Cost Claims Add To SMRC’s Woes
THE Southern Metropolitan Regional Council (SMRC) maintains its controversial Canning Vale waste processing plant is still costneutral, despite existing debts and the threat of another council ceasing to use the facility.
SMRC spokesman Chuck Ellis defended figures in the council’s 2010 annual report indicating the Regional Resource Recovery Centre (RRRC) lost $3.8 million last year, attributing it to a depreciation in gate fees.
He said the council’s reference to the facility being cost-neutral referred to its annual budget.
“(Last year’s) figure appears as a loss because in our business model we do not incorporate the cost of depreciation in our gate fees,” Mr Ellis said.
“This is one of the ways we keep costs down compared to a similar service if it were run by the private sector seeking to make a profit.”
Mr Ellis also defended $53m in loan repayments owed to the State Treasury for building the RRRC. He said a repayment schedule was a part of the facility’s business plan agreed to by project participants – the SMRC member councils of Cockburn, Fremantle, East Fremantle and Melville – which also transport waste to the facility.
“By June 30, we are forecasting the loans will have been reduced to $49.7 million due to our planned repayments in the 2010-11 (financial year),” he said.
Mr Ellis said the debt should be paid off by 2023.
The council has also been questioned over the feasibility of rebuilding its Materials Recovery Facility (MRF) at the site, which burnt down in 2009, in light of the City of Canning’s decision in 2009 to sever ties with the SMRC and stop sending waste to it on June 30 this year.
The City of Melville may also follow suit after announcing last month it would hold a review into its waste disposal options.
“The increasing cost of disposal is the primary concern addressed by the review,” Melville’s acting chief executive John Christie said.
The City of Rockingham last month withdrew its membership from the SMRC, citing the adoption of its new waste strategy.
Mr Ellis said member councils had “always known” that moving away from landfill for waste disposal would involve increased costs.
“Consultation with the community has shown a willingness to pay an increased cost for environmental benefits the RRRC brings,” he said.
The controversial Regional Resource Recovery Centre at Canning Vale.
