FOR IMMEDIATE RELEASE: August 4, 2010

UNION COUNTY ANNOUNCES $276 MILLION TAX RELIEF
AND WASTE DISPOSAL SAVINGS PLAN

ELIZABETH---The County of Union announced it will enter into a lease extension with Covanta, the operator of the Union County Resource Recovery Facility, that once finalized, will result in at least $276 million in tax relief as well as waste disposal rate savings for all of Union County and its municipalities during the lifetime of the agreement.

“At a time when all governmental authorities are suffering from a dramatic drop in revenues, it is more important than ever that we seek to maximize an asset that has reached peak value and can help deliver tax relief to our taxpayers,” Freeholder Chairman Daniel P. Sullivan said. “This action would do that while guaranteeing that our municipalities and residents maintain low disposal rates at the Union County Resource Recovery Facility.”

Under the lease extension terms, the County and its taxpayers will realize an additional $276 million in revenues--and tax relief--over the life of the proposed contract, and there will also be an immediate rate reduction in the disposal fee from $64.44 to $61 per ton providing relief to Union County municipalities, private haulers and residents.

The Union County Board of Chosen Freeholders voted last Thursday to unanimously pass a resolution of a Memorandum of Understanding (MOU),   entering into a 20-year lease extension until 2045 with Covanta, which currently leases and operates the Union County Resource Recovery Facility (UCRRF), located in Rahway. The lease extension also gives Covanta the option extend the lease an additional five years to 2050 at the end of the term. 

The lease extension would also give Union County a 10 percent revenue share of proceeds from the sale of energy generated at the facility beginning in 2029.

As part of the MOU, the Freeholder Board also authorized representatives of the Union County Utilities Authority to begin the process of finalizing various agreements, including obtaining an approval of the extension from several State agencies.  As negotiations are ongoing, final details will be released later. 

The UCRRF currently generates electricity while disposing of all municipal solid waste generated in Union County at rates which are already among the lowest in the region.

The State originally mandated all 21 of New Jersey’s County governmental entities to build their own incinerators during the early 90s, a mandate Union County reluctantly complied with at the time.

The UCRRF, which originally began operation in 1994, has delivered significant economic value to the County.

The average cost of municipal solid waste disposal in the County in 1995 was around $120 per ton. In 2008, the average cost was only around $75 per ton. The taxpayers of the County have already realized well in excess of $100 million in savings when compared with other waste disposal options in the 16 years UCRRF has been in operation, Sullivan said.

At the UCRRF, municipal solid waste is burned at high temperatures in combustion chambers, and the heat is used to generate steam which drives a turbine to produce 45 mega watts of clean, renewable electricity enough to satisfy energy needs of 35,000 homes annually.