BIDDEFORD, Maine — Next month, the public will weigh in, and then city council will vote on whether to purchase the Maine Energy Recovery Company waste-to-energy incinerator located in Biddeford’s downtown for $6.6 million.
The sale will be paid over 20 years without interest.
Through a funding mechanism city officials developed, property taxes will not be used to pay for the purchase.
Curbside recycling and a new 10-year waste handling agreement with Maine Energy’s parent company will be part of the deal.
City council approval seems likely, said Councilor Richard Rhames.
The sale price is significantly less than the $30 million the company asked for less than 10 years ago when it first agreed to sell the facility to Biddeford, Saco and the state.
“We think we’re getting fair market value,” said Casella Waste Management spokesman Joseph Fusco. Casella, based in Burlington, Vt., is Maine Energy’s parent company.
The company is willing to sell at this juncture, he said, because waste-to-energy incineration is no longer part of its future plans.
Maine Energy is the only incinerator the company owns, said Fusco.
The company’s vision now is one of resource conservation and environmental sustainability, he said. The company’s website states that this includes recycling and bringing trash to landfills where it is used to create energy.
According to documents released by the city Thursday, in the deal that has been negotiated between Biddeford and Casella, the city would purchase the incinerator by Nov. 15.
Maine Energy would cease operations within six months of the purchase.
Within a year of the purchase, the company must demolish and pay for demolition of the facility, except for the main stack. The stack must remain to fulfill cellular contracts.
The $6.6 million purchase price to be paid over 20 years would require payments of $150,000 due Nov. 15, 2013, $200,000 due Nov. 15, 2014, and $350,000 to be paid annually from November 2015 through November 2032.
The annual payments would be covered by an estimated $145,000 in revenue from cellular provider leases, which will be transferred from Maine Energy to Biddeford, and $150,000 in revenue from the city’s Tax Increment Finance fund. That fund takes in about $500,000 each year, said City Manager John Bubier.
Another stipulation of the agreement is that the city would continue to contract with Casella, through its Maine company Pine Tree Waste Services.
The city would enter into a 10-year waste handling agreement with Casella. It would have a five-year extension option.
The trash tipping fee — the cost of disposing waste — would increase from its current rate of about $48 to $55 per ton, adjusted each year by the Consumer Price Index, or CPI.
According to the documents, Pine Tree would provide each household with one 35-gallon trash container at no cost. The city’s Department of Public Works would continue to perform curbside waste pick-up.
In addition, Biddeford would enter into a 10-year recycling collection contract with Casella, with the option of a five-year extension.
Weekly curbside recycling collection would begin July 1, 2013.
Pine Tree would provide each household a 65- or 96-gallon recycling container.
Recycling collection and disposal would cost the city $381,000 annually, adjusted by CPI each year.
Costs to the city could be defrayed by the reduced cost of trash disposal due to the anticipated increase in recycling among Biddeford residents, officials said.
Both trash and recyclable material would be brought to a transfer station in Westbrook. Design plans for the transfer station received approval from the Westbrook Planning Board earlier this month. The transfer station would be built prior to the closure of Maine Energy.
Recyclable material would be sorted and sold. The trash would be brought to the state-owned Juniper Ridge Landfill in Old Town, which is operated by Casella.
The contracts with all of the 13 Maine communities contracting with Maine Energy would continue to be honored under the agreement, said Bubier.
Before the contract can be signed, a public hearing will be held July 1.
July 17 will be the first time city council considers the agreements publicly. Public comment can be made at that time.
The final council vote is scheduled for July 31.
Prior to the finalizing the contract, the city would conduct inspections at the Maine Energy site, said Bubier.
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