an industry to prevent the decline of that industry (e.g., as a result of continuous unprofitable operations) ... "

Those of us involved in this issue would also like to avoid "distortion and misrepresentation". Your letter to the editor did not set a very good example.

Commissioners, please stop bleeding $$$$$

Sent 03/29/10:

Commissioners, it does not matter if you believe the amount Wheelabrator is charging for the design and permitting work is in-line with similarly sized projects. The point is that you are not being respectful of the political climate which will bring us a new BoCC in just about 6 mos. You are also not being respectful of the fact that the legal process, which may or may not allow this site to be approved, has not been completed.

It does not matter if Wheelabrator is "fronting" these initial costs. It would be naive to think that somehow they are doing all of this work for free. Yes, it's embedded within the costs as agreed to, but it's certainly not "on their dime".

Please think of the wallets of your respective county residents. Please listen to the people who are asking you to STOP allowing Wheelabrator to laugh all the way to the bank. [See attachment.]

The electricity guarantee isn't really guaranteed.

Sent 03/15/10 from a Frederick County resident to Robin Davidov, executive director of the Northeast Maryland Waste Disposal Authority (NMWDA):

Ms. Davidov,

You said you would be happy to change the values in the financial spreadsheets in order to test the assumptions in your financial models for Frederick and Carroll Counties.

In this Wheelabrator presentation they use a value of 545 KWh/ton which seems to be a reasonable amount to enter into these spreadsheets in place of the 750 kwh/ton of waste processed you have inserted here:

Frederick Carroll Regional Energy Recovery Facility, Conservative Electric Fuel Cost Escalation
Frederick Carroll Regional Energy Recovery Facility, Conservative Electric Fuel Cost with a 25 percent One Time Increase

And also, what other facility in this country gets a consistent 750KWh/ton in its fuel value? (That was a caller's question which was not answered.)

Thank you.

Sent 03/16/10 to Robin Davidov of Northeast Maryland Waste Disposal Authority (NMWDA):

Ms. Davidov,

In addition to the 545 KWh/ton as represented in this presentation by Wheelabrator from 2006, will you please run spreadsheets using the numbers explicitly given in Appendix 2 in the contract between NMWDA and Wheelabrator? And facility currently runs at an average of 750KWh/ton? What would the composition of the waste need to be in order to have such a high BTU/ton?

Please see here:

Higher Heating Value Net Kilowatt hours per Ton (on an annual average basis)

HHV 4,500 Btu/lb. 575
HHV 5,000 Btu/lb. 635
HHV 5,500 Btu/lb. 750
HHV 6,000 Btu/lb. 765

I look forward to your answer to this and the question I have asked about the other "mismanaged" facility you referenced on March 6th.

Thank you.

Reply 03/18/10 from Robin Davidov of Northeast Maryland Waste Disposal Authority (NMWDA):

Ms. ______:

Below is a chart of actual performance at four operating plants on the East coast. As you can see, the range of net kwh/ton is 611-702 over a period of 5 years, so your suggestion to run a sensitivity at 545 kwh/ton does not fall in the range of actual experience. The proposed Frederick/Carroll facility is guaranteed to perform at 750 kwh/ton (at average higher heating value (“hhv”)) because the boiler will be of more current design than those in the older facilities shown in the chart. If the WTE facility does not generate electricity at the guaranteed level, Wheelabrator must make up the lost electricity revenues.

Regarding heating value, the largest impact on heating value is weather, wet trash has lower hhv, dry trash higher hhv, therefore the WTE facility must be designed to accommodate a range of hhv. The second impact on hhv is due to recycling programs. The more cans/bottles removed from the waste stream, the higher the hhv, conversely the more paper/plastic removed from the waste stream, the lower the hhv. Unless Frederick County’s recycling program is going to focus on one recyclable stream, say paper and not cans, the hhv balances out.

Gross and Net Kwh/ton from 2005 through 2009.

		Gross Kwh/ton	Net Kwh/ton
Bridgeport	12/31/2005	714	640
	12/31/2006	732	663
2250 tpd	12/31/2007	749	678
	12/31/2008	741	665
	12/31/2009	701	636
Falls	12/31/2005	774	686
	12/31/2006	773	687
1500 tpd	12/31/2007	763	682
	12/31/2008	752	669
	12/31/2009	721	639
Lisbon	12/31/2005	716	611
	12/31/2006	710	594
500 tpd	12/31/2007	682	591
	12/31/2008	703	610
	12/31/2009	684	600
Millbury	12/31/2005	779	698
	12/31/2006	768	690
1500 tpd	12/31/2007	785	702
	12/31/2008	744	666
	12/31/2009	719	648

Sent 03/19/10 to Robin Davidov of Northeast Maryland Waste Disposal Authority (NMWDA); Frederick and Carroll county commissioners; and others:

Ms. Davidov, thank you for providing this information. I see that the information you provided for these 4 facilities provides a range of 611-702 net KWh/ton and therefore, should the spreadsheets be adjusted to show these ranges?

Your current models show long-hauling would be less costly for the first 12 years after the facility is built. How much longer would long-hauling be cheaper than incineration if you consider the KWh/ton you provide below?

Also, it appears that based upon language within the contract, Wheelabrator can be exempted from its annual electricity production guarantee if the btu levels of the waste are too low (since of course btu is related to the KWh/ton produced).

Is this correct?

Article XV - Service Fee and Other Payments - pg. 170

Waste Btu Content Outside Design Range. The parties acknowledge that the Throughput Performance Liquidated Damages and the Annual Electricity Production Liquidated Damages have been established based on the assumption that the Processible Waste processed by the Facility will have a Btu content within an allowable range of 4,500 to 6,500 Btu per pound on an annual average basis throughout the Term of this Service Contract. If with respect to any Billing Period or Contract Year Throughput Performance Liquidated Damages or Electricity Production Liquidated Damages are payable pursuant to Section 15.9 or Section 15.10 hereof, the Company may certify in a written report to the Authority and the Authority Engineer that the Btu content of the Processible Waste processed by the Facility in such Billing Period or Contract Year was outside the applicable allowable range and the extent, if any, to which either of such liquidated damage payment obligations is attributable to such Btu content variations. If the Authority concurs with such certification or fails to respond within 30 days of such certification, the Throughput Performance Liquidated Damages or Annual Electricity Production Liquidated Damages which otherwise would have been payable pursuant to Section 15.9 or 15.10 hereof shall be adjusted appropriately to reflect the effect of the Btu variation. If the Authority does not so concur, it shall notify the Company within such 30-day period and shall describe in reasonable detail the basis of the Authority’s rejection. Upon such notice of non-concurrence, thereupon either party may elect to refer the dispute to the Independent Engineer for non-binding mediation in accordance with Section 16.11 hereof.

Also, will you please provide the name of the other mismanaged trash incinerator you mentioned on WFMD?

Thank you for any explanation you can provide.

Sent 04/02/10 to Robin Davidov of Northeast Maryland Waste Disposal Authority (NMWDA); Frederick and Carroll county commissioners; and others:

Ms. Davidov,

We are still waiting for revised spreadsheets showing the KWh/ton which result from the "allowable range of 4,500 to 6,500 Btu per pound" of processable waste.

And would you please explain the difference of gross and net KWh/ton in the information you give below?

Also, would you please explain how the data in slide #22 (from a ppt by the Confederation of European WoE Plants - 1/19/10) relates to Frederick's "European" trash incinerator?

However, I would still like to point out that whatever European technology we are suppose to have in our facility, the contract allows for a range of heat values and it is necessary to take those values into consideration when looking at the projected income from this project.

Therefore, once again, I am asking you to run spreadsheets which use the 575 KWh/ton, 635 KWh/ton, (750 KWh/ton has already been considered in the spreadsheets you have previously provided) and 765 KWh/ton values. These are the kilowatt hours of electricity provided in Appendix 2 of the Service Contract.

Thank you.

Sent 04/12/10 to Robin Davidov, Frederick County Commissioners, and others:

Ms. Davidov, Commissioners and others:

Attached is an article from the WTOP radio website dated yesterday. Before we (the citizen's and taxpayer's) continue down the road of no return, you (the elected officials) should heed the lesson(s) learned by our nearby friends in Harrisburg, PA.

— Adamstown resident

Notable excertps from the article:

…city leaders thought they could transform their aging, debt-laden trash incinerator into a clean, efficient moneymaker. But costs exploded and massive debt payments due this year on the incinerator threaten to drag the city into bankruptcy.

Some residents wonder whether fear of a huge property tax hike to help pay down the $280-plus million in debt tied to the incinerator will spur a rash of "for-sale" signs just as the city had hoped to end a 60-year population slide.

In Harrisburg, 95 miles west of Philadelphia, the incinerator has come to symbolize city mismanagement.

It could never burn enough trash or charge enough for the service to pay off maintenance costs, critics say. Meanwhile, city officials piled tens of millions of dollars in debt onto the incinerator in the 1990s to pay for other city debts and projects and to keep it running.

Sent 05/19/10:

Good Morning Ms. Thall,

You wrote, "The Kwh/ton is guaranteed by Wheelabrator and backed by a Corporate Guarantee to pay loss energy revenues."

But actually, doesn't page 170 of the service agreement (Article XV - Service Fee and Other Payments) allow an exception to the guarantee if our trash doesn't burn hot enough? And of course we know the material with the highest BTUs is also the most recyclable. Thank you for any clarification you can provide.

Waste Btu Content Outside Design Range. The parties acknowledge that the Throughput Performance Liquidated Damages and the Annual Electricity Production Liquidated Damages have been established based on the assumption that the Processible Waste processed by the Facility will have a Btu content within an allowable range of 4,500 to 6,500 Btu per pound on an annual average basis throughout the Term of this Service Contract. If with respect to any Billing Period or Contract Year Throughput Performance Liquidated Damages or Electricity Production Liquidated Damages are payable pursuant to Section 15.9 or Section 15.10 hereof, the Company may certify in a written report to the Authority and the Authority Engineer that the Btu content of the Processible Waste processed by the Facility in such Billing Period or Contract Year was outside the applicable allowable range and the extent, if any, to which either of such liquidated damage payment obligations is attributable to such Btu content variations. If the Authority concurs with such certification or fails to respond within 30 days of such certification, the Throughput Performance Liquidated Damages or Annual Electricity Production Liquidated Damages which otherwise would have been payable pursuant to Section 15.9 or 15.10 hereof shall be adjusted appropriately to reflect the effect of the Btu variation. If the Authority does not so concur, it shall notify the Company within such 30-day period and shall describe in reasonable detail the basis of the Authority’s rejection. Upon such notice of non-concurrence, thereupon either party may elect to refer the dispute to the Independent Engineer for non-binding mediation in accordance with Section 16.11 hereof.

Sent 05/19/10 by Linda Thall, CC: John Mathias, county attorneys:

My sole role in this matter is to assist in the County’s responses to Public Information Act requests. Your question should be directed to those who are more directly involved in this substantive area.

Sent05/20/10:

Mr. Mathias,

Could you please clarify this "guarantee"?

Thank you.

Sent 05/24/10 to Frederick County and Carroll County commissioners and Frederick County attorneys:

Hello Mr. Mathias,

Would you please clarify what the service contract specifies about the electricity "guarantee"? It appears Wheelabrator has given itself an "out" from this obligation. (Please see below.)

Thank you.

Sent 06/17/10:

Well, Ms. Thall,

Mr. Mathias is not helping explain the supposed electricity revenue guarantee.

Here is the reality. If we remove the recyclable paper from being used as incinerator fuel (which last week we heard is really important for the Mont. Co. trash incinerator to burn), and if we compost the paper which can't be recycled, and if we remove the plastics with their high BTUs then what material is going to be left to burn in order to stay within the "allowable range of 4,500 to 6,500 Btu per pound"?

Will you agree the energy revenues are really not guaranteed once you read the "Waste Btu Content Outside Design Range" section in the service contract?

I understand you have said your role is to assist with Public Information Requests, but you did make a definitive statement about the "Corporate Guarantee" to pay lost energy revenue and I think we should all be on the same page in understanding this piece of the puzzle.

Thank you for any clarity you can bring.

Wheelabrator Falls hasn't yet reached 720 kwh/ton?

Sent 06/24/10 to Chris Skaggs, NMWDA:

Mr. Skaggs,

On June 9, 2010 you explained to a group of us that the Wheelabrator Falls facility north of Philadelphia reached 720 kwh/ton. However, in a document I received from Comm. Blaine Young it states, "If the Falls facility had processed 5500 BTU/lb of waste, the facility would have produced 720 kwh/ton." (Emphasis added.)

So what is the highest kwh/ton this example facility has achieved?

On March 6th on the Pattee Brown show Ms. Davidov said she would be "happy" to plug-in different assumptions in the spreadsheets, but she has not done so.

To start, many of us think it's important to evaluate the difference in the anticipated electricity revenue if the mega-spreadsheets are amended to show the 575KWh/ton, and 635 KWh/ton values as anticipated within Appendix 2 of the Service Contract. Can you please update these spreadsheets to reflect these range of values?

Frederick Carroll Regional Energy Recovery Facility
6397 KB, Last Uploaded: 2/9/2009 3:00:02 PM
Conservative Electric Fuel Cost Escalation
Frederick Carroll Regional Energy Recovery Facility
6474 KB, Last Uploaded: 7/20/2009 12:35:41 PM
Conservative Electric Fuel Cost with a 25 percent One Time Increase

BTW, we're still looking forward to seeing the final Compare Doc and the fully executed Service Agreement. I understand Ms. Coble is working on providing this information.

Thank you.

And I thought this was "proven" technology?

Sent 06/30/10 to Chris Skaggs, NMWDA:

Mr. Skaggs,

On June 9, 2010 why did you tell us a trash incinerator in Pa. has reached 720 kwh/ton when it has not? In an email from Ms. Davidov dated 3/18/10 she provided a chart which shows the Millbury incinerator hit a high of 702 kwh/ton. Ms. Davidov states,

"Below is a chart of actual performance at four operating plants on the East coast. As you can see, the range of net kwh/ton is 611-702 over a period of 5 years."

So, no facility that you know of has ever hit the 750 kwh/ton which is the basis for the electricity revenue you claim we will make.

AGAIN - When will spreadsheets be provided which show the range of heat values as anticipated per the contract?

And where is the final, fully executed service contract between NMWDA and Wheelabrator? I've been asking for it to be posted on the County website for over 2 months. Will it take another Md. Public Information Request in order to obtain this document?

Gross and Net Kwh/ton from 2005 through 2009

		Gross Kwh/ton	Net Kwh/ton
Bridgeport	12/31/2005	714	640
	12/31/2006	732	663
2250 tpd	12/31/2007	749	678
	12/31/2008	741	665
	12/31/2009	701	636
Falls	12/31/2005	774	686
	12/31/2006	773	687
1500 tpd	12/31/2007	763	682
	12/31/2008	752	669
	12/31/2009	721	639
Lisbon	12/31/2005	716	611
	12/31/2006	710	594
500 tpd	12/31/2007	682	591
	12/31/2008	703	610
	12/31/2009	684	600
Millbury	12/31/2005	779	698
	12/31/2006	768	690
1500 tpd	12/31/2007	785	702
	12/31/2008	744	666
	12/31/2009	719	648

Your cooperation would be appreciated.

The final service contract, please

Sent 06/15/10 to Chris Skaggs, NMWDA; J. Michael Evans, Carroll County; Mike Marschner, Frederick County Division of Solid Waste

Mr. Skaggs - It occurred to me that if the Operating Fee #1 was corrected back to $19.2M per year, then what is titled "Revised Final Contract of June 30,2009" (Service Contract (1-26-09 compared to 7-2-09) is not actually the final draft of the service contract.

Therefore, could we please get the final redline posted on the County websites as well as the fully executed contract?

Also, could I please have an answer about using urea rather than anhydrous ammonia for your facility in Frederick?

Comm. Zimmer, we're still smarter than that

Sent 06/10/10:

Comm[issioner Michael] Zimmer,

You're attempting the same trick Ms. Davidov tried — throw the ball the other way hoping we will chase it.

You found an article from a politician who feels the same way you do, and we're all suppose to forget about the facts of what you want to impose upon the citizens here?

Here's some interesting information we received from Chris Skaggs, Deputy Director of the NMWDA. There are NO INCINERATORS which currently generate 750 KWh/ton of electricity. The current highest amount generated is 720 KWh/ton in a facility in Pennsylvania. But they "hope" to get there with the one the NMWDA wants to own in Frederick. (I'm including several people here who heard this also.)

Do you realize that all of the financial projects upon which you are relying are using this UNPROVEN 750KWh/ton number? A fiscally sound evaluation of the projected income should compare the range of values as given in the contract, and those which are based upon proven situations.

And since some politicians have somehow have fallen into the "jump off the bridge because Johnny did it" mentality, I will share with you part of an email I received from Europe, "... Holland - a traditional burning country- has a moratorium on new incinerators until 2020 and both Germany and Danemark have over-capacity and are already importing waste to burn."

And we all know the Fairfax trash incinerator has a shortage of waste to burn.

And yesterday we were told the Mont. Co. facility is year-to-date only burning at 68% capacity.

So, from where do you think all of this waste is going to come for us to burn?

Also, the article you sent makes no mention of the cost of incineration upon Vancouver.

Looking at our own documents and the situation here might be of more use then trolling for newspaper articles from elsewhere. Oh wait, you got this article from our very own NMWDA's website. Another example of Ms. Davidov's biased support of incineration. (Who has paid for her trips to promote incineration?)

Thank you.

PS - Thank you Mr. Mathias for clarifying it was an attorney in Frederick County who is in private practice who gave his opinion about Ms. Davidov's conflict of interest. Also, when will you have time to review the service contract about the electricity revenue guarantee? I certainly would appreciate your opinion about the paragraph which "undoes" any kind of guarantee of the electricity revenue.

Sent 07/02/10:

http://www.youtube.com/watch?v=-fSg5JqWR0I

*** Please note this correction for the email [above]: We now know that 702 kwh/ton is actually the highest heat value obtained. Therefore based upon "proven technology" the projected electricity revenue is not assured.

Ms. Davidov, you're drooling for that $500K per year

Sent 04/12/10 to Robin Davidov of Northeast Maryland Waste Disposal Authority (NMWDA); Frederick and Carroll county commissioners; and others:

Ms. Davidov,

On Pattee Brown's show on WFMD (Hour #2 - start at 21:10) you said you would "be happy" to run the assumptions as requested.

Therefore, will you please forward the spreadsheets which show the correct annual operating fee of $19,878,455, and the 575K Wh/ton, 635 KWh/ton and 765 KWh/ton values as provided within the Service Contract?

Thank you.

Sent 04/13/10 to Robin Davidov of Northeast Maryland Waste Disposal Authority (NMWDA):

Ms. Davidov,

You still have not provided the name (and the proof) of a SINGLE trash incinerator in this world which achieves 750KWh per ton as used into your mega-spreadsheets. Is there even one in Europe which reaches this standard on an annual basis? Any if so, is this output consistent? And since our contract allows for variations in the KW/h, where are the spreadsheets showing the variantes, please?

And in response to your forwarding of the article titled "Europe Finds Clean Energy in Trash, but U.S. Lags Behind" I give you here some additional information:

Jan Verheyen of OVAM, the Flemish Public Waste Agency, said: 'There is no point implementing a landfill ban on its own. It needs to be used in conjunction with an incineration ban so that the waste hierarchy gets respected.'

Officials from Germany and Sweden echo this view. 'Perhaps Sweden has gone too far down the incineration route and is not recovering enough materials by recycling,' said Catarina Ostlund of the Swedish Environmental Protection Agency.

Ms. Davidov, it seems clear enough why you are motivated to place your regional incinerator in Frederick. Your agency owns the facility, but has none of the responsibility of the daily operations and none of the financial risk. But the NMWDA still collects a 1/2 million dollar annual payment for the next 30 years!

The benefit to the NMWDA in having this facility built should have been revealed early in procurement process. In the PowerPoints presented to the citizens of this county I did not see mention of the payments your agency receives from the incinerator operator.

Also sent to Robin Davidov:

Robin,

Motivations aside, I'm at a loss as to why the Northeast Maryland Waste Disposal Authority continues to refuse to provide the spreadsheets that others and I have repeatedly asked you to provide in formats that facilitate research, analysis and public understanding.

It looks as if you are averse to transparency and the public's right to have an informed say.

Please don't don't reiterate that the Office of the Attorney believes that you have met the letter of the Maryland Information Act. Instead, please honor the spirit and intent of the Act, which are to enhance transparency and informed public participation.

Please send those public records in the requested formats as soon as possible.

Ms. Davidov won't share the spreadsheets, but it's not her money!

Sent 06/07/10 to Carroll County Commissioner Michael Zimmer and Maryland state senators:

Comm. Zimmer,

It looks like Ms. Davidov won't give you those spreadsheets either. Not surprising.

However, since you have a fiduciary responsibility to your constituents, do you not think it appropriate (even necessary) to require Ms. Davidov to provide spreadsheets which show the various KWH/ton values?

This is crucial since all of the pro-burning commissioners seem to be relying on a certain amount of electricity income. Yet, Ms. Davidov refuses (please see the previous emails) to provide the financial scenarios which show the allowable range of BTUs per the contract.

Yes, the NMWDA will be collecting even more than just $500K per year

Sent 04/29/10 to Frederick and Carroll County commissioner candidates, Frederick County commissioners, Carroll County commissioners, and others:

And for those of you who have wondered if the $500M per year is the only money sent to the NMWDA, the answer is "No".

Pursuant to the Counties' contracts with the NMWDA, Frederick and Carroll Counties will be charged for the following "administrative" costs.

Page 13:

[NMWDA] Administrative Costs. [NMWDA] Administrative Costs is an amount equal to all reasonable administrative costs of the [NMWDA], other than Variable Costs, attributable to the administration and enforcement by the [NMWDA] of its obligations under this Agreement, including, but not limited to, the following: accounting, legal, engineering and other professional fees, including the fees of the Consulting Engineer required to be retained by the [NMWDA] pursuant to the Service Agreement or this Agreement, the Independent Public Accountant, the Insurance Consultant; any fees, expenses or liabilities required to be paid by the [NMWDA] to any trustee, paying agent or fiduciary for the Bonds; and expenses related to the issuance of the Bonds.

For Mont. Co. this amount averaged one million dollars per year for fiscal '03-'08.

Sent 04/30/10:

"It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong."

—Thomas Sowell

The NMWDA has no responsibility for the daily operations of their trash incinerator in Frederick, and ALL of the financial risk rests on the backs of the property owners in Frederick and Carroll Counties.

The NMWDA gets to collect its annual membership fees from each County ($40K last year from Frederick Co. alone), all administrative costs (which are grossly underestimated in the mega-spreadsheets) AND ~$500K per year free & clear in payments from Wheelabrator.

Why shouldn't the NMWDA want its regional incinerator wherever it can get it?

$740K spent already — prior to the incinerator location being secured!

Sent 03/24/10 to County Manager Ron Hart; the Frederick County Board of County Commissioners; and Mike Marschner, director of the Frederick County Division of Utilities & Solid Waste:

Since Jan. 28th I have been asking for the total amount billed to the County since it allowed the NMWDA to sign the contract with Wheelabrator to build and operate the NMWDA's Regional Trash Incinerator to be located in Frederick County.

I appreciate you saying you'll provide "expenditures to date", but I do not understand why no one has yet provided the 6-7 monthly statements the County has received from the NMWDA since execution of the relevant contracts.

I also find it troubling that this information is not available to Commissioner Hagen.

Therefore, to be assured the residents of this County are privy to the expenditures to which this Board of County Commissioners has agreed, attached here please find my Maryland Public Information Act request for the documents as stated within.

Sent 03/24/10 from Mike Marschner to County Manager Ron Hart and the Frederick County Board of County Commissioners:

Ronnie and Commissioners:

Attached please find Wheelabrator's costs to date related to the WTE project.

Please note that these costs only reflect what has been spent to date (March 12) but it should be noted that if the contract is cancelled that there may be other costs that are committed to beyond the "expenditures to date".

The total cost of permitting and engineering will exceed the $3.0 million up to cap that Frederick County and Carroll County are obligated to pay if the project is cancelled so risk rests with others as well.

I received this information from Wheelabrator last Friday and did not get a chance to send it out until today.

The above email was forwarded with attachment from Jan Gardner, county commissioners president, to several Frederick County residents on 03/24/10:

Please see attached. I believe this information should satisfy for your request including your PIA request. If not, please advise.

I would note again, that the "expenditures to date" are just that and do not necessarily represent all financial commitments that might be obligated.

Regards,

Jan Gardner

Reply on 03/24/10 from Frederick County resident:

Wheelabrator is soaking Frederick and Carroll Counties for all it can get — $739,549.00 in just THREE MONTHS!

I cannot restrain myself — I have to say I AM APPALLED AT THIS FISCAL IRRESPONSIBILITY when the BoCC has not even secured the location of this facility! Commissioner Thompson has acknowledged the fact that the next Board may be wise enough to stop this nonsense, but no one is taking this fact into consideration.

Thank you for providing this information, but no, this does not satisfy my Md. PIA — I would still like to review the monthly statements as requested. I am sick, absolutely sick at the wastefulness of this BoCC in these difficult economic times.

Reply from Bill Carlin, CEO, Reverb Networks Inc.

Amazing. I need to get out of technology and into waste management. Reverb can't get paid for services it can't or hasn't actually rendered. This is amazing given all of the budget issues we are dealing with elsewhere and these guys have a blank check for up to to 3 million.

Blaine, where are you? I can't imagine you would let this pass uncommented.

We can do better.

Another $26,000,000.00 to Wheelabrator?

Sent 03/09/10 to Frederick and Carroll county commissioners; Frederick County Manager Ron Hart; and Mike Marschner, director of Frederick County’s solid waste division:

Commissioners,

I would like to know if you will be answering this question, "Could you please explain why we gave away a free deflation flooring option as well as $26,349,973 of construction savings before even leaving the gates for this project?" Frederick Service Contract Appendices 1-22 (1-26-09 compared to 7-1-09).pdf

Neglected costs

Sent 03/08/10 to Rick Blatchford; Frederick and Carroll county commissioners; Frederick County Manager Ron Hart; and Mike Marschner, director of Frederick County’s solid waste division:

Rick,

A year has gone by and based upon your Letter to the Editor it seems as though you've not been able to gather anymore information. From a report by the Maryland Department of the Environment here is a list of nearly 200 toxins released from the Harford trash incinerator in 2006. The State of Maryland only regulates 12.

And your math calculations still do not consider the whole financial picture. You're only looking at the $600M price tag but have neglected to consider the the Operating Fee ($19.8 per year plus an increase of 3% per year), PassThru costs (maybe $7.5M per year), the Administrative Costs to the NMWDA (maybe $1M per year), the Extraordinary Costs (Baltimore had to take out another $41M bond after its incinerator was built), and how about those Burning Bonuses to Wheelabrator? There are 19 pages of the financial obligations on the F.C. website.

This contract is essentially a blank check for Wheelabrator.

I'm glad to see other community members in Carrroll County are paying attention.

Monthly statements

Sent 01/28/10 to John Kroll, director, finance, Frederick County:

Hello Mr. Kroll,

I understand now that the contracts have been signed for the proposed incinerator the NMWDA is to be providing monthly statements. I'm curious how much has been spent since the contracts were signed on July 29, 2009. May I please have copies of these monthly statements or a summary of the itemized total to date?

Also, I see we are already getting change orders for the project, and am hoping these expenditures are reflected on the monthly statements.

Thank you for any information you can provide!

Sent 02/04/10 to John Kroll, director, finance, Frederick County:

Hello Mr. Kroll,

I checking with you to see if those monthly statements are available, please.

I also would greatly appreciate an update to the great NMWDA total expenditure spreadsheet you've previously provided.

My question is whether the amount paid as due on the monthly statements will be included on this same spreadsheet.

2/3/09 Powerpoint, pg. 24

After the signing of both [the Fred. & CC] Agreements the Authority will invoice the Counties on a once monthly basis.
The Authority will provide supporting documentation for all invoices in reasonable detail and in form and content reasonably acceptable to the County.

Sent 03/04/10 to John Kroll, director, finance, Frederick County; Frederick County Board of County Commissioners; County Manager Ron Hart; and Mike Marschner, director of Frederick County’s solid waste division:

Hello again Mr. Kroll,

Since Comm. Thompson wrote this comment this morning,

"Commissioner Gray and myself continue to support the McKinney site for the waste to energy facility. However, with the departure of Commissioner/Delegate Jenkins and the arrival of Commissioner Young, a majority of the County Commissioners are opposed to the McKinney site. If there is going to be a volte face on waste to energy, it will be far less costly if it happens sooner rather than later;"

Pursuant to Section 4.2 of the contract between the NMWDA and the County, " For each Billing Period, the NEA shall render a statement (a “Billing Statement”) to the County setting forth the County’s Energy Recovery Fee and any other amounts due under this Agreement for the Billing Period."

So again please, I am again asking for the total amount paid to date since the contract for the NMWDA's trash incinerator was executed last summer.

Thank you for your anticipated assistance.

Additional costs

Sent 02/23/10 to Frederick Board of County Commissioners; County Manager Ron Hart; and Mike Marschner, director of Frederick County’s solid waste division:

In several places I've read, "The [NMWDA] will, at the direction of Frederick County, modify the County’s transfer station in order to allow the transfer station to operate as a materials recovery facility (MRF) or develop a new MRF. The costs for the MRF will be borne by Frederick County..." (Please see the top of page 5 in the MOU attached here.)

How much will it cost Frederick County to turn the new transfer station into a material recovery facility? And why do so?

If we want a "regional" solution then why not use our state-of-the-art transfer station to encourage places like Wash. Co. to bring it's recyclables to us for ~$25/ton. Then we ship them to Elkridge for ~$10.50/ton.

Is there money to be made by operating a regional transfer station?

I really would like an answer if this business model has been explored. It's not addressed in the Beck or the RTI reports.

Bankruptcy is inevitable

Sent 02/21/10 to Frederick and Carroll county commissioners:

"'Bankruptcy is inevitable,' Mr. Miller says. 'We are in a terrible bind.' A budget passed Saturday by Harrisburg's city council didn't include any funds to cover the debt payments, according to the city clerk's office." [re: Harrisburg, where, a March 1 deadline is looming on a payment of $2 million out of the $68 million due this year for the financing of an incinerator plant.—see Muni Threat: Cities Weigh Chapter 9 and Dauphin County says it won't pay Harrisburg's share of incinerator debt]

Commissioners,

Or maybe bankruptcy won't be an issue for Frederick and Carroll Counties since when there's a shortfall in electricity revenue and landfill tipping fees the revenue bonds for the NMWDA's trash incinerator will be secured by the Service Benefit Charge each and every property owner will find on their property tax bill.

Is that the safety net you're counting on?

NMWDA compensated by Wheelabrator!

Sent to Robin Davidov of Northeast Maryland Waste Disposal Authority (NMWDA), Frederick Board of County Commissioners and Carroll County Board of County Commissioners:

In addition to the amounts your agency collects directly from each county for NMWDA's Regional Trash Incinerator which is planned for Frederick, I see that your agency is compensated by Wheelabrator:

(page 174) SECTION 15.19. MANAGEMENT AND ADMINISTRATION CONTRIBUTION. The Authority is a multi-county agency and an instrumentality of the State. It receives no State funds to support its overhead or operations. The Authority will own the Facility. In order to provide funds to provide Authority staff, overhead and operations for the purpose of managing the project, fulfilling fiduciary requirements of the bonds, maintaining accounts and records, enforcing contract provisions, the Company will pay to the Authority an amount equal to Three Hundred Twenty-Seven Dollars and Fourteen Cents $327.14 per installed Ton per year in 2008 dollars, which amount shall be adjusted by the Operation Fee Adjustment Factor from the BAFO Date (the “Management and Administration Contribution”).

Considering the Operating Fee jumped from $19,211,455 to $19,878,455 per year (a $667K increase), is there any reason why you would not provide a spreadsheet which would show the calculation of expenses which are covered by the annual Operating Fee?

The $20,000,000 per year Operating Fee which Frederick and Carroll Counties will be paying must be based upon something, isn't it?

What's NMWDA's total piece of the pie?

Sent 04/08/10 to Frederick and Carroll county commissioners, commissioner candidates and others:

Commissioners, have any of you pulled out your calculator?

Since the NMWDA gets $327.14 per year per installed ton (1500, correct?) from Wheelabrator, then that is a payment of $490,710.00 the first year of operation. And these kickbacks (er, I mean payments) increase 3% per year.

Here's the summary:

The NMWDA owns the facility.
The NNMWDA carries none of the financial risk. (That is solely the responsibility of Frederick and Carroll Counties.)
The NMWDA has no responsibility for the daily operations. (For $20M/yr. Wheelabrator operates the facility and charges for all additional maintenance, upgrades, "extraordinary expenses", retrofits, etc.)
The NMWDA gets about half of a million dollars per year to deposit into their coffers.

Do we wonder why the NMWDA thinks its incinerator is a good solution for Frederick and Carroll Counties? For the citizens, or for the NMWDA?

No guarantees

Sent to Chris Skaggs and Robin Davidov of NMWDA:

As you can read here, Mr. O'Connell asked the incinerator industry to guarantee their claims. Why are there no guarantees in the numbers and figures the NMWDA provides for our community? Why is that the contracts for Frederick and Carroll counties are the equivalent of writing a blank check? Again, Mr. Skaggs, why would you not answer audience questions about the contracts if this facility is the best choice for Frederick citizens Any clarity to your lack of "response to our local concerns" would be appreciated.

Why the $667K+ raise for Wheelabrator — already? / Service agreement question‏

Sent 08/24/09 to Mike Marschner, director of the Frederick County Division of Utilities & Solid Waste, and Carroll County Commissioner J. Michael Evans:

Mr. Marschner & Mr. Evans,

Would you be so kind as to please explain the increase in Wheelabrator's Base Operation Fee from a starting point of $19,211,455/yr. to $19,878,455/yr. in the final contract?*

*Please scroll to page 171 (ARTICLE XV SERVICE FEE AND OTHER PAYMENTS)

Service Contract (1-26-09 compared to 7-2-09) 1304 KB, Last Uploaded: 7/2/2009 4:32:25 PM

And since this fee escalates at 3% per year ("Operation Fee Adjustment Factor"), how does this change the calculations on slides #128-130** which show Frederick County's portion of the Base Operation Fee go from $17,613,000.00/year to $33,055,000.00/yr. in 20 years?

Updated calculations would be appreciated.

Thank you.

Memorandum of Understanding

Reply 09/02/09 from Robin Davidov of the Northeast Maryland Waste Disposal Authority (NMWDA):

Ms. _____: I understand that you have a question about the annual operations and management (O&M) fee in the Service Agreement . The $667,000 is the anticipated annual cost for certain insurance for the facility. This amount was initially included in Wheelabrator’s scope of services. However, upon further study, the Authority was advised to remove the insurance premium cost from the fixed O&M price, and include this cost as a pass through cost. Insurance premium costs increase and decrease from year to year and are not predictable over a long term. These costs are outside of Wheelabrator’s control, as they are set by the insurance carriers. Paying for insurance premiums as a pass through costs will result in less expense to the County than if Wheelabrator had to estimate this cost over a twenty year period, and include that estimate in the Guaranteed O&M price. The Service Agreement will show that the annual O&M price does not include the cost of insurance premiums.

The financial projections presented to the Board of County Commissioners were correct. I have confirmed that certain insurance premium costs and the annual O&M fee were correctly counted.

Regards, Robin

Robin B. Davidov
Executive Director
Northeast Maryland Waste Disposal Authority
100 South Charles Street, Tower II, Suite 402
Baltimore, Maryland 21201-2705
410.333.2730
www.nmwda.org www.mdrecycles.org

Sent 01/29/10 to Mike Marschner, director of the Frederick County Division of Utilities & Solid Waste; Carroll County Commissioner J. Michael Evans; Frederick County Commissioners; and others:

Mr. Marschner and Mr. Evans,

I rec'd an email from Ms. David explaining that the increase in the annual service fee increased by $667,000 because the annual cost of insurance was removed from the fixed price and will be considered a pass through cost.

Do you have any idea what she is talking about since in the contract there were no changes to Section 15.5 (1) regarding the insurance and secondly, if something is removed as a cost then the fee should go down not up.

So again please, why the $667,000 per year (plus the annual 3%) increase?

Also, Mr. Evans, it was very nice of you to go to the Waste Not! Carroll meeting the other evening to give a brief overview of the situation.

Below is Ms. Davidov's email to me if you can please help me understand.

Thank you.

Sent 03/30/10 to Frederick and Carroll county commissioners; Mike Marschner, director of the Frederick County Division of Utilities & Solid Waste; and Robin Davidov:

Commissioners, for months I've been asking why there was a $677,000 PER YEAR increase in Operating Fee#1. No sensible answer has been provided.

Since this "raise" for Wheelabrator is approximately an additional $18 Million in the first 20 years of operation, will you at least require Robin Davidov (the Executive Director of the NMWDA) to correct cell F17 to reflect this additional cost? Or even better, how about having Ms. Davidov provide the working Excel spreadsheet so the assumptions can be tested?

Conservative Electric Fuel Cost Escalation (approx. 6 MB file)
Conservative Electric Fuel Cost with a 25% One-Time Increase (approx. 6 MB file)

Since we know that according to the forecasts given by Ms. Davidov project that long-hauling our waste is the least expensive option for the first 12 years, we should see how this unexplained increase in costs affects the long-term projections.

Thank you.

Sent 01/05/10 to County Commissioner Jenkins and the rest of the Frederick Board of County Commissioners, Maryland state senator and others:

You may not be concerned about the public health, environmental, hallowed ground, traffic congestion and outdated technology arguments, but for anyone who has been attentive to this issue the "fiscally responsible argument" is one of the strongest reasons against siting a trash incinerator in Frederick County. Have you read the contract which you voted to sign?

Within months of receiving the proposal for the trash incinerator for Frederick County the annual operating cost rose from $19,211,455.00 to $19,878,455.00, a bump of $667,000. And this operating fee will increase by 3%/year for the life of the contract. (Money which goes to N.H. instead of staying in the local economy.) And of course the "passthrough costs" of the contract are essentially the same as signing a blank check to the NMWDA and Wheelabrator.

Even in the biased Beck Report it states the cost of long-hauling "follows closely" to the cost of a trash incineration, and that was based upon the assumptions of increased population and the resulting increase in trash generation. Trash generation has decreased, not increased.

If you are concerned about reducing the annual cost of long-hauling our trash out of state, then I hope you will go back and please review my emails titled "What's our trash diet?" and look to implement some of the strategies suggested in order to save this County millions of dollars every year.

Financial obligations

Could Frederick County be obligated for $3 million instead of $1.5 million prior to the financing if there are problems that would prevent Frederick from being the regional trash host (such as lawsuits, wetland issues, health impact study, air quality issues, problems with the FAA, etc.)?

In the original memorandum of understanding (MOU) between Frederick and Carroll counties, it stated Frederick's maximum obligation if the contract was cancelled was $1.5M:

"Should the Counties elect not to go forward with the Project prior to financing, the [Authority] will stop work on the Project, and the Counties will reimburse the [Authority] for actual design, engineering and permitting work performed by the [Authority] but each County's obligation will not exceed $1.5 million."

Now the MOU it states....

"Should the both Counties elect not to go forward with the Project prior to financing, the [Authority] will stop work on the Project, and the Counties will reimburse the [Authority] for actual design, engineering and permitting work performed by the [Authority] but each County’s obligation will not exceed $1.5 million. Should Frederick County elect not to go forward with the Project, before Carroll County elects not to go forward with the Project, Frederick Country will be responsible for reimbursing the project costs. If Carroll County elects not to go forward, and Frederick County cannot find a substitute equity partner, Carroll County shall pay the project costs."

And from page 50 of the Service Agreement with Wheelabrator:

Convenience Termination Option Prior to Construction Commencement Date. The Authority shall have the right any time prior to the Construction Commencement Date, exercisable in its sole discretion for any reason upon seven days’ written notice to the Company, to terminate this Service Contract. Upon any such termination, the Authority shall reimburse the Company for 100% of its Cost Substantiated costs incurred directly to third parties from the Contract Date to the Termination Date hereunder, which are directly related to the performance of the Company’s obligations, and which are necessary to be performed prior to the Construction Commencement Date, and, except as set forth in subsection 5.3(E), subject to a maximum amount of Three Million Dollars ($3,000,000.00) (Discussion Regarding WTE (Jan. 29, 2009).)

Comparing costs of incineration with alternatives

How can someone justify comparing the costs of the capital investment, collection, transportation and "disposal" of single-stream recyclables in Frederick county with only the disposal of trash, so that they can state that recycling is more expensive than wasting?

Sent 02/05/10 to Chris Skaggs, Robin Davidov and Cathy Coble of NMWDA; Frederick and Carroll county commissioners; Mike Marschner, director of the Frederick County Division of Utilities & Solid Waste; County Manager Ron Hart; and Josh L. Russin, Western Maryland Coordinator, Intergovernmental Affairs

Say what you will about the environmental issues, but this is an example of the current economic dilemma for many municipalities and counties who are committed to debt service and/or debt guarantees for for local incineration programs.

I live in Frederick and am a serial technology entrepreneur. As a business case, I can’t imagine the Wheelabrator deal making sense for Frederick compared to a new landfill at worst or some hybrid of Pay as You Throw, Recycling and continued tipping elsewhere.

All the best, Bill

From PennLive.com today: Dauphin County says it won't pay Harrisburg's share of incinerator debt

Bill Carlin
President and CEO
ReVerb Networks Inc.

Our landfil, our rules

Sent 05/05/10 to Maryland state senators:

Frederick County members of the General Assembly,

Thank you for your support of a pilot Save-As-You-Throw program for Frederick County. I did want to share with you an email I sent to the participants in the last Solid Waste Advisory Committee meeting.

This information was discussed over 1-1/2 years ago, so I hope now our BoCC will move forward with the appropriate rules to increase waste diversion and to encourage and support our local haulers. I believe this would be preferable to executing exclusive contracts with the large out-of-area haulers.

We all need to support local business, and to find cost effect ways of operating business and government operations.

Sent 04/09/10:

Please see the attached for reference to the discussion at the Wednesday night SWAC meeting regarding Frederick County's ownership of its landfill.

Taken from an email from John Mathias:

The BOCC may impose conditions on a hauler’s use of a County facility (such as the County’s sanitary landfill or transfer station) but these conditions would not apply if the hauler chose not to use the County’s facilities.

The BOCC is provided authority in state law to prescribe rules for the use of County solid waste facilities. (Article 25, Section 14A (a) (1). ) These rules could require that only haulers providing certain services (e.g. curbside recycling, bulk pickup) to its customers would be licensed to use the County facilities. These rules would only apply to those haulers using the County facilities.

Again, I encourage the County to get out of the recycling business and to allow the local haulers to have the opportunity to expand their businesses to include recycling services. The County may require all haulers using its landfill to provide these services in a tiered pricing system.

Would there be a cost benefit for the County to encourage recyclables to be tipped since it charges $25 ton for recyclables and I've read that it costs ~$10.50/ton to transport these materials to the Elkridge Materials Recovery Center?

Questions and Concerns About the Frederick County Incinerator

These incinerator concerns have been sent to officials, politicians and candidates in Frederick County, Carroll County and the State of Maryland; the Northeast Maryland Waste Disposal Authority, and others.

Costs

Kirby Delauter doesn't think the incinerator is going to cost Frederick anything!

Sent 08/29/10:

Incinerator Finances

Sent 07/08/10 by Carroll County resident to Frederick County Board of County Commissioners:

Sent 07/09/10 by Frederick County resident:

Response from Frederick County Commissioners President Jan Gardner, sent 07/10/10:

Follow-up sent 07/11/10:

Reply by Jan Gardner 07/11/10:

Also sent to Jan Gardner, 07/11/10:

Reply by Jan Gardner:

Incinerator Finances — the cap really isn't $3M [continued from above]

Sent 07/12/10:

Response from Jan Gardner, 07/12/10:

Sent 07/12/10 to Jan Gardner:

Reply from Jan Gardner, 07/12/10:

Sent to Jan Gardner 07/12/10:

Reply from Jan Gardner:

Incinerator Finances — what breach of contract? [continued from above]

Sent 07/27/10 to Jan Gardner:

Sent 07/27/10 to Jan Gardner:

Sent 08/19/10 to Jan Gardner:

More from Marion County, Oregon

Sent 07/05/10:

CONTINUED RELIANCE ON INCINERATION IS AN ECONOMIC THREAT

THE HEALTH IMPAIRING EFFECTS OF INCINERATORS AND INCINERATOR ASH

WAYS IN WHICH REGULATIONS (AND CLAIMS) CAN BE INADEQUATE, INCOMPLETE, MISLEADING

Money "sloshing around" — the winners and losers

Sent 06/25/10:

Snt 03/06/09:

Sent 03/02/09:

Sent 02/09:

Sent 02/25/09:

Sent 02/24/09:

Sent 02/09:

Sent 02/24/09:

Sent 02/24/09 to Jan Gardner:

Reply from Jan Gardner, 02/24/09 Subject: Wheelabrator Announces LTE Plant Win

Incinerator revenue bonds

Sent 07/13/10:

Incinerator — Problems with financial analysis

Sent 07/14/10 to Carroll County Commissioner Mike Zimmer:

From the Frederick News Post forum

Sent 08/13/10:

Response by Caroline Eader:

A Vision of Frederick County's Future? Incinerator = bankruptcy or just higher SBCs?

Sent 05/12/10:

Special report: The incinerator that may burn muni investors

Wheelabrator Frederick Project Operation Fee

Sent 04/12/10 to Robin Davidov, executive director, Northeast Maryland Waste Disposal Authority:

Harvey, you're wrong again

Sent 05/29/10 to Harvey Alter and others:

Harford's tra$h incinerator

Sent 06/04/10:

Sent 05/28/10 by Carroll County Commissioner Michael Zimmer:

Turning Trash into Money (Harford County Incinerator)

Sent 04/21/10 to Robert B. Cooper, P.E, director of Public Works, Harford County:

Sent 04/22/10:

Sent 03/29/10 by Carroll County Commissioner Michael Zimmer:

Sent 04/26/10 from Carroll County Commissioner Michael Zimmer:

Sent04/26/10 to Carroll County Commissioner Mike Zimmer; Frederick County Commissioners; Mike Marschner; Ron Hart, county manager; and others:

Fairfax doesn't have enough trash for its incinerator

Sent 05/16/10:

D.C.'s trash is now Fairfax facility's treasured commodity

Jan, where is that open and transparent government?

Sent 06/11/10 to Jan Gardner, Frederick County commissioner president; Frederick and Carroll county commissioners; and Linda Thall, senior assistant county attorney; and others:

Sent 06/07/10 to Jan Gardner, Frederick County commissioner president; and Linda Thall, senior assistant county attorney:

Sent 05/24/10 to Frederick and Carroll county commissioners:

Sent 04/05/10 to Frederick County Commissioners, Carroll County Commissioners, commissioner candidates and others:

Jan, please correct your misstatement of the "penalty"

Sent 03/13/10 to Jan Gardner:

Some people have not been getting the truth correct

Sent 05/17/10:

"Touchy-feely" in Billions of Dollars

Sent 03/11/10 to Harvey Alter, Frederick County Solid Waste Advisory Committee:

Commissioners, please stop bleeding $$$$$

Sent 03/29/10:

The electricity guarantee isn't really guaranteed.

Reply from Jan Gardner, 02/24/09
Subject: Wheelabrator Announces LTE Plant Win