Town Council Moves Forward With Incinerator Deal

As part of its Tuesday meeting, the Parsippany Township Council hosted a second public hearing on its contract with Synagro, a sewage sludge processing firm. If the deal agreed upon by the company and the township is approved by the state's Department of Environmental Protection and Division of Local Government Services, Synagro will take over management of Parsippany's wastewater treatment plant on Edwards Road.

The plan calls for the creation of the Parsippany-Troy Hills Bio-Energy Center, L.L.C., a Synagro company. This entity will upgrade the town's incinerator and plant to make them more energy efficient, which attorney John Wyciskala said could save the township an estimated $50,000 to $100,000 per year.

Wyciskala explained that Parsippany built two incinerators in the 1970s that served the town and other communities. By the early 2000s, he said the incinerators were inefficient and failed to meet clean air standards. Since cheaper alternatives had become available, the plant's customer base dropped off, and in 2006, the plant closed.

Since then, the township has paid other plants in Pennsylvania and Ohio to handle waste. Wyciskala said this was not the most economically wise choice.

"It leaves us at the mercy of the market," he said, adding that incineration, as opposed to dumping trash into landfills, is the way to go. "Eventually, landfills are going to run out of space."

In 2008, Parsippany commissioned a study on the best way to revive its wastewater treatment plant, according to the attorney. He said that contracting out the work was found to be cost-inefficient and that retrofitting the plant was too expensive and potentially dangerous. And the cost of building a new plant was deemed to be exorbitant.

"We generate a lot of sludge, but not enough to warrant that expense," Wyciskala said.

The town accepted proposals for the job of doing a plant upgrade and Synagro offered a plan that officials found attractive. The company's reputation earned praise as well.

"They are in 36 states and have more than 1,000 wastewater clients," Wyciskala said. "Synagro has saved money for many municipalities."
What made this company particularly appealing to town leaders was its willingnexx to take on costs.

"The project will cost $60 million, and Synagro will pay it," the lawyer said. "All of the risk and cost lies on Synagro, not on this community."
Wyciskala explained the contract between the township and the sewage treatment firm.

The deal is for 20 years with an option to extend it for an additional five years. In addition to shouldering all costs related to construction and the plant upgrade along with any fines levied and all insurance coverage, Synagro will pay Parsippany a $1 million host fee in three installments: $250,000 next year, another $250,000 in 2013 and the remaining $500,000 when the plant goes online (depending upon how quickly the work is done, that could be as early as 2014).

In addition, the company will pay to rent a portion of the plant property for $100,000 per year once the facility is online.

In return, Parsippany will pay Synagro to handle its waste at a special starting price of $79.95 per ton. Under the deal, the township must guarantee to process (or at least pay for it) a minimum of 14,000 tons. The rate remains stable for up to 16,500 tons (Par-Troy produces a yearly average  of about 15,000 tons). If the maximum is exceeded, the town must pay market rate for any sludge over 16,500 tons.

Wyciskala added that if the market rate is less than the rate specified in the contract, Parsippany will get the lower rate.

The plant will be a revenue generator for the town too. Wyciskala said the new plant will accept business from other towns and pay Parsippany $2.50 per ton processed.

All of the rates mentioned, Wyciskala noted, could vary based on the national Consumer Price Index.

"We project receiving $300,000-$400,000 per year in host fees," he said. "With increases in CPI, that could end up being about $600,000."

Wyciskala said the upgraded plant will also allow Parsippany to get into the renewable energy business. Using recaptured heat and recycling fats, oils and grease, an alternate energy source can be created.

"Synagro will profit over time," he said, "but based on the enormous risks and costs they face, we don't think their ultimate gains are unreasonable. We believe we have a good and fair deal for the township."

Information that the DEP and the federal Environmental Protection Agency are no longer awarding permits to incineration plants is untrue, said Wyciskala.

"The DEP and the EPA do award permits," he insisted. "But they're not easy to obtain. A plant must pose no threat—period."

While the deal between Parsippany and Synagro has been finalized, the contract must be approved by the DEP and the Division of Local Government Services. And residents have the right to speak out as well. Citizens interested in sharing their view on the project have until the end of day on Sept. 20 to deliver their written statements to Township Clerk Elesha Johnson.

The next step, the attorney said, will take place at the Sept. 20 council meeting, when a formal resolution on the Synagro deal will be voted upon

The first public hearing on the Synagro contract took place in June.