Union County Utilities deal saves municipalities millions

Union County, New Jersey, and participating municipalities are about to see tremendous savings and direct budget relief under the terms of a deal between the Union County Utilities Authority and Covanta Energy, officials announced.

An extended lease approved by the Union County Utilities Authority will reduce its waste disposal costs and will pass on those savings to the county government and the 14 municipalities that use the authority for their communities’ waste disposal. Under the deal Covanta Energy will continue to manage its energy-generating solid waste incinerator facility here until 2031.

Because the lease deal is in effect retroactively as of January 1, 2011, municipalities will receive rebate checks for their waste disposal costs during 2011.

“We are thrilled to have been able to strike a deal that puts money immediately back into the budgets of municipalities during tough economic tough times and ensuring those continued savings into the future,” said Daniel Sullivan, acting executive director of the Union County Utilities Authority.

According to the Authority, the following municipalities will immediately be receiving direct reimbursements, Elizabeth, $658,000; Garwood, $16,000; Hillside, $101,000; Kenilworth, $30,000; Linden, $148,000; New Providence, $41,000; Plainfield, $235,000; Rahway, $158,000; Roselle, $95,000; Roselle Park, $54,000; Springfield, $67,000; Summit, $90,000; Union, 69,000; Winfield, $9,800.

The extended lease will reduce the towns’ costs by $12 per ton of waste, which will amount to a combined $100 million over the length of the lease, or $4 million per year. The authority will also provide $500,000 in solid waste grants to waste generators in the seven non-contract municipalities equating to an additional savings of $3 per ton.

That savings will go towards the municipalities’ continuing services such as fire and police departments. It will help the cash-strapped towns avoid potential layoffs and other cost-saving measures recently instituted.

Union County will see a savings of $1.5 million per year from the authority used to provide tax relief to citizens.