Trash To Energy Plant

[RecycleMichael]

The city agreed contractually to build it in 1984 during Inhofe. That is when the decision to have Ogden Martin be the sole owner was made. It took two years to build.

During the 1984 election season, Terry Young opposed the plant and instead proposed a large recycling facility.

Ogden sold it to CIT the month before it opened. The day it opened, then Mayor Terry Young and the city commission (operating as the Tulsa trash authority) decided to expand the plant from two burners to three.

That was a stupid decision that also caused our public debt to go up.

[Conan71]

I don't remember a whole lot about the genesis of the plant since it's been some time back and I was more concerned about college than what was happening in city politics back then.

Makes you wonder why we kept promoting Inhofe to more powerful political positions.  

I'm trying to recall now, what were the issues that helped Young lose the primary?

[Wrinkle]

There's also another $150-$180 Million in energy which we seem to haven never benefited.

Just what was it the City received in exchange for its' ownership position?

[Wrinkle]

Here's some more history, which is quite revealing:

===========

COVANTA ENERGY: CIT Group Holds $65,389,296 Allowed Claim
---------------------------------------------------------
Before the April 1, 2002 Petition Date, Covanta Tulsa, Inc., and
Bank of Oklahoma, National Association, formerly known as Bank of
Oklahoma, Tulsa, N.A., as Owner and Trustee for the benefit of
CIT Group/Equipment Financing, Inc., entered into a transaction
under which Covanta Tulsa sold to Bank of Oklahoma, and the Bank
leased back to Covanta Tulsa:

   * a waste-to-energy facility operated by Covanta Tulsa; and

   * certain equipment and other property associated with
     operation of the Facility.

In connection with the Sale Leaseback Transaction, Covanta Tulsa
and Covanta Energy Corporation entered into several lease
agreements, contracts, and guarantees with Bank of Oklahoma,
including:

   (a) a Site Sublease Agreement, originally dated December 1,
       1986;

   (b) a Third Unit Lease Agreement, originally dated July 21,
       1986;

   (c) a Lease Agreement, originally dated July 21, 1986;

   (d) a Participation Agreement dated July 21, 1986;

   (e) a Facility Support Agreement dated July 21, 1986;

   (f) a Guaranty, Pledge and Security Agreement, originally
       dated July 21, 1996;

   (g) a Tax Indemnity Agreement dated July 21, 1986;

   (h) a Supplemental Tax Indemnity Agreement dated September 16,
       1987; and

   (i) an Agreement of Purchase and Assumption dated July 21,
       1986.

Covanta guaranteed certain of Covanta Tulsa's obligations under
the Agreements pursuant to written guarantees.

Vincent E. Lazar, Esq., at Jenner & Block, LLP, in Chicago,
Illinois, relates that after the Petition Date, Covanta Tulsa and
Bank of Oklahoma entered into negotiations to restructure the
terms of the Sale Leaseback Transaction, which had become
undesirable for Covanta Tulsa and would have caused Covanta Tulsa
to operate at a material loss in the future.  Those negotiations,
however, were not successful.

As a result, by a request dated September 29, 2003, Covanta Tulsa
sought and obtained permission to reject the Agreements with Bank
of Oklahoma effective October 15, 2003.

Pursuant to the confirmed Second Amended Joint Plan of
Reorganization, Mr. Lazar explains that creditors like CIT fall
under "Class 6 - Allowed Parent and Holding Company Unsecured
Claims" and entitled to receive distributions on account of their
claims.  Creditors holding unsecured claims against a Debtor that
is the subject of the confirmed Second Amended Joint Plan of
Liquidation, on the other hand -- including CIT's claims against
Covanta Tulsa -- are not receiving any distributions on account of
their claims.

CIT filed Claim No. 4581 against Covanta for $128,408,156 plus
other unliquidated amounts for the damages it suffered as a result
of Covanta Tulsa's rejection of the Agreements that Covanta
guaranteed.  In addition, Bank of Oklahoma, in its capacity as
Owner and Trustee for the benefit of CIT, filed Claim No. 4575,
which is duplicative of Claim No. 4581.

CIT asserted a claim exceeding $100 million on the basis of the
Participation Agreement rejected by Covanta Tulsa and guaranteed
by Covanta.  The claim provided for liquidated damages in the
event of a breach in an amount including:

   -- the outstanding amount of the public bonds issued to
      finance the construction and start-up of the Tulsa WTE
      Facility;

   -- the "Stipulated Loss Value" as defined in the Agreement;
      and

   -- unpaid rent, less the fair market sale value of the Tulsa
      WTE Facility.

Covanta objected to Claim Nos. 4575 and 4581 and sought to have
those claims liquidated.

To avoid further litigation, Covanta, CIT and Bank of Oklahoma
entered into a settlement wherein the parties agreed to a
compromise of CIT's disputed claims.

The Settlement provides that:

   (1) Claim No. 4581 will be allowed and fixed as a Class 6 -
       Allowed Parent and Holding Company Unsecured Claim for
       $65,389,296, without offset, defense, or counterclaim;

   (2) Claim No. 4575 will be disallowed as a duplicate of Claim
       No. 4581; and

   (3) Nothing will constitute or be deemed to constitute a
       waiver of any rights any parties-in-interest may have with
       respect to the $65,389,296 Allowed Claim.

Although under the Reorganization Plan, the Reorganized Debtors
have the exclusive right to file and prosecute claims objections
and are free to operate their business --- including entering into
settlements without seeking court approval -- the Reorganized
Debtors sought Court approval of the Settlement in light of the
magnitude of CIT's claim and its potential impact on the
distributions that will be made to other Class 6 creditors.

At the Reorganized Debtors' request, Judge Blackshear approves the
Settlement in its entirety and authorizes the Reorganized Debtors
to consummate the transactions contemplated.

Headquartered in Fairfield, New Jersey, Covanta Energy Corporation
-- http://www.covantaenergy.com/-- is a publicly traded holding  
company whose subsidiaries develop, own or operate power
generation facilities and water and wastewater facilities in the
United States and abroad.  The Company filed for Chapter 11
protection on April 1, 2002 (Bankr. S.D.N.Y. Case No. 02-40826).
Deborah M. Buell, Esq., and James L. Bromley, Esq., at Cleary,
Gottlieb, Steen & Hamilton, represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they listed $3,280,378,000 in assets and
$3,031,462,000 in liabilities.  On March 10, 2004, Covanta Energy
Corporation and its core subsidiaries emerged from chapter 11 as a
wholly owned subsidiary of Danielson Holding Corporation.  Some of
Covanta's non-core subsidiaries have liquidated under separate
chapter 11 plans. (Covanta Bankruptcy News, Issue No. 75;
Bankruptcy Creditors' Service, Inc., 215/945-7000)

[RecycleMichael]

Thanks wrinkle...I had not seen those documents.

The bankruptcy of Covanta was certainly weird. The trash plant was only one of their business interests and it had a stable income source.

I heard they also were in the casino business in some other country.

[RecycleMichael]

quote:Originally posted by Conan71


I'm trying to recall now, what were the issues that helped Young lose the primary?

I remember that Terry Young beat James Inhofe after Jim made some negative comments about north Tulsa and they came out strong during the election.

I remember an incident related to a forged letter that was traced back to a typewriter found on the 11th floor. It caused suspicion and Terry lost to sign guy Tom Quinn.  

I also think that Terry lost because he never stopped talking to the press. If the cameras were rolling, he was trying to explain himself. At the same time, President Ronald Reagan was acting like he couldn't hear the reporter's questions because of other noise like a helicopter.

[Wrinkle]

Here's some more:

=================

COVANTA ENERGY: Court Allows CIT & WBH Admin. Claim for $808,873
----------------------------------------------------------------
The CIT Group/Equipment Financing, Inc., directly through its
ownership of its subsidiary WBH Generating Company, LLC, is the
sole beneficiary of a trust administered by The Bank of Oklahoma,
Tulsa, N.A., as owner trustee to Meridian Trust Company, pursuant
to a Trust Agreement dated July 21, 1986.

Pursuant to certain agreements, Covanta Tulsa, Inc., sold to the
Owner Trustee, and the Owner Trustee leased back to Covanta
Tulsa, the Walter B. Hall Resource Recover Facility and certain
equipment and other associated property located in Tulsa,
Oklahoma.  Covanta Energy Corporation guaranteed Covanta Tulsa's
obligations to the Owner Trustee and CIT.

Covanta Tulsa sought and obtained the Court's permission to reject
the Facility Lease effective as of October 15, 2003.

On April 8, 2004, CIT and WBH sought payment of their
administrative claim aggregating $1,652,711, which is comprised
of:

    * unpaid rent owed under the lease, taxes paid by CIT and WBH
      that were owed by Covanta, and costs incurred by CIT and WBH
      in connection with the repair of the Facility; and less

    * certain amounts that CIT and WBH agreed to pay to Covanta in
      consideration for Covanta agreeing to assume and assign to
      WBH a certain contract relating to the Facility.

Ogden Liquidating Trustee James N. Lawlor objected to the
allowance of the Administrative Claim.

To resolve their dispute, Mr. Lawlor, CIT and WBH stipulate and
agree that the Administrative Claim will be allowed for $808,873.
The Liquidating Trustee will immediately pay CIT and WBH the claim
amount.

                          *     *     *

Judge Blackshear promptly approves the Stipulation.

Headquartered in Fairfield, New Jersey, Covanta Energy Corporation
-- http://www.covantaenergy.com/-- is a publicly traded holding  
company whose subsidiaries develop, own or operate power
generation facilities and water and wastewater facilities in the
United States and abroad.  The Company filed for Chapter 11
protection on April 1, 2002 (Bankr. S.D.N.Y. Case No. 02-40826).  
Deborah M. Buell, Esq., and James L. Bromley, Esq., at Cleary,
Gottlieb, Steen & Hamilton, represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
its creditors, they listed $3,280,378,000 in assets and
$3,031,462,000 in liabilities.  On March 10, 2004, Covanta Energy
Corporation and its core subsidiaries emerged from chapter 11 as a
wholly owned subsidiary of Danielson Holding Corporation.  Some of
Covanta's non-core subsidiaries have liquidated under separate
chapter 11 plans.  (Covanta Bankruptcy News, Issue No. 66;
Bankruptcy Creditors' Service, Inc., 215/945-7000)

[shadows]

Wrinkle:  do you have a figure on the total cost of the building and operations of the plant, paid by the citizens of Tulsa, including the picking up of the tab's for parties given by the operators ?

[Wrinkle]

quote:Originally posted by shadows

Wrinkle:  do you have a figure on the total cost of the building and operations of the plant, paid by the citizens of Tulsa, including the picking up of the tab's for parties given by the operators ?

I have most my old trash bills from the City, half of which went to the incinerator, in dollars, not in trash.

[Conan71]

quote:Originally posted by recyclemichael

quote:Originally posted by Conan71


I'm trying to recall now, what were the issues that helped Young lose the primary?

I remember that Terry Young beat James Inhofe after Jim made some negative comments about north Tulsa and they came out strong during the election.

I remember an incident related to a forged letter that was traced back to a typewriter found on the 11th floor. It caused suspicion and Terry lost to sign guy Tom Quinn.  

I also think that Terry lost because he never stopped talking to the press. If the cameras were rolling, he was trying to explain himself. At the same time, President Ronald Reagan was acting like he couldn't hear the reporter's questions because of other noise like a helicopter.

Oh yes, "lettergate".  I couldn't remember if Inhofe was beaten as an incumbent mayor or if he chose to run for Dist. 2 and did not seek re-election as mayor.

[Wrinkle]

FWIW, WBH Generating, LLC was not formed until 2003 by CIT.

[shadows]

The city commission voted to issue the revenue bonds that has only been paid off recently.   The ownership of the plant was never in the hands of the city.  The supposed lease back was a paper job of which the city agreed to pick up all the  expenses and perks.   A very, very short time later it was announced that the rock quarry had been approved as a land fill.   One of the city commissioners was a major stock owner in the quarry.  

There is a typical Tulsa story on the company owning the quarry and the Oklahoma road inspection teem.    

[Wrinkle]

Wanted to ask again, just what did the City of Tulsa receive in exchange for their ownership position?

We passed a bond issue on this under the premise of ownership. It's not simply up to some politician to give it away, and continue to use our money to pay the debt.

In my book, that's criminal.

[shadows]

I believe the burner was a traditional enterprise where the Tulsa taxpayers paid some 180M total cost with a "here it is deal" with the city paying all expenses to maintain it along with picking up  the tab for thousands of dollars of parties for the employees.  The ownership has always been a hidden question other than the city pays,   15% of the trash cannot be burned and must be taken to a landfill.  This part of the ashes contain the elements that contaminate the ground waters.

It all resorts to its not a government of the people but obligor of the people government.   The peoples rights are circumvented by using Authorities that are not responsible for their acts.      

[Wrinkle]

Problem partially solved, from KOTV:

Trash Plant to Shut Down Monday

Now, let's bronze it and give it to the Metro Chamber to sponser tours of Tulsa's biggest boondogle (though, the new City Hall may be competing for this soon).

Let's get to work on eliminating TARE, too.