For immediate release - Oct. 27, 2004
TAVARES — The Lake County Board of County Commissioners approved Tuesday, Oct. 26, a settlement deal with owners of the Okahumpka waste incinerator that ends fours years of litigation and will save taxpayers an estimated $26 million over the next 10 years.
Some savings from the settlement are already reaching the citizens of Lake County as the Board of County Commissioners recently approved the reduction of the countywide ad valorem tax by 10 cents per $1,000 of property value. Commissioners noted future savings could also be on the way as refinancing debt for the incinerator is explored and cost reductions from the settlement materialize. Refinancing of debt could save the County as much as $1.5 million annually.
The County settlement with Covanta Energy focuses on four areas of importance: review of capacity, changes in law, ash removal and cost of operations.
The original agreement minimized the County’s involvement in the waste capacity of the facility. The Board-approved settlement gives the County full responsibility of the incinerator’s waste capacity. In the previous contract, the County guaranteed only 130,000 tons of solid waste to the incinerator a year. The settlement raises that mark to more than 160,000 tons of solid waste annually with an estimated expenditure savings of about $675,000.
Another significant change outlined in the settlement is the County is allowed to participate in reviewing proposed upgrades and new features to the facility. Previously, changes in pollution laws that caused for significant upgrades to the incinerator were not discussed between the two parties. The settlement also supplies a more effective dispute-resolution process that calls for a series of mediation and arbitration meetings before the parties enter into litigation.
In the previous contract, if Covanta Energy could find an alternate method of ash disposal, the County would have to pay an estimated $1.1 million annually. Finding an alternative is now the County’s responsibility and no fee will have to be paid.
The final significant piece of the settlement is it gives the County ability to jointly oversee the operation and maintenance costs of the facility. By implementing a service coordinator to manage the contract, the County will save an estimated $225,000 annually. In addition, further savings are expected by reducing insurance and property tax costs for the facility.
The Okahumpka waste incinerator began commercial operation in March 1991. The Covanta Energy facility processes about 170,000 tons of solid waste per year while generating renewable energy.
The original contract for the facility was signed in 1988 by none of the current commissioners serving on the Lake County Board of County Commissioners. However, the contract has been of great concern to current Board members as costs of the operation had significantly ballooned. Without the settlement, the County would have budgeted $11.25 million this year for operation and debt payments of the incinerator.
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