Agreement between the Village of Owego and Inflection Energy

Agenda Topics What is Proposed Project definitions, who is involved, what has been done, why this is being proposed, contract details What this means to the whole Village Taxpayer benefits, infrastructure benefits, Revenue, Future EPA mandates, Details Other agencies roles, permits, Additional thoughts and next steps Concerns and timing

What is Proposed Project definitions, who is involved, what has been done, why this is being proposed, contract details

Inflection Energy wishes to purchase 200,000 gallons of effluent daily from the Villages wastewater treatment plant. Inflection Energy has agreed to pay the Village 5 cents per gallon of effluent. The sale of effluent would generate up to 3.65 million dollars of revenue per year. The contract would be for a period of 10 years with the possible extension of the contract on a yearly basis at the end of the contract period.

Effluent is the treated wastewater that would be discharged into the Susquehanna River.

The quality of the effluent from the treatment plant is greater than that of the river itself. The effluent is less turbid than the river and has been treated to remove biological waste. Location of the Treatment Plant in relation to their leases. Easy access to a major highway interchange. They are interested in being good corporate neighbors.

The contract addresses the amount of effluent to be sold and the amount to be charged per gallon. The amount is 200,000 gals./day up to 6,000,000 gals/month at $0.05 per gal. Since the Village currently does not disinfect prior to discharge an Ultra-violet disinfection (UV) unit would have to be installed. Inflection Energy will provide the funding for the design and construction of the UV unit. The estimated costs for the UV unit is $400, and the village would repay Inflection through a reduced sale price of the effluent. The reduced charge would be $0.025 per gallon with an estimated repayment of 80 days.

Contract negotiations with Inflection Energy Several conversations with NY DEC on the permit modification and what would be required. NY DEC has included a set of special conditions that would be added to our permit. The largest and most direct condition was the disinfection of the effluent. On October 20 th a meeting was held in Albany with NY DEC, NY DOH, Inflection Energy and Village of Owego representatives to discuss what needed to be done to move this project forward.

Taxpayer benefits, infrastructure benefits, Revenue, Future EPA mandates,

The sale of the effluent would provide a large revenue source that could be used for many large and costly projects. There is already talk from US EPA on requiring all treatment plants to disinfect. This project will install a disinfection unit at the treatment plant.

First and foremost there would be a reduction in the sewer rates. These were driven by the Chesapeake Bay program and with the additional revenue we would be able to reduce the sewer rates to the 2005 levels and remove the $7.50 per quarter Capital Improvement charge. The revenue would allow the village to make any improvement required to meet the Chesapeake Bay standard without a long term bond if bonding were even necessary. A reserve fund for the replacement of equipment at the treatment plant would be properly funded to insure that any future needs could be met without the need to bond for them. The separation of the collection system. This would involve the installation of a new sanitary sewer system. The funding would provide for new mains, connections from the street to the foundation of the homes, new sidewalks, curbs and streets. The entire village infrastructure would be replaced without having to increase taxes.

This contract has the potential to provide the village with 3.65 million dollars for 10 or more years. Thats a total of not less than 36.5 million dollars. We are selling water that has been treated and would normally just be released to the river for no further use. These revenues will allow the village to reduce sewer rates, improve the entire infrastructure of the village and vastly improve the quality of life within the village without raising taxes.

It would be business as usual in the village. The Chesapeake Bay requirements will continue to increase operating costs at the treatment plant and will ultimately require increases in the rates. The village streets and infrastructure will continue to deteriorate and the need to address these issues will require property taxes to be increased. Another opportunity for the Village Board of Trustees to improve their residents lives without increasing their costs will have been lost.

Other agencies roles, permits,

A letter to be sent to NY DEC requesting a modification to the Villages SPDES permit. (Done 10/22/10) Disinfection of the effluent to be sold to Inflection. The village does not have to disinfect any portion of its effluent that is not sold. Disinfection would be 24/7 year round and no sale would be permitted if the UV unit is out of service for any reason. Effluent that is sold is tracked. Time of pick up, Company name, destination, truck number, time of delivery. Inflection to require this information as its part of the drivers manifest. This information is to be made available to NY DEC at any time. A short form type 2 SEQR review be done with the Village as Lead Agency and NY DEC and NY DOH as involved agencies. (Undertaken with expectation of it being completed by the end of December)

SRBC would have to approve the consumption of the water as this is a permit by rule for the SRBC. This would be done after all the contractual and regulatory issues have been completed. NY DEC will notify SRBC on the permit modification and Inflection will notify for the diversion of our flow.

The Village would have to seek a modification to its SPDES permit. The current permit allows the effluent to be discharged only to the river. The effluent would have to be disinfected. Currently there is no requirement for disinfection. The effluent that is sold would have to be pumped to the Southside of Rt. 17. Inflection Energy to pay for and maintain the delivery system.

Village Board needs to ratify this contract with Inflection Energy. Completion of the SEQR review and submit to NY DEC. Design and construction of the UV unit and delivery systems. Approval for the mayor to sign water withdrawal point agreement when completed by the Village attorney. The withdrawal point is located behind the treatment plant. SRBC approval.

Leases held by Inflection Energy are located on the Southside of Owego and in Broome County. Truck traffic would be on state, county and town roads. Inflections business model calls for the use of trucks for the first two years while a pipeline is being installed to convey water to central pick-up points using existing rights of way. NO VILLAGE FUNDS WOULD BE USED FOR ANY PORTION OF THIS PROJECT.