Montgomery, Alabama, acquires idled MRF from IREP

Montgomery, Alabama, acquires idled MRF from IREP

City will pay $625,000 to acquire plant and adjacent lot from former operator.

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The city of Montgomery, Alabama, and its Solid Waste Disposal Authority have signed an agreement to acquire the material recovery facility (MRF) and adjacent lot from its current owner and former operator, Infinitus Renewable Energy Park (IREP), for $625,000 and other considerations. The MRF, which recovered recyclables from municpal solid waste (MSW) was built for about $35 million and was ballyhooed at the time for the claim that it could recover for recycling close to 60 percent of the material delivered to its door. With the addition of waste-to-energy and composting components the MRF would see a landfill diversion rate topping 90 percent.

After opening to significant publicity in April 2014, IREP closed the facility in October 2015. At the time of the closure, Kyle Mowitz, Infinitus CEO, said, “One key element of a successful materials recycling program is the ability to sell recovered material at a price that will support the recycling process. While our customers have been satisfied with the material we have reclaimed, unfortunately the market price for these materials have dropped dramatically.”

When the MRF was built, the city’s obligation was to deliver 100,000 tons of MSW annually, paying a tipping fee for the material. Whatever material was not recovered for recycling, composting or energy recovery at IREP was to be delivered to the city’s landfill, and IREP would pay the city a tipping fee.

When first opened, Infinitus’ proposal claimed that it could achieve recycling rates in the 60 percent range, according to Chris Conway, public works director for the city of Montgomery. “With the waste-to-energy (WTE) component in the organic material, they could get into the 95 percent range.”

In announcing the plan for the city to acquire the property, Montgomery Mayor Todd Strange says, "Although it's been a long road, today marks a significant step toward bringing one of the most technologically advanced recycling facilities in the nation back online. We remain committed to our goal of protecting the environment, while providing a cost effective and efficient service to citizens. Our vision is to find a partner who can not only take over operations at the facility and succeed, but we want to find someone who will lead us into the future and set an example other cities can follow."

Under the agreement , IREP promptly will file for Chapter 11 bankruptcy and will request that the terms of the agreement be considered for approval by the Bankruptcy Court in accordance with a schedule and procedures established by the court.

The agreement also provides that the closing of the purchase will be within five business days after the Bankruptcy Court’s approval of the agreement. After the allotted time, the approved purchaser will become the owner of the facility, together with all related machinery and equipment.

Per approval and finalization of the agreements, city officials plan to find an organization capable of resuming operations at the facility. Montgomery Finance Director Barry Crabb met with more than five potential operators over the past months and will continue meeting with interested parties. Any potential operator must agree to take the facility and process recycling without any additional financial commitments on behalf of the city and Solid Waste Disposal Authority.