Newspaper article THE JOURNAL RECORD

Council Advised to Set Policy for Waste-to-Energy Facility

Newspaper article THE JOURNAL RECORD

Council Advised to Set Policy for Waste-to-Energy Facility

Article excerpt

Council was advised Tuesday to set a policy in its negotiations with CMI Energy Conversion Systems Inc. for development of a waste-to-energy plant.

Former City Manager Terry Childers, acting as a paid consultant, urged the council at a work session to reconsider a plan to guarantee CMI's financing by tying it to the waste disposal rate structure.

"With change in law or force majeure, there will be increases in the cost of operation. The real difference here is that you are being locked into a contract that you have no way of walking away from for a period of about 20 years.

"That is of concern to me as a ratepayer because as costs begin to go up, you have no control like you would under a service arrangement," said Childers.

"Who else have we guaranteed in similar circumstances? I am not aware of any in four years. This is a major policy decision."

There needs to be a consensus of the city council to give direction to staff, said Childers, president of Childers Construction. Otherwise the council will spend a lot more time and still not arrive at a decision.

"I don't think we can get three or four people to agree on any of the options," said Mayor Ron Norick.

Three options for the CMI Energy Conversion Systems Inc.'s waste-to-energy plant were discussed Tuesday and will be on the agenda for the August 29 meeting.

The options are the same ones considered at the meeting last week:

- Maintaining the current contract.

- Modifying the current contract, which must be done before a letter of credit will be issued and CMI can break escrow to start construction. Jay Edwards, president of CMI Energy Conversion Systems Inc., proposed a 16th amendment to the contract.

- Purchasing CMI's interest in the facility.

"We offered them $3 million, which is our best estimate of the reasonable amount of value," said Jim Thompson, assistant city manager. …

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