A report which went before the council yesterday, 18 October, recommended the council approve plans to loan Tom White Waste money to redevelop the site in Longford.
The council said it is looking to agree a loan to Tom White Waste to redevelop a recycling facility in Longford. The facility is set to treat industrial and commercial waste.
The waste management company has been fully owned by the council since March 2021 (see letsrecycle.com story).
Reasons
The document explained that the business plan for Tom White Waste was approved in March subject to funding, with a commercial loan as the preferred option. However, it noted that the costs have increased since then “to take into account global movements in construction costs and changes in the recycling market”.
The document summarised the main points supporting the business case for the MRF, including an improved environmental performance. It said that the redevelopment would help support a “significant enhancement” of the recycling performance, from approximately 7% to 70%. Consequently, this is said to result in reduction in waste disposal costs. The report also mentioned positive financial return to Tom White Waste and therefore the council.
Additionally, the council’s cost of borrowing is lower than the rate of interest that will be charged to Tom White Waste, meaning the council will generate a financial benefit from the loan.
Current plant
The council outlined that Tom White Waste’s current recycling plant and equipment has “historically suffered with little planned maintenance under previous ownership”. It added that it is now experiencing “significant breakdowns, with plant availability reducing considerably”.
Due to this, the council continued, the facility experienced 72 days of plant downtime from April to December 2021, increasing cost of maintenance as well as plant hire for the previous financial year. Moreover, cost of disposal increased as well, the reason being more material going to landfill due to the plant not being available for sorting.
Councillor Richard Brown, cabinet member for finance at the council, said: “The reason for the loan is to deliver much enhanced environmental performance while also achieving greater business resilience for Tom White.
“It provides greater market surety and more cost-effective disposal routes that should completely avoid the use of landfill or the export of material from the UK.
“It will also mean the Council will directly benefit by the repayments on the loan in addition to the core environmental benefits afforded by the scheme. This is about using council funds to make investments that support the mitigation of climate change in line with Council policies and help its budget and ultimately help to then fund front line services in Coventry.
The council said that if backed, “the new facility will be operational from autumn 2023”.
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