1. MRC Annual Meeting December 12, 2012 Welcome MRC BOD election results Preliminary FY2013 budget PERC facility performance PERC partnership outlook MRC financial results Key MRC issues for 2013 and post-2018 planning Greg Brown, MRC Vice President Greg Lounder, MRC Executive Director Sophie Wilson, MRC Treasurer Peter Prata, PERC Plant Manager Kevin Nordby, PERC Holdings, Inc. George Aronson, CRMC Greg Lounder, MRC Executive Director

2. Ensure affordable, long-term, and environmentally sound disposal of municipal solid waste 2 THE MRC MISSION: MRC Annual Meeting, December 12, 2012

3. 3 Represent Charter Municipalities in their roles as MSW providers to and public partners in the PERC facility Contract compliance (Waste Disposal Agreements) Facility technical and environmental performance; operating and major maintenance/capital costs (Oversight Committee) Regional solid waste markets Legislative and regulatory activities Manage Charter Municipality assets, including: Limited partnership shares in PERC Performance Credits and cash distributions from PERC Tip Fee and Operating Budget Stabilization Funds Prepare for MSW management after 2018 MRC Ongoing Activities

4. MRC Operating Budget, Calendar Year 2013, proposed MRC Annual Meeting, December 12, 2012 4 MRC PROPOSED OPERATING BUDGET for calendar year 2013 FY 2012 FY 2012 Year-End FY 2013 Budget Estimate Budget REVENUES Member dues $1.25/ton, 181,500t in 2012, 181,000t in 2013 $ 229,375 $ 229,115 $ 226,250 Post-2018 planning (budget amendment (per 9-28-12 vote) $ 90,000$ 18,000 Undesignated Fund Balance Transfer $ 64,845$ 64,630$ 5,100 BHE Parity Deal Monitoring Agreement $ 53,600 $ 55,843 $ 55,800 Budget Stabilization Fund Transfer $ 70,000 $ 175,000 PERC Oversight Committee Reimbursement $ 9,700 $ 9,850 Legislative Advocacy/Communications Reimbursement $ 45,000 $ 22,500 TOTAL REVENUES $ 562,520 $ 469,938 $ 472,000 EXPENSES Legislative Advocacy/Communications (Preti, Eaton Peabody) $ 90,000 $ 61,000 $ 66,000 Administrative Services (Ex Dir, outside services) $ 135,000. $ 141,000 $ 145,000. Technical Consultant (CommonWealth) $ 115,520 $ 114,000 $ 119,000 Legal Services (Eaton Peabody-General) $ 15,000 Legal Services (Eaton Peabody-Specialized) $ 45,000 $ 54,335 $ 45,000 Audits (Loiselle, Goodwin & Hinds) $ 10,500 $ 11,000 Insurance (General liability, D&O) $ 6,000 $ 5,313 $ 5,500 Secretary of State & Misc. $ 500 $ 790 $ 500 Post-2018 Planning Contingency $ 45,000 $ 50,000$ 55,000 Contingency Fund $ 10,000 Post-2018 planning (per 9-28-12 vote) $ 90,000$ 18,000 TOTAL EXPENSES $ 562,520 $ 469,938 $ 472,000 Audited Undesignated Fund Balance, December 31, 2011 $115,459 Estimated Undesignated Fund Balance, December 31, 2012 $ 50,829 Projected Undesignated Fund Balance, December 31, 2013 $ 46,229 Note: $16,000 legislative advocacy expense approved for Nov. and Dec. 2012 Note: Post- 2018 planning contingency for 2012 includes $25,000 for CommonWealth, $15,000 legal, $10,000 other

5. PERC Facility operating performance MRC Annual Meeting, December 12, 2012 5 PERC 2013 Operating Budget: revenues 2013 Budget2012 BudgetVariance MSW deliveries (tons) Charter Muni 182,000 0 Other muni 11,965 10,950 1,015 Commercial 90,098 86,768 3,330 In-state other 3,755 3,249 506 Out-of-state 16,919 17,133 (214) Total received 304,737 300,100 4,637 Total tip fee revenues $ 17,832,131 $17,182,545 $649,586 Weighted average tip fee $58.52/ton $57.26/ton $1.26/ton Power Plant Production Capacity factor86.18%85.90%0.87% Full load hours75677226341 One boiler hours 7131522 (809) Black plant hours48036444 Total generation (MWh) 159,747 159,668 78,377 Total electricity revenues $24,249,762 $23,291,106 $958,656 Weighted average $/MWh $151.80/MWh $145.87/MWh $5.93/MWh

6. PERC Facility operating performance MRC Annual Meeting, December 12, 2012 6 PERC 2013 Operating Budget: performance assumptions 2013 Budget 2012 BudgetVariance RDF Heat Input%94.1%92.7%1.5% #2 oil heat input%1.5% 0.0% Wood chip heat input%4.4%4.9%-9.1% RDF processing yield%79.3% 0.0% RDF consumedTons 241,563 237,973 3,591 Ferrous processing yield%3.0% 0.0% Ferrous productionTons 9,142 9,003 39 Glass and grit yield%17.2% 0.0% Glass and grit producedTons 52,508 51,624 884 Non-processable yield%0.5% 0.0% Non-processablesTons 1,524 1,501 23 Non-processables grindingTons 13,713 13,505 218 Ash yield%23.0%23.1%0.1% Ash producedTons 56,662 55,948 714 Wood chip cost$/ton 7.14 17 Wood chips requirementTons 13,793 15,170 (1,377) Wood chip expense$ 98,519 272,886 (174,366) Fuel oil cost$/gallon $ 3.75 $ 3.50 $ 0.25- Fuel oil requirementTons 308,083 307,932 151 Fuel expense$ 1,155,311 1,077,761 77,550 Lime useTons 4,596 4,557 39 Lime cost$/ton $ 204.09 $ 196.24 $ 7.85 Lime expense$ 938,030 894,173 43,857

7. PERC Facility CMRA projects MRC Annual Meeting, December 12, 2012 7 PERC 2013 Operating Budget: CMRA projects Capital Projects 2013-01Install fire exhaust fans in four mills 50,000 Major Maintenance Projects 2013-20Plant paving and concrete 75,000 2013-21Plant painting 75,000 2013-22Building and roof repairs 125,000 2013-30"A" Boiler Inconel repairs 550,000 2013-31"A" Boiler baghouse tube sheet 375,000 2013-32"A" Boiler air heater sleeve 255,000 2013-33"A" Boiler superheater pendant loop 212,500 2013-40"B" Boiler Inconel repairs 550,000 2023-43 “B” Boiler superheater pendant loop 212,500 Major Maintenance Projects (continued ) 2013-50T/G major overhaul and inspection 983,000 2013-51NERC compliance 75,000 2013-60"A" disc screen rebuild 95,000 2013-61"A" trommel repair and grinding 96,000 2013-62"A" trommel side wall repair 125,000 2013-63"A" Prentiss overhaul 78,000 2013-70"B" disc screen rebuild 94,000 2013-71"B" trommel repair and grinding 92,000 2013-72"B" trommel side wall repair 65,000 2013-73"B" Prentiss overhaul 80,000 2013-80A-20 conveyor overhaul 300,000 2013-81A-21 conveyor overhaul 100,000 4,665,000

8. Charter Municipality Assets Managed by the MRC 8 MRC Annual Meeting, December 12, 2012

9. Charter Municipality Joint Venture Assets Managed by the MRC all values in thousands of dollars as of October 1, 2012 ASSETSLIABILITIES AND GENERAL FUND BALANCES Custody Account (Bangor Savings) [see note] 1,396 Cash distributions payable 1,212 Tip Fee Stabilization Fund 20,718 Net Assets - Designated for Tip Fee Stabilization 20,718 MRC Operating Budget Stabilization Fund 2,624 Net Assets - Designated for MRC Budget Stabilization 2,624 Investment in PERC (valued by the equity method) 10,286 Other Net Assets 10,470 TOTAL ASSETS 35,024 TOTAL LIABILITIES AND NET ASSETS 35,024 9 Actual Financial Results for 2012 MRC Annual Meeting, December 12, 2012

10. 10

11. Sources and Uses of Funds, 2012 Sources of Funds, 2012 ($000) Performance Credits $ 3,028 Net Cash Flow from PERC 855 Earnings on funds 344 Total sources $ 4,228 Uses of Funds, 2012 ($000) Cash distributions $ 4,698 Changes in fund balances $ 470 Total uses $ 4,228 11 Actual Financial Results for 2012 MRC Annual Meeting, December 12, 2012

12. Actual Financial Results for 2012 MRC Annual Meeting, December 13, 2012 Joint Venture Financial Highlights in 2012 (Actual through December 1, 2012; projected through December 31, 2012)  Cash distributions ($4.698 M) exceeded cash received from Performance Credits, distributions from PERC and earnings ($4.228 M)  Raised target value on July 1, 2012, to prepare for 2018  Maintained Tip Fee Stabilization Fund at $21 million  Used reserve funds from PERC re-financing to increase Operating Budget Stabilization Fund to $2.624 million  Distributed $48.2M to Charter Municipalities since 1998 12

13. Forecasted Financial Results for 2012 MRC Annual Meeting, December 13, 2012 13

14. Projected Sources and Uses of Funds, 2013 14 Forecasted Financial Results for 2013 MRC Annual Meeting, December 13, 2012 Sources of Funds, 2013 ($000) Performance Credits $ 2,705 Net Cash Flow from PERC 766 Earnings on funds 346 Subtotal $ 3,817 Net fund withdrawals 910 Total sources $ 4,727 Uses of Funds, 2013 ($000) Cash distributions $ 4,727

15. Target Value Increase Plan Approved by the MRC Board on 27 October 2010 First increase went into effect on 1 July 2011 MRC Annual Meeting, December 13, 2011 YearAdd Target value as of 7/1 2010$45 2011$1$46 2012$2$48 2013$3$51 2014$4$55 2015$4$59 2016$4$63 2017$4$67 15

16. MRC Annual Meeting, December 13, 2012 16 Actual Projected

17. MRC Annual Meeting, December 13, 2012 17

18. Challenges for 2012 and beyond MRC Annual Meeting, December 13, 2012 18 Deliveries continued to decline in 2012

19. Post-2018 activities in 2012  MRC actions Surveyed membership on MSW management Worked with members to direct MSW to PERC Evaluating single-sort recycling and organics processing Monitoring emerging conversion technologies (liquid fuels?)  PERC private partners negotiated to bring MSW from MERC to PERC; working on GAT issues  Maine state legislature actions Rejected PERC proposal on renewable energy credits Allowed new expansions of commercial landfills Post-2018 planning MRC Annual Meeting, December 13, 2012 19

20. Post-2018 activities in 2012: findings  The PERC partnership: still the preferred disposal option for 2018 and beyond  MSW management: less MSW is better all-around, but PERC needs a steady MSW supply  Economics: the affordability of PERC tip fees after 2018 is a key concern  Options: the MRC is investigating contingency plans in the event PERC might not be affordable Post-2018 planning MRC Annual Meeting, December 13, 2012 20

21. Post-2018 activities in 2013  PERC will get more Maine MSW after MERC closes  MRC will intervene in the DEP review of the permit application to allow MSW into Juniper Ridge LF  MRC is monitoring closely: Charter Muni post-2018 disposal needs after enhanced MSW reduction, recycling and composting Cost for MSW collection, transfer and transportation  MRC is formulating contingency plans to advance the MRC mission beyond 2018 Post-2018 planning MRC Annual Meeting, December 13, 2012 21