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MOSA: ‘Rates down, services up’

Sunday, April 3, 2011
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— Tipping fees have come down and services have been increased, but the future of the Montgomery-Otsego-Schoharie Solid Waste Management Authority still remains in doubt.

MOSA Executive Director Dennis Heaton put out a news release last week titled “MOSA rates down, services up.” The news release detailed the 35 percent reduction in MOSA tipping fees, down to about $69 per ton from a high of $106 last year. The authority has also expanded operations at its Cooperstown transfer station to allow daily residential and commercial customers.

Recycling rates among the three counties have also gone up 6 percent and an expanded number of items are eligible for recycling at the authority’s transfer stations including electronic waste, clean wood, metal and yard waste.

Heaton said he thought it was important to showcase some of the positive developments at MOSA.

“It’s not often that you can decrease costs and increase services,” he said.

The news release coincided with the release of MOSA’s annual report for 2010. The report provided details on how the authority was finally able to reduce its tipping fees. Last year MOSA’s three member counties entered into an agreement to share the future liability of maintaining the closed landfills in the three counties, most of them in Montgomery County, up to 2030. Before that, MOSA had the post-closure liability of those landfills on its books, preventing it from using its reserves to pay off its remaining bond debt.

Heaton said about $8 million of MOSA’s reserves have been put into a trust that can pay off the bonds, in a process called bond defeasance, faster than MOSA was legally able to do. The three counties also put aside $1 million of money from MOSA’s reserves to create a fund to help absorb future liability costs from the landfills. These complex maneuvers allowed MOSA to stop adding the cost of its annual debt service to the cost of hauling garbage out of the three counties, allowing the tipping fees to be cut.

The moves may have also removed some of the need for MOSA to exist at all. Currently the three counties are obligated to dispose of their garbage through MOSA, but only until 2014. MOSA doesn’t operate a landfill but coordinates waste disposal from the three counties to landfills elsewhere in the state. MOSA also handles all of the day-to-day operations of maintaining the closed landfills, including hauling away contaminated water, which is sometimes a daily chore during rainy periods. The post-closure agreement between the three counties gives them the choice of keeping MOSA as the entity that monitors and maintains the closed landfills or they could do it in some other way.

Otsego County recently petitioned the state to have it removed from the authority despite the dropping tipping fees. Alexander Shield, one of Otsego County’s representatives on the MOSA board of directors, said his county wants out of MOSA in part because the three counties are still liable to provide MOSA with a Guaranteed Annual Tonnage of garbage until 2014. Whenever the counties provide less than their GAT they are required to pay a penalty to MOSA. Shield said Otsego County has also given up hope MOSA will ever site a landfill, one of its original missions when it was formed in 1989.

“My county feels there is too much additional exposure if MOSA can’t rein in its spending,” he said.

MOSA board Chairman John Thayer, also the supervisor from Root, said there are reasons for Montgomery County to stay in MOSA, possibly even after 2014, if the other two counties continue to choose to dispose of their garbage together. He said MOSA’s new waste-hauling contract, with Syracuse-based hauler We Care Transportation, maintains a fixed rate until 2014 regardless of whether Otsego County is able to pull out of MOSA. After that, though, he thinks it would be more expensive for Montgomery County to dispose of its waste without being able to leverage the additional tons of waste from the other two counties.

“I think the jury is still out as to which way Montgomery County is going to go. There are good reasons to stay in MOSA and there are good reasons to get out,” he said. “One of the good reasons to stay is that there has been a tremendous effort to turn MOSA around over the last three years, to get it to the point where it makes sense, so it’s not charging exorbitant fees.”

Thayer said some of the progress with MOSA has included lowering the GAT penalty. It used to be the full tipping fee per ton and now it’s only about $18 per ton, which is the difference between the tipping fee and what We Care Transportation charges MOSA. He said MOSA will also continue to exist whether or not the counties participate in it, unless the state Legislature dissolves the authority.

One thing MOSA won’t likely be doing is creating a landfill. Heaton said the three counties together only dispose of about 100,000 tons of garbage per year, which he doesn’t believe is enough to pay for the expense of building a landfill.

 
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