Fairfax is urged to buy Lorton incinerator

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Washington Post Staff Writer
Wednesday, January 26, 2011; 9:55 PM

Fairfax County Executive Anthony H. Griffin is recommending that the county buy a $418 million waste-to-energy incinerator in Lorton that it jointly operates with New Jersey-based Covanta Energy.

Griffin told reporters Wednesday that county staff conducted an analysis and think Fairfax should exercise its option to buy the plant because ownership would guarantee that its trash-hauling costs will remain low. Griffin said owning the plant will also ensure that the county would maintain control of the stream of trash that flows into the I 95 Energy Resource Recovery Center.

Otherwise, under a worst-case scenario, Fairfax might one day be shipping waste to a cheaper landfill or incinerator while trash from New York City is trucked into Lorton.

Griffin also said the purchase would not affect the county's sterling credit rating or obligate taxpayers in any way. The purchase would be financed through revenue bonds, which would be repaid solely by the fees that trash haulers pay to use the incinerator. It would not affect the county's overall ability to issue general obligation bonds - which are secured by the ability to tax residents to repay them - that are used for schools and other county investments.

If anything, buying the plant could almost double the approximately $26 million the plant receives under its current arrangement with Covanta, Griffin said.

The plant, which is the largest such facility in the Washington area, burns 3,000 tons of nonrecyclable waste a day, using steam from the process to generate electricity. The current agreement between Fairfax and Covanta expires in 2016. The county also is exploring the option of not buying the plant and extending its current agreement through 2031 - although Covanta also is pushing to give the county a smaller cut of the money received for electricity.

Supervisor Pat S. Herrity (R-Springfield) said the plant could cost $800 million including interest, and he rejected the notion that the debt will not affect the county's creditworthiness. He said he had not seen a breakdown of the assumptions built into the staff's cost-efficiency analysis, including whether members had accurately estimated the price of maintaining the plant. Herrity also said the county should examine the experience of Harrisburg, Pa., in owning a waste-to-energy plant.

"It affects the total debt to the county," Herrity said. "Go ask Harrisburg, because they almost went bankrupt, and those were revenue bonds."

The terms of the arrangement require the county's Board of Supervisors to make a decision by March 3, although Griffin said both sides appeared likely to extend that deadline 30 days. The board is expected to consider the matter at a public hearing Feb. 22.

Chairman Sharon Bulova (D) said she was keeping an open mind on whether buying the plant makes sense. But she also disagreed with Herrity on the question of whether purchasing the plant would affect its credit rating. "When Supervisor Herrity says that this will interfere with our ability to build schools, buy parkland and build public facilities, it's just not true," she said.

kunklef@washpost.com


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